US-East Europe ties face test on Shultz tour of region

Secretary of State George Shultz's visit to Hungary, Romania, and Yugoslavia next week will test the value to these countries of a strong connection with the United States -- as well as the limits of American influence. Alone among European communist countries, the three countries enjoy most-favored-nation status, which allows their exports to enter the United States at the lowest tariff rates. Each of the three also point to strong ties with the US as proof of their independence from the Soviets -- Hungary and Romania as members of the Warsaw Pact, and Yugoslavia as a ``nonaligned'' country.

But East European diplomats and analysts say the US exerts little pull over their policies, explaining that the benefits of US trade will not produce dramatic political changes. The observers also question whether the US policy of singling out these countries as ``good'' communist nations serves either those countries' interests or the wider US interest in the region.

``Shultz's visit may make life more difficult within the bloc for the Hungarians and Romanians,'' noted one Czech diplomat recently.

Shutz, whose visit begins Sunday, will face the toughest test in Romania. He reportedly will warn the Romanians that they will lose their most-favored-nation status if they do not improve their human rights record. Human rights groups claim the Romanians suppress some Christian faiths.

Romania needs the US trading advantages. As its economic situation has worsened (the country faces a large foreign debt and tough domestic austerity) its trade with the US has soared, rising from $447 million in 1976, the year after it gained the most-favored-nation designation, to a record $1.2 billion last year.

When the US first threatened to withdraw these trading benefits in 1982, Romania moved to head off a crisis. For instance, it ended the requirement that people seeking to emigrate pay for the education they received in Romania in hard currency.

But critics such as Vlad Georgescu, an analyst for Radio Free Europe, charge that Romania remains a fundamentally repressive regime whose foreign-policy ``independence'' offers fewer and fewer advantages for the US. Romania guards its ties to the Soviet Union and has become less useful to the West as an intermediary in conflicts in Asia or in the Middle East.

US influence in Hungary remains even more limited. Squeezed by a heavy foreign debt, the Hungarians have won US trade advantages by following a moderate domestic policy combined with economic reforms. Yet while Hungary may pursue friendly relations with the West, but it makes no pretense about its priorities.

``Good relations with the US cannot affect good relations with the Warsaw Pact,'' a Hungarian diplomat says. ``Our social system and our ties with the Soviet Union will remain the same. That is a fact of life and a point of departure.''

As a nonaligned country, Yugoslavia represents a different case. It views the US as an indispensible counterweight to Soviet influence. Prime Minister Milka Planinc recently visited Washington and then headed to Moscow, demonstrating what she called the balance in her country's foreign policy.

Yugoslav's hard-currency debt problems make trade with the West more important to it than trade with the East. But as Mrs. Planinc's trip showed, even nonaligned Yugoslavia may place its political goals ahead of its economic goals.

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