Gorbachev proves a hard-nosed trader. Soviet leader demands top quality from his East European partners
Across Eastern Europe, factory managers and government officials say Mikhail Gorbachev's Soviet Union is becoming a more demanding trader. Instead of accepting substandard goods, Mr. Gorbachev insists on top-of-the-line items. And instead of letting his East European allies buy or copy Western technology, Gorbachev wants them to join in a huge socialist effort to match it.Skip to next paragraph
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The Soviet leader's intent is clear. He needs higher-quality goods from his allies to invigorate his economy, and he hopes that greater alliance cooperation will help close the technology gap with the West.
These Soviet demands for higher-quality goods add pressure on already strained East European economies.
Two countries - Hungary, the most market-oriented East-bloc society, and East Germany, the most successful East-bloc economy - have linked their economic strategies to expanded trade with the West.
Countries with few Western contacts, such as Czechoslovakia and Bulgaria, are also upset, but for a different reason. To meet Soviet trade requirements, they fear it will be necessary to alter their economies by relaxing some central controls and permitting a freer market approach in certain areas.
``With his economic strategy,'' says Jacques Rupnik of Paris's Political Science Institute, ``Gorbachev is squeezing the East Europeans.''
Traditionally, the Soviets have subsidized their allies. They have exchanged oil, natural gas, and other raw materials for East European equipment, consumer items, and food. The Soviet raw materials are salable on the world market, but the East European finished goods most often have been unsalable, antiquated, and shoddy.
As the Soviet economy began to stagnate, the Soviets began pushing the East Europeans to produce better products.
``During the 1970s'' notes Paul Marer, an economist at Indiana University, ``Moscow began to complain more persistently that its pattern of trade was disadvantageous.''
Gorbachev is following this lead - but proving much tougher than his predecessors.
``With [former Soviet leader Leonid] Brezhnev, it was all blah, blah, blah,'' says Gerard Wild of the Paris Center of International Studies. ``With Gorbachev, it means `do things.'''
Recent travels throughout Eastern Europe underline the enormous impact of this shift. At the Elektroporcelan Factory in Louny, Czechoslovakia, the managing director said his factory has stopped producing ordinary telephone insulators for the Soviet market.
``The Soviets have become sensibly tougher,'' he remarked. ``They can produce the simple telephone insulators themselves, so they want us to specialize and produce more sophisticated, better-quality insulators.''
Under Gorbachev, a technology development program has emerged as the dominant new element of Soviet policy toward Eastern Europe. Under the auspices of Comecon, the Soviet-bloc trading group, a ``Comprehensive Program for Scientific and Technological Development'' was launched in December 1985. It committed the allies to an ambitious Soviet-led project to develop computers, robots, and and other high-tech products.
In addition, each East European country has agreed to a separate long-term agreement with Moscow to upgrade important technologcal products. Czechoslovakia, for example, is supposed to bring the quality of 15 machine products it exports to the Soviet Union up to Western standards by the year 2000.
Reaction ranges from reluctant acceptance to dismay. Countries such as Czechoslovakia and Bulgaria, which already do most of their trading with the Soviet Union, justify the plan as an opportunity to improve their technology. The Poles, who must cope with a staggering debt and Western sanctions, see no choice but to reorient their investment eastward.
``We once built televisions with you Americans, with RCA,'' one close adviser to Polish leader Wojciech Jaruzelski said last December in Warsaw. Then credits were cut and the television factory lost its American connection. ``Now,'' the adviser says, ``we make televisions with the Soviets.''
For the East Germans and the Hungarians, though, Gorbachev's demands for higher-quality goods could prove disastrous. Their economic successes depend on their Western links. For example: Soviet demands to use more East-bloc computers threaten to destroy the thriving business of Hungary's Novotrade computer company, which sells computer software to IBM and other Western companies.
``If you need high reliability and high accuracy, socialist-made computers won't do,'' says Gabor Renyi, Novotrade's director. ``We sell Commodore 64 models.''
Gorbachev, of course, is not all bad news for the Hungarians. A top-ranking Central Committee member in Budapest said the new Soviet leader's acceptance of economic reforms will make it easier for the Hungarians to continue with their own market experiments.
In particular, the Hungarians are pushing for new mechanisms to increase Comecon's efficiency. The Hungarians have long urged Comecon to adopt a more realistic price system in place of its present emphasis on barter trade.
But such market ideas scare other East European communists, notably the orthodox Czechoslovaks and East Germans. Fearing economic reforms will undermine their political control, top-ranking officials in both countries have warned against introducing market mechanisms similar to those launched by Gorbachev in the Soviet Union.
Vasil Bilak, Czechoslovakia's No. 2 leader, recently equated supporters of Gorbachev's ideas with those of the reforms of the 1968 Prague Spring, which ended with the Soviet occupation of Czechoslovakia. In Mr. Bilak's view, any Czechoslovaks who show undue enthusiastic about ``the new policy'' in Moscow are forgetting the 1968 ``lesson.''
Such remarks reveal growing tension between Gorbachev and his allies, Western experts say.
``By tightening the economic screws, Gorbachev also is tightening the political screws,'' concludes Jacques Rupnik. ``He wants an alliance tied closer to the Soviet Union.''