Soviet Influence in Latin America: The Role of Economic Relations

Soviet Influence in Latin America: The Role of Economic Relations

Soviet Influence in Latin America: The Role of Economic Relations

Soviet Influence in Latin America: The Role of Economic Relations

Excerpt

Latin America and the Soviet Union and Eastern Europe are both huge continental land areas whose combined foreign trade constitutes more than 15% of total world trade. Both of the areas are rich in manpower and natural resources and both are still in the throes of economic development. Latin America, however, remains primarily dependent upon agricultural and mineral products. Both regions are growing rapidly economically, with Latin America lagging slightly and displaying somewhat more erratic progress, partly because of its more rapid rate of population growth, partly because its democratic states cannot and do not wish to take the stern measures necessary to depress consumption and increase investment, and partly because of Latin America's greater dependence on world markets.

The Soviet Union and Eastern Europe have recently begun to forsake their postwar trade isolation, creating a situation evidenced by a gradually expanding volume of trade not only with traditional trading partners, but also with primary producing countries, and by the alteration of the product-mix of their trade. The Soviet Union and Eastern Europe have begun to increase their capital goods export capabilities and have also imported in recent years greater quantities of primary products. Latin America has also expanded its trade in recent years, albeit more modestly, but continues to be plagued by surpluses of primary products, which constitute the main export commodity group.

Trade between the two areas has always been modest, as can be seen in Chart 1. In the prewar period Latin American exports to and imports from the Soviet Union and Eastern Europe were only slightly more than 1% of its total exports and imports as well as an equally small proportion of Soviet and East European trade. Until 1954, trade accounted for even a smaller proportion. Only since 1954 has the trade been sufficiently large to merit more than mere statistical attention.

Despite the still small volume of trade, the economic relations of Latin America with the Soviet Union and Eastern Europe have been the subject of a great deal of attention since 1954. Much of this discussion has been in the popular press and has tended to emphasize the . . .

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