Publication details
Czechoslovakian Trade Policy in 1920s
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| Year of publication | 2015 |
| Type | Appeared in Conference without Proceedings |
| MU Faculty or unit | |
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| Description | Czechoslovakia (CS) in 1918 inherited 75% of industry of 52mill. Austria-Hungarian (A-H) market. CS can be considered to be a remarkable example of industrial economy strongly dependent on international trade (had to export most of industrial output and to import many industrial raw materials). For the entire period CS experienced trade surplus, strongest in industrial consumer goods but also in industrial producers good. Nevertheless CS applied high (in some cases prohibitive) tariffs on industrial products supplemented by strict NTBs. Duty by weight tariffs were tripled by government’s deflation policy leading to massive revaluation of CS crown. As our paper shows, the trade policy was decisively influenced by strong nationalism, both political and economic. CS economic policy issue was owned by National Democrats (Czech conservative nationalist party) connected to Živnostenská Banka (ZB; Czech commercial bank dominating Czech nationality capital and industrial circles). While traditional consumer goods export industry was mostly in German hands (3 mill. out of 13 mill. inhabitants of CS were of German nationality), the heavy industry dominated by (Czech) ZB consortium was generally import competing (and dependent on import of raw materials), dependent on domestic market. Until 1925 the CS government was formed by Czechoslovak-national coalition including Czech and Slovak conservative, national, agrarian and socialist parties (all German and Hungarian parties being in opposition). In this period the CS trade policy was instrumental to the foreign policy objectives: to limit the economic ties to Germany, Austria and Hungary and to develop all types of relationship with Triple Entente countries, and political allies Yugoslavia and Romania. This attempt mostly failed – facing assertiveness of west European countries and import substitution industrialization in economies of traditional agricultural exporters. This foreign policy orientation was (without any success) criticized by opposition – proposing trade liberalization (possibly even custom union of A-H successor states). Another line of critique was represented by socialist parties (both Czech and German) stressing the impact of trade protection on consumer (especially the strategy of Czech national import competing industry: forming cartel, exploiting remarkably high domestic prices while dumping exports on foreign markets). Foreign trade therefore represented important class conflict line in CS politics. The turning point was the new government based on coalition of all (Czech, German and Hungarian) industrial and agrarian capital, catholic and nationalist parties since 1926 (opposition was formed by Czech and German socialists). The key was the agreement on supplementing the high industrial protection by significant agricultural tariffs. |
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