1796 



ventures. Little attention appears to have been given by the diplo- 

 matic community as to ways in which new technology for the seabed, 

 in the hands of the private entrepreneur, could advance the goals of 

 diplomacy. Nor does the private business community appear to have 

 given much thought to ways in which it could act profitably in 

 developing seabed resources so as to further U.S. diplomatic goals. 



Clearly, the minerals on the floor of the ocean are an immense 

 resource for the future. Even so, the unplanned exploitation of this 

 resource could disrupt industrial patterns, impair the ocean ecology, 

 provoke international confrontations, and obstruct progress toward 

 rational resolution of the question of seabed sovereignty. Once private 

 industry established the technology, the systems, and the commercial 

 structures for seabed exploitation, there would be resistance to any 

 change in the rules of ownership, however unsatisfactory these rules 

 might be. 



CASE six: u.s.-soviet commercial relations 



The origin of this case lay in the May 1972 summit meeting between 

 President Nixon and Secretary General Leonid Brezhnev of the Soviet 

 Union. From this summit meeting there developed a Joint U.S.- 

 U.S.S.R. Commercial Commission, various trade agreements, bilateral 

 science pacts, and other agreements. 



The theme of the study was that detente, cautiously approached, 

 might help motivate the Soviet leadership away from the arms race 

 and toward joining the world economic system, modernization of their 

 civilian economy, and expanded production of consumer goods. 



The role envisioned for U.S. industry in tliis evolving relationship 

 would be to provide the Soviet Union with a highly selective set of 

 technologies, coupled with technically oriented management. In re- 

 turn, the Soviets would provide the United States, initially at least, 

 with materials deficient in this country and products in which the 

 Soviet Union enjo^'ed a comparative economic advantage. The case 

 study enumerated as potential U.S. exports electronics, agribusiness, 

 petroleum refining, and automotive tooling and forging equipment. ^^'^ 

 Also mentioned were advanced industrial systems for oil and gas 

 production, improvements in communications systems, and facilities 

 to encourage tourism. However, these exports were greatl}^ overshad- 

 owed by the huge grain deliveries to the U.S.S.R. in 1972 and 1973. 



Soviet short-term prospects for export to the United States were 

 also assessed in the study, and included furskins, petroleum and 

 natural gas, nonferrous metals (nickel, platinum, palladium, and 

 chrome ore in particular), and possibly wood and wood products, coal 

 and coke, and other raw materials. If the United States elects to ex- 

 tend most-favored-nation status to the Soviet Union and ease tariffs 

 on Soviet manufactured goods, Soviet exports of some manufactures 

 might find U.S. markets. 



One problem facing U.S; industry in undertaking projects in the 

 Soviet tlnion, as well as U.S. exporters to the U.S.S.R., is the control 

 structure of the Soviet economy. As a state-trading monopoly, the 

 wSoviet Union confronts the U.S. negotiator with a formidable array of 

 officialdom. U.S. industry will need to feel its way into this relation- 

 's Ilardt and HoUiday, U.S.-Soviet Commercial Relations, Vol. I, pp. 572-575. 



