| Abstract |
From the 1970s onwards, the world economy underwent deep structural transformations in the context of the emerging neoliberal economic concept, which led to the irregular geographical expansion of the Western economic model. During this period, an increasing interconnection was created between large companies and financial markets, composing in this way more open and fluid trading systems. Thus, the companies of the capitalist nucleus began to expand in geographical areas that allowed them to maintain and expand their profits. As result, Eastern Europe and Romania's centrally planned economies became over time integrated into the western capitalist relations. It is important to reconsider this integration of the socialist economies of Eastern Europe as a part of the global trade, as well as, of productive relations. In addition, the trade relations that were established with the Western World inevitably led to the creation of a financially dependent relationship of the Eastern Bloc in relation to the Western World. The penetration of the American and European capital markets into Eastern Europe, in the midst of a global economic contraction, in the 1970s, was an important, though hitherto to a large extent ignored, component of the Cold War, a fact which, in the writer’s opinion, requires a more in-depth investigation.
At that time in the West, in the context of economic liberalization and under the pressure of the fluctuations of the world economy, there was a process of expansion of the capitalist market to economic and political systems that at least in theory, rejected the capitalist economic relations of the Western World, that is, to the centrally planned socialist economies of Eastern Europe. At a first level, this penetration took place in the form of financial relations, providing to these countries access to Western capital and at a second level, there was an expansion of economic and technological transactions. From the late 1970s onwards, the role of IMF-type supranational organizations had been enhanced, providing in this way a safeguard for the expansionary policies of Western private banks.
The topic of the paper is socialist Romania's relationship with the capital markets of the Western world and the role of the IMF in dealing with the Romanian debt crisis of the 1980s. How did a socialist country gain access to the western financial markets, and how it eventually contributed to its collapse? The last decade of so-called socialism in Romania has been remembered by most people as a period of utter deprivation and impoverishment, leading to shortages of basic products such as food. The economic and social pressures that Romania received in the last years of Ceausescu's regime from Western creditors have hardly been investigated. But what led the regime to choose political austerity, in order to deal with the debt crisis? Why the Romanian government decided to fully repay the debt, regardless of the social consequences? Relying on the IMF archives, I will attempt to understand the role of the IMF in shaping the Romanian economic policy of the 1980s. What was the domestic economic strategy and that of the IMF regarding the external debt of Romania? What were the policies proposed and imposed by the IMF to deal with the debt crisis?
We will show how Romania, a member of the Soviet coalition and the Warsaw Pact, came to pursue a more independent foreign policy in shaping its economic development. The rupture with Moscow paved the way for wider economic and political relations with the developed economies of the West, so I will look at this tightening of economic relations between Romania and the West, which has resulted in the flow of Western capital into the Romanian socialist economy. We will also see that the Romanian state in the late 1970s was unable to service its external debt, to the point of seeking financial assistance from the IMF in order to break the financial impasse. Finally, the analysis of the structural program imposed by the supranational organization in Romania in the 1980s will help us to better understand the real aspirations of the strongest economies of the capitalist core against those of existing socialism.
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Το ΔΝΤ στην Ανατολική Ευρώπη πριν το 1989 : η περίπτωση της Ρουμανίας, 1972-1989
