1 The dearth of official data naturally imposes limitations on any study of this nature and forces some reliance upon secondary sources. Consequently, while this does preclude a detailed balance sheet of Polish-Soviet relations in terms of absolute value, at least the relative magnitudes of advantages and disadvantages accruing to Poland can be indicated.

2 See the pertinent sections in McNeill, W. H., America, Britain and Russia. Their Coopertion and Conflict, 1941-1946 (New York, 1953)Google Scholar; A. and Toynbee, V. (eds.), The Re-alignment of Europe (New York, 1955)Google Scholar. A review of Soviet foreign economic policy in the postwar period and of the activities in Eastern Europe is in the author's “Soviet Foreign Economic Policy,” The Political Science Quarterly, June 1958.

3 Economic agreements between the two regimes were signed in October, 1944, April, 1945, and July, 1945. A resume of earlier agreements has been compiled by J. Dolina, “Poland's Foreign Trade and Related Economic Treaties and Agreements, 1945-1955,” (first part) Polish Review, I, No. 4 (1956), 80-92. The trade pact of 1945 set the pattern for the next three years. It was a bilateral barter agreement stipulating a mutual exchange of commodities for a year, equalling a specified value in world prices. The collapse of Germany and the destruction of the Polish economy might have been expected to shift Polish trade towards the Soviet Union at this time. The dearth of traditional Polish exports precluded an immediate opening of trade with the West and Polish reconstruction initially depended on foreign aid ($478 million in UNRRA relief) and trade with the Soviet Union. The commodity composition of Polish-Soviet trade at this time reflected the Btuation. Polish imports were primarily raw materials and industrial equipment, and its exports consisted of raw materials and finished goods converted from imports. See Poland of Today, I, No. 6 (1946), 10; League of Nations, Monthly Bulletin of Statistics, XXVII (July, 1946), 275.

4 Estimates of Poland's gain from these revisions in terms of industrial investment value range from $6 billion to $9.5 billion. Further details about losses and gains involved are in Gluckstein, Y., Stalin's European Satellites (New York, 1932)Google Scholar; Mikolajczyk, S., The Rape of Poland (New York, 1948)Google Scholar; UNRRA, Economic Recovery in the Countries Assisted by UNRRA (Washington, 1946)Google Scholar; Douglass, D. W., Transitional Economic Systems: The Polish-Czech Example (London, 1953)Google Scholar; Betts, R. R. (ed.), Central and South East Europe, 1945-1949 (London, 1950)Google Scholar.

5 While an official statement placed the amount of Soviet dismantlement at $500 million by August, 1945 (Rzeczpospolita, August 24, 1945), a Polish official made known that an agreement had alloted to Russia 25 percent of the industrial equipment in the area, which had an estimated value of 6 percent of the wealth of the new territory. Przeglad Gorniczy (October, 1945), 230, quoting a speech by H. Mine, as reported in Spulber, N., The Economics of Communist Eastern Europe (New York, 1957), p. 29 Google Scholar.

6 Texts of the August, 1945, agreements are reprinted in Bulletin of the U. S. Department of State, XIV, No. 348 (March 3, 1948). The amounts were modified in March, 1948, and again in January, 1949, when the quotas of “reparations coal” was fixed at 6.5 million tons to be delivered annually. These were discontinued by 1954 when both Poland and the Soviet Union renounced German reparations, so that during 1946-53 period, it may be assumed that a minimum of 52 million tons were delivered at the special price. The latter . has been estimated to be one-eighth to one-tenth of world market prices. A rough approximation of the magnitude of Polish losses in this transaction is evident from the fact that from 1950 to 1953 the export price of Polish coal averaged about $18.00 a ton (U. N., Economic Survey of Europe in 1953, p. 231), which, therefore, would have brought in a revenue of about $468 million for the four years. With the fraction paid by the Soviet Union, the Polish loss in these four years may be estimated to be at least $400 million, to which may be added more than $250 million for the preceding four years when the coal export price was as low as $12 a ton.

7 A short-term loan of $28 million in hard currency was granted in March, 1947, to enable Polish purchase of heavy equipment in the West. Economic agreements in 1946 and 1947 also granted Soviet delivery of grains on credit, the cancellation of wartime debts accumulated by Polish forces attached to the Red Army, the return of railway stock acquired by the Soviet Union in 1939 and the reduction in the quotas of “reparation coal” deliveries. One Polish estimate places the amount of Soviet grain delivered to Poland from 1945 to 1948 to be about 1.8 million tons. Lychowski, T., Handel Miedzynarodowy (Warsaw, 1951)Google Scholar, part 2, p. 202.

8 The Soviet share of Polish trade declined to 58 percent in 1946 and fell to less than 27 percent in 1947. In 1938, less than 2 percent of Polish imports and exports were involved with the Soviet Union. Alton, T., Poland's Postwar Economy (New York, 1955), p. 280 Google Scholar.

9 Details of the various Soviet techniques are scanty but there is information that before 1948 Poland had to pay 131 zloty for each dollar of imports from the Soviet Union while the latter paid the equivalent of 75 zloty for each dollar of Polish goods. U. S. Congress, House Report N. 1845, Final Report on Foreign Aid (Washington, 1948), p. 377. In 1952, Soviet prices for basic Polish chemicals were one-third or more below the price paid by other importers. It has been estimated that Polish losses from such unfavorable terms amounted to several hundred million dollars. Dolina, J., “Foreign Trade,” Poland, O. Halecki, ed., (New York, 1957), p. 463 Google Scholar.

10 The official communique on these agreements is in Mid-European Law Project, Economic Treaties and Agreements of the Soviet Bloc in Eastern Europe, 1945-1951 (New York, 1951), 2nd ed., p. 31.

11 Alton, T., Polish Postwar Economy (New York, 1955), p. 150.Google Scholar

12 U. N., Economic Bulletin for Europe, IX, No. 3 (1957), 24–25.Google Scholar

13 The Polish trade deficit with the Soviet Union from 1945 to 1948 exceeded $54 million. N. Spulber, The Economics of Communist Eastern Europe, p. 459.

14 With the 1949 production at 100, increases in certain branches were registered as follows: engineering and metal manufacture, 421; electrical equipment, 367; metallurgy, 251; food processing, 229; textiles, 204; mining, 130. Economic Bulletin for Europe, IX, No. 3 (1957), 44-45.

15 It was assumed that value of projects would be only four-fifths of the actual expenditure during the period.

16 Approximately 11 percent of the Six-Year Plan investments for industry was assigned to armament production, a share equal to that designated for all of light industry during the period.

17 This is illustrated particularly by the decrease in the percentage of coal exports relative to production, due to the twin factors of increased internal consumption and lag in production expansion by comparison with industry as a whole. In 1950, approximately 34 percent of coal produced was exported, but this fell to less than 28 percent in 1954. From 1949 to 1954, domestic coal consumption rose by 44.4 percent while coal output had risen only by 12.3 percent. The plan had scheduled an increase in annual output from 74.1 million tons to 100 million tons by 1955. Production in that year fell over 5 million tons short of the goal. See V. Winston, H., “The Polish Bituminous Coal-Mining Industry,” The American Slavic and East European Review, XV, No. 1 (February, 1956), 57– 78 Google Scholar; Rocznik Statystyczny, 1957, p. 62.

18 Per capita production of grains fell from 470 metric tons in 1948 to 386 metric tons in 1953. A parallel decline in consumption of agricultural products occurred after 1950. I Per capita consumption in 1950 was approximately 166 kilograms of grains and 38 kilograms of meat. Figures in 1953 fell to 161 kilograms and 36 kilograms, respectively. Poland had exported up to 7 percent of the grain harvest before World War II. In 1955, it was importing grains in a volume that comprised over 12 percent of the harvest that year. The fall in living standards was likewise illustrated by indices in living costs and real wages. With 1949 as an index of 100, the cost of living had risen to 228 by 1953, while the index of real wages, had fallen to 88. Cf. N. Spulber, Economics of Communist East Europe, p. 379; Economic Bulletin for Europe, IX, No. 3, 35; Z. Gorski, “Polski import i jego problemy,” Handel £agraniczny, No. 5 (1956), p. 15; T. Palacz, “Problem importu zboz,” Handel Zagraniczny, No. 10 (1956), p. 16.

19 The grain imports amounting to 2.3 million tons from 1950 to 1953 were less than one-half of the 4.7 million tons imported in the last two years of the plan. Handel Zagraniczny, No. 10 (1956), p. 16.

20 For example, the original plan called for a 37 percent increase in labor productivity for coal mining. Due to deteriorating working conditions and the absence of mechanization, this productivity fell below the 1949 rate. Economic Bulletin for Europe, IX, No. 3, 26.

21 The trade data is based on the following sources: Institut National de la Statistique et des Etudes Economiques, Memento Economique: La Pologne (Paris, 1954), p. 142; League of Nations, Monthly Bulletin of Statistics, XXVII (1946), p. 275 Google Scholar; U. N., Economic Bulletin for Europe, III (1948), No. 2Google Scholar, Table XXII and IX (1957), No. 3, p. 37; U. N., Statistical Tearbook, 1956 (New York, 1957), p. 399 Google Scholar; U. S., Department of Commerce, International Reference Series, VII, No. 120Google Scholar; Rocznik Statystyczny, 1957, pp. 240-241; Handel gagraniczny, (1956), Nos. 2, 7, 8 and (1957), Nos. 2, 4; Zycie Gospodarcze, No. 8 (April 16-20, 1949); Poland Today, V, No. 6 (1950), p. 8; Polish Foreign Trade, No. 39 (2), 1957; Pisarets, I. et al, Pol'sha: ekonomika i vneshnjaja torgovlja (Moscow, 1955), pp. 95–99 Google Scholar; Halecki, O., ed., Poland (New York, 1957), p. 452 Google Scholar; Herman, L., The Foreign Trade of the U. S. S. R. (Council for Economic and Industry Research, Report #A-6) (Washington, 1954), pp. 90–91 Google Scholar; The Statist, CLXIV, No. 4107 (November 24, 1956), supplement

22 Published in Wirtschaftsdienst des Polnischen Informationsburos, No. 7 (July, 1956), as cited in Institut zur Erforschung der UdSSR, Sowjet Studien, No. 3 (July, 1957), p. 54; Glowny Urzad Statystyczny P. R. L., Rocznik Statystyczny, 1957 (Warsaw, 1957), pp. 244–248.Google Scholar

23 Machines and industrial equipment comprised about one-fourth of total imports in 1949. Their share rose to two-fifths by 1952 as imports of raw materials continued to comprise more than two-fifths of total imports. On the other hand, Polish shipments of coal, more than two-thirds of total exports in 1949, fell to less than one-half throughout the plan period. The volume of trade had jumped in 1951 to more than 77 percent over the previous year, and then declined almost 3 percent in 1952 and about another 5 percent in 1952. Cf. Tables 1,3; Economic Bulletin for Europe, IX, No. 3, 37

24 In 1953, food and consumer goods imports comprised almost 9 percent of total imports. The share of these items increased to more than 16 percent in 1954 and above 17 percent in 1955. Ibid.

25 The Six-Year Plan had initially scheduled an export surplus of $246 million in 1955 prices. Actually, exports covered a decreasing share of the cost of imports, falling from 90 percent in 1950 to 60 percent in 1955. Ibid.

26 Industry, agriculture and housing received 52 percent, 8 percent and 10^6 percent, respectively, in the total gross fixed investment during the Six-Year Plan. These were now scheduled to receive 48 percent, 12 percent and 14!^ percent. Compared to the previous plan, the rate of growth of industrial production was to decline by 55%. On the other hand, real wages were to rise by 30 percent, as comqared to a 14 percent rise effected previously. U. N., Economic Survey of Europe for 1956 (Geneva, 1957)Google Scholar, Chapter II, 4 and Appendix, 35.

27 No retreat from the collectivization program was yet countenanced, however, and the 23 percent of arable land that had been socialized by 1955 was to increase to 40 percent by 1960. News From Behind the Iron Curtain, V, No. 4 (April, 1956), 9.

28 Economic Survey of Europe for 1956, Chapter I, 18.

29 Output of coal in 1956 was 97.6 million tons, an increase of about 1 percent over the previous year but also 1 percent short of the goal. Some 5 million tons less coal were shipped, at an estimated loss of $100 million. These and other data are in U. N., Economic Survey of Europe for 1956, Chapter I, pp. 11-15.

30 Polish awareness of this situation and increased demands for more extensive adjustments that arose in 1956 is perhaps best illustrated by an article written by the Polish economist, Oskar Lange, “For a New Economic Program,” which appeared in July 16, 1956, issue of Zycie Gospodarcze. Gomulka's 1956 critique of economic developments is in Wladyslaw Gomulka Przemowienia (Warsaw, 1957), pp. 7-61.

31 Wages were increased by more than 18 percent in the year following October. Other efforts include a rise of 20 percent in textile production and 50 percent in durable goods in 1957, and the encouragement of small-scale free enterprise (including some 32,000 small shops for handicrafts and services). Most important of the various agricultural concessions have been new conditions for private farming. De-collectivization has reduced the number of cooperative farms from about 10,000 to 2,000 in less than a year. Other agricultural incentives obviously boosted production in 1957 to its highest level since the war: a 4 percent overall increase over the 1956 output and a 12.5 percent rise in grain production. Despite adverse weather conditions in 1958 leading to a lower yield per acre, an expansion in total area sown has led authorities to anticipate a further, slight increase in agricultural production for 1958. Cf. East Europe, VII, No. 4 (April, 1958), pp. 45-46; Washington Post & Times Herald, March 7, 1958; The New York Times, March 22, 1958; Trybuna Ludu, September 25 and 27, 1958; Zycie Warszawy, September 25 and 27, 1958.

32 See The New York Times, March 11, 1958, p. 3.

33 Cf. Gomulka's speech at the XII party plenum in Trybuna Ludu, October 16, 1958; The New York Times, February 16, 1958, and February 22, 1958; East Europe, VII, No. 6 (June, 1958), pp. 28-30. The official version of these changes is in E. Szyr, O zmianachw systemie zarzo-dania i kierowania gospodarki narodowej (Aktualne problemy politikye partii i rzadu, No. 24, July, 1958).

34 See Tables 13 and 15, Economic Bulletin/or Europe, IX, No. 3, pp. 39 and 40. Agricultural investment has risen more than 1 percent. The annual plan for 1958 scheduled the overall industrial production to rise by 5 percent while production of consumer goods will increase by 8.4 percent amid warnings from the leadership that the trend cannot continue beyond 1958 if the economy is to develop. The New York Times, December 31, 1957, p. 6.

35 Consumer imports rose from $63 million in 1956 to $128 million in 1957. The New York Times, February 16, 1958, p. 4. To the $ 179 million deficit in the balance of payment incurred during the Six-Year Plan was added a further deficit of $74 million in 1956. Rocznik Statystyczny, 1957, pp. 240-41.

36 Polish economists estimate a loss of $250 million in 1957 because of this development. The New York Times, January 23, 1957.

37 See Department of State Bulletin, XXXVI (March 18, 1957), p. 440. One estimate placed Polish loss from transit fees at over 110 million rubles. Neue Zeit, January 11, 1957, as stated in Sowjet Studien, No. 3 (July ,1957), p. 52.

38 Any estimate of the balance-sheet of Polish-Soviet economic relations to 1957 must contend with the absence of data as well as certain intangibles. Soviet support and recognition of Polish borders at the Oder-Niesse rivers contributed to Poland's greater industrial potential. The process of industrialization, obviously beneficial to the country in the long run, was aided to 1957 by Soviet credits amounting to about $900 million at official exchange rates ($525 millions of which Poland need not repay). On the other hand, the debit side of the Polish ledger includes a variety of techniques which accumulated Soviet profits. In addition to the $500 million of dismantled equipment officially admitted by the Poles, a conservative estimate of an additional $650 was lost by the shipment of “reparation coal.” Prices unfavorable to Poland were imposed in trade agreements, and while this defies concise calculation, one estimate places the Polish loss from this practice at about $500 million (J. Dolina, “Foreign Trade,” Poland, O. Halecki, ed., p. 463). To these must be added Soviet exploitation of transportation facilities, freight rebates, low transit rates, use of harbor facilities and merchant fleets. The imposed trade pattern was also an indirect loss since trade terms with bloc members were frequently less favorable than world market prices, and the Soviet Union also re-exported with a profit. The shift of some Polish trade to aid the development of Asian bloc industrialization was of direct benefit to Soviet interests. These lead to the highly tentative conclusion that the cost to Poland for its economic ties with the Soviet Union to 1957 exceeded $2 billion dollars in direct or indirect losses.

39 The largest single source in the West has been the United States which in 1957 and 1958 agreed to a total of $193 million in various type credits to be extended, mostly in the form of agricultural products and purchase of mining machinery. Other sources include the Canadian shipment of 350,000 tons of wheat on credit, $140 million in credit from private British sources (under-written by the government), $33 million from France (with negotiations for an additional $60 million), and even $5 million from Austria. See Polish Affairs, No. 8-9 (September, 1957), pp. 10-11; The New York Times, February 16, 1958, p. 1.

40 The revised Five-Year Plan called for an increase of exports by 46 percent as imports were to rise only 27 percent by 1960. The fall in the world prices of those raw materials exported by Poland, especially coal, has made plan fulfillment in 1958 still a matter of touch and go. See Gomulka's report to the XII party plenum in Trybuna Ludu, October 16, 1958. A current analysis of Polish trade problems is in Krynicki, J., Problemy nandlu Zagranicznego Polski (Warsaw, 1958)Google Scholar.

41 Gruliow, , ed., Current Soviet Policies (New York, 1956), II, 38 Google Scholar and 83.

42 The one concerned with coal is located in Warsaw while others are located in Budapest (timber), Berlin (chemicals), Prague (engineering) and Bucharest (oil).

43 Present indications in this budding “international division of labor” assign to Poland the production of turbines, generators, transport equipment and mining apparatus for other members of the bloc. See Economic Survey of Europe for 1956, Chapter II,p. 18. The extent to which East Germany and Czechoslovakia are already dependent upon Polish coal exports was indicated by the disruptive effects made upon their production plans by the 1956 decrease of these exports. East Germany extended $ 100 million in credits in 1957 to aid in the expansion of Polish lignite production and Czechoslovakia likewise granted a loan of $65 million for this purpose.

44 See Table 3. Recent information from the U. N. Economic Commission for Europe i (as reported in the London Times, September 26, 1958, and the New York Times, September ; 28, 1958) indicates that the trend of East European trade to shift towards Western Europe, i begun in 1953, has been reversed in 1956 and 1957 as the Soviet share of exports and im- j ports increased.

45 Polish-Soviet trade, amounting to approximately $614.6 million in 1956, was increased about $90.6 million (at official exchange rates) in 1957. The latest agreement to 1960 is calculated to assure Poland a flow of raw materials in that the Soviet Union has agreed to increase its exports in this category and to purchase more of Polish industrial products, the latter to comprise about 50 percent of Polish exports to the Soviet Union in 1959. Increase in trade turnover in 1959 is expected to be 30 percent over that of 1957. Additional details are in the New York Times, February 6, 1958; Current Digest of Soviet Press, X, No. 15 (May 28, 1958), p. 31; Zycie Gospodarcze, No. 42 (October 19, 1958), p. 3; Trybuna Ludu, October 15, 1958; Zycie Warszawy, October 15, 1958.

46 This is not to imply that greater economic self-assertion by Poland is out of the realm of possibility once its fundamental crisis is resolved. Although a number of imponderables does discourage specific predictions, certain long-range developments could lead to a reduction in Polish-Soviet ties. The continued industrialization of the bloc and the resultant strain upon the Soviet economy as a major source of supply is one of the possible factors that could promote such a reduction. This aspect is partly examined by D. Granick, “Economic Relations with the U.S.S.R.,” Resources and Planning in Eastern Europe, edited by N. Pounds and N. Spulber (Indiana U., 1957), pp. 129-49; and in the author's forthcoming study “The Soviet Bloc and Underdeveloped Countries: Some Economic Factors,” World Politics, (forthcoming). The continued relaxation of international political tensions likewise enhances Poland's ability to improve the foreign exchange position and to search for new markets. The success of these efforts, however, would also depend on Poland's ability to develop a commercial apparatus that could expedite trade with non-bloc markets that are outside governmental direction.