INFORMATION ON GDR FOREIGN TRADE, UP TO FEBRUARY 1954

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000700200172-7
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 20
• Document Creation Date: December 22, 2016
• Document Release Date: August 31, 2011
• Sequence Number: 172
• Publication Date: October 26, 1954
• Content Type: REPORT

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CLASSIFICATION C-O-N_F-i
CENTRAL INTELLIGENCE AGENCY
INFORMATION FROM
FOREIGN DOCUMENTS OR RADIO BROADCASTS
COUNTRY GDR
SUBJECT Econcmic - Foreign trade
HOW
PUBLISHED Daily newspapers, weekly periodicals
WHERE
PUBLISHED Berlin
DATE
PUBLISHED 8 Sep 1953-4 Mar 1954
LANGUAGE
rr ? .onrnr w.,.u. uromner .n?*i.. r.r w
.rn MI wu
un.r ar in eorrwn~r. o.?..eurr .y
r... u~ ..,mr.onc.. nnwrn
REPOR
CD NO.
DATE OF
INFORMATION 1953-1954
DATE DIST. -Z(- Oct 1954
NO. OF PAGES ._Q6
SUPPLEMENT TO
REPORT NO.
THIS IS UNEVALUATED INFORMATION
INFORMATION ON GDR FOREIGN TRADE
UP TO FEBRUARY 195
(Numbers in parentheses refer to appended sources.)
The 1954 GDR-USSR trade agreement was signed in Moscow on 13 February 1954.
I. G. Kabanov, USSR Minister of Foreign Trade, signed for the USSR, and Kurt
Gregor, GDR Minister of Foreign and Intra-German Trade, signed for the GDR.
Because of the cessation of reparations deliveries and the cancellation on
the part of the USSR, of the GDR's indebtedness to the USSR, the quantity of
commodities to be exchanged in 1954 is considerably higher than in 1953. It
is about three times that exchanged in 1950.
GDR deliveries to the USSR in 1954 will include mining equipment, dressing
installations for mining products, installations for the metallurgical industry,
cranes, machine tools, woodworking machines, presses and cutters, chemical pro-
duction equipment, pumps, compressors and fixtures, refrigeration installations,
equipment for the construction-materials industry, ships, rail vehicles, elec-
trical equipment, precision and optical instruments, textile machinery, food-
processing machinery, machinery for the beverage and tobacco industries; machin-
ery for the cellulose, paper, and printing industries; chemicals, and consumer
goods.
The USSR will ship to the GDR in 1954 such foodstuffs as grains, protein
feeds, meat, butter, vegetable oils, canned goods, and legumes. The raw materials
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si ferroalloys, nonferrous metals,. ores, pig iron,
wool, other texti
lene, and raw materials, chemical , precious metals, cotton,
lane, and Phariaaceutical awRmaterials. products, crude petroleum
The USSR will also send 1+00 additional
954.(1, 2)
China
uct
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On 30 November 1953,
ments of a Chinese trade delegation arrived in Berlin to initiate
the fourth annual trade negotiations between China and the GDR. Like the agree-
GDR-Chinese 1952 and 0
GDR-Chinese trade a 3 April 1953, this agreement will also be based on the
provided for an trade agr e seeof o 10 October 1950. The agreement of p
~9ov 8 August 1 3 percent in the trade volume, as c 3 ed with 1953 a 1952. On for the excha a of ple entry protocol to this agreemennttawas signed
pries. 50 million rubles' worth of commod_
The GDR and China signed a 1951+ trade agreement agreement provided for a 35 percent increase in theBvolumeoof
to be traded, as compared March 1954.
ompared with 1953?1
commodities
China intends to import 15-19 billion rubles' worth of commodities during
the next 2-3 years. Both the GDR and West Germany have an o
in this trade.
opportunity to share
GDR-Chinese trade was at first beset with difficulties. GDR foreign-trade
personnel was inexperienced. China was considered a bottomless barrel' willing
to accept all types of goods. They had a priority in acco failed
to realize that specific c
rdance with China's owwn Five-Year Plan. ommodities
Other difficulties arose from the GDR 's failure to make deliveries as ached-
uled. This failure was caused by the fact that the EAs
not turned over to the producing enterprises on time, so that they integrated into the s egrated goo5 production plans soon enough. could be . Many Peiping and Shanghai industrial exhibitionscontractsinfor1953 195and 4 at were the cludedt the or
jr. FaOthers have already been concluded on the basis of the Order lists
mitted by China. 953 Leipzig
sub-
It would be advantageous if the negotiations [of the annual trade agreements j,
at least as far as GDR exports are concerned, were carried on in Berlin in future
years. This would facilitate closer consultation with Producing Plants regard-
ing specifications and delivery dates.
-
The following suggestions will also help to improve trade relations between
the GDR and China:
1. DIA (Intra-German and Foreign Trade Enterprise) must be responsible for
giving Chinese representatives proper advance notice that the commodities will
be ready for shipment at a specific date. Such notification is
the contracts, but it has been given only in about 0
queerly because the provided for in
o f percent of hie se ne, frh-
quet beca so the producing plmakeantthes t
noarry Dep. The rthes neip d this tey the commodities and can charter the necessar ca gorships
nts for the receipt of
y cargo ships.
2- DIA must exercise greater control over the pacingin,; of shipments.
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3. DIA must make every effort in its correspondence with China to express
itself clearly to avoid unnecessary expenses and delays arising from repeat
inquiries and corrections.
4. Complaints about shipments should be satisfied quickly, without await-
ing the decision of the arbitration court.
5. Labels on and instructions for machinery exported to China should be
in Chinese as well as in German.
6. Catalogues and brochures sent to China are often unsatisfactory. Some
are only in German. Others are in German, Russian French, Spanish, and English;
but the specifications are given only in German.(3j
EM&arZ
On 30 January 1954 the GDR and Hungary signed a "Protocol on Mutual Commodity
Deliveries in 1954" in Budapest. Hungary will deliver high-grade foodstuffs and
consumer goods, agricultural products, and industrial goods. The GDR will de-
liver machinery, precision and optical instruments, electrical equipment, pro-
ducts of light industry, and chemicals. The protocol was signed by Hans Paul
Ganter Gi7mans, State Secretary in the MAX (Ministry of Foreign and Intra-German
Trade) for the GDR and.by (fnu) Czimer, an official of the Ministry, of Domestic
and Foreign Commerce, for Hungary.(4)
Be_ 1Rium
As a result of negotiations in Brussels during the period 2-8 February
1954, FIB (Federation of Belgian Industries) and DIA (for barter trade] agreed
to increase the commodity-quota lists for trade between the GDR and Belgium by
200 million Belgian francs. The agreement, which was signed on 8 February 1954,
also provided that trade with the Belgian Congo would be covered by this agree-
ment.(5)
France
The 1.854 trade agreement between the GDR and France, concluded on 9 De-
'c""ember 1953, will allow an improvement in GDR-French, trade relations. The
following are the specific advantages of the new trade agreement as compared
with that of 4 January 1952:
1. The new trade agreement provides for an exchange of 4,150,000 dollars'
worth of commodities, as compared with 2,030,000 dollars' worth in the earlier
agreement.
2. The commodity lists of the new agreement include many commodity groups
needed for carrying out the New Course.
3. The new agreement provides for 28 commodity groups to be imported into
the GDR and for 24 commodity groups to be exported, as compared with 6 and 5
commodity groups, respectively, in the preceding trade agreement. The commod-
ity groups in the 1954 trade agreement include such inclusive groups as chem-
icals, machinery, and parts.
4. A "miscellaneous" commodity group has been included in the commodity
lists.
5. A swing balance has been agreed on (amount not indicated]..
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sentatives in c red themselves willing to meet with GDR repre-
the course of the year to check on thewillingutilitozation of the
commodity lists. Each side has declared itself consult with the
other regarding changes in the commodity lists.(6)
7. The French have A.
l
individual contracts J ~~ 1e uutt is no longer required. Instead, the
concluded under this agreement will establish the terms
under which transactions will be carried out.
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GDR IMPORTS
During the period 1 July-15 September 1953, the GDR imported 28,000 tons
of butter from the USSR. As a result, the total butter imports of the GDR
from the USSR for the period 1 January-15 September 1953 amounted to 43,000
tons. During the same period, the GDR imported 435,000 tons of wheat, oa rye, and
ts from the USSR.
The supply of margarine and salad oil has also improved as a result of
imports of all types of fats from the USSR, China, and other Oibit countries.
During the pericd 1 January-10 September 1953, 36,000 tons of vegetable oil
were imported into the GDR. Of this quantity, 23,700 tons arrived during the
third quarter 1953.
Magdeburg Will receive 410,OOO bottles of Rumanian and Hungarian wines
during the fourth quarter 1953. The city will also receive some of the West
German wines which were purchased by the GDR at the Leipzig Fair. Of these,
seven ith wine bbottlesfrofeightedcwinears
have ea rived.
Sixty of Bordea wine h vehbeen're-
ceived from France-(7)
Imports into the GDR from the USSR received at Frankfurt/Oder during the
first half 63' October 1953, included the following:
Meat and smoked sausage
High-grade liquors, including
1 n ev I??
Canned milk and-cacao powder
56
28
25
3
11
5
32
229
4
Imports from Poland received at Frankfurt/Oder period
included the following: during the same
Poultry
Vegetables
Brewing barley
Eggs, canned fish, canned meat
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s of mentsDfromgtheeUSSRsarriiveeddyat Frankfurtr 1953, the following import ship-
/Oder:
Frankfurt/Oder:
Item
Vegetable oil 131
Grain 28
Oil seeds 873
Canned fish and legumes 280
56
Wines, liquors, and chocolat
es
25
During
the
sa
at
Frankfurt/
me period, the following imports from Poland arrived
Oder:
Item
Canned and fresh fish, eggs, 49
honey, vegetables
47 (9)
Wheat imports of the GDR from the USSR increased during the weeks preced-
ing 9 February 1954. The lighter Tundra arrived in Wismar about 5 February
1954 with 3,000 tons of wheat. The steamer Ryazan, out of Riga, was unloaded
at Rostock on 8 February 1954 (presumably it carried wheat].
1954.,the motor ship Pyarnu, On 9 February
out of Tallinn, was on its way to Rostock with
were unloaded untons of loaded at abfirstout
weekst of s lOfB grains, mostly wheat,
954( 0)
During the first 10 days of February 1954, 1,796 carloads of grain and 50
carloads of legumes, canned fish, and vegetables arrived at Frankfurt/Oder from
the USSR. During the. same period, the GDR imported from other Orbit countries
25 carloads of poultry and fish and five carloads of spices.(11)
Textile Raw Materials
During the first half of October 1953, the USSR delivered to the GDR 1,160
tons of cotton and 310 tons of wool.(8)
During the period 1 October-13 November 1953, the USSR sent 130 carloads
of raw wool to the CDR. Of these)40 carloads were loaded with half-coarse and
fine wool. Two thirds of the latter will be sent to the Leipzig Wool-Combing
Enterprise, and the rest, to the Schedewitz plant of the Zwickau Worsted Mill
and to the Neuhuetten plant of the Rodewich Woolen Mill. After processing in
these plants, the wool. will be sent to the worsted mills of Thueringen and
Sachsen, as well as to cloth and felt factories, for further Processing.(12)
During the first 10 days of December 1953, the GDR imported the following
textile raw materials from the USSR:
Item
Cotton (3,000 tons)
260
Cotton fabrics and
arn
24
y
9o (9)
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tons of cotton, as well as ys of February 1954, the GDR imported 5,000
and hemp, from the USSR.(11)bPecified quantities of] yarns, flax tow,
Leather and Leather Goods
The Import Branch of the DM (German Trade Center) for Leather in Halle
received 55,000 pairs of leather shoes from Czechoslovakia during During
shoes the second quarter 1954, this branch e February
and44 a 's3) from Austria and ladies' sports sli ladies'
shoe s s and and men's s slippp pers fros from
Industrial Products
During the first half of October 1953, the GDR imported 35 ZSP2-type
mobile grain dryers from the USSR. Machinery delivered to the GDR by during this period included 12 rollers for metallurgical enterprises,
weighing a total of 165 the
wnduct 5 tons; 5 modern freight elevators for the building
rY; 30 tons of nails; and 40 tons of track links for tractors.(8)
Hea Machine
The Karl Liebknecht Heavy Machine Building Enterprise, Magdeburg, is
completing the USSR's "friendship order"[a euphemism for reparations order]
for five ships' engines.(14)
I/ The VEB (people-owned enterprise) "Erich We inert" Factory in Magdeburg
produces both for export and for domestic use large fittings for industry,
such as gate valves of various designs, wedge valves (Keilschieber), disk parallel-gate valves, and piston valves for gas, water, steam, and oil.
These fittings are being built to su double-
export to Orbit s PPlY the needs of the GDR, as well as for
Belgium, rtand non-Orbit countries. Fittings are export exported to Luxembourg
India, and Egypt. Hungary has placed orders for more than 11 tons of
cast-steel fittings with this factory, which are to be delivered by 30 June
1954. However, the workers of the factory have obligated themselves to deliver
the fittings 6 months ahead of schedule.
In October 1953, the Rudisleben Machine Factory resumed
crystallizers, to be exported to the USSR. Thirty
crystallizers delivered, and 40 more are now being Production of
Producing oxygen plants for rystallizers have already
Th same en
r5) is
Poland and 50 miilkltanks for
ethe USSRt(15)
The 1954 export program of the VEB ERM (VEB for the Construction of Power-
Plant Machinery and Motors) Halberstadt Machine Building Factory is 50 percent
higher than the 1953 program. diesel installations for The plant plans to export large stationary
electric power stations, ships' diesels, and cosres
for large gas plants. Negotiations are under way
for for the delivery tory's diesel-electric
power stations to non Orbit countries, of this fac-
In 1953, the VEB Germania Machine Building Factory, Karl-Marxported 30 percent of its production (o of the
Czechoslovakia , ex-
f unidentified commodities] to the USSR,
facto , Bulgaria, Poland, and Albania. In 1954, 80 percent
rS s production will be exported. The USSR, Poland, and Albania will re-
ceive most of these exports. It is also planned to send a complete
factory to Brazil.(16)
fish-meal
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The VEB Ernst Thaelmann Machine Building Enterprise, Magdeburg, recently
delivered to the USSR the largest rotary cement kiln in the world. This huge
machine has a welded steel tube measuring 5 by 4 meters in diameter and 135
meters in length.- It is designed to produce 1,200 tons of cement clinker in
24 hours. It requires 450-500 horsepower for operation, and it is estimated
that its metal parts alone weigh 900-1,000 tons.(17)
Transportation Machinery
The VEB ABUS (VEB for Equipment for Mines and Heavy Industry) Eberswalde
the USSR, Crane-Building
the
PolandFaRctory iais, astillBulgari
uman
n working[November
d
orders for
a on a number19531of. 1953 Among export these orders
is a bridge crane with cantilever extension, which is to be delivered to Poland.
SAG (Soviet Corporation) Bleichert Transportation Installations Factory,
Leipzig, had exceeded its 1953 export plan by 6.4 percent as early as the end
of October [19531. It has further obligated itself to complete an export order
for a bridge crane with a 40-meter span before the end of December. This bridge
crane is part of the factory's export plan for the first quarter 1954. The fac-
tory is now building three bridge cranes and two cable cranes with an 860-meter
span width, as well as 20 excavators (Kugelschaufler) All of these are to be exported before the end of the year. y 20 mobileg thenpa.
months [prior to November 1.9531, cable railways, cable cranes Dueler ic past
as well as excavators (Kugelschaufler) have left theplantfor Bulgaria vunngar,
Poland, Czechoslovakia, Rumania, and China. g , Hungaryy,
Two floating cranes were delivered by SAG Bleichert to the Mathias Thesen
Shipyard in Wismar to be mounted there. But the work at the shipyard has been
progressing very slowly.(14)
The "Ernst Grube" Motor Vehicle Plant in Werdau fulfilled its [19531 export
plan on 10 December 1953, when it delivered [to DIA] the last 6-ton trucks for
export to China.(l8)
Newly s consists, Locomotive Building andelecElectrtric
Worksced by the Raps arem being
delivered primarily to Warsaw. These consists are capable of aospeedrof140
kilometers per hour. This plant also has orders for express train locomotives
to be exported to Poland. Electric locomotives for export to China, Czechoslo-
vakia, and Rumania are also on order, as well as several new types of chain-
welding machines (Kettenschweissmaschinen), to be exported to the Orbit coun,._
tries.(19)
Lirhty
The Optima Office-Machine Factory, Erfurt, completed 79 percent of its
1953 export plan for exports to the USSR and Orbit countries by late November
1953. The balance of the export plan is to be completed by 20 December 1953?
During October 1953, the factory shipped a large quantity of typewriters
with Chinese characters, which had been developed in this enterprise, to China.
A part of a second shipment of such typewriters left the factory in November
[1953]?
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In October 1953, the factory received an order from the USSR for business
machines with Russian characters. The order is to be delivered on 15 December
1953?(20)
The privately owned handi
craft firm, Wendt & Kuehne, Gruenhainichen, is
re-establishing its old business contacts' Outside the GDR. At the 1953 Leipzig
Fair and at the 1953 St Erik's Fair in Stockholm, it received orders for novelty
items and toys from all the Scandinavian countries, England, France, the US,
Switzerland, Italy, the Netherlands, and Belgium. It has received an order for
a large number of music boxes from Venezuela, and inquiries from other countries
in South and Central America and from South Africa. The firm will have its own
exhibit at the 1954 Frankfurt [Main] Fair.
The enterprise still has several difficulties in meeting the demand created
by this renewed interest in its products in other countries. Mechanisms for the
music boxes must be imported from Switzerland at 8 Swiss francs a piece. Al' '
though the finished music boxes bring in much more in foreign exchange, the firm
has had difficulties in obtaining the necessary forei
anisms from the DIA. Similarly, the firm has had difficultiesginfobtaining the
foreign exchange for Swiss clock mechanisms, selling at 2 Swiss francs a piece,
which are to be installed in handcarved housings designed rooms. The firm also has difficulties in obtaining cr dit.foDNcinsists that it
first sell its warehouse stock. But the firm must have a large warehouse stock
on hand to meet all the demands of the export trade.
Other private enterprises in the Karl-Marx-Stadt area are engaged in
pro-
ducing for export. The furniture-covering and moquette-weaving firm of Cammann
and Companie, karl-Marx.Stadt. has received orders from all over the world. The
firm produces damasks, brocade velours, gobelins. and other materials. The prod-
ucts are made with domestically produced staple fiber of the types B and W and
with artificial silk. The silk-like luster and other qualities of these new raw
materials surpass those of the wool and cotton fibers formerly used. The fast-
ness of the colors also measures up to prewar standards. At the GDR's irdustrial
fair in Cairo, the firm exhibited all color variations, from the finest pastels
to the darkest shades. All of the firm's designs come from its own studio and
include the styles of all epochs.
Craft organizations in the Karl-Marx-Stadt area are likewise producing for
export. On the instigation of the recently organized Export Committee for Tex-
tiles in Karl-Marx-Stadt, the Westsachsen Association of Knitters and Small Weav-
ing Shops is now preparing samples for exports. However, the knitting industry
has difficulties in obtaining materials needed to fulfill export orders. It hdS!.
not yet obtained knitting needles, which have been on order from the VVB Textimai
(Administration of People-Owned Enterprises for Machinery for the Textile and
Clothing Industry) and the DIA for a considerable time. Likewise cotton, which
was to have been received in December 1953 for an export order to be comple9;ed
during the first quarter 1954, has not yet been received. Time Westsachsen Asso-
ciation of Knitters and Small Weaving Shops is exporting staple goods to the USSR
and Orbit countries, and is endeavoring to resume an export trade in madras cur-
tains and in cloth fabrics. However, efforts to conclude export agreements at
the 1953 Leipzig Fair failed because [the industry and GDR authorities] did not
adjust [their prices] sufficiently to world market prices. The excessively low
producer prices imposed on the industry, in most cases, the 1944 producer prices,
are lower than actual production costs., These low prices stifle the incentive
to produce marketable bed linen, twilled cottons, and colored shirt flannels.(21)
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Chemicals and FSzels
have Fifty trainloads of products of the VEB Walter Ulbricht Leuna Works
left the plant during January 1954. The shipments consisted
of fertilizer
Ported to 2 ' gasoline and diesel fuel. The products of this Primarily
1954 (22) 3 countries in 1953? This number is expected to be inereasedrinex-
Seed I
The Erfurt [seed industry] is again exporting Great Britain, Denmark, Poland, and other countries, Vegetable seeds are also
being delivered to Great Britain, Poland, Hungary, and Czechoslovakia.
iP.ht_ Iust
The VEB Special Machine Building Factory, Karl-Marx ~Stadt, is the only GDR
concern producing machinery for the production of pharmaceuticals. The pro-
duction
duction program includes machinery pro-
pills, etc. Production in 1954 will be raisedtton128 pelves
with 1953. In 1953, about 30 as eepo,ted compared
Czeoslovakis, [Nosh percent of the production was exported to ].Korea, Rumania, Poland, Chile, Finland i6
, and Switzerland.(16)
a The Hungarian export export order association for 3,300 of the wine cooper barrels, trade the Bezirk Halle has
liters (each]. received
inwhich are to hold
? 300-500
The Ruebsch firm in Seiffen is exporting furniture to the USSR
West Germany.
Italy, and
Italy is to receive 200,000 Deutsche marks, worth of toys frc
birge
birge area in 1954.(21)
m the Erzge-
Trade 1952_1 5
In 1952, commodity lists were exchanged between the GDR and West German
The GDR then promptly began to impost commodities from West Germany
Germany did not license imports from the GDR West
commodities amountin to 8 until late in 1 . As But West
toles g 5 million VEs (accounting units) co As a result-
, precision and optical instruments n, ttconsisting an of emit
accumulated awaiting shipment. ' Paper and printed latter
amounted to 92 million VEs underTsubaccounts22 and imports from West Germanicals,
Germany under these subaccounts amounted VEsGDR e Y
anted only to 55 millio.. xPorts to West
In consequence of this situation, the GDR had an unfavorable balance of
trade with West Germany on 1 January 1953 as follows;
37 million VEs
2.8 ,
9-
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During the first 6 months of 1953, the GDR limited
Germany and thus achieved a complete normalization of
its imports from
West
The following is the balance of trade for subaccounts 2 and
rY-31 October
Subaccount 2 3 for the
Deliveries by the CDR
Deliveries by West Germany
Balance in favor of the GDR 112'3 million VEs
68.8
Subaccount 3 43.5 "
Services rendered by the GDR
Services rendered by West Germany
Balance in favor, of West Germany 18.8
14.8
On 31 October 1953, there was
million VEs in favor of the therefOre an over-all balance of trade of 28.7
deducted from the unfa for subaccouuts 2 and 3 ce
is .amount Of 39.8 million the unfavorable balance of the GDR ? When this balance
CDR of 11.1 million there remains an on 1 January 1953 (in the
VE5 on 31 October 1953 trade balance
953 for subaceounts 2 and of the
The volume of trade on subaccounts 2 and 3 3
more Y groupssbeeextendedDasproposed repeatedly that trade have been considerably
follows: in the following commod_
Decorative Porcelain
Pot metal glass 400
Other '0 VEs
glassware 250,000
An exchange of onl 250,000
The GDR disposal
the disposal [in WestOO,o Vas' worth of these te , although
The
er Germany] of the dill was authorized
upplies Proposed the Was assured through .
change of 100 mostly pencils and pencilglead bOppseni sane w contracts
of million VEs Teas , in he in the same value. toys for office
prevented by West Germany. together, an ex-
The following is the balance of trade for subaccounts 1 and 4
1 Jan r7-31 October 1953:
Subaccount 1 for the period
Deliveries by the GDR
Deliveries by West Germany
Balance in r..,.,.. _. 20.9 million VEs
-Deliveries by the GDR
Deliveries by West Germany 66.3
Balance in favor of the GDR 53.3
Thus, there is a 13
subaccounts net balance in favor of 1 and 4. West Germany of 1.9 million
VEs on
[This would leave a net balance of 13 million VEs
on all subaccountson 31 October 1953, compared wit in favor of West Germany
million VII in favor of West Germany , on as c accooutse2 andh a net 39.8
balance of
3 on 1 January 1953.
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Source does not indicate whether there was any balance either for or
GDR on subaccounts 1 and 4 on 1 January 1953. The GDR's
against
trade,balance amounted t 4
the
o
unfavorable interzonal
4.4 million VEs on
30 September 1953?].x'
aammi.tte.e to Promote Intra-German Trade
At an economic conference held in Berlin on
tion of the GDR National. Council of the Rational Front, a C
Intra-German
Trade was organized. It will consist of 1 ~ittee to Promote
many, 2 from West Berlin, and 10 from the GDR. 5 members from West Ger-
More than 600 representatives of the West German and West Berlin economy,
as well as of the GDR economy, attended the economic conference.
made the following proposals:
The conference
1? Expansion of intra-German trade to one billion VEs in each direction,
as suggested by the GDR.
?? Acceptance of the proposal.
million VEs. of the Magistrat of Greater Berlin [East]
for a. trade agreement for the two East and West Berlin in the amount of 200
3. Increase of the swing balance of the GDR under subaccount 2
interzonal trade agreement from 40 to 60 million YEs.
of the
k? Long-term payme
t
n
are terms for West German deliveries to the GDR such as
granted by the GDR to West German businessmen. [No further details given.]
5. Establishment of permanent offices of the committee, which will give
Prompt counsel on questions of intra-German trade to those who are interested.
6. Regular.consultative evening meetings between DIA and its West German
and West Berlin trade partners.
7. Mutual visits of GDR and West German businessmen in the interest of
better understanding and closer contact.
In addition, the economic conference made a number of proposals concern-
ing changes in antra-German trade procedure. These included
billing procedures on the part of West Germs
Parts by the GDR. ee and the assembly pos iblevto of
exhibit GDR ~rther, West German decrees which make it im
products [bearing trade marks also used in West GenY) ] a at te to
German fairs must be revoked.
West
Among those attending the conference were Dr Moser,(ihuhec ckhief of the
Geeellkchaft abet Osthandel (Company for Eastern Trade); Dusc
the Magistrat of Greater Berlin [East); and Lubbe (?n.), the Hamburg ship owner
), of
and shipping firm manager.(23) ' (ihu
Trade Between GDR and West German Consumer Coo eratives
The VDK (Association for German Consumer Cooperatives [GDR]) has
to the GDG) Hamburg, that commodities valued at 25-30 million VEs be exchanged
in 1954. In the near future, proposed
Purchasing ompeny ar Ge the VDK expects to sell to the GEG
of sugar, for which ny of G will deliver fats [West Ge )W3
the VDKB 2t) 3,000 ,000 tons
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A VDK delegation has arrived in Hamburg to negotiate with the GSG for
increased purchases by VDK from GM:
million VE '4;v VDK Proposed that it purchase 25-30.
sorth of commodities. The two parties had agreed at the [19531
Leipzig Fair that the VDK would Purchase 1.6 million VEs' worth of fish and
fish products from GEG. But the West German government reduced this amount to
400,000 VEs.(25)
The VDK delegation now negotiating with GEG proposed an agreement for the
exchange of 32 million VEs' worth of commodities. GEG stated that it required
the consent of the West German government for such an agreement, but that it
could give a reply within 2 weeks.
It was agreed that a standing commission of the associations of consumer
cooperatives in West Germany and the GDR be appointed to deal with all matters
of commodity exchanges between the two associations.
To alleviate the current difficulties of the GEG in disposing of fish and
fish products, the VDK agreed to purchase immediately 1.1 million VEs' worth
of fish and fish products.(11)
Fourteen members of a black-market ring who smuggled large quantities of 'cra be npput onetrrrous ial in East Berlin. Thepprincp Berlin
are oOttWest Berlin
driver, and Paul Uwira, trucking firm owner.
o Boehler,htruck
speed,
The members of the ring drove trucks through the zonal barrier at high hout materialstfrom East Berlin, which werelthenrsold tod mTrore a than u) t est Berlin
of
scrap dealer in Berlin-Kreuzberg.(26) PP fn, Wat Berlin
Increased Trade With Underdeveloped Countries
The GDR is interested in obtaining raw materials directly from the countries
in-which they originate. It must therefore increase its trade with underdevel-
oped countries, which, in any case, offer favorable conditions of trade to the
GDR.
The demand of these countries for machinery and industrial installations
has not been met by non-Orbit countries. The underdeveloped countries must
tthher forehf ndtrade partners willing to buy their traditional export goods and sell
em te The Gto is mithe c pi buy goods they need to build up their national economy.
Their cotton, jute, minerals, rubber, fruits, spices, and
products. In return, the GDR will export to countries producing these
commodities not only machinery, precision and optical instruments, and indus-
trial installations, but also equipment such as sewing machines, small motors,
and various tools, which are needed by'tht indigenous industries.
These countries can also have a more favorable payment Orbit countries than with non-Orbit.-countries. Such arrangementsgarrencontained,
for example, in the Soviet and Czechoslovak trade agreements with India.
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s
ould investigate the
n these countries and become familiar with
GDR must not only sell capital goods to these countries, but must also
give technical assists them; (b) the them
n nee, and this technical assistance can take such fo
tech rmsasdis-
g engineers to assemble machinery sold by the GDR su
to instruct the native population in the use and maintenance of these
and sending technicians to introduce new ' pplying personnel
Countries; processes into the industries ofhth machines,
its (c) the GDR must improve its supply of spare these
machinery; and (d) the payments arrangements granted thetheGDR should be
liberalized. This is purchasers
are general. short of cash sufficient for large purchases.(27)
If this increased tradebetween the GDR and underdeveloped countries is to
be wholly succes:fuy, GDR trade Policies must be improved in a number of ways,
including the following: (a) the network of GDR trade representatives in these
countries must be en_arged, and these representatives
economic conditions i
h
KfA Field Offices
In spring 1953, the KfA (Chamber of Foreign Trade) organized field offices
in the Bezirke where important export industries are located. These of-
fices were to advise producers on export problems and were to coordinate the
export activities within industries and between the state forei n-t field of-
prises and industries.
6n-trade enter-
Thus, the field offices arranged for several enterprises to use the same
freight car, when each had a less-than-carload export shipment to the same des-
tination. They also managed to locatr scarce)roduction materials for enter-
prises producing for export.
Experience showed that many of the problems brought offices could best be handled on the Bezirk and Kreislevelsothroug KfA
operation operation of producers, foreign-trade enterprises, and the state administration
the co-
the co-
For this reason, the KfA field offices undertook -,he organ,
committees for individual industries on a Bezirk level.(28)zation of export
EM2 Committees
Each export committee will consist of representatives of the
vate enterprises in the industry concerned and of a representative from each
pri-
of the following state administrati and trade : VEBs and pri-
DIA, Department of Foreign Exchange and Finance ofetheeS Ger field office,
VVB of German Forwarding Enterprises rt (German Bank om competent
Bezirk
Bezirk councils, and eutra ' the planning departments of the co
it was De [was called Derutra (GDR-Soviet TransportationCom-
Dany) (Gorman watransfi red to GDR ownership on 1 January 1954; it is called
information applies to t Company) throughout this report, even when the
representatives trathe (necessary, the committees ma
tofliy include epepre) (Office for
en y be eofaCo -
DBZs, and the State Contracting Cgcys 2nd Each ex oom
mittee will have a permanent secretariat located in theoffices of the
export KfA field office. Enterprises e?m'
compet fA field export of an industry located in a ich noent
committee has been organized may xin which committees
es
for the respective industry through these secretariats. et existing stin
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The, 'export committees are to have the following tasks:
1. Exploration and opening of. new markets.
2. Improved cooperation between producers and foreign-trade enterprises
by means of consultation between these enterprises and representatives of an
entire branch of industry.
3? Cooperation between producers and DIAs in the preparation of exhibits
at foreign-trade fairs.
4? Improved reporting on markets and prices.
5. The elimination of technical obstacles in foreign trade through con-
sultation and cooperation among producers, foreign-trade enterprises, trans-
portation enterprises, banks, and the state administration.(28)
An export committee for precision instructions and: optics for the Bezirke
Gera, Suhl, and Erfurt was organized in Jena on 24 November 3.953. The committee
consists of 26-members, of whom 12 represent the VEBs; 7, private industry; and
7, the state agencies.
Dr Gottfried Lessing, president of the KfA, and Grosskopf (fnu), chief of
the Jena field office of the KfA, were among the speakers at the organization
-meeting. Speakers during the discussion pointed out that the industry should
have foreign-trade representatives abroad. It was also stated that the assort-
ment and quality of the products of the industry must be improved so that these
products will regain their former reputation on the world market.?001
The following additional
Committee
Location
Precision instruments
and optics
Ceramics
Chemicals
Keyed [musical]
instruments
Glass
Dresden
Erfurt
Halle
Leipzig
Ilmenau
December 1953
December 1953
December 1953
December 1953
(28,31,
32)
Textiles
January 1954
(31,32)
Machine building
Karl-Marx-Stadt
Magdeburg
19 January 1954
26 January 1954
Essential oils
Leipzig
27 January 1954
Halle (to be
established)
The GDR industrial ministries are still underestimating the importance of
exports committees. Representatives of the HV (Main Administration) for Precision
Instruments and Optics of the Ministry of General Machine Building [this ministry
was made part of the Ministry of Machine Building on 21 November 1953] were invited
to the organizational meeting of the exports committees for precision instruments
and optics in Jena and Dresden, but they did not attend. Likewise, no representa-
tive of the RV for Glass and Ceramics. attended the organizational meeting of the
Export Committee for Ceramics in Erfurt.(32)
The organizational meeting of the export committee for textiles in Karl-
Marx-Stadt on 19 January 1954 was attended by representatives of the Ministry
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The following customs offices have been established under this regulation:
Berlin N 3, Oranienburger Strasse 70
Cottbus, Sandower Bauptstrasse 4
Dresden A 24, Bayerischestrasse [no number given]
Erfurt, Mao-Tse-tong-Ring 110
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C-O-N-F-I -D-E-N-T-I -A-L
of Finance, the Ministry of Light Industry, and the MAI, Although such matters
were discussed as the financing of exports, a bonus system for exports, invest-
ments for the replacement of motor vehicles, and better material supply, the
representatives of the ministries failed to
ti
par
cipate in the discussion.
Apparently, these representatives were nothing more than mere observers for their
superiors.(31)
VEB German Sea Freight Office
DRS (German Sea Freight Office), a small office directly under the authority
of the MAI, represents the GDR in all matters involving sea transport. Partic-
ularly, it supervises the sea transports of GDR imports and exports and seeks the
most favorable rates for these shipments. The growing GDR trade with China was
the immediate occasion for the organization of the office.
As a result of the GDR's great need for shipping space from China, the
Levant countries, and the Black Sea area, the DKS has become an important customer
of the world's shipping firms.
The DISS far exceeded its 1953 plan for making shipping space for [imported
and exported] mass consumption goods available at the proper time. The DISS also
obtained considerable savings for the GDR, particularly in rates payable in
foreign exchange. The terms of GDR delivery contracts have often been such that
the offices of the DES could not be used. This condition is likely to continue
during 1954.(33)
FOREIGN TRADE PROCEDURES AND CRITICISMS
A new procedure has been establishe f
____. _
the d
e
e export samples, according to a regulation of
14 November 1 f
953? The new regulation became effective 14 November 1953.
The AZKW has established the customs offi
listed - , .
ces
name of the appropriate customs office from this list-on-,sheet Now 11ofethergeneral
export permit. [Presumably such small
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The central production Machine Building has stated that production the
enterprises pMmustt receive eeexp rt
orders at an early date to be able to obtain the necessary raw materials.
In 1953, factories received export orders for the most part not before the
end of the first quarter or in the second quarter. The specifications in many
of these orders were found to be unclear.
The [former] Ministry of General Machine Building, moreover, found it
difficult to obtain a clear picture of the export orders on hand in the factories
because the marketing department of the ministry and the DIA did not cooperate.
DIA was too late in certifying the individual export orders to the ministry.
For this reason, the ministry could not compare the export orders reported by
the factories and the orders certified by the DIAS on a continuous basis.
The ministry intervened in those enterprises in which the fulfillment of
the export plan was threatened. Special working teams were organized, and these
overcame the difficulties in most cases.
Other measures were taken by the [former] Ministry of General Machine Build-
ing on the basis of the decision of the Council of Ministers of 14 September 1953
regarding the fulfillment of the export plan. The production managers and the
marketing departments [of the production enterprises) were directed by the central
production department to start production on all export orders. These were to
be completed by 21 December 1953. The officials of the production enterprises
were to determine and analyze the production status of each of these export orders.
On the basis of these surveys, measures were to be taken to speed up and facilitate
the production of these items. Exchanges of raw materials between plants were
undertaken, and the ministry helped in securing raw materials which were lacking.
When an enterprise lacked production capacity, a transfer of the export order to
another plant was arranged. The DIAs were informed of needed raw-material imports,
which had not yet arrived. A system of priorities was established in consultation
between the ministry and the various DIAs.(30)
Criticisms
The export committees [organized in December 1953 and January 1954] made
the following suggestions:
Gera, Amthorstrasse 11
Halle, Ernst-ICamieth-Strasse [no number given]
Karl-Marx-Stadt, Strasse der Nationen 78
Leipzig C 1, Johannisgasse 7
Ludwigslust, at the railroad station.
Magdeburg, Praelatenstrasee 5-6.(6)
Measures to Fulfill Export Plan
1. The voluminous and time-consuming paperwork required under the exist-
ing export procedure should be reduced.
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2. The planning system should be more flexible. Planning is insufficiently
coordinated and balanced. Production plans must be so elastic that the export
contracts concluded by DIA can be fitted into them at a late date.
3. The work of the transportation industry should be improved. Freight
cars are often unavailable, and the export commodities are en route too long.
4. The producing enterprises should be informed regularly of market
conditions and prices.
5. The producing enterprises should receive foreign technical journals
regularly.
6. Imported commodities should be stockpiled to assure steady and even ex-
panded production.
7. The work of DIA should be improved, especially in respect to the follow-
ing complaints: inquiries are handled too slowly; personnel lack technical knowl-
edge and market information; prices are set without regard to the competition.
8. The producing enterprises should appoint foreign representatives and
have direct contact with them.
9. Restrictions on foreign travel by representatives of producing enter-
prises should be eased.
10. Easier.payment terms should be given, particularly in case of goods
sold on credit.
U. There should be wider participation in foreign fairs and exhibitions
by GDR producers. Exhibitions should be held by individual producers.(32)
H. Gaertitz, an official of the Ministry of Light Industry, stated that
cooperation between the MAI and the Ministry of Light Industry has consisted
of monthly conferences in which representatives of the DIAs, the marketing
department, and the technical departments of the Ministry of Light Industry
participated. These conferences have been successful and should be continued.
Export orders, completion of which was imperiled, were discussed, and the re-
presentatives of the two ministries jointly decided on measures to assure the
delivery of these export orders on schedule.
However, these conferences dealt only with export orders completion of
which was not assured. It is necessary that the two ministries cooperate to
arrange in advance for the production of export orders. To this end, the DIAs
must transmit their export orders to the production enterprises at an early
date. In addition, the DIAs should conclude an annual general contract with
the Ministry of Light Industry for the entire quantity of light-industry prod-
ucts to be exported.
Light industry fulfilled its 1953 production program for export goods by
97 percent on 30 November 1953. It is DIA-s fault that it, did not export the
same quantity of product manufactured by ].ight industry.
The Ministry of Light Industry attributes the following operational faults
to the DIAs in their dealings with production enterprises: The DIAs submit
their export orders to the production enterprises so late that the latter do not
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An effort is being made to improve cooperation in 1954. Representatives
of the Ministry of Light Industry and of the DIA for Textiles are consulting
frequently.(28)
GDR industrial enterprises producing for export have complained that they
have difficulties because of the following failings in the foreign-trade pro-
cedure:
1. There are frequently discrepancies between the provisions of the EA
an ththhe EWBS (Export Bill of Lading), particularly respecting the delivery date. facto in the EA for sulansuitslprroddcction schedule on the basis of a delivery be placed in a position where it mustweitherhincur heavy expenses ~ tv igthe order on time, or it must let the EWBS lapse and incur xhersd to deliver
obtaining a new one. further delays in
n
2. There are often long delays between the time when the producer is
first informed of a pending export order and the time the EA is finally sent
to him by the DIA.
3. The EA sometimes does not allow the time necessary for production,
as the producer had indicated it on the proforma invoice submitted by him in
response to the initial inquiry.
4. In other cases, export orders were produced on receipt of the FA; but
no EWBS for them ever arrived. As a result, these commodities stayed in ware-
houses for months and tied up the operating' funds of the enterprise. '
to be It made suggestedethatithefEA and the EWBS be combined into a single form,
original agreement between producer pannddu[fr s g invoice, which is the
foreig nn) ] cust customer.
GDR foreign trade has also been hurt by delays in the granting of IWBS
(Import Bill of Lading) for GDR products returned to the manufacturer for re-
pairs and service. Producers of cameras and X-ray equipment, whose repair
service competes with that of foreign producers, have been particularly hurt
by these delays-04)
have the production capacity in the short time before the end of the year to
complete the efxport onrders. Export orders submitted he tted by the necessary DIM often lack
ccurate speciicatios DIAs fail to furnish
once orders have been completed.
a shipping papers
C-O-N-F-I -D-E-N-T-I -A-L
SOURCES
1. Taegliche Rundschau, 16 Feb 54
2. Die Wirtschaft, 19 Feb 54
3. Der Aussenhandel, 8 Dec 53
4. Neue Zeit, 5 Feb 54
5. Taegliche Rundschau, 14 Feb 54
6. Der Aussenhandel, 26 Jan 54
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7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33..
34.
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Neues Deutschland, 27 Sep 53
Taegliche Rundschau, 21 Oct 53
Ibid., 19 Dee 53
Ibid., 9 Feb 54
Ibid., 17 Feb 54
Ibid., 13 Nov 53
Ibid., 27 Feb 54
Ibid., 24 Nov 53
Ibid., 2 Dec 53
Ibid., 20.Feb 54
Ibid., 26 Feb 54
Die Wirtschaft, 11 Dee 53
Ibid., 8 Jan 54
Taegliche Rundschau, 26 Nov 53
Die Wirtschaft, 29 Jan 54
Taegliche Rundschau, 4 Mar 54
Die Wirtachaft, 12 Feb 54
Ibid., 5 Feb 54
Neues Deutschland, 13 Feb 54
Taegliche Rundschau, 15 Jan 54
Der Aussenhandel, 16 Feb 54
Ibid., 22 Dec 53
Die Wirtschaft, 20 Nov 53
Der Aussenbandel, 1 Dec 53
Ibid., 2 Feb 54
Die Wirtschaft, 22 Jan 54
Der Aussenhandel, 5 Jan 54
Ibid., 8 Sep 53
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