o make them aware of needed adjustments
in production.

Standard subsidies per 100 leva, differing by trading area, are granted
on all exports. These subsidies, in effect, modify the official exchange
rate so that trade is actually conducted on a multiple exchange rate
basis. Subsidies from the state budget are also provided for exports,
the returns from which do not cover costs. Special bonuses are offered
to economic trusts and their branches that fulfill or surpass their
export assignments to noncommunist markets. Proceeds from exports are
credited to the economic trusts and not to the foreign trade
organizations.

Relations between economic trusts and foreign trade organizations are
determined in broad outline by government regulations. Specific details,
however, including precise financial arrangements that are the core of
the relationship, must be worked out by the parties to the contract.
This situation provides opportunities for friction that may be harmful
to the export program. Trusts and export associations were therefore
enjoined to undertake negotiations in a cooperative spirit and to avoid
taking advantage of their monopoly position as producers or exporters.
Disputes that threaten to involve financial losses are to be settled by
the Ministry of Foreign Trade and the Ministry of Finance.

Total trade turnover increased more than 3.5 times in the 1960-71 period
to a level of 5 billion leva, including 2.55 billion leva in exports and
2.45 billion leva in imports. The growth of trade was erratic,
particularly in the case of imports. Over the entire 1960-68 period,
however, the average annual growth of exports and imports was almost
identical--13.9 and 13.8 percent, respectively. In the subsequent three
years exports rose almost twice as rapidly as imports, though at a
lower rate than in earlier years. The change in the relative rates of
growth during the 1969-71 period--10.5 percent for exports and 5.6
percent for imports--helped reverse the consistently negative trade
balance of the earlier period and produced trade surpluses in three
consecutive years.

The great bulk of the trade has been carried on with communist
countries, primarily the Soviet Union. The share of these countries in
total trade, however, declined from 85 percent in 1961 to 78 percent in
1970; it had fallen to 73 percent in 1966. Communist countries outside
COMECON, primarily Cuba and the Democratic Republic of Vietnam (North
Vietnam)