Borvendég Zsuzsanna: Fabulous Spy Games. How international trade networks with the West developed after 1945 - A Magyarságkutató Intézet Kiadványai 24. (Budapest, 2021)
‘THE HUNGARIAN MAFIA’ - A Cold War Hungaricum
FABULOUS SPY GAMES Re-exporting was a well-known tool in trade for many decades, but it did not exactly become a particularly typical activity over the years when the Cold War unfolded. Instead, bilateral agreements dominated the arena. From the early 1950s, however, American intelligence became aware of the emerging trend, which was a typical feature of Hungarian foreign trade, and eyed the special deliveries with suspicion. The striking frequency and increasingly significant role of re-exporting prompted the CIA to commission an analysis on the phenomenon, assessing the ramifications of re-exporting and the profit that made the Hungarian trade administration so keen to become involved in transactions as an intermediary.228 They believed they were clearly dealing with a classic example of profit-oriented capitalist business: it was enormously important for Hungary to obtain hard currency, so it developed a mechanism that made sense in a capitalist context in the shadows of the Socialist command economy.229 According to the information gathered by American intelligence, re-exporting was often loss-making, but these transactions were pushed to such an extent that Hungary had a higher proportion of re-exports than any other country in the world. These trade transactions accounted for 12 percent of foreign trade in 1955, while 10 percent of all the foreign trade contracts concluded by Hungary were re-exports over the first three quarters of 1956. For the purposes of comparison, we can find some data in the report: in 1956, re-exporting transactions concluded by the Soviet Union accounted for 7A percent of its foreign trade, while the same figure was 1 percent in the GDR, 5.5 percent in Ceylon and 3.8 percent in the United Kingdom, and just 0.3 percent 228 CIA, FOIA, Economic Intelligence Report - The Role of Re-exports in Hungarian Foreign Trade. June 1959 https://www.cia.gov/library/readingroom/docs/CIA-RDP79R01141A001400100002-2.pdf (Downloaded on: 28 August 2019) 229 It is interesting to ask the question of where American intelligence received the information from to come to this conclusion. In 1958, István Pálos published a study on the foreign trade performance of the country in 1957, included tables with statistical data, and special emphasis seems to have been placed on re-exports. These figures are strikingly similar to the data published by the CIA, although they did not fully coincide with the information held by the Americans. This could quite possibly have been one of the sources of information but it is of course also possible that they gathered information from emigrant foreign traders or through the local operational network. Pálos 1958 82
