World Socialist Market

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

World Socialist Market


the system of planned commodity and monetary relations among the socialist countries.

The world socialist market emerged after World War II along with the world socialist system; it is based on the expansion of multilateral trade in goods and services and the development of other forms of economic, scientific, and technical cooperation among the socialist countries. An important part in the functioning of the world socialist market is played by each country’s monopoly on foreign trade, which provides the foundation for all foreign trade operations and for the entire structure of commodity-monetary relations among socialist states.

The development of the world socialist market, governed by the economic laws of the socialist mode of production, bolsters the entire world socialist economic system. Among the basic features of the world socialist market are the planned character of trade, as expressed in long-term trade agreements and yearly protocols on actual deliveries; the steady growth in trade volume as well as further development of its composition based on an intensified division of labor among the socialist countries; increasing market capacity and stability; and relative price stability. The development of the world socialist market reflects the objective process of increasing socialist economic integration.

The most important single component within the framework of the world socialist market is the market established among the member countries of the Council for Mutual Economic Assistance (COMECON). One of the chief means by which these states establish stable and mutually beneficial economic relations is through the coordination of their respective economic plans; on this basis, the division of labor among them is intensified and industrial cooperation and specialization are extended, especially in such sectors as machine-building, chemicals, radio and electronics, energy production and supply, raw materials processing, and transport.

The growth rate for trade on the COMECON market exceeds the growth rate for trade on the world socialist market at large. From 1951 to 1972, the foreign trade volume for all socialist countries increased by a factor of 7.2, but trade among COMECON countries grew by a factor of 9. Of total foreign trade conducted by the COMECON countries in 1972, approximately 63 percent was with one another. For Bulgaria, approximately 78 percent of foreign trade was with other COMECON countries; for Hungary, about 65 percent; for the German Democratic Republic, over 68 percent; for Cuba, over 61 percent; for the Mongolian People’s Republic, over 95 percent; for Poland, 59 percent; for Rumania, 47 percent; for the USSR, 60 percent; and for Czechoslovakia, 67 percent (see Table 1).

In 1971 trade between COMECON countries and Cuba was six times greater than in 1961 and exceeded 1.15 billion rubles. Cuba’s entry into COMECON in 1972 was expected to expand further its trade ties with the other members of the organization. Trade relations between the countries of the socialist community and the Democratic Republic of Vietnam, the Korean Democratic People’s Republic, and the Socialist Federal Republic of Yugoslavia are also growing stronger. Trade by these countries with COMECON members nearly doubled between 1966 and 1972.

Until 1960, the People’s Republic of China took an active part in the world socialist market. But starting in 1960, the leaders of the People’s Republic of China took the path of curtailing trade and other forms of economic, scientific, and technical cooperation with the USSR and other socialist countries. During 1971–72, China’s trade with the COMECON countries increased somewhat compared to 1970, but this still represented a volume four times less than that of 1960.

In addition to the increased volume of trade on the world socialist market, significant shifts are taking place in its commodity composition; these changes reflect processes associated with the advance of the scientific and technological revolution in the socialist countries, the intensification and perfection of the major forms of cooperation, and the development of socialist economic integration. An increasing proportion of both the exports and imports of the socialist countries is represented by industrial products, including highly processed finished goods

Table 1. Growth in foreign trade turnover of the socialist countries
1Billion rubles; at the rate of exchange as of Jan. 1, 1961, in each year’s relative prices 2Million rubles
Foreign trade turnover of all socialist countries, including COMECON members110.830.443.364.878.0
Foreign trade turnover of all COMECON members17.525.137.257.368.3
Foreign trade turnover of COMECON members with other socialist countries15.417.525.537.745.7
Foreign trade turnover among COMECON members14.614.322.633.442.8

such as machinery, equipment, and consumer durables, while the proportion of raw materials, fuel, and food products has diminished. The increased share held by machinery and equipment in the imports of the very same socialist countries that are major exporters of such products attests to the intensification of industrial specialization and reflects the processes of integration. The share held by such industrial products in the imports of the German Democratic Republic, for example, rose from 13 percent in 1960 to 32 percent in 1972; such imports by Czechoslovakia for the same period rose from 22 percent to 34 percent.

In accordance with the comprehensive program of socialist economic integration adopted at the 25th session of COMECON in July 1971, additional productive capacity is being created for goods intended for export within the framework of the international socialist division of labor. This will not only increase production of goods to satisfy fully the demand being generated within the world socialist economy but will also extend and improve cooperation among COMECON members and accelerate economic integration among them. Thus a basis is being laid for the expansion of each COMECON member’s trade with every other member.

Prices on the world socialist market are based on the average commodity prices in effect on world markets. In trade among COMECON members, prices are contractually set; as a rule, these prices are adhered to for the entire life of a five-year trade agreement. The prices set in trade between COMECON members and the other socialist states are often established also on a basis of current world prices.

The comprehensive program for integration adopted by COMECON anticipates that member countries will continue to proceed on the principles of price formation in mutual trade now in effect, principles that establish prices on the basis of real world prices, with the negative influences of capitalist market conditions removed. At the same time, the member countries are undertaking a comprehensive study of the problems inherent in the further development of foreign trade pricing.

Cooperation among socialist countries in the area of international currency and credit relations plays an essential role in the development of the world socialist market, especially for trade among the COMECON countries. With the founding of the International Bank for Economic Cooperation in 1963 and the changeover to accounting in transfer rubles, international payments among COMECON countries can be reconciled on a multilateral basis; this has encouraged the expansion of trade among these countries.

Vigorously developing trade and other forms of economic cooperation among themselves, the socialist countries also seek to expand their foreign economic relations, including trade relations, with all other states interested in normalizing and expanding economic ties. Trade relations between the socialist states and the developing countries have expanded; in 1972, COMECON members’ trade with the developing countries exceeded 5.6 billion rubles, an increase over 1960 by a factor of 3.5. The COMECON countries have also provided these countries with technical assistance in the construction of more than 1,000 major installations in various branches of industry.

The pursuit by the USSR and the other socialist countries of a consistent policy of strengthening world peace and assuring international security establishes a basis for comprehensive development of economic relations and scientific and technological cooperation with the advanced capitalist countries. In the early 1970’s a significant expansion occurred in trade between the socialist countries and France, West Germany, Finland, Italy, and Japan, as well as with the United States. From 1961 to 1972 trade between the COMECON countries and the advanced capitalist countries grew by a factor of 3.5, with a 1972 volume of more than 16.5 billion rubles. Trade, along with other forms of economic relations between the socialist and capitalist countries, is based on mutual benefit and seeks to utilize the advantages of a worldwide division of labor. The development of such relations helps strengthen peaceful coexistence among states with differing social systems.


Materialy XXIV s’ezda KPSS. Moscow, 1971.
Kompleksnaia programma dal’neishego uglubleniia i sovershenstvovaniia sotrudnichestva i razvitiia sotsialisticheskoi ekonomicheskoi integratsii stran-chlenov SEV. Moscow, 1971.
Shagalov, G. L. Ekonomicheskaia effektivnost’ tovarnogo obmena mezhdu sotsialisticheskimi stranami. Moscow, 1966.
Vneshniaia torgovlia evropeiskikh sotsialisticheskikh stran. Moscow, 1967.
Popov, K. I. Razvitie ekonomicheskikh sviazei stran sotsializma. Moscow, 1968.
Ivanov, N. I. Mezhdunarodnye ekonomicheskie otnosheniia novogo tipa. Moscow, 1968.
Senin, M. V. Sotsialisticheskaia integratsiia. Moscow, 1969.
Tuchkin, G. M. Ekonomicheskaia effektivnost’ vneshnei torgovli. Moscow, 1969.
Zolotarev, V. I. Mirovoi sotsialisticheskii rynok. Moscow, 1969.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
Full browser ?