Ronald H. Linden

In the aftermath of the extraordinary developments of 1989, the new
governments in Eastern Europe moved to rejoin the world economy and
participate as fully as possible in global political and economic dynam-
ics, something they were enjoined from doing before. In pursuing this
goal, the states of Eastern Europe have paid a considerable price in
many forms. Five years after those momentous changes it is appropriate
to assess the costs of Eastern Europe's renewed involvement with the
rest of the world, evaluate the benefits they have derived from this asso-
ciation, and consider what the implications of these costs and benefits
are for their current situation.

A complete review of the immediate history of this region ¹ is neither
necessary nor the aim of this chapter. ² But several key points need to be
stipulated to establish the background for the current situation. First, for
the states of Eastern Europe as well as the USSR, the plunge into the
rough and tumble of the world economy has been dramatic and sudden.
Prior to the changes of 1989 (and 1991 in the USSR) these countries were
marginal players in the global economy. In 1988, for example, all Soviet,
East European and Yugoslav exports accounted for just over 8.5 percent
of world exports; Eastern Europe alone, for just over 4 percent. Nor did
trade with the global market play an important part in their economies.
For all of Eastern Europe (except East Germany), the USSR and Yugo-
slavia, the average ratio of all exports to GNP was 15 percent, compared,

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