The View Eastward Is One of Decline

By , Staff writer of The Christian Science Monitor

PERESTROIKA means problems for the unique Finnish-Soviet commercial relationship. Alone among Western countries, Finland conducts its Soviet trade under a bilateral barter agreement. No money is exchanged. Goods are exchanged and cleared through the central banks in a ``clearing account.'' Every five years, the two sides get together and sign a five year ``frame agreement.''

The system, established after World War II, has served the Finns well, permitting them to win an outsized share of the Soviet market.

Even after the recent downturn in Finnish-Soviet trade, Finland, with less than 5 million people, remains the Soviet Union's second largest Western commercial partner, larger than the United States, Japan, or France, behind only the much more populous West Germany.

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``That's unnatural,'' concedes Keijo Korhonen, an official in the prime minister's office. ``As the Soviet Union opens up, we shouldn't expect to retain such a dominant role.''

Already, mounting Finnish surpluses in the clearing account have forced a renegotiation of the the clearing system payments. The bilateral barter arrangement wasn't totally abandoned.

Deliveries will continue to be decided by central organizations, but Moscow has agreed to turn part of the $2 billion-plus deficit into a loan, and from 1990, to make up any deficit in hard currency payments.

``The agreement should bring the deficits under control,'' predicts Kari Holopainen, the Bank of Finland's department chief on Finnish-Soviet trade. ``It was all done in the spirit of perestroika.''

In the long-term, Soviet liberalization could prove beneficial by opening up a huge potential market to more Western goods, including Finnish ones.

In the short-term, however, Finnish businessmen realize they face increased competition. They believe Mikhail Gorbachev might soon scrap the clearing system.

``For 40 years, we've dealt with the same ministries, often the same people, selling our cable machinery,'' says Noika official Lauri Kivinin. ``Now we've been forced to go there and find new partners to work with.''

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