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player ready...In a history-making meeting with President Mikhail Gorbachev, the major industrial nations agreed Wednesday to help bring the Soviet Union into the world economy, but they offered to do it with advice, not money.
Leaders of the Group of Seven nations, including President Bush, spent four hours with Gorbachev hearing his plans for creating a ”mixed economy”
from the ruins of communism and quizzing him about what this meant.
At the end, all sides put the best face on it. Bush, Gorbachev and the other leaders called the meeting ”historic”-the first step toward linking the shattered and isolated Soviet economy to the capitalist world.
”We`ve established our partnership with the Soviet Union on a new and better footing,” said British Prime Minister John Major, the host of the meeting and the G-7 summit that preceded it. ”We pledged our support and encouragement.”
In the long run, this partnership may yield the billions of dollars in Western aid that the Soviets have said they will need to underpin their reforms. But in the short run, Gorbachev went away with little except promises of advice and further regular meetings with the G-7 leaders.
”This has to be a disappointment for him,” said Harvard professor Marshall Goldman, an expert on the Soviet economy. ”He`s been invited to join the frequent flier club but he didn`t get any bonus points. He won`t have anything to declare when he goes through customs back home.”
Goldman noted that the G-7 leaders could have given the Soviet Union most-favored-nation treatment in trade, or abolished strategic restrictions on high-technology exports, but didn`t.
”It`s a disappointment,” a Soviet diplomat agreed. ”If he wanted advice, he could have stayed home. If he wanted money, he didn`t get it.”
On all sides the meeting was seen as a first faltering approach by the Soviet Union to join the industrialized world, met by a wary response from that world.
Gorbachev, badly needing the kind of funds that the G-7 nations command, worked for more than year to get invited to the meeting of the leaders of the United States, Canada, Britain, Germany, France, Italy and Japan.
In a letter sent to the leaders last week, he asked for infusions of consumer goods, a special fund to underwrite the convertibility of the ruble, aid and investment to convert the USSR`s military industries to civilian use and relief from payment of the nation`s foreign debt.
The G-7 leaders let it be known that this was too much too soon, and Gorbachev didn`t even ask for money when he met them.
Instead, he talked for more than an hour, explaining his reforms to Western leaders, most of whom are frankly skeptical that he and his nation understand what a market economy really means.
British sources said a speech by Gorbachev, and a question-and-answer session that followed, answered few of the leaders` questions on his plans for privatization, property rights, free prices, control of the money supply, demonopolization, legal infrastructure and the other nuts and bolts of a market economy.
Some of those who attended the meeting said Gorbachev stuck closely to the ideas outlined in his letter. This was labeled a ”synthesis” between liberal and conservative ideas, and indicated that a ”mixed economy” still would include a large state-owned sector and some collective farming.
In the meeting, they said, Gorbachev remained vague-one reason why the leaders gave him no money. Most of them went away with many questions unanswered and a real doubt as to his commitment to a market economy.
At a news conference later, Major announced a six-point package of Western aid, although even this seemed to be three or four points padded out to give the illusion of scope. They are:
– Associate membership in the International Monetary Fund, giving the Soviets access to IMF expertise, but not to its money.
– Expertise from other international bodies, such as the Organization for Economic Cooperation and Development.
– Access to Western technical aid in key sectors such as energy, conversion of defense industries, food, transport and nuclear safety.
– Programs to encourage Soviet trade, not only with the West, but with former client states in Eastern Europe.
– A promise that the chairman of the G-7-Major this year, German Chancellor Helmut Kohl next year-will hold regular meetings with Gorbachev to review progress toward a market economy.
– G-7 finance and small business ministers will go to Moscow periodically to meet their Soviet counterparts.
Major and Gorbachev put the onus for progress on each other.
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”Our help will not have a lasting effect unless there (is) a clear political will in the Soviet Union,” Major said.
”It is the Soviet Union itself that must mobilize its resources.”
Sources said that, in the meeting, Gorbachev agreed with this point.
But speaking to reporters later, he singled out Western barriers, such as restrictions on export of high technology or trade quotas, as the chief obstacles to Soviet progress.
The Soviet economy has been on ”the margin,” he said in a rambling statement, but this is largely because of Cold War ”roadblocks” set up to isolate his nation.
”If these obstacles are removed,” he said, ”it is possible that major projects can be deployed in energy, transport, food, petro-chemicals and many other areas. These are multi-billion (dollar) projects I am talking about that would be very mutually advantageous.”
Bush, delighted with the agreement on strategic arms announced earlier in the day, insisted that Gorbachev is aiming toward ”markets, capitalism . . . He didn`t come here with a big demand for money.”
Gorbachev`s commitment to market reforms is ”irrevocable,” Bush said.
But Bush opposed Kohl and others who wanted to give Gorbachev more. In a press conference, he hinted that one reason was Cuba.
”It`s very hard to ask the American people to spend money when there`s a dictatorship 80 miles from us that`s being propped up (by the Soviet Union),” he said.