I remember back in the 1970's and 1980's when American students who traveled to Russia would bring extra pairs of jeans or record albums with them so that they could trade for cool stuff like Red Army hats and posters of Lenin - and leave their Russian counterparts delighted to be sporting a pair of Levi's and listening to Lynyrd Skynyrd.
Then, in the 1990's, as Russia transitioned to a market economy, they became a barter economy.
As a NY Times article on the resurgence of Russian barterdom noted:
In the mid-1990s, barter transactions in Russia accounted for an astonishing 50 percent of sales for midsize enterprises and 75 percent for large ones.
And we think our businesses are ultra-canny at avoiding taxes...
The barter society is apparently making a comeback, with a Hyundai factory offering SUV's in exchange for, well, what have you got-ski?
Advertisements are beginning to appear in newspapers and online, like one that offered “2,500,000 rubles’ worth of premium underwear for any automobile,” and another promising “lumber in Krasnoyarsk for food or medicine.” A crane manufacturer in Yekaterinburg is paying its debtors with excavators.
"Any" car for 2.5m rubles worth of undies? Any car?
I realize that underwear is not quite as fungible as cash would be, but that's close to $70K worth of undies. For any car?
For a Yugo? For a Chevrolet Aveo?
For $70K you could probably get someone to drive and Aveo over the Bering Strait for you.
Of course, that's $70K worth of undies, not $70K worth of Benjamins. And we don't know if we're talking Victoria's Secret or Fruit of the Loom here, either.
And the crane maker who's paying off debts with excavators.
Imagine the marketing consultant who submitted an invoice for the market research and positioning project, and ended up with a backhoe?
Bartering is nowhere near at the level it was in the day, but Russian economists are closely watching for trends. In November, barter accounted for 3-4 percent of overall sales.
Barter is one way in which the Russians are dealing with illiquidity. No credit? No problem? You got undies, we'll take undies.
Maybe we'll see more of it popping up here. I suspect that in C2C - citizen-to-citizen/consumer-to-consumer there's already a lot of it going on through Craig's List and local swap advertisers.
As for B2B? I can't see this taking off here but there is, of course, nothing new under the sun.
When I worked at Genuity, we had a number of scratch-my-back deals with suppliers. Nortel would agree to do $10M worth of hosting in our data centers, and we'd agree to by $10M worth of Nortel gear. I don't know if any cash ever changed hands, but I do believe that these deals were booked as revenue.
If that wasn't bartering, I don't know what else to call it? (Chicanery? Fraud? Desperation?)