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Thursday, June 23, 2022

Pepsi: a great military power

             


          Did you know that Pepsi was once a military power? Pepsi established itself in the USSR, but this deal cost the Soviet Union a cruiser, 17 submarines, a destroyer, and a frigate. This process for Pepsi to market its products took 13 years and could only be completed in 1972!

To better understand this issue it is important to contextualize the geopolitical issues of that time, we are talking about the 60s and 70s, when there was significant tension between the USSR and the USA. This was because during this period the world was going through the Cold War (1947-1991).

While the Soviet Union could market Pepsi, the US obtained the right to buy and sell Stolichnaya vodka. At first, the agreement would not be in exchange for weapons, but rather that each liter of Pepsi would be equivalent to one liter of the Russian drink Stolichnaya. This unusual change occurred because the currency of the Soviet Union (the Russian ruble) had no value outside the country, for which the Pepsi company could not accept the sale of its product in exchange for the soviet currency.

However, this agreement was affected by the Soviet economic crisis of the 1980s. The USSR no longer had enough production of its drink to exchange equivalently with Pepsi. The acceptance of the soft drink had been very great, for which it would be counterproductive for the Soviet government to break the contract, despite the fact that this fact would result in great dissatisfaction on the part of its citizens.




The crisis of the 1980s had such a great impact on the economy of the Soviet Union that it ended up dissolving it in several countries and changing their respective economic models.

This deal resulted in Pepsi becoming the world's sixth-largest naval power in the military arena. In addition to later selling them to Sweden and billing around 300 million dollars with this procedure!


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