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East-South relations at UNCTAD: global political economy and the CMEA

Published online by Cambridge University Press:  22 May 2009

Robert M. Cutler
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UNCTAD provides a unique focus for studying the response of the Council for Mutual Economic Assistance (CMEA) to the New International Economic Order. Not only has UNCTAD played a role in stimulating East-South trade links since its foundation in 1964 but the East European members of the CMEA, collectively incarnated at UNCTAD as Group D, have there transformed their behavior with respect to the less developed countries. This transformation is evident in the evolution of Group D's position across four sets of negotiations: those on commodities trade and the Common Fund, on the Generalized System of Preferences, on the Code of Conduct for Liner Conferences, and on the Code of Conduct for Transfer of Technology. Contrasts between the conduct of the CMEA and that of the EEC at UNCTAD highlight the significance of Group D's use of international law to remake the world trade system. Implicit in this strategy is the question of domestic state trading structures, which appears to be a principal factor motivating issue-specific coalitions at UNCTAD between the CMEA countries and the Group of 77. The CMEA countries use UNCTAD to reinforce their sovereign prerogatives as states in a transnational world, refashioning at the same time the transnational environment in which states conduct mutual relations, in order to reconstruct in their own favor the international regimes governing various aspects of trade and development.

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International Organization , Volume 37 , Issue 1 , Winter 1983 , pp. 121 - 142
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Copyright © The IO Foundation 1983

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References

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4. Group D includes the member-states of the CMEA at the time of the foundation of UNCTAD in 1964: the German Democratic Republic, Bulgaria, Hungary, Mongolia, Poland, Romania, Czechoslovakia, and the USSR. Mongolia entered the CMEA in 1962; the LDCs that joined the CMEA later, such as Cuba and Vietnam, continue to be part of the Group of 77, but they sometimes associate themselves with joint statements made in the name of the East European socialist countries. The full appellation used for the East European CMEA countries that compose Group D at UNCTAD is “the socialist countries of Eastern Europe”; here, “CMEA countries” and “East European countries” are used synonymously with this term. Romania, which calls itself a “developing socialist country,” no longer participates in Group D; since the UNCTAD sessions in Nairobi (1976), it has officially been a member of the Group of 77. The Group of 77 includes the LDCs, of which there are more than one hundred; Group B is composed of the industrialized countries that maintain a market economy.

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I use Soviet sources here to establish the position of Group D because the member-states of Group D invariably present uniform positions, and the USSR has a preponderant voice in the Group. For a summary of some differences in nuance among the approaches of the CMEA countries to issues involving the Third World, see Despiney, Barbara, “Pays socialistes et nouvel ordre économique international,” in Lavigne, Marie, ed., Stratégies des pays socialistes dans l'échange international (Paris: Economica, 1980), pp. 104–10.Google Scholar

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26. For an excellent analysis that focuses more on political than on economic aspects, see Korbonski, Andrzej, “Detente, East-West Trade, and the Future of Economic Integration in Eastern Europe,” World Politics 28, 4 (07 1976), pp. 568–89.CrossRefGoogle Scholar

27. A careful and systematic analysis of these developments may be found in Matejka, Harriet, Trade Control in Eastern Europe (Geneva: Éditions Médécine et Hygiène, 1978), chap. 5.Google Scholar

28. See UNCTAD, “Report of the Special Committee on Preferences,” TD/B/329/Add.3 (9 October 1970).Google Scholar

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32. UNCTAD, “Joint Declaration by Socialist Countries,” 28 May 1976, p. 15.Google Scholar

33. U.N. General Assembly, “Report on the Most-Favored-Nation Clause, by Mr. Nikolai Ushakov, Special Rapporteur,” A/CN.4/309 and ADD.1 and 2 (11 and 12 April and 10 May 1978), in Yearbook of the International Law Commission, 1978, 2, 1, pp. 26–28.Google Scholar

34. Ibid., p. 9.

35. For a broad study of shipping, see Juda, Lawrence, “World Shipping, UNCTAD, and the New International Economic Order,” International Organization 35, 4 (Autumn 1981), pp. 493–516.CrossRefGoogle Scholar

36. In this connection, see Minakov, A. I., “O deistvitel'nosti arbitrazhnykh soglashenii” [On the Validity of Arbitration Agreements], Vestnik Moskovskogo universiteta, ser. 12, Pravo 29, 5 (09–10 1974), pp. 69–76, esp. pp. 74–76.Google Scholar

37. Vel'iaminov, , Pravovoe uregulirovanie, pp. 109–44.Google Scholar

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39. Vel'iaminov, , Pravovoe uregulirovanie, p. 145.Google Scholar

40. Ibid., p. 134.

41. Schiering, Wulf-Peter, “Liner Code und EG-Schiffahrtspolitik,” Aussenpolitik 30, 2 (1979), pp. 188–90Google Scholar. I thank Samuel Evans for helping me to understand this particularly difficult article.

42. Krasnov, G. A., Torgovlia uslugami ili ekspluatatsiia? [Trade in Services or Exploitation?] (Moscow: “Mezhdunarodnye otnosheniia,” 1971), pp. 7–96Google Scholar; Krasnov, G. and Chekhutov, A., Developing Countries: Problems of Foreign Economic Relations (Moscow: Novosti, 1973), chap. 5.Google Scholar

43. Hall, William, “UNCTAD's Plan to Transform World Shipping,” Financial Times (London), 18 01 1980, p. 18.Google Scholar

44. Maire, Jean-Paul, “Problèmes de qualification juridique et de détermination du droit applicable aux accords de coopération économique et industrielle,” Annales d'éudes internationales 5 (1974), p. 95.Google Scholar See also Dessemontet, François, “Transfer of Technology under UNCTAD and EEC Codifications: A European View on Choice of Law in Licensing,” Journal of International Law and Economics 12, 1 (1977), pp. 29–35.Google Scholar

45. To observe this evolution, it is instructive to compare two summaries of the state of the negotiations drawn up three years apart: Touscoz, Jean, “Le code international de conduite pour le transfert des techniques,” in Judet, P. et al. , eds., Transfert de technologie et développement (Paris: Librairies techniques, 1977), pp. 197–225Google Scholar; and Roffe, P., “UNCTAD: Code of Conduct for the Transfer of Technology—Progress and Issues under Negotiation,” Journal of World Trade Law 14, 2 (03–04 1980), pp. 160–72.Google Scholar

46. Romer, J.-Christophe and DeSolère, Michel, “Accords conclus par les pays socialistes européens avec les pays en voie de développement,”Google Scholar in Judet, , Transfert de technologie et développement, pp. 341–79.Google Scholar

47. Lall, Sanjaya, “The Patent System and the Transfer of Technology to Less-Developed Countries,” Journal of World Trade Law 10, 1 (01–02 1976), pp. 1–16.Google Scholar

48. UNCTAD, “Major Issues Arising from the Transfer of Technology: A Case Study of Sri Lanka,” TD/B/C.6/6 (7 October 1975)Google Scholar, discusses the problems that can result from the transfer of technology from a socialist country to a developing country.

49. [Kleer], Jerzy Klerr and Zacher, Lech, “Technology Transfer from CMEA Countries to the Third World,” in Laszlo, Ervin and Kurtzman, Joel, eds., Eastern Europe and the New International Economic Order: Representative Samples of Socialist Perspectives (Elmsford, N.Y.: Pergamon, 1980), p. 26.Google Scholar

50. The relations between multilateralization and convertibility are summarized in Matejka, Harriet, “Convertibility in East Europe,” Annales d'études Internationales 5 (1974), pp. 179–85Google Scholar. An intriguing Hungarian opinion is presented by Botos, Katalin, “On the Further Development of the Currency and Financial System of the CMEA,” Soviet Studies 34, 2 (04 1982), pp. 228–53.CrossRefGoogle Scholar

51. For a balance-sheet of LDC demands addressed to the Group D countries in 1976 and replies see Despiney, , “Pays socialistes,” pp. 116–17.Google Scholar

52. For a review of this program, see UNCTAD, “Tripartite Industrial Cooperation and Cooperation in Third Countries,” TD/243/Supp.5 (20 April 1979)Google Scholar. Some interesting, more general meditations on the subject may be found in Zurawicki, Leon, Multinational Enterprises in the West and East (Alphen aan den Rijn: Sijthoff & Noordhoff, 1979), chap. 6.Google Scholar

53. Relevant citations may be found in Dessemontet, , “Transfer of Technology,” p. 2, n. 6.Google Scholar

54. See also Fink, Karl Hermann, “L'arbitrage socialiste dans le commerce Est-Ouest,” Droit et pratique du commerce international 1, 3 (09 1975), pp. 367–81Google Scholar; Jerzy Rajski, “Basic Principles of International Trade Law of Certain European Socialist States and of East-West Trade Relations,” Ibid., 4, 1 (April 1978), pp. 9–28.

55. Morozov, G. [I.], “Mezhdunarodnoe pravo i mezhdunarodnye otnosheniia” [International Law and International Relations], Mirovaia ekonomika i mezhdunarodnye otnosheniia, 06 1975, pp. 46–51, at pp. 50–51Google Scholar; Morozov, , “O prave mezhdunarodnykh organizatsii” [Concerning the Law of International Organizations], Sovetskoe gosudarstvo i pravo, 05 1972, pp. 56, 60–64Google Scholar; Morozov, , Mezhdunarodnye organizatsii: nekotorye voprosy teorii [International Organizations: Some Problems of Theory], 2d ed. (Moscow: “Mysl',” 1974), pp. 276–87.Google Scholar

56. These diverse conceptions hinder the extension of commercial relations beween the EEC and the CMEA. The question, political as well as legal, of the CMEA's competence to negotiate trade agreements in the name of its members, or to oversee their foreign trade, is fundamental. Articles on this question by experts from the CMEA countries, from the point of view of institutions and law, include: Fiumel, Henryk De, “The Council for Mutual Economic Assistance in International Relations,” Studies on International Relations 7 (1976), pp. 68–77Google Scholar; Rajski, Jerzy, “Rozwój miedzynarodwych stosunków umownych RWPG z państwami trzecimi” [The Development of the CMEA's International Contractual Relations with Third Countries], Państwo i pravo 31, 7 (07 1976), pp. 40–51Google Scholar; and Sárközy, Tamas, “A KGST-országok nemzetközi gazdálkodó szervezetei intézményi rendszeréról” [On the Institutional System of International Trading Organizations in CMEA Member-Countries], Gazdaság 11, 3 (09 1977), pp. 93–106Google Scholar. Western-language summaries accompany the last two articles.

A good Western review that includes these factors in the context of the current political and economic situation is Baumer, Max and Jacobsen, Hanns-Dieter, “EC and COMECON: Intricate Negotiations between the Two Integration Systems in Europe,” in Feld, Werner J., ed., Western Europe's Global Reach: Regional Cooperation and Worldwide Aspirations (Elmsford, N.Y.: Pergamon, 1980), pp. 110–24.Google Scholar

57. UNCTAD, Resolutions and Decisions, TD/B/71 (08 1966).Google Scholar

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60. One example is the influence of the CMEA General Conditions of Delivery of Goods (1968) on the UNCTAD negotiations concerning multimodal transport.

61. The growing importance of forums such as UNCTAD in the eyes of the socialist countries of Eastern Europe is highlighted by an editorial of the Soviet journal authoritative in legal matters. It recommended the “deeper study, from the point of view of [international] law, of the problems and questions” raised by multilateral diplomacy, particularly “the method of 'consensus,' which is relatively new but ever more widely adopted.” “Mir i sotrudnichestvo— trebovanie epokhi” [The Age Demands Peace and Cooperation], Sovetskoe gosudarstvo i pravo, September 1973, p. 7. This method was so new and strange that the word “consensus” in the original text was enclosed within quotation marks and followed in parentheses, by way of explanation, by the Russian word for “agreement” (soglasovanie).

62. Kostecki, M. M. notes that “surprising little has been written by economists and other researchers on state trading in … the developing countries.”Google Scholar See his “State Trading in Industrialized and Developing Countries,” Journal of World Trade Law 12, 3 (May–June 1978), pp. 187–207; quotation at p. 207.Google Scholar

63. Krasner, , “Structural Causes,” pp. 194–204.Google Scholar