US, Soviets make slow progress on trade

The United States and the Soviet Union are making slow progress in improving trade relations. Commerce Secretary Malcolm Baldrige said after two days of meetings here, including one session with Soviet leader Mikhail Gorbachev, ``I'm sure we'll see an increase in trade. . . . I don't think that we should expect a major increase.''

But he did announce a number of measures that he predicted would provide for greater ``trust'' in US-Soviet trade and set the stage for ``some real continuity in our [trade] relations.''

The measures, agreed to by both countries, are hardly bold. For example, Soviet Foreign Trade Minister Nikolai Patolichev has agreed to write a letter to Soviet foreign-trade organizations, stressing the need to do business with US companies and to give them equal treatment with other foreign competitors. The Reagan administration will, in turn, take such steps as sponsoring legislation to repeal a 34-year-old ban on the import of certain Soviet furs into the US.

The Soviet Union is pressing the United States for expanded trade -- but with virtually no strings attached. That was the Kremlin's central message for the 25-member group headed by Baldrige, the highest-level US trade delegation to come here in six years.

The Soviets have long insisted that trade should be insulated from political disagreements dividing the two countries. In fact, trade figures have served as a barometer of the political weather in recent years.

They currently show a major imbalance, with the US exporting $3.28 billion worth of goods to the USSR, yet importing only $600 million worth of Soviet goods. The bulk of US exports ($2.8 billion) is agricultural products, mostly grain. The US has slipped from the Soviet Union's second-largest trading partner to its seventh.

The visit of Baldrige, as the co-chairman of a meeting of the Joint Commercial Commission here, was an attempt to reverse the trend. The meeting -- the commission's first since 1978 -- was also taken as another bellwether of gradually improving relations between Washington and Moscow.

Baldrige said his visit was ``part of President Reagan's effort to seek a more constructive working relationship with the Soviet Union.''

Baldrige hand-delivered a letter to Mr. Gorbachev from President Reagan. According to Tass, the Soviet news agency, it expressed ``in general terms the wish for expanding trade between the USA and the USSR.''

Baldrige would not be drawn into specifics of the letter or his conversation with Gorbachev.

Gorbachev, according to Tass, said the ``unsatisfactory state of Soviet-US trade and economic ties'' was ``a result of the US administration's policy of discrimination against the Soviet Union, attempts at interfering in its internal affairs, and using commerce as a means of political pressure.''

The trip generated controversy from the start, with US Secretary of Defense Caspar Weinberger petitioning Reagan -- unsuccessfully, it turned out -- to call it off. The Pentagon warned that it would send the wrong message to the Kremlin in the aftermath of the shooting of a US Army major by a Soviet sentry in East Germany.

Moreover, the Pentagon insists that Moscow is intensively shopping for Western technology that can be diverted to military use -- and that easing US trade restrictions could save the Soviets millions in research funds.

But the US delegation was at pains to stress that only ``nonstrategic'' trade was discussed.

The Soviets also want what is known as ``contract sanctity'' -- a guarantee that contracts will not be broken by trade embargoes or punitive sanctions, as happened with the 1980 grain embargo. They managed to have such a provision included in the grain-trade agreement when it was renewed in 1983.

Baldrige assured them that guarantees of contract sanctity have been included in the Export Administration Act now pending before Congress.

Also troubling to the Soviets is US legislation that withholds most-favored-nation trading status from the Soviet Union until it allows more emigration.

Currently, the backlog of Soviets wanting to emigrate -- mostly Jews wanting to leave for Israel -- is estimated in the tens of thousands.