Restructuring the Baltic Economies: Disengaging Fifty Years of Integration with the USSR

Restructuring the Baltic Economies: Disengaging Fifty Years of Integration with the USSR

Restructuring the Baltic Economies: Disengaging Fifty Years of Integration with the USSR

Restructuring the Baltic Economies: Disengaging Fifty Years of Integration with the USSR

Synopsis

The promise of a smooth systemic transformation in the Baltic states has been overshadowed by unforeseen obstacles. Speedy disengagement from the past, particularly from long established practices and inherited economic relationships, has proven more trying than originally anticipated. Compelling interview materials from the region's 115 leading government officials, including prime ministers, and academicians, highlight the major points of the text. Scholars in the United States and Europe, government officials, research and business institutes, and business trade associations will find this a thought provoking analysis of the progress and prospects of former Soviet republics and the lessons this provides for other republics of the former USSR.

Excerpt

Lithuania, Latvia, and Estonia, collectively known as the Baltic states, were independent sovereign nations after World War I. Situated at the center of Europe, for centuries they served as trading posts for East-West and North- South commerce. Immediately before World War II, the level of their economic development paralleled that of their Scandinavian neighbors. They could have become three of the most developed nations in Europe.

Following the German-Soviet agreement of 1939, Stalin annexed the Baltic states, abruptly halting their independent development paths. the Soviets incorporated the three economies into their own centralized system, reducing the prosperous Baltics to integrated status, dependent on other republics of the former Soviet Union (FSU) for factor supplies and product markets. Furthermore, their pre-annexation ethnic compositions were radically altered, with ethnic Russians constituting the majority of non-natives in the region.

During the 1980s, the decade prior to independence from the Soviet Union, the Baltic states' structural system strongly resembled that of the Soviet Union. Each state defined its structure, economy, and livelihood according to the Soviet interests in its region. Therefore, like the Soviet Union, the Baltic states were plagued with inefficiency and suffered from economic stagnation. These economic conditions intensified nationalism within the Baltic states. State and local governments began to differentiate their economies from the Soviet Union and concentrate on local interest and rational economic policy.

These conditions led Lithuania, Latvia, and Estonia to political and economic transformation. However, the transformation has been difficult. Many of the reforms have been rushed, inadequate, and more damaging than the Soviet inefficiency. Following independence in 1990, the states' primary economic objectives were to transform the remnants of the Soviet command system into a system which would utilize market coordination for economic activities.

Imperative to the success of economic transformation was currency reform. the rejection of the Soviet ruble and the creation of their own domestic . . .

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.