Czechoslovakia-THE EIGHTH FIVE-YEAR PLAN, 1986-90

The Eighth Five-Year Plan called for further "intensification" within the economy. The plan focused on raising the quality and technological level of production, lowering the cost of energy and materials in relation to output, increasing labor productivity, accelerating the pace of innovation at the workplace, improving discipline, and continuing the "structural" shift of the economy from productive activities requiring great consumption of energy to more advanced technologies and capitalintensive industry. National income was to rise 19 percent, or just over 3.5 percent annually on average. Plans called for industrial output to grow 15.8 percent, an average increase of about 3 percent yearly, while personal consumption was to grow by only 11.9 percent. Modest as these targets were, they were higher than the results achieved during the Seventh Five-Year Plan. Only agriculture was to grow at a rate slower than that of the previous plan period; with a total increase of 6.9 percent, it would average just over 1 percent growth annually. Investment, while still low, would increase 10.4 percent during the plan (as compared with 2.5 percent in the 1981-85 period). Special attention was to be given to the machine-building and electronics industries, the chemical and metallurgical industries, construction of nuclear power plants and expansion of the natural gas network, and environment-related projects. The plan called for exports to grow at a higher rate than the national income. The government did not plan any substantial borrowing in hard currency, concentrating instead on paying off its relatively modest (US$2 billion) debt to the West.

The plan called for achievement of the desired growth largely through improved labor productivity; 92 to 95 percent of the growth was to occur in this way. Material costs were to fall by 1.5 percent yearly on average, and specific consumption of fuel was to fall by 2.9 percent. Achievement of both of these goals would require greater savings than had been possible during the 1981-85 plan period.

In the mid-1980s, Czechoslovak leaders acknowledged the persisting weaknesses in the country's economy and its need to modernize more rapidly. Although the government announced no major reforms in conjunction with the Eighth Five-Year Plan, in 1987 an experiment was begun involving about 120 industrial enterprises. These enterprises were to receive only key planning figures from the central authorities; otherwise, they were to have increased autonomy in planning production, seeking profitable forms for their activities, and managing their own finances. The reforms represented a significant step beyond the modest "Set of Measures" of 1981, which had retained strict central controls. Western analysts viewed the experiment as a cautious response to the more ambitious reforms sponsored by General Secretary Mikhail Gorbachev in the Soviet Union.

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For English readers, a valuable source of information is John N. Stevens's Czechoslovakia at the Crossroads, which surveys the period from 1948 to the early 1980s. Much of the statistical data concerning economic policy and performance in this chapter has been drawn from Stevens's survey. Official statistics may be found in the annual Bulletin of the Statni banka Cezechoslovenska. The Foreign Broadcast Information Service's Daily Report: Eastern Europe provides current reporting of statistics and economic developments carried in the Czechoslovak media. Issues of current concern to Czechoslovak economists are presented in the commentaries and essays of Czechoslovak Economic Digest. The United States Congress Joint Economic Committee regularly prints collections of articles on Eastern Europe; as of mid-1987, the most recent collection was the three-volume East European Economies: Slow Growth in the 1980s, published in 1985 and 1986.

The standard sources of economic statistics in the Czech language are the yearly Statisticka rocenka Ceskoslovenske socialisticke republiky and the Historicka statisticka rocenka CSSR. (For further information and complete citations, see Bibliography.)

Data as of August 1987