Soviet International Finance in the Gorbachev Era

by C. Richard Neu

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This report presents a profile of Soviet international financial activity and a short history of the Soviet Union's reversal of financial fortunes that began in late 1989. Updating R-3524, it provides much new material necessitated by changes in the way the Soviet Union conducts its financial affairs. The author finds that three elements of the current Soviet financial situation are likely to have a strong influence on Soviet international finance for the next few years: (1) the near total dependence of the Soviet Union on the goodwill of Western governments if it is to borrow hard-currency funds; (2) the short maturity of Soviet international debt; and (3) slack in Soviet hard-currency accounts in the form of Soviet financial assistance to other countries.

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