Soviet merchant fleet poses threat to Western shipping

The Soviet merchant navy, which has already captured a large part of the West's shipping trade, is an economic and strategic threat to the advanced Western democracies.

This is the main conclusion of an expert survey published by Britain's Aims of Industry Group and the US National Strategy Information Center, based in New York.

The Soviet merchant fleet, the study says, has cut deeply into Western shipping services in the past 25 years. The threat posed to Western shipping interests is twofold: price undercutting by Soviet and East European fleets - in effect pricing Western fleets out of the shipping market; and a growing strategic challenge, as the merchant navies of the Soviet bloc are geared for a possible military role in time of war.

At present there are some 7,500 Soviet merchant ships, making the Soviet fleet the largest in the world. In terms of tonnage it has risen in two decades from 14th to 6th place, ahead of the United States.

The Russians and their allies have obtained their position of growing strength by a program of progressive increases in the tonnage of their merchantmen and by undercutting Western competitors wherever possible.

For example, Soviet merchant ships carrying military equipment to Mozambique have achieved a dominant position on the return journey from East Africa by undercutting Western rates for civil cargoes by as much as 30 percent.

Even more dangerous, the survey suggests, is the slice the Russians have obtained of the Japanese export-carrying market. One-quarter of Japanese exports to Europe now travel in East-bloc ships.

Shipping routes to Central America, Southeast Asia, and West Africa have been at the center of Soviet attention.

At one stage, after a concerted effort, Soviet shipping lines managed to capture 13 percent of general cargo between the US and West European countries.

A major factor in Moscow's drive for a growing share in East-West trade is its desire to earn hard currency. Because the Soviet Union badly wants dollars, sterling, marks, and yen, the Soviets are prepared to quote prices well below the prevailing rate.

Another stimulus for the Russians is the potential of supposed merchant vessels in gathering naval intelligence. In the Baltic and the Sea of Japan some Soviet freighters carry much electronic gear which, Western marine specialists say, can be useful only for intelligence purposes.

Much of the information gathered for the survey flowed from the European Economic Community with headquarters in Brussels. Officials have been compiling statistics for the past four years, and they show an inexorable swing toward the East in the proportion of freight carried worldwide.

The survey proposes that a quota system be applied to the Soviet Union to restrict operations to a particular level. What is needed, the survey says, is joint action by Western governments to impede Soviet and East European inroads into world shipping. But the indications are that if there is any significant increase in the East-bloc's share of world shipping, the matter will become urgent.

London-based shipping interests say that any further expansion of the Soviet fleet could occur only at the expense of the West.

By linking their merchant shipping strategy to their continental railway system, the Russians could eventually be in a position to dominate large sections of Northern Hemisphere trade, especially in East Asia.