International Bank L 1for Reconstruction and Developme VOL. 8
V.(1O
Preliminary Paper No. 8
for the
Wlorking Party on the Polish Loan Application
FILE COPY
Foreign Trade in Poland
Issued by:Eastern European DivisionLoan Department June 1, 1947
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Acknowledgment
The study which follows was prepared
by the Division of Operational Analysis, UNRRA
Mission, W,arsaw, in collaboration with various
agencies of the Polish Government. The report,
based upon a paper on the same subject origin-
ally issued by the European Regional Office of
TUNRRA in London, is presented here because it
is believed to give the most complete account
of recent developments in the foreign triade of
Poland currently available.
CONTENTSPag,e
I. INTRODUCTION . . . . . . . . . . . . . . . . . . . 1
Results of Occupation and War Devastation . . 2Effects of Territorial Changes . . . . . . . 6The Changed Commercial Organization . . . . 7UNRRA's Part. . . . . . . . . . ... . . . . . 12
II, TRADE DEVELOPMENTS, 1919 to 1939 . . . . . . . . . 13
Difficulties in Building Poland'sForeign Trade . . . . . . . . . . . . . . . 13
Direction of Polish Foreign Trade. . . . 17Composition of Polish Foreign Trade. . . 20
III. POSTWAR CHANGES... . . . 23
Prospective Changes in Exports. 25Losses: Timber . . . . . . . . . . . . . 25
Food . . . . . . . . . . . . . . 26Potassium. . . . . . . . . . . . 28
~~~~~~ ~~~~~Oil . . . . . . . . . . . . . . . 29Gains: Coal . .29
Iron andaSteel . .30Non-Ferrous Metals . . . . . . . 31Other Gains. . . . . . . . . . . 31
Changes in Import Requirements. . . . . . . . 33Industrial and Transport Equipment . . . 34Petrol and Oil . . . . . . . . . . . . 35Raw Materials. . . . . . . . . . . . . . 35Fertilizers. . . . . . . . . . . . . . . 36
Future Outlook. . . . . . . . . . . . . . . . 37Changes in the Direction of Poland's
Foreign Trade . . . . . . . . 38Germany .. 38U.S.S.R . . 39United States. . . . . . . . . . 41United Kingdom . . . . . . . 42Other Countries . . . . . . . 43
IV. FOREIGN TRADE SINCE LIBERATION .43Commercial Agreements . . . . . . . . . . . . 45Prices and Values . . . . . . . . . . . . . . 49Trade in 1945 and 1946. . . . . . . . . . . . 51Foreign Trade and UNRRA Imports . . . . . . . 60Summing up. . . . . . . . . . . . . . . . . . 65
V. POLAND'S TRADE PROSPECTS FOR 1947 TO 1949. . . . 66
Foreign Trade 1946 to 1949. . . . . . . . . . 67Imports and Exports in 1947 . . . . . . . . . 69Balance of Payments in 1947 . . . . . . . . . 761948 and 1949 . . . . . . .. . . . .. . . . 83
APPENDIX - Trade Agreements Concluded by Polandto 31st December, 1946 . . .... . 86
I. INTRODUCTION
No other country in Europe suffered upheavals so great or so
widespread as did Poland during the war. Not only was the coun-
try devastated on an unparalleled scale, its population killed
off and scattered throughout Europe, but, following the war,
great changes have been made in its boundaries which will funda-
mentally affect the nature of the economy.
It is important, when considering foreign trade in Poland,
to distinguish between the effects of war devastation and the
effects of territorial changes. The effects of war devastation
are temporary. They have created an emergency need for imports
on a tremendous scale of a completely different character from
the imports required in the long run; thus, the needs of food in
1945, 1946 and 1947 are great, 'ut quite temporary. Similarly,
the needs for investment imports to rebuild industry, transport,
and agriculture are on a scale which cannot be sustained. At the
same time war devastation has seriously curtailed Poland's
ability to export so that she needs, for several years, a large
excess Qf imports over exports.
lWhile these considerations will affect Poland's foreign
trade in the next three years, it is the territorial and popu-
lation changes which will leave a permanent stamp on Poland's
foreign trade. In the first place, although the territorial
changes have left agricultural potential almost unchanged, they
have more than doubled Poland's industrial potential. It is
clear, therefore, that in the long run Poland's imports and ex-
ports will be on a scale very much higher than before the war.
- 2 -
Furthermore, these changes will create a new pattern of inter-
national trade. Poland now has large quantities of coal avail-
able for export. At the same time she has lost over three-
quarters of her crude oil production and must now import oil on a
considerable scale. Her timber resources are so reduced that it
will be many years before timber, which was so important in her
pre-war trade, can figure in her exports again. The addition of
the industrial areas has in some cases reduced the needs for raw
materials but in most cases, owing to the fact that, before the
war, these areas imported large quantities of raw materials,
there is now a greatly increased demand for raw materials, such
as iron ore, scrap iron and textiles. Furthermore, owing to the
increased industrial potential, it is certain that much greater
requirements of capital equipment of all kinds will in the long
run be required by Poland. When agricultural and industrial
production reach their full strength the national income per
capita will be twice that before the war; this will lead to fur-
ther changes in the pattern of Poland's imports. Needless to
* say, the reduction in population will ultimately leave mucb
larger quantities of food available for export and her expanded
industry will enable her to export her products on a much greater
scale than before the war.
Results of Occupation and War Devastation2
Poland was occupied by Germany in September, 1139; the
westernmost parts of the country were not liberated until the
spring of 1945. For five and a half years, therefore, "oland
was subjected to ruthless exploitation by an enemy whose p<l--y
of extermination of the Polish people was limited only by the
necessity of making the fullest possible use of the country's
3-
resources and labor for the benefit of his war effort. A large
proportion of the country's industrial machinery and equipment
was removed into Germany, and other installations, especially
those not immediately needed for war purposes, were allowed to
fall into a state of utter disrepair. Several million men and
women were removed into Germany for forced labor.
In agriculture a large proportion of the existing livestock
was slaughtered. At the end of the war Poland had less than
one-third of her prewar total of cattle and about one-fifth of
her pigs and sheep. Horses, which played such an important part
in the country's farm economy were reduced to about one-third.
Fat, meat and milk production were reduced to less than one-
quarter of the prewar total. During the war, one in every six
of Polandis farms was put out of action or entirely destroyed.
Available farm animals, fertilizers, machinery and seed are all
less than are required by Poland to feed herself. The ex-German
territories which formally produced food surpluses are now a
food deficit area - in fact, many of the former German farms are
still derelict because of the war.
In 1946 Poland's production of wheat wuas 31 percent of the
prewvar total, and the important rye crop only 42 percent of pre-
war production. Potatoes, which are the most important root-crop,
were reduced to one-half. Formerly Poland exported food - before
the wrTar 44 percent of her exports were farm and forest products.
In 1946, without UNFRA's assistance, the Polish people would
have s tarvedL.
Industrial problems wnrere likewise catastrophically affected
by the war. In spite of the acquisition of the recovered terri-
tories, which before the war had an industry equal in size to
- 4 -
that of all Poland, industrial production in 1946 vwas only 67
percent of prewar.
Tf to this is added the fact that during the war over six
million Poles lost their lives, it will be clear that several
years and substantial internal economic reorganization will The
required before Poland can reach her prewar level of exports.
During the war the country itself was divided in two, the
western part having been incorporated into Germany and the rest
organized as the so-called "General Government". This, of
necessity, distorted the wrhole economy of Poland. While the
western part was within the German customs area it was separated
from the "General Government" by a tariff barrier which ran
across the heart of Poland. During these years both areas were,
of course, entirely cut off from most of their prewar markets,
and had only a very limited trade with some of the other countries
of German occupied Europe.
The battles fought during the German invasion in 1939 and
the period of Soviet liberation, from 1944 to the end of hostili-
ties in 1945, resulted in widespread destruction of buildings and
industrial equipment. Warsaw was almost entirely destroyed and
the industrial capacity of such towns as Poznan, Rzeszow, Radom,
Bydgoszcz and WA!roclaw was very substantially reduced. The ports
of Gdansk (Danzig) and Gdynia were made unusable and the country's
system of internal communications was almost vwholly ruined. 1/
1/ For details of the damage done to Polish transport, industry,and agriculture respectively, see: Operational Analysis PapersNo. Transport Rehabilitation in Poland, No. Industrial Re-habilitation in Poland, and No. Agriculture and Food -inPoland, UNRRA European Regional Office, London.
-5-
Poland's war losses are summarized in the following tabhle.
This table shows only material losses in the old territories
within the present boundaries of Poland, and leaves out of acc-
ount completely the heavy destruction in the recovered territories
which must have been about the same magnitude.
TABLE I
Poland's War Losses (Old Territories)(in million dollars at 1946 prices)
Agriculture 1,640Forestry 1,120Industry 5,560Transport & Communications. 3,470Public Administration 940Schools and Hospitals 750Houses and Personal Property 2,96o
Culture and Art 1J 80
Total 18,220
Source: Council of Ministers, 'Warsaw, 1947.
In the old territories alone, Poland suffered war losses of
18.2 million U.S. dollars in the form of Ihuildings, plant and
0 equipment, and raw materials. This omits altogether losses in
the form of the labor of the Polish population during the war,
which was entirely at the disposal of Germany, and the tremendous
losses of the Polish population in the form of death, disablement,
and the legacy of serious illness in Poland today.
It is clear that the effects of occupation and war devastat-
ion on such a scale make Poland's immediate postwar foreign
trade completely different from her prewar trade, and her ultim-
ate commerce with other nations. The needs for relief and for
the initial rehabilitation of industry have assumed paramount
importance in her import program, while the limitations on indus-
trial recovery imposed by the great devastation have seriously
-6-
curtailed her exports.
Effects of Territorial Changes
As a result of the Yalta, Moscow and Potsdam agreemenQs
impoortant revision were made in Poland's frontiers. About 181
thousand square kilometers of predominently agricultural land in
the east were transferred to the U.S.S.R. while 104 thousand
square kilometers of territory, including the valuable industrial
area, of ex-German Silesia, together with a section of the Baltic
coast and of East Prussia, vwere acquired from Germany. As a
result, the area of Poland was reduced by 20 percent, to 312,700
square kilometers. These changes in territory and wartime up-
heavals between 1939 and 1946 reduced the country's population
by over 30 percent and its population per square mile by 16 per-
cent; today the population of Poland is about 24 million.
The territory acquired in the West was, before the war, more
productive agriculturally than that transferred to the U.S.SR
It is also true that the acquisition of the rich industrial area
of ex-German Silesia and of the port of Stettin have more than
doubled Poland's industrial potential. Since, however, the
territories involved were ruthlessly scorched by the Germans,
Poland's immediate industrial rehabilitation problem has been
greatly increased.
Table II, comparing industrial output in 1937 in the terri-
tories of prewar Poland, gives a clear picture of the changes in
industrial resources as a result of frontier revision.
As the table shows, Poland has now only 23 percent of her
former oil caDacity and none of her former resources of potassium
salts5 but has gained, in comparison with prewar, some very
importgnt coal mines, which, at their prewar capacity, would
-7-
increase her coal production by as much as 80 percent at the end
of the four year plan actual production will be more than twice
the prewar level. Moreover, the country acquired increased de-
posits of iron ore, lead and zinc, and materials such as cadmium,
cobalt, gypsum, gneiss and knolin for wmhich she was formerly
entirely dependent on imports. Her steel producing capacity has
expanded by 48 percent.
Other changes in Poland's postwrar economy and their bearing
on the country's foreign trade prospects will be discussed in
* detail in the following sections of this Paper.
TABLE II
Poland's Industrial Production after Frontier Revision
(Production in 1937 in thousands of metric tons)
Prewrar Postwar Percent Increase(+)Poland Poland or Decrease ()
Pit Coal 36,200 65,650 + 78.6
Coke 2,124 5,353 +152,0
Lignite 18 7,611 Increased 412 timez
Zinc and Lead 492 1,214 +146.8
Iron Ore 792 865 + 7.9
Steel 1,;441 2,141 4 48.o
Crude Oil 501 141 71.9
Potassium Salts 522 0 -100.0
Source: Data supplied by the Polish Government except forthe production of pit coal, figures for which arebased on Statistical Year Book for Poland, London,1941. Figures for ex-German territories are fromGermany Basic Handbook, Section F. The MineralIndustries, Foreign Office and Ministry ofEconomic WP.arfare, London, 1941.
The Changed Commercial Organization
It is necessary, in order to understand Poland's postwar
foreign trade, to describe briefly the postwar economy.
Essentially the Polf.sh economy is a combination of nationalized
industry and private enterprise. At present about 80 percent of
the country's working population wrork in private enterprise,
while about 20 percent work in nationalized industry or central
and local government administration. In the nationalized sector,
which covers all the heavy industries and heavy engineering in-
dustries, a rigidly controlled structure of prices and wages is
at present in existence. These prices and wages are fixed on the
basis of strict economic costs, and an effort is made to ensure
that wage rates bear correct relations one to another, and that
all prices of commodities are true economic prices, including
the correct allowances for costs of labor and raw materials,
depreciation of capital, and management expenses. The free
enterprise sector of the economy, however, is free from all con-
trol, except that imported raw materials and raw materials in
short supply must be obtained through central government agencies.
Within this sector prices are many times higher than in the con-
trolled sector. For instance, while a ton of coal is sold by the
coal industry at 590 zlotys, a single meal in a free market res-
taurant costs about the same price and a pair of shoes in the
free market costs 15 thousand zlotys.
It is because of this dual price system that the Government
had to fix an official rate of exchange of one hundred zlotys to
the dollar, which, in fact, rules out normal international trade
through the free market. It is also the reason that Poland has
had to conclude commercial agreements with the rest of the world
on the basis of self-balancing barter agreements involving no
movements of foreign exchange. The trade which is carried on
outside trade agreements is either bi-lateral barter operations
- 9 -
by individuals or companies, which occurs when the prices in
Poland and in the other countries are such as to make the trade
profitable, or, in some cases, exports and imports arranged for
free exchange at the official rate. Every operation carried on
outside the trade agreements must, of course, be covered by im-
port and export licenses.
It is obvious that the zloty cannot be stabilized in the
near future; stabilization awaits the equalization of controlled
and free market prices and the end of price fluctuations in the
outside world. WNhile two price levels exist within the country
the zloty cannot be assigned a fixed value which will enable
foreign comimerce to be carried on on a free trade basis.
Furthermore, large price fluctuations in the outside world., and
the inflationary pressures on world prices, combined with the
stabilization of prices in Poland, has made any realistic rate of
exchange for the zloty impossible for the moment. The problem
of stabilization of currencies is, of course, world-wide and one
which should be solved by the International Monetary Fund.
Poland is a member of this organization and, when cQnditions are
judged favorable, will co-operate with other nations, through the
Fund, in stabilizing the zloty.
As a result of the nationalization of her major industries,
and, to some extent, of her distribution system, the foreign
trade of the country is now largely controlled by state depart-
ments, co-operatives or state sponsored companies. The main
Government Department concerned is the Ministry of Navigation
and Foreign Trade, which is in charge of trade negotiations with
foreign countires.
As in most countries during and after the war, in Poland
- lo -
imports and exports are controlled by Government permits. Al-
though prewar tariff legislation is still in force, it is not
applicable to conditions existing today, and it has been sus-
pended except for small additional costs or duties which are
levied on goods produced under a State monopoly such as tobacco
and matches. The Government intends to give up the policy of
tariff protection. Although the system of fixing the prices of
commodities entering into foreign trade may appear to be a sub-
stitute for tariff, in fact, dince the prices are made to conform
to the controlled price structure, this is a temporary measure
due to the necessity of adapting prices of the commodities to
the Polish orice level. In fact, all the effects of tariffs and
export duties in obtaining favorable terms of trade can be ach-
ieved in the terms of the barter agreements themselves and further
price adjustments are irrelevant.
For the foreign trade transactions of enterprises which
belong to the nationalized sector of Polish industry, special
central trade bureaus were established, one for each major
branch of industry. These bureaus are limited companies, the
shares of Which are owmed by the respective federations of fac-
tories, These bureaus also act on behalf of co-operatives and
private firms in negotiations with foreign traders. However, it
should be noted that they have no monopoly of foreign commerce.
Private and public enterprise, which even have their own foreign
trade agencies, may deal direct with foreign traders,simply by
obtaining the necessary export or import licenses granted by the
Ministry of Navigation and Foreign Trade. The procedure for ob-
taining export and import licenses i$ the same, whether the app-
licant is a central bureau or a private enterprise. The central
- 11 -
bureau or a private enterprise. The central bureaus are organ-
ized into branches, each bureau dealing with a different comm-
odity. The co-operatives "Spolem" and "Zwiazek Samopomocy
ChXopskiej" deal chiefly with imports and exports of agricultural
produce. No restrictions are imposed on private commercial
enterprise regarding the commodities dealt in.
The Spolem co-operative imports foodstuffs into Poland for
planned, countryside state distribution and also for distribution
through the open market. This co-operative, which has the right
to exDort directly certain agricultural products,V2 does not,
however, handle food supplied by UNRRA. The Co-operative
"Zwiazek Samoponocy Chlopskiej" and the commercial enterprise
"Dal" also import foodstuffs.
Private merchants tend to deal with commodities manufactured
or used by small and medium sized private undertakings. Subject
to Government licensing, private barter transactions are en-
couraged, besides exercising a general control over the type of
goods exported and imported, the Government is, of course, also
concerned with prices and the mechanism for effecting the
exchange.
1/ The term "foodstuffs" includes groceries, rice, grain, flour,root-crops, edible fats, dairy products, seeds and vegetables-fresh and tinned, but Spo%em does not include in its scopelivestock, bacon, ham and meat preserves. This co-operativeagency has the exclusive right to import agricultural anddairy machines, parts thereof, and fertilizers.
2/ These include dried ahdfresh berries, mushrooms, medicinalherbs, vegetables, seeds, bristles, horse-hair, tinned vege-tables, dairy produce, eggs, poultry, feathers and down,and agricultural machinery.
- 12 -
UNRRA's Part
W7hen UNRRA commenced operations, the requirements of Poland
were calculated for a country of undefined area and with a
num'oer of inhabitants not yet precisely known. It was not until
the Potsdam conference that the scope of the changes in territory
and economic resources were even approximately known. However,
it wqas clear that Poland was in great need, not only of food but
of clothing and medical supplies, and of commodities required for
the rehabilitation of her agriculture, industry and transport.
It was also clear that Poland did not possess sufficient gold
and foreign exchange to pay for these.
In September 1945, Poland, therefore, concluded a basic
agreement with UNRRA whereby full scale relief and rehabilitation
assistance was to be given her; UNRRA's total assistance to
Poland is valued at 481.3 million U.S. dollars. The expenditure
of this sum is shown in the following table:-
TABLE III
Proposed Program of UNRRA Assistance to Poland0 (in millions of U.S. Dollars)
Categories of Aid Value
Food, Feed and Soap 201.52Clothing, Textiles and Footwear 82.7Medical and Sanitary Supplies 25, 8Industrial Rehabilitation Supplies 95.34Agricultural Rehabilitation Supplies 75.9
TOTAL 481.26
Source: UNXRA Bureau of Supply, WNashington
By the end of 1946, TURRA had supplied Poland with goods for
a total of 398 million dollars. These UNRRA commodities repre-
sented about 65 percent of Poland's total imports since the
end of the war which totalled 609 million dollars. Although
after the end of the war the Polish Government has concluded
- 13 -
compensation agreements with various countries, valued at 447,
million dollars, up to the end of 1946, imports under these
agreements were valued at only 173 million dollars. Whereas
deliveries under most of these compensation agreements are still
to come, only some 83 million dollars of the UNRRA program re-
mains for delivery in 1947. It is evident that Poland will he
in a very precarious position in 1947 unless other sources of
essential imports are found. The aid given by UNRRA has not been
sufficient to rehabilitate, or even to feed Poland adequately;
without external aid of some kind in 1947 and a rapid revival of
her foreign trade Poland will again be close to starvation and
the progress of her economic life generally will be seriously
impeded. It is therefore important to examine Poland's postwar
trade prospects in some detail: an attempt to do this is made in
the following pages.
II. TRADE DEVELOPMENTS, 1919 to 1939
Difficulties in Building Poland's Foreign Trade
0 Before 1914 Poland did not exist as an independent country.
It was partitioned between Austria, Germany and Czarist Russia,
and the area concerned was regarded as a kind of economic hinter-
land by these three powers. Of necessity, wNhen she gained inde-
pendence, the economy had to be integrated and completely new
foreign trade patterns built up. Such economic adjuastments wTere,
of course, difficult and developed slowly. Poland had only .ust
succeeded in overcorniL.g this initial handicap and building up a
successful system of foreign trade when Germanyr rvt&v n in
1939.
The years from 1919 to 1924 were too unsettled to permit of
anything approaching normal foreign trade - or even collection of
- 14 -
complete foreign trade statistics. To the handicap of the long,
pre-1914 partition, there was added the further handicap of a
five years' delay in economic reconstruction. Another factor of
importance was the lack of facilities for sea transport; although
Gdansk existed, Polish traffic was discriminated against and,
pending the construction of the port of Gdynia, a major seaport
belonging to Poland herself, port capacity was inadequate. After
1924 , energies which otherwise could have gone into the re-
establishment of foreign trade for the benefit of Poland's
standard of living and the development of her industries, were
diverted into the building of a Polish port and the re-adjustment
of transport facilities from the interior to the coast.
It was not until 1924 that modern Poland emerged as a cornm-
ercial nation. Even then, trade was conducted mainly with thc
Continent of Europe and particularly with her immediate neighbors
to the West, Germany, Austria and Czechoslovakia. As late as
1928, only 2,7 percent of all Polish exports went to overseas
cotmtries outside Europe. The main reasons for this were the
burden of adjustment to the economic unification of the country,
transport problems, and the bulkiness of Polish exports.
Poland depended on Germany for a considerable section of
its agricultural exports and industrial imports. Germany tried
to exploit this dependence by tariff discrimination against
Poland, which resulted in a tariff war, lasting from 1924 to
1933. In the course of this economic struggle, Poland changed
the direction of her foreign trade from Germany to the countries
of nothern Europe and to those across the seas. The share of
Germany and Austria in Poland's foreign trade fell from about 50
- 15 -
percent in 1924 to only 20 percent in 1932. These adjustments
could only be achieved by radical changes in the composition of
Polish exports and imports, which of course, protracted the per-
iod of economic adjustment to postwar conditions.
0
0
- 16 -
TABLE IV
Poland's Foreign Trade 1922-1938(in million zlotys)
Year Imports Exports Balance
1922 1,454 1,127 - 3271923 1,920 2,056 + 1361924 2,542 2,177 - 3651925 2,755 2,188 - 5671926 1,539 2,246 + 7071927 2;892 2,515 - 3771928 3,362 2,508 8541929 3,111 2,813 - 2981930 2,246 2,433 + 1871931 1,468 1,879 + 41932 862 1,84 9+ 2221933 827 960 -e 1331934 799 975 + 1761935 861 925 + 641936 1,003 1,026 ± 231937 1 254 1,195 - 591938 1,300 1,185 - 115
NOTE: All figures are computed in gold Zlotys -5924.44 zlotys per kg. of pure gold.
Source: Concise Statistical Year-Book of Poland
The world depression of the early thirties affected the
Polish economy with particular severity because of the country's
rigid and orthodox domestic economic policy. The Polish zloty-/
did not follow the pound sterling and the U.$. dollar, and was
not devalued during the 1931 - 1933 period. As a result of this
reluctance to assist the revival of exports by currency devalua-
tion, .Polish exports and foreign trade generally suffered more
than that of other countries during the world depression and de-
clined in value by over two-thirds between 1929 and 1933.After19335
there was a slight revival, but trade figures failed to recover
even to one-half of 1929 values. In the years of depression the
1/ In 1937 the value of the Polish zloty was about 19 U.S. centsand about 9d. sterling.
- 17 -
country's export surplus was never really large enough to permit
of even a full service on the Polish external debt.
Table IV shows the history of Poland's imports and exports
from 1922 to 1938. Until 1930, as might be expected, imports ex-
ceeded exports by some 240 million zlotys per annum; during the
depression exports exceeded imports and it was not until 1937 that
Poland again imported in excess of her exports. It is ilnteresting
to note that the balance of trade depended mainly upon capital
movements. During years of world prosperity Poland was a field
for foreign investment by other countries and imported capital on
a large scale; during depression year, on the other hand, Poland
herself had to export capital. The excess of exports over imports
was then necessary to meet financial commitments abroad. The
following table shows three items in the balance of payments from
1927 to 1937; interest movements, gold movements and capital
movements.
TABLE IVa
Interest,, Gold and Capital Movements 1227 to 1937
Year Interest Gold Capital
1927 - 230 -282 5051928 - 284 -107 +1, lo91929 - 379 - 81 T 5931930 - 450 + 141 - 4161931 - 417 - 61 - 41932 - 285 - 13 - 32
1935 - 145 + 22 - 1081936 - 172 + 18 - 1471937 - 177 124 - 39
E= xcess of inward movement over outward movement.
Source: Ministry of Navigation and Foreign Trade, Warsaw.
Direction of Polish Foreign Trade
The following table shows the most important countries to
which Poland's exports went in 1937 and 1938. Later export figures
- 18 -
cannot be regarded as representative owing to Germany's annex-
ation of Austria and parts of Czechoslovakia in 1938.
TABLE V
Poland's Exports in 1937 and 1938 to its Leading Markets
Percent ofMillion Zloty Total Polish
Country (annual average) Exports
Germany and Austria 259 21.7United Kingdom 218 18.2United States 82 6.9Sweden 73 6.2Belgium 63 5.3Italy 60 5.0Holland 58 4.80w Czechoslovakia 48 4,0Norway 21 1.8
TOTAL 882 73.9
Source: Concise Statistical Year-Book of Poland.
The table shows that, in 1937 and 1938, the United Kingdom
was equal with Germany (including Austria) as the most important
ofPoland's markets. The importance of Austria may be judged
from the fact that, in 1937, it received 4.9 percent of Poland's
exports. The large exports to the United Kingdom and to the
United States were of great value to Poland, partly because they
permitted the country to escape German economic domination and
partly because they enabled her to earn free currency which could
be used to buy goods which Poland really wanted from the cheapest
source of supply. The important part played by Italy, the
Scandinavian countri6s, and western Europe in Poland's trade is
also worth noting; especially in the case of the Scandinavian
countries and of Italy, this was due mainly to the large purchases
by these cquntries of Polish coal.
The most important Polish suppliers in 1937 and 1938, with
their respective shares in total Polish imports, are shovm in
- 19 -
the next table:-
TABLE VI
Poland's Imports in 1937 and 1938 from its Leading Suppliers
Percent ofMillion Zloty Total Polish
Country. (annual average) Imports
Germany and Austria 269 21.2United Kingdom 148 11.6United States 154 12.0Holland 47 3.7Belgium 55 4.3Czechoslovakia 42 3.3India 43 3.4France 43 3.4Australia 33 2.6
TOTAL 834 65.5
Source: Concise Statistical Year-Book of Poland,September, 1939 - June, 1941
Comparison of Tables V and VI shows that the United Kingdom
was much more important to Poland as a market than as a source of
surply. In other vwords, in her dealings with the United Kingdom,
Poland had an export surplus which helped to finance her supplies
from overseas, very largely from the British Commonwealth and
empire and the United States; in fact, while India and Australia
were among Poland's ten most important suppliers, they were not
among the country's ten most important export markets.
As a supplier the importance of the United States was prac-
tically the same as that of the United Kingdom; in 1938 the
United States actually became the more important source of supply.
As an export market, on the other hand, the United States ranked
fairly low on the list. In fact, Polish foreign trade, although
balanced as a whole, consisted of an intricate network of export
and import surpluses with different countries; on the whole
Poland financed her imports from overseas by selling to Europe.
Poland's total foreign trade, hovwever, was not large. For
- 20 -
1926 - 1935, on a per capita basis, it was about one-tenth of
that for the United Kingdom, Belgium, Holland, Norway or Switz-
erland; and one-fifth of that for France, Germany or Czechoslo-
vakia. Comparing foreign trade with the national income of the
country her imports in 1938 were equal to only seven and a half
percent of the national income, and her exports were equal to
seven percent. The country's prewar volume of foreign trade
did not, however, reflect the full trading potentialities of the
country, and postwar changes in territory have vastly increased
Poland's potential importance in world trade.
One further point may be noted - the small volume of trade
with the U.S.S.R.. a country with an even smaller foreign trade
per head of population. The main reason for this low volume is
that the main exports of the two countries were similar. Both
exported agricultural produce and timber; the industrial goods
which Poland needed could not be spared by the U.S.S.R. which
was itself engaged in a process of heavy and sustained
industrialization.
Composition of Polish Foreign Trade
Turning from the distribution of Polish trade bet,ween
countries to its composition by commodities, the following
table throws light upon the major items which Poland exported
and imported in 1937 and 1938:-
- 2.1 -.
TABLE VII
Polish Exports in 1237 and 1938
Million Zloty Percentage ofCommodity (annual average) Total Exports
Agricultural Products 318 26.7Hams, hams in tins 55Bacon 47Pigs 35Eggs 36Other animal products 52Barley 40Other crops 53
Coal 201 16.8
Timber 200 16.8
Iron and Steel 74 6.2
Zinc 32 2.7
All others 365 30.8
TOTAL 1,190 100.0
Source: Concise Statistical Year-Book of Poland,London, 1944.
As Table VII shows, in 1937 and 1938, 60 percent of Poland's
exports consisted of agricultural products, coal and timber.
These may be considered to be Poland's three staple exports.
Agricultural products accounted for over one quarter of all ex-
ports, animal products representing 70 percent of these. Poland
concentrated on the more highly processed animal products such
as hams, hams in tins, bacon and eggs. Pigs were also exported
in large numbers. Coal and timber each accounted for about one
sixth of total exports. Iron and steel accounted for 6.2 percent
of all exports and were exported as raw iron and steel, railway
rails, sheets and tubes.
TABLE VIII
Polish Imports in 1937 and 1938
Million Zloty Percentage ofCommodity (annual average) Total IYmports
Main raw materials 519 4o.8Textile Raw Materials 287Raw Hides and Skins 82Scrap Iron 69Ores 35Copper 31Rubber 15
Main Manufactured Products 326 25.6Machinery 205Chemical & Pharmaceutical 71Paper 8 Paper products 25Clothinig 25
Main Food, Drink and Tobacco 159 12.5Fruit 38Herrings 23Coffee, tea, cocoa 22Seeds, Fats and Oils 36Tobacco 40
All Other 268 21.1
TOTAL 1,272 100.0
Source: Concise Statistical Year-Book of Poland, London, 1944
Poland's main imports fall into three groups; raw materials,
manufactured products, and food, drink and tobacco. The main
imports of raw materials were textiles and hides and skins for
the clothing industry, which together accounted for about 29 per-
cent of all imports.- Scrap iron and ores together accounted for
another eight percent of imports. Adding rubber and cotton,
these principal raw materials together accounted for 41 percent
of all imports. Manufactured products were imported on a large
scale; machinery accounting for 16 percent of all imports, adding
chemicals, paper products and clothing, this group accounted for
26 percent. Food products were mainly items which could not be
produced in Poland, such as tropical fruits, coffee, tea and
- 23 -
cocoa, tobacco and sea fish. The foods enumerated in the table
accounted for one eighth of all imports. Mineral clays, pottery
and glass wiere also imported.
In nearly all classes of goods, Poland was both an exaorter
and an importer. In some important industries Poland may be said
to have occupied an intermediate position, in general exporting
raw! materials and semi-manufactures and importing manufactured
products. The steel industry, for example, imported ores and
scrap iron, exported intermediate products, but, again, imported
finished products such as cutlery. Similarly in the paper indus-
try pulp was exported while paper and cardboard were imported.
Notwmithstanding the small volume of its foreign trade, Poland
depended to an unusual degree on international specialization,
relying on foreign countries for highly processed manufactures.
As far as foreign trade was concerned, Poland might perhaps
best have been described as a semi-agricultural country with
three staple industries - coal, textiles and steel - and strong
traces of industrialization elsewhere but lacking in engineering
industries and their wide ramifications. It is evident that a
country in this position - lacking in industrial balance and
still at an evolutionary stage of economic development - should
have been specially dependent on foreign trade for the manufac-
tured products consumed by its population, and for the capital
equipment required for the development of its industry.
III. POSTWAR CIIANGES
Before dealing with postwar changes in Poland's basic re-
sources and their implications for the country's future foreign
trade, attention must be called to the special circumstances
resulting from the severe devastation of agriculture, and the
- 24 -
wholesale destruction or removal of industrial plant and trans-
port facilities, which Poland suffered during the war. These
circumstances have created immediate foreign trade problems com-
pletely different from those of a long run character. Owing to
devastation, production has been reduced drastically while, on
the other hand, requirements for rehabilitation of agriculture
and industry far exceed normal peacetime demand. Thus, Poland
cannot in the short run export agricultural products or timber,
and she must import capital equipment on a scale far in excess
of that before the war. It is clear that, in these circumstances,
imports will exceed exports for several years in order to provide
the necessary investments in Polish agriculture and industry; it
will not be until production has increased to prewar levels, and
industrial rehabilitation is complete, that any equilibrium be-
tween imports and exports could be achieved. In view of the fact
that, for many years to come, Poland will be a relatively undev-
eloped country, she is "import unended" and expects a continuance
of investment from abroad in the form of an excess of imports
over exports.
The war has brought -radical changes in Poland's long term
prospects of foreign trade. The acquisition of the recovered
territories has more than doubled Poland's industrial capacity;
Poland has acquired a greatly increased coast line, including the
port of Szczecin (Stettin) as well as the important river Oder;
in spite of the net loss of one-fifth of its area the country's
agricultural production could be the same as before the war; the
population has been reduced by 30 percent. All these important
changes will have great repercussions on Poland's foreign trade,
The national income of the country will increase in the long run
-25-
by roughly 50 percent and the national income per head by over
100 percent. This also will have repercussions upon foreign
trade in that, along with a higher standard of living, will
develop an increased demand for luxury articles from abroad.
There is thus likely to be not only a great expansion, but also
a change in the composition of both Poland's imports and exports.
Her exports are likely to include more coal, more food, and more
semi-manufactured products, while her imports are likely to in-
clude greater quantities of highly manufactured articles and
certain raw materials. Although the immediate postwar transit-
ional problems strongly affect the country's trade, the new long
term pattern of normal trade will gradually emerge and after
some time assert itself.
Prospective Changes in Exports
Losses
Timber: It is very unlikely that Poland will ever again
export timber on the scale she did before the war, when timber
and wood products accounted for 17 percent of all her exports.
Frontier changes caused a decrease of some 17 percent in the
Polish forest area and there are now only about 6.9 million hec-
tares under forests as compared with 8.3 million hectares in
prewar Poland. Production of timber will,however, for some time
be far below the 83 percent of prewar production which might be
indicated by the change in forest area. About 400 thousand hec-
tares were destroyed by the Germans by indiscriminate cutting
during the war and another 800 thousand hectares were extensively
thinned for use chiefly for mine props and pulp wood. The Germans
cut about ten yearls normal cutting during their occupation; as a
result the annual increment of forest growth has fallen
- 26 -
sharply. Whereas before the war about two cubic meters per hec-
tare were obtained, at the present time the annual increment is
only some 1.5 cubic meters. In view of the urgent need for re-
building the country it is estimated that during the whole of
the Four Year Plan cutting will exceed the annual increment by
about 25 percent; even so there will remain a large deficit of
8-10 million cubic meters of timber and forest products annually
which can only be met by imports.
Turning to the long range prospects of Polish timber exports,
the situation obviously depends on the extent of re-afforestation
and the extent to which the annual increments obtained before the
first world war, which amounted to 3.2 cubic meters per hectare,
can be regained. In the year 1939 about 2. million cubic meters
were exported out of the annual production of ten million cubic
meters i.e. 25 percent, thus, if demand ultimately falls to the
same level as before the war it would be expected that about one-
third of the prewar exports could still be achieved ir the long
run. It is likely, however, that Poland's increased industrial
apparatus will greatly increase the requirements of timber in
Poland and an increase of only ten percent above prewar levels
wvould, unless the annual increment exceeded prewar levels, elim-
inate the possibility of exports. It is clear, therefore, that
exports of timber from Poland are impossible for one or tvwo' de-
cades and that, even afterwards, resumption of exports will de-
pend upon greatly expanding the annual increment in forest
growTth.
Food: Devastation of Polish agriculture has, for all prac-
tical purposes, eliminated the possibility of Poland exporting
food until 1949. Immediately after the war crop production was
- 27 -
only some 35 percent of Drewar levels, and the livestock popula-
tion was reduced to 57 percent of prewar in the case of horses,
40 percent in the case of cattle, and 30 percent in the case of
pigs. It is clear, therefore, that, although the population of
Poland has fallen by some 30 percent, there is, instead of the
surplus of foodstuffs for export which existed before the war, a
serious deficit. In the food year 1946/47, for example, produc-
tion is about 38 percent of prewar, yet the amount of food needed
for internal consumption on prewar standards is about 64 percent
of prewar production; there is thus a deficit of about a quarter
of the prewar production. Even at the end of the Four Year Plan,
in 1949, production will only have recovered to 80 percent of
prewar production, but it should be possible, because of the fall
in the population, to export about half the value of the food ex-
ported before the war. Until this date there will be some sur-
pluses of pork, poultry and eggs. Most if not all of the foreign
exchange obtained from such exports, however, will be needed to
import other foods of high calorie content in order to increase
the total calories available for the Polish population.
The export of particular foodstuffs is not inconsistent
with the general deficit in Poland, which will persist at least
until the end of 1947. Poland may thus export certain highly
processed luxury foodstuffs in 1947 so as to obtain in return
larger quantities of special foods and, in particular, fats, of
which there is a grave shortage, Ham and eggs, for example, may
be exported to obtain in exchange twice the number of calories
in the form of fats or fish. Furthermore, pigs and poultry pro-
vide means of utilizing the large quantities of waste which is
generated in a peasant farming system. In 1947 there will be
- 28 -
taken exports of this type of food and in 1948 they should
increase considerably.
The long run prospects for Polish food exports are very
favorable -/. Although the country is one-fifth smaller in area
than before the war the areas taken over from Germany were very
productive and, by achieving prewar standards of cultivation
throughout Poland, agricultural production could ultimately be
about the same as before the war. With a reduced population
consuming on prewar standards this would leave a margin for ex-
port about five times as great as before the war. If, however,
as will obviously be the case, the standard of food consumption
in Poland increases, exports would not expand to this extent. It
would, however, be safe to say that, even witb a considerable
increase in domestic consumption, food exports could be three
times as high as before the war, on present values, some 300
million dollars per annum. It should be noted, however, that
much more fertilizer was appliQd to land in the recovered terri-
tories than to land in the areas transferred to the U.S&S,R. and
the attainment of prewar levels of production would involve
greatly increased imports of fertilizers.
PotaEsium:
Before the war, the annual production of 560 thousand tons
of potassium salts resulted in valuable exports of such salts;
since as a result of frontier revision, Poland's entire resources
of Dotassium were transferred to the U.S,S.R., such exports are
no longer possible.
1/ See UNRRA Regional Office, Food and Agriculture in PolandOperational Analysis Paper N_o. London. 1947
- 29 -
Oil. Owing to territorial changes Poland has lost about
three-quarters of her former oil production. Although this does
not affect Poland's exports, it will affect her balance of pay-
ments by creating additional import needs.
Gains
Coal: The Silesian coal field, which contains the largest
knovm coal resources in continental Europe, resources said to
be eveniarger than the Ruhr or the Don, is now within Polish
territory. Once the mines are brought back to prewar levels of
production, this should increase the country's coal production
by as much as 28 million tons, or raise it to 80 percent above
the prewar level. It is clear that, although there will be in-
creased demands for industry and transport in Poland, the export-
able surplus of coal, coke and coke products will be even larger
than before the war and that these exports wrill become the main
pillars of the Polish export trade.
Rehabilitation in coal production is making good progress;
by Dec3Tbher 1946 the mines were producing at 85 percent of their
1937 or-cuction, and their total output was already 50 percent
greater than Poland's prewar production. In the year 1946 pro-
dUctM-1o. In the year 1946 production was 47.3 million tons and
exporLw amounted to 14.2 million tons, more than before -nhe war.
It is planned that by 1949 production will have expande to 80
million tons of which 35 million tons will be exported, three
times as much as before the war. In that year the value of coal
exports, at current prices, will be some $350 million. Ultim-
ately coal production is expected to reach 100 million tons per
annum,
Export prospects for the future are excellent. Great
- 30 -
Britain has dropped out of the export market, German production
is only a fraction of prewar levels, Demand, on the other hand,
is higher than ever before throughout Europe. Industrial pro-
duction in Denmark, Norway, Sweden, the U.SoS.R., France and the
Balkans depends to a large extent on Polish coal for its source
of power, and for many years to come it is likely that Poland
will have little difficulty in selling coal abroad. She wJill,
therefore, be able to derive valuable imports from her exports of
this much desired international commodity. Even if British and
German production recovers sufficiently for these countries to
resume exports, it is likely that Polish coal will continue to
maintain its advantage since output per head was always high,
much higher than in the Ruhr or the United Kingdom and, further-
more, levels of vwages in Poland were much lower than in these
countries.
Poland's coking capacity has benefitted even more than her
prospective coal output from the acquisition of German Silesia.
Poland has acquired one and a half times as much as her old
capacity from Germany, bringing the total capacity today to two
and a half times what it was before 1939.
Iron and Steel: Production capacity of the iron and steel
industry has also been greatly increased by territorial gains in
the West - pig iron capacity by abou-t one-half and hot rolled
products by about 40 percent. It is difficult to estimate bow
far iron and steel exports could expand beyond the level pre-
vailing before the war. Potential Polish industrial capacity is
more than double that before the war and may well absorb the
whole of the increased production available. At present rehab-
ilitation of the iron and steel industry is extremely difficult,
- 31 -
since it requires a great deal of investment in modern equipment,
particularly in rolling mills. Although iron and steel produc-
tion will expand steadily through the Four Year Plan, from 800
thouosand tons of rolled steel productsin 1946 to 105 million
tons in 1949, requirements of industry, communications and re-
construction will expand much more rapidly and, far from there
being any prospect of resumption of exports, there will be an
increasing deficit.
Non-Ferrous metals: Increased deposits of lead and zinc
will more than double Polandts prewar output of these metals,
and have already resulted in greater availability for export.
Here again, however, expansion of exports beyond prewvvar levels
depends upon the requirements of Poland's expanded industry. It
is likely, however, that a marked increase in Poland's export
of non-ferrous metals will take place. However, since Poland
has now acquired a large amount of zinc and lead ore capacity,
production of these metals will, in the future, not be based on
imported ore.
Other Gains
In addition to the coal, iron and steel and non-ferrous
metals industries, Poland has acquired considerable industrial
potential in the west, particularly in the remainder of Upper
Silesia (formerly belonging to Germany) and in Lower Silesia.
Great reserves of power derived from coal and water together
with such minerals as cadmium, cobalt, gypsum, gneiss and knolin
for the natural basis for industrial development in this area.
Before the war, the ceramic, cement, glass, cotton and flax
industries of Silesia were well known for the quality of their
-tn"^AIl+ Inl OhQa -;n ̂ -n s t MI .r c, 7 4-Qfrt 4 4,.of>
- 32 -
large industries including electrotechnical and chemical works,
factories producing photographic, optical and medical equipment,
paper mills, food processing plants and saw mills.
All these industries suffered considerably from direct war
devastation as well as from the removal of machinery. There is
not enough information available at the present moment to
estimate their potential to provide surpluses for export. How-
ever, since before the war roughly seven percent of the Agricul-
tural and Industrial production of these territories were ex-
ported, it is quite probable that the industries located in the
territories acquired by Poland under the Potsdam agreement will,
in general, materially add to the country's export possibilities.
The acquisition by Poland of the River Oder and the port of
Szczecin, plus the rail and canal network of the recovered terri-
tories, has greatly enhanced the prospects of a considerable
transit trade. Even at the present moment transit trade by land
and water is proving a profitable invisible export. In the long
run, prospects are very favorable. If a canal is constructed
joining the Vistula and the Danube, and canals completed in
east-west and north-south directions, a vitally important system
of waterways based on the Oder, Vistula and Danube would be
created. There is no doubt that considerable traffic wiould take
advantage of this network of waterways linking Eastern and Cen-
tral Europe with the Beltio and the North Sea. The development
of this system of inland transport will involve large scale in-
vestments and could not, of course, be completed for many years.
Nevertheless, profits from transit must be expected to assume a
rapidly growing importance in Poland's balance of trade.
- 33 -
Changes in Import Requirements
As in the case of exports, changes in Polish import reauire-
ments are due to two factors. W.ar devastation has created needs
for imports which are of a temporary character while territorial
changes have created permanent changes in the structure of Polish
imports. It is clear that the immediate needs for rehabilitation
will be modified during the next few years and that, gradually,
as all economnic resources are mobilized, the permanent character-
istics of Polish imports will become apparent.
The table below shows developments during the next three
years -
TABIE IX
Polish Import Requirements 1947 - 1949(in million U.S. dollars)
1946 1947 1948 1949
Food 195 136 20 10Other consumption goods 30 7 - -
Total consumption goods 225 143 20 10
Raw materials and intermediateproducts 110 223 300 350
Basic investment goods n.a. 118 275 315Other investment goods n.a. 30 70 lO1
Total investment goods 148 148 345 415
Grand Total 483 514 665 775
Source: Polish National Economic Plan (ProvisionalFigures), Warsaw, 1946 and UNRRA Missionto Poland.
The table shows that, in 1947 as in 1946, consumption goods
(principally foodstuffs) and raw materials are the most important
imports. Tn 1948 and 1949 consumption goods disappear almost
entirely, raw materials increase steadily while investment goods
t.n rpnmane wn.r l 1en, r-nme t1ip arpatpqt. nn-of-. nf impnrt.
- 34 -
requirements.
Only after 1949, when the bulk of the imports of investment
goods should have come in, will the normal structure of irmports
develop. This will consist of a much "larger preponderance of
raw materials and semi-finished products, although the increased
size of the industrial economy will also involve appreciable im-
ports of investment goods for replacement and modernization. In
the case of raw materials in some instances smaller exports will
be required; wherever industry in the ex-German territories was
complementary to industry in the old Polish territories, and
movements of raw materials from one to the other resulted, these
movements will now be eliminated. But in other cases the in-
balance between industrial capacity and raw material supplies has
been accentuated by the transfer of capacity from Germany to
Poland and a more than proportionate increase in imports of raw
materials will be required.
Industrial and Transport Equipment: It seems fairly certain
that the development of the industrial capacity of the important
industrial areas of lower Silesia, the ex-German part of upper
Silesia, and other areas of Eastern Germany with their wide range
of finishing industries, will gradually bring about Poland's in-
dependence from imports of a variety of semi-manufactured and
finished goods. Once production in the western territories
reaches full capacity, Poland might even acquire an exportable
surplus in some of them. On the other hand, the very enlarge-
ment of industrial capacity will create increased needs for in-
dustrial machinery, and for maintenance and renewal items. A
large part of Silesian industry is equipped on old-fashioned
- 35 -
ization, all of which will require equipment which cannot be
produced in Poland over many years to come. On the whole Poland
will thus be dependent on imports for a considerable quantity of
industrial and transport equipment such as modern plant for the
iron and steel and engineering industries, motor vehicles, river
barges and cranes,5 and machines and parts of all kinds.
Petrol and Oil
Before the wiar Poland produced about 507 thousand tons of
crude oil and did not import or export to any extent. In 1946,
however, on account of the loss of three-quarters of her pro-
duction, she had to import just over 300 thousand tons in the
form of final products. The needs of a greatly expanded Polish
industry and a greatly enlarged fleet of motor vehicles has
increased requirements, and there is no doubt that they will
continue to expand. Every effort is being made to expand pro-
duction by drilling new wells, hut the possibilities of expansion
are limited. While Poland has acquired some large German
synthetic oil plants, these are at present in a state of virtual
destruction; even when plans for the re-establishment of the
synthetic oil plant it Oswiecim are realized, domestic output
wrill be insufficient to fill Poland's needs. Petrol, oil, and
lubricants will, therefore, become regular items on Poland's
import list and far exceed the 1946 level of 300 thousand tons.
Raw Materials
The acquisition of the ex-German industry will, of course,
require the importation of larger quantities of raw materials.
Furthermore, in some industries there is now greater lack of
balance between capacity and raw material supplies. Whereas the
capacity of the steel industry has increased by about 50 percent,
- 36 -
iron ore resources have increased by a bare ten percent; heavily
increased imports of iron ore are therefore inevitable.
Similarly, important new woool-combing and other textile
caDacity has been acquired, especially in Lower Silesia, without
any corresponding acquisition of cotton and wool. In the chemi-
cal industry, too, expansion has been mostly on the manufacturing
side without corresponding additions to raw material supplies.
Fertilizers
Poland is certain to be an importer of fertilizers on a
* considerable scale. Although agricultural production per hec-
tare in the western territories exceeded that in the territories
transferred to the U.S.S.R., the soils are relatively unfertile
and output can only be maintained by large applications of fert-
ilizers. Whereas, in old Poland, application of fertilizers per
hectare was about three kilos Qf nitrate, four of phosphates
and three of potash, in the new territories application wras much
larger, namely 18 to 20 kilos of nitrates, 20 to 25 of phosphates
and up to 30 of potash per hectare. As a result, fertilizer
requirements in present day Poland, in spite of a reduction of
one-fifth in its area, will ultimately reach twice the level
before the war. The total requirements will eventually reach
some 250 thousand tons of nitrate, 300 thousand tons of phos-
phates, and 325 thousand tons of potash salts, annually. These
amounts would be required merely to pursue the prewar system of
farming, but the decrease of livestock, brought about by the
war, has greatly decreased supplies of animal manure and, until
the livestock population is rebuilt,needs will be higher.
Although after the year 1947 it is anticipated that domestic
- 37 -
production of nitrates will satisfy requirements there will be
serious deficiencies in phosphates and potash amounting to some
85 thousand tons of phosphates in terms of B203 and 80 thousand
tons of potash in terms of K2 0 annually. It is clear, therefore,
that fertilizers will loom large in Poland's postwar requirements.
The Future Outlook
To sum up, wide scope exists for a general expansion of
Polish foreign trade. The Commodity structure of that trade is
bound to be different from that of the prewar years. Among
exports, coal, zinc and possibly finished industrial products
will be more important than before; timber and fertilizers less
important. Among imports, industrial raw materials, especially
textiles, ore and oil will become more prominent; steel products
and chamicals may recede in importance.
President conditions seem favorable to an expansion of
overseas trade; Poland has acquired a good seaboard and first-
class ports and two important limiting factors of the prewar
period have thus been removed. After its heavy war losses her
merchant fleet is gradually increasing. At the end of the war
it was only some 150 thousand deadweight tons, but as a result1/
of the acquisition of some 80 thousand tons from reparations
plus another 65 thousand tons from new building and purchase, it
1/ According to the Potsdam Agreement and the agreement with theTU.S.S,r . of August 16th, 1945, Poland is to receive 15 percentof the quota collected by the U.S.S.R. from its occupationzone and 15 percent of the reparations collected from thewestern zone of Germany, both free of charge, and in exchangefor deliveries to these zones. In return Poland is to delivereight million tons of coal in 1946, 13 million tons in each ofthe years 1947 to 1950 and 12 million tons per annum there-after throughout the occupation of Germany. All these de-liveries will be at a special price. It was agreed, in March1947, however, that these coal deliveries will now be halved.
- 38 -
is expected that, by the end of 1949, the fleet will be sorne 295
thousand deadweight tons.
Changes in the Direction of Poland's Foreign Trade
Poland's first postwar trade agreements were dictated to a
large extent by transport possibilities, available surpluses on
both sides, and the urgency of the immediate needs of each of the
contracting parties. Ever since liberation, the Polish Govern-
ment has adopted a positive attitude towards the development of
international trade and has shown no desire to put obstacles in
the way of its expansion in any direction. Most continental
countries will presumably continue to trade with Poland roughly
approximately according to the prewar pattern, subject to the
shifts arising out of Poland's ohanged industrial structure. In
particular, the acquisition of a convenient seaboard, the avail-
abilitIy of greater export surpluses of coal, and the greater
needs for imported iron ore should all work in the direction of
increased trade with the Scandinavian countries,
In the trade with Germany, the U.S.S.R., the U.S.A. and
with the U.I,, however, some more fundamental changes are
apparent.
Germany: As a result of the changed economic structure of both
countries resulting from territorial changes, Germany's share in
Poland's trade is likely to be far less than before the war.
Agreements concluded in August 1945 and February 1946 provide
for the resumption of trade to the extent of about 21 million
U.S. dollars with the U.S.S.R. Occupied Zone. The commodities
imported into Poland included fertilizers, synthetic rubber, oil
and chemical products, thus reflecting the changes in the commod-
ity structure of Polish imports discussed above; in return,
- 39 -
Poland exported coal, coke, benzol and naphthaline.
As for the future, it seems likely that Poland will export
manufactured products and coal to Germany. lWhat Germany could
sunply in return will depend upon the character of Germany's re-
constructed economy, but the bulk of the exports are certain to
be raw materials and semi-finished products. The commodities
included in the Polish-German eastern zone agreement provide at
least an indication of the type of articles likely to figure in
the German exports from this zone. As regards the western zone,
there is no doubt that German industry in the past supplied
Poland with an appreciable proportion of its industrial equipment;
the extent to which such imports could be resumed will depend
upon allied policy regarding the re-establishment of German
engineering and manufacturing industries. It would seem likely
that, if there is to be any solution to the present economic
crisis in Germany,such production will be expanded, and Poland
might well receive a part of the output.
U.S.S.R.
One of the most important new features in Poland's foreign
trade is the emergence of the U.S.S.R. as one of Poland's leading
trade -artners, although the abnormal emergency aspect of this
trade in the months during and after liberation must be emphas-
ized. Apart from UNREA imports, which were very small in 1945,
trade in that year with the U.S.S.R. accounted for over 90 per-
cent by value of Poland's total foreign trade. It should be
remembered that trade with the U.S.S.R. began before the end of
hostilities when the Polish Government was still cut off from
contacts with the west and at a time when conditions in the
country wrere chaotic. At that time, the problem facing the
- 40 -
Polish Government was not so much that of obtaining supplies on
favourable terms, as that of getting any supplies at all. Apart
from the U,S,S.R there were no alternative sources for such ess-
enti2al commodities as iron ore, wool, cotton and patrol. Equally,
no country but the U.S.S.R. was in a position to take delivery
of coal from Polish pitheads (practically the only export which
Poland had to offer in exchange) in its own transport at a time
when Polish railway transport was practically non-existant.
These extraordinary circumstances still persist, though to a
lesser degree, and they should be borne in mind when reviewing
the long-run prospects for Polish-Soviet trade.
The importance of the U.S.S.R. in Poland's foreign trade
should not be over-estimated. In 1946, 69 percent of all Polish
imports were provided by UNRRA, Which consequently was the great-
est single source of Poland's imports; the contribution of the
U S.S.R. to UNRRA supplies was, of course, small, the bulk being
supplied by North and South America and the British Empire. At
the same time, it should be remembered that 201 million dollars
out of the total UNRRA program of 481 million dollars was supp-
lied in the form of food and these are imports which will soon
disappear entirely. Furthermore, the share of the U.S.S.R. in
normal foreign trade is diminishing, it fell from over 90 percent
in 1945 to 57 percent in 1946. As other means of financing
Poland's rehabilitation are found, the share of the U.S.S.R. in
normal foreign trade will diminish even further. Nevertheless
it will remain a very important factor. The Soviet Union is the
nearest source of textile raw materials, hides, furs, fertilizers,
petrol, manganese ores and timber, all of which Poland needs
urgently. If the cost of overland transport can be kept at a
- 41 -
reasonable level, the U.S.S-R. may also prove the cheapest -ource
of supply. On the other hand, the U.S S.R. too will be hard
pressed by the enormous tasks of reconstruction, repair and fur-
ther industrialization which confront it, and Poland cannot look
to the U.S,S.R. for much of the capital equipment required for
reconstruction of industry. The fouldations at least for mutu-
ally satisfactory trade in good volume are clearly present,
though Poland's great needs for industrial and transport equip-
ment mean that, in the next few years, the proportion of her im-
ports received from the U.S.S.R. will rapidly diminish.
The United States
The development of trade between Poland and overseas coun-
tries is a difficult problem at the present time. There is no
doubt that, owing to the disappearance of Germany as a source of
industrial equipment, Poland requires imports from these coun-
tries on a very large scale. She requires industrial raw mater-
ials, such as raw textiles and rubber, and industrial equipment
for rehabilitation of industry and transport. The problem,
however, is to find means of paying for these imports. UNRRA
has enabled Poland to obtain roughly 481 million dollar's worth
of such supplies without making any corresponding exports, but
with the demise of UNRRA it will be impossible to finance these
imports, since Poland is not in a position to supply goods or
services which are required by overseaa countries. Thus, her
prewar exports of timber and food, which provided her with the
free exchange for overseas purchases before the war, are no
longer available in any volume. Coal, which she can export in
large quantities, could not be exported to distant overseas
countries on account of transport costs. Until her food pro-
- 42 -
duction increases to the extent necessary to permit her to resume
exports of highly processed foods, or until she can find other
products which she can produce and sell to those countries, she
will, therefore, be confronted with this difficulty of financing
imports from overseas.
The United States will undoubtedly have to supply the major
part of the capital equipment required for Polish industry and to
this extent will become of major importance in Polish foreign
trade during the next few years. Poland also requires supplies
of raw cotton, and a long list of other items from the U.S.
These imports will, at least in the short period, have to be
financed out of credits, although, when food production recovers,
there will, no doubt, be a market in the United States for high
quality Polish hams, fruit, mushrooms etc., as well as for
Polish handicrafts and perhaps glassware and china. Although the
United States will become a major supplier of Poland's imports,
her imports from Poland will never become very important. Apart
from credits Poland must rely largely upon obtaining foreign ex-
change from her exports to other countries in order to buy in
the United States.
The United Kingdom
The United Kingdom produces much of the capital equipment
that Poland requires to rebuild her industry. However, owing to
the devastation of Europe and the needs of British industry,
possibilities of Poland Dlacing orders in the U.K. are limited.
There is no doubt, however, that in the long run, Britain can
again provide Poland with large quantities of manufactured pro-
ducts. In this case the long period prospects of foreign trade
are very favorable since the U.K. will be a market for Polish
- 43 -
food, zinc, cement, and chemicals on a considerable scale.
Other Countries
Poland will also require, in the long run, considerable im-
ports from distant overseas countries in the form of tropical
products and raw materials. She has already entered into comm-
ercial relations with the Argentine, Brazil and the Wear East.
Exports to these countries could take the form of zinc, iron and
steel, chemicals, glassware, china and possibly finished textiles.
IV. FOREIGN TRADE SINCE LIBERATION
After liberation Poland commenced the tremendous task of
rehabilitating and reconstructing her economic life. Of necess-
ity the bulk of the materials and equipment for this purpose
had to be found within the country, but there existed extensive
needs, including those required to repair the great devastation,
which could only be met by importing on a large.scale. At the
same time there was, of course, the urgent need for imports
of food and clothing to feed and clothe the Polish population
0 during the emergency period immediately following the war. It
was obvious that the complete dislocation of transport would
impose most serious limitations upon the extent of imports from
other countries, and, in the early stages, imports had therefore
to be restricted to food and clothing to most relief needs, and
transport material to enable Poland to rebuild the transport
system as rapidly as possible. During the year 1945 foreign
trade, even including UNRRA supplies, was very small in volume;
as a rough estimate, the volume of imports in 1945 reached only
some 30 percent of prewar levels. During 1946, however, the
internal transport situation, and the port facilities, improved
rapidly, and trade expanded to nearly four times the level in
- 44 -
1945. During this year the importance of imports outside UNRRA
supplies increased considerably, and the foundations were laid
for normal foreign trade.
Exports throughout the two years remained at a very low
level; they would have been far smaller had it not been for the
large coal exoorts which were made possible by the acquisition of
ex-German mines. Naturally, the development of exports was poss-
ible only as industry was rehabilitated, and during the rhole of
1945 and 1946 imports were some three and three quarters times as
great as exports. This excess of imports over exports was a
symptom of the relief and rehabilitation needs of Poland and the
fact that she could not pay for her imports with exports; it
made possible relief of hunger and immediate essential investment
in both agriculture and industry. This situation wrill persist
throughout the whole of the four year plan. Though the need for
emergency food imports will disappear after the 1947 harvest, the
needs of industry and transport will more than counterbalance the
disappearance of food needs, and necessitate further overseas
investment on a large scale.
It was obvious that, in the first months after liberation,
the bulk of Poland's imports would have to come from UNRRA, which
set up a program of some 481 million U. S. dollars. During 1945
UNRRA imports were twio and three-quarters times as great as other
imports. Voluntary Societies also commenced operations in Poland,
which although not on so large a scale as UNRRA provided several
million dollars during 1945. Ow^ing to the fact that the U.S.S.R.
had gradually liberated the country from the East, trade with the
U.S.S.R. was naturally the first to recover after the war; during
1945 it accounted for 93 percent of the normal foreign trade.
- 45 -
Poland speedily tackled the problem of resuming normal trade
relations with the rest of the world. Naturally, her first att-
empts were directed towards Scandinavia and the Balkan countries
because her exports consisted mainly of coal and coke, which are
very costly to transport, and transport facilities governed the
direction of her foreign trade. During 1946 trade agreements
were concluded with 17 countries, covering almost every country
in Europe. Although normal trade was thereby expanded to four
times the 1945 level, the UNRRA imports were again the predominant
factor in foreign trade and were 70 percent greater than other
imports. The share of the US.S .R. in normal trade fell to
some 57 percent of the total trade.
Commercial Agreements
Some of the postwar changes in the organizatinn of Poland's
foreign trade were described in a previous chapter of this paper.
The greatest change, however, is the predominant part played by
trade agreements in Poland's foreign trade. The reasons for
this method of trading are shortage of foreign exchange, Poland's
surplus of coal, Poland's urgent needs for certain vital raw
materials, and transport difficulties. Having no reserve of
foreign exchange at her disposal, and in view of the currency
restrictions which prevail in most parts of the world, Poland
was forced to make individual agreements regarding the commod-
ities to be imported in exchange for her exports. In view of the
European coal shortage, she found herself in a favorable position,
through her coal exrorts, which were vital to industry in many
European countries. to insist upon receiving certain raw materials
essential for the resumption of industrial activity. Finally,
transport difficulties restricted her exports to neighboring
-46-
countries and, as most of these wlere in a similar position to
Poland with respect to devastation anid foreign exchange, she was
compelled to enter into barter agreements with her neighbors.
Thus the trade agreements which Poland had concluded since the
end of the war follow the same general pattern of barter
compensation,
The main principles by which they are governed are:-
1. The quantities of each commodity to be delivered
by each party are specificallyr listed in the
* agreement
2. The commodities to be exchanged must balance in
value at world market prices
3. There are no cash payments between the contracting
countries5 the settlement of accounts being
effected by entries in the books of the res-
pective National Banks. Amounts due for goods
supplied are paid by each National Bank to the
supplier in national currency
4. Prices and other terms and conditions of sale are
negotiated by Government organizations, or by
private corporations or firms in each country,
subject to the approval of their respective
Governments
5. Execution of trade agreements is controlled by
mixed commissions composed of representatives of
each country
6. Both Governments collaborate in providing the
necessary transport and transit facilities
- 4I7 -
Some deviation from the original, pure barter character of
these agreements takes place in the agreement with Sweden.
Sweden granted Poland a credit of 100 million Svwedish kroner
which will be gradually repaid as Polish exports to Sweden are
developed. The Agreement also provides that Poland will receive
"free" currency for about one-half of her exports, thus enabling
her to use this for purch4seS in other countries.
The trade agreement with Switzerland provides for a credit
of 40 million Swiss francs, as an advance on Polish exports of
coal, to be spent in Switzerland. Since these exports will ex-
tend over a period of over a year - until the end of September,
1947 - the arrangement gives Poland the possibility to order
urgently needed imports immediately. The agreement also provides
that when Polish coal exports to Switzerland will have reached a
total of 20 million Swiss francs, a further credit of 40 million
Swiss francs will be opened. Similarly, credit clauses are in-
eluded in the agreements with France, Denmark and Italy to enable
Poland to place orders for goods vwhich cannot be delivered
* immediately.
All the trade agreements which Poland has concluded after
liberation are listed in the following table. This shows that,
by the end of 1946, agreements vwere concluded with 17 countries
for a total trade turnover of 830 million dollars. These trade
agreements would be sufficient to provide Poland with imports
valued at 415 million dollars, though, in many cases, delivery
is still going on and will only be completed during 1947.
48
TABLE X
Poland's Trade Agreements Concluded after Liberation
Values as Expressed Value inDate of in the Agreement iViillion
Country Agreement (Imports plus Exports) US Dollars
U.S.S.R. July, 1945 190 million gold zloty 59.00July, 1945 595 million gold zloty 186.00April, 1946 192 million US dollars 192.00
Sweden August, 1945 440 million Swmedish kroner 10000Denmark Augusti', 1945 54 million Danish kroner 11,25
October, 1946 258 million Danish kroner 53.75Italy October, 1946 1560 million Italian lire 40*00France July, 1946 34 million US dollars 34.00Switzerland March, 1946 146 million Swiss francs 34.00Norway August, 1945 11 million US dollars 11.00
December, 1946 90 million Norwegian kroner 22.00Germany - SovietZone February, 1946 20.5 million US dollars 20.50
Bulgaria April, 1946 14 million US dollars 14.00Holland December, 1946 45 million Dutch florins 17.00Hungary October, 1946 1.26 million US dollars 1.26Czechoslovakia May, 1945 5,4 million US dollars 5.40
April, 1946 68 million US dollars 68.00Austria September, 1946 7.27 million US dollars 7,27Jugoslavia January 1# 1946 2.5 million US dollars 2.50
August, 1946 4.0 million US dollars 4.00Belgimn August, 1946 6 million US dollars 6.00Finland Julys 1946 3.4 million US dollars 3,40Iceland December, 1946 1.75 million US dollars 2.00
TOTAL 894.33
Source: Polish Ministry of Navigation and Foreign Trade,War sawv
/ Excluding the agreement of August 16th, 1945, with the U.S.S.R.regarding reparations. These agreements include only thosesigned up to the end of December 1946. Since that date thefollowing agreements have been signed:1. Soviet Zone of Germany, February, 1947, Imports 7.15 million
dollars, Exports 7*01 million dollars2. Finland, March, 1947, Exports 495 thousand tons coal* equi-
valent imports.3. Czechoslovakia, March, 1947, 200-300 million dollars imports
and equivalent exports over a five year period.4. Norway, February, 1947, Imports 66.32 million Norwegian
kroner, exports 44.94 million Norwegian kcroner, Good credit4 million kroner.
5. Uolland, February, 1947, Imports 155 million Dutch florins ,exports 155 million Duteh florinso
-49 -
Since transport difficulties are one of the main bottlenecks
in Polish foreign trade, special transport provisions are in-
cluded in many of the new agreements. Goods exchanged with the
U.S.S.R. are mainly carried by Soviet trains on the broad gauge;
Sweden has sent Poland some railway trucks and locomotives and
has recently organized communications by ferry; finally Switzer-
land and some of the Balkan countries have undertaken to carry
all goods exchanged in their own railwray freight cars.
The conduct of foreign trade through trade agreements must
be regarded as a necessity arising out of the special circum-
stances existing at the end of the war. At the same time consid-
erable trade has been carried on outside the trade agreements,
and this should grow progressively as economic conditions
throughout the viorld recover. VVhile it is clear that trade
agreements will continue to be an important feature of Polish
foreign trade, particularly in her commercial relations with
other planned economies, in the long run normal trading will
occupy a much more important position.
Appendix I summarizes the nature of the trade under each
agreement and its approximate value.
Prices and Vaelues
In analyzing the revival of Poland's foreign trade in the
immediate postwar period, one of the major difficulties is the
correct assessment of its value. In the official valuation supp-
lied by the Polish Government import and export values are ex-
pressed in postwar zlotys. This valuation represents the amounts,
in zlotys, received by the exporter or paid by the importer.
The export prices represent the current prices fixed by the
Ministry of Industry for industrial products and by the Ministry
- 50 -
of Navigation and Foreign Trade in agreement with the exporter
for other products. The price in zlotys of imported commodities
is determined by the Economic Committee, which works on the
principle that the price should correspond to the price prevailing
on the internal controlled market. An over-riding principle is
that, taken. together, the value of imports in zlotys should equal
the amount paid to exporters. In general, therefore, the zloty
values of imports and exports are made to conform with the price
structure of the controlled sector of the Polish economy, where
much lower prices and wages prevail than in the free market
sector.
To be comparable writh prewar or other trade data trade
statistics must be converted into dollars or pounds in such a
way as to express the true exchange value of the commodities
concerned. Neither the official rates of exchange between the
Polish and other currencies (100 zlotys 3 1 dollar) nor the black
market prices of the latter (which have, on occasion, reached
1,000 zlotys per dollar), however, provide a completely satis-
factory basis of comparison. Moreover, Poland was cut off so
effectively from the outside world for so many years that both
the general level of prices (if such a concept has any meaning
in an economy where some prices are fixed and others uncontrolled)
and the price relationships of different goods one to another
are quite unconnected with price levels and price relationships
in the world market.
To illustrate the problem we may consider coal exports,
which, in zloty value, accounted for 48 percent of all exports
in 1946. A total of 8.69 million tons was exported, valued at
only 5,115 million zloty. The average price of a ton of coal, in
- 51 -
Polish Government statistics, is thus about 590 zloty per ton.
The world market price is about ten dollars per ton. Thus the
rate of exchange for Polish coal is about 59 zloty per dollar.
In the case of other exports the exchange rate is about 140 zloty
per dollar. In the following analysis of Poland's foreign trade
since liberation, whenever possible comparisons are made on the
basis of zloty values, since this eliminates the problem of a
true exchange rate. In other cases comparisons are made on the
basis of world dollar values of the goods entering into the
foreign trade.
Trade in 1945 and 1946
IJNRRA supplies to Poland were specifically for relief and
rehabilitation and were designed to assist the country to resume
its normal economic life. They were not of the same character as
other imports and should not, therefore, be considered in any
discussion of Poland's progress in re-establishing normal foreign
trade. In order to examine the development, during 1945 and
1946, of Polandts postwrar pattersn of foreign trade, we will, for
the moment, disregard UNTRRA imports.
It should be borne in mind, vwhen considering postwar
recovery, that the prewar basis used in the following analysis is
given merely for purposes of comparison and that, as a result of
territorial changes, Polish imports and exports should, in the
long run, far exceed prewuar levels. In 1937 and 1938 exports (at
prices ruling in those years) amounted to some 225 million doll-
ars, wqhile imports totalled some 241 million dollars. The follow-
ing table shows progress in 1945 and 1946 towards overtaking this
prewar level. Although the figures are approximations, they
indicate the order of magnitude of the trade Poland has been able
- 52 -
to transact vwith other countries during the first two years
following liberation. It is clear that, imports and exports
within trade agreements approximately balance; the determining
factor in these imports so far has been the extent of exports.
In 1945 exports were on a very low level and reached only some
ten percent of prewar levels. Even if we exclude exports of
food, which were impossible immediately after the war, exports
rere only some 14 percent of the prewar level. In 1946, however,
rehabilitation was progressing at a much faster piace and exports
expanded to some three and a quarter times the 1945 level,
reaching about one third of the prewar level. Excluding food,
the percentage was 45 percent. If the 5.5 million tons exported
to Russia under the trade agreement of August 16th, 1945, are
included, exports were about 180 million dollars in 1946, about
45 percent higher than the figures quoted below and nearly half
of prewar exports.
TABLE XI
Polish Foreign Trade in 1945 and 1946 1/
(in million U.S. dollars at 1946 prices)
1937/38average 1945 1946
Exports 375 38 126
Importsnormal trade 400 34 139
UNRRA imports - 92 306
Other imports / 38
Total 400 126 483
1/ These statistics exclude coal exports to Soviet Russiaspecified in the trade agreement concluded on August 16th,1945 because such exports are part of the reparationssettlement betwreen Poland and Russia. Poland was to
(Footnotep continued next page)
- 53 -
deliver eight million tons of coal in 1946 (valuedat about 80 million dollars), but actually only 5.5million tons were so delivered, valued at about 55million dollars.
2/ Reparations and imports financed from the creditsraised in the United States. which together total38 million dollars.
Source: UNRRA Mission to Poland
For 1947 prospects are much brighter; it is estimated that exports
will rise to some 298 million dollars, which represents an in-
crease of 135 percent above the 1946 level. This level of ex-
ports is 80 percent of the prewar volume. Exports other than
food will be about ten percent greater than prewar levels, This
rapid revival to prewar levels of export will be achieved largely
by an expansion of coal exports to 20 million tons, which alone
will account for two-thirds of the total value of exports.
Owling to the termination of UNRRA activities during 1947,
imports will depend upon Poland's success in obtaining credits
from abroad, but assuming she is successful in this aim her im-
ports should greatly exceed exports this year. Assuming the
0 economic plan is achieved, imports will amount to 510 million
dollars, an excess of 212 million dollars over exports, and 27
percent higher than prewar. By 1949 imports will be over 90 per-
cent greater than before the war, while exports will be about
30 percent higher. On a per capita basis imports will be 180
percent greater and exports 90 percent greater.
Table XIII shows the development of trade in 1945 and 1946
according to countries. This shows the preponderance in Poland's
trade (excluding UNRRA imports) of the U.S.S.R. In 1945 the
U S.S.R. accounted for 93 percent and in 1946 for 57 percent of
the total trade turnover. At the same time the Scandinavian
countries are increasing relatively in importance, their share
- 54 -
increasing from seven percent in 1945 to 21 percent in 1946. Of
this most of the trade is with Sweden. The table shows clearly
how trade has expanded in 1946 to include the Balkans, Czechoslo-
vakia5 France and Switzerland. Trade with the United Kingdom and
the United States is developing only slowly, due to the fact that
these two countries have not as yet entered into trade agreements
with Poland. However, it should not be forgotten that Poland was
able to obtain supplies from these two countries, including in-
dustrial raw materials and equipment, through the UNRRA program.
An interesting feature of Poland's foreign trade is the
fact that she is building up credits in many countries. During
1946. although her imports slightly exceeded her exports by 845
thousand zlotys, or eight percent, at the same time she built up
debit and credit balances as follows:-
TABLE XII
Excess of Imports over Exports Excess of Exports over Imports(in thousand zlotys)
U.S.S.R. 1,880 Sweden 666Zone of Germany 262 France 386
Czechoslovakia 331 Denmark 295Hungary 156 Norway 211United States 126 United Kingdom 177Rumania 80 Switzerland 110
Source: Ministry of Navigation & Foreign Trade,Warsaw.
Her greatest debit balances are with the U.S.S.R., Czechoslovakia
and the Soviet Zone of Germany.
During 1946 imports from the U.S.S.R. exceeded exports by
nearly 40 million dollars, though it should not be overlooked
that this ignores the 55 million dollars exports in the form of
coal under the August 1945 agreement. Taking all other countries
together, exports exceeded imports by some 25 million dollars or
about one percent of the Polish National Income. This was
- 55 -
Poland's contribution in 1946, to the rehabilitation of Europe.
In the latter months of 1946 the excess of exports over imports
to these countries was even greater and amounted to two percent
of the national income.
TABLE XIII
Polish Foreign Trade in 1945 and 1946
(in million zlotys)
I m p o r t s E x po r t sCountry 1945 1946 1945 1946
U.S.S.R. 1,580 7,271 1,8840 5,392
U.S.S.R. Zone of Germany - 816 - 554
Scandinavia: 167 1,742 85 2,954of wprhich: Sweden (99 (1,356) (7) (2022
Denmark (311 (261) (41 (556)
Balkans: 1 521 8 284of which Hungary 1 (261) (6) (104)
Czechoslovakia - 718 - 387
France _- - 387
Switzerland - 150 - 260
United Kingdom - 88 - 265.
United States - 162 - 35
Other countries - 75 - 112
Bunkers - - - 69
TOTAL 1,748 11,544 1,933 10,699
Source: Ministry of Navigation & Foreign Trade, WNarsaw
- 56 -
TABLE XIV
Poland's Imports in 1945 and 1946
In Thousand Tons In Million Zloty1945 1946 19)45 1946
Food, Drink and Tobacco 34 548 477 4,881of vwhich: Grain and
Pulses (29) (490) (133) (3,119)
Fertilizers 15 137 12 411
Raw Materials: 214 1,176 821 2 947of which: Iron Ore (233) (980) (57) 21
Scrap Iron (-) (10 (-) (151Manganese &Chrome Ore (36) (52) (36) (73)
Non-ferrousmetals (0.5) 2) (113) (222Rubber (0.3) 2) (17) (308)Wo ool ) 1) ) (358) (81)Cotton ) (19) (37) ) (1,446
Oil &. Petroleum Products 36 190 2/ 218 1,526
Manufactured Products 15 4 231 699
Miscellaneous 2 11 1,080
TOTAL 416 2/ 2,066 1,747 11,544
1/ Not including machines
2/ Not including 184 thousand cubic meters of natural gas
Source: Ministry of Navigation and Foreign Trade,Warsaw.
- 57 -
TABLE XV
Poland's Exports in 1945 and 1946 /
In Thousand Tons In Million Zloty1945 1946 1945 1946
Coal and Coke 3,629 8,690 1,21499 5,115
H " t "By-products - 45 - 297
Electric Current - - 355
Raaw Materials: 101 496 288 1,771of which: Iron & Steel (30) (78) (189) (658)
Zinc & Zincproducts (8) (35) (56) (546)
Lead (- (4) (-) (70)* Cement (55 (379) (36) (379)
Manufactured products: - 68 496 2,280of whi6h: Textiles - 50 (452) (2 1073
Glass Products - (8 (8) (172)
Food - 10 - 693of wrhich: Sugar - (9) - (670)
Miscellaneous 11 - 188
TOTAL 3,730 2/ 9,320 1,933 10,699
1/ Excluding deliveries to the U.S.S.IR. under the agreementdated August 16th, 1945.
* 2/ Not including textiles and glass products.
Source: Ministry of Navigation & Foreign Trade, Warsaw.
In Tables XIV and XV the foreign trade of Poland is broken down
according to the main commodities entering into it. Amongst
her imports food, drink and tobacco, which accounted for 42 per-
cent in 1946, occupy the first place, with raw materials second
and petroleum products third. Food showed a great expansion in
1946 and should continue to play an important part in 1947, but
apart from tropical foods, slMuld disappear in 1948. Amongst
raw materials, the most important by value are cotton, iron ore,
rubber and non-ferrous metals.
Table XV shows the importance of coal and coke in exports;
- 58 -
though their relative importance is decreasing as industry is
rehabilitated they expanded by more than 250 percent in 1946.
In 1945 they accounted for some 75 percent, and in 1946 for 48
percent of exports. Exports of other raw materials have expanded
even more rapidly as industry has been rehabilitated, zinc and
zinc products, lead and cement being the main items. 21 percent
of total exports are accounted for by manufactured products.
Food was exported on a very small scale and was almost entirely
accounted for by exports of sugar. It should be noted that this
table excludes the delivery of 5.5 million tons of coal, valued
at about 3,250 million zloty, to the U.S.S.R. under the agreement
of August 16th 1945.
Table XVI compares the principal imports and exports before
and after the war, including only those obtained through normal
foreign trade and excluding the large UNRRA imports. It is clear
that imports of textiles are much lower than before the war;
imports of raw cotton, for example, are less than half of prewar
levels, and imports of raw wool, hides and skins, less than five
percent of prewar. Owing to the large quantities of scrap iron
available within the country the large prewar imports of scrap
iron have, as yet, hardly been resumed. On the other hand,
imports of iron ore and manganese and chrome ore are running at
a level about 15 percent above prewar, and imports of petroleum
products, due to the loss of domestic resources, are also on a
much higher scale. In the export field normal exports of coal
and coke are now running about 75 percent of prewar although if
5.5 million tons delivered to the U.S.S.R. under the trade agree-
ment of August 16th, 1945, are included, they are 25 percent
above prewar levels. Exports of iron and steel products, how-
- 59 -
ever, are less than one-third of the prewar level and exports
of zinc and zinc products about one half. Cement exports
greatly exceed prewar levels as do exports of textiles, which
are seven times the prewar volume. The biggest single loss in
exports is in food; only some ten thousand tons were exported
in 1946 compared with over 600 thousand tons before the war.
TABLE XVI
Polish Imports and Exports Pre and Postwar
(in thousand tons)
1937/38average 1945 1946
Imports
Raw Cotton 79 ) 37Rawr Wlool 25 ) 1Raw Hides and Skins 29 1Scrap Iron 535 - 10Iron Ore 658 233 980Manganese and Chrome Ore 78 -5 52Petroleum Products - 36 190
Exports
* Coal and Coke 11,333 3,629 8,690Iron, Steel, and Products 266 30 79Zinc and Zinc Products 69 8 35Lead 0.16 - 4Cement 37 55 379Textiles 7 _ 50Food 604 10
1/ Excluding 5,5 million tons delivered to the U.S.S.R. underthe trade agreement of August 16th, 1945.
Source: Concise Statistical Year-Book of Poland, London1944, and Ministry of Navigation & ForeignTrade, Warsaw.
- 60 -
Foreign Trade & UNR1A Imports
Poland has re-established her normal foreign trade to a
considerable extent during the first two postwar years. We have
seen;, however, that these imports consist predominantly of in-
dustrial raw materials, vwith very small quantities of foodstuffs,
other consumer goods and the necessary capital equipment for the
reconstruction and re-equipment of the country's agriculture and
industry. Because of the greatly inflated needs following the
waitime devastation in Poland, imports through normal channels,
aithough equal to about half of the prewrar volume, would have
been completely inadequate to enable Poland to feed her populat-
ion and commence the rehabilitation of her agriculture and
industry.
This vital gap in Poland's import needs was filled by UNRRA,
which brought in large quantities of food, olothing, and medical
supplies for the immediate relief of the Polish people and in-
dustrial and agricultural rehabilitation supplies to help rebuild
their shattered farms and industries. -Table XVII describes the
UNRRA program in detail.
As this table shows, food accounted for 42 percent of the
total program. A further nine percent represented clothing and
another 5%- percent represented medical supplies. Thus 271.5
million dollars, or about 55 percent of the total program, con-
sisted of relief items which in normal years would not be of much
importance in Poland's total imports. The remainder of the pro-
gram, some 210 million dollars, represents imports which were
vital for Poland's agricultural and industrial rehabilitation.
This 210 million dollars wras divided almost equally between
transport (65 million dollars), industry (69 million dollars)
- 61 -
and agricultural rehabilitation (76 million dollars).
After liberation Poland needed food, clothing, means of
transport and industrial equipment at once. Even if these
imports had been available from other than UNRRA sources, which
is doubtful, Poland could not have waited until it had sufficient
foreign exchange to pay for them. Any delay would have caused
widespread starvation and would have prevented the re-establish-
ment of transport and of agricultural and industrial production.
The timing of UNRRA imports into Poland is set out in
Table XVIII in order to show the emphasis on relief items in the
early stages of the program, and the subsequent emphasis on
agricultural and industrial rehabilitation supplies.
- 62-
TABLE XVII
UNRRRA Frogram of Operations for Poland
(estimated values in thousands of U.S. dollars)
Food Value Clothing and Textiles Value
Grain and Grain Products 34,370 Finished Clothing 22,300Meat & Meat Products 35,260 Blankets and Comforters 2,440Fish 13,090 Cotton Textiles 1,380Dairy Products 29,840 Woolen Textiles 10,290Fats, oils and soap 29,340. Cotton Yarn 40Sugar 230 Woolen Yarn 1,130Pulses 2,540 Raw Cotton 14,490Vegetables 200 Ravw Wool 18,040Beverages 4,360 Footwear 7,470Fruits and Fruit Produots 1,010 Upper Leather 800Soup Dehydrated 3,360 Sole Leather 1,150QM Food 28,800 Hides 440Other Food 730 Miscellaneous Textiles 1,090Animal Feeds 360 Miiscellaneous Footwear 840Red Cross Packages 2,320 MaterialsMIilitary Surpluses 1,190 Unclassified 800Unclassified & Unprogramed 14,520
TOTAL 201,520 82,700Medical Supplies 25,800
Agricultural Rehabilitation
Bagging 2,140 Transport & Telecoomunioations 58$280Farm Machinery 14,860 Public Utilities 2,920Fertilizer 5,400 Building Repair Equipment 2,820Fishing Equipment 4,800 Mining and Quarrying 7X170Food Processing Equipment 360 Machine Repair 4,900Livestock 31,400 Fuels and lubrioants 7,590Pesticides 160 Processing Equipment 1,040Repair Materials & Rand Tls 1,310 Materials Chemicals andSeeds 10,960 Engineering Stores 9,660Dairy & Poultry Equipment 1,450 Unclassified 960Veterinary Supplies and
Harness 2,520 TOTAL 95,340Agricultural Education 540
75,900
Grand Total 481,260 dollars
Source: Operational Reports, UNRRA Bureau of Supply, Washington.
- 63 -
TABLE XVIII
UNPRA Programs and other Imports 1947-1949
In Million U,S. IDollars
Year 19461945 lst End 3rd 4th 1946
Qtr. Qtr. Qtr. Qtr. Total 1947UNRRA Supplies - -
Food 29,9 24.0 57.0 42.0 14.0 137.0 34,6Clothing & Textiles 32.5 23.4 19.8. 1.2 4.6 49,0 1,2Medical Supplies 8.7 5.6 0.7 0.3 0.4 7.0 10.1Agricultural
Rehabilitation 8.4 8.0 21.7 18.5 6.8 55.0 12.5Industrial "
(inol. Transport) 12.4 16.5 23.0 10.5 8.0 58.0 25.0
TOTAL 91.9 77.5 122.2 72.5 33.8 306.0 83.4
Other Imports 1/ 34.1 16.9 37.4 39.5 45.0 138.8 430.6Total Iaports 1/ 126.0 94.4 159.6 112.0 78.8 444.8 514.0Percent of all
Imports suppliedby UIRRA 73 82 76 65 43 69 16
1/ Exoluding reparations and imports'financed from U.S. Creditstotalling 3U million dollars.
Source: Ministry of iKtavigation & Foreign Trade, Warsaw, and U1U?A-= ~. Mission to Poland
The above table indicates that, in the year 1945, in spite of a
late start - the agreement with Poland was only signed on
September 14th, 1945 - TJNRRA supplied three-quarters of the total
imports arriving in Poland during the whole of that year. Food,
clothing, medical supplies and transport equipment formed the
bulk of the supplies in this early period. In subsequent months
UNRRA imports expanded in volume, reaching their peak importance
in the first quarter of 1946, when they totalled 77.5 million
dollars and accounted for 82 percent of the total imports. The
peak deliveries were made in the second quarter when 122 million
dollars were imported. During the whole of 1946 UNRRA imports
totalled 306 million dollars and accounted for 70 percent of the
- 64 -
total imports delivered in Poland that year. The amount of the
UNRRA program which remains to be completed in 1947 is 83.4
million dollars. Of this, 34.6 million dollars is in the form of
food. a figure which has been increased to the fullest extent
during the first months of 1947 in order to help meet the food
crisis which is bound to develop during the spring and summer
months. Another 37.5 million dollars represents agricultural and
industrial rehabilitation supplies, whose delivery has been de-
layed on account of procurement and manufacturing difficulties.
*10 million dollars will be in the form of medical supplies, a
program which has also been delayed through procurement diffi-
culties.
During the year 1947 UNRRA's importance will diminish
greatly, in this year, if the import program is realized, UNRRA
supplies will represent only one sixth of the total imports.
Having described UNRRA's contribution to Poland's foreign
trade during 1945 to 1947, we may now take into account both
normal trade turnover and UNRRA imports and compare Poland's
imports with those of prewar years. At present prices prewar
imports were running at about 400 million dollars per annum. As
may be seen from the above table, total imports in 1945, in spite
of the devastated condition of the country and the urgent need
for imports amounted to only 126 million dollars, less than one-
third of the prewar level. In 1946, however, the total imports
from all sources were 483 million dollars, some 20 percent
greater than in prewar years; nevertheless this level of imports
was sufficient only to maintain a bare subsistence level of
nutrition and was far below the import requirements necessary for
rapid industrial and agricultural rehabilitation. It is inter-
- 65
esting to note that, in the year 19475 the new import program
draim up by the Polish Government represents only a six percent
increase over the level of imports actually achieved in 1946, in
spite of the fact that industrial and agricultural rehabilitation
is noW expanding rapidly. In this year the sharp reduction in
UNRRA supplies from 306 to 83 million dollars will have to be
made up by imports paid for from other sources.
Summing Up
In summing up this brief analysis of Poland's postwar
foreign trade, the following points may be made:
1) Territorial changes and the economic plan of recon-
struction call for imports on a considerably larger
scale than before the war during the next three
years. Furthermore, they mean that in the long
run imports and exports of postwar Poland will be
greatly in excess of prewar levels.
2) Poland's foreign trade relations are reviving
rapidly. If calculated on a per capita basis,
the value of Poland's annual trade turnover,
excluding UNRRA supplies, is now 50 percent of
the prewar level Which, however, was low.
3) Poland's foreign trade has become less one-sided.
Trade relations are being established with a
number of countries and commodities exchanged
are becoming more varied.
4) Commercial (that is, non-UNRRA) imports show a
high proportion of raw materials; this paitly
results from the fact this type of commodity is
available in the countries with which trade
- 66 -
relations have been established thus far.
5) Foreign trade so far is based mainly on barter,
and with the exception of the trade agreement with
Sweden does not provide Poland with any free
currency which could be used for imports from
elsewhere.
6) UNRRA thus far has played the predominant role
in Poland's imports by providing the major part
of them, by supplying goods not available under
existing trade agreements, by furnishing supplies
free of charge, and by delivering them at a consid-
erably faster rate than would have been possible
through ordinary commercial channels.
V. POLAND'S TRADE PROSPECTS FOR 1947-49
It has already been explained, in an earlier chapter, that
wartime destruction in Poland was on so vast a scale that, even
if all the necessary materials and equipment were freely avail-
able, it would take years of unremitting labour to replace what
has been destroyed. Unfortunately, even after the UNRRA program
in Poland, resources within the country at the beginning of 1947
are inadequate to provide the materials and equipment required.
Both agriculture and industry require extensive capital invest-
ment during the next four or five years. According to the
Provisional National Economic Plan, now in process of revision,
a total gross investment of 3,150 million dollars will be made
in the three years 1947 to 1949. Of this, investment from
current production will provide only about 76 percent of the
total investment required, the remaining 24 percent, or some 770
million dollars, being necessary net investment from abroad, i.e.
- 67 -
an excess of imports over exports. It is important to realize
that Polish production assumed in the Plan depends upon these
overseas investments; any short-fall in the 24 percent would,
because of the normal high rate of depreciation of existing
capital, have a greatly magnified effect on net investment, and
production levels would be very adversely affected.
Foreign Trade 1946 to 1949
The following table describes the foreign trade required by
the Polish Government Four Year NTational Economic Plan. Estim-
ates of exports are based on the assumption that necessary im-
ports are obtained in each year. Failure in any year to obtain
these imports would, by reducing production, involve a reduction
in exports the following year and, therefore, a net increase in
the total imports required during the whole four years if the
Plan is to be achieved. In connection with this table, it should
be noted that prices are based on quotations in June or July
1946, and do not take into account recent price increases.
This table shows that imports required for current produc-
tion fluctuate around 350 million dollars per annum. However,
within this group requirements for food are reduced rapidly to
negligible proportions, while those for raw materials and inter-
mediate products for industry expand from 223 million dollars in
1937 to 350 million dollars in 1949, increasing with Polish in-
dustrial recovery. Exports revive rapidly from 298 million
dollars in 1947 to 485 million dollars in 1949. Thus while, in
1947, there is a deficit of 68 million dollars in exports com-
pared with the imports necessary for current production, this
becomes a surplus in the following year, and in 1949 there is a
surplus Qf 125 million dollars. Import requirements for invest-
- 68 j
ment goods increase very rapidly during the three years from 148
million dollars in 1947 to 415 million dollars in 1949. This is
partly due to the fact that, on account of the difficulties of
matching available exports with required imports of investment
goods through barter agreements with individual countries,
certain investment imports not required for the Plan will be
brought in. These additional investment imports rise from 30
million dollars in 1947 to 100 million in 1949 and almost elimin-
ate the surpluses in 1948 and 1949 which would otherwise have
been available for essential investment imports. Imports of
esssntial capital equipment, which are thus not covered by ex-
ports, amount to 275 million dollars in 1948 and 315 million
dollars in 1949. In total the deficit over the three years is
slightly greater than the essential capital investment and is
771 million dollars.
0
- 69 -
TABLE XIX
Polish Imports and Exports, 1946 - 1949(in Million U.S. Dollars)
All figures expressed on an F.O.B. basis
1946 1947 1948 1949
Imports required forcurrent production
Food 195 136 20 10Other consumption goods 30 7 - -Raw materials and inter-
mediate produots 110. 223 300 350
Total 335 366 320 360Exoorts 126 298 1400 485
Surplus available forinvestment imports -209 - 68 + 80 + 125
Required imports of investmentgoods:
Essential capital equip-ment n.a. 118 275 315
Other investment goodsderived from tradeagreements n.a. 30 70 100
Total 148 148 345 415
* Deficit 357 216 265 290
Source: Polish National Economic Plan (ProvisionalFigures), 1946 and UNRRA Mission to Poland
Imports and Exports in 1947
In many ways 1947 is a critical year for the Polish economy.
In this year there is still the need for food imports on a con-
siderable scale, which must have first priority. Furthermore,
since production in the years 1948 and 1949 will depend upon
success in laying the foundations of expansion in 1947, the im-
portance of fulfilling the investment plan during this year
cannot be stressed too highly. Although an exact analysis is
impossible, it is fairly certain that, due to the devastated
- 70 -
condition of Polish industry, the amount of investment available
from current production would hardly cover depreciation of cap-
ital during the year, and, unless the import program is realized,
instead of expanding rapidly as envisaged in the Plan, the Polish
economy would expand little, if at all. Moreoever, since the
plan has left certain fields of production to be built up with
imported equipment, failure to obtain this equipment would have
widespread repercussions and disrupt production seriously.
In Tables XX and XXI the required imports and the estimated
surplus of indigenous production available for export in 1947
are given in detail.
TABLE XX
Estimates of Poland's Import Requirements in 1947(in million dollars)
Description Value
FoodstuffsCereals 36.5Pulses 3.1Milk 18Meat 43Fish 9Fats 23.25Other Foods 3.15
Total 136
Raw MaterialsCotton 327Tr o 1 35Fibres 20Leather 11Rubber 57food Pulp (for paper industry) 5Ores: ferrous and non-ferrous metals 35Petroleum products 20Chemical raw materials 4oTanning materials 2Greases 5Timber (Railway ties, props etc.) 3Miscellaneous 10
Total 223(Table XX continued on next page)
- 71 -
TABLE XX(Cont'd.)
Estimates of Poland's Import Requirements in 1947(in million dollars)
Description Value
Agricultural SuppliesHorses 22,5CoWers NilBreeding livestock 2Veterinarian equipment, etc. 2Agricultural installations 2Tractors and machines 7.5Inland-water fishing equipment 1Laboratory equipment 1Other tools and machines Nil
Total 38
Essential Capital EquipmentElectric power 10Machine tools 10Industrial and agricultural machines 20Transport installations 10Telecommunications equipment 5Port equipment 15Construction equipment 10
Total 80
Non-essential Capital Equipment 30
* Miscellaneous Consumer Goods 7
GRAND TOTAL 514
Source: UNRRA Mission to Poland
- 72 -
TABLE XXI
Poland's Estimated Exports in 1947(in million dollars)
Coal (20,000,000 tons) 200Non-ferrous metals 12Iron and steel 20Textiles 21Cement, glass, chemicals 25Wood products, feathers, bristles, herbs,
handicraft products 20
Total 298
Source: Polish Government memorandum to the U.N.Temp. Sub-Commission on the EconomicReconstruction of Devastated Areas,TLondon, 1946.
As far as food is concerned the Polish Government is planning
on achieving an average daily intake of 2,131 calories for the
agricultural population and 2,059 calories for the non-farm
population at the retail level in the food year 1946/47 2/ This
is an increase.over the level of consumption in the previous
food year which was 1,680 calories per head per day. After the
hardships of the Polish population during the war this increase
in fPood consumption is considered essential. On this basis it is
estimated that there is a deficit of 848 thousand tons of grain
for consumption alone, to which should be added a requirement of
175 thousand tons representing the necessary increase in stocks
of grain for distribution, bringing the total to 1,023,000 tons.
1/ See Operational Analysis paper No. Agriculture and Food in-Poland, European Regional Office, UNERA, London. In arrivingat the caloric totals, the oalories equivalent of the variousfoods have been based on Polish conversion tables.
- 73 -
It is estimated that, during the calendar year 1947, import re-
quirements will amount to only 560 thousand tons of grain, 45
thousand tons of which will be required for minimum stocks. On
the basis of this food import plan, the intake of the non-farm
population will be equal to only two-thirds of the corresponding
group in the United Kingdom and, though higher than last year,
will still be below the level of emergency subsistence food con-
sumption set by the nutrition committee of the Food and Agricul-
ture Organization of the United Nations. -b, a level which
cannot be long maintained without causing serious ill-health. It
is clear,,'therefore, that Poland's import requirements for food
could scarcely be reduced.
The figure of 38 million dollars for agriculture is largely
for the purchase of 60 thousand horses (22.5 million dollars),
which would be only a small proportion of the total number lost
(1,744 ,00) during the war. These are important not only for
draft power, but for their contribution to the fertilizer prob-
lem. A further item included beoause of the urgent need of
increasing tractive power on farms, and thus increasing agricul-
tural output in Poland, is that of 7.5 million dollars to be ex-
pended for agricultural tractors and machines. These investments
in agriculture are vital if the country is to be self-sufficient
in the year 1948.
Minimum requirements of rawrv materials include 87 million
dollars for the purchase of cotton, wool and other fabrics - an
2/ For European countries this is defined as an average dailyintake of 1,900 calories, requiring a national average supplyof no less than 2,,200 calories at the retail level.
- 74 -
expenditure of 3.5 dollars per capita. This is a low figure in
view of the acute lack of clothing, and Poland's cold climate,
the more so because some of these materials are re-exported in
finished form. Although the value of these materials is higher
than in prevwar years the quantities are approximately the same.
20 million dollars for liquid fuel, 5 million for rubber, are
essential to transport and industry. The remaining raw miaterials
for industry amount to 111 million dollars and seem reasonable
in view of Poland's rapidly expanding industrial capacity which
will involve not only increases in consumption but increases in
0 essential stocks thiroughout the country.
The total requirements of 80 million dollars for capital
equipment are modest. It is obvious that ten million dollars
for machine tools and 20 million for industrial and agricultural
machines are small In view of the tremendous war damage to in-
dustry and transport V1. Finally, ten million dollars for trans-
port installations, ten million for electrical utilities, 15
million dollars for port equipment and ten million dollars for
construction equipment are to be expected because of the destruc-
tion in these fields.
The estimates of exports are maxima, and since they are
based on the most favorable estimates of labor, transport avail-
ability, and spare parts, it is more than probable that at least
some of them will not be met.
The coal figure requires a word of explanation, during 1946
a total of 47.3 million tons of coal was produced, of which 5.5
1/ See page 4, also Operational Analysis Papers Nos. andIndustrial Rehabilitation in Poland and Transport Rehabilitat-ion in Poland. European Regional Office, UNRRA, London.
- 75 -
million tons vwas delivered to the Soviet Union as part of the
reparations settlement effected between the two countries and
8.7 million tons exported under trade agreements. In 1947 it is
expected that production will increase to 60 million tons. l, and
exports to 20 million tons. Requirements for domestic consump-
tion thus increase from 33.1 million tons in 1947 to 40 million
tons. Because of the likelihood of even higher domestic consump-
tion and the bottlenecks of transport and loading equipment, coal
export estimates appear to be optimistic.
Increased resources in non-ferrous metals, iron and steel,
and certain chemicals, will enable Poland to export more of
these commodities than in prewar years, and obtain 57 million
dollars from these exports. Extensive textile manufacturing
equipment acquired in the western territories will also make it
possible to export textiles to the value of 21 million dollars.
The total excess of required imports over estimated exports
is 216 million dollars.
The above figures are provisional. Revised estimates of
Poland's export possibilities in 1947 show about 55 million
dollars derived from textile exports and about 24 million dollars
from exports of sugar. On the other hand, exports of iron and
steel and non-ferrous metals will probably be considerably lower
than the figures above. Owing to these changes, the total value
of exports might be in the neighborhood of 340 million dollars.
There wrtill, however, also be changes in the import figures.
1/ This is contingent upon the Installation of imported coalmining machinery and equipment.
- 76 -
The Balance of Payments in 1947
The total excess of imports over exports given above is on
an F.O.B. basis; it does not take account of any "invisible"
items which must be included in order to measure the full extent
of the excess of Poland's expenditure abroad over her expected
receipts from abroad in 1947. The following "invisible" expen-
ditures must be added to the excess:
a. On account of the world shortage of certain manu-
tured capital goods, and the great competition in
placing orders with manufacturers, payments on
account must be made when ordering investment
goods. In 1947 when the bulk of the orders must
be placed, such payments on account are estimated
at 30 million dollars.
b: Transportation and insurance charges by foreigners
involved in the import of investment goods amount
to 30 million dollars.
Lc. Similar additional costs for food imports are
estimated at 35 million dollars.
d. The required imports were estimated on the assumption
that surplus property material and rolling stock
were already provided for by credits from the
U.S.A. The gross import requirements should,
therefore, be increased by 60 million dollars,
the differenice between the total credits of 90
million dollars which are available and the actual
expenditure of 30 million dollars during 1946.
e. Finally, it is estimated that financial and ad-
ministrative expenses abroad, in connection with
- 77 -
all imports, will amount to 40 million dollars.
The total of these additional expenditures is 195 million
dollars, which would, if there were no offsetting items, bring
the adverse balance to 411 million dollars. Poland's foreign
4trade problem in 1947 is thus resolved into finding the means of
financing this deficit of 411 million dollars.
iTAe will examine in turn the various sources of finance
available. The most obvious means of financing the deficit is
the utilization of any gold and foreign exchange available, but
in Pcland's case it is impossille to finance any of the deficit
in this way. At the end of the war Poland had approximately 71
million dollars' worth of gold and foreign exchange. Although
the United States recently unfroze all Polish blocked accounts
in the United States, valued at ten million dollars, some of the
gold and foreign exchange has been used and today the total re-
mains at alout 70 million, of wrhich 12 million, however, have
heen earmarked in settlement of any debts to the United Kingdom.
* ? Thus, Poland is left with only about 58 million dollars of liquid
assets abroad. This, however, cannot be used for buying imports.
Poland has several commitments to international institutions;
her contribution to the International Monetary Fund and the
International BEnk is 25 million dollars, and she has to pay 307
thousand dollars per annum to the United Nations, 36 thousand
dollars to the European Coal Organization, 40 thousand to
E.C.I.T.O. and 52,400 to the F.A.0. As other international in-
stitutions such as the projected International Trade Organization,
are formed other drains will be made on the available gold and
foreign exchange.
- 78 -
Another fact to be borne in mind is that, although before
the war, in 1937, Poland's foreign assets in the form of bonds,
letters of credit, stocks and shares, cash credits, etc. amounted
to about 70 million dollars, liabilities of the same nature
amounted to about 1,300 million dollars. It should be stressed
that these heavy liabilities abroad still exist, in spite of the
nationalization of large sectors of Polish industry. Although
Poland can, because of the adverse trade balance, make no pro-
vision at present for the indemnification of foreign investors,
the Government has stated its definite intention of making re-
payments in the long run.
In examining Poland's ability to pay for relief and rehab-
ilitation supplies the appropriate UNRRA council committee de-
cided that the country's gold and foreign exchange holdings at
the end of the war were below the minimum necessary for the
sta'oilization of Poland's currency and the fulfillment of her
international obligations. Obviously, the position is no differ-
ent now than at the end of the war; very little of the deficit
can be financed from these holdings.
The second possible source of financing the deficit is the
UNRRA program. Of the total UNRRA program of 481.3 million
dollars only 397.9 million dollars had been delivered in Poland
by the end of 1946. There is available, therefore, some 83
million dollars of further UNRRA supplies in 1947, most of which
will be delivered by the 31st March.
Of this, however, 10 million dollars are for medical supp-
lies which ca'not be counted against the deficit; the UNRRA
program, therefore, provides about 73 million dollars.
Of the 40 million dollars long-term credit given to Poland
- 79 -
by the Import-Export Bank of the United States for the purchase
of rolling stock, and the 50 million dollar credit for the pur-
chase of American Army surplus stores, only 30 million dollars
had been spent by the end of 1946; there is thus available, in
1947, another 60 million dollars for purchases in the United
States.
Finally, it is estimated that available exchange and in-
visible exports in the form of receipts from shipping, transit
trade, remittances from Polish emigrants abroad and private
medium term credits, will amount to about 30 million dollars in
1947.
Although Poland participates to the extent of 15 percent in
the reparations due to the Soviet Union, and although equipment
carried away by the Germans is returned to Poland whenever it
can be identified, the bulk of the reparations will not be re-
ceived during the next three years and it is unlikely that any
appreciable assistance in meeting the deficit will be derived
from these sources, particularly in view of the serious economic
situation in Germany. In total, therefore, Poland's certain
sources of funds in 1947 amount to 162 million dollars. This
leaves a deficit of 248 million dollars which must be raised in
the form of direct relief from abroad, or long term credits.
The Polish Government is now making a new analysis of its
balance of payments in the years 1947-1949, taking account of all
kno.vn factors, including repayment of credits obtained in the
year 1946 through its trade agreements, return of looted equip-
ment from Germany and the utilization of foreign exchange, but it
is believed that the deficit will remain at approximately the
same level, though it will probably be nearer to 240 million
- 80 -
dollars.
What are the prospects in 1947 for Poland receiving such
assistance? All efforts to continue relief to Europe's devastat-
ed countries, either in the form of UNRRA assistance or through
new international relief organizations, have failed. However, it
has been agreed that individual countries should make up their
own programs of relief supplies and that these programs should be
co-ordinated by a special committee of exports of the United
Nations. In practice, this means that the United States, which
will, in any case, be the largest contributor of relief supplies,
is formulating its own program of relief for the various
European countries. There is every hope that Poland will receive
a substantial share in relief in this form not only from the
U.S.A., but from other countries who wish to continue relief
programs. In regard to long-term credits, the creation of the
International Bank has enabled Poland, by becoming a member of
the bank, to apply for a long-term investment credit of 600
million dollars.
Without a more detailed analysis of the individual items in
the Polish requirements for raw materials, capital equipment,
transport charges, and payments on account it is impossible to
depict accurately the exact sources from wihich the long list of
requirements for funds would have to be financed. However, an
attempt has been made in the following table to set out, on the
one hand, the funds required, and on the other, the definite
sources at present knowm, and, finally, the outstanding require-
ments which would have to be satisfied from relief and from the
International Bank. This table, which must of necessity be very
approximate, has been drawn up by the UNRRA Mission on the basis
- 81-
of scattered information regarding the extent to which Poland's
own barter agreements will provide for imports under the various
headings, the undelivered items remaining in the UNRRA program,
and the knowm limitations on the purpose for which the Inter-
national Bank for Reconstruction and Development may loan funds.
It is clear from the table, that Poland will find the great-
est difficulty in financing her deficit of 248 million dollars.
At first sight, it might appear quite easy should the Internat-
ional Bank grant a loan of 600 million dollars. However, the
fact is that, out of the deficit of 248 million dollars, 79
million is in the form of food requirements and 35 million
dollars for expenses in connection with food imports. Since the
International Bank cannot, through its terms of reference, lend
for food, there is, therefore, a need of 114 million dollars
which can only be financed in the form of relief. There is also
another problem; out of the remaining total of 134 million
dollars which might conceivably be lent by the Bank, 33 million
dollars are for raw materials and 50 million dollars for finan-
cial) administrative and transport charges, for both of which
purposes the Bank might be unable to make loans. Summing up the
picture, however, it can be stated that Poland's estimated needs
in 1947 are 114 million dollars in the form of relief for food
impQrts, and 134 million dollars in the form of a long-term
credit from the International Bank.
- 82 -
TABLE XXI.
Requirements and Sources of Funds for Poland's Imports n 1947(in millions of U.S. Dollars)
Requirements from:Require- Known Sources International
Item ment 1/ of Funds Relief Bank
Imports Transit
Food 136 Trade etc. 10 79Exports 12UNRRA 35
Consumption Exports 6goods 7 UNRRA 1 --
Raw materials 223 Exports 191 - 33
Essentialcapital Exports 60equipment 118 UNRRA 37 - 21
Non- es sentialcapitalequipment 30 Exports 30
Exchange:
Payments onaccount forcapitalequipment 30 _ _ 30
Financial, admin-istrative andtransportcharges:a. Food 35 - 35
b. Capital Transitequipment trade,and raw shippingmaterials 70 etc. 20 - 50
Total 649 Exports 298 114 134UNRRA 73Transittrade,etc. 30
1/ 60 million dollars of rolling stock and surplus property areexcluded from this table since the credits have already beenobtained and the item would, therefore, enter on both sidesof the balance sheet.
Source: UNRRA Mission to Poland.
- 83 -
More recent calculations of the balance of payments will al-
most certainly affect the above conclusions. It is believed
that, although the total deficit will be about the same, require-
ments in the form of relief food supplies might be only about
100 million dollars, while requirements for raw materials and
investment goods might be about 150 million dollars. Of the
latter, about 55 million dollars represent costs of raw materials
imports.
Progress is being made towards obtaining these funds. It is
encouraging to note that the committee of the United Nations, in
assessing the needs of various countries for relief, finally
fixed a level of 133.9 million dollars for Poland. In view of
the price changes which have occurred since import requirements
were built up,this amount seems to be approximately the right
order of magnitude, and it is to be hoped that the individual
countries, and particularly the United States, will implement
this decision and provide relief on this scale for Poland, thus
solving her import problem in the food field. The long-term
loan for industrial development is actively under consideration
by the Bank.
1948 and 1949
Turning to the years 1948 and 1949, the problem is somewhat
simpler. We have already seen in table XIX that the excess of
imports over exports in these years totals 555 million dollars,
all of which represents imports of capital equipment for dnvest-
ment. Furthermore, in 1948 and 1949, payments on account (some
30 million dollars), which were made in 1947, will count on the
credit side of the balance sheet, and the only additional charges
which remain will be the financial administrative and transport
- 84 -
charges by foreigners on Polish imports. It is likely that the
latter will b.e offset to some extent by similar Polish charges
to foreigners which are likely to expand considerably as her new
transit trade develops and her merchant marine increases. It
thus seems likely that the total deficit in the twuo years 1948
and 1949 will not be far in excess of 600 million dollars. Latest
estimates Tndicate that it will be about 620 million dollars. If
the loan of 600 mi'llion dollars is granted by the International
Bank and only 13.4 million dollars of this is used in 1947, there
will be 466 million dollars available towrards the 620 million
dollars required. It is, of course, conceivable that by 1949
the prices of capital ecuipment throughout the world will have
fallen, and in this case the loan from the International Bank
.Tould 7robably enable Poland to realize the bulk of her import
program and her Four Year Plan.
To sum up the Polish foreign trade situation as it appears
at the beginning of the critical year 1947, Poland's import pro-
gram wprhich is so essential for success in the agricultural and
industrial rehabilitation of the country, depends upon her receiv-
ing assistance in 1947 from twro sources. First she needs approx-
imately 114 million dollars in the form of an extension of relief.
This is necessitated by the critical food shortage in Poland
which has neen caused by the war, and represents the price, to
the rest of the world, of restoring Poland to self-sufficiency
and laying the basis of future exports of food to non-sufficient
European countries. Secondly, the achievement of the Four Year
Plan in the industrial field is completely dependent upon a
heavy program of investment imports, and to finance these imports,
Poland must receive 600 million dollars from the International
Bank.
- 85 -
It is hardly necessary to analyze the results of failure to
obtain these funds in 1947. Without food, Poland faces a con-
tinuation of meager rations on a bare subsistence level, and
without industrial investment from abroad., she cannot expand her
industrial production appreciably beyond present levels. Com-
pared with the wartime losses and sacrifices of the country, the
715 million dollars involved in helping Poland to her feet again,
is a trivial cost for completing the work that UNRRA began,
particularly when it is remembered that 600 million dollars of
this is a loan and would have to be repaid by Poland when her
industrial recovery was complete.
- 86 -
APPE1TDIX
Trade Agreements Concluded by Polandto 31st December 1946-
U. S. S. R.
(1) Agreement dated: July 7, 1945.
Imports Exports
Quantities of merchandise not stated Quantities of merchandise not statedbut total value is given as but total value is given as 95,000,00095,000,000 Gold Zloty Gold Zloty
(2) Agreement dated: July 7, 1945. To be delivered by Dec. 31st, 1945.
Metric Metrictons tons
Iron, IiIang, & chrome ores 280,750 Coal 4,750,000Tin, copper, nickel, alumin. 2,860 Coke 250,0000Non-ferrous metals 319 Iron and steel 67,000Asbestos XUingerite 770 Zinc 5,000Apatites 40,000 Cadmium 40Kaolin 7,000 Cement 70,000Talcum, non-purified 1,500 Calcinated soda 25,000Gasoline 9,000 Carbide 5,000Lubricants, greases 3,045 Phenilbetanaphthaline 100Diesel fuel 6,000Cellulose 17,000 Total 5,172,140Paper 3,000NTatural & synthetic rubber 350 Also: thous.Chemicals 513 Cotton fabrics 45,000 metersCombed flax 2,400 Woolen " 1,310 "Tobacco 3,400 Military footwear 260 th.prs.Rice 5,000 Window pane glass 200,000 sq. M.Cotton 25,000 Electric bulb assemb. 10,000 th.pcs.Wool 2,600 Glass containers forMiscellaneous seed 16,119 acids 70 '
Total 426,626Additionally the followTing products
UInder the terms of this agreement,, will be exported under this agreementsubject to importance also the in qualntities to be determined later:following comrmodities: rubber products, Metal fancy products,
oak barrels, box shooks, pegs andAnimal castings 40,000 bunches miscellaneousFabric for milling
sieves 2,500 metersScythes 200,000 piecesTraotors 150 "Automobile ("Gar") 150 "
it ("Zis") 1,200 "
Animal hides 100,000 "Driving belts 1,500 sq.mtrs.Films 40,000 meters
and some quantities of rubber belts tobe determined later, also:
Gold 21.63 klg.Platinum screens 57.04 klg,
Total value 297,500,000 Gold Zloty Total' value 297,500,000 Gold Zloty
- 87 -
U.S.S.R. (CoritinLed)
(3) Agreement dated April 12, 1946 To be delivered: March 31, 1947
Imports Exports
Tons Tons1/
Rye 57,000 Coal 1,100,000Barley 45,000 Coke 200,000Oats 15,000 Coal Pitch 13,000Rye 2/ 105,000 Iron and steel 30,000Wheat 2/ 30,000 Tubings 6,100Barley 2/ 40,000 Lead 1,500Millet 12,000 Electrolythic zinc 5,500Buckwheat 2/ 3,000 Refined zinc 40000* Peas 2/ 10,000 Zinc sheets 5,000Grainsl 3/ 100,000 " dust 400
Cadmium 100Calcinated soda 14,000
1/ Against provisions of the agree- Caustic soda 7,000-iment dated Feb. 8th, 1946 Bicarbonated soda 2,600
it purified 2,000
2/ Deliveries to be effected by Carbide 4,000August 1946. Chemicals 10,450
Artificial fibres 6503/ Grain varieties will be Cement 520,000
established separately; delivery Sewer pipes 10,000in August 1946. rt n connections 500
Plate glass 650Fajans 150Porcelain 120
0 Total tons 1,937,720
Additionally: Textiles, glass andglass products etc. and miscellaneous.
Total value $96,000,000.
- 88 _
STIZEDEiN
Agreement dated August 20, 1945 Delivery by December 1, 1946.
Fish and herring 3,000 tons Coal 4,000,000 tonsTurpentine 400 " Coke 800,000Graphite 100 " Salt 25,000Iron Ore 600,000 " Zinc 5,000Vegetable Oil Acids 250 " Zino !Thite 2,500Phosphorus 20 "' Zinc Dust 1,800 "Potassium Hydroxide 10 "AAmron-ia Soda 7,500Tanning extracts 3,900 "Creocote Oil 2,000Glycerine (Dynamite) 100 i" iscellaneous items,Felt for Paper Industry 100 " quantilbies not specifiedDrills 2,000 4,843,800 tonsWaste Paper 20,000 "Paper 40,000Cellulose 6,000Impregnated Paper 50Vulcanized Fibre 125 ihetal Products 4,247 "Yetal Alloys 100Copper and Alloys 393Ball Bearings 1,500 "Iviiscellaneous 500
682,345 i
Additionally: 1,000 calves100 heifers
1,000,000 Electric BulbAssemblies
and 100,000,000 S.Cr. of machiness tools, etc.
Total Value: $50,000,000 Total Value: $50.000,000
- 89 -
DEIMUSLRX
(1) Agreement dated August 29, 1945. Delivery: Until Completion
Imports Exports
Butter 10 r.il. D. Cr. Coal 400,000 tonsBacon 4 " " " Coking Coal 100,000 "Horses 5 " " " iined Coke 100,000Cattle 2 " M " Metallurgical Coke 10,000Seeds 0.5" " " 610,000 "
Fish 2 " " itIiscellaneous 3.5t it Also misc. valued 2 million D. Cr.
Total value 27 million D.Cr.
(2) Agreement dated October 7, 1946. Delivery: October 1, 1947.
Imports Exports
Butter 3,500 tons Coal and coke 1,200,000 tonsPork 2,500 " Coke 100,000 "Lard 500 " Zinc 2,000Meat 2,400 " Tubes 4,500 n
Cryolithe 300 " Zirc 1tThite 1,000 "9,200 tons Red Lead 500 "
Litharge 400 "Lithophane 200
Also Lorses, cattle, seed, herrings, Liquid Gas 60 "industrial products and miscellan1eous. Chemios 1,000
Greaseproof Paper 300
1,310,160 tons
Also: Miscellaneous items, quantitiesnot stated.
Total Value: 129,OQO,OOO Total Value: 129,000,000
- 90 -
ITALY
Agreement dated: October 10, 1946. Deliveries by: October 10, 1947.
Lemons 50,000 L. Coal 750,000 tonsOranges 5,000 L. Eggs 10,000,000 PCs.Castor oil 100 L Potato starch 1,000 tonsAlmond oil 60 L Potato flour 600 "Combed flax 5,000 L iNitrobenzol 10 lFlax fabric 50 L Analine & Paratoluidine 100 "Zinc ore 250,000 L Soot 2,000 "Lead ore 4,000 L Potassium salt 30,000 "Mercury 100 L Vegetable tar 600Metallic magnesiun 500 L Butane and propane 200 "Sulphur crystals 80,000 L Other 500,000 DolarsCelluloid 30 LCelluloid products 10 LSorgo straw 2,000 LBoric oils 25 LRaw oork and products 5,000 LPumice 1,000 LMagnesium carbonate 300 LMagnesium sulphate 500 LCitric acid 200 LTartaric acid 300 LBoric and Boracio acid 600 LLiquorice juice 100 LHerbs 200 LTanning extracts 5,000 LDyes 65,000,000 LMachinery 1,575,000,000 LFilms 12,000,000 LOther 107s000,000 L
1,559,410,075 I.L.
Total imports valued Total exports valued$20,000,000 $20,000,000
- 91 -
FRAUOCE
Agreement dated: July 1, 1946. Delivery by:
Imports Exports
Horses 17,500 Thous. Fr.F Fruit pulp 15,000 Thous. Fr.FSheep 10600 it Herbs 7,000 "
Rabbits- 1,700 l Workers I suits 50,000 "
Fruit 250 " Newspaper 60,000 "Pepper 17,000 " Miscellaneous 100,000 "Spices 4,300 " Seed potatoes 1,000 tonsPerfumery 25,000 " Seeds 265 "
Graphite 6,400 " Hemp & flax refuse 50 IChemicals 2,000 " Willew 10 "
Pharmaceuticals 50,000 " Coal 1,200,000 "Technical Porcelain 5,000 " Pitch 5,000 "
Photographic supplies30,000 Lead 1,000Books & periodicals 50,000 t" Tin 1,000 "
Leather products 5,000 " Chemioals 2,000Transmission belts 2,000 " Cotton fabrics 120Engines 19,000 "ICompressors 5,000 "Pressure regulators 500Equipment 24,300Public utility,highway, indust-rial equipment 32,500 "
Passenger ears 130,0000Spare parts 13,000Instruments 131,000 0Apparatus 45,000Misc. machinery 182,000 "Textile & indust-rial machinery 250,000 ti
FiLms 30,000 iOther 188,000 itGlue 305 tonsRabbit hair 1 "Resin 100 "Cork 200 "
Phosphates 100,000 "Asbestos 10 "
Grinding stones 20Aluminum 250 I
1ron Ore 200,000 "
Scrap iron 10,000Chemicals 1,085 "Dyes, varnish 845 "Talc 500 "
Gelatine 10Pectine 250Refractory brick 80Enamel 100 "
Thread 10 "Paper & products 37Tires 5,000 pcs.Tubes 9,000 t
Imports valued $17,000,000 Exports valued $17,000,000
92-
SWITZERLAVW
(1) Agreement dated: March 4, 1946 Delivery by: September l, 1947
Imports Exports
Food products 2,500,000 S,Fr. Edible mushrooms 250 TonsTextiles 2,500,000 't Seed potatoes 1,500 t
Machinery, instru-ments, etc. 9,500,000 " Casings 200,000 Pcs.
Electric products 1,500,0Q0 Turnip and beet seed 100 TonsPharmaceutical products 3,000,000 " Potato flakes 500Dyes 5,000,000 t Artificial silk 300 "
Mis¢ellaneous 1,000,000 t Animal hair & bristles 25 t
Willow 100 t
Prepared willow 750 "Carbon electrodes 200 t'
M iscellaneous " 500 t
w0 Sheet iron 500 tt
Sheet iron 500Steel cables & ropes 1O0 t
Zinc 3,000 'Arsenic 100 iHerbs 30Ammonium chloride 500 iPhenylbetanaptylamine 200 I
Cresol 1O0 "Coal oil 100 iChemicals 1,630 iPotato starch 300 iLead carbonate 300 t
Red lead 300 i
Zinc white 500 t
Lithopane 500 i0 }+iiscellaneous items,quantities unspecified
Total imports valued 25 million Total exports valued 25 million SwissSwiss Fr. Also merchandise valued Fr. Also one million tons of coalat 48,000,000 Swiss Fr. covered by and coke valued at 48,000,000 Swisscredit deliveries. Fr. to repay credit deliveries.
Total value of imports $17,026,000 Total value of exports $17,026,000
- 93 -
NORINAY
(1) Agreement dated: August 29, 1945 Delivery by: December al. 1945
Imports Exports
Herrings 75,000 Bar Coal and Coke 600,000 Tons
Herrings 25,000 " Bunker coal 30,000
Cod liver oil 100 Ton Total tons 650,000
Imports total value $5,492,955 Exports total value $5,492,955
(2) Agreement dated December 31,1946 Delivery by: December 31, 1947
Cod liver oil 500 Ton Coal 600,000 TonsFish oil 300 " Coke 100,000Oil for canned fish 1,500 " Zino white 500Herring 200,000 Bar Lithopane 200Herring, fresh frozen 6,000 Ton Red lead 100
Fish other 1,OOO " Chemioals 140
Calcium nitrate 13,300 " Sheet iron 200Caliumn cyanamide 10,000 " High pressure tubes 4,000
Pyrites 50,000 " Sewage pipe 300
Vanadium ferro-alloys 1,500 " Cast iron pipe 1,000
Aluminum 500 " Iron sewagp pipe 700
Other miscellaneous items, Cast iron products 500quantities not specified Mlachine tools, chains,
and optical glass, quantitiesnot specified
Total tonnage 707,640
Imports total value 44,940,000 Exports total value 44,940,000Norwegian Kroner Norvwegian Kroner
tJ.S.S.R. ZONE IN GERIENY
Agreement dated Feb. 2, 1946 To be delivered: Dec. 31, 1946.
Imports Exports
Tons Tons
Potassium fert'ilizers 40% 177,.660 Coking coal 40,000Buna 4,000 Gas coal 50 zm/ra 100,000Synthetic gasoline 16,000 " ' 10-50 m/m 100,000Acetone 98% 50 " " unsorted 160,000Nitrate of soda NA NO2 98% 30 Metallurgic coke 400,000Anlydrons acetic acid 98% 30 Pure Benzol 12,500Crystalline anxalio Pressed iiaphthalene 1,600
acid pure 20Potassium Permangamate pure 5 Total tons 814,100
it cyanide 5Sodium cyanide 5Phartaceutical pepsin 1Carbon tetrachloride 99% 1
Total tons 197,807
Value: $10,223,000 Value: $10.,223,000
- 94 -
BULGARIA
Agreement dated April 29, 1946 Delivery: April 30, 1947.
Imports Exports
Lamb hides 120 Tons Iron and steel products 21,251 TonsKid hides 9 " Chemicals 3,313 "
Tobacco 3,127 " Pharmaceuticals 64 "I
3,256 Tons 24,628 Tons
All other commodities subject toindividual agreements
Value of Imports: $7,000,000 Value of Exports: $7,000,000
HOLJAND
Agreement dated December 18, 1946 Delivery by: December 31, 1947
Imports Exports
Tin 500 Tons Coal 100,000 TonsRubber 400 " Refined zinc 1,000 "
Electrical products 4,700,000 D.F1. Lead red 300 "
Industrial diamonds 200,000 " Zinc white 500 "Paint solution 50,000 'K Cadmium 10 "Regenerated rubber 10 Tons Iron & steel products 1,740 ttHospital linen 50,000,000 M2 Ladies hat cones 100,000 D.F1.Laboratory equipnent 50,000 D.F1. Cotton fabrics 2,000,000 IVietersVitamins & prepara- Workers suits 500,000 D.F1.tions 100,000 D.F1. Textile waste 200,000 D.F1.
Pharmaceuticals 250,000 D.F1. Glass 160,000 M2
Aromatic essences 100,000 D.F1. Domestic glass products 50,000 D.F1.0 Paints, Lacquxers & Porcelain 50,000 D.F1.Varnishes 50,000 D,F1. Electric bulbs 2,000,000 Pcs.
Prussian blue & Bristles 40 Tonschrome col. 100,000 D.Fl. Potassium salts 20,000 Tons
Dyes 132,000 D.F1. Seeds 75 "
Artistic paints 15,000 D.Fl. Seeds 30 "
Lithographic paints 50,000 D.F1. Yeast 150 "Chemicals 248,000 D.F1. Herbs 300,000 D.F1.Coffee 300 Tons Other 3,000,000 D.Fl.Cocoa bean 300 "CocOa powder 300Cheese 20Other foodstuffs 50 "
Other 39890 000 D.F1.
Imports total value 22,500,000 D. Fl. Exports total value 22,500,000 D. Fl.
- 95 -
HUNGARY
Agreement dated October 4, 1945 Delivery by December 310 1945
Imports Exports
Dollars Dollars
Beans 81,250 Coking Coal 220,000Peas 68,750 Coal 360,000Paprica 6,000 Unsorted Coal 36,000Sorgha Straw 22,400 Exchange of Coal Varieties 15,000Infusorial Earth 119,000Bauxite 87,500 TOTAL VALUES 631,000Sunflower Oil 35,000Quality Wines 27,500Commercial Wiffines 20,000Brushes 10,000Medicine 60,000Optical MeasuringInstruments 60,000
Miscellaneous 33,600
TOTAL VALUE 631,000
CZECHOSLOVAKIA
(1) Agreement dated July 16, 1946 Delivery: lIay 10, 1945 to April 30,1946
Imports Exports
Free currency in theamount of $2,699,158 Electric Power $2,699,158
(2) Agreement dated July 16, 1946 Delivery: From August 1946 onward
Free currency in theamount of $54,000,000 300 Mega-watts electric
power $34$000,000
- 96
AUSTRIA
Agreement dated September 21, 1946 Delivery by March 31, 1947
Imports Exports
Thousands Thousands
US Dollars US Dollars
Scythes 720 Coal 3,000
Sickles 60 Zinc 500
Drills 200 Ferro-;vianganese 35I\etal 25 Miscellaneous 100
Detonators 140Yielding Wire 20Klingerite 37Precision Instruments 255hiagnesite 12MIagnesite and RefractoryBricks 100
Pneumatic Tools 30Mviedical Apparatus 80Book Printing 100Electro-Technical Machines 250Letal & I1Wood-liforking 170Iviscellaneous 216Other 1,100
TOTAL VALUE 3,635 3,635
0
- 97 -
YUGOSLA.VIA
(1) Agreement dated January 1, 1946 Delivery by June 30, 1946
Imports Exports
Tons Tons
Zinc Concentrate 2,500 Coking Coal 50,000Lead 1,000 Unsorted Coal 125,000Chromium " 1,300 Coke 50,000Bauxite 3,000 Creosote Oil 2,000Raw Magnesite 400 fSodium Chloride 100Electrolytic Copper 500 Axmonium Carbonate 30Antimony 100 Nitric Acid 30Quicksilver 50 Ammonium Nitrate 400Tanning Extracts 600 Pitch Oil 150Leaf Tobacco 200 Sheet Iron 0.5 - 2 m.m. 100
If it 200 Sheet Iron " 300Miscellaneous 57 Sheet Iron 1 - 15 m,m. 600
Scrap Iron 100
TOTAL TONNAGE 9,907 TOTAL TONNAGE 228,810
Total imports valued 1$,225;000 Total exports valued $1,225,000
(2) Agreement dated August 29, 1946 Delivered by:
Zinc Concentrates 3,000.tons Chemicals 1,550 tonsLead Concentrates 2,000 tons Electrodes 300 tonshiagnesite 400 tons Fireproof Clay 550 tonsAntimony 100 tons Shamote Clay 500 tonsTanning Extraots 1,000 tons Eleotrio Detonators 1,000,000 pcs.Leaf tobacco 1,500 tons Electric Time Detonators 1,000,000 pos.Flax Refuse 500 tons Uniform Material 200,000 mtrs.Hops 30 tons Ingot iron 2,000 tonsRaw Opium & Lavender Oil 1 ton Sheet iron 1,000 tonsLiquorice 5 tons Construotion Steel 350 tonsPliscellaneous 500,000 dollars PW,ire 250 tons
Steel 4,300 tonsPaper 500 tonsMiscellaneous 600,000 dollars
Total imports valued 2 million Total exports valued 2 milliondollars dollars
- 98 -
BELGITIf
Agreement dated August 14, 1946 Delivery by September 1, 1947
Imports Exports
Horses 1,350 head Feathers 10 tonsFlax 750 tons Rabbit Hides 65 tonsGelatine 100 tons " " 2,500 pcs.Enamel 200 tons Dextrine 50 tonsGalalith 20 tons Seed Potatoes 100 tonsCaustic Soda 50 tons W.hite Clover Seed 30 tonsChemicals 1,250,000 B.Fr. Herbs 30 tonsChemical Raw Materials 145 tons Coal Tar 5,000 tonsRags 555 tons Potassium Salt 50,000 tonsWool Rags 425 tons Salt 5,000 tonsRubber Conveyor Alcohol 1,000,000 B.Fr*Belting 50,000,000 B.Fr. Wood Tar 50 tons
Refractory Froducts 150 tons Sodium Carbonate 1,000 tonsMirrors and Glass 120 tons Chemicals 1,250,000 B.Fr.Electrolitic Copper 300 tons Leather Refuse 150 tonsCokinig Equipment 20,000,000 B.Fr. Cotton Fabrics 7,500,000 B.Fr.Electric Equipment 14,000,000 B.Fr. Textile Products 2,000,000 B.Fr.Machinery 11,000,000 B.Fr. Textile Products 1,060,000 pCs.Photographic Suppliesl5,000,0O0 B.Fr. New-spaper 1,000 tonsMiscellaneous 50,000,000 B.Fr. Packing Paper 1,000 tons
Cardboard 600 tonsPorcelain 7,000,000 B.Fr.Sanitary Poreelain 3,000,000 B.Fr.Table Glassware 1,500,000 B.Fr.Lead 2,000 tonsEnamelled W'lare 2,500,000 B.Fr.Buttons 1,250,000 B.Fr.Miscellaneous 50,000,000 B.Fr.
Total imports valued 3 million Total exports valued 3 milliondollars dollars
- 99 -
F INIAID
Agreement dated July 5, 1946 Delivery by June 30, 1947
Imports Exports
Dollars Dollars
Horses 560,000 Coal Dust 160,000Stallions 20,000 Coke Dust 600,000Timber 660,000 Bunker 510,000Paper Refuse 147,000 Zinc WThite 97,500Wooden Houses 120,000 Salt 150,000Miscellaneous 187,000 Potassium Salt 3,500
Calcinated Soda 6,300Miscellaneous 1722,700
TOTAL VALUE 1,700,000 TOTAL VALUE 1,700,000
ICELAND
Agreement dated December 11, 1946 Deliveries by October 1, 1947
Imports ExportsTons Tons
-Wool 310 Coal 50,000Salted Hides 100
4 iWool 240
Total imports valued 999 thousand Total exports value 692,500 dollars.dollars Balance to be covered by coal
deliveries in 1948.