The West and Eastern Europe as an
The makers of Soviet foreign trade policy seem in the last decade to have been oscillating between two magnetic poles, whose powers both to attract and repel have constantly fluctuated. On the one hand there is the allure, even in recession, of Western plenty and dealing with the West offers large potential economic gains, but at a political risk. On the other hand there is the burden of Empire in Eastern Europe*: here the potential unity of the Soviet bloc must be maintained, at a considerable economic cost to Moscow. To complicate the Soviet policy‐ makers' choices (and to overstretch an already well-stretched metaphor), these two magnetic poles both attract and repel one another.
The nature of the restless triangular relationship is the subject of the present chapter. It will be argued that Soviet policy choices in foreign trade in the 1980s are likely to continue to entail an awkward series of compromises between the two spheres of activity.
It should be remembered throughout that these are the trade policy decisions of a country whose trade is less important to it than most countries. The exact share of trade in the economy is not something that can be easily measured. (The arithmetic means of merchandise imports and exports, as a percentage of Gross National Product (GNP), is a conventional measure.) The fact that domestic transactions are carried out in prices that bear no systematic relationship to the prices of foreign transactions makes such estimates problematic. For the late 1970s it is possible to come up with percentages that range from 4 to 12. The lowest figure is the outcome of dividing official Soviet trade data (converted into dollars at the official exchange rate) by US estimates of Soviet GNP in US prices (for 1978). The highest figure is V.G. Treml's calculation (in principle, a more meaningful one) in terms of domestic rouble prices ( Neuberger and Tyson 1980). But even the higher figures portray the USSR as relatively independent of foreign trade - as is usual with very large countries.____________________