East-West-South

The first purpose of this book is to assses the prospects for cooperation in world development among the three groups of nation states — loosely but conveniently described as ‘East’ (the Soviet Union and Eastern Europe), ‘West’ (essentially the OECD countries) and ‘South’, (basically the developing countries or the ‘Third World’). Thus a special feature of the book is that it brings to the forefront a subject which is relatively little discussed (outside official documents) in the vast literature on development — the extent to which the market and socialist economies can combine forces in the raising of standards and the eradication of poverty in the world. The second purpose is to identify the extent of agreement, and the nature of the disagreements, among concerned scholars coming from the three different ’worlds’. The book contains, too, many illuminating insights into the general problems of development, of which increasing experience is being gained by informed people in all countries.

The 1930s obliged what is known as the West to become aware of its growing interdependence, but it took the Second World War to transform the resulting interdependence into an assumed solidarity: the European construction is the most elaborate manifestation; concertation within OECD shows the need, to manage this solidarity, of a permanent structure for dialogue.

We do not intend to deal in this paper with the overall picture of economic relations between the CMEA and developing countries. Its purpose is much more limited. It will be confined to an attempt at analysis of the interests of the CMEA countries underlying the economic relations between the two groups of countries. Notwithstanding the close interrelationship between political and economic factors influencing these relations, the analysis will be restricted to the economic interactions between the CMEA and LDCs.

This paper provides an overview of the present state and anticipated future trends of economic cooperation between the European CMEA countries (2) and the developing countries. Starting with an analysis of the international political and economic environment influencing the economic interaction of the two groups of countries, the paper reviews the major general, sectoral and institutional issues of economic cooperation. The conclusion is a forecast of trade for the 1980s, a quantified summary of tendencies disclosed in the foregoing.

We live at a time when an individual — having ample information at his disposal — is in an ever easier position to consider and discuss global problems; yet his possibilities of expressing the views of the groups he is talking about are ever diminishing. In the same way, it is difficult for him to rise — even if he wishes — above conflicting interests and to look for a synthesis if such a synthesis is even possible. Such limitations are felt even more by the author when the objects of his consideration are the developing countries, with their difficult problems of liberation and development on the one hand, and the complicated East-West relations (frequently ‘non-relations’), on the other hand.

Recurring financial problems are usually a surface phenomenon reflecting deeper malaise in the underlying economic structure. International financial problems are no exception to this general rule. The recurring payments difficulties in international transactions faced by the non-oil developing countries of the South cannot therefore be understood in isolation from the pattern of international trade and capital movements in which they have been caught.

There is no need to stress the importance of the role played by the transnational companies in world economic development from the standpoint both of the industrialised and of the developing countries. Few subjects have received more attention in recent years, as is shown by the voluminous bibliography and by the growing number of institutions engaged in analysing this phenomenon; these include the United Nations Centre on Transnational Corporations (CTC) and the Joint CEPAL/CTC Unit. In recent years CEPAL has published several papers dealing with the Latin American experience in this field (1).

Economic modernisation is a central concern of most developing countries. The critical situation in most of these countries — hunger, illiteracy, disintegration of traditional cultural and social structures — leaves no alternative but social, economic and technological modernisation. Of course technological modernisation will not automatically solve the problems faced by these countries; indeed inappropriate technological strategies may create more problems than they solve. The question is: what kind of technology is needed to cope with the present situation in these countries?

The following paper is based on a number of assumptions which should be stated as clearly as possible in summary fashion to facilitate discussion.

The international dissemination of cultural influences has enormously increased. Its ultimate cause is the advance of technologies in transport and electronic communications and growing urbanisation. Popular songs, styles in dress and hair styles, attitudes to divorce, abortion, homosexuality, drugs, even crimes, are spreading rapidly across the globe. While in previous ages the common culture was confined to a thin layer of the upper class, today it has reached the mass culture in many countries. In the huge underdeveloped regions of the South, however, the masses of people live in extreme poverty and cultural isolation, though a small upper class has become part of the international culture. Even among the élite, there are now moves to assert indigenous cultural values and to establish national and ethnic identities. It is partly a reaction against the rapid spread of the mass culture of the West.

It is six years since the 6th Special Session of the UN General Assembly adopted the ‘Declaration on the Establishment of the New International Economic Order’ and the ‘Plan of Action’. At the 29th session of the General Assembly the developing countries, supported by the socialist states, secured the adoption of the ‘Charter of Economic Rights and Duties of States’. Important decisions of all the subsequent sessions of the UN General Assembly, of the 4th and 5th sessions of the UNCTAD, and of the 5th and 6th conferences of the non-aligned countries, were devoted to problems of building the New International Economic Order (N 1E0). These documents have created a certain political basis for elaborating a complex of practical measures aimed at improving the position of the developing countries in the world economy and at securing for them new sources for economic, scientific and technological progress.

At the end of 1979, the General Assembly of the United Nations decided (1) to launch, at its special session in August 1980, ‘a round of global and sustained negotiations on international economic cooperation’. The holding of a special session had already been decided in 1977 for the purpose of adopting a new international development strategy for the Third Development Decade and to assess the progress made in various fora of the UN towards the establishment of a New International Economic Order.

Although there were occasional references to the rich North and the poor South of the world in earlier years, it was only during the Paris CIEC talks in 1977–78 that ‘North-South’ became a concept. The Paris talks were a political exercise from which the Soviet Union and her allies had been excluded. It is ironic to recall that only slightly earlier an attempt had been made to bury the notion that international politics must be seen in terms of an East-West conflict between the Soviet Union and the United States. Attention was then drawn to the multipolar nature of the situation and the new power of Europe, Japan, and China.

The purpose of this paper is to discuss major structural policy issues arising from changes in the international division of labour, technological innovations and energy scarcities. Emphasis will be put on the Western industrial countries. In view of their strength in the world economy, the ways in which they shape their structural policies for production and trade will affect directly or indirectly both the developing and the Eastern European countries.

The movement for a new international economic order has focussed greater attention on structural policy, on concepts of development of the developing nations, and on problems of restructuring of world industry. This increased attention to problems that were also considered important in the past stems from several causes.

Far from being an ephemeral phenomenon, Tripartite Industrial Cooperation (TIC) — the joint construction by Eastern Europe (1) and the West of industrial complexes in a great variety of Third World countries — constitutes a practice which is tending to become generalised.