Economic Relations Between Third-World Marxist Nations and the

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FINAL REPORT TO NATIONAL COUNCIL FOR SOVIET AND EAST EUROPEAN RESEARC H

TITLE :

Economic Relations betwee n Third-World Marxist Nation s and the Soviet Bloc : A Case Study of Grenada : 1979 - 198 3

AUTHOR :

CONTRACTOR:

Frederic L . Pryo r

Swarthmore Colleg e

PRINCIPAL INVESTIGATOR : COUNCIL CONTRACT NUMBER : DATE :

Frederic

L.

Pryor

800-2 2

April, 198 6

The work leading to this report was supported by funds provide d by the National Council for Soviet and East European Research .

TABLE OF CONTENT S

EXECUTIVE SUMMARY A. B. C.

D.

E.

F.

G.

H.

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.

Introduction Research Materials Background on Grenada, 1. The Coup Events Leading to the Cou p 2. The Economic Context of Events 1. Backgroun d 2. PRG Economic Policie s Some Basic Political Factors 3. The Quest for Foreign Aid 1. Backgroun d 2. The Diplomatic Offensiv e The Strategy of the Ques t 3. 4. A Perspective Technical Assistance 1. Planning 2. Specialist s 3. Other Trading with the Soviet Bloc 1. Sale s 2. Prices Some Conclusions Soviet Bloc Relations with th e 1. Marxist Third World as a Whole 2 . A Perspective on Grenad a

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1 2 4

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36

40

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EXECUTIVE SUMMAR Y

On March 13, 1979, the New JEWEL Movement overthrew Eri c Gairy, Prime Minister of Grenada, and established a Marxist-Leninist government on this, one of the smallest , poorest, and most densely-populated Caribbean Island . Committed to the construction of communism in their island nation, th e leaders of the People's Revolutionary Government inherited a weak agricultural economy which depended primarily on the expor t of tree products (nutmeg, cocoa, and bananas) and tourism fo r hard currency . To finance the transformation of Grenada's Thir d World culture into a modern socialist state, the leaders turne d to outside sources of funding . First and foremost, they turne d to their elder brothers in socialism, the Soviet Bloc . Traditionally the Soviet Bloc has given few trad e concessions and relatively small amounts of economic aid t o their Third World allies . They are thus able to hold thes e allies rather inexpensively . Military aid is considerably mor e important than such economic aid and appears to be heavil y concentrated in a few countries . This military aid has provide d the USSR with the leverage to maintain discipline among it s allies in various international forums . Unlike most Third World Marxist nations, Grenada from 197 9 to 1983 was able to obtain considerable amounts of foreign ai d from the Soviet Bloc . The PRG, under the direction of Prim e

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Minister Maurice Bishop and Minister of Trade, Planning, an d Finance Bernard Coard, may be characterized as "foreign ai d socialism ." That is, Grenada's short-live Marxist experimen t under Bishop was an attempt to introduce socialism by a government that was completely dependent on foreign grants an d concessionary loans of like-minded nations to achieve it s economic aims . Grenada's experience with the USSR and othe r socialist nations provides insight into the process by whic h Soviet Bloc economic ties are structured with Third Worl d nations with a socialist orientation . Internationally, the PRG reoriented Grenada's foreign polic y to forge close links with Cuba and the Soviet Union . A usefu l indicator for this change is its voting pattern in the U .N . General Assembly in 1980, the year after the coup . Grenad a voted with Cuba 92 percent of the time (and never in opposition ) and with the Soviet Union 79 percent of the time (and only

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percent in opposition .) The PRG's foreign relations were a crucial part of its economic strategy since it attempted to us e its political services to the Soviet Bloc and the radical Thir d World as a lever with which to obtain foreign aid . The PRG was extremely successful in this strategy . Cuba wa s the most important patron to the island, giving about 30 percen t of the total economic and military aid . It is noteworthy tha t most of the aid from other Marxist nations came in the form o f grants and that the Soviets contributed much more military tha n economic aid . Aid from Western nations was quite small and, i n the case of British and Finnish loans, was tied to the purchas e

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of equipment from these countries . U .S . aid came primaril y through the Caribbean Development Bank, a multilateral lendin g agency which did not accede to U .S . requests to limit aid t o Grenada, even though the U .S . was the principal donor to th e Bank . Average annual grants and loans were about U .S . $25,000,000 . For a nation with a population of roughly 90,000 , this is quite significant, for the ratio of such aid to th e average gross domestic product was roughly 30 percent for th e five year period . Since it actually took the PRG almost a yea r to get the flow started, the actual ratio of foreign ai d received to gross domestic product was much higher than 3 0 percent in the early years of the regime . Cuba's major support of Grenada consisted of EC $82,000,00 0 for the construction of a modern airport to attract mor e tourism, given in the form of both manpower and equipment . Bu t Cuba also gave EC $17,000,000 for other projects . At the tim e of the intervention there were about 784 Cubans on the island , of which about 636 were working on the airport, 22 served a s military advisors, 17 worked as physicians and dentists, an d others worked as teachers, advisors to the Ministry of Interior , and other governmental bureaus . The Cuban aid was said to be given without strings and wa s particularly helpful to the PRG because it was continuous , responsive to the PRG's needs of the moment, directed at a variety of problems, and given as grants . It seems that th e Cubans made few demands of the Grenadians . They did, of course ,

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keep a close eye on them, and it is alleged that in the firs t years of the revolution the Cuban ambassador attended cabine t meetings . Further, the Cubans placed technicians in some ke y ministries . In any case, the PRG appeared most willing t o coordinate its foreign policy efforts with the Cubans and t o draw lessons from the "Cuban experience ." Although the Cuban s occasionally manifested displeasure in the course of Grenadia n events, they tried for the most part to maintain their role as a wise and generous uncle with considerable tolerance . The U .S .S .R . was a rather phlegmatic partner in Grenada' s construction of socialism . The stinginess of Soviet aid may b e attributed to two causes . First they did not wish to rile th e United States by developing unnecessarily close relations with

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nation close to its shores . Second, they preferred to let Cub a carry the brunt of the aid, especially since Cuba had mor e experience in dealing with Caribbean conditions . In 1980, th e Soviet Union signed an agreement to send arms to Grenada durin g the 1980 - 1983 period . However, they did not prove ver y generous with regard to economic aid . Although scholarships an d military grants were forthcoming, it was difficult for Grenad a to obtain much economic aid from the U .S .S .R . With regard t o agriculture, the Soviets noted that their aid efforts i n mechanized tropical agriculture had not been very successful an d had resulted in a loss of prestige ; therefore, they recommende d that the Grenadians try the Bulgarians and Hungarians for suc h aid . They also refused to help with the design of buildings , noting that the U .S .S .R . generally built much larger building s

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than those requested by the PRG ; again they recommended th e Bulgarians . They said further that they did not want to set an y precedents with Grenada . They stressed that the Sovie t bureaucracy needed a great deal of time to study various ai d requests . In 1981, 1982, and 1983, the Soviet Union did make severa l small grants for economic purposes, but these amounted to onl y EC $7,000,000 (US $2 .5 million) . The Soviets did not appea r interested in helping to finance the airport and they seemed t o respond slowly to the PRG's perceived economic needs . Nevertheless, the Soviet Union did send a series of missions t o Grenada, and they also established an embassy on the island . B y 1983, Soviet interest had finally been seriously aroused : a t the time of the intervention, 49 Soviet diplomats and advisors , headed by a three-star general, were on the island . In sum , Grenada was a political plum which unexpectedly fell in the la p of the Soviet Union and it took them considerable time t o appraise its worth . The other major figure in Grenada's network of socialis t financing was the GDR, which provided the PRG with a series o f grants, concessionary loans, and some technical assistance . I t seems that the GDR profited much more than did Grenada in thi s relationship, as the GDR foreign trade enterprises took grea t advantage of Grenadian incompetency or ignorance to obtai n highly advantageous import prices from the PRG, and at the sam e time, to sell obsolete equipment to them . Such other states a s North Korea, Czechoslovakia and Hungary offered technica l

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advice, but little else . In general, aid from the Soviet Bloc to Grenada was loosel y coordinated among the various countries, with participant s setting the interests of each national economy before assistanc e to the newest entry into the community of socialist states . This was most apparent in the behavior of the Soviet Bloc i n 1983, the critical year for Grenada's economy, when refusal b y the Bloc to provide emergency aid of less than $20,000,00 0 essentially wrote the island nation off the socialist ledger . In analyzing policy options of the U .S . in dealing with Thir d World Marxist nations, it is imperative to determine which ar e really considered vital to the Bloc's strategic purposes . Clearly Grenada did not appear very important .

NOTE : This report contains several tables of data within th e body of the text . The greatest challenge in working on th e economy of Grenada is the difficulty in obtaining long ru n series on the economy . Moreover, there are no official nationa l calculations . The appendix at the back of the report i s designed to overcome this difficulty somewhat by including th e various series which the author obtained or estimated .

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Economic Relations between Third-World Marxist Nations and the Soviet Bloc : * A Case Study of Grenada, 1979 - 198 3 A . Introductio n Economic relations between third world Marxist nations and the Sovie t bloc are somewhat enigmatic since relevant information is generally scanty . Data on the volume of trade and foreign aid are available for most of thes e Marxist regimes - and are reviewed in the final section of this essay - bu t such aggregate information does not reveal the political/economic force s underlying the data . Some data are also available on certain aid projects, bu t such information often reflects very specific events, rather than basi c political and economic trends . Finally, of course, there are ecstatic article s in the local press of the countries involved on such peripheral matters a s exchanges of delegations, ground-breaking ceremonies, and the like whic h deflect attention from more serious concerns . The case of Grenada, which had a Marxist government between 1979 an d 1983, differs from other such countries because a certain amount of usefu l information on its relations with the Soviet bloc nations is contained in th e archives captured during the U .S . military intervention in October 1983 . Additional details for this essay were obtained from interviews conducted wit h Grenadian officials involved in transactions with the Soviet bloc . My overall study of Grenadian economic relations with the Soviet Bloc ha d two purposes : to gain insight into the process by which Soviet bloc economi c ties are structured with third world nations "with a socialist orientation" ; and to understand the internal economic dynamics of these third-world Marxis t nations . This report deals particularly with the first of these two purposes ; most materials relating to the second purpose are presented in my forthcomin g book on Grenada's economy during the period from 1979 to 1983 .

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This report is organized in the following manner : Section B focuses upo n the basic sources of information and the ways in which these materials can b e used for research on the Soviet bloc ; Section C deals with the background o f the coup ; Section D covers the economic context of events ; Sections E, F, an d G deal respectively with Soviet bloc economic aid, technical aid, and trad e with Grenada ; Section H discusses relations between the Soviet bloc and th e entire group of third-world Marxist nations and draws general conclusion s about the case of Grenada . B . Research Material s The materials captured by the American forces in Grenada during th e military intervention are now available for public examination in the U .S . National Archives, Modern Military Headquarters Branch . They consist of abou t 10,000 microfiches and are arranged in a higgely-piggely fashion with man y duplications ; in many cases photoreproduction is also quite poor . Only abou t three quarters of the materials are indexed and, it should be added, th e available index is quite inadequate . A number of the microfiches are als o missing . The materials include minutes of Central Committee and Politica l Bureau meetings, internal memoranda, and statistics as well as diaries , receipts, bank account statements, inventories, love letters, propaganda, an d other detritus which permit quite a detailed view to be gained about th e 1/ period .— Unfortunately, the Grenadian government set the President's Offic e and Foreign Ministry on fire shortly before the military intervention so as t o prevent certain papers from falling into U .S . hands . Therefore, many usefu l materials relating to foreign relations are not in the archives . On the whole I found most Grenadians quite willing to talk about thei r experiences during the 1979 - 83 period and my interviews included : Bernard Coard, the Minister of Finance, who succeeded Maurice Bishop as Prim e Minister ; one former Prime Minister (Eric Gairy) and the Prime Minister

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designate after Coard resigned (Earle Bullen) ; three other cabinet member s (Lloyd Noel, Kendrick Radix, and Lyden Ramdhanny), one permanent secretar y (Lauriston Wilson), several active members of the youth group including its founder (Basil Gahagan), and a number of businessmen, educators, second leve l governmental officials, newspapermen, educators, and many other Grenadians wh o were willing to share their experiences . Several members of the revolutionar y government also flatly ref sed to talk with me . I also conducted interviews with several U .S . State Department officials including two ambassadors t o Grenada and the head of the Caribbean office . In addition, I visited severa l U.S . factories processing Grenadian-supplied raw materials . At the present time several books and articles have been published on th e 2/ revolutionary period .— With one exception all deal primarily with th e domestic politics of the period ; and the single book focusing on the economy (by Jay Mandle) is rather general and does not handle most of the issues i n much detail . All of these books draw from readily available Grenadia n documents which have been published by the U .S . State Department ; only on e book (by Sandford and Vigilante) is based on serious use of the less readil y available archival materials . In short, we have enormous research materials with which to deal . Unfortunately, these materials are not as explicit on many issues as we migh t wish and in many cases we are left only with evidence from a set of separat e incidents, from which we must draw our own conclusions . Nevertheless, th e evidence on the behavior of the interested parties permits us to draw certai n inferences about Soviet bloc policy-making mechanisms which complement ou r knowledge drawn directly from Soviet bloc sources . The most important gaps in our knowledge of Grenada during the period ar e on two topics : a) foreign policy ; b) social organization, particularly the

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roles played by the mass organizations for women and youth, the labor unions , and the church . The available materials would permit serious study of bot h topics ; the latter would be especially useful in understanding how other thir d world Marxist nations function . C . Background on Grenada 1 . The Coup On March 13, 1979 while Eric Gairy, the elected Prime Minister o f Grenada, was out of the country, a small group of activists of the New JEWE L Movement (henceforth NJM) stormed the main army barracks in True Blue (a hill y area about five miles from the capital), successfully overturned th e government in an almost bloodless coup d'etat,

and created a new regime whic h

became known as the People's Revolutionary Government (henceforth PRG) . Th e leader of the party, Maurice Bishop, was designated as the new Prime Minister ; and the second in command of the party, Bernard Coard, became the Deputy Prim e Minister and the Minister of Trade, Planning, and Finance, i .e ., the effectiv e head of the economy . Although the PRG revealed very little of how the coup was carried out,

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was able to reconstruct events from the description of several participants . The military action was carried out by only about 18 men and the success o f the first blow allowed them not only to capture weapons but to gain control o f the radio station from which they directed subsequent events . Two aspects o f these actions are noteworthy : first, the governments of these microstates ar e extremely fragile ; second, the major fighting was carried out by members o f youth group associated with the party (OREL : Organization for Revolutionar y Education and Liberation) who subsequently received high appointments in th e police and army and who played a major - if not the critical - role in th e removal of Maurice Bishop as head of the Party four and a half years later . They represented the dogmatic left of the revolution . (In passing it should be

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noted that in a number of third-world Marxist nations, youth groups hav e played extremely important political roles, e .g ., in the People's Republic o f the Congo ; political scientists might do well to focus more attention in thei r future research upon such groups . ) The degree of Cuban and Soviet complicity in these events is not ye t known . A number of Grenadians including Lloyd Noel, a close friend of Bisho p and Minister of Justice of the PRG (before he was imprisoned) have asserte d [interview] that a small number of Cubans participated in some manner in th e attack on the True Blue barracks ; but he has not yet published his memoir s with the evidence . Some interview evidence is available that Guyanese troop s 3/ participated in some way— ; however, one eyewitness to the military actio n (who seemed reliable) denied to me that any foreign troops directly took par t in the military action . A Soviet tourist ship carrying West German tourists , the Ivan Franco, was also in the harbor on the day of the coup ;

these Soviet

boats visited Grenada two or three times a year and it is not known whether o r not this timing on the day of the coup was fortuitious . The rise and reign of the PRG has important historical and politica l interest . For the first time in the English speaking West Indies, a politica l party of the left had adopted the time-worn practice of the Latin America n right of unseating an elected government by force of arms . In its 55 months o f power the NJM tried to transform the politics, international relations, an d economy of Grenada . It suppressed political opposition, dominated the new s media, and successfully created a one party state . It reoriented Grenada' s foreign policy to forge close links with Cuba and the Soviet Union . It tried to institute a series of changes in the economic system so that the islan d nation had a "socialist orientation ."

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2 . Events Leading to the Coup Tracing the deep historical roots of the Grenadian coup is more properl y a historian's task than mine . Certainly, the early history of the islan d follows the confused and violent pattern of many of the other islands in th e region . One special feature, however, deserves brief mention . Grenada has no t only been relatively unknown in the wider world, but in the British Wes t Indies, Grenadians are considered "small islanders", and many from the islan d who emigrated to larger islands in search of greater economic opportunites , were subject to exploitation and mistreatment . This small island status no t only reinforced Grenadian realization of its relative economic and politica l backwardness but also encouraged a foreign policy fascination on the part o f PRG leaders to the relative neglect of the domestic economy . The rest of the story of events in Grenada can, perhaps, be most conveniently told in the for m of brief sketchs of the three most powerful men in the Grenadian governmen t from 1979 through October 25, 1983, namely Eric Gairy, Maurice Bishop, an d Bernard Coard, provide some useful background for the events described below . On an island as small as Grenada, personalities play an important role in thi s political-economic drama . a . Eric Gair y In 1951 Eric Gairy burst onto the Grenadian scene and led

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successful strike of the plantation workers - the most extensive strike th e island had ever witnessed . The loyalty of these workers, which stemmed from a combination of Gairy's charisma and the substantial wage increases which h e obtained for them, created the power base which led to his domination o f Grenadian politics for more than a quarter of a century until overthrown b y the NJM in 1979 . In 1951 the United Kingdom also granted Grenada limited self rule wit h universal sufferage, an important milestone on the island's path toward

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political independence . After two years of negotiations with the U .K . Gairy , as elected head of the Grenadian government, obtained full independence to th e island in 1974 and Grenada became the first of the smaller Windward Islands t o achieve this status . This controversial step in Grenada not only solidifie d Gairy's political support in certain Grenadian circles (especially the rura l sector) but also exacerbated the fears of his opponents that in the futur e there would be no external force to curb his excesses as there had been in th e past . Gairy's years of governmental leadership were stormy . He was repeatedl y censured for "squandermania" (wastage of public funds) and in the early 1960' s he was banished from Grenadian politics for a series of open transgression s against public law . Further, as the years passed, he seemed to becom e increasingly more erratic, authoritarian, and repressive . He announced hi s annointment by God to rule Grenada . He lectured the U .N . General Assembly and other international organizations on the necessity of carrying out psychi c research and studying flying saucers, a performance which reinforced th e feelings of small-island humiliation on the part of his fellow Grenadians . Gairy's political orientation raised considerable opposition : from the established plantocracy in this early years and later from groups of educate d young men and women wishing to change Gairy's personalistic politics in orde r to modernize the country's economy and government . Among these was the New JEWEL (Joint Endeavours for Welfare, Education and Liberation) Movement , formed in 1973 by a fusion of two smaller parties to combat the arbitrarines s and corruption of Gairy's government . Gairy dealt with this opposition in a n authoritarian manner : his various security forces murdered and brutalized hi s political opponents : indeed, the NJM gained considerable political capital i n the "Bloody Sunday" incident of November 18, 1973, when Gairy's police beat

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up Maurice Bishop and his colleagues in a very public and brutal fashion an d also, several months later, when the police killed Rupert Bishop, the fathe r of Maurice, who was trying to shield a group of women and children in fligh t from a confrontation between security forces and some demonstrators . The late r years of Gairy's government were characterized by constant political turmoil , strikes, and on his part escalating rounds of repression and brutality, whic h resulted in greater resistance and struggle against him . Gairy's government also practiced a type of mean-spirited statism t o centralize power, e .g ., his virtual elimination of local government ; hi s etatisation of the various cooperative marketing boards ; or his expropriatio n of estates, homes, and businesses with the promise but not the practice o f paying compensation . By 1979 his government was running into severe problems : administrative and financial controls were chaotic, expenditures were large r than revenues, and the government was finding it increasingly difficult t o borrow to finance the deficit . In brief, Gairy proved repeatedly that he coul d easily be elected as Prime Minister, but that once in office he could not rul e wisely . In the late 1970's Gairy's support from the urban and more educated strata eroded further, not only because of his repressive and incompeten t administration but also for the corruptness of his administration . The variou s political parties opposing Gairy joined together in the People's Alliance i n the 1976 election and won 48 .2 percent of the vote for the Parliament . In our interview I found little of the charisma which he is supposed t o possess . However, to my surprise I found him soft spoken, polite, intelligent , and seemingly in good mental health . He also made one extremely perceptiv e remark : "In my life, unfortunately, I have been surrounded by two types o f people : those who are very loyal, but not very intelligent ; and those who ar e very intelligent, but not very loyal ."

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b . Maurice Bisho p Maurice Bishop was born in 1944 into a middle class family, took hi s primary and secondary education in Grenada, and numbered among the privilege d few to study abroad, obtaining a law degree at Gray's Inn in London . Returning home in 1970 to practice law, he was particularly impressed with th e Black Power movement which shook Trinidad and Tobago . In 1972 he and anothe r young lawyer, Kendrick Radix, founded the Movement for Assemblies of th e People, an urban based party which merged the next year with JEWEL, a rura l based party, to form the NJM . The new party started out somewhat left o f center and with a large membership base, .but moved rapidly leftwards afte r 1975, becoming a small "vanguard" party in the process . Although there wa s collective leadership within the NJM, Bishop soon became the first amon g equals ; and between 1973 and 1979 most of his energies were tied up i n leading the NJM in its political activities . Bishop was also elected to th e Grenadian parliament in 1976 and led the opposition against Gairy . Following the

coup of March 13, 1979, Maurice Bishop became Prime Minister of Grenad a

shortly before his 35th birthday . Bishop brought many gifts to his new job, especially the ability t o communicate effectively ideas and ideals to the public . He was a "man o f words" and such gifts were particularly important in the period from 1979 u p to the beginning of 1982, which can be characterized as the mobilization phas e of the new government . During this time the PRG generated considerable suppor t among Grenadians, especially by trying to involve the population in its man y projects for change . The PRG revivified local government, extended its mas s organizations for youth and women, and set up new mass organizations fo r farmers and others . The PRG struck down a number of repressive laws whic h Gairy had passed and introduced much progressive labor and social

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legislation . The new government also mobilized support abroad and succeeded i n attracting a large amount of foreign grants and loans . But after 1982 when the government tried to consolidate its gains, Bisho p proved less equal to his tasks . Indeed, by the summer of 1983 Grenada wa s facing its most severe economic crisis, for it had not only a severe balanc e of payments problem but . also great difficulties in financing domesti c governmental expenditures . Political difficulties compounded the problem, fo r according to various Central Committee members, the various mass organization s were either split or in the process of collapse and even the party was said t o be disintegrating, although this charge was made primarily by those wishing t o replace Bishop . On September 16, 1983 the NJM Central Committee attempted to create

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dual leadership of the party and to appoint Bernard Coard to serve with Bisho p as co-leader . Although Bishop acquiesced and left shortly thereafter for

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scheduled trip to Czechoslovakia and Hungary, he changed his mind upon return , and thereafter events moved quickly . Late in the evening of October 13 he wa s ousted from the party and placed under house arrest ; on October 19 he wa s freed from house arrest by a large crowd ; and a few hours after that he wa s executed by soldiers loyal to the new government . From the fast-movin g internal dynamic of incidents, Soviet or Cuban particiation or complicity i n these events does not seem likely . Both his friends and enemies have criticized Maurice Bishop as a poo r administrator . Due perhaps to his legal training, he was immersed in detail s and lost sight of the larger picture . He coordinated the work of hi s subordinates poorly and, according to Kendrick Radix [interview] would hel p them with details such as writing letters but would not give them ver y satisfactory general instruction to do certain tasks by themselves . With the

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best of intentions, he was unable to follow through his directives t o subordinates in order to insure that the assigned tasks were fulfilled in

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proper and timely fashion ; indeed, some of his subordinates complained to m e that he seemed unwilling to give a flat yes or no to various questions o r requests . I was also told that in numerous critical negotiations he did no t provide position briefs for those representing him . He tried to direct th e various party and state organs by obtaining concensus, rather than cuttin g discussion at particular points and making a decision ; this led not only to endless meetings but also to a reputation for vacillation . Although the extent to which Bishop was responsible for Grenada' s problems in 1983 is unclear, as head of the party and government he wa s blamed . His inability to administer the government and party in an effectiv e fashion provided the formal excuse of the Coard faction in the NJM Centra l Committee to remove him from office . I never met Bishop but he had, by all accounts, a commanding and magneti c personality . Handsome and tall with a radiant and optimistic manner, from hi s school days on he was always a leader . His charm was such that even hi s political enemies liked him as a person ; and all agree that he was

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mesmerizing orator . Many of his speeches have been assembled in a number o f collections and they read extremely well . But herein lies a serious problem o f understanding what Bishop really believed, for his views changed often an d many discrepancies between his stated beliefs and his practices appear : in th e late 1970's he was praising parliamentary democracy, while once in power h e celebrated in the same commanding tones its demise ; in the earlier period h e spoke out forcefully against restriction of the press by the Gairy government ; in the later period he closed down all widely circulating newspapers whic h objected to PRG policies in even the most mild fashion . In the earlier period he spoke up for the rights of prisoners and against the death penalty ; in the

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later period he imprisoned his political enemies without cause or trial an d "changed his mind" about the death penalty . A number of recent books an d articles have judged Bishop and his ideas by his words, but given hi s vacillations, this is not a useful course to follow ; he can be evaluated onl y by his deeds . c . Bernard Coar d Bernard Coard was born in the same year as Bishop and also cam e from a middle class family in St . George's . He studied abroad, receiving

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B .A . in economics from Brandeis University and an M .A . in politics from th e University of Sussex . He served as a school teacher in London, later lecture d in economics at a branch of the University of the West Indies, and returne d permanently to Grenada in 1976 to enter politics . He linked up not only with the NJM but also with Organization for Revolutionary Education and Liberatio n (OREL) which not only served as his political base within the NJM but whic h played the crucial role in the intra—party struggle in September and October , 1983 . In December 1976 he was also elected to the Grenada parliament as an NJ M candidate . Due to his intelligence and speaking abilities he rapidly became a n important force in the NJM and was widely considered to be the party's leadin g intellectual and ideologue . After the coup Coard was named Minister of Finance, Trade, and Planning and later as Deputy Prime Minister (which paralleled his party rank) ; effectively he acted as head of the Grenadian economy . In the first few year s he succeeded in bringing some order into the administrative chaos which th e PRG inherited . Although the economy registered some important successes, it s performance also fell considerably below expectations which, perhaps, Bisho p had raised too high . The macroeconomic indicators of Grenada during the PR G period are not particularly impressive and, although unemployment somewhat

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decreased, the average standard of living appears to have fallen as well . In October 1982 Coard resigned his position in the Central Committee , the Political Bureau, and Organizing Committee because of disagreements wit h Bishop (his wife, Phyllis Coard, did keep her position on the Centra l Committee) . He maintained his job as Deputy Prime Minister and continued t o direct the economy . In September 1983 he was named as co-leader of the part y and, after Bishop's house arrest in October 1983,

served for a few hours a s

head of party and government before resigning as Prime Minister . His role i n the party thereafter is unclear ; whether he was manipulating the OREL members or whether the OREL group was simply using him as a front man may, perhaps , never be ascertained . As a person Coard did not possess Bishop's magnetism . Further, according to popular belief, in the party he was the "communist" while Bishop was th e "social democrat" ; however, matters were considerably more complicated . From materials in the Grenada archive, it appears that in matters of civil rights , Coard appeared to represent the hard line while Bishop was enclined to be mor e conciliatory ; but that in matters of economics, Coard stood to the right o f Bishop and was constantly advising the party to move more slowly, to attemp t fewer tasks, and to take more account of economic realities . Both shared the aim of a communist future for Grenada and their differences appeared primaril y tactical . In my interview with Coard - which was the only one granted to a nonfamily member or lawyer in almost two years - I found him intelligent , eloquent, likable, and willing to discuss issues in a constructive fashion . Although we disagreed on a number of theoretical issues, he clearly understoo d my arguments and analyzed them on their own ground . However, on some important points his economic ideas seemed fuzzy or contradictory ; and many of hi s factual claims differed enormously from his own statements found in the

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Grenada archives . We had this fascinating conversation under the watchful eye s of a police guard at the Richmond Hill Prison, where Coard, and 18 others wer e awaiting trial for 11 charges of murder including that of Maurice Bishop . D. The Economic Context of Event s 1 . Background Grenada is a small nation with a population of about 90,000 in 1981 . Of the Caribbean islands it has one of the lowest levels of per capita income an d one of the highest population densities . In the 1970's unemployment wa s roughly 20 percent and the emigration rate averaged about 2 .5 percent per yea r over the decade . The GNP appears to have increased only slowly . Unfortunately , the statistical base to analyze the Grenadian economy is not only inadequat e but also extremely difficult to locate ; a brief statistical review i s presented in the appendix and serves as the basis for these remarks . The major sources of Grenada's foreign currency - and of employment

-

were tourism and agriculture . However, during the 1970's the level of touris m did not increase, in part because of political instabilities experienced o n the island, in part because the island was difficult to reach since th e airport was inadequate and could not take large planes flying directly fro m Europe or America (so that tourists had to change planes in another Caribbea n island) . The island is extremely hilly, which makes agricultural mechanizatio n difficult : almost all exports of goods have consisted of tree product s (nutmeg, cocoa, and bananas) . During the entire period after World War II lan d flight was an important phenomenon, as manifested by a reduction in both th e cultivated area and in the agricultural labor force . During the 1970' s agricultural production focused increasingly on the major export crops

-

nutmeg, bananas, and cocoa ; and, for the first time, the island became a net

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importer of agricultural products, not only to feed itself but also th e tourists who visited the island . In short, it appears that the island wa s losing its comparative advantage in agriculture . When the NJM took power, the public sector was relatively large . Gair y had nationalized a number of large estates producing the export crops so tha t 10 percent of the land was already in the public sector . The state also owne d roughly half of the public utilities . Although statistics are quit e inadequate, the share of public expenditures in the GNP appeared to b e somewhat higher than third world countries in general, but somewhat lower tha n the average of the Caribbean nations . 2 . PRG Economic Policie s The PRG might be characterized as "foreign aid socialism," i .e ., the attempt to introduce socialism by a government completely dependent on foreig n grants and concessionary loans of like-minded nations to achieve its economi c aims . In the discussion below I devote considerable attention to the way i n which Grenada obtained foreign aid, for this was not only the key phenomeno n for understanding events in that nation but also its greatest economi c success . a . Nationalization The PRG took rapid steps to gain control of the "commanding heights " of the economy . It bought - or forced the sale at low prices - of all th e public utilities and two out of the four major banks . It was in the process o f increasing the state share of agricultural land from 10 to 25 percent . Thi s primarily took the form of forced leasing of the large agricultural estate s and turning them into state farms ; experiments with agricultural cooperative s were a failure and were abandoned . Direct expropriationvs were rare, especially in "visible industries" which might frighten away potential foreign investors . Most of the

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expropriation which did happen occured in the agricultural and housing sec tors . The PRG also founded or bought out a number of small industries, primar ily processing agricultural raw materials, almost all of which were quit e unprofitable . b. Planning and Central Administration Although the government did manage to put partly in order th e tangled public finances of the island, it had not yet introduced any signifi cant type of central planning . Indeed, any planning efforts were severel y constrained by the double lack of adequate statistics and skilled technician s who could administer such a system . The PRG did take the first step, namely devising a long-term strategy fo r development . This exercise involved three five year phases, according t o Maurice Bishop's "line of march" speech which he delivered to party cadre i n 1982 . In the first five years attention would be focused on the development o f tourism (of which the most important project would be the building of a ne w international airport, a project under discussion for several decades) an d agriculture ; during the next five years primary weight would be placed o n agriculture and agro-industries ; and in the third five year period developmen t efforts would be focused on manufacturing industries which are no t agriculturally based . A basic flaw underlay this 15 year plan . The thrust of the PRG's attempt to obtain foreign aid was to expand the tourism sector . As I note below i n greater detail, they maintained a shrill rhetoric against the United States a s part of their campaign to obtain foreign aid from the East . however, thi s rhetoric, - combined with the adverse economic circumstances in the worl d economy during the period from 1979 to 1983 - meant that the flow of tourist s was declining rapidly . The idea that American visitors, who served as the

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largest source of tourism, would feel comfortable vacationing in a socialis t nation seems dubious ; in any case, the rapid fall in the number of tourists o n the island whenever internal unrest occurred during the Gairy period suggest s that political conditions have been a major factor influencing tourism on th e island . c . Redistribution Policies and Institutional Change s Although the PRG placed great verbal emphasis on expanding th e education and health systems, resources to these sectors did not markedl y change during the period . Other public expenditures targeted at the poor were relatively small . Given the high progressivity of the income tax under Gairy , the government made little attempt to redistribute income by manipulation o f taxes . They did attempt to introduce a generous social security system durin g their last months ; however, the system had not worked sufficiently long t o determine the redistributional elements . Governmental development policy was also constrained by membership in th e Caribbean Community and also the East Caribbean Currency Authority . The forme r membership (a type of common market arrangement) made it difficult to us e tariffs as an incentive for industry or to devalue the currency . The latter membership required the use of a common currency with other Caribbea n microstates, which meant that the nation could not follow any kind o f independent monetary policy . The PRG made no attempt to resign from eithe r institution and, thereby, accepted a limitation of its sphere of economi c policy action . Although the government introduced a type of price control, thi s essentially meant that certain foodstuffs could be sold only at the impor t price plus a specified markup . The PRG also did not attempt to introduce an y type of special wage policy . Moral incentives were used only to encourag e people for volunteer labor during leisure periods to help rebuild school

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houses, tutor in a campaign against illiteracy, and participate in innumerabl e rallies . Other kinds of institutional changes were minor . A profit sharing syste m was introduced into the state sector, but there were few profits t o distribute . They also attempted to involve workers in various manageria l decisions, but this program was not well implemented and, for the most part , was ignored . The economic and administrative constraints faced by any third-worl d country in implementing a "socialist path of development" are sufficientl y great that it requires a quite extraordinary leadership to surmount the man y problems . The PRG had neither the leadership nor the experience nor the tim e to push the economic system very far toward socialism before it was overthrown . This, in turn, meant that Grenadian "socialism" was primaril y ideological and political, rather than economic . 3 . Some Basic Political Factor s The NJM followed a two-level ideological strategy : it presented itself to the Grenadian population and the capitalist world as a social democrati c movement ; but in internal party circles and to the Soviet bloc nations, th e leadership spoke and acted as if at the head of a Marxist-Leninist party . To qualify for being a "vanguard party," the leadership kept the number of part y members low ; the number of full members never exceeded 85 and the total part y never exceeded 350 . According to high-level foreign friends of Bishop such a s Michael Manley (a former Prime Minister of Jamaica ; this material comes fro m an interview), Bishop's two greatest political mistakes were not holding a n election (which would have provided the PRG with some legitimacy) and keepin g the party so small . In its 55 months of power the NJM tried to transform the domestic

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politics of Grenada . The PRG abolished the parliament, quickly suppresse d political opposition, and successfully created a one party state by the end o f its first year . It closed down newspapers which it did not control, i t imprisoned without trial any suspected opponents, and rode roughshod ove r civil liberties . It expanded greatly various mass organizations for women an d youth and dominated five out of the eight major labor unions on the island . Internationally, the PRG reoriented Grenada's foreign policy to forg e close links with Cuba and the Soviet Union . A useful indicator for this chang e is its voting pattern in the U .N . General Assembly in 1980, the year after th e coup

Grenada voted the same as Cuba 92 percent of the time (and never i n

opposition) the same as the Soviet Union 79 percent of the time (and 6 percen t 4/ in opposition) .— The PRG's foreign relations were a crucial part of it s economic strategy since it attempted to use its political services to th e Soviet bloc and the radical third world as a lever with which to obtai n foreign aid . The military ties of Grenada with the Soviet bloc have been discusse d elsewhere . I do not believe that the island had great geostrategi c significance for the bloc . Although the construction of the new airport wa s the major economic project of the PRG and absorbed about half of the foreig n aid which Grenada received, its planned usage appeared primarily civilian , especially for tourism . Of course, the airport did have a military potential , to which the PR G gave some attention, but this seems to have been a secondar y / consideration . 6/ E . The Quest for Foreign Aid-1 . Backqround In Grenada the origins of this stress on using foreign aid fo r development purposes can be found in the ideas of Eric Gairy . In 1974 Bernard Coard cited the following statement which Gairy made two years before to

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justify , .he severing of Grenada's colonial bonds with the United Kingdom : " . . .it is only when we attain full independence that our independent brother s and sisters numbering over 150 prosperous, progressive countries can com e 7/ directly to our aid ."-- Apparently Gairy had in mind two considerations : Colonies seem able to obtain significant economic aid only from the mothe r country, while independent nations can ask and receive aid from all ; moreover , Grenada's small size would give it a comparative advantage in obtaining ai d because a relatively minor loan in terms of the resources of the donor natio n could have a very large impact on the economy of the receiver ; and all aid givers like to have something important to show for their money . Unfortunately, the Gairy government proved quite inept in such efforts t o obtain aid . Successful aid-begging has several prerequisites .

First, the nation mus t

be widely and favorably known, at least if the donor government is responsiv e to domestic political pressures . Aid programs targeted at a country almos t totally unknown to most of the population in a democratic donor nation ar e open to strong domestic attack in the aid giving nation .

Second,

the ai d

request must be attractively packaged . Such a package could be political , e .g ., the strengthening of a government which is intensely loyal to the dono r nation ; or it could represent some engineering achievement which the citizen s of the donor nation can proudly point out, e .g ., a stadium, a steel mill or a n airport .

Third,

the receiving country must be expected to use such externa l

funds in an appropriate fashion and, if a loan, to make timely repayments . Without any doubt the PRG's greatest economic success was in obtainin g loans and grants from other governments and from international organizations . Table 1 below reveals this accomplishment by presenting summary data on th e most important foreign aid received . The data are, unfortunately, rather rough

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a/ Table 1 : Major Grants and Loans to the PRG by Source, 1979 - 1983- (millions of current US dollars ) Grants Economic

Militar y

Loans (not from commercial banks )

36 .6 1 .5 2 .6

3 .1 0 .7 0 .1 1 .3 10 .4

2. 1 -

Socialist nation s Cuba Czechoslovakia German Democratic Republic North Korea U .S .S.R . Radical Third Worl d Algeria Iraq Libya Syria

2. 3 7.2 0 .3 2. 4

10 . 4

Other Nations and Government Guaranteed Private Loan s Canada Finland (Metex) Nigeria U .K . government U .K. (Plessy Ltd .) Venezuela

2.9 0 .1 0. 4 0 .6

-

7. 3 -

-

1.9 -

International and Intergovernmental Agencies and Bank s Caribbean Development Bank East Caribbean Currency Authority European Development Fund EEC Emergency Fund International Monetary Fund Organization of American States OPEC UN Development Program UNICEF/FAO

2 .7 0. 3 0. 4 0. 4 0. 1

Other and non-specified

0 .7

-

5.7

62 .3

15 .5

47 .3

Total

1 .1

7.4 1.9 2. 1 6. 6 2. 0

a . The data do not include any loans or grants after October 1983 . Some of the estimates (e .g ., for the C .D.B .) are very rough . In a number of case s the underlying source materials conflicted with each other . Full details o f estimation are given in Frederic L . Pryor, op. cit .

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and have offsetting biases : They understate the true volume of such outsid e assistance because a number of small grants are not included ; for instance , Grenada had about 350 students abroad and, since they were studying primaril y on the basis of scholarhips and other aids from the host nation, thi s assistance represents an aggregate yearly grant of about U .S . $1 .5 million no t shown in the table . On the other hand, the nature of the sources made i t difficult in some cases to distinguish planned and actual aid and for thi s reason, certain loans (especially from Libya) may be overstated . It should be clear that Cuba was the most important patron to th island , giving about thirty percent of the total economic and military aid . It i s noteworthy that most of the aid from other Marxist nations came in the form o f grants and, moreover, that the Soviets contributed much more military tha n economic aid . Aid from Western nations was quite small and, in the case o f British and Finnish loans, was tied to the purchase of equipment from thes e countries . U .S . aid came primarily through the Caribbean Development Bank, a multilateral lending agency which did not accede to U .S . requests to limit aid to Grenada, even though the U .S . was the prinicple donor to the Bank . About half of the funds received came from economic grants ; anothe r eighth, in the form of military grants ; and the final three eighths, in th e form of loans, which were primarily given on very generous terms . Of the tota l amount of this foreign aid, investment in the new international airpor t accounted for slightly less than half . To place these data on foreign aid in perspective, it is worth noting tha t average annual grants and loans were about U .S . $25,000,000 . For a nation with roughly 90,000 population, this is quite significant for the ratio of such ai d to the average gross domestic product was roughly 30 percent for the five yea r 8/ period .— Since it really took the PRG almost a year to get the flow started , the actual ratio of foreign aid received to GDP was much higher than 30

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percent in the later years of the regime . 2 . The Diplomatic Offensiv e According to Kendrick Radix [interview], a former law partner of Bishop' s and a member of the NJM Political Bureau, the coup was a hurried affair an d the NJM did not take over the government with many definite economic plans . However, within a few weeks of taking over they reversed the position in thei r 1973

Manifesto against building a new international airport at Point Saline s

and started to work on the project . As Radix explained to me , "it was the easiest way to get aid :' In brief, the PRG had found an attractiv e package, one of the three prerequisites for obtaining foreign aid . Once start ed along this path, the government proceeded with great vigor and ingenuity . A key ingrediant of foreign-aid socialism was Grenada's relations wit h the United States . Everything started off quite smoothly, and two days afte r the coup Maurice Bishop had a friendly interview with the U .S . Consul Genera l (from Bridgetown, Barbados since there was no permanant U .S . diplomati c representation on the island) . The U .S . diplomat indicated that the Unite d States wanted to respond in a neighborly fashion to the new government an d that he would try to faciliate aid to the island . On March 22 the United States recognized the new government and a day later the U .S . ambassador fo r the East Caribbean area, Frank Ortiz, had his famous talk with Maurice Bishop . This was an awkward time for a serious exchange of views since Ortiz was bein g replaced as ambassador and was making his farewell visit to the island . Interpretations of this interview set the tone of U .S . - Grenadia n relations for the next four and a half years, but exactly what happened is no t entirely clear . Ortiz indicated that the U .S . was quite willing to provid e 9/ foreign aid but that certain bureaucratic procedures had to be followed .-When Bishop asked him directly for money for the airport, Ortiz replied

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that as Ambassador, he only had a fund of $5000 which he could allocat e without higher approval . Ortiz also apparently expressed himself in a n untactful manner about U .S . concerns regarding Grenada's establishment o f close relations with Cuba . Maurice Bishop responded publicly in an emotional speech on April 13 , 1979 entitled "In Nobody's Backyard ." He excoriated Ortiz for makin g unacceptable threats to Grenada about relations with Cuba and, indeed, th e next day Cuba's first ambassador arrived on the island ; simultaneously, the Cuban boat "Matanzas" docked in St . George's to deliver a considerable loa d of Cuban arms for the PRG to defend itself against any attempted counter-coup by Eric Gairy . This speech was well received locally and, it might be added, by man y commentators abroad who have taken Bishop's version of the discussion at fac e value, although certain aspects of the speech are patently false, e .g . , Bishop's assertion that Ortiz only offered a total of $5000 foreign aid . However, this speech set the tone for Grenada's diplomatic offensive

-

incessant denunciations of the United States, combined with considerabl e resourcefulness in seeking aid from East Europe and radical third worl d nations by playing the role of a beleagered David facing a truculant America n Goliath . The purpose of my project is not diplomatic history ; nevertheless, it i s worth emphasizing that from the evidence which I have seen, it does not appea r that Ortiz "drove Grenada into the arms of Cuba," as many have claimed . It wa s politic, however, for Bishop to make it appear that way . Without doubt the NJM wanted to establish closer economic and politica l relationships with Soviet bloc nations, but this does not necessarily impl y the denunciations and related tactics which the government adopted . However, I believe that the strident rhetoric on the part of Bishop was absolutely

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necessary in order to establish the proper "radical credentials" to implemen t the strategy of maximizing foreign aid receipts and that the verbal fis t shaking in the face of the U .S . was an important component in the exercise . In this manner Grenada made itself favorably known to the world which it wished to impress, another of the three prerequisites for obtaining foreign aid . The Cuban aid, which arrived so promptly, came about because of th e personal friendship between Maurice Bishop and Fidel Castro and the trus t which Castro placed in the PRG . Further, in the ensuing months Cuba wa s enlisted in the airport project and soon sent technicians to Grenada to assis t in the planning of the project . By December 1979 the first Cuban machines and contingent of constuction workers arrived and the project began in earnest . Grenada's first hesitant steps farther afield among other Soviet bloc nation s were less successful . For instance, Bernard Coard's first trip to the Sovie t Union in 1980 resulted in very little economic help - not even a serious trad e agreement -although the Soviets did make a small grant of 4 .4 million rubles (at the 1980 exchange rate, about US $ 6 .6 million) for military equipment later in the year . Forays into the radical third world yielded more fruit . In its fateful first year of power, the PRG had to finance its variou s projects primarily from internal sources since relatively little foreign ai d arrived . They were trying to get the economy in order and actually ended th e year by bringing government revenues and expenses roughly in balance an d reducing Grenada's international short-term indebtedness . They were also cultivating potential aid donors in order to achieve the final prerequisit e for successful aid begging . In the next year, this diligence paid off and le d to a flow of foreign aid which never ebbed thereafter . The crucial aspects of this diplomatic work were shown in an undate d (apparently 1981) report to the NJM Central Committee where the twelve most

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important PRG foreign policy goals are outlined, of which seven concerned th e necessity of obtaining external economic aid of one type or another . Bishop continually lectured his ambassadors how they were the key of the economi c success of the nation . 3 . The Strategy of the Quest During its first few months Grenada developed quite different strategie s for obtaining foreign loans and grants from the socialist nations, the Wester n nations, and the international organizations . For the former group of nations Grenada had prepared a shopping list of projects by May 1980 and had targete d potential donors : Bulgaria, Cuba, Czechoslovakia, Hungary, Poland, and th e USSR . Interestingly, the GDR, Romania, Yugoslavia and the Asian socialis t nations were omitted, although East Germany and North Korea later becam e relatively important donors . In an undated "list of countries with whic h Grenada does not wish to develop close relations" one finds China sandwiche d in between Chile, Haiti, Israel, Taiwan, and South Africa (as well as th e Comoro Islands and Egypt) : clearly Grenada very carefully picked sides in th e Sino-Soviet split . a . The U.S .S .R. In 1980 the Soviet Union signed an agreement to send arms to Grenad a during the 1980 - 1983 period . However, they did not prove very forthcoming with regard to economic aid . In a meeting of the Political Bureau in June 198 1 Maurice Bishop suggested that the best way to "get to" the Soviets might b e through Bulgaria or the GDR . But other means were tried as well, and in

a

memorandum dated July 1983 Richard Jacobs, the Grenadian ambassador to th e USSR, made some extremely acute observations (I have corrected punctuation an d 10/ spelling) : "The Soviets have been burnt quite often in the past by giving suppor t to Governments which have either squandered that support, or turned aroun d and become agents of imperialism, or lost power . One is reminded of Egypt,

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Somalia, Ghana and Peru . They are, therefore, very careful, and for u s sometimes maddingly slow in making up their minds about whom to support . They have decided to support us for two main reasons : a) Cuba has strongl y championed our case ; b) They are genuinely impressed with our management o f the economy and state affairs in general . . . " "I have not formed the impression that there is any such generalize d view within in the [Soviet bloc] community . . .about Grenada . " . . the Soviets assess the level of state to state relations by , among other things, the extent to which we are willing to share ou r experiences with them and to learn from their experiences . . . " "I have formed the view that the USSR is satisfied with the degree o f support that they receive from Grenada . Indeed, I would say that they hav e every reason to be satisfied, especially if our vote on Afganistan, fo r example, is recognized as one of two Latin American votes (the other being Cuba) in their favour . Considering the risks that we have taken on this and other matters, it might be fair to say that their support for us is actuall y below our support for them . We must therefore work to establish a balance o f interest . This might best be done by gentle reminders at critical stages b y members of our leadership . . . " "On 27th . June, I had a very frank and friendly discussion with Boyk o Demitrov - the former Bulgarian Ambassador to Grenada who is now Director o f International Relations in the Party . He told me that . . .Grenada has to fac e the reality that [FP : to the Soviet Union] it is a question of size , distance, and priorities . I think that he is correct . But we have to dea l with these realities . In order to elevate our priority in the socialis t scheme of things . . . we have to raise and discuss with the highest authorities, global and regional issues rather than parochial or nationa l issues . In other words, our legitimate begging operations have to be cast i n the larger world context . We have in fact done this in the past quit e successfully, linking our national requests to a global analysis . What we need to do now, it seems to me, is to become the spokeman for a broade r constituency - perhaps the countries of socialist orientation . " In an undated memorandum he also wrote : "The Caribbean . . .is, frankly, not one of their priority areas and thi s is reinforced by their interest in reducing the areas of conflict with th e USA . Furthermore, the CPSU [FP : Communist Party of the Soviet Union] ha s been historically very cautious in developing relations with parties whic h are new to them . " Although scholarships and military grants were forthcoming, it wa s difficult for Grenada to obtain much economic aid from the U .S .S .R. With regard to agriculture the Soviets noted that their aid efforts in mechanize d tropical agriculture had not been very successful and had resulted in a los s of prestige ;

therefore, they recommended that the Grenadians try the

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Bulgarians and Hungarians for such aid . They also refused to help with the design of buildings, noting that the USSR generally built much large r buildings than those requested by the PRG ; and they also recommended th e Bulgarians for this task . They said that it was not their practice to give free technical assistance and that they didn't want to set any precedents wit h Grenada . In Coard's 1980 trip to the USSR they insisted on paying world marke t prices, rather than subsidized prices, which might benefit Grenada . They further stressed that the Soviet bureaucracy needed a great deal of time t o study various aid requests . Still later in a visit to Greneda in December 198 2 the Soviet Deputy Chair of Gosplan, Nikolai Lebedinskiy, exphasized th e importance of trade, not aid, and that such trade should be carried o n "without any grant element ." He appeared well aware of Grenada's realizatio n that the major source of Soviet aid to Cuba was through subsidized suga r prices . Other aspects of this visit are discussed below . In 1981, 1982, and 1983 the Soviet Union did make several small grant s for economic purposes, but these amounted to only EC $ 7 million (US $ 2 . 5 million) . The Soviets did not appear interested in helping to finance th e airport and they seemed to respond slowly to the PRG's perceived economi c needs, for instance, in July 1983 they turned down a Grenadian emergenc y request for a US $6 million loan or grant on the bizarre grounds that the y heard France was going to make such a grant, a claim which appeared totall y baseless . Moreover, they seemed unmoved by Grenada's suggestion in 1983 for a COMECON counterpart to the IMF which would make loans to countries with

a

socialist orientation . In an internal memorandum Richard Jacobs noted dryl y that since such a bank would probably cost the Soviets about US $20 billion , it might be best to approach the matter through other socialist countries . Nevertheless, the Soviet Union did send a series of missions to Grenad a (e .g ., in late 1979 and again in 1982) and they also established an embassy on

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the island . By 1983 Soviet interest had finally been seriously aroused : at the time of the intervention, 49 Soviet diplomats and advisors, headed by a three 11 / star general, were on the island .— In sum, Grenada was a political plum which unexpectedly fell in the lap of the Soviet Union and it took the m considerable time to appraise its worth . b . European Socialist Nation s According to a high ranking member of the PRG's Foreign Ministry , the government was quite surprised to find itself being wooed by the Germa n Democratic Republic . Both before and after the coup Grenada may well have bee n the focus of a certain amount of G .D.R . intelligence gathering efforts, whic h 12/ served as a prelude to such aid .— The G .D .R.'s motives for giving Grenad a such attention are not clear, but G .D .R . interest started with Coard's 198 0 trip to Eastern Europe . We can conjecture that Grenada provided the G .D.R. with a relatively inexpensive means of creating a diplomatic and politica l presence in the Caribbean and Latin America outside of Cuba, although th e purpose of such an exercise is unclear . Nevertheless, such a manoever, if i t resulted in gains for the socialist bloc, might also yield the G .D.R . certain advantages in its dealings with the U .S .S .R . In any case, the G .D .R. provided Grenada with a series of grants, concessionary loans, and some technica l assistance . Nevertheless, relations between the G .D .R . and Grenada gave rise t o some difficulties . Certain aid requests for consumer goods were turned down because the East Germans refused to give any kind of grants for such purposes . A major grant of printing equipment for the PRG newspaper turned out to be

a

burden : an unidentified printer at the newspaper told me that servicin g requires a G .D .R . technician flying in from Europe since facilities for suc h repairs do not exist in the Western hemisphere ; further, many of the manuals

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supplied with the equipment were written in German or Czech, which the print ers could not read . More importantly, as I detail below, the G .D.R.'s trade and aid policies were not well coordinated and the G .D .R . foreign trade enter prises took great advantage of Grenadian incompetency or ignorance to obtai n highly advantageous import prices from the PRG and, at the same time, to sel l obsolete equipment to them . Aid from the other European socialist nations was miniscule and is no t included separately in Table 1 ; for the most part it consisted of scholarship s and small gifts . The obvious target for aid-giving was Poland since that country was the largest East European buyer of Grenadian prducts in the las t years of the Gairy regime . However, exports to Poland tapered off after 197 8 and stopped completely in 1981 ; and no aid was forthcoming . As Kendric k Radix [interview] pointed out to me, in 1979 Poland's internal politica l problems increased and the country became in no financial position to serv e either as a buyer of Grenadian exports or a giver of aid . Czechoslovakia and Hungary were also natural targets for aid, but little was forthcoming unti l some years had passed except for the sending of occasional technicians . Indeed, Bishop's trip to those two countries in September 1983 shortly befor e he was ousted and killed was to negotiate some more substantial foreign ai d agreements for 1984 and 1985 . Hungary, for instance, offered an electric powe r station and Czechoslovakia promised to send a small cement mill . I have foun d no evidence why the G .D.R . created much stronger economic ties to Grenada tha n Hungary or Czechoslovakia . Bulgaria seemed to offer Grenada considerable diplomatic advice, eve n though no significant aid was forthcoming . In a rather imaginative swap, th e two countries agreed to exchange Grenadian nutmeg for a Bulgarian iceplan t (for fish processing) . According to a highly placed PRG Foreign Ministr y official [interview], the Grenadians considered Romania as too much of a

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maverick to be worth cultivating and exercised caution with Yugoslavia sinc e it was viewed as "neither fish nor fowl" . In 1983 Coard did make som e preliminary attempts to obtain aid from Yugoslavia, but the major result wa s merely an agreement for further discussions at a later date . Apparentl y Albania was totally avoided ; in any case that nation was in no position t o offer extensive economic aid . c . The Asian Socialist Nations After 1981 Grenada went fishing for grants in the Asian socialis t world which supported the Soviet Union including Kampuchia, Laos, Mongolia , North Korea, and Vietnam . North Korea actively wooed Grenada from the ver y beginning ; and in the PRG's first foray abroad for foreign aid in the summe r of 1979, Kim il-song received the group in person . The purpose of thi s interest is puzzling . A highly placed PRG Foreign Ministry official suggeste d to me that perhaps this divided nation (similar to the G .D .R .) also saw a n inexpensive opportunity to overcome its diplomatic isolation in the Wester n hemisphere . North Korea also seems to be focusing its diplomatic attention o n obscure countries ignored by others, e .g . witness its significant presence i n Madagascar . It is also possible that since Gairy was so friendly to the Sout h Korean government, the North Koreans felt a natural affinity to the PRG . In any case, three members of the Political Bureau, Hudson Austin, Selwy n Strachan, and Maurice Bishop made separate visits to North Korea and obtaine d not only a U .S . $12 million grant of military equipment but also the promis e to build a stadium in St . George's and assistance on a number of othe r projects as well . The Grenadians appeared quite ignorant about conditions in North Korea . When Hudson Austin, the head of the army returned home in September 1983 fro m a trip in North Korea, we smile in reading the Central Committee minutes that

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he "was surprised to see how deep the personality cult was in Korea, where th e leader is worshiped almost as a God ." However, the North Koreans apparentl y invested considerable emotional energy into Grenada :

after the U .S .

intervention, Western reporters in Havana greeted the plane bringin g expelled foreign diplomats to Cuba and noted not only the Cuban diplomats wit h their clenched fists raised defiantly in the air but also the 15 North Korean s (apparently mostly engineers) weeping into their handkerchiefs . Grenadian relations with the other Asian socialist nations were not ver y significant, Vietnam gave a symbolic gift of military equipment ; Mongolia an d Grenada exchanged delegates to conferences held in the two countries ; the PRG planned to send a delegate to the Loas Party Congress . As noted above, Grenad a avoided China diplomatically ; and it is noteworthy that the small amount o f Grenadian exports between the two countries ceased after 1979 . Curiously, the small amount of imports Grenada received from China continued . d . Cub a Cuba's major support of Grenada consisted of the EC $ 82 millio n (U .S . $30 million) for the airport, given in the form of both manpower an d equipment . But Cuba also gave EC $ 17 .0 million for other projects . At th e time of the intervention there were about 784 Cubans on the island, of whic h about 636 were working on the airport, 22 served as military advisors, 1 7 worked as physicians and dentists, and others worked as teachers, advisors t o the Ministry of Interior, and other governmental bureaus . The Cuban aid was said to be given without strings and was particularl y helpful to the PRG since it was continuous, responsive to the PRG's needs o f the moment, directed at a variety of problems, and given as grants . In reading the minutes of the NJM Political Bureau or Central Committee, I was impresse d at how the preferred solution to many small technical problems was to call o n the Cuban comrades in the same manner as a hesitant child calls upon his

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parents to help at every moment of unforseen difficulties . The 1982/83 ai d agreement detailed 196 different projects including piano tuning training an d instruction in table tennis . A particularly bizarre instance of Grenada' s dependency on Cuba occurred in mid 1983 at the time the Cubans cut off th e telephones and electricity of the Grenadian embassy in Havana when it had no t paid its bills to the utility company, an event which raised anger in th e Grenadian Political Bureau . This rather pointed message by the Cubans did no t prevent the Political Bureau at the same time from asking Cuba for grants fo r a) construction of a power plant ; b) bridge repairs ; c) 30 miles of roads ; d ) farm and feeder roads ; e) water resource development and a hydroelectricit y plant ; f) civil engineering work for a satellite disk (donated by th e Soviets) ; g) civil engineering work for the Bulgarian ice plant ; h) a nationa l convention center ; i) construction of a quarry ; j) an aquarium . Very often i t seemed that the Cubans responded affirmatively to such heterogeneous requests . As far as I can determine, the Cubans had made few extraordinary counter demands on the Grenadians . They did, of course, keep a close eye on the Grenadaians and, it is alleged (by Lloyd Noel) that in the first few years o f the revolution the Cuban ambassador attended cabinet meetings . Further, th e Cubans had placed technicians in some key ministries (e .g ., planning) . In an y case, the PRG appeared most willing to coordinate its foreign policy effort s with the Cubans and to draw lessons from "the Cuban experience ." Although th e Cubans occasionally manifested displeasure with the course of Grenadia n events, e .g ., especially during the summer of 1983, for the most part the y tried hard to maintain their role as a wise and generous uncle wit h considerable tolerence for an occasionally unruly nephew . 4 . A Perspectiv e Several aspects of this aid from other socialist nations to Grenada

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deserves brief mention for it provides perspective on the entire range o f Soviet bloc aid to third-world Marxist nations . First, such aid appeared to be loosely coordinated among the variou s countries, at least from 1982 onward . The Grenadian ambassador from Mosco w sent a coded message home in January 1982 saying that the G .D .R . ambassado r and "some Cubans" told him some very good news : in the recent meeting of al l General Secretaries of socialist nations (apparently just those nations allie d with the USSR attended), Leonid Breznev announced that the Soviets were going to give Grenada a "generous package" and that what the Soviets didn't supply , the other nations would when Grenadian aid teams visited them . Even mor e intersting is the fact that the Soviets did not

supply Grenada with

a

"generous" package when Bishop visited the USSR later in the year ; and that aid from the other socialist nations appeared to be on the same hit-or-mis s basis as before . This can be interpreted in three ways : (i) either that th e mechanisms for following up decisions made at this high level meeting were no t effective ; (ii) or that the Soviets changed their mind after the meeting ; (iii) or that they decided to postpone any decision until a high-ranking official such as Lebidinskiy made a careful study of the island . Althoug h the first interpretation seems more likely to me, no solid evidence exists fo r any certainty on the matter . In any case, from the archival material s available, the relations of the Soviet bloc nations with Grenada appeare d quite separate and no evidence

is

available that particular nations such a s

the G .D .R . were "assigned" to help Grenada ; indeed, Cuba's intercession t o Moscow in Grenada's behalf, especially before 1982, suggests that thes e nations were acting quite independently . Second, with the major exception of a loan for East German telephon e equipment, these nations gave their aid in the form of grants or short ter m trade credits . The provision of technicians and of scholarships were

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particularly preferred . Third, a number of technical problems in such aid arose . Some of th e equipment was outmoded (e .g ., some of the military equipment or the Eas t German telephone system) . Some equipment that arrived without sufficient spar e parts (e .g ., in April 1983 Bishop complained to Gromyko that only one tenth o f the Soviet military vehicles were in operation because of lack of spar e parts) . Some equipment rapidly broke down and became useless (e .g ., Cub a donated 10 ferro-concrete fishing boats ; their engines were too weak to powe r the boats and had to be replaced, several sank, and only one remained i n operation after several years) . It is also worth noting that such aid did not come without certain cost s to Grenada . The entire aid program severely overtaxed the Grenadia n administrative bureaucracy . Many grants were incorrectly specified so that Grenada received equipment which it could not use or did not need . Further , when aid was not forthcoming at the expected time, the PRG found itself i n severe financial straits, especially in the summer of 1983 . There were als o certain political cost of clientism and, for instance, Grenada's vote with th e Soviet Union on the Afganistan issue was received quite negatively from man y potential supporters in the Caribbean area . Finally, the constant focus o n foreign affairs led to a considerable neglect of domestic economic problems . Foreign affairs seemed a much more interesting occupation than more mundan e aspects of economic management . The top party leaders were quite aware of thi s neglect and registered their concern from time to time, but nothing was don e about it and top NJM leaders appeared quite willing to leave most suc h economic matters to Bernard Coard, who was able to consolidate his politica l power in this fashion .

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13/ E . Technical Assistance- 1 . Plannin g The PRG had close contacts with a number of socialist nations and, i n 1983, both Cuban and Soviet technicians were aiding the PRG's economi c planning process . In a number of interviews (including Bernard Coard, the Minister of Planning, as well as several of his subordinates), I asked abou t the type of economic advice which the PRG received and in all cases I wa s informed that with one exception (discussed below) the advice was of

a

technical, rather than a strategic, nature . For instance, I was told that th e Cuban economist working in the Ministry of Planning, Fernando Diaz, spent mos t of his time developing information systems for the introduction of a materia l balance type of planning system . All of this information about foreign advic e and advisors was, however, quite vague . However, the available documentar y evidence only allows us to have a glimpse of the type of advice given to th e Grenadians just by the Soviets and the Czechoslovaks . In December 1982 the Lebidinskiy mission of Soviet economists arrived fo r a series of meetings with PRG officials . According to the minutes of thes e meetings, the Soviets responded cautiously to the enthusiastic plans of th e Grenadians and spent most of their time asking intelligent and sobe r questions, primarily about details . For instance, they questioned th e advisability of Grenada's planned expansion into citrus fruits because o f possible competition with Cuba and suggested coffee as a substitute product ; the Grenadians replied that they had cleared their plans with the Cubans . They also advised the Grenadians to continue their exports to capitalist countries as much as possible . The Soviets replied to the PRG's boast that they woul d practically eliminate unemployment in the next few years with a little lectur e about the mechanism underlying what bourgeois economists call the Phillip s curve and how such a policy might increase the inflation potential! (It is

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also noteworthy that they seemed to accept exagerated PRG claims abou t unemployment reduction .) They also emphasized strongly the necessity o f keeping rigorous financial and statistical records . In sum, in this series o f meetings the Soviets seemed to offer practical, not strategic advice, althoug h at one point in the conversation they did suggest it was unwise to stres s industry too strongly "because of the marketing problem . " In contrast, the Czechoslovaks gave very explicit advice for the long term . In 1982 Jiři Čerhonek, an economist from the Czechoslovak Ministry o f Planning on loan to the Macro-Planning Unit of the Grenadian Ministry o f Planning, wrote a fascinating memorandum outlining a strategy of developmen t for the next three years . Although it ostensibly covered only the immediat e future, it had important longer range implications . Čerhonek approach was to diversify the economy and to implement a n import substitution policy primarily in manufacturing . He focused almos t completely on industrialization and urged investment in manufacture of good s with the following characteristics : high labor intensivity of production ; not produced in the surrounding island states ; high income elasticities ; low material consumption ; and short pay-out times so that the initial investmen t could be rapidly recovered . He specified electronic components, agro-industry , plastics processing, wood and waste-paper processing (including furniture) , woven carpets, shoe industry, garment production and construction materials . With regard to agriculture he suggested only the introduction of tobacco an d for other sectors his remarks focused more on the necessity of prope r maintenance of existing productive facilities, rather than radical changes i n investment policy . Although some of his import substitution ideas parallele d those of the PRG, Čerhonek approach was very different from the strateg y outlined by Bishop ; in many important respects it made an almost full circle

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to the advice given by Arthur Lewis (the West Indian economist and futur e Nobel lauriate) to the Caribbean nations as a whole in 1950 when he told the m that labor intensive light industry was their only hope for economi c 14/ development . — One Grenadian official [interview] made the interesting suggestion tha t the Cernonek memorandum was essentially Coard's Trojan horse to reverse th e development strategy set by Bishop in the "line of march" speech . This appear s unlikely because Coard's political weight was preponderantly on economi c matters and, in his capacity as Minister of Planning, he was undoubtedly th e major architect of the "line of march" approach . When I discussed th e memorandum with Coard [interview, February 1985] and pointed out that it ra n contrary to Bishop's approach, Coard denied it . He said that the memorandum was merely useful input for the NJM's thinking about the long-term . In othe r words, he rejected the short-term thrust of memorandum, which downgraded th e PRG's emphasis on tourism and agriculture, and took Čerhonek advice as a se t of guidelines for the third phase of the 15 year plan when the island woul d begin to industrialize . I found no evidence that any ally had given the Grenadians advice abou t nationalization of private property or collectivization . I doubt whether suc h advice would have been followed, if it had been proffered, since the NJM had a clear agenda on these matters . The instances discussed above suggest that the PRG had clearly set it s own course and, although it listened to the advice of others, it did not fee l obliged to follow such guidelines . Although Grenada's relationships with Cub a were much closer than with the USSR or Czechoslovakia, it seems likely to m e that they maintained the same independence . 2 . Specialist s Quite early after the coup Cuba gave Grenada the services of about a

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dozen doctors and dentists, which increased the number of such medica l specialists almost by half . Of particular importance, they were sent to part s of Grenada which were lacking in medical personnel, e .g ., the islands o f Carriacou and Petite Martinique, two small islands belonging to Grenada whic h had no permanent physicians . This increase in health inputs was perhaps th e most important move in the field of health which the PRG made, for althoug h they declared health care to be of primary importance, budgetary resource s devoted to this purpose did not seem to increase during the Bisho p 15 / Proof of the popularity of this program is seen in a publi c government .-opinion poll taken shortly after the military intervention, which showed tha t about one of seven Grenadians believed that health was the area in which th e PRG did most for the nation (it followed education and the building of th e airport) . For a wide number of specific projects Cuba sent specialists to mak e surveys, give advice, or implement particular policies . This was part of

a

much larger effort by Cuba which is said to maintain about 16,000 teachers , doctors, construction engineers, and other aid workers in 22 third worl d 16/ .S nations, a program roughly three times larger than the U . Peace Corp .-The Soviets, in contrast, did not seem to send many individual specialist s until 1983, when two planning specialists and twelve miitary advisors wer e posted in Grenada . 3 . Othe r A number of Soviet bloc countries gave scholarships to Grenada and PR G officials frequently mentioned that 350 Grenadians were studying abroad o n these programs . For the most part these seemed to have been short specialize d courses, although the U .S .S .R . did give a number of multi-year scholarships for studying at Soviet universities . In fact, Grenada had more scholarship

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offers than they could fill and, as far as I was able to find out, the offer s from Bulgaria and several other countries were not filled at all . 17/ D . Trading with the Soviet Bloc-Trading relations between Grenada and the Soviet bloc can be seen mos t easily in Table 2 below, which presents data on the geographical distributio n of exports and imports . During the period from 1978 through 1983 Grenad a experienced considerable difficulties in its trade with the West for tw o reasons : its currency was tied to the dollar, which was rising vis-a-vis the European nations with which Grenada had the greatest amount of trade ; further , the terms of trade were falling about 25 percent, a set of circumstances du e not only to the oil price rise in 1979 but the relative decline in prices o f some of Grenada's most important exports such as nutmeg . As can be seen from the table, Grenadian exports to the Soviet bloc di d not greatly increase . Although imports did rise, these reflected the tie d grants which Grenada received from these nations . The materials from th e captured archives reveal some interesting strains in Grenada's attempts t o increase its trade with its new socialist allies . 1 . Sales As noted above, Bernard Coard's 1980 mission to the USSR to obtain

a

trade agreement was unsuccessful . In 1981 the PRG announced in its newspape r that a trade agreement with the Soviet Union had been signed and that th e U .S .S.R . would henceforth purchase Grenadian nutmeg ; however, this agreemen t later turned out to be a relatively meaningless "trade protocol" and covere d 18/ only some short term trading deals .- In preparation for more serious trade negotiations in late 1982, the PR G position papers reveal that they wanted to sign five year agreements to expor t yearly annually 500 tons of nutmeg (about one fifth of Grenada's annual crop),

GRENADA

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a/ Table 2 : The Foreign Trade of Grenada with Socialist Nations- (millions of current EC dollars ) 1977

1978

1979

1980

1981

1982

198 3

36 .90

44 .34

55 .61

45 .51

50 .28

47 .75

48 .46

(2 .08)

(1 .53)

(1 .74)

(0 .70)

(0 .19)

(1 .95)

(2 .91 )

1.29 0 .00 0 .00 0.00 0 .79 0.00

0 .31 0 .00 0 .00 0 .00 1 .22 0 .00

0 .67 0 .00 0 .00 0 .00 1 .07 0 .00

0 .00 0 .22 0 .00 0 .00 0 .48 0 .00

0 .00 0 .19 0 .00 0 .00 0 .00 0 .00

0 .00 0 .11 0 .09 0 .02 0 .00 1 .73

0 .00 0 .42 0 .00 0 .00 0 .00 2 .49

Export s All nations Socialist nations of which : China Cuba Czechoslovakia G .D .R . Poland U .S .S .R . Import s 87 .29

96 .45 117 .98 135 .57 146 .71 152 .42 154 .48

Socialist nations of which :

(1 .60)

(2 .05)

(2 .73)

(4 .37)

(7 .99)

Bulgari a China Cuba Czechoslovakia G .D .R. Hungary North Korea Poland Romania U .S .S.R . Yugoslavia Unspecified

0 .00 0 .47 0 .23 0 .30 0 .13 0 .18 0 .00 0 .13 0 .00 0 .09 0 .00 0 .07

0 .00 0 .47 0 .72 0 .21 0 .07 0 .11 0 .00 0 .33 0 .00 0 .04 0 .00 0 .10

0 .0 0 . 0 .62 1 .39 0 .21 0 .07 0 .09 0 .00 0 .20 0 .00 0 .08 0 .00 0 .07

0 .00 0 .66 2 .74 0 .26 0 .10 0 .12 0 .00 0 .12 0 .00 0 .26 0 .00 0 .11

0 .00 0 .31 2 .74 0 .22 0 .27 0 .07 0 .00 0 .12 0 .00 4 .16 0 .00 0 .10

Total

(8 .65) (21 .47 )

0 .00 0 .66 6 .67 0 .30 0 .40 0 .02 0 .00 0 .12 0 .00 0 .30 0 .00 0 .09

0 .03 1 .05 4 .0 2 0 .2 1 15 .7 5 0 .1 3 0 .1 0 0 .0 9 0 .0 2 0 .1 8 0 .02 0 .00

a . The data come from Grenada, Central Statistical Office, Annual Diges t of Trade Statistics 1982 (St . George's : 1983) plus data supplied by the CSO . The 1983 data are preliminary . These data also do not include roughly $ EC 2 7 million and $ EC 20 million imports from Cuba respectively for 1982 and 198 3 for construction of the airport which are not included in the officia l statistics . 2 .7 EC dollars (East Caribbean dollars issued by the Eas t Caribbean Currency Authority) equals one US dollar during the period .

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1000 tons of cocoa, and 10,000 tons of bananas . However, only the five yea r nutmeg contract was signed although the Soviets also bought some Grenadia n cocoa on a short term basis . At that time Nikolai Lebedinskiy, the Deput y Chairman of Gosplan, told the Grenadians that he didn't have enoug h information on Grenada to make any more decisions . The minutes also recor d that "he would see what possibilities [FP : for trade] were available . He however noted that these things were not decided upon [as] quickly as the y should ." Czechoslovakia also agreed to start importing 80 tons a year o f Grenadian nutmeg for five years . (After the intervention the Soviets and th e Czechoslovaks quietly stopped honoring their nutmeg agreement with th e 19/ Grenadian government .-- ) More disappointments to the PRG occurred becaus e the other socialist nations also proved unwilling to import any larg e quantities of Grenada's agricultural exports . Importing relationships with other socialist nations also raised some ne w problems . In certain cases spare parts were difficult to obtain for equipment already imported . In other cases the PRG imported goods which were no t suitable for Grenadian conditions and the large order for telephone equipmen t which Grenada placed with the G .D .R . illustrates some of these problems . The Grenada Telephone Company (Grentel) had been discussing plans in th e late 1970's to buy some new digital (i .e ., all electronic) switching equipmen t from Continental Telephone Company in the U .S . (which was part owner o f Grentel) . After Grentel was nationalized the Grenadians started negotiating with the G .D .R ., originally to buy a digital system and later to buy a cross bar (i .e ., mechanical) switching system instead . A Grentel enginee r [interview] said that the digital system costs about 35 percent more ; however , the equipment is much smaller and, therefore, the building costs for housin g the equipment - which are significant - are less . He further noted that digital system requires less maintenance and, in addition, is

a

much more

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flexible when the system is expanded . According to Lyden Ramdhanny [interview], a former PRG cabinet minister, there was considerable dispute i n PRG policy circles about what system to buy . However, Bernard Coard doggedl y argued that the cross-bar system should be purchased because Grenada coul d obtain very advantageous credit terms ; and he finally had his way . Since Coard knew enough economics to recognize the fallacy of this type of argument , it is possible that other factors were involved which he did not want t o discuss, e .g ., that the G .D .R . tied certain political agreements to th e purchase of such obsolete equipment . In any case the incident create d considerable ill-will . Jose L . Mestrar, a foreign trade consultant (apparently Cuban) to the PR G read the various trade contracts which the Grenadians had signed with variou s Soviet bloc countries and suggested that Grenada stop importing on short ter m credits various products from Eastern Europe and, instead, exchange thei r agricultural produce for these goods . Like all good advice, it was easier sai d than done . 2 . Prices The pricing of goods in Grenadian trade with other socialist countrie s raised considerable difficulties . The most curious misunderstanding occurre d in December 1982 when a Soviet trade mission visited the island . According t o an undated memo by Coard, they "quietly" approached the nutmeg cooperative , rather than the state ; further, they offered US $1500 a ton when the worl d market price was supposed to be U .S . $ 1950 . In his memo Coard appeared to be extremely angry at such underhanded manoevers ; however, the real story can b e interpreted in a somewhat different and more interesting way . From 1980 onward, the price which Grenada had received for its nutmeg had

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been falling and by the arrival of the Soviet trade mission the Nutmeg Co operative had considerable unsold inventories . According to Veda Gitten s [interview], Executive Secretary of the Grenada Co-operative Nutme g Association, the Grenadians charged the Soviets the world market price and , further, agreed to renegotiate the price every year so that the price whic h the Soviet Union paid would follow the world market price . In actuality , according to Grenadian trade statistics, the Soviets paid a premium over th e price which non-socialist buyers paid of 51 percent in 1982 and 58 percent i n 20 / 1983-- . Similarly, the Cubans paid a 32 percent premium for nutmeg in 198 2 and a 42 percent premium in 1983 ; and the G .D .R . paid a premium of 59 percent in 1983 . No nutmeg was purchased by socialist nations in 1981 ; in 198 0Cuba had paid a premium of 15 percent and Poland, 3 percent . Given the fact that the Soviets wanted to pay world market prices, ho w could this have arisen? A certain part of the premium can be traced to th e fact that in these later years Cuba, the G .D .R . and the U .S .S .R . apparentl y negotiated nutmeg prices a considerable time in advance of actual deliver y 20 / when the general world market price was lower-- . However, it also seem s likely that a discrepancy existed between the nutmeg co-operative's state d belief about the level of the "world market price" of nutmeg and the "actual " price It is worth noting that the international nutmeg market is very thin an d specialized since there are only two major world exporters and most countrie s such as the USSR generally buy their nutmeg semi-processed from middlemen fro m the Netherlands and, as a result, are not completely aware of the "worl d market" price) . Price premia for other Grenadian exports, which were fo r products with a well-defined world market price, were very much smaller . I n any case, I suspect that Coard's anger about Soviet buying tactics may have been due either to his misunderstanding about the world market price of nutme g or to a tactical manoever to change the institutional structire of Grenadian

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GRENADA

foreign trade so that more trade, particularly with the Soviet bloc, would b e carried out through the state foreign trade enterprise, the National Marketin g and Importing Board . More

illumination about Grenadian pricing practices can be gained from

a

brief glance at cocoa sales . In 1983 Grenada delivered to the Soviet Unio n some cocoa at a 12 percent premium over the price which they received fro m other buyers . Since the world market price of cocoa is well known, thi s appears surprising . However, according to Norbert Arnold [interview], the former secretary of the Grenada Cocoa Association, the GCA asked this highe r price because "we felt that as an ally, they would be willing to pay more" ; surprisingly, the Soviets did not appear to bargain very hard . Grenada had a much different experience in negotiating a price fo r bananas with the G .D .R . The German's had been talking with the PRG for som e time about buying bananas, but they wanted to purohase a different kind o f banana than Grenada grew which, it should be noted, cost less but was muc h more difficult to ship . According to Norbert Baptiste [interview], Secretar y of the Banana Cooperative Society (BCS), in 1982 Grenada was selling banana s at 48 cents a pound . While on a visit to the G .D .R . George Louison, a membe r of the Political Bureau and the PRG Minister of Agriculture, negotiated a n arrangement whereby the G .D .R . would buy these bananas at 19 cents a pound ! After learning about this agreement, the BCS registered its dismay and the PR G obtained a new offer of 24 cents a pound, an amount which was about equal t o the Board's handling cost and which would leave the banana farmers wit h nothing . At this point the BCS rejected the entire deal . This incident has several curious aspects .

First,

Louison was the onl y

member of the NJM leadership with any experience in agriculture but he wa s apparently thinking in terms of the farm-gate price of bananas and did not

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take into account the cost of their delivery to the port, which about equal s the farm-gate price ; or else he got confused about which type of banana was t o be sold . In any case, it does not appear that his staff preparation for thes e negotiations was adequate .

Second, the BCS generally sold its own bananas an d

it appears peculiar that Louison would take it upon himself to negotiate suc h an agreement, especially since some technical matters such as shippin g arrangements are so important for bananas .

Third,

the G .D .R .'s offer was s o

insulting that one wonders why it was made in the first place since it wa s bound to cause friction .

Finally,

the G .D .R . did not permit Grenada to bac k

out of the contract since they were going to pay for the bananas in part wit h agricultural inputs such as fertilizer . At the time of the militar y intervention, Louison was engaged in working out a program to nationaliz ea number of estates in order to produce the bananas to meet this contract whic h the private producers had refused to do . Grenada seems to have paid reasonable prices for its imports from th e other socialist countries . From a computer print-out of Grenada's 1983 trad e on a very detailed basis, I selected 15 homogeneous items and computed averag e unit prices for socialist and non-socialist nations . For the items I chos e there was not sufficient difference to warrant a more thorough investigation .

H . Some Conclusion s Before the Grenadian experience can be placed in context, it is useful t o review on an aggregative level the experience of other third world Marxis t nations in their economic relations with the Soviet bloc . 1 . Soviet Bloc Relations with the Marxist Third World as a Whol e Table 3 below presents some data on trade and aid of all third worl d Marxist regimes or nations which the Communist Party of the Soviet Unio n designated in 1980 to have a "socialist orientation . " Although the data on direction of trade leave something to be desired, it

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a/ Table 3 : Some Data on Trade and Aid : Annual averages, 1980 through 1983- "Official" status

Share of trade with "core" Marxist regimes Exports Imports

Foreign aid committment s for economic purpose s Total Per capit a (million $) ($ ) All CMEA All CMEA

Third world Marxist regimes : Afganistan Angola Benin Cape Verde Congo Ethiopia Grenada Guinea-Bissau Madagascar Mozambique Nicaragua Somalia PDR Yemen

SO,V SO,V SO,V SO,RD SO,V SO,V SO, (RD) SO,RD SO,RD SO,V SO, (RD) SO,V

52% n .a . 0 0 0 8 3 8 4 n .a . 5 2 0

27% n .a . 4 1 2 29 7 15 3 n .a . 0 4 2

333 183 117 n .a . 54 397 14 81 313 336 392 495 291

318 2 1 n .a . 10 75 9 2 13 57 176 0 140

14 15 26 0 33 0 n .a . n .a . 35 7 12 2 153 10 1 142 4 36 1 32 5 143 64 136 0 148 71

Other third world nations with a "socialist orientation" : Algeria Burma Guinea Sao Tome Seychelles Syria Tanzania

SO SO SO SO SO SO SO

2 6 n .a . n .a . 0 30 6

7 14 n .a . n .a . 3 16 4

635 445 183 n .a . 29 1465 768

0 6 0 n .a . 1 14 3

34 13 37 n .a . 478 170 43

0 0 0 n .a . 12 2 0

Total a . Designation of "Marxist regimes" : Bogdan Szajkowski, The Establishmen t of Marxist Regimes (London : 1982) . The data refer to 1980 . To his list I have added Madagascar and Nicaragua . Status :

SO designates whether the nation has been specified by th e

Communist Party of the Soviet Union (CPSU) as a nation with a "socialis t orientation ." V and RD designate respectively whether the CPSU has specifie d the ruling party as a vanguard or revolutionary democratic party . For Grenad a and Nicaragua, such designations are by inference . These classifications com e from Wallace H . Spaulding, "The Communist Movement and Its Allies," in Ralp h Continued on next pag e

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Table 3 continue d M . Goldman,

Transnational Parties : Organizing the World's Precincts (Lanham ,

Maryland, : 1983), pp . 25 - 60 . Core

Marxist regimes :

these include the CMEA nations (Bulgaria, Cuba ,

Czechoslovakia, the German Democratic Republic, Hungary, Mongolia, Poland , Romania, U .S .S .R., and Vietnam) plus Albania, China, Kampuchea, DPR Korea , Laos, and Yugoslavia . Export and import shares : the data come from International Monetary Fund Direction of International Trade,

,

1984 Yearbook (Washington, D .C . : 1984) . Fo r

Grenada, the data come from Table 2 . Despite the source, these data are quite rough . For all third world nations the average export and import ratios are 6 and 7 percent respectively ; and for non-oil exporting developing nations ar e 10 and 8 percent respectively . Grants and loans : The data come from : O .E .C .D ., Geographical Distributio n of Financial Flows to Developing Countries (Paris : 1984) . The data for Grenad a represent actual aid flows and come from Table 1 . These data are usuall y somewhat higher than those presented by the CIA, National Foreign Assessmen t Center,

Handbook of Economic Statistics, 1984 (Washington, D .C . : 1984) ; It i s

possible that they may also contain certain military aid as well .

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appears that the nations listed in Table 3 had no greater trade with the "oor e Marxist regimes" (i .e ., the CMEA nations plus China, Laos, Vietnam, an d Kampucheia) than other third world nations . More specifically, the nations i n the table sent about 6 percent of their exports to the "core Marxist regimes " and, in turn, received about 9 percent of their imports from this area . Fo r other third world nations, these peroentages are respectively 6 percent and 7 22 / percent .-- The difference in imports reflects the trade financed by foreig n aid from the CMEA nations to the nations with a socialist orientation . In an y case, the difficulties Grenada had in trying to increase its exports to th e Soviet bloc were not unusual and reflect the unwillingness of these countrie s to increase their imports from the third world, given their general scarcit y of hard currencies . Other studies of third world Marxist regimes have als o shown that trade relations between these countries and the Soviet bloc are no t 23 / great .-Data on foreign aid of the Soviet bloc for economic purposes sho w considerable discrepancy between sources ; the O .E .C .D . data used in the tabl e are generally greater than estimates of the U .S . government on these matters . Further, the most readily available data focus on aid commitments, rather tha n actual aid sent, and thus introduce another uncertainty . (For Grenada, data on aid commitments do not exist, so actual aid flows are used instead) . A glance down the total aid commitments for economic purposes given t o all third world nations reveals that, on an annual per capita basis, the to p five aid receivers in the four years from 1980 through 1983 were : Jorda n 24 / ($416), Vanuatu ($368), Surinam ($288), Grenada ($270), Kiribati ($243) .- If the data for Grenada were comparable and would have included total ai d committments, then average per capita economic aid for the four year perio d would have been roughly $350 . It is noteworthy that all of the top five aid receivers on a per capita

12/31/85

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Page 5 0

basis are nations with very small populations (as were the next five, whic h are not listed .) Further, CMEA bilateral aid is quite concentrated : about 5 9 percent is given to the 20 nations with a socialist orientation and the bul k of the remainder was given to India and Bangladesh . Table 3 reveals one extremely important additional factor : that the bilateral aid given by th e CMEA nations constitutes only a small fraction of the total aid these nation s received, the three exceptions being Grenada, Nicaragua, and South Yemen . Grenada "ranking" among the top aid receivers reflects both the generosity o f Cuba and its successful strategy of search for foreign aid . Indeed, i n examining Table 3 one is struck by the meagerness of CMEA bilateral aid : eve n long—standing Marxist regimes such as the People's Republic of the Congo hav e received most of their aid from the West . In sum, the Soviet bloc gives few trade concessions and, further , relatively small amounts of economic aid ; they are able to hold their thir d world allies rather inexpensively . Military aid is considerably mor e 25 / important than such economic aid-- and appears to be highly concentrated i n a few countries . Such military aid, in turn, may provide the leverage by whic h the U .S .S .R . has been able to maintain discipline among its allies in variou s international forums, e .g ., voting against (or abstaining from voting) th e U .N . resolutions condemning the U .S .S .R . for its invasion of Afganistan o r Vietnam for its invasion of Kampuchea . It is only maverick Marxist regime s (e .g ., those siding with China against the U .S .S .R . or those wishing Wester n aid against some enemy such as Somalia) which have not followed the Sovie t Union in these matters . 2 . A Perspective on Grenad a Unlike most third world Marxist nations, Grenada was able to obtai n considerable amounts of foreign aid from the Soviet bloc . As I have shown, the

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GRENADA

aid which Grenada received on a per capita basis was very high . It i s noteworthy, however, that the largest share of this aid came from Cuba an d that the Cuban-Grenada connection came a considerable time before the Sovie t Union became serious . Although Soviet military aid (which was secret) wa s forthcoming in 1980 and in the following years, Soviet economic aid wa s niggardly, and two reasons can be conjectured : First, they did not want t o rile the United States by developing unnecessarily close relations with

a

nation close to its shores . Second, they preferred to let Cuba carry the brun t of the aid, especially since Cuba had more experience in dealing wit h ' Caribbean conditions . Nevertheless, I find it curious that the Soviets did not send mor e technicians at an earlier date, especially to help set up statistical and accounting systems which would permit the Grenadians to organize their eoonom y more efficiently ; the sending of 16 science teachers in the fall of 1983 ma y have been an experiment to establish a Soviet "peace corps" ; however , technicians who were trained in fields more oriented toward production migh t have been considerably more useful to the Grenadians and there is no evidenc e that they would have been unwelcomed . Grenada's trade relations with the Soviet bloc show the difficulties tha t almost all third-world Marxist nations have had in increasing their exports t o Eastern Europe . With regard to pricing, two lessons can be learned from thes e various incidents .

First,

as many, including the philospher Hegel, hav e

pointed out, a client can have power over his patron and the premiums whic h the Grenadians extracted for their exports to the other socialist nations i s an interesting example, especially since the Soviet Union explicitly claime d they wanted to trade at world market prices .

Second,

it is possible tha t

trade and aid policies are not necessarily well co-ordinated in the socialis t bloc and the G .D .R .'s treatment of Grenada with regard to bananas and

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Page 5 2

telephone systems illustrates this point . A more cynical interpretation o f the difficulties between the G .D .R . and Grenada is that the Germans had n o real interest in trying to help Grenada but rather, in the guise of givin g Grenada certain grants, was actually trying to realize a considerable ne t profit by selling obsolete equipment and obtaining particularly low impor t prices . Grenada's confrontational stance vis-a-vis the United States and it s diligence in various international arena in furthering Soviet bloc aims was a n important tool which it used in deepening its relations with Soviet blo c countries and radical third world nations . However, a basic contradictio n existed in Grenada's growth strategy in that the policies which yielded th e most foreign aid fruits were also those which frightened away tourist s (especially from the USA which provided by far the largest source of suc h visitors to the island) . One can not help suspecting that once it became clea r that Grenada was not developing economically very fast, once the novelty o f the new ally had worn off, and once the Soviet bloc nations saw that Grenad a had scared away tourists which were its major source of revenue , disillusionment would have occurred and foreign aid receipts from the Sovie t bloc and the radical third world would have tapered off . The year 1983 was catastrophic for the PRG in many respects . Th e government ran into serious economic difficulties in mid 1982 and was unabl e to receive the necessary foreign assistance from Soviet Bloc to surmount thes e problems . Libya, Algeria, and Syria promised $15,000,000 of aid, which did no t arrive . Although the IMF gave a loan, it required the PRG to cut back many o f its public investment programs, which led to layoffs . A group of young me n within the top leadership of the PRG, almost all of whom were members of OREL , became disenchanted with Maruice Bishop, forced a power-sharing arrangement

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Page 5 3

with Bernard Coard, placed Bishop under house-arrest when he changed his min d and refused to cooperate with Coard, and finally ordered Bishop's murder whe n the former Prime Minister had been freed by a crowd . The OREL members als o formed the core of the Revolutionary Military Government which succeeded th e PRG, they imposed a four .day shoot-at-sight curfew to obtain the time t o consolidate their power, and then they watched helplessly as most Grenadia n troops abandoned their stations when the United States invaded the island si x days after Bishop's death . By its refusal to provide emergency aid to Grenada in 1983, which woul d have been quite inexpensive (undoubtedly less than $20 million), the Sovie t Bloc essentially wrote Grenada off its ledger . In analyzing policy options o f the U .S . in dealing with third-world Marxist nations, it is imperative t o determine which are really considered vital to the Bloc's strategic purposes . Clearly Grenada did not appear very important to the Soviet Union, as th e Grenadian ambassador to that country so perceptively realized .

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Page 5 4

Footnote s * Research for this essay was financed by grants from the Nationa l Council for Soviet and East European Research and from the Swarthmore Colleg e Faculty Research Fund . To both I would like to express my gratitude and t o absolve them from any responsibility for my interpretations or errors . Materials for this essay are drawn in large part of a book-length stud y entitled

Revolutionary

Grenada,

A

Study in Political

Economy

(New York :

raeger, forthcoming, 1986) . 1.

I cite these microfiche with the designation [MF-xxxx], where the x' s

stand for the last four digit of the microfiche number (thus omitting th e "DIS-83-C" which preceeds each four digit number in the archives) . Some of th e documents in this file have also been reproduced in : Department of State an d Department of Defense,

Grenada

Documents :

An

Overview

and

Selectio n

(Washington, D .C . : 1984) (hereafter abbreviated [USSD-xxx], where the x' s signify and the document number) . 2. American

The scholarly books include : Peter M . Dunn and Bruce W . Watson, eds . Intervntion in Grenada :

Tne Implications of Operation "Urgent Fury "

(Boulder, Colorado : Westview Press, 1985) ; Jay Mandle, Big Revolution ; Smal l Country :

The

Rise and Fall of the Grenadian

Revolution

(Lanham, Maryland :

North-South Publ . Co ., 1985) ; Gregory Sandford and Richard Vigilante , Grenada : The Untold Story (Lanham, Maryland : Madison Books, 1984) ; Kai Schoen hals and Ricahrd A . Melanson, Revolution and Intervention in Grenada (Boulder : Westview Press, 1985) ; Tony Thorndike, Grenada : Politics, Economics and Society (Boulder, Colorado : Lynne Rienner Publ ., 1985) ; and Jiri and Virgini a Valenta, "Leninism in Grenada," Problems of Communism, July-August 1984, pp . 1 - 23 . 3. Sandford and Vigilante, op . cit ., pp . 54-55 . 4.

In a number of votes either Grenada, Cuba, or the U .S .S .R . abstained

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Page 5 5

or did not vote, and these constitute the difference between 100 percent an d the sum of the similar and different votes . Of the six issues in which Grenad a voted differently than the U .S .S .R ., two concerned disarmament and four deal t with budgetary and other administrative issues within the U .N . Grenada di d vote with the Soviet Union against the resolutions condemning the U .S .S .R . fo r invading Afganistan and also with the Soviet Union against the resolutio n condemning Vietnam for invading Kampuchea . These data come from United Nations Yearbook of the United Nations,

1980

(New York : 1983) and cover 170 votes i n

the General Assembly where rollcall votes are recorded . Comparisons wit h Grenada's voting record in the year before the

coup are misleading because i n

that year, Grenada participated in only about 15 percent of the Genera l Assembly's votes . For what its worth, Grenada voted the same as Cuba, th e Soviet Union, and the United States respectively in 62 percent, 60 percent , and 33 percent of the roll calls ; and it voted differently from these thre e countries in respectively 21 percent, 28 percent, and 29 percent of the rol l calls . 5. The evidence for this generalization is summarized in Pryor, op . cit . 6.

Underlying documents for this section : an account of Coard's 198 0

visit to the USSR, MF-4094, MF-4583, and MF-5177 ; PRG foreign policy goals , USSD-106 ; countries to avoid close relations, USSD-107 ; Political Burea u meeting in June 1981, USSD-54 ; shopping list for potential aid donors, MF 6885 ; the Soviet 1982 loan, MF-5178 ; MF-5177 ; Bishop's talking points t o Gromyko in his visit in April 1983, MF-4708 ; Lebedinskiy statement, MF-4094 ; Soviet rejection of an emergency loan in 1983, MF-8751 ; the proposal for a n IMF type bank of CMEA nations, MF-8342 ; report on aid conditions by th e G .D .R ., MF-4741 ; Coard's 1983 visit to Yugoslavia, MF-5179 ; Kim il-Song' s reception of the Grenadian delegation in July 1979, MF-4668 ;

Grenada's

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Page 5 6

1982/83 request to Cuba, MF-3267 ; problems of payment of utility bills i n Grenada's Havana embassy and request for more Cuban foreign aid, MF-2292 ; th e decoded version of Jacob's message about the conference of first secretaries , MF-12596 . 7.

Bernard Coard, "The Meaning of Political Independence in th e

Commonwealth Caribbean," in Conference on the Implications of Independence fo r Grenada,

Independence for Grenada : Myth or Reality?

(St . Augustine, Trinidad :

1974) . 8.

The annual GDP data (factor cost basis) are estimates based on dat a

(and extrapolations) from the World Bank,

World

Tables,

3d editio n

(Washington, D .C . : 1983) . 9.

The State Department's version of this meeting is contained in :

Sandford and Vigilante,

op . cit . ; William K . Krieg, "Grenada : The Ideology o f

Maurice Bishop, Part II," Bureau of Intelligence and Research,

Assessments and

Research Report 916-AR (Washington, D .C . : September 18, 1984) . Ortiz's own version is contained in his letter "Grenada : Before and After" The

Atlantic ,

253, No . 6 (June 1984), pp . 7-12 . 10.

The memorandum quoted extensively in the text is reprinted in USSD -

26 . The second memorandumn is undated and is found in MF-4673 . In the latte r report he also wrote of his difficulties in finding out which part of th e International Section of the Central Committee would deal with Grenada - th e Latin American bureau or the Canada - Guyana bureau . "When I enquired as to what section has responsibility for Suriname, the amused resonse was that 'n o one wants to take responsibility for Suriname' ." He noted that they had littl e respect for the communist party in Guyana (People's Progressive Party) , especially since they believed that Janet Jagan (an American) controlle d Cheddi Jagan . One of Jacob's memoranda provides a unique view of the Sovie t military aid bureaucracy while in another report [MF-4840] he detailed a

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Page 5 7

discussion with a diplomat from Somalia about that nation's fall from grac e from the Soviet Union and analyzed other aspects of the Soviet aid program . In still another memo [MF-4888] he focused on the results of Bishop's trip t o the USSR in July 1982 and why certain requests were and were not met . Jacob s was an acute observer and these documents provide invaluable source material s about Soviet diplomatic procedures and policies . They were also extremel y useful to Bishop, who crafted a brilliant appeal for aid to Gromyko during

a

visit in April 1983 [MF-4708] . The arguments in Bishop's notes are s o convincing that it is difficult to remain unmoved when reading this speech ; however, according to Grenadian notes of the conversation [MF-4845] Gromyk o maintained his cool . 11.

U .S . Department of State and Department of Defense,

Grenada : A Pre-

liminary Report (Washington, D .C . : 1983) . According to Kai Schoenhals [inter view], who met the Ambassador several times, he was a long-time Latin America n specialist whose abilities in English were limited and his knowledge o f Grenada even less . His behavior was in sharp contrast to that of the Cuba n Ambassador (whose wife was American) : the former rode around in splendi d isolation in a chauffeur driven Mercedes (the only on the island) ; the latte r drove his own Lada and often picked up school children walking to or from school . 12. Pryor, 13.

A summary of the evidence on East German espionage is presented i n op .

cit .,

Appendix A-2 : "Foreign Espionage and Sabotage in Grenada . "

Supporting documents used in this section : minutes of the 198 2

Čerhonk meeting with the Soviet technical mission, MF-4094 and MF-6826 ; memorandum, MF-5189 . 14.

Arthur Lewis, "The Industrialization of the British West Indies, "

Caribbean Economic Review, 2 (May 1950), pp . 1 - 61 .

12/31/85

15.

GRENADA

Page 5 8

Government budgetary expenditures on health and housing rose 6 8

percent over the 1978 level by 1983, but the retail price index rose 8 6 percent . No better deflator for the budgetary series is available . The data come from Pryor,

op .

cit .,

Table 6-4 . The public opinion polling data com e

from Selwyn Ryan, "Grenada : Balance Sheet of the Revolution," paper presente d to the Conference on Grenada, Institute of International Relations, Universit y of the West Indies, St . Augustine, May 24, 1984 . 16.

The data on the Cuban and American aid programs come from Jame s

Brooke, "The Cubans in Angola : They're Not All Soldiers," New

York

Times ,

January 22, 1985, p . A-2 . 17.

Supporting documents used in this section : PRG position papers o n

exports to the U .S .S .R ., MF-7473 ; Czechoslovak contract, MF-4705 ; Lebedinski y statement, MF-4094 ; Coard memorandum on the Soviet mission, MF-7130 ; othe r aspects of Soviet trade, MF-4845 ; G .D .R . banana negotiations, MF-4405 and MF 4733 ; Louisson's banana plantation scheme, MF-4618 ; identification of possibl e state monopolies, MF-4263 ; MNIB imports and exports, MF-7473 ; alternatives fo r the organization of foreign trade, USSD-94 and SM-III-11 ; political backgroun d on the organization of foreign trade, MF-3498 . Mestra memorandum, MF-5178 . 18. The announcement of the 1981 Soviet trade agreement (and also simila r "agreements" with Czechoslovakia and the G .D .R .) came in The Free West Indian , September 6, 1981 ; and the information that it was a mere trade protocol cam e from Lyden Ramdhanny [interview], who was the PRG Minister of Tourism . It i s quite unclear to me why the PRG misrepresented the nature of the trad e "agreement" to its citizens, especially since the lack of long run sales t o the Soviet Union would become so quickly known (although the Soviets did mak e some short-run purchases for 1982) . 19.

According to some Grenadians with whom I spoke, the United State s

forced Grenada to cut its relations with the Soviet Union and to cancel the

12/31/85

GRENADA

five year nutmeg contract . The New York Times,

Page 5 9

January 22, 1984, p . 10F ,

placed the blaim for the contract rupture just on American pressures to brea k diplomatic relations . However, the American charge, Roy Haverkamp [interview ] denied that U .S . pressures for this diplomatic rupture had ever been made . Why, then, were the exports stopped? The Executive Secretary of th e Grenadian Co-operative Nutmeg Association told me that since the contract wa s a government to government agreement, they were not involved in it s enforcement and they did not understand the reasons . A high official in th e current [1985] Grenadian govenment expressed a viewpoint which appears quit e believable : the breaking of the trade contracts by the Soviet Union an d Czechoslovakia was a violation of commonly accepted commercial practices bu t that the Foreign Ministry has been so overburdened with work that they didn' t have the personnel to pursue the matter and to take the appropriate lega l measures for enforcing the contract . This is another sad instance o f inadequate staff work by the Grenadian governmental bureaucracy which, in thi s case, has resulted in a considerable loss of revenue to the agricultura l sector . Certain domestic considerations might also weigh against such a n attempt to enforce the contract, e .g ., if it would require the presence o f Soviet officials on the island . 20. op .

The price data cited here and below came either from : Grenada, CSO ,

cit . ;

or from a computer printout of the 1983 trade results . The latte r

must, however, be considered only as preliminary estimates . 21.

This procedure was different from the custom among the Europea n

socialist nations of negotiating prices often many months after trad e quantities have been agreed upon . Such practices are discussed by Frederic L . Pryor,

The Communist Foreign Trade System (London : Allen and Unwin, 1963) ,

Chapter V . This granting of such premiums for exports of unessential

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Page 6 0

agricultural goods was not a usual practice between socialist countries unles s a high level political decision to grant aid in this fashion (e .g ., for Cuba n sugar) has been made . 22. These data come from the IMF souroe cited in Table 3 . 23.

This phenomenon is discussed by various authors in Peter Wiles, ed . ,

The New Communist Third World

(New York : St . Martin's, 1982) ; and David and

Marina Ottaway, Afrocommunism (New York : Holmes and Meier, 1981) . 24. These data come from the O .E .C .D . source cited in Table 3 . 25. According to the C .I .A ., National Foreign Assessment Center, Economic Statistics,

1984

Handboo k

(Washington, D .C . : 1984), 68 percent of th e

bilateral aid extended by the the USSR, Eastern Europe, and China consisted o f military aid .

APPENDI X Statistical Appendi x

The greatest difficulty in working on the economy of Grenada is th e difficulty in obtaining long run series on the economy . Moreover, there are n o official national account calculations . On the advice of Herbert Levine, I am including a brief statistical appendix with some of the various series which I have obtained or estimated . Full details of the tables, as well as many mor e series, are contained in my book, 1986).

Revolutionary Grenada (New York : Praeger ,

APPENDIX TABLES

Page

1

Table B-la : The Population of Grenad a 1946 Men

Women

1960 Men

Women

1970 Men

Women

198 1 Men

Women

0 up to 15 years 15 up to 65 65 and over Unknown age

15,307 15,216 15,077 22,782 1,420 2,539 30 16

21,046 21,222 18,087 23,714 1,527 3,081 -

21,934 21,787 17,214 17,008 19,865 23,756 22,983 25,133 1,893 3,540 2,536 3,99 9 10 5

Total

31,834 40,553

40,660 48,017

43,692 49,083 42,943 46,145

Table B-lb: Population Movement

1946 through 1959 1960 through 1969 1970 through 1980 1970 71 72 73 74 1975 76 77 78 79 1980 81 82 83 1984

Change in population

Births

Deaths Total

Emigratio n Infants (derived ) (under 1 )

16,290 4,098 -3,687

47,130 32,300 30,212

15,280 8,575 8,004

3,726 1,703 713

2,741 2,879 2,939 2,933 2,734 2,890 2,712 2,628 2,521 2,664 2,571 2,422 2,614 2,872 2,823

743 739 660 726 734 619 753 806 765 739 721 773 721 794 729

90 75 47 54 85 68 75 44 73 41 61 36 35 61 30

15,56 0 19,627 25,895

0

APPENDIX TABLES

Pag e

Table B-3 : Basic Labor Force Dat a 1946 Men

1960 Women Men

1970 Women Men

198 1 Women Men

Wome n

Population 15-64, 13,902 21,965 16,515 22,255 17,340 21,057 20,425 22,13 2 "available fo r work " 13,927 12,875 13,681 8,395 15,347 9,116 16,158 9,71 4 A. Working and short term unemploymen t 900 10 0 B. Adjustment for security personne l 235 338 767 768 922 1,052 1,721 1,690 C . Looking for first job 184 277 1,588 1,465 1,014 882 813 53 8 D. Long term unemploymen t 14,346 13,490 16,036 10,628 17,283 11,050 19,592 12,04 2 E . Labor force (common definition : A+B+C+D ) F. Discouraged worker s G . Labor force (broad defi nition : E+F )

24

35

204

188

130

113

620

386

14,370 13,525 16,240 10,816 17,413 11,163 20,212 12,42 8

Special unemployment definition s H. Short term unemployed and underemploye d I. U .S . definition of unemployment

638

377 1,691 1,315 1,614

93 1

697

648

768

939 2,674 2,422 2,782 2,592 3,341 2,96 4

APPENDIX TABLES

Pag e3

Table B-4 : Industrial Composition of Employed Labor Forc e

Agriculture, for estry, fishing Mining Manufacturing and handicraft Utilities Construction Transportation , storage, communicatio n Commerce Services Finance an d insurance Government Community and social services Other services Security (ad ment) Not available Adjustment to 198 1 definition Total (working or short ter m unemployed)

1946 Men

Women

1960 Men

Women

1970 Men

Women

198 1 Men

Wome n

7,064

5,505

6,962

3,306

5,498

3,094

5,653

2,00 7

4 1,727

3 (2,151

26 1,355

20 983

16 1,397

14 649

43 978

22 491

2,331 536

830 51

153 1,843 764

17 397 45

219 3,435 1,252

21 666 77

323 2,133 1,438

31 31 1 158

1,291 1,633

1,477 2,534

1,272 2,212

1,207 3,54 1

1,556

2,144

828

1,334

40

21

151

206

457 620

78 ,587

1,015 841

59 3 1,64 5

1,753 900

1,884 100

274 0

222 0

9,116 17,058

9,814

1 130 190

61 254

18 -364

13,927 12,875

13,681

4 -388

754 -708

8,395 15,347

432 -585

APPENDIX TABLES

Pag e4

Table B-5 : Exchange Rate and Trade Data (Current EC $1000) Year

Averag e annua l exchang e rat e EC$/US$

Trad e Visibl e domesti c exports

Reexports

Visibl e imports

1960

1 .7143

1 .7143 1 .7143

6,996 5,771 5,920

167

61

1 .7143

7,784

71

1 .7143 1 .7143 1 .7143 1 .7619

7,027

194

-14,832 -16,083 -15,319 -15,024 -17,673

10,678

195

-19,077

2 .0000 2 .0000

10,003 8,421 9,870 14,777

2 .0000

10,953

-21,724 -24,081 -26,346 -34,226 -44,632

1 .9749 1 .9213 1 .9592

9,291 9,955 13,637 17,650

193 160 283 662 1,122 902 576 875 1,615

26,004

834

32,872 36,900 44,340 55,697

948 1,853

62 63 64 1965 66 67 68 69 1970 71

72 73 74 1975 76 77 78 79 1980

2 .0532 2 .1698 2 .6147 2 .7000 2 .7000 2 .7000 2 .7000

81

2 .7000

82 1983

2 .7000 2 .7000

45,510'

50,275 47,748 50,711

159

147

1,244

2,102 1,436 1,081

2,339 1,076

-46,051 -42,812

-42,487 -37,080 -52,357 -66,250 -87,285 -96,452 -117,979

-135,574 -146,710 -152,429 -154,479

Visibl e trad e balance

-7,668 -10,153

-9,252 -7,169

-10,452 -8,205 -11,528 -15,501 -16,193 -18,786

Estimated touris t expendi ture s

2,2492,24 2 2,26 9 2,59 3 3,26 4 4,30 0 5,78 9 6,96 9 9,53 2 13,15 2

-32,557 -35,858 -32,281 -27,975

14,66 0

-17,814

10,11 7 16,68 7

-25,519 -32,429 -48,531 -50,868 -60,180 -88,628 -95,353 -102,342 -102,692

17,95 8

20,25 6 19,96 1 25,63 7 32,91 9 40,36 1

45,280 50,38 1 43,93 0

43,759 44,646 F

APPENDIX TABLES

Page '.

Table B-6 : Tourists and Estimated Tourist Expenditure s Year

1960 61 62 63 64 1965 66 67 68 69 1970 71 72 73 74 1975 76 77 78 79 1980 81 82 83 1984

Number of tourists arriving By air By sea By cruises

Tourist expenditure s US $1000 Volume (1978 dollars) index

6,379 6,358 5,961 6,870 9,100 12,108 15,988 18,153 20,695 26,669 27,429 32,555 35,081 30,620 13,751 19,451 22,856 26,249 30,015 29,305 26,768 23,280 21,728 22,174 27,819

3,186 3,120 3,108 3,493 4,319 5,568 7,247 8,184 9,400 12,148 12,503 14,733 16,450 15,242 6,752 9,661 11,416 13,235 14,949 15,080 14,481 11,140 10,205 10,119 12,138

1,530 1,612 2,220 2,448 2,088 1,742 2,147 2,396 2,469 2,958 3,007 3,071 2,852 2,870 972 1,608 1,695 3,673 3,899 4,208 5,813 1,792 1,542 1,164 999

16,351 11,742 13,366 11,256 10,436 15,590 16,500 16,484 26,500 39,118 41,261 48,652 94,060 132,297 57,644 85,460 106,882 108,465 116,331 138,654 145,594 77,596 62,119 50,217 34,166

21 .3 20 .9 20 .8 23 .4 28 .9 37 .3 48 .5 54 .7 62 .9 81 .3 83 .6 98 .6 110 .0 102.0 45.2 64 .6 76.4 88.5 100.0 100.9 96.9 74.5 68 .3 67 .7 81 .2

Value-adde d inde x 17 . 2 17 . 1 17 . 3 19 . 3 23 . 7 31 . 2 41 . 0 48 . 2 67 . 4 90 . 9 99 . 1 113 . 6 118 . 1 92 . 7 32 . 3 49. 6 74 . 0 88 . 2 100 . 0 95 . 8 86 . 9 73 .3 74 . 0 78 . 2 n.a .

0

APPENDIX TABLES

Pag e

Table B-7a : Major Exports (1000 pounds or 1000 current EC dollars ) Year

1960 61 62 63 64 1965 66 67 68 69 1970 71 72 73 74 1975 76 77 78 79 1980 81 82 1983

Bananas Weight Value

Cocoa Weight

Value

Nutmeg Weight

26,442 1,479 26,441 1,498 27,522 1,217 32,785 1,726 30,877 1,845 46,291 2,276 46,854 2,579 57,371 3,535 59,939 3,864 50,526 3,252 42,177 2,505 31,273 1,767 29,167 1,558 22,743 1,967 19,737 3,467 29,320 6,637 33,816 7,665 30,662 8,537 30,170 9,087 31,044 10,091 24,464 12,457 22,116 10,167 19,626 9,303 19,534 8,749

4,098 5,162 4,946 6,331 4,726 6,610 4,962 5,444 3,931 9,017 6,204 5,774 5,811 6,022 5,372 6,758 5,852 4,509 5,294 5,343 4,114 5,903 4,622 4,926

2,233 2,299 2,666 3,532 2,162 2,350 2,313 3,041 2,312 5,818 4,326 3,330 3,400 3,574 5,428 6,917 8,490 8,668 19,605 27,078 18,239 19,072 12,481 10,967

Value

1,367 908 1,331 1,582 1,390 3,277 1,989 980 2,964 4,878 2,992 3,812 4,118 3,178 2,366 4,448 6,107 6,639 4,604 5,072 2,906 3,795 4,505 5,748'

2,524 1,273 1,205 1,500 1,952 4,599 4,093 1,216 2,549 4,308 3,002 3,244 3,912 5,197 6,120 9,763 12,556 16,048 10,754 12,415 8,545 8,150 8,154 9,517

Mace Weight Valu e

Tota l value

153 .4 175 .1 321 .5 369 .5 604 .7 459 .4 245 .8 160 .3 362 .3 630 .8 420 .9 557 .5 951 .9 567 .5 320 .7 327 .0 953 .6 484 .4 583 .7 758 .9 558 .1 470 .1 735 .6 684 .2

6,776 5,60 3 5,697 7,52 1 6,732 10,36 8 9,695 8,22 2 9,44 7 14,41 9 10,46 4 9,04 8 9,860 12,44 0 16,62 1 24,60 6 31,67 0 34,864 41,156 51,88 2 41,08 6 39,09 9 32,45 4 31,49 6

539 .5 532 .8 609 .1 763 .2 772 .7 1142 .5 709 .7 429 .5 721 .6 1040 .9 631 .4 706 .6 990 .0 1702 .1 1605 .7 1289 .5 2958 .5 1611 .0 1710 .3 2297 .9 1844 .5 1710 .4 2515 .7 2263 .0

Table B-7b : Price Indices of Major Export s Year 1978 79 1980 81 82 1983

Bananas World Grenad a 100 .0 113 .6 130 .4 140 .0 130 .6 152 .4

100 .0 107 .9 169 .6 152 .6 157 .4 148 .7

Cocoa World Grenad a 100 .0 96 .8 76 .5 61 .1 51 .2 62 .3

100 .0 136 .9 119 .7 87 .2 72 .9 60 .1

Nutmeg U.S . Grenad a 100 .0 101 .2 104 .0 84 .3 76 .7 74 .4

100 .0 104 .8 125 .9 91 .9 77 .5 70 .9

Mac e U.S . Grenada 100 .0 126 .0 122 .8 132 .2 97 .3 74 .3

100 . 0 103 . 3 112 . 8 124 . 2 116 . 7 112 .9

APPENDIX TABLES

Page l

Table B-8 : Some Trade Indices

1960 61 62 63 64 1965 66 67 68 69 1970 71 72 73 74 1975 76 77 78 79 1980 81 82 1983

Four major export crops Volum e EC pric e Rea l index index pric e index

"Value added" indices Exports Exports Import s and less re tourism export s

50 .91 51 .09 65 .18 80 .22 65 .73 104 .57 73 .18 74 .55 98 .35 146 .63 101 .55 102 .07 109 .12 91 .29 70 .93 105 .50 127 .43 113 .56 100 .00 103 .34 75 .02 89 .69 81 .62 88 .57

76 63 65 83 73 111 102 81 86 126 91 73 74 80 68 88 89 90 100 107 71 76 73 81

32 .34 26 .65 21 .24 22 .78 24 .88 24 .09 32 .19 26 .80 23 .33 23 .89 25 .04 21 .54 21 .96 33 .11 56 .93 56 .67 60 .39 74 .59 100 .00 121 .99 133 .07 105 .93 96 .61 86 .41

157 129 103 108 115 111 145 115 90 90 92 75 73 86 97 85 73 81 100 104 93 71 66 61

53 46 47 58 56 81 84 78 88 124 111 112 118 103 56 75 83 89 100 102 79 75 74 80

75 81 77 74 85 91 102 108 106 133 168 165 147 113 63 81 83 97 100 104 98 103 108 114

Roug h estimate o f import uni t value s 32 . 5 32 . 5 32 . 5 33 . 3 34 . 2 34 . 2 35 . 0 35 . 8 35 . 0 35 . 8 36 . 7 39 . 2 42 . 5 53 . 3 77 . 5 83 . 3 85 . 8 92 . 5 100 . 0 117 . 1 143 . 7 148 . 6 146 . 6 141 .4

APPENDIX TABLES

Pag e

Table B-9 : Composition of Imports (Current EC $1000 ) Year

STC 0

STC 1

STC 2

1960 61 62 63 64

4384 4293 4529 4887 5126 5452 6273 6641 7469 8970 10997

651 577 431 520 522 578 675 791 752 1012

474 641 690 397 737 669 902

12986 12384 14540

1974

1965 66 67 68 69 1970 71 72 73 74

1190 1160

STC 3

STC 4

STC 5

STC 6

STC 7

STC 8

STC 9

1403

3210 3515 3322 2750 3392 3685 4252 4760

1892 2701

2056

91

2230 2342

1839 2057 2191 2052 2509 2414 3066 3378 4026 5375 6807 7004 5696 4699

21 26 24 22 19 16 10 9

1066 1440

96 84 111 76 81 113 108 46 236 194

861 689 739 874

1464 1298 805 , 848

1500

1440 1695 1924

2178 2366 2662

2884

5401

125 118

3296 3588 3852 3825

7008 10282 8965 7682 7837 6617

1356

1968 2130 1666 1703

1075

1194

2510

142

3610

15084

1490

1975

18256

2003

3156 4344

3504 6611

76 77 78 79 1980 81 82

21505

2149

260 344 316 434 336

1983

1587

26016

2603

1153 1276 2090 3580

31459 36099 39178

3241

3212

41415 41871

3564 4787 4160 3957

35406

3310

3853 5286 6004 7970 8437

5713 6995 7324 11817 17325 20783 20273 17251

413 669

703 268

410

7330 8657

10114 11900 14856 15143 15293 12285

1842 1750 1899 2675 3268 3753 3337 4948 7077 7235

6781 6067 2792

3021

10445

4270

5075

13637 18176 16825 20367 20859 20810 25524 21073

6836 12387 14406 20435 18915 24921 22545 39217

6661 8430 9528 9530 13699 12769

14729 17090

16 13 17

15 24

13 4 2 11 6 7

1 0 1 0 2

APPENDIX TABLES

Page

Table B-10 : Composition of Domestic Exports (Current EC $1000 ) Year

STC 0

STC 1

STC 2

1960 61 62 63 64 1965 66 67 68 69 1970 71 72 73 74 1975 76 77 78 79 1980 81 82 1983

6912 5679 5810 7624 6884 10510 9854 8330 9575 14601 10797 9222 9808 13440 17215 25287 32330 35459 42313 53928 41971 43698 40089 46615

31 12 11 27 24 9 4 3 2 43 2 1 1 6 4 8 112 41

48 52 66 64 37 57 38 34 196 83 38 7 6 19 10 33 16 15 4 24 1 14 129 23

STC 3 1 -

STC 4 2 3 -

STC 5

STC 6

STC 7

26 12 10 32 40 92 63 43 71 27 39 23 89 47 92 4 184 1 6 27

3 2 2 5 5 4 7 9 8 5 3 4 5 14 10 20 4 236 350 43 105 44

1 2 80 2 56 20 13 1

STC 8 2 25 58 64 7 6 5 8 24 38 21 37 123 418 455 511 1219 1962 1481 3171 6509 7307 3960

STC 9 10 25 7 3 7 5 2 2 7 10 3 6 1 -

0

APPENDIX TABLES

10

Pag e

B-12 : Direction of Trade (Current $ EC million ) Domestic exports 1977 E .E .C . nations CARICOM nations U .S .A. Canada East Asian nations (Socialist nations) China Cuba Czechoslovakia G .D .R . Poland U .S .S .R.

1978

1979

1980

1981

1982

198 3

28 .90 36 .61 46 .78 35 .12 35 .88 27 .01 23 .07 1 .87 2 .75 3 .40 5 .22 10 .56 15 .32 18 .77 1 .44 1 .15 0 .90 1 .40' 0 .77 1 .77 0 .99 1 .11 0 .82 1 .61 1 .44 1 .43 1 .14 0 .94 0 .00 0 .00 0 .00 0 .00 0.00 0 .00 0 .0 8 (2 .08) (1 .53) (1 .74) (0 .70) (0 .19) (1 .95) (2 .91 ) 1 .29 0 .00 0 .00 0 .00 0 .79 0 .00

0 .31 0 .00 0 .00 0 .00 1 .22 0 .00

0 .67 0 .00 0 .00 0 .00 1 .07 0 .00

0 .00 0 .22 0 .00 0 .00 0 .48 0 .00

0 .00 0 .19 0 .00 0 .00 0 .00 0 .00

0 .00 0 .11 0 .09 0 .02 0 .00 1 .73

0 .00 0 .42 0 .00 0 .00 0 .00 2 .49

1 .79 .

1 .19

1 .18

1 .63

1 .45

0 .56

1 .70

36 .90

44 .34

55 .61

45 .51

50 .28

47 .75

48 .46

1977

1978

1979

1980

1981

1982

1983

E .E.C. nations CARICOM nations U .S.A. Canada East Asian nations (Socialist nations)

26 .28 26 .31 11 .26 9 .82 5 .58 (1 .60)

28 .50 29 .05 13 .76 7 .73 6 .60 (2 .05)

36 .06 35 .20 16 .57 8 .13 8 .50 (2 .73)

31 .18 44 .51 26 .37 7 .70 12 .51 (4 .37)

34 .14 46 .39 27.22 8 .08 10 .20 (7 .99)

35 .44 45 .76 30 .82 8 .18 12 .64 (8 .65)

39.72 38.66 26.83 7.10 11 .99 (21 .47 )

Bulgaria China Cuba Czechoslovakia G .D.R. Hungary North Korea Poland Romania U .S.S .R. Yugoslavia Unspecified

0 .00 0 .47 0 .23 0 .30 0.13 0 .18 0 .00 0 .13 0 .00 0 .09 0 .00 0 .07

0 .00 0 .47 0 .72 0 .21 0 .07 0.11 0.00 0.33 0.00 0.04 0 .00 0 .10

0 .00 0 .62 1 .39 0 .21 0 .07 0 .09 0 .00 0 .20 0 .00 0 .08 0.00 0 .07

0 .00 0 .66 2 .74 0 .26 0 .10 0 .12 0 .00 0 .12 0 .00 0 .26 0 .00 0 .11

0 .00 0 .31 2 .74 0 .22 0 .27 0 .07 0 .00 0 .12 0 .00 4 .16 0.00 0 .10

0 .00 0 .66 6 .67 0 .30 0 .40 0.02 0 .00 0 .12 0 .00 0 .30 0 .00 0 .09

0.03 1 .05 4 .02 0.21 15.75 0.13 0.10 0.09 0.02 0.18 0 .02 0 .00

n .a . n .a . 6 .44

3.89 2.68 2.19

3 .37 5.34 2 .08

3 .90 3 .42 1 .61

4 .00 6.85 1 .84

5 .70 3 .88 1 .35

Other nations Total Total Imports

Central and South America Other Caribbean Other nations Total

87 .29

n.a . n.a . 8 .58

96.45 117.98 135 .57 146 .71 152 .42 154 .48

APPENDIX TABLES

Pag e1

Table B-15 : Land Usag e

Land under tree crops Arable land Temporary crop Temporary pasture Temporary fallow Other arable land Other Grassland Cultivated Non-cultivated Forest/woodland Other agricultural land All other land Total

196 1 Acres

197 5 Acres

198 1 Acres

28,091 13,101

23,153 12,765 6,994 2,540 1,398 1,833 48,502

22,92 2 12,60 2 6,92 5 2,490 1,37 2 1,81 5 48,89 6

391 1,703 7,635 930 37,863

388 1,66 9 7,46 3 92 1 38,455

43,228 705 5,939 9,504 2,857 24,223 84,420

84,420

84,420

3

12

APPENDIX TABLES

Pag e

Table B-16 : Size Distribution of Farm s Are a (Acres )

Less than 1 1 to 4 . 9 5 to 9 . 9 10 to 24 . 5 25 to 49 . 9 50 to 99 . 9 100 and ove r 100 to 199 . 9 200 to 499 . 9 500 and ove r Adjustment Total

1975 census 1981 censu s 1961 census Number Total Number Total Number of farms Tota l of farms area Original Revised are a of farms area (acres) (acres) (acres ) 6458 6052 934 418 100 42 92

14096

2476 11907 5998 5867 3367 2814 27768 3618 28 15098 52 12 9052 60197

5959 4938 741 343 75 51 65

12172

2510 10514 4888 4732 2607 3305 18117 27 357 0 30 886 0 8 568 7 46673

405 6 318 9 566 271 59 37 24

8202

4056 222 3 841 3 3189 566 411 4 271 418 7 61 209 7 43 258 9 43 1061 8 23 315 1 511 8 17 200 0 3 34 9 0 34241

APPENDIX TABLES

13

Pag e

Table B-17 : Agricultural Production Indices (1977 prices ) Year

1973 74 1975 76 77 78 79 1980 81 82 1983

Domesti c agricultura l productio n index 77 .9 70 .8 65 .7 66 .0 72 .2 100 .0 96 .9 97 .2 97 .0 97 .4 89 .8

Four majo r export crops Volum e Value index added index 87 .8 71 .9 104 .8 122 .8 110 .9 100 .0 106 .8 74 .0 90 .5 89 .3 100 .9

78 .2 68 .5 89 .3 92 .6 91 .6 100 .0 107 .7 69 .5 63 .9 53 .8 54 .1

Othe r export crops Volum e Valu e index added index 196 .0 106 .9 91 .6 88 .6 58 .4 100 .0 166 .2 132 .4 347 .4 580 .9 1150 .5

223 .5 87 .2 87 .9 75 .2 55 .6 100 .0 151 .0 113 .5 267 .5 450 .2 924 .3

Combined indice s Volume Valu e index added index 87 .6 72 .5 93 .6 106 .1 98 .8 100 .0 105 .5 81 .9 98 .6 103 .5 123 .2

81 . 3 69 . 5 83 . 5 85 . 7 86 . 1 100 . 0 106 . 0 77 . 2 76 . 5 73 . 2 82 .1

14 Page

APPENDIX TABLES

Table B-23 : Recurrent Budgetary Expenditures of the Central Governmen t (millions of current EC dollars ) 1974

1975

1976

1977

1978

1979

1980

1981

1982

198 3

Administration

2 .4

3 .0

4 .2

3 .6

5 .5

5 .6

8 .0

11 .2

10 .1

9. 4

External security Interna l security curity

0 .6 3 .1

0 .9 3 .2

1 .2 4 .6

1 .5 5 .1

2 .1 6 .4

4 .7

5 .9

6 .5 4 .7

8 .9 4 .9

7 .9 5 .1

7. 9 5. 5

5.2 social,youth Health and housing 3 .2 Pensions 1 .2

5 .5

7 .7

7 .0

9 .1

10 .7

11 .5

14 .1

15 .3

16 . 6

3 .6 1 .3

4 .8 1 .3

5 .4

7 .6 2 .3

8 .6

1 .8

6 .9 1 .8

2 .4

10 .2 3 .1

9.8 3 .5

11 . 2 4.1

Agriculture and tourism Construction and public works Payments for communicatio n

1 .0

1 .2

1 .7

1 .5

2 .0

3 .9

4 .4

5 .5

3.7

4. 1

1 .8

3 .1

8 .1

4 .8

6 .9

9 .1

9 .5

6 .8

3 .4

1.9

0 .5

0 .5

0 .6

0 .6

0 .7

1 .0

1 .2

1 .7

1 .8

1.8

Debt payment

1 .4

1 .9

1 .7

1 .7

3 .4

3 .1

3 .4

2 .2

7.4

12 . 9

Unspecified (+) or 0 .0 double counted (- )

0 .0

0 .0

-0 .9

0 .5

-0 .5

-0 .7

-1 .7

-1 .3

4.5

20 .2

24 .1

36 .0

32 .2

45 .2

53 .4

59 .6

66 .9

66.9

79 .8

Education,labor ,

Total recurrent

I

APPENDIX TABLES

Pag e

Table B-24 : Capital Expenditures in the Public Secto r (millions of current EC dollars )

1974 1975 76 77 78 79 1980 81 82 83

Budget reports Central government State Actual Adjust- Direct Expt . for Capital enterreports meats fixed land and grants to prises capital shares state (non enterfinancial ) prises 3 .5 2 .5 2 .5 1 .8 1 .4 2 .5 3 .6 2 .5 1 .4 3 .9 6 .6 24 .6 1 .1 32 .5 35 .2 0 .7 1 .9 69 .9 1 .3 67 .8 3 .6 6 .7 101 .5 75 .8 9 .4 15 .1 19 .9 70 .5 n .a . 10 .6 13 .9 n.a .

Tota l fixed capita l

6. 0 4. 3 3. 9 6. 1 3.9 25 . 7 37 . 1 76 . 6 95 . 7 84 .4

e

APPENDIX TABLES 16 Table B-25a : Agricultural Wages and Retail Prices, Selected Year s

Daily wag e EC dollars Men Women

Real wage index, 1979=100

1950 1951a

0 .82 0 .91

0 .68 0 .76

43 . 8 42 . 1

1952b 1954 1957

1 .20 1 .44

1 .00

1 .56

1959a

1 .70 1 .80 1 .80 1 .80 1 .80

1 .30 1 .45 1 .50 1 .50 1 .50 1 .50 1 .70 1 .70

55 . 4 70 . 0 70 . 6 78 . 7

1959b 1960 1961 1962 1963 1964

1965 1966

1 .20

83 . 1

1 .70

84. 8 84 . 8 85. 7 95 . 8 94 .8 95 .5

3 .00

2 .50

108 .6

4 .00

3 .00

111 .9

8 .50

7 .50

100.0

2 .00

2 .00 2 .00

1967

1968 1269 1970

1971 1972 1973 1974 1975

1976 1977

1978 1979 1980 1981 1982

1983

Retail price s May of each year ) 1978 = 10 0

27 .3 . 27 . 1 27 . 8 30 . 0 33 . 2 35 . 5 37 . 8 40 . 7 44 . 7 51 . 4 73 . 1 76 . 1 86 . 6 93 . 0

100 . 0 111 . 3 133 . 1 162 . 0

174 . 0 11 .50 10 .50

81 .8

185 .8

Page

Table B-27 : GDP Indices with Comparisons GDP estimates Volume Value added 1973 74 1975 76 77 78 79 1980 81 82 1983

93 .3 64 .8 78 .8 89 .1 91 .5 100 .0 107 .7 98 .8 103 .9 105 .7 109 .0

89 .8 60 .8 72 .8 84 .0 88 .5 100 .0 106 .3 93 .7 97.3 99.1 101.8

Other estimate s World Ban k I .M .F . (GNP) (GDP) 93 . 8 74 . 2 82 . 3 89 . 5 95 . 0 100 .0 102 .1 105 .2 109 .2 p 106 .2 p 100 .9 p

100 . 0 102 . 3 102. 6 104 . 3 108 . 9 107 .7 p

p = preliminary

r

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Economic Relations Between Third-World Marxist Nations and the

FINAL REPORT TO NATIONAL COUNCIL FOR SOVIET AND EAST EUROPEAN RESEARC H TITLE : Economic Relations betwee n Third-World Marxist Nation s and the Sov...

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