THE GOSBANK AND INTERNATIONAL SETTLEMENTS OF THE USSR

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000700100312-2
• Release Decision: RIPPUB
• Original Classification: R
• Document Page Count: 5
• Document Creation Date: December 22, 2016
• Document Release Date: October 21, 2011
• Sequence Number: 312
• Publication Date: January 26, 1953
• Content Type: REPORT

Declassified in Part - Sanitized Copy Approved for Release 2011/10/25: CIA-RDP80-00809A000700100312-2
CLASSIFICATION zETRl-Ir.n
SECURITY II&O.IMTION
CENTRAL INTELLIGENCE AGENCY
INFORMATION FROM
FOREIGN DOCUMENTS OR RADIO BROADCASTS
COUNTRY USSR
SUBJECT Economic - Finance
HOW
PUBLISHED Monthly periodical
WHERE
PUBLISHED USSR
DATE
PUBLISHED Aug 1952
LANGUAGE Russian
TNIS DOCYNIAT CONTAINS IIIOIISTION AIIIrn Nt INS Ntl1ONAL OIIdO
OF UK YNInD STAIRS WITHIN Txm
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01 In CCOTINIR 111 ANT NAN... TO AN YN AYMQIICIO IINtON It INO
YIIITI0 ST LAN. NlINODYrnON 01 THIS IOAN It INONIIITI D.
CD NO.
DATE OF
DATE DIST''4Jan 1953
NO. OF PAGES 5
SUPPLEMENT TO
REPORT NO.
THIS IS UNEVALUATED INFORMATION
THE GOSBANK AND INTERRATIONAL SETTIEMERTS OF THE USSR
The negotiation of settlements with foreign governments is one of the most
important functions of the Gosbank USSR. Other functions are: maintaining for-
eign currency reserves, arranging for the expedient investment of foreign cur-
reucy, timely replenishment of foreign currency reserves, and control of correct
and economical utilization of foreign currency reserves.
International settlements of the Soviet Union are concerned primarily with
foreign trade operations. The Gosbank accumulates currency as a result of ex-
port trade and services rendered abroad and makes payments, as directed by
Soviet organizations, for imports from abroad and n',so for services rendered by
x'oreign organizations and individuals.
The Gosbank handles international settlements involving (1) long- and short-
term credits extended by the Soviet Union to socialist and democratic countries
and credits which the USSR has received in foreign countries.
The Gosbank handles money transfers to pay the expenses of diplomatic, trade,
and other USSR representatives in foreign countries; money transfers from abroad
to pay the expenses of representatives of foreign countries in the USSR; money
orders; sale and purchase of checks; letters of credit, and other payment docu-
ments.
In the postwar years, foreign trade turnover increased considerably; and in
1949 it more than doubled the prewar level. The trade turnover with the People's
Democracies, which constituted about 70 percent of all USSR foreign trade, shoved
a?remarkcble increase, and it has increased continuously since then. At present
(1952), the foreign-trade turnover of the Soviet Union is above 18 billion rubles
a year, and continues to grow.
STATE
ARMY
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In addition to carrying on foreign trade with the People's Democracies, the
Soviet Union renders extensive aid to these countries by establishing long-term
credits and loans on easy terms.
The fundamental difference between the international settlements of the USSR
and the People's Democracies, and between the USSR and the capitalist world, is
the same difference that underlies the economic and political systems of each
bloc. The USSR's settlements with the outside vorl-l are carried out on the basis
of currency monopoly, in the same way as the total trade turnover of the Soviet
Union with the outside world is carried out on the basis of state monopoly of
foreign trade. The USSR grants to its Gosbank the exclusive right to make for-
eign settlements in gold, silver, and foreign currency, with payment documents
made out in foreign currency.
Apart from the Gosbank, only the Bank for Foreign Trade USSR can make set-
tlements with foreign countries.
Interrational settlements are made on a noncash basis, and only the balance
of accounts is covered by the import or export of gold. Payments for exported
and imported goods and services and also settlements for credit and loans are
arranged through bank accounts. For this purpose the Gosbank USSR maintains cor-
respondence relations with the large commercial banks of many countries.
Thr proceeds received by Soviet foreign trade associations for goods ex-
ported from the USSR, and also all other amounts payable to Soviet organizations
or individuals in USSR territory, in whatever currency these payments are made,
are credited to the accounts of the Gosbank USSR in foreign banks (or to the ac-
counts of the Bank for Foreign Trade), and the ruble equivalent of the credited
amount is paid out to the corresponding recipient in the USSR by crediting his
account in the Gosbank or the Bank for Foreign Trade.
Payments for goods imported into the USSR and other payments to foreign or-
gauizations or individuals abroad are made with foreign-currency funds availuble
in foreign banks for the account of the GosbankUSSR. Organizations r individ-
uals who instruct the Gosbank to pay a definite sum. abroad make a corresponding
payment in rubles.
The conversion of rubles into for-ign currency in foreign settlement trans-
actions, and also the conversion of foreign currency into rubles, is made at an
exchange rate set by the Gosbank USSR. The rate of exchange of the ruble in re-
lation to foreign currency is determined on the basis of the gold content of the
ruble, established by a decree of t'.^e Council of Ministers USSR on 28 February
1950, at the rate of 0.222168 gram of pure gold, and of the gold content of the
corresponding foreign currency. If the actual rate of a foreign currency en the
foreign market deviates from its gold content, a corresponding change may be
made by the Gosbank in the exchange rate of this currency for the ruble.
Settlements between the Soviet Union and the People's Democracies for recip-
rocal commodity deliveries are made by clearing accounts. The purpose of these
clearing operations is to permit the Gosbank USSR and the corresponding state
banks of the People's Democracies to open special accounts for each other, to
which payments are credited, for the benefit of each country and through which
payments are made to organizations within each country. For instance, settle-
ments for trade turnover between the USSR and Bulgaria are carried out by clear-
ing accounts which are opened in the Gosbank USSR and also in the Bulgarian
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National Bank. When a Soviet foreign trade organization makes a payment to the
Gosbank for goods received from Bulgaria, the amount ie entered in the clearing
accounts of the Bulgarian National Bank, which, on receiv!n; notification from
the Gosbank, pays out to the Bulgarian export organization a corresponding sum
of Bulgarian leva. On the other hand, amounts paid by Bulgarian foreign trade
organizations for goods imported into Bulgaria from the USSR are credited by the
Bulgarian National Bank to the clearing account of the Gosbank USSR, which is
notified accordingly. On the basis of this-information, the Gosbank pays to the
Soviet foreigp trade organization the amount received from Bulgaria in a cor-
responding payment by crediting it on the settlement accounts of this organiza-
tion.
Since the total cost of Soviet goods deliveries to each of the People's
Democracies in the course of a year must be equal to the sum of deliveries made
by each of these countries to the JSSR, the amounts credited by the Gosbank to
the clearing accounts of banks of the specified countries must be equal, at the
end of the year, to the amounts which each bank credited to the clearing account
of the Gosbank.
In such a way, the total reciprocal claims between countries, resulting from
the exchange of goods between them, are canceled out, by bookkeeping entries,
without the transfer of currency or gold.
If an unpaid balance remains at the end of the year, this balance must be
covered in a 3-month period by a goods shipment from the debtor country to the
creditor country.
Clearing settlements between the USSR and the People's Democracies facilitate
trade transactions and reciprocal commodity shipments. This method of account-
ing, based on previously determined commodity quotas and delivery dates, makca
it possible for the USSR to coordinate its national economic plan with the plans
of these countries individually, as well as for the People's Democracies to co-
ordinate their national economic plans among themselves.
Inasmuch as the reciprocal delivery of goods, payments for which are made
through clearing accounts, may not occur at the same time or may not be equal in
amount, one country or the other may find itself the creditor or debtor. Under
the terms of the planned economy of the USSR and the People's Democracies, it
is possible to predetermine during which periods and to what extent each country
participating .n the bilateral clearing transactions will be either creditor or
debtor. In the agreements on reciprocal commodity deliveries between the USSR
and the People's Democracies, a limit is established to prevent the oversupply-
ing of one party by the other, and a liability limit is also established in
clearing accounts. Exceeding of this limit indicates irregularities in the
course of fulfilling the plans for reciprocal commodity deliveries between coun-
tries.
The limit of indebtedness in clearing accounts thus makes it possible for the
participating countries to take coordinated action to bring the commodity deliv-
eries in line with the agreements made.
The prices of goods delivered in accordance with trade agreements between
the USSR and the People's Pemocracies are based on rubles, on a level guarantee-
ing the interests of both countries. These prices are stable and not subject to
the fluctuations characteristic in capitalist economy.
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The Soviet Union also has clearing agreements with some capitalist coun-
tries; for example, with Sweden, Norway, Denmark, Holland, Italy, and others.
However, the use of clearing accounts with these countries is more limited than
similar transactions with the People's Democracies because the currencies of
these countries, as in the majority of capitalist countries, are closed, i. e.,
they cannot be f aely converted into other foreign currencies. Therefore the
export of goods into these countries with payment in their national currencies,
without corresponding agreements on the method of accounting and payment, en-
tails the risk of immobilizing funds in this currency for a lengthy period.
True to the Stalin policy for preserving peace between nations, and of
broadening trade relationships with all countries, the Soviet Union has con-
cluded trade and payment agreements with a number of capitalist countries.
The clearance agreements transacted by the Gosbank with these countries
provides for a settlement of counterdemands without need for transfer of for-
eign currency.
As for the balance of reciprocal demands which are not paid off by a goods
shipment from the participant debtor, the Soviet Union stipulates that it is
the right of the creditor country to receive payment in free foreign currency or
in gold.
These clearing settlements are made in the national currency of the coun-
tries with which agreements are concluded. The conversion of the balance of
clearing accounts into foreign free currency or into gold is made at a rate of
exchange. previously agreed upon.
The settlements of the USSR with capitalist countries for goods and services
are carried out in clearing accounts and in regular correspondence accounts of
the Gosbank, mainly on the basis of letters of credit.
The method of cash collections in settlements with these countries is rarely
used, and, when it is, the necessary documents as a rule are sent to the bank of
the importing country for delivery of goods against payment due for the total
amount of the goods.
The international settlements dealing with the extension of credit by the
USSR to the People's Democracies are handled in approximately the same manner
as payment settlements with these countries for the shipment of goods.
After the acceptance by the recipient of bills for goods shipped by credit
agreement, these bills are not paid by clearance, but are returned to the Gos-
bank USSR, where the total amount is entered to the credit of the country con-
cerned.
When a country pays off its credit account to the USSR by a shipment of
goods, the cost of such goods is applied against payment of the indebtedness
either directly or through the clearing accounts of the country concerned with
the Gosbank USSR.
Noncommercial settlements with the People's Democracies are handled by the
Gosbank USSR either in rubles through clearing accounts or through separate ac-
counts for noncommercial payments.
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With capitalist countries, noncommercial settlements are made in their na-
tional currencies through correspondence accounts of the Gosbank in the banks
of these countries.
Concentration'in the Gosbank USSR (and, in part, the Bank for Foreign Trade)
of all international currency transactions of the Soviet Union, together with
the foreign trade monopoly, makes it possible (1) to have precise information at
any time concerning the status of payment and accounting balances of the USSR,
(2) to regulate the incoming and outgoing foreign currencies, and (3) to control
the replenishment or use of foreign currency reserves according to the demands
of the national economic plan.
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