THE recognition of the government of Soviet Russia by the United States has evoked much discussion as to the effect this action may have on trade between the two countries. While some observers insist that the commercial results of recognition will be of no great consequence, others predict an enormous demand from Russia for all kinds of American goods. It is at least significant that for some months before the Soviet Government was recognized, negotiations were under way in Washington for a substantial grant of credit to Russia by the Reconstruction Finance Corporation to finance purchases in the United States.
The Soviet Government is authoritatively reported as ready to place orders for machinery, steel rails, cotton, and live stock to an amount exceeding $500,000,000 if the necessary credits can be arranged. Whether this would be the beginning of a new and steady demand for American products only time can disclose, but in any event the current discussions give a new interest to certain salient facts concerning Russia's place in world trade and especially to her trade relations with the United States.
In spite of her vast territory, large population and abundant natural resources, Russia is not one of the great commercial nations. In this respect she is considerably outdistanced even by tiny Belgium and the Netherlands (not including the trade of the Dutch colonies). Approximately two-thirds of the foreign trade of the world is in the hands of twelve nations. In this group Russia in 1932 ranked eleventh. Argentina then stood twelfth in the list, and in recent years she and Russia have taken turns in holding last place. No country outside this group of twelve accounts regularly for as much as 2 percent of the total world trade. Russia's share in 1932 amounted to 2.44 percent, a figure to be compared with 13.38 percent for Great Britain and with 10.92 percent for the United States.
While Russia's external commerce is thus relatively unimportant for a large nation, it expanded rapidly in the decade after 1920, as shown in
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