1948–1953

After the 1948 coup d'état, foreign trade enterprises successfully carried out the government's policy of rapidly redirecting the bulk of the country's foreign trade to communist states in the period from 1948 to 1953.

Many observers contended, however, that the new system had seriously adverse effects on the economy. Isolating domestic producers of export products—primarily manufactured goods—from developments abroad slowed the introduction of new technology, the upgrading of the appearance of products, and the development of sales and service staffs with adequate parts inventories. Isolation hampered the development of export industries and products, reinforcing the autarkic bias of the Soviet model.

1953–1960

After Joseph Stalin's death in 1953, Czechoslovak trade with the Western world gradually revived, although it still was far below prewar levels. More than two-thirds of the foreign trade continued to be with Comecon member states. Because of its relatively advanced industrial position within Comecon, Czechoslovakia initially had a secure market for its machinery and equipment exports. As years passed, however, the Soviet Union absorbed growing portions of Czechoslovakia's export capacity and very soon the country came to depend on the Soviet Union for imports of raw materials as well.

1960–1980

By the 1960s, it became clear that the country's dependence on foreign trade was substantial and that a restructuring of the economy was necessary.

Škoda Works ChS4, built in 1969, is an example of a locomotive exported to the Soviet Union and still used in modern Ukraine.

Aero L-29 Delfín became the standard jet trainer for the air forces of Warsaw Pact nations in the 1960s.

In the 1970s, the government authorized a number of large enterprises to deal directly, or through affiliations with Czechoslovak foreign trade companies, with foreign purchasers of their products. To encourage further export and modernization, the central authorities permitted Czechoslovak firms to retain a regulated portion of export proceeds. Authorities also acknowledged that the economy seriously lagged behind the non-communist industrialized countries in application of new technologies. In response, they increased imports of Western products and processes that incorporated advanced technology.

In the mid-1970s, the terms of trade for Czechoslovakia began to deteriorate rapidly. In 1975 the pricing system used to set values on imports and exports in trade between communist countries was adjusted to make them more current and closer to world prices. The adjustment raised the price of fuels and raw materials (primarily Czechoslovak imports) much more than it did manufactured goods (the country's main export). The same trend manifested itself in trade with Western industrialized countries.

During the late 1970s, the terms of trade continued to worsen; greater and greater quantities of exports were required to purchase the same volume of imports. The combination of worsening terms of trade and the difficulty of expanding exports caused Czechoslovakia's trade imbalance to grow in almost every area. Between 1975 and 1979, the country's excess of imports over exports was nearly US$1.2 billion with the Soviet Union, US$690 million with Eastern Europe, and US$3.3 billion with noncommunist developed countries. These imbalances emerged despite efforts to conserve fuel and raw material use, to slow the volume of other imports, and to increase exports.

During the 1970s, Czechoslovakia, like other countries of Eastern Europe, turned to West European credit sources to obtain financial help for imports as well as longer-term investments in modern technology.

Czechoslovakia did not publish information on these credits. However, one Western estimate placed Czechoslovakia's hard currency debt to the West at the end of 1979 at US$4 billion gross and about US$3.1 billion net. Czechoslovak officials had been much more prudent in building up a foreign currency debt than had several other East European nations, however, and the country's credit standing remained good.

1980–1991

Beginning in 1980, Czechoslovakia was able to achieve a trade surplus with non-communist countries, but only by drastically curtailing imports. When Western banks tightened credit to Eastern Europe in 1982 (largely in reaction to Polish insolvency), Czechoslovakia redoubled its efforts to curb imports and pay off its debt. This cautious attitude continued to prevail even after the creditors' policy eased. The government's stance did have the disadvantage of depriving Czechoslovakia of potentially helpful Western technology.

However, at the end of 1984, Czechoslovakia could boast one of the lowest net hard currency debts per capita (about US$15 per inhabitant) in Eastern Europe; only Bulgaria's debt was lower. With the Soviet Union, by contrast, Czechoslovakia continued to run a substantial deficit.

In the mid-1980s, according to official statistics, Czechoslovak trade activities remained overwhelmingly oriented toward intra-Comecon trade. Within Comecon, in keeping with the plan for regional specialization set forth in the Comprehensive Program of 1971, Czechoslovakia concentrated on production of machine tools and electric railroad locomotives; the traditionally strong Czechoslovak armaments industry also remained important. In 1985, almost 78% of total Czechoslovak foreign trade turnover was with Comecon members. Trade with "developed capitalist countries", by contrast, was listed at just under 16% and developing countries accounted for over 6%.

Most Western analysts believed that official Czechoslovak methods of calculation tended to overstate considerably the value of trade conducted in transferable rubles, i.e., with Comecon partners, and to underestimate the value of hard currency trade with non-communist countries. Nevertheless, the general structure of Czechoslovakia's foreign trade was unmistakable.

Foreign exchange and exchange rate

An important characteristic of the Soviet model that was imposed on Czechoslovakia in 1948 was the attempt to insulate the domestic economy and minimize the impact of world economic trends. The system accomplished this in part by severely restricting foreign currency transactions and confining them to official channels at fixed and favorable exchange rates. Within a few years, the exchange rate had lost its historical basis and no longer bore any direct relationship to purchasing power in other currencies.

Trade partners