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Argues that the collapse of socialism in the former Soviet Union as well as the collapse of that state resulted from a complex interaction of both internal and external factors. Internally the systemic transformation is significantly impeded by the hysteretic memory of the old system and its functioning. External pressures influence the pace and the scope of this transformation, conditioning Western assistance to the reform process by the demands for rapid convergence to the path of the resolute marketization. The evolution of the internal and external circumstances has brought about the current crisis in the former Soviet Union and raised the critical question of tactical and strategic goals.

The article discusses the commonalities and differences between the Soviet Union and China in the evolution of the philosophy and practical policy vis‐a‐vis joint ventures with the West. The comparative study is set against the background of the ongoing reform in both countries which seeks to integrate Soviet and Chinese economies into the world economic community. It is emphasised that the terms, impact on the overall economic situation, and prospects of joint ventures with the West in the USSR and China, are determined by the scale, scope and consistency of the implemented reforms which, in their turn, are dependent to a certain extent on the results of business co‐operation with Western firms.