Ct,),
MICRO ONLY
n Financing Hard Currency"Trfttlo Deficit.*
Key Judgements
Tho USSRard currencyof
J
billion5 and is expected toeficit on the
order cZillion toillion thisMoscow had
no problem covering5 deficit, andan excellent
credit risk, it is encounteringdoing so
Financing5 Deficit:
addition to its normal heavy uje of government-backed credits, the USSR was forced to3 billion from Western commercial banks5 and
to sell asI billion in gold. In addition the USSR received at0 million in loans directly from Middle Eastern OPEC countries.
medium- and long-term debt is estimated to have risen5 billion and total indebtedness to over
illion.
Outlook
The USSR will be ablo to make continued heavy use of government-backed creditsowever, last year's heavy Eurocurrency borrowing will limit Moscow's ability to secure similar financing Moscow will probably increase its gold sales, but its earnings from these sales will be limited by lower, probably declining gold prices.
Moscow has taken severalo minimize the amount of commercial borrowing requiredhese steps have included delays in payments due soma Western suppliers and jrequosts to others for financing uf orders originally contracted forash basis.
the Soviets have yet toillingness tc significantly cut back on orders for Western equipment
Moscow will probably bo ablu tooficit of as much as S6 billion without having to request debt rescheduling, but in
so doing will almost certainly exhaust its remaining ability to tap Western commercial banks for untied financial credits. Legacy
USSR undoubtedly is countingastly improved trade picture forG and beyond. In fact, Moscow would probably be forced to take severe measures to counter any threatubstantial trade deficit
This could occur, for example, if the USSR .ins another poor harvest this year.
the Sovietsarge deficit againho need for debt rescheduling wouldistant possibility. With access to Eurodollar funds severely limited, Moscow might also try and tap funds from the Middle East more haavily.
Hard Currency Trade
The USSRard currency trade deficitf billion5 and is expected toard currency
deficit ofillion toillion this year. Much of5 deficit was caused by higher Imports of Wo?ternillion) and grainsillion)ime whon recession in theept Soviet export growthegligible level. Prospects6 are more favorable. Recovery in the West should allow tho USSR to increase export earningsoillion in the firstut imports, particularly of Western equipment and grain, arc also expected to rise. Soviet importsn value toillion in the first quarter, leaving Moscow2 billion hard currency trade deficit for this period. The Role of Government-Backed Credits
The USSR relics heavily on government-backed, long-term, low-interest credits toajor share of its capital goods imports from the n'est.l/ The Soviets undoubtedly regard such creditselatively low cost means ofthe pace of acquiring Western equipment and technology.
1. With the exception of West Germany, government backed export credits include interest rate subsidies as well as guarantees. Although the West German government does not subsidise the interest rates, government guarantees allow West Gorman banks access to mora preferential market rates and providesignificant expansion of tho volume of credit theso banks are willing to extend to the USSR. In the case of tho US, less5 US equipment exports to the USSR was financed by Eximbank credits arra-.god for in
The USSR not only Is able to stretch repaymentsong period, but also to make these payments in Western currencies which have been inflated even further. The USSR ulso has used govornmcnt-backed credits toajor share of its purchases of large-diameter pipe from the West. , an0 million in pipe imported cs part of various Soviet gas-for-pipe deals has been financed in this manner.
esult of its increased reliance on medium- and long-term creditsprivate as well ashe USSR's medium- and long-term debt has risen in recent years from an6 billion at the end3 to an5 billion at the end of last year (see/ Because of the expended repayment periods involved, including grace periods onleast some credits, Soviet debt service remains relatively
Most Western countries feel that long-terra creditsecessary evil associated with doing business with the USSR and aro quite willing to extend large lines of credit in hopes of securing substantial Soviet contracts. Sincehe USSR has receivedillion in credit lines frcm Western Europe, Japan, and Canada (see
IT. Including the commercial supplier's credits which take the form of Soviet promissory note financing.
-5-
Thes expected to continue receiving largecredits toajor chare of its capital goods and pipe imports. The Soviets have yet toajor share of the credit lines extended earlier by France, the UK, and Canada. Japan and West Germany are expected to continue to finance major dealsasc-by-case basis. Italy is tho major exception. Although tho Italians feel that low-interest credits ore crucial to obtaining badly needed Soviet business, domestic economic difficulties severely limit the amount of crodits the Italian government can extend. For this reason, the Italian government in6oviot request0 million in credits to cover the purchase of Italian equipment.
Medium- and long-term credits drawn to finance equipment and pipe imports coveredortion of the5 hard currency trade deficit. Once allowances are made for the repayment oi principal and interest on past debt, onlyillion was available to offset3 billion deficit. The USSR was forced to finance the3 billion from other sources. Moscow sold gold and relied heavily on the Eurodollar market in doing so (seeurodollar Dorrowing
Fortunately the USSR5et liability ofillionis its position with Western
-6-
Toblo 1
USSR: Financing5 Deficit
Millions US S
Merchandise trado 5
Medium- and long-term credits not of
principal and interest
Other invisibles and hard currency
.
BALANCE
Of which:
Eurocurrency
Reduction in Eurocurrency
Increase in Eurocurrency liabilities,
Errors6
n Officia'. Soviet Foreign Trado StcListics.
2. Includes revenues from arms sales, hard currencyunder clearing agreements, and net receipts from tourism and transportation. 3* Includes loans from the Middle East.
commercialsee tho chart). While Moscow was believed to have made use of the Eurocurrency market to help finance3 grainortion of this amount was repaid and assets rebuilt during the following year. Soviet assets with uk banks, for example, roso0 million
he USSR borrowed3 billion from Western commercial banks while at tho same time reducing its holdings1 million. At year's end, total Soviet liabilities stood6 billion and net-liabilitiesout Soviet assets held by Wastern banks) / Much of this borrowing was doneirect bank-to-bnnk bar.is whereby the USSR obtained time deposits and other short- ana .tedium-term aredits simultaneouslyreat number ofks. Borrowing was heaviest during theillion) andillion) quarters of the year. Tho USSRdrew heavily on its deposits in Western banks during January-Junenly to rebuild them during the third and fourth quarters.
T. Bank of International Settlements data which includes reporting from the coinmorcial banks of Belgium-Luxembourg, France, West Germany, Italy, the Netherlands, Sweden, the United Kingdom, Canada, and the United States. The USSR wasot debtoris Swiss banks which do not report their positions with the USSR to tho BIS. 4. According to US Treasury and Federal Reserve statistics, US-based banks and their major foreign branchesn claims against the USSR at tho end f these claims were held by the foreign branches.
END OFd4
1. Banks of Belgium-Luxembourg, France, West Germany, Italy, Netherlands, Sweden, the United Kingdom, Canada, and the US since the second quarter4 and offshore branches of US banks beginning in tho fourth quarter of Tho USSR is also believed toignificant net debtor with Swiss banks.
Syndicated medium- and long-term loano accounted for0 million of total Soviet Eurodollar borrowing In all cases, tho USSR was. able to obtain relatively favorable terms and management fees (see Lead Western banks had little trouble in arranging the syndicicion.-.
Well0 million of Soviet Eurodollar borrowing was indirect, resulting from the discounting of private supplier's credits by Westernith their banks. In such instances, tho USSR paid for Westerneries of negotiable notes which were guaranteed by tht Soviet Bank for Foreign Trade and whichixed interest rate% In most, cases the notes maturederiod of five years or more, tn& were discountedon-recourse basis at 8ft ?he value of such transactions rose significantly accounting0 millionf total Soviet Eurocurrency borrowing. The total medium- and long-term ccmponent of5 Eurodollar borrowing was thus probably in the range3 billion8 billion or more.5/
V, US bonus discounting such notes often required ausually on tho order, over tho prime US interest rate.
his amount is included In Soviet medium- and long-term indebtedness as discussed on the previous page and shown in
-9-
Gold Sales
Tho Soviots were frustrated in their efforts to sell gold5 by market developmentssuch as the5 IMF announcement of gold saleswhich helped to push the gold prico down5 per ounce to0 per ounce. Nonetheless, heavy Soviet sales were resumed in June when Soviet planners became aware of tho need to import massive amounts of Western grain and recognized the persistency of the recession in the West. During June-December, the USSR0 fillion worth of gold in Switzerland, bringing5 sales on nhis market4 million (secn addition to cellin; gold on the Swiss market,USSR has also ^ctaowledc-ztc direct nalos to Middle Eastern buyers, notably &urait andrtra. la. Someons, worth an0are reportedly sold last summer. Othnr Sources ol.'jrrccy Revenue
SSR also ijcnofitcd from net revenues from its transportation and tourism and from direct lending from OPLC nations. An expanding merchant marine allowed the USSR toan1 million in levcnucs last year, and5 earnings on tourism arc estimated0 million.
ndicnte that the USSR received ait0 million in direct loans from the Middle East, principally from Iran and Kuwait. Arms sales to the less developed world, primarily tc Iraq andrc estimated to have earned the0 millicn or more.
r
met with similar requests.
Soviets are also insisting that new contracts
signed6 not entail cash disbursements (including downpaymcnLs and progress payments) before the begi'.ning
In negotiations with
of auto
equipment, Soviet officials claimed that no payments could be made this year and insisted on long-
financing.
to accept Soviet
notes as paymentf the contract with the initial Soviet payment ofo be deferred until Tho USSR is also known to be
attempting toay to circumvent French creditv&ichownpaymcnt before credit can bo approved for the remaining amount.
Moscow has also delayed the placement of some orders, including contracts for computer systems, testing equipment, and gas turbines for power plants. Some previously committed hard currency allocations for equipment purchases wore revoked because of th need to buy Western grain. Although such paring seems to be concentrated in non-priority areas or areas where Soviet-produced equipment can bo substituted, the USSR has also defcrrod somo projects in acknowledged high-priority sectors such as the oil industry.
. diamoter pipe imports. The USSR also is expected to make heavierof promissory note financingossibly to the detriment of concomitant attempts to obtain pure financial credits on tho Eurocurrency market. Total medium- and long-term credits associated with equipment and pipe imports will thus7 billion. Allowing for principal and interest repayments on past medium- and long-term credit drawings, new drawings will net the USSR4 billion which can be applied against6 trcdo deficit (see
Asther invisibles and earnings from arms sales shoccld net the0 million, leaving rocrghlyobillion to bo covered by gold sales ancS additional financial credits from the West.th of these areas tho USSR is facing constraints. Eurocurrency Borrowing
Although still an excellent credit risk, heavy borrowing5 has placed the USSRight situation for borrowing this year. By tho endany major European and US banks had reached their self-imposed credit limits which govern the shareank's assets which can bo loanediven borrower. Moreover, bankers able to continue to lend were beginning to insist on higher interest rn es and fees for new
Table 2
USSR: Financing6 Deficit
US S
Merchandise0
Medium- and Long-term credits net of
principal and interest
Other invisibles and hard currency
.
BALANCE0
of which:
Seduction into 0
Errors and
1. Estimated
2". Includes estimated revenues from arms salos, hard currency expenditures under cloaring agreements, and net receipts from tourism and transportation.
3. Will possibly include borrowing from tho Middle East and where possible, additional bank-to-bank borrowing on the Eurocurrency market.
Soviet loans. The extent of Soviet problemsby Moscow's recent effort to securemillion consortium loan to holp finance
In late April, the USSR approached several West European and IS banks0 million general financial credit for balance of payment financing. Only one US bank, which had never before led aon the USSR's behalf, agreed to syndicateoan at this time. The terms of the loan called for an interesteadbove LIBORanagement fee of Tho funds wore to be drawn down quickly and were to be repaid over five years with
period
i three-year grace/on principal repayments.
Che lead bank has found syndication of the loan exceedingly difficult. yndicationomplete and final details should be wrapped up soon, it probably will not be on the terns the US bank would have liked. Many Western banks, including tho big three Swiss banks, have reached their self-imposed credit limitsis the USSR and havo rcfusod to participate in the syndication. Banks ablo to lend cited the relatively low return from tho spread and management fees as unrealistic in view of heavy recent Soviet borrowing. These latter banks profor the high
returns obtainable from rediscounting Sovietnotes. Docauao of problems cited above, it seems unlikely that the USSR could raise more thanillion in syndicated financial credits this year and will probably have to pay higher rates in doing Additional credits would have to be raisedank-to-bank basis. Gold Sales
Hith Eurocurrency borrowing apparently limitedhe USSR seems forced to market large amounts of gold this year. -Unlike past years when Soviet decisions to sell cold depended mainiy on marketbalance of payments requirements now appear to be the predominant factor. After selling small amounts in January* and February, in March the Soviets reportedly resumed .heavy sales on the Swisc market. Moscow con also bo expected to market gold outnido of traditional markets. Press reportsncluded an example whereby the USSR used gold to7 million progress paymentwisc firm.
Tho Soviec nnod to maximize earnings from gold comesime when tho market is alreadyubstantial increase in the rato of Soviet gold sales would likely drive prices down later this year. Gold prices have alrandy slumped because of weak demand and tho pronoectc for an increase in supply. Industrial
consumption of gold, although beginning to recover, is runningelow its peak level Tho speculative demand for gold, which accounted for slightly over half of Free World demand last year, is down sharply becauseoderation inecline in currency unrest, and an upturn in real intorcst rates. On tho supply side. South Africatho world's major producerhopes to increase production this year. In addition, the IMF, which began auctioning monetary gold last week, will increase the supply of gold to Frco World markets byn second6 coraapred with tho samo period lost year.
If the Soviet L'-Lci incroasos salesonthly rateoons ^compared with last year's pace of slightly overons, tho supply of gold to tho Froo World market wouiri be increased by an additionaln the second half of this year. Assuming the supply of funds to tho speculative market does not increase from tho currant levol,ove could dopreos prices byn ounco. Soviet earnings from the sals of this amount would thus vary botween 0 million andillion. The price impact of tho Soviet action probably would bo somewhat offset by prico-inducod incroasos in speculative and industrial purchasos. Thore is also the possibility of additional gold purchases by central banks to support the market pric
;WC3Ef
Borrowing Directly from tho Middle East
Proasuro on tho USSR to soil gold and/or to pay highor interest ratoo to attract additionalcredits will be lessened to tho extent that Moscow is able to borrow directly from tho Middlo East. Knowledge on such lending is limited. Iran is known to have placod0 million directly with tho Soviet Bank for Foreign Trade last year and mayource for additional Soviet borrowing The Iraqis, for their part, regularly keep0 million in tirao deposits with the Soviet Bank for'Foreign Trade.
Increased Soviet interest is perhaps bestthe6 visita Soviet financialKuwait. The Soviets 'were interested intime deposits for project financing bothUSSR andcountrios and Kuwaiti par-
ticipationoint Soviet-Arab bank. The Kuwaiti response to these roquosts is unknown] however, they will probably stop up their lending activity at least somewhat.
Financing Sconnrlos
eficit in excess ofillion,it thus appears that the USSR will bo able to moot its financial obligations6 without having to request debtfrom Wostorn governments. This cntlmato is based on tho assumptions that tho USSR will be able to:
These steps could Include diverting easily marketable exports from soft currency trading partners to Wostorn aarkctsj requesting delays in deliveries of goods not covered by medium- and long-torn credits; or, if necessary, cancelling contracts outright.
On the financing sido, the USSR could be forced to expand gold sales ovan furthor regardless ofkot conditions. Moscow could olso be oxpected to insist that imports financed by government-backed crodits bo lOOi financed. Debt rescheduling with commercial banks isossibility, although stops In this direction would have an adverse impact on the credit rati no. the USSR has continually tried to maintain.
t
APPENDIX ,1
USSR: Estimated Drawings and Scheduled Repayments on Medium- and Long-term Credits
Percent
n Scheduled' repayments of principal and interestercent of" hard currency exports.
Including drawings on three-year Commodity Credit Corporation credits. -
0 million in known consortium loans drawn down5 and an0 million in consortium loan drawdowns
Projected.
ML
OSS*: JUJor Coventront-Backed Credit Agreement* withest
inc siredit?7
of Contract
ate(a)
of Defcrrent* Crrdtt tyral or'Vary ?criod
CLfor general purpose ciadlt lino, PA tor project aaaociat?d. 2. Kllllons of current OS dollar*.
). tatirated.
APPENDIX 3
USSR: publicized Connortium Eurocurrency Crodits
55
55/
Intorcst Rate
rs
N.A.
3rs
Longth of Grace Credit (yrs) Periods
ver
%
verover LIBOR'
ver
in millions ot US dollars. 2a* London interbank offered rata. 3. Syndication not yet complotod.
East European Hard Currency_Debt Sonr3
Key4 billion trade deficit incurred5 boosted Eastern Europe's hard currency debtillion. Anotherillion deficit is expected this year. Poland,
by for the heaviest East European borrower, could rackrado gap surpassing thoillion incurred lasc year. The East Europeans had little difficulty in obtaining the necessary financingut Poland is now encountering some difficulty in doing so.
Financing5 Deficit
In addition to their normal heavy use of government backed credits, the East Europeans were forced to
7 billion from Western commercial banks.
major creditors were the United Kingdom, West Germany, and France.
Outlook6
of the East Europeans except Poland appear willing to keep tho growth of imports wellhat of exports. Poland continues to place largo orders for Western technology and equipment and
is committed zo sizeable grain purchases.
the East Europeans will bo able toeavily on governmont-backed credits, they will
require another large infusion of Western bankcredits.
. Poland will continues to be the largest Eurocurrency borrower but, because of banker concern ovor its largo debt, probably will be forced to accept higher interest rates and/or management fees to get the financing it requires.
SECRET
Dincuosion
*
The Debt
Eastern Europe's net hard currency indebtednessillion atp6 billion at0 (sec* Poland led the pock9 billion, followed by East Germany and Romania, which stacked up dobts8 billion0 billion, respectively. In recent yoars, Polandeager for advanced Western technology and equipmenthas permitted the fastest growth in indebtedness. Romania, on the other hand, reacted to the escalation of its debt ins by cutting back on the growth of new borrowing ins.
Except for Romania, East European imports from the' developed West grew considerably faster than exports (see Host ofillion cumulative trade deficit was incurred. Export growth began to fall in tho second half4 duo to lower Western demand and EEC restrictions on meat and live animal purchases. The East Europeans, however, underestimated the depth of the Western recession and did not begin to cut back on imports until tnc spring Thus,ast European deficits on
* The estimates of'"East European hard currency indebtedness used in thin paper represent net liabilities with tho developed West adjusted for hard currency assets and liabilities with other areas, including CEMA.
IP ?
IjHf
aH.llS??
Plilpljll!
I i
i!
g' MS? pi
fill ;i
trade with the developed West totaled an estimatedillion, topping the previous record4 billion incurredhereotablo slowdown in tho growth of tho doficlt in tho second halfowovor..
LengthiStructure Improved
0ll the East European countries except Poland realized an improvement in their debt structure as long-term liabilities rose much faster than medium- and short-term. esult, the share of long-term in total not liabilities rose fromercont toercent. Thus, although there was not much movement toward longer maturities for individual credits, average maturities lengthened.
Romania has met with the most success in spreading out its dobt and now has the most fa**orabla debt structure of all tho East European countries. Long-term indebtedness stood atercent of the total at5 as conpared withercent at Poland, on the other hand, has hod to dip heavily into short- and medium-term financing in order to holp offset unexpectedly large trade deficits and meet sharply Increased debt servicing obligations. esult, long-term
S
liabilitiesalthough more than quadruplingdropped from two-thirds of total net liabilities0 to ono-third Poland still, however, has more of its debt in long-term than do Czechoslovakia or East Germany.
SECRET
Sources of Financing
Eurocurrency financing and credits guaranteed by Western governments provide the major sources of hard currency financing for Eastern Europe. Other sources include direct Middle East placements and CEMA banks.*
Net liabilities on the Eurocurrency market have grown much more rapidly than on government-guaranteed credits. This trend mainly reflects the major change in the composition of Poland's debt. For the areahole, known net liabilities on Eurocurrency markets, which account for about one-half of total debt, came to an0 billion at5 (see Poland is the largest user of Eurocurrency financing, followed by East Germany, Hungary, and Bulgaria. Oltraconservative Czechoslovakia has gone hardly at all into Eurocurrency financing. Bucharest, surprisingly, has also not borrowed much in Eurocurrency markets.
Part of the Eurocurrency financing consists of medium- and long-term consortium loans. Of the total increase in Eurocurrency borrowing3 billionor about one-thirdconsisted of publicized Eurocurrency syndicated loans. Poland0 million; East0 million;0 million; and6 million. In addition, Czechoslovakia received its first consortiumillion for deliveries of grain.
* Largeowever, remain in out knowledge about the sources of financing, especially in tho cases of Czechoslovakia and Romania.
TABLE 3
External Positions of Western Commercial Banks with Eastern Europe-"
Million PS S
December4
5
December
Bulgaria
Czechoslovakia
East Germany
Hungary
Poland
Romania
Total
Assets
Assets
283
914
Assets
288
867
Liabilities0
Sources Bank of International Settlements Data.
1. Banks of Belgium-Luxembourg, France, West Germany, Italy, the Netherlands, Sweden, and the United Kingdom. Switzerland Canada, Japan, and the United States do not report separately on their position with Eastern Europe. The East Europeans are believed, however, to be net debtors.
SECRET
Major Creditors
Byho United Kingdom was the single largest creditor, accounting for'.just under one-fourth of total East European indebtedness. About three-quarters of tho debt to the United Kingdom consisted of net liabilities on tho London Eurocurrency market. West Germany came next with aboutercent of total debt and led in government-guaranteed credits outstanding with about one-third of the total. East Germany accounted for almost one-third of net East European liabilities to West Germany. France followed with aboutercent of the debt.
Other Wost European countries accounted forcrcont of the East European debt; Japan, the United States and Canada forercent; and the Middle East, CEMA banks, and the IMF (Romania only) for theercent. Notable shifts by creditors0 haveecline in the West Gormanise in the Uk and French shares; and the appearance of the Middle East Countries and CEMA banks as significant creditors.
Kuwait and Iran have become active lenders to Eastern Europe in tho past yearalf. Known credits from the two countries total nearlyillion. Iran0 million to0 million to Bulgaria, and
SEMET
reportedly0 million to Poland in loans, and Kuwait0 million in Romania and Hungarian notes and bonds. In addition, there are some short-term Middle East deposits placed in Eastern Europe.
Most of tho CEMA bonk funds so far have come from IBECj with the greater part probably going to Czechoslovakia, East Germany, and Romania. Romania, the only East European country thatember of tho IMF,5 million against two IMF tranchos and an IMF standby credit.
Outlook
Eastern Europe will again have to -orrow heavily Even with some recovery in exports, the deficit on trada with the developed Host could0 billion, not nuch lower than4 billion incurred last year. All but Poland are expected to keap the growth of imports well below that of exporto. Poland is committed to large orders of machinery and equipment and of grain. Romaniaconcerned about its high debt burdenis expoctod to try especially hard to reduce the trade gap.
Eastern Europe's net borrowing to cover the5 billion curront account doficit would bring the total debt upillion by Poland's debt could well hitillion. In addition, the East Europeans will have to borrow to cover their repayments obligations. Thus, total financing required may approachillion.
The East Europeans, especially Poland, will be able to draw heavily on Western government-backed credits to finance the major share of thoir equipment imports from Western Europe and Japan. And they have received some credits for grain purchases. In addition, Poland will receive this0 million in West German credits and payments to the Polish pension fund and Romania has5 million under two IMF standby arrangements.
Even so, the East Europeans will once more be forced to borrow heavily on tho Eurocurrency market perhaps as much as7 billion taken last year. Poland will continue to be the largest Eurocurrency borrowerperhaps requiring close toillionfollowed by East Germany, Hungary, and Bulgaria. Part of the borrowing will again consist of syndicated loans, of which the East Europeans alroady have0 million in this type of loan and are seeking0 million.
Eastorn Europe's soaring hard currency debt is causing
Western bankers to reexamine their lending policy, especially
in the case of Poland. esult the East Europeans probably
will have to pay higher interest rates and/or fees. Given
the largo supply of funds expected in the money markets,
however, they should be able to borrow what they need. Eve.i
Poland is still preferred over many LDC borrowers and should
bo able to meet financing requirements, though probably
igher cost.
A heavy borroweroland generally must pay
*
the highest ratesatercent above London Interbank Offered Bateof any East European country in obtaining commercial loans. Poland seems to be encountering difficulties in arranging for credits on the terms it desires. Earlier this year, for example, Poland's request
illion credit to finance grain purchases was turned down by US hanks because of the low interest rate Poland offered to pay. Alternatively, Warsawyndication offered by US banks to help cover the purchaseolor television plant because of the high interest rate demanded by the banking consortium. Financial necessity will ultimately force Warsaw to accept higher interest rates and/or more costly management fees in6 Eurocurrency borrowing.
Bankers for the most part appear willing to meet tho financial needs of Hungary, Bulgaria, and En, at Germany on reasonably favorable terms. Romania and Czechoslovakia are not expected to tap the Eurocurrency market extensively this year. eavy overall debt burden, Romania could encounter some difficulties if it tries to borrow large amounts on the Euromarket.
Original document.
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