East-West Trade as a Source of Tension

Journal article

Wulf, Herbert (1982) East-West Trade as a Source of Tension, Journal of Peace Research 19 (4): 301–322.

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Détente as well as economic cooperation between East and West have been fundamentally challenged. But economic relations became a source of tension between East and West and among NATO-allies long before the Polish government imposed martial law in 1981. It is argued that trade can still provide one of the few channels of interaction at a time of highly dangerous rivalry. At the same time, however, the opposing view on the future direction of East-West trade between the United States and Western Europe has become a source of serious tension within NATO. Considering the different roles the United States and Western European countries play in the military, political, and economic world, it is hardly surprising that East-West trade produces frictions.

In order to shed light on the background of today's all too obvious reversal of the economic (and political) cooperation with the socialist countries of Eastern Europe and to understand the often panicky and confrontational policy statements (especially by the U. S. government), this article (1) tries to categorize different trade policy approaches and options, (2) presents empirical data on the development of trade during the period of détente, (3) examines connotations which are attached to terms like trade dependency and economic vulnerability and (4) analyzes in two case studies the effects and purposes of economic sanctions and the diverging interests regarding the West European-Siberian gas pipeline deal which have surfaced.

Experience with economic warfare, embargoes, sanctions etc. suggests the limits of this type of activity as a foreign policy tool. Even though embargoes and economic sanctions might not have the desired effect in the target country, they will nevertheless probably be imposed to serve ideological goals, since they are considered useful to declare a government's position as regards internal and external publics (voters and allies).

Whether economic trade with the East is seen as an instrument for disciplining the adversary or as a means for improving political relations depends much more on the political and economic stakes involved than on objective possibilities for success.

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