JPRS ID: 9872 EAST EUROPE REPORT ECONOMIC AND INDUSTRIAL AFFAIRS

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• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000400030053-6
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• Document Creation Date: November 1, 2016
• Sequence Number: 53
• Content Type: REPORTS

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.;PRS L/9872
29 July 1981
E~st Euro e Re or1~
p. p
ECONOMIC AND INDUSTRIAL AFFAIRS
CFOUO 7~'81)
FBIS FOREIGN BROADGAST INFORMATION SERVICE
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JPRS L/9872
29 July 1981
EAST EUROPE REPORT
ECONOMIC AND INDUSTRIAL AFFAIRS
(FOUO 7/81)
CONTENTS
INTE~~IVATIONAL AFFAIRS
Participation in CEMr1 Machine Building Industry Reflects Negativr~
Signs
(Vasil Kalchev, Mariana Vitkova; IRONOMICHESKA MISUL, No
1981)
1
CZECHOSLOVAKIA
- Progress of Automation in CSSR Discussed
(TECHNICKY TYDENNIK, 14 Apr 81) 12
' a - [III - FE - 64 FOUO]
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INTERNATIONAL AFFAIRS
PARTICIPATION IN CEMA MACHINE BUILDING INDUSTRY REFLECTS NEGATIVE SIGNS
Sof ia lKONOMICHESKA MISUL in Bulgarian No 2, 1981 pp 26-36
[Article by Vasil Kalchev and Mariana Vitkova: "Bulgaria's Participation in Inter-
national Production Specialization and Cooperation in Machine Building"]
[Text] International production specialization and cooperation (MSKP) is one of the
basic forms of foreign economic relations which expresses the developmemt of integra-
tion processes among CEMA-member countries. It is an essential �eature of the
international socialist division of labor in the course of its practical implementa-
tion as the economic foundation of socialist integration.
International product specialization and cooperation is a comprehensive form of
cooperation and integration which applies mainly to the production area. Its descrip-
tion as nothing but a form of production integration, however, would be incomplete.
It has a major impact on trade and is achieved through the foreign economic exchange
of commodity-material values among CEMA~nember countries. The effect of the MSKP on
market relations follows the direction of increasing their stability and their long
term and reciprocally prof itable nature. That is why the development of production
specialization and cooperation processes is a major prerequisite in improving the
international socialist marketplace. Furthermore, conditions of the international
market are an important element of the practical implementatiun of the MSKP. They
could stimulate the development of its processes but may plan a restraining role as
well.
The assessment which could be made of the level of development reached by the MSKP
should be linked above all to its influence on the national reproduction process.
Obviously, in the case of smaller countries, which include the Bulgarian People's
Republic, this influence is relatively higher. Indeed, the 230 agreements for MSKP,
which our country ha.s concluded on a multilateral and bilateral basis with fEN1A-
member countries, largely determine its economic specializations. On the basis of
such agreements Bulgaria has specialized in the production of more than'700 types of
machine building goods and of many items in other industrial and agricultural sec-
tors .
The permanent geographic characteristics of Bulgarian foreign trade, whose main ex-
ports (from 76 to 78 percent for the 1970-1979 period) go to CEMA -member countries
and which, in turn, accounts for the predominant share of Bulgarian imports (from
71 to 80 percent for the 1970-1979 period) is becoming increasingly related to this
specialization.l
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For th~ growing interdependence between the development of the Bulgarian e,.~nomy and
its participation in the process of the international socialist u~~ision of :iabor is
confirmed also by the ratio between the value amounts of foreign trade with CEMA-
member countries, including the USSR, and the country's national income. Whereas
this ratio equalled 31.7 percent in 1970, including 22.6 percent with the USSA, it
reached 64.3 and 46.6 percent, respectively, in 1978.2
The share of machine building items predominates in the overall exports of special-
ized and cooperated items produced by our country, accounting for more than 90 per-
cent of the total. Some basic production lines of specialization in machine building
are of essential significance: hoisting facilities, electronic and electrical engi-
neer?--o g~ods, metal cutting machinery, tractors and agricultural machinery. The
basic indicators of their role in the national economy is the relative share of ex-
ports of such goods in the overall volume of their output. In recent years, it has
- exceeded 80 percent for electric motors, electric hoists, fork lift trucks and trac-
tors, and more than 90 percent for typewriters and gas operated lift t~rucks.3 More
than one-third of Bulgar,ia's overall exports of machines and equipment are machine
building goods prociuced on the basis of bilateral and multilateral specialization
(including more than 45 percent of machines which are exported to CEMA-member coun-
tries). These data are indicative of the major role of iAternational specialization
and cooperation with CEMA-member countries in the development of the Bulgarian eco-
nomy, including Bulgarian foreign trade.
Bulgaria's active participation in the MSKP is the result mainly of the highly dy-
namic development of machine building output and exports. Thus, between 1960 and
1978, the production of machines and equipment in Bulgaria rose at an average annual
rate of 13.2 percent, while export to CEMA-member countries rose by 33.4 percent.4
The dynamic development of exports of specialized items contributed to tne reaching
_ of such a high pace of machine building exports. This was particularly characteris-
tic of the 1970s, when such exports increased by a factor of roughly 7;. in other
words, it increased at a faster pace than that of machine building output of CEMA-
member countries.s .
The structure of exports of specialized goods is i.mproving along T~~:ith the develop-
ment of its highly dynamic nature. The share of goods produced by the electronic
and electrical engineering industry has increased while tha.t of more material-
intensive specialized items included in the production of lifting-transportation
machinery, transport facilities and agricultural machinery, correspondingly declined.
Between 1970 and 1979 the share of electronic computers in the overall volume of
exports of specialized machines and equipment for industrial purposes rose from 0.6
to 21.2 percent; of electrical engineering machines, from 0.3 to 6.9 percent; and of
communications equipment, from 0.3 to 6.8 percent. Within the same period, the share
uf hoisting-transport machinery declined from 65.5 to 42.3 percent; of tractors and
agricultural machinery, from 22.1 to 5.8 percent; and of transport facilities, from
10.3 to 7.6 percent.6
This brief generalized study shows that good results were achieved in the development
of NiSKP proc~esses and in our participation in them in the 1970s. The task now is to
consolidate the successes and raise the MSKP to a qualitatively new Ievel. We can

- reasonably expect that the period through 1990 and through the end of the century will
be characterized mainly by the develooment and intensification of the MSKP in the area
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of reciprocal cooperation with CII~fA-~memher countr,ies. What will the position of our
country he and what will be the main directions of its futsre participation in this
process? In this respect the elaboration of a scientific concept on the further in-
volvement of the country within the MSKP is of ma~or importance. The considerations
which we shall express here are related to the long-term elaboration of this concept,
whose detailed development must be taken up by a large group of scientific w~orkers
and practical specialists.~
Production (including social) and foreign trade factors must be considered in the
development of this concept. The u~ost important among the production factors are
available domestic material resources; the condition of the manpower balance (labor
skills, trends in wages and incentives, and others); the established productio~ base
and its utilization (including problems of its long-term development, modernization
and reconstruction); scientific and technical support for participation in MSKP,
which presumes giving priority to the development of scientific and technical pro-
gress sectors directly related to the areas in which our country is specializing;
and the domestic needs of the country for a specific commodity.
The following foreign trade factors are determining: existence of a permanent need
by CEMA-member countries for goods in which we are specializing; availability of a
large and stable market, which presumes extensive foreign trade studies fc;i the sub-
stanti.ation of eacYi~ suggestion for MSKP; high export effectiveness of th~a goods in
which a country is specializing or cooperating along the line of CEMA or o*.~ a ~i-
lateral basis; possibilities of importing material resources lacking in the couittry
(raw materials, fuels, materials, investment equipment and others, including a break-
down by country), and others.
The directions of the long-term participation of the cour~try in the MSKP must be de-
fined in accordance wi.th the comprehensive influence of industrial and foreign
trade factors.
In this connection, we must begin by determining the lines and products of specializa-

, tion of the country. We believe this to be a problem related mainly to our produc-
tion possibilities (developed capacities, available resources and others). It is .
essentially on the basis of this criterion that the tendency to undertake a large
number of international specializations is developing in our practical work, many of
which remain unimplemented or else are carried out unsatisfa;.torily. With such an
approach a smaller country cannot utilize the advantages offered by the MSKP related
- to production concentration and improvements in technical and economic indicators.
In the final account, this makes the producers lose interest and yields unsatisfac-
- tory foreign trade results.
The rough assessments which some authors in socialist countries have made$ indicate
that currently the level of concentration and international specialization of soa~e
items produced by CEMA-member countries remains inadequate. The rationalization of
the machine building structure on a national scale has not been completed and a
great variety of goods are~still being produced; a certain lack of coordinati.on exists
between scientific research and technical development; items the production facilities
for which remain insufficiently developed are still being included in a substantial
number of specialization and cooperation con~racts, as a result of which they account
for an insignificant amount of the overall machine building output exported by the
individual countries.
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The study of our pr�actic.al experience in reciprocal cooperation indicates the con-
tinuing existence of cases of partial or total nonfulfillment of stipulation~ on the
= exp~rt of specialized machines, in terms of volume anc. variety, violations of coor-
dinated delivery agreements, mainly in terms of delays, unrhythmical deliveries of
specialized goods and spare parts to consumers, deliveries of goods inconsistent with
coordinated quality indicators, slow technical renovation of offered specialized
- goods, and so on. Such phenomena may be frequently found in our work as well.
As we pointed out, when one or another direction is chosen for the participation of
our country in the MSKP, along with the objective asses�ment of real production op-
portunities we must co~nsider mandatory foreign trade criteria such as expected
effectiveness from the export of specialized goods; need for additional imports of
raw materials, fuels and materials; facilities for the reconstruction and moderniza--
tion of existing production capacities on a modern technical level and tiie building
_ of new ones (under our circumstances this is related to imports of investment equip~
ment which is in short supply on the international socialist mar.ket) and others. In
this c^nnection the formulation of a reliable method with which to determine the
effectiveness of participation in the MSKP is an important task. The study of the
methods and indicators used in our practices for the determination of this effec-
tiveness has indicated the insuff iciently representative nature of the result, the
mixing and double consideration of results in the industrial and foreign trade areas
and others.
The interconnection between the development of the Bulgarian economy and the process
of international socialist division of labor covers all the stages of the reproduc-
tion ~rocess to a rising extent. That is why the foreign trade intensification indi-
cators alone would be insufficient for the purpose of assessing the extent of parti-
cipation of the country in the international socialist division of labor and the in-
tensiveness of its foreign economic relations. We must make an increasingly exten-
sive use of indicators which equalize the level of concentration and the extent of
international specialization in the manufacturing of individual commodities. In this
respect it is difficult to achievE precise international comparisons, for the process
of concentra.tion is affected by a variety of factors. In most CEMA-me~ber countries,
however, including Bulgaria, currently only individual types of specialized output
_ can reach optimum dimensions in terms of their volume on an international scale. The
" inevitable conclusion is that we require further ~.~ncentration of resources and the
- uridertaking of broad scale specialization based on the integrated marke~ of CEMA-
member countries, the USSR market essentially.
Another important problem is that of the choice of the form and type of the chosen
productior. specialization. Our country's experience indicates that "traditional"
item specialization in the production of finished goo3s has become most Fxtensively
developed. Ir_ has the advantage of provjding relatively extensive opportunities for
flexib:il.ity in commodity marketing. Obviously, the other CEMA-member countries as
well operate on this basis i.n choosing their form of participation in tha~MSKP. Fur-
thermore, both publications and written materials of CEMA agencies quite justifiably
_ indicate the negative consequences of the existing parallelism in the production ac-
, tivities of individual countries. This limits the possibility of using the advan-
tages of the international production concentration as a factor for upgrading its
eFfectiveness considerably.
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The historical approach to the evolvement of the global socialist system, however,
shows that under the conditions in which most CEMA~aember countries are developing
their own nat3onal economic complexes and in the absence of an integration system
for controlling the international socialist division of labor, production duplica-
tion is inevitable. Furthermore, it is precisely the existing duplication on the
macro level which could and should become the base on which integration processes
within the individual material production sectors of CEMA~member countries could
develop in the future on a highly effective basis. This can only be achieved
through the exCensive d~veYopment of international production cooperation.
We know that in order for two or more countries to cooperate in production they
must have develop~d their respective production sectors or line~. This is a ques-
tion of a type of future development which would use the already developed struc-
tures and, at the same time, adapt production capacities to the requirements for
close industrial cooperation with the other countries. In other words, from a
~ ~pecifically national production it must become integrated, highly effective and
optimized. The current inadequate development of cooperation relations among CEMA-
_ member countries is consistent with the initi.al stage of integration in which they
are. The future belongs to international socialist cooperation, which wi11 be de-
veloped on the basis of parallel production capacities in individual CEMA member
countries. The extensive development and utilization of the advantages of inter-
national production cooperation9 requires a coordination of the structural quality
of each individual country as a basis for the establishment of profound and lasting
_ relations in individual material production sectors. Clearly the currently used
mechanism which controls and regulates international cooperation should have to he
improved as well with a view to ensuring the active stimulation of this process,
taking into consideration the long-term nature of such cooperation and stability
and reciprocal advantage requirements.
The creation of the necessary prerequisites for the extensive development of pro-
ducticn cooperation with CEMA member countries must be undertakPn �irmly and on a
broad scale in order to surmount the situation, abnormal in our view, in which the
assemblies and parts which CEMA member countries currently trade among themselves
account for less than one-fif th of the volume of the specialized output. That is why
the question of Bulgaria's position in the process of international socialist produc-
tion cooperation is quite important. The isolated examples of our participation in
= cooperation with CEMA member countries have indicated a more or less one-sided direc-
tion in which we supply assemblies and parts which are put together in other coun-
tries. Effectiveness requirements are also related to the study of opportunities
and the promution of initiatives for the organ3.zation of assembly work and the pro-
duction of finished goods in our country. This is based on the consideration that
it is more advantageous to praduce some types by countries with better resources
(metal mainly). This particularly applies to our cooperation with the USSR from
which, instead of inetal, i~ would be obviously more advantageous from the viewpoint
of transportation expenditures to ~rocure metal intensive assemblies and parts.l~
However, this does not exclude our further participation in internationa]. production
- cooperation through deliveries of complementing items, assemblies and parts. In thi~
area requirements concerning quality will be rising steadily. This will demand the
use of most advanced technologies and technical solutions, including those which must
- be procured from the capitalist countries. Hence the need to develop in our country
such special.ized production capacities involving the financial participation of inte-
rested CEMA-member countries. Such participation could be achieved through the
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opportunities offered by cooperation in joint dPliveries of fin~shed products, in-
cluding shipments to capitalist markets.
The problem of the structure (variety) of specialized items which are exported and
imported is related to the choice of directions in participation in the MSKP. In
such cases the conditions of our country presume, along with the require,-nents of
general national economic and foreign trade effectiveness, the giving of priority to
variants w~iich are relatively less material and energy intensive. It is precisely
such sectors and production facilities that should shape the future integration as-
pect of our economy. The country's structural policy should be based on the faster
development of the production and export of computer and o~~'^~ ~nuipment, electronic
el.ements, industrial radioelectronics, instruments an~? means of automation and other
electronic and electrical engineering products in wt;ich our participa~ion in the MSKP
with CEMA-member countries would be concentrated.
Studies have indicated that currently Bulgaria has one of the h~ghest material inten-
siveness (metal intensiveness) per one million rubles of machine building output
among all CEMA-member countries. Difficulties in future procurem~nts of raw materials,
fuels and materials require that the share of lifting-transport machine building be
gradually reduced in the export struc~ure of our machiae-building industryll re-
gardless of its good export indicators. We must also improve quality indicators and
make efforts to lower metal expenditures per unit of foreign exchange incame from
lifting equipment exports.
The possibility of developing new specialization and cooperation areas by assemblies
and parts within the framework of the already developed general specialization in a
- ~iven area offers substantial opportunities for the intensification of our export of
specialized items. It is a question of diversifying specialized goods and broadening
the range of specif ic goods produced (aimed at eventually covering the entire range
of parameters). This is particularly important in:terms of the renovation and mo-
dernization of specialized commodities, with a view to taking achievements into con-
sideration and quickly applying the results of scientific and technical progress.
Opportunities for expanding the export of such goods exist in our newly developed
items which still remain outside the PSSKP with CEMA-member countries. This includes
the production of nonstandard equipment, heavy investment machine building and robot
manufacturing. The production of trucks will offer opportunities for the establish-
ment of cooperation relations in the years to come.
In choosing the directions of imports of specialized commodities we must give priority
(taking into consideration the economic interests of our partners) to relatively less
material intensive production facilities, to goods considered carriers of technical
_ progress and to high quality and one-of-a-kind machine building goods whose produc-
tion cannot be mastered by our country or else involves high expenditures. In practi-
cal terms, this means that we must determine our import needs accurately and intensi-
fy the participation of foreign trade organizations which must provide studies of the
market situation and trends in the development of international markets, suggestions
for imports, including imports through the MSKP system, and others.
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The territorial aspects related to the choice of the country Fti.th which ~~e must
specialize and cooperate in the production of specific items is o~ great importance
in determining the directions of our future participation in MSKP in tre strea of
- machine building. Data from ~he development of the MSKP so far reveal an interesting
pattern in our reci~rocal imports and exports of specialized items. In thE~ case of
the USSR, bilateral specialization and cooperation accounts for a considerable share
- of the total; with the other CEMA-member countries multilateral imports and exports
dominate (with a general trend toward increasing the share of multilateral special-
_ ized output).12 This pattern is explained by the generallq higher level of our
bilateral relations with the USSR and the special attention which both countries pay
to the evolvement of comprehensive cooperation and rapprochement. This process is
objectively based on the po~aerful complex of the USSR which enables smaller enun-
tries to aptimize their production through the evolvement of their specialization and
cooperation mainly with the USSR.13
Bilateral specialization and cooperation with the USSR will continue its rising in-
~ fluence in the future. The main stra.tegic directions were defined in the general
plan for specialization and cooperation in basic material production sectors thr.ough
1990. Along with bilateral cooperation with the USSR, in the course of improvements
in CEMA activities and of the development of socialist integration, the significance
of multilateral forms, i.e., of multilateral MSKP, will continue to rise. Under such
circumstances, sub~tantiations for bilateral offers and contr,acts for MSKP with :indl-
vidual CEMA-member countries (excluding the USSR) will become stric~er. Bulgari~i
should proceed from the possibilities of the markets of the individual CEMA-membf~r
countries and of cooperating with such countries in exports to third markets; thE~
. results achieved by the corresponding country in the development of a given item and
its scientific and technical potential in this area (including the technical stan-
dards of output, possiblity of jdint licensing and others); possibilities of joiiit
procurement of resources for the production of specialized items; and the overall con-
dition of bilateral trade and payment relations.
Generally speaking, the promising ways of participation of our country in the MSKP
on a multilateral basis through 1990 are related to the implementation of the long
term target program for cooperation (DTsPS) in machine building. Its 12.~subprograms
include more than 100 specific measures, one-third ef which deal with production
specialization and cooperation while the remainder are related to the developmeilt.of
new production capacities, scientific and technical coogeration arid standardization.
The DTsPS calls fflr the intensification of intra-sectorial specialization in machine
building, above all, with its ever more effi.cient expan:;ion in terms of assembly,
part and technological specialization and, on this basis, expanded cooperation in
the production of machine building items. Such development of the most progressive
. ~orms of division of labor among CEMA-member countries faces our participation in the
MSKP with serious requirements. Its results should be the following:
Increasing the possibilities of machine building in terms of the acceleration of'
scientific and technical progress, based on intensive scientific and technical and
_ industrial cooperation among CEMA-member countries;
Enhancing the role of machine building as a basis for raising the technical standard
and effectiveness of the most important economic sectors. Under our circumstances
this is related to the development of machine building at a faster rate;
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Increasing the volume of machine building output within the framework of CEMA by a
factor of two between 1981 and 1985 and b a factor of three between 1986 and 1990
compared with the current five-year plan.~4 This raises important requirements re-
~ lated to upgrading the quality indicators of our specialized output;
Increasirig production concentration and reducing the variety of specialized goods
while, at the same ti.me, expanding MSKP processes to new sectors and items.
The implementation of ineasures ~.~rdinated with a DTsPS takes place under the con-
ditions of the increasingZy long-term nature of recipro~al industrial and scientific
and t~chnical cooperation and of the enhanced role of the economic approach in the
solution of basic national economic problems. These are the factors which will have
a:i increasing influence on and formulate n~w requirements regarding the comprehensive
improvement of production cooperation and specialization processes, an important ele-
ment of which are reciprocal procurements of specialized and cooperated items.
One of the means for st~ulating Bulgarian participatior. in the MSKP is the ever more
extensive use of the program-target and comprehensive approach to the MSKP control
mechanism. In this connection, under the conditions of the DTsPS, the following
basic features must be taken into consideration:
First, we must er_sure a growing material interest on the part of economic organiza-
tions to participate in and strictly meet their obligations based on i?-.ternational
. contracts, through the ever fuller utilization of the economic approach in foreign
economic activities. This means to stimulate the initiative and to upgrade the re-
- sponsibility of all industrial and foreign trade units in the fulfillment of inter-
national obligations.
Second, the development of an economic interest in taking steadily into considera-
tion the specific requirements of the international market and the material responsi-
bility of the organizations which are parties to contracts for international produc-
tion specialization and which must take into consideration the stricter requirements
of this market in terms of the marketing of their commodities and stimulate their
quality improvements more effectively. For this reason it would be expedient for the
amount of export bonuses to be made more flexible and dependent on the results of a
- comparative analysis of technical and economic data of an item produced domestically
and its foreign r.ounterparts and take more fully into consideration the effectiveness
of outlays related to quality improvements.
Third, we must intensify the role of material liabilities for violation of contrac-
tual obligations on the part of foreign trade organizations in charge of marketing
operatively produced items.
Fourth, the long range na*ure of the DTsPS will result in formulation of stricter re-
qt~irements regarding eseablished forms of planning and implementation o� foreign eco-
nomic relations and related to reciprocal procurement of specialized and cooperated
goods on a long-term basis, and stricter requirements concerning the quality and con-
stant technical updating of co~nodities.
Prices and price setting are important problems in term~ of the long range develop-
ment of the MSKP. Prices for specxalized and cooperated items are set on the basis
of the joint price setting principles and methods adopted at the Ninth CEMA Session
(1968). According to its method contractual prices, including-those of t~e MSKP,
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- are based on prices charged at the main cowmodi.ty maxkets 3.n the world. This price
setting method, applied to goods subjected to MSRP contracts, has its advantages and
shortcomings. Its advantages are the following:
1. General proportions regarding exchange and equivalency of t:-ade are assured through
the utilization of a uniform approach. Different quantities and shares of specialized
items in the exports of individual countries make it necessary to cover the trade
balance from trade in specialized items with conventional trading items. Similarly,
the positive balance is used to cover general obligations to countries participating
in the multilateral system of payments. Our country has a positive balance from
trade in specialized items. This circumstance is important in determining its inte-
rest in the use of uniform price setting principles. Also along this line is the
requirement that annual changes in contractual prices (adopted with a resolution
passed at the 70th meeting of the CEMA Executive Co~ittee) apply to specialized
and cooperated goods as well;
2. A no less important circumst~nce is the fact that prices on international markets
are an objective criterion for the adoption of effective alternatives for the develop-
ment of production forces and for the participation of the country in the MSKP. This
- criterion is used by_the other CEMA-member countries as well and this uniform approach
is of equal importance in this case; .
3. As a whole, these prices encourage the use of the acfiievements of scientific and
technical progress and the enhancement of the quality characteristics of goods which
are subject to the MSKP;
4. Another important circumstance is that the CEMA-member countries are focussing to
a rising extent on the adaptation of their economies to the require~ents of the inter-
national markets. To t~is effect their domestic ~;.ices are beginning to be tied to
the prices charged on these markets in varying degrees.
The shortcomings of this price setting system include diff iculties in the choice of
a representative price (because of the great variety in machine building output and
the diff ~rentiation in technical and economic parameters), as well as difficulties
which have to do with price correlations among different machines and equipment which
make the production of a given machine advantageous to a1Z CEMA~ember countries and
that of anot::er, unprofitable. This could hold back MSKP processes. The negative
effect of this factor can be surmounted by increasing the level of planned interaction,
in the course ~f which the specialization of each CEMA-~member country is determined
jointly.
Despite the existence of some shortcomings in item specializa+:ion, it would be ex-
pedient to retain the current price setting principles also because of the fact that
the use of global prices as a basis essentially rests on the level of specialization
_ characteristic of leading companies in a given area.
_ The prablem of price setting in international production cooperation has very speci-
fic features. It helps to create a relatively autonomous system for the exchange of
assemblies and parts for the finished goods made of them. Consequently, the problem
here is typing the prices of assemblies and parts to those of the finished good. The
creation of a functional tie between these twro types of prices will provide the
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necessary prerequisites for the surmounting of eventual contradictions between the
possibilities of profiting ~rom the various advantages offered by the M.SKP for the
producers of assemblies and parts and the producers of finish.ed goods. This will
sCimulate the development of international production cooperation. A number of
methods may be used in the establishment of such functional relatious: the norma-
- tive method, the method of breaking down the world price uf a given commodity, the
method of percentages and others. In current price setting practices, the breakdown
_ method is preferable. In this case the price of the f inished good is strictly based
on its international price.
The price setting of spare parts has its specific features as well. The problem of
e~:suring the availability of a sufficient volume and variety of spare parts for spe-
cialized machine buil.ding items traded among the countries is becoming a serious fac-
tor which restricts the development of the MSKP. Its solution depends largely on
the setting oi prices (in accordance with world practices) at a higher 1eve1 compared
to the corresponding assemblies and parts of which the finished item consists.
The economic considerations for this are related, above all, to the fact that the
expenditures incurred by producers of spare parts are, as a rule, considerably higher.
Given the current price setting principles, however, they are not taken into con-
sideration. This does not stimulate the solution of this topical problem. The
hi~her expenditures incurred by the producers are mainly the result of objective
reasons. They are caused by the production of small series of spare parts by non-
specialized enterprises (particularly after a given model is no longer produced),
additional warehousing costs, special packaging, and so on. In our view, such ex-
penditures should be recognized on the international socialist market as socially
necessary lauor outlays and be expressed in relatively higher prices of spare parts
for specialized machines and equipment compared with prices of similar complementing
assemblies and parts.
Signed to press on 18 December 1980.
FOOTTIOTES
l. Co~puted on the basis of data of "Statisticheski Spravochnik" [Statistical
Reference Book], 1980, p 35; "Vunshna Turgoviya na NRB" [Foreign Trade of the
Bulgarian People's Republic], 1980, pp 30-32, 34.
2. Computed from "Vunshna Turgoviya na NRB," 1980, p 34.
3. Computed from "Vun~hna Turgoviya na NRB," 1980, pp 48-63; "Statisticheski
Spravochnik," 1980, pp 100-102.
4. "Ekonomicheskoye Sotrudyichestvo Stran-Chlenov SEV" [Economic Cooperation Among
SEMA-Member Countries], Moscow, 1980, p 62.
S. Computed from "Vunshna Turgoviya na NRB," 1980, p 26.
6. Computed from "Vunshna Turgoviya na NRII," 1980, p 27.
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_ 7. Senior Scientific Associate St. Stoilov has made a successful attempt in des-
cribing the long term trends of our participation in the MSK~ in the collective
_ monograph, "Mezhdunarodna Spetsializatsiya na Proizvodstvoto. Vuprosi na
Efektivnostta" [International Production Specialization. Problems of Effective-
ness], Partizdat, Sofia, 1978.
8. K. Morgenshtern, "International Production Specialization and Its Concentration
in CEMA-Member Countries," VOPROSY EKONOMIKI, No 2, 1978; Ye. Karlik and
Yu. Kormnov, "Production Concentration and Specia.lization in CEMA-Member Coun-
tries," VOPROSY EKONOMIKI, No 8, 1980.
9. Speaking most generally, these advantages are related to the concentration and
organization of the production process on an optimal scale, the establishment of
stable production and technological relations among partners, with standardiza-
tion of requirements concerning the quality of ouzput, joint scientific and tech-
nical and development activities, joint trading on third markets and others.
10. "Mezhdunarodya Spetsializatsiya na Proizvodstvoto. Vuprosi na Efektiunostta"
[International Production Specialization. Problems of Effectiveness],
Partizdat, Sofia, 1978, p 53.
11. Exports of hoisting-transportation machinery will continue to grow in terms of
absolute volumes. This makes topical the problem of improving their internal
structure. In our view, we must increase in the future the share of complete
systems for intra-plant transportation, based on individually designed systems.
This will considerably improve foreign trade results and lower metal intensive-
ness.
12. These computations apply only to machine building goods whose production has been
specialized on the basis of contracts. This criterion (the existence of a con-
tract for MSKP) is used regardless of its insufficiently representative nature
("NRB v Mezhdunarodnoto Ikonomichesko Sutrudnichestuo i Sotsialisticheska
Integratsiya" [The Bulgarian People's Republic in International Economic Coopera-
tion and Socialist Integration], Bulgarian Academy of Sciences, Sofia, 1979,
p 159) .
13. The fact that in terms of value an agreement for MSKP between the USSR and the
CEMA-member countries is higher by a factor of about three compared with average
indicators within the CEMA system is no accident. It confirms the desire of some
countries to make use of the advantages offered by the large Soviet potential
(market), as a result of which they ach3.eve production concentration and more
favorable production and foreign trade results. (Data based on the report sub-
mitted by the VNIKI at 21sC Economic Conference, Warsaw, October 1980).
14. MEZHDUNARODNAYA ZHIZN', No 9, 1979, p 28.
Copyright: Ikonomicheski institutna BAN 1981
c/o Jusautor, Sofia
5003
CSO: 2200/110 '
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~ CZECHOSLOVAKIA
PROGRESS OF AUTOMATION IN CSSR DISCUSSED ~
Prague TECHNICKY TYDENNIK in Czzch 14 Apr 81 p 7
[Article: "How Automation Is Progressing"]
[text] The creators of our Czechoslovak JPR 12 program control units in the Tesla "
Elstroj and Tesla Strasnice enterprises did not anticipate in 1975 what immense
scope their undertaking would acquire in 3 mere 5 years. In cooperation with the
f irst users and on the basis of operating tests, the development work proceeded so
far that there arose a special "set of units for automated data acquisition,"
abbreviated SAPI, and by the end of 1980 various sectors of our national economy
had already acquired 570 configurations of this set. It suddenly grew into the
most widely used control system in Czechoslovakia because of its modular design,
universal applicability and technical parameters. An extremely broad range of
control systems can be built up from the components.
Components in the Set
In ad.dition to the JPR 12 basic control units (which are in essence 16-bit mini-
computers with an 8 Kbyte memory expandable to 32 Kbyte), the SAPI set includes
many other components. All of them were developed by our Tesla enterprises, are
in product:ion and are currently sold by the Tesla E1tos sectorial enterprise. They
include an interface between the PKL keyboard and the EC 0101 alphanumeric keyboard,
an interface between the PDZ teletypewriter and the T 100 teletypewriter, digital
inputs and dynamic digital outputs, an interface for the PSS punch-card reader,
counters, sensors, JPD data-transmission units, universal interface boards for the
- DZM 180 printer, JPS interface units for remote measuring and display, and the TRP
data-transmission terminal for interfacing with serial I/0 equipment at distances
up to 20 kilometers.
Interesting Applications
The SAPI equipment has found its way into an extremely wide variety of areas,
because its supplier has very purposefully organized programmer training in the
Tesla Promes plant in Pardubice and provides the users with detailed, basic,
comprehensirle handbooks, helps them to create their own application programs,
and is even preparing to arrange exchanges of such programs so as to avoid dupli-
cation of program development in different organizations. Thus a multitude of
interesting applications has been developed in a relatively short time.
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For example, SAPI components are used to control automatic reco,rding of the issuance
of motor fuel for all buses and trucks in the CSAD [Czechoslovak Motor Transport]
plant in Brno, to control voltage and reactive power zn an electric power station
at Lipno and to con~.rol knitting machit~es in the textile industry, conveyor
transport in the SHR [North Bohemian Li,~nite Basin] opencut mines, an information
system for collecting data from the entire Vltava cascade, psychological testing
- of persons, and a pattern generator for the production of integra*_ed circuit masks,
- as well as being used in laboratories and other facilities in health care, the
machine building industry, power production, water conservancy, metallurgy and
transport. On radio relay paths, the SAPI remotely controls and monitors the
operation of unattended stations and the like.
~nn~at the Users Say
Interest is immense, almost unforeseeable, so that the production capacity for SAPI
equ~pment is booked up for the next 2 years. Nonetheless, interested persons from
other enterprises and organizations who are waiting for delivery of the equipment
must not lose time. Engineer Svatopluk Skrivanek, leading specialist of Orgrez
Praha (Organization for Rationalization of Power Plants) would be glad to tell all
of these requesters that the introduction of the system into our power production
industry lasted almost 5 years. First they had to train dozens of workers who
acquainted themselves with the technical characterisitics and capabilities of the
individual components and made thorough preparations in their own organizations;
it was only then that, in cooperation with the Tesla Eltos supply and engineering
_ plant, they proceeded to buy the necessary equipment configurations. It is necessary
to have one's plan prepared in advance and to have the software ready so that the
equipment is not idle for even an hour after its installation--even though it is
extremely cheap and simple, costing on the average about a third as much as imported
equipment.
In the Opencut Mine
The coal extracted from the Chabarovice Opencut in the North Bohemian Lignite Basin
is transported by a long system of conveyor belts and other equipment to the thermal
power station in Trmice and the Antonin Zapotocky Fuel Combine. Optimal and
error-free control of the entire system centered on the KU 300 wheel excavator
requires rapid and precise orientation and communication between the excavator
operator, his crew, the managers and the dispatching service. Now, the SAPI system
processes all necessary information with such a degree of automation that the mining
system can be in operation a full 24 hours a day and its use coefficient in 1980 was
fully 96.2 percent.
The s~t of components monitors the operation of the excavator, the conveyor drive,
seven conveyors, an intermediate coal depot, and a group of conveyor belts in the
distribution locations and records the causes of breakdowns, summarizes data on
tonnage transported, gives hourly, shift and daily reports, monitors extraction by
means of sensors, and operates continuously in an environment which contains coal
dust and in all kinds of weather. According to one of the designers, engineer
Jiri Maly of the Research Institute of Lignite in Mast, the SAPI outputs 295 pieces
of information a day on operations, of which more than 95 percent is acquired
directly or by processing signals from automatic sensors. The system is independent
of human factors and cannot be outwitted.
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In Very High Voltage Distribution Stations
High-quality management of the electrification system requires rapid and precise
provision of information to ~lispatchers at all management levels. Particularly in
case of a line breakdown or an outage it is necessary to have instantly available
sufficient information for rapid analysis of the cause and development of the
malfunction. For all of these purposes, the Czechoslovdk SAPI system with its
JPR 12 R control computers was selected on account of its reliability and previous
successful performance. It is being introduced in 400 kV switching stations and
acts as a sequential recorder of malfunctions, a measuring center and a communica-
tions device. It makes possible the replacement of similar equipment which had to
be imported using foreign exchange. The set of components monitors the operation
of protective equipment for very high voltages, and in case of malfunction it
outputs a picture of its cause and extent with a 10-millisecond time reading, and
also replaces the routine work of crews in monitoring and recording data on electrical
values at the switching station, monitors these data, stores them in computer
memory and sends them out to the superior dispatcher organization. It must operate
just as continuously as the entire electrical system.
In the South Bohemian Nodal Area
Automation of voltage regulation in the nodal areas of our electrical system was
previously impossible because the necessary equipment was unavailable. In
cooperation with the Research Institute of High Voltage Electrical Engineering
in Prague-Bechovice, an SAPI system has been successfully used in the South
Bohemi.an nodal area of Mydlovary-Dasny to control voltage and reactive power
between~components of the electrical system. This has 3mproved the production and
distribution of reactive power and decreased losses in very high voltage lines.
The savings realized amount to as much as 50 MW of power at peak demand, which is
equiva~.ent to a saving of 7,8 million korunas a year. Other difficult-to-calculate
_ savings are realized by speeding up regua.ation procedures and making them more
accurate, decreasing the requirement for regulator components, and eliminate
possible errors and misevaluations by crews in the switching and generator stations.
The entire system has been further improved with the help of the producer and
_ supplier of other components in the system.
Controlling the Vltava Cascade
It is well known that the seven lakes and reservoirs in the Vltava cascade can hold
as much as 1 billion cubic meters of water and that this immense energy source has
an average annual output of 1 million MWh of electrical energy. Controlling this
system from Lipno to Stechovice is extremely demanding, because each intervention
must be carefully considered in advance. This does not involve simply power
production considerations, but also includes navigation, recreation and irrigation
concerns. The Vltava serves as a source of drinking and supply water and affects
supply rates not only in its own drainage area but particularly on the Laba.
Accordingly, optimizing the operation of the entire system is the aim of integrated
management in our power production industry. According to statistical data on the
Vitava drainage area for the past 50 years and operating measurem~nts and calcula-
tions, an increase of 50,000 MWh of electrical energy in an average water year can
be expected from such optimization.
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The first step in modernizing the control and dispatcher system for the Vltava
cascade was to provide the dispatcher center in Stechovice with a set of SAPI
components. Information on the water levels in the lakes and on the condition of
the machinery and its output is sent in the form of telegrams and is received for
processing and forwarding to the dispatchers in the form of operating, emergency
and other memoranda. At any time they have available a picture of the status of
the power stations in the Vltava cascade, including simple balances. All equipment
is produced in Czechoslovakia by Tesla, while some components were developed and
produced by Orgrez, a special-purpose concern organization in Brno,
The next step will be direct control of power stations by the new SAPI R system.
The dispatcher in Stechovice will have the ability to switch individual power
stations in and out of the network and to adjust their output.
- Other Innovations in the System ~
The producer, Tesla Strasnice, and the supplier, Tesla Eltos, already have a rich
fund of experience with operation of the 570 sets which have been produced. Al1
users generously and willingly share their findings and bring pressure for the
development and production of new types of equipment, and for expanding selection
and increasing output. The producer is actually meeting these requests. According
to engineer Zdenek Krejci, director of the Tesla Eltos supply and engineering plant,
series pr�oduction of the new JPR 12 R program control unit has begun. These exceed
by sev~ral times the output of the previous JPR 12 units and considerably expand
the applications capabilities of the SAPI system. Thus there has arisen the new
SAPI R and boards for interfacing with the printers of punched-tape peripherals.
Punched-tape readers, tape punches and alphanumeric displays can be connected into
the system.
This year the configuration will be expanded with a floppy disk unit which will make
it possible to expand the operational capabilities of the entire system. Disk
packages, integrated memory, intelligent data terminals and data-collection terminals
are being prepared for production. All of this is includect in the program for the
Seventh Five-Year Plan.
COPYRIGHT: ROH PRACE, Prague, 1981
II480
CSO: 2400/180 END
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