ABSTRACT
Czechoslovakia was never heavily in debt, and also during the 1980s remained a desirable business partner for Western banks. The relatively liberal political practice that has accompanied the Hungarian economic reform had always inclined Western lenders to assist Hungary in critical situations. Since the Western banks showed growing willingness to extend credits to the CMEA countries and as the strategy developed in Poland appeared very plausible, other Eastern countries soon followed suit, very quickly extending their Western imports, financing them with borrowings from the West. Yugoslavia's debt crisis set in about the middle of 1982, when Privredna Banka Zagreb and later Investiciona Banka Titograd delayed payments. Since adequate surpluses could be earned until 1985 in trade with the developing countries, it was only during the actual phase of the CMEA indebtedness crisis of 1982/83 that Bulgaria was constrained to curb imports from the West. The indebtedness of the Soviet Union has always been held to be moderate.
