Czechoslovak economy still has not recovered from 1968 invasion

One of the most important long-term effects of the Soviet Union's military intervention in Czechoslovakia in 1968 was that many of the nation's best economists and planners either lost their jobs or resigned.

Thirteen years later this is still an important factor, as the Czechoslovak economy is far from thriving, and low management efficiency in some areas is being admitted.

During the recent Czechoslovak Communist Party congress a number of shortcomings were publicly mentioned. Prime Minister Lubomir Strougal said that Czechoslovakia had not achieved the growth it expected during the last five-year plan.

The government put some of the blame on the high price of raw materials and the world recession.Even so it conceded that production is not high enough, and Czechoslovakia has been making much too wide a range of goods, some of which are not of a good standard.

In some respects Czechoslovakia's basic industrial problems have been similar to those in Britain, which was the first country in Western Europe to achieve a wide industrial base. Czechoslovakia was the first in Eastern Europe. Both nations now have aging plants and machinery.

Because it lost many of its best economic minds after the 1968 invasion, Czechoslovakia has been slow to identify this problem and even slower to do anything about it.

In East European terms the country has been fairly prosperous in the past few years. The Soviet Union was anxious in the early years after its intervention to make sure that physical living standards were at least tolerable and that supplies were adequate.

More and more people were able to afford that second, prized home in the country.But little or nothing has been done about the country's underlying structural problems, and now that the price charged for Soviet oil has gone up considerably, this is beginning to matter more and more.

There have been some attempts to improve management efficiency. They involve giving the management of state enterprises greater flexibility of investment and decision within the national plan, but the reforms are of a very mild nature.

Significantly, they are not being called reforms. That is still a forbiden word in official terminology, since the liberalization of the Dubcek era started with economic reforms, and political reforms followed. That's why there is an inbred suspicion of anything calling itself an economic reform.

At the congress that has just taken place in Prague there was at least more honesty in admitting that severe economic problems exist. In future there is to be more emphasis on productivity, a better use of raw materials, and a higher quality of work.

Unless there are bold measures to increase incentives and financial reward, it seems unlikely there will be any fundamental change. That will be very serious since Czechoslovakia will find its exports, which are still considerable , unwanted in world markets. A lot of people do not work hard here just because they d on't think it pays them to.