NOTES ON SOVIET ECONOMIC PENETRATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP62S00545A000100090104-2
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 5
• Document Creation Date: December 9, 2016
• Document Release Date: July 17, 1998
• Sequence Number: 104
• Content Type: NOTES

Approved For Release 2000/09/11: CIA-RDP62SO0545g1rWM7 090f 046
Notes on Soviet Economic Penetration
Soviet GNP 1957 about $170 billions.
At present rate of growth, will be $225-235 billions.ILI 11 60,
Present exports (1957) of USSR about 220 of GNP, $4 billions.
Compares with about 4% for US, $18 billions. USSR needs only to
bring its exports to 5% of GNP to equal present export trade of
UK or West Germany.
USSR has extended considerable assistance to other Bloc
countries. Since early 1956 about $1.3 billions in credits plus
small amount in grants. Credits and grants to free world countries
about $1.5 billions over past 4 years.
Small burden on USSR. Not l than 2 of 1%o of GNP per year.
When Soviet spokesmen declare they are willing to provide anything
the underdeveloped countries request that is within the capability
of the USSR, they are not necessarily making an empty gesture.
Could double present size of foreign assistance program without
serious internal strain.
Soviet trade with free world now almost entirely on a
bilateral basis. So far, this has not prevented trade from ex-
panding rapidly. May be more restrictive.in the future. Trade
with underdeveloped countries now running about $700 millions a
year for USSR. Trade of Sino-Soviet Bloc as a whole with under-
developed countries about $2 billions a year. In contrast, trade
Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
 Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
between US, UK, and West Germany combined with underdeveloped
countries over $28 billions annually, (US, $13 billions total
trade. US exports to underdeveloped countries, about 2% of GNP,
imports about 1% of GNP). Tremendous room for Soviet expansion.
Ways:
1) Economic and military assistance program.
Credit program important here, but only one factor.
2) Since 1953 trade not directly related with
economic assistance has increased about 25% annually.
Bloc aid offers made to Turkey;, Iran far in excess of what
has been accepted. In Africa, offers to the Sudan, Morocco,
Tunisia and Lybia have not been accepted to date, despite internal
pressure for economic development and a growing need for foreign
assistance to carry out such programs. Only 16 Free World countries
have accepted Bloc credits; 95% has gone to 9 countries.
Technical Training Program
Over 400 non-military students from underdeveloped countries
now studying in the Bloc. USSR announced in the UN that it was
willing to receive 1,000 students and trainees. Egypt, Syria,
Indonesia, Sudan, Yemen. Each year, over 4,000 overseas Chinese
go to Communist China to study.
Trade with Sino-Soviet Bloc and the US as Per Cent of Total Trade
1957
Bloc US
Afghanistan 40
Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
 Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
1957
Bloc
US
Burma
10
NA (was 1% in 1956)
Egypt
36
6
Greece
8
18
Iran
15
13
Iceland
34
12
Syria
14
9
Turkey
13
29
Yugoslavia
22
24
Commodity Composition to Underdeveloped Countries
USSR Exports
Rolled steel
Cement
Cotton textiles
Machinery
Petroleum
USSR Imports
Food products
(fish, sugar)
Crude materials
(cotton)
Satellites
Industrial products Foodstuffs and
crude materials
US and Sino-Soviet Bloc Aid
Totals, 1 July 1955 - 31 Dec 1957
During this 212 years; military plus economic:
Bloc to Free World Countries, $1.9 billions
Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
 Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
US Gov't. (MSA, PI)+80, Ex-Im. bank) $8.0 billions)
) $10.5
US & Western Europe Financial Institutions and )
)
other Free World Gov'ts. $2.5 billions)
Major US aid to South Korea, Viet Nam, Taiwan $3 billions.
US and Sino-Soviet Bloc Credits and Grants
(millions of $)
us
Afghanistan
47
Burma
}3
Cambodia
Ceylon
Egypt
India
4+1g
Indonesia
124
Syria
Yugoslavia
276
1 July 1955 - 31 December 1957.,.---
A. Usually prescribed on an integrated basis:
1. Line:,df credit
2. Technical assis
nee anck`traii ing
Increased trade oppiItunities.
161
42
22
19
437
272
log
294
4
Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
 Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2
Has great appeal, particularly if underdeveloped country is
having difficulty in marketing its exportable products at adequate
In contrast,'US program more isolated. In particular, trade
usually a matter outside scope of responsibi]:ities of mutual
security officers.
`B. Almost entirely a credit program
1. Interest rates 2-zoo.
2. Repayment usually begins after project is in
operation.
3. Amortization period 12 years.
US interest rates higher. Development Loan Fund repayment
in 40 years, 30 years for Ex-Im. Bank.
C. Generally covers only Foreign Exchange Costs.
. Usually related to Industrial Development
Sugar mills, cement plants, etc. Not for sanitation,
sewage, housing, etc.
E. Independent of Military Pacts.
20% of Bloc credits for arms, 30%.Lof US for arils.
No free world underdeveloped country receiving Bloc
military or economic assistance is a member of a Bloc
m 'litary alliance. This pracl4 ce disarms many.
Approved For Release 2000/09/11 : CIA-RDP62SO0545A000100090104-2