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This is the first study to analyze the problems of Eastern Europe’s convertible currency external debt situation and its impact on the financing of East-West trade in the late 1980s and early 1990s. Dr. Zloch-Christy addresses four main issues. First, she examines the recent reforms in Eastern Europe’s economic political relations. Secondly, she assesses whether convertible currency debt problems are an inherent part of the economic development of Eastern Europe and if the problems are regionwide, and she discusses the strategies adopted for dealing with them. The author then explores the extent to which the problems arising from indebtedness have affected the financing of East-West trade. Commercial and production compensation, various forms of credit and funding from international financial institutions are the main financial arrangements discussed. Finally, Dr. Zloch-Christy assesses medium and long-term debt prospects both for Eastern Europe as a whole and for each country within the CMEA.
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