593 



earnings for imports of needed machinery and equipment. 109 Such 

 changes may portend a more flexible Soviet foreign trade system for 

 the future. However, the evolution has not proceeded very far. 



In recent years, important new practices have helped to expand 

 Soviet commercial ties with the West. Coproduction ventures, joint 

 marketing arrangements, licensing agreements, and other special ar- 

 rangements play an increasingly important role in East-West trade. 

 Such practices will undoubtedly be used in furthering U.S.-Soviet 

 economic cooperation. 



However, many potential roadblocks remain. The trade agreement, 

 Export- Import Bank financing, and the Lend-Lease agreement, for 

 example, are contingent on congressional approval of MFN status for 

 the Soviet Union. Moreover, U.S. financial institutions may be unable 

 to provide sufficient credits to meet Soviet needs. Eximbank's resources 

 are apparently inadequate, and the Johnson Act still restricts private 

 loans to the Soviet Union. Furthermore, considerable differences of 

 opinion remain over interest rates and repayment schedules. Even if 

 all U.S. restrictions should be removed, limited Soviet export capabil- 

 ities might be a serious constraint on the volume of future trade. An- 

 other uncertainty is the adaptability of some Soviet foreign trade in- 

 stitutions to large-scale economic cooperation with the United States. 



Furthermore, there is still considerable opposition in the United 

 States to exports of certain kinds of U.S. technology. Although export 

 controls have been relaxed, questions on the national security and in- 

 dustrial espionage aspects of foreign trade continue to be raised. Even 

 technology transfers to long-time allies are sometimes questioned. The 

 sale of the Thor-Delta rocket to Japan, for example, was cited by a 

 representative of the AFL-CTO to Congress as an export of technol- 

 ogy with adverse national security implications. 110 Many technology 

 transfers to the Soviet Union are likely to be more controversial. 



The changes that have already been made seem likely to strengthen 

 trade ties between the United States and the Soviet Union, but many 

 obstacles to completely normalized economic relations remain. The 

 long-run growth of Soviet-American economic relations will depend 

 in large part on the continuation of the liberalization process. 



109 Nikolai Patolichev, U.S.S.R. Foreign Trade: Yesterday, Today, Tomorrow (Moscow: 

 Novosti Press Agency Publishing House, n.d.), p. 131. 



110 Mr. A. Biemieller to the Senate Finance Committee. Congressional Record, Mar. 6, 

 1973, S3977-3982. 



