APPROVED FOR RELEASE: 2009/06/16: CIA-RDP01-00707R000200110014-8
placated the trade unions, strong supporters of Dubcek, by placing the union leader Karl Polacek on the Presidium, but within a year any meaningful voice they had in economic decisions had disappeared.
The Fifth Five Year Plan reflects the political realities set forth by the Husak regime. Growth goals are the most conservative in Eastern Europe, clearly understated to give the economy an air of progress. The 1971 and 1972 plans were fulfilled with a minimum of difficulty and a great deal of publicity. Industrial production remains the top priority; plans call for a 5% to 6% per year growth, fueled by 37% of total investment capital. There appears to be no significant change in the variety of industrial products although the emphasis has shifted towards more chemical and petrochemical production (Figure 13).
Even before the Five Year Plan was announced, consumerism emerged as the dominant economic policy of the Husak regime. The supply of consumer durables has been increased. Czechoslovakia is the only East European nation where automobiles are generally available without a long waiting list. Imports of consumer goods have doubled since 1967—imports from the West have tripled. Minor retail price increases have been enacted, but the regime has been careful to point out that most consumer goods are excluded. The diet, already one of the best in Eastern Europe, is improving; previously scarce fruits and vegetables are more available and domestic procurement of meat is increasing.
Although the regime undoubtedly is watching the Hungarian reform experiment with interest, Husak is not about to introduce any change that could jeopardize growth—still one of the key measuring sticks of political security. For the time being, Husak has turned his back on the longer term economic problems of inefficiency, lack of strong worker-manager incentives, and export difficulties. The 5% to 6% growth rate promised to the populace through 1975 will continue to be achieved by pumping investment into heavy industry, similar to Novotny's policies. Construction projects will continue to be faced with long lead times and chronic cost overruns. Major investment projects, from planning to completion, take an average of 8 years—twice the average time in other developed nations and costs have averaged as much as 22% above plan. Enterprises often resort to overtime work to meet production targets; as a result, labor costs continue to increase and fulfillment figures are distorted. Technology continues to lag behind comparable Western industries. Even their comparative advantage in CEMA, based on the Westernized prewar economy, has evaporated. The U.S.S.R., the leading purchaser of Czech products, within the 1971-1973 period reneged on purchasing some machinery, arguing that the equipment did not meet their needs and in any case more advanced technology was available in the West.
2. Government finance (U/OU)
The function of the financial system is to provide the supplies of cash and credit necessary to carry out the National Economic Plan. The Ministry of Finance
| 1950 | 1955 | 1960 | 1965 | 1967 | 1968 | 1969 | 1970 | 1971 | 1972 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Productive branches: | ||||||||||
| Industry | 45.1 | 34.3 | 40.1 | 42.8 | 40.2 | 36.0 | 38.2 | 37.9 | 37.6 | 35.5 |
| Construction | 2.2 | 2.0 | 3.3 | 2.9 | 3.3 | 3.8 | 3.7 | 3.6 | 3.5 | 3.8 |
| Agriculture and forestry | 8.0 | 14.1 | 16.9 | 14.0 | 11.0 | 12.9 | 11.3 | 10.7 | 10.7 | 15.8 |
| Transportation and telecommunications | 13.5 | 10.5 | 9.4 | 11.3 | 14.8 | 16.3 | 15.0 | 12.4 | 13.8 | 14.7 |
| Trade and procurement | 2.2 | 3.0 | 3.1 | 5.8 | 5.7 | 5.6 | 4.9 | 3.5 | 3.1 | 2.9 |
| Other productive branches | 0.1 | 0 | 0.2 | 0.1 | 0.1 | 0.2 | 1.7 | 1.6 | 1.6 | 1.6 |
| Nonproductive branches: | ||||||||||
| Science and research | 0.4 | 0.8 | 0.8 | 1.2 | 1.3 | 1.5 | 1.7 | 1.3 | 1.2 | 1.2 |
| Municipal services | 1.1 | 1.4 | 5.0 | 2.0 | 2.4 | 2.8 | 2.6 | 2.4 | 2.4 | 3.0 |
| Housing | 16.9 | 24.0 | 15.3 | 14.7 | 13.5 | 13.6 | 14.3 | 17.9 | 17.7 | 17.7 |
| Health and social services | 2.7 | 1.5 | 1.5 | 1.5 | 1.7 | 1.8 | 1.8 | 2.1 | 2.0 | 1.8 |
| Education and culture | 3.4 | 4.0 | 4.6 | 4.2 | 4.3 | 3.9 | 3.9 | 4.0 | 4.3 | 4.7 |
| Administration | 4.6 | 4.3 | 1.7 | 1.6 | 1.6 | 1.8 | 1.8 | 2.4 | 2.0 | 2.2 |
| Total | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 |
21
APPROVED FOR RELEASE: 2009/06/16: CIA-RDP01-00707R000200110014-8
- ↑ Calculated in prices of 1 January 1967.
