Comecon

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The Council for Mutual Economic Assistance (Russian: Сове́т Экономи́ческой Взаимопо́мощи, tr. Sovét Ekonomícheskoy Vzaimopómoshchi, Russian: СЭВ, tr. SEV; English abbreviation COMECON, CMEA, or CAME) was an economic organization from 1949 to 1991 under the leadership of the Soviet Union that comprised the countries of the Eastern Bloc along with a number of communist states elsewhere in the world.

The descriptive term was often applied to all multilateral activities involving members of the organization, rather than being restricted to the direct functions of Comecon and its organs. This usage was sometimes extended as well to bilateral relations among members because in the system of socialist international economic relations, multilateral accords – typically of a general nature – tended to be implemented through a set of more detailed, bilateral agreements.

Moscow was concerned about the Marshall Plan. Comecon was meant to prevent countries in the Soviets' sphere of influence from moving towards that of the Americans and South-East Asia. Comecon was the Eastern Bloc's reply to the formation in Western Europe of the Organization for European Economic Co-Operation (OEEC), a prelude to the European Economic Community (founded in 1957) and the Organisation for Economic Co-operation and Development (OECD) (founded in 1961).

The Comecon was founded in 1949 by the Soviet Union, Bulgaria, Czechoslovakia, Hungary, Poland, and Romania. The primary factors in Comecon's formation appear to have been Joseph Stalin's desire to cooperate and strengthen the international socialist relationship at an economic level with the lesser states of Central Europe, and which were now, increasingly, cut off from their traditional markets and suppliers in the rest of Europe. Czechoslovakia, Hungary, and Poland had remained interested in Marshall aid despite the requirements for a convertible currency and market economies. These requirements, which would inevitably have resulted in stronger economic ties to free European markets than to the Soviet Union, were absolutely unacceptable to Stalin, who in July 1947, ordered these communist-dominated governments to pull out of the Paris Conference on the European Recovery Programme. This has been described as "the moment of truth" in the post-World War II division of Europe. According to the Soviet view the "Anglo-American bloc" and "American monopolists ... whose interests had nothing in common with those of the European people" had spurned East-West collaboration within the framework agreed within the United Nations, that is, through the Economic Commission for Europe.

However, as always, Stalin's precise motives are "inscrutable" They may well have been "more negative than positive", with Stalin "more anxious to keep other powers out of neighbouring buffer states… than to integrate them." Furthermore, GATT's notion of nondiscriminatory treatment of trade partners was incompatible with notions of socialist solidarity. In any event, proposals for a customs union and economic integration of Central and Eastern Europe date back at least to the Revolutions of 1848 (although many earlier proposals had been intended to stave off the Russian and/or communist "menace") and the state-to-state trading inherent in centrally planned economies required some sort of coordination: otherwise, a monopolist seller would face a monopsonist buyer, with no structure to set prices.

Comecon was established at a Moscow economic conference January 5–8, 1949, at which the six founding member countries were represented; its foundation was publicly announced on January 25; Albania joined a month later and East Germany in 1950.

This page was last edited on 14 June 2018, at 05:25 (UTC).
Reference: https://en.wikipedia.org/wiki/Comecon under CC BY-SA license.

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