The Council for Mutual Economic Assistance, known as. “CMEA” or, more commonly, “Comecon”, was founded in. January 1949 by the USSR, Bulgaria,
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European studies, 8, 1970 Comecon The Council for Mutual Economic Assistance was given fresh impetus by the challenge of integration in Western Europe. Eastern European cooperation is compared with integration in Western Europe. Finally there is the question of how to reform Comecon to align it with the present movement of economic reform in Eastern Europe. The origins The Council for Mutual Economic Assistance, known as “CMEA” or, more commonly, “Comecon”, was founded in January 1949 by the USSR, Bulgaria, Czechoslovakia, Hungary, Poland and Rumania. Albania joined in April 1949 and East Germany in September 1950. In May 1956 Communist China and Yugoslavia became “observers”, North Korea and North Vietnam following them in 1957. Yugoslavia withdrew in 1958 and did not renew its tion as an observer until 1964. China, North Korea and North Vietnam gradually withdrew after 1960 when the Sino-Soviet dispute came into the open. Albania, which supported the Chinese in the quarrel, withdrew abruptly in 1961. In 1962 Outer Mongolia was admitted to, and still retains, full membership. The purpose of Comecon as defined in Article I of the Statutes adopted in 1960 is “by uniting and co-ordinating the efforts of the member countries” to promote the lopment of the national economy and the acceleration of economic and technical progress in the member states; the acceleration of industrialization in the less developed member states, an increase in the productivity of labour and an improvement in the welfare of the peoples of the member states. The Article goes on to say that “the Council for Mutual Economic Assistance is established on the basis of the sovereign equality of all the member countries of the Council”. Comparison with the EEC Although the general aim of promoting economic welfare as set out in the Comecon Statutes is similar to that of the 1 EEC as set out in the Treaty of Rome (defined in Article 2 of the Treaty as being “to promote throughout the munity a harmonious development of economic activities, a continuous and balanced expansion, an increased stability, an accelerated raising of the standard of living and close relations between its member states”) there is an important difference between the method proposed to achieve the desired end. Whereas the Treaty of Rome provides for the gradual establishment of a Common Market within which common policies will be accepted by the member states and many of the functions of economic management progressively assigned to common institutions, the Statutes of Comecon go no further than to authorize the Council to organize cooperation between the member states and to recommend joint measures in specified fields of activity. This is essentially a difference between integration and co-operation. It may appear paradoxical that the “authoritarian” states of Eastern Europe should adopt a system so much more “permissive” than that adopted by the six democratic West European States, but the Statutes of Comecon assume that the member states, under the rule of Communist Parties, are already in effect politically integrated and that for this reason they will find no difficulty in voluntary cooperation in economic and technical matters. This assumption is in fact too optimistic; the institutional structure of Comecon is not strong enough to implement proposals for integration or even for cooperation against the will of the member states. The Council, the supreme directing body, is posed of comparatively junior ministers from the member states; when major policy decisions are to be taken special meetings of senior government and party officials, not forming part of the Comecon organization itself, have to be arranged. The Council of Comecon has neither the status nor the powers of the Council of Ministers of the EEC.
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The institutions The headquarters office of Comecon is in Moscow. The Council1, composed of Vice-Premiers, Ministers of Foreign Trade, Chairmen of State Planning Commissions of the member states or persons of comparable rank, is required to meet at least once a year in each of the capitals of the member states in rotation. Since 1962 there has been an Executive Committee to maintain the direction of the organization’s work between meetings of the Council. A permanent Secretary, N. Fadeev of the USSR, controls a staff of experts and advisers drawn from the member states. In 1956 permanent Commissions, specializing in particular sectors of the economy, were established in the member states, located in countries where interest in the sector in question is particularly strong (e.g. agriculture in Sofia, chemicals in East Berlin, coal in Warsaw, machine-building in Prague). The Commissions which deal with major tions of common concern-electrical energy, foreign trade, economic problems, uses of atomic energy, co-ordination of research, statistics and foreign exchange-are in Moscow. For so large an area the permanent staff is comparatively small, perhaps no more than a third of the number employed by the EEC in Brussels. The layout of the organization tends to emphasize the presence of the one very large Power in its midst, for while the headquarters of the EEC is in Belgium, one of the smaller of the EEC states, the headquarters of Comecon and an important part of its institutions are in the USSR. The powers of the central institutions of Comecon over the member states are limited not only by the composition of the Council but also by Article IV of the Statutes which lays down that (a) the recommendations adopted by the member countries of the Council shall be implemented by the governments in accordance with national legislation and (b) the effects of recommendations and decisions shall not extend to countries which have declared their lack of interest in a matter considered by the Council. The ness of the Council’s authority has had contrary effects. In the first place although no single country can exercize a veto in the Council, it can prevent any recommendation from being uniformly applied throughout the area. Secondly, the single most powerful member of the Council cannot “constitutionally” use the Council to impose a decision on another member. Thirdly, it is extremely difficult for those in Eastern Europe who wish to see the area more closely integrated (as distinct from more operative) to use the machinery of the Council for this purpose. Development 1945-1956 In the period from 1945 to 1949 when the USSR was establishing the regimes in Eastern Europe which gave it effective political and military control of the area there was no plan to integrate their economies on the lines adopted by the EEC. In many ways Eastern Europe was cut off from the rest of the world and developed methods in economic planning and foreign trade which gave it a 1 See insert. 1 unique and exclusive character of its own. As a result of this isolation it was natural that the countries of Eastern Europe should trade with each other much more than the outside world. On the other hand each country tned to reconstruct its economy and to hasten the process of industrialization in accordance with its own national plans, and this led to a high degree of national self-sufficiency or autarky. In the first period of Comecon’s existence, which coincided with the last years of Stalin’s life, the tion smaller and weaker than it is today, could do virtually nothlng to influence economic developments in Eastern Europe except to try to co-ordinate the lists of commodities to be exchanged between the member states. Apart from a meeting in Sofia in November 1950 to discuss inter-regional trade no meeting of the Council took place between the end of 1949 and the spring of 1954. Not only was no progress made in regional planning in this period: under pressure from the USSR the economies of the states became even more distorted by the priority given to heavy industry. With the death of Stalin and the ending of the Korean War in 1953 there was a widespread reaction in Eastern Europe against the hardships endured by the ordinary consumer. A new phase began. Now for the first time consideration could be given to the supply of consumer goods and the rationalization of production in order to reduce costs. The Council of Comecon awoke from its long sleep and began to meet more frequently, discussing the construction of a unified electricity grid, encouraging the member states to conclude long-term trade agreements with each other and beginning to get to grips with the idea, which was to prove very troublesome later on, that there should be specialization in production as between the member states. 1956-1962 In 1956, undoubtedly spurred on by the progress of negotiations for economic integration in Western Europe the institutional structure of Comecon was at last ened and the first twelve standing commissions were established. Serious discussion of the plan to specialize production by country did not begin until 1957-1958. Here the Council met with disappointment because many of the states were reluctant to agree to specialization as it might involve the dis-continuance of industrial activities in a particular member state and their transfer elsewhere. In fact very little was achieved. Dissatisfied with progress the Party leaders of the member states met in Moscow in May 1958 and agreed that the economies of the member states should be reorganized and their national plans ordinated. The most important practical effect of the meeting was not so much a fundamental change in nization as a major investment boom which affected all the member states but left relations between them largely unchanged. It did not secure closer integration. Challenged by the rapid progress of the EEC in its early years the Party leaders of the Comecon states subjected their own system, which was evincing all the signs of stagnation, to a searching analysis in 1962. This time Mr. Krushchev put forward an ill-prepared scheme for a central planning institution for the whole of Comecon which would in effect have imposed the long-sought-for tion among the member states by authoritarian direction. To achieve such a centralized system it would have been necessary to alter the Statutes and give the organization an entirely new status. In fact discussion did not reach that stage for the Rumanians, fearing with considerable justice
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. . . Table 1 Comecon’s trade 1958 aod JJ68 Imports Exports 1958 I % I 1968 I % 1958 I % I 1968 I % $m Sm $m $m USSR Total 4,350 100 9,410 100 4,298 100 10,634 100 From/to EEC 222 5.1 908 9.6 271 6.3 758 7.1 UK 73 1.7 273 3.0 146 3.4 367 3.4 Other Comecon a 2,206 50.7 5,697 60.0 2,320 54.0 5,830 53.0 East Germany Total 1,680 100 3,387 100 1,890 100 3,783 100 From/to EEC 250 14.9 396 11.7 252 13.3 465 12.3 (Of which: W. Germany) 190 11.3 289 8.6 211 11.2 331 8.8 UK 33 2.0 38 1.1 12 0.6 31 0.8 Other Comecon a 1,055 62.8 2,426 71.5 1,229 65.0 2,708 71.4 Poland Total 1,227 100 2,853 100 1,059 100 2,858 100 From/to 138 EEC 11.2 363 12.7 120 11.3 293 10.3 UK 83 6.8 175 6.1 69 6.5 147 5.1 Other Comecon a 651 53.0 1,749 61.1 508 47.9 1,760 61.4 Czechoslovakia Total 1,357 100 3,077 100 1,513 100 3,005 100 From/to 122 9.0 289 9.4 7.3 9.6 EEC 110 290 UK 32 2.4 80 2.6 29 1.9 80 2.7 Other Comecon a 844 62.2 2,083 67.5 910 60.2 1,944 64.4 Hungary Total 631 100 1,803 100 684 100 1,789 100 From/to EEC 73 11.6 220 12.2 75 11.0 200 11.2 UK 20 3.2 52 2.9 12 1.8 42 2.3 Other Comecon a 399 63.3 1,189 65.9 388 56.8 1,214 67.5 Roumania Total 482 100 1,609 100 468 100 1,469 100 From/to EEC 51 10.6 423 26.3 56 11.9 255 17.4 UK 7 1.5 101 6.3 7 1.5 56 3.8 Other Comecon a 361 74.8 741 46.0 322 68.8 767 52.1 Bulgaria Total 367 100 1,782 100 373 100 1,615 100 From/to 30 8.1 196 11.0 EEC 25 6.7 126 7.8 UK 3 0.8 21 1.2 3 0.8 27 1.7 Other Comecon a 302 82.2 1,301 72.9 306 81.8 1,211 74.9 Comecon Total 10,172 100 23,921 100 10,315 100 25,153 100 From/to EEC 888 8.8 2,794 11.7 910 8.8 2,387 9.5 UK 252 2.5 739 3.1 277 2.7 749 3.0 Other Comecon a 5,891 57.9 15,187 63.5 6,060 57.7 15,433 60.5 a Not including Albania, Mongolia. 4
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