MOSCOW'S LIQUIDATION OF "MIXED COMPANIES"

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000500820234-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 1
• Document Creation Date: December 19, 2016
• Sequence Number: 234
• Content Type: REPORT

CENTRAL INTELLIGENCE AGENCY
INFORMATION REPORT
COUNTRY
SUBJECT
Approved For Release 2006/11/03: CIA-RDP80-00809AO00500820234-8
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. USSR/Rumania/Hungary
Mosco2w', Liquidation of "mixed Companies'
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REPORT NO.
Th41iquidation of Soviet-Rumanian companies (known as Sovroms) and Soviet-
Rungarla' companiesindicates.the.failure of pn experiment which Moscow
forced at, its 8stellites. The principal role of these companies (in which
the USSR holds fifty percent of the. shares) was the industrial operation of
properties formerly German owned.. Other mined companies developed oil deposits,
,rn ipyartis, or freight and navigation businesses in co-proprietorship.
2. It is true that the USSR got half.the profits and .also had a right to half the
production, strictly._at.production cost. But, in the. long run it ties found that
theme sdventac,ea did not makeup for the lose to RwTie.nia and ,Hungary of Soviet
specialist personnel which the plan. had produced.. the :esavtW soheme must, have
drain about ;dv,000 soviet technicians and specialists out of t;:e USSR for
assignment to these,compentes. In spite of hopes discounted in advance, the
native populations of the Satelll.te countries never showed any excess enthusiasm
for ensuring the relief of these Soviet tephnicisnas.
3. In the end, the Soviet Union got tired of keeping up a corps of specialists,
tn two Satellite.. states, for which It had plenty of use back home. It decided
to recall its people and give up the scheme of common operation. It,is very
likely that the Satellite governments concerned--especially that of Rumenia,
where there were so many of these companies--will encounter difficulties, in
view of the 'technological gap" caused by the departure.of these Soviet experts.
4. On the other hard, the change will have certain beneficial results. The dis-
proportion between local money and the ruble, which has been a real headache,
will eventually discppesr. Under this arrangement, the Soviet technician used
to benefit by an advantageous rate of exchange, which gave him ad advantage over
his Rwanisn colleague. The rise In the exchange rate of the ruble in Rumania
and Rungary will, however, still permit the USSR to drive a shrewd bargain at
the expense of its % tallites, by selling them its shares in the mizad companies
at an exchange rate highly favorable to . ^
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