JPRS ID: 10542 EAST EUROPE REPORT ECONOMIC AND INDUSTRIAL AFFAIRS

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• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000500060055-0
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JPRS L/ 10542
26 May 1982
- E ast E~ ro e R e o rt
p p
ECONOh'11C AND II~DUSTRIAL AFFAIRS
CFOUO 4/82)
L
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JPRS L/10542
26 Diay 1982
EAST EUROPE REPORT
ECONOMIC 4ND INDUSTRIAL AFFAIRS
(FOUO 4/82)
Cd~~TENTS
HUNGARY
Italian Paper Cites Hungarian Sourcea on Economy
(Frane Barbieri; LA STAI~A, 25 Apr 82) 1
POLAND
Polish Bank Offic~al on Rescheduling Debt
(David Buchan, Christopher Bobinski; FINANCIAL
" TIMES, 12 Mar 82) 6
Poliah Official Predicts Shift in Trading Pattern
(Roger Boyes; THE TIMES, 4 Mar 82) 8
~
- a- ( II I- EE - 64 FOUO]
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HUNGARY
ITALIAN PAPER GI1'ES HUNGARIAN SOURCES ON EC4NOMY
PM29104.s Turin LA STAMPA in Italian 25 Apr 82 p 5
[Di~patch from Frane Barbieri: "Hungary's Polish Gains'']
[TextJ Budapest--Paradoxically, the best interpretation of Kadarism that
I h~ve heard was from a Catholic prelate. I visited the primate'r~ e�eat
at Eszetergom, where Canon Bartl was authorized to convey Archbishop Lekai's
_ thoughts to me. When I observed that the Hungarian church is accused of
exces:sive compliance Goward thE government--a criticism stemming primarily
from Warsaw--the priest replied: "Yes, our position is often criticized
by the Poles. But the archbishops always says: Hungary is differerrt from
the other people's democracies. We are criticized for no~ conf.ronting the
state, but the arc:hbishop says: Since in our country social problems are
resolved to sucY~ a~i extent that all citizens are protec~~ed, the people
are satisfi~_.a and the church is not foiced to attempt a b attle, as it is
in Poland, where people are hiaigry and suffering as a result of serious
problems. In our country, as the archbishop says, we prefer the policy of
small steps."
Next ne talked abou;. Kadar: "Kadar himself, who is respected by everyone,
repr~~sents national interes[s. It is a divine mercy to have him. TF2re-
for~~ the church does not have the impr~ssion that it has to represent the
nation's intere~cs with r.espect to anyone else." Is it possib le that
_ "Gulag" socialism has led a"Gulag" religion too? No, Father Bartl said;
everything is not ideal as far as religious matters are concerned, but that
prasperity create~ a relaxed atmosphere in which, by me~ns of cont�inuous
_ negotiations and "without any banging of fists on the table," it is possible
- to move toward the church's objectives. He said: "If we asked for every-
thing in advance, we would have ruled out the paths of comprotaise."
He issued a curious verdict on Wojtyla: When he was ele~ted it was feared
that he woi:l.d impose the Polish line but then, by retaining Caseroli, the
pope showed that he appreciates the policy of small steps. Monsignor Poggi
apparently also confirmed this on his visit to Budapest a few days ago.
T'he ecclesiastical interpretation of the Hungarian miracle basically
coincides with the Marxist theories on Kadarism; prosperity gradually leads
to freedom and democracy. The Polish idea, the one held by the church and
Solidarity, was reversed: F~:aedom to achieve prosperity. A hast,y appraisal
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would be that the Himgarians are entirely right. However, not even the
miraculous Htmgarian idyll provides sufficient evidence that material
prosperity les.ds automatically to democratic fredoms. The almost ingenious
reformism in the economic field has not,in tt�e least affected the polttical
an3 social sphere. It is Kadar's pragmatic style (with a touch of skeptical
detachment) that gives the system the element of tolerance--certainly not
Che ideocratic institutions.
This being so, it remains to be seen whether prosperity will always remain
at the level needed to allay political and social thrusts and whether it is
conceivable for demands for an adequate political structurF not to emerge
in the presence of an erficient economic machine.
The idea of an all-embracing economic approach is en countering difficulties
in view of this uncertainty. This was revealed _o me by [Director of the
Research Institute of World Economy of the Hungarian Academy of Sciences
Jozsef] academician Bognar, a leading economist: "Now the need is emerging
to transfer the state economy to society. I do not trust the systems
without contradictions inherent in the utc+pian ide als of the last century.
The contradicti~~~ns must be highlighted because the state is based on the
~~ation. Economists do not like the nation, however; they like the state.
But let us not forget that not all states have a nation anc'. not all nations
have a state. The vast majority of people are aware that our situation
is better than our neighbors', but new demands are emerging, especially
among young people who lack the mentality and the memory of the old. This
emphasizes the need to move toward greater frePdom. In a strictly disciplined
society this is impossib le."
Engrossed in tiirning the rubic cube of the economy this way and that, the
government defiuitely seems behind in considering political reform. Some
members believe that it is enough to impart a Christian democratic substance
to existine structures, others that new forms of democracy must be made
to emerge from the peoi~Ze's unrest. Thi.s is what [Himgaria?: Socialist
Workers Party] Central Commitee member [Peter] Renyi said: "lc may be a
htretical idea, but I believe t:1at a crisis ceuld even be positive, because
it would destroy the dogmatic way of thinking."
Indeed, many people have a feeling that there will be an imminent crisis.
Not so much as a result of the Polish epidemic as because of the unlikeli-
hood of maintaining high living st_andards. The government is planning a
halt at the present level, with a symbolic growth of 1 percent, but current
prices do not confirm these forecasts. How will it be possible to manag�
the conf licts and antici~pate the unrest? There is a fear of excessive
order but also a fear of excessive disorder.
Officially there is no dissidence among young people and intellectuals.
The argument "let us not cre~te difficulties for Kadar" has always prevailed
over attempts at opposition. In exchange the ~imits of tolerance of
artistic expression--in literary ~ournal.s, in the theater and above all in
films (the protest movies of the Rakosi period are significant)--are exter~ded.
In research and the sciences, however, economics has dominated sociology
and philosophy. Paradoxically, Stalinist former Prime Minister Hegedus
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has remained virtually isolated in his iv~ry tower of lukacs-style critique.
In this connection there is no evidence of either a hungarian workers
defense committee or a resurgence of the Petofy clubs, the intellectual
catalyst of tlre 1956 uprising. Indeeed, the intelligentisa submits to the
party verdict, according to which tne clubs were "dens of coia?terrevolu-
tionary revisionism."
While among intellectuals there is r.o rebirth of old Marxist ideas--the ideas
of human alienation, the obsession with the young Marx as origi.^.ator of new-
left dissidence--early Christian protest is emer~ing within the Catholic
ranks. The b ishops are grappling with oppositionist priests. There are
about 100 of them, centPred on Father Bulanyi. They demand "the return to ~
prayer" and criticize the bishops for having become integrated into the
estab lishment. The "hardliners" (there are apparently som~. 100,000 supporters)
are, in the opinion of priest an~? deputy [and director of l~ctio Catholica
ImreJ Varkonyi, "subversives opposed to the episcopate and to socialism,"
- and moreover "false pacifists." Lekai has already warned t}~e clergy against
following Bulanyi, invoking Kad4r more than papal encyclicals.
Then there are the trade unions. I asked Secretary of the National Trade
Union Coimcil [Fe*-enc] Sol.yom w?:at lesson has been learned from events in
Poland. He replied: "They show us that decisions cannot be taken a~~er
the workers' heads, without the workers." For Htmgary too "there is a need
for a new trade union movement." It will emerge, however, within the
existing official trade union, not from a spontaneous workers initiative
(condemned back in the verdict passed on the 1956 uprising).
Some measures have been adopted in this direction: For insta~�~~~, ~he trade
union ha.~ the right to veto all decisions by the factory management regarding
pay and workin g conditions; the trade union chief belongs to the "quadrum-
virate" that determines enterprise policy and includes the manager and the
~ party, communist youth and trade tm ion secretaries; last, every year the
trade union gives the ministry its opinion of the manager, an opinion that
can, but need not, influence the renewal of his mandate. But has the
nub of the conflict between Walesa and Jaruzelski--namely who should appoint
the director--been tackled in Hungary? In practice, no, inasmuch as
Jaruzelski's rule applies: The stat~a owns the enterprise and therefore
appoints the managers.
In a book by trade union president and Politburo member Gaspar I read,
however, that in the future factories will tend to beco~ue workers coopera-
tives, like the farms, not vice versa. Solyom explained to me: "In fact
the policy is to socialize enterprises primarily in their management,
leaving only the general development guidelines to the state."
[Question J So does the manager represent the state or .the woI'~f:~~-~e?
[Answer] For the time being the valuation is mixeri, i~lhere participation
is more limited, he is regarded as a man of the state, but there are already
examples where the manager is regarded as a representative of the workforce.
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We have placed the problem of appointments on the agenda, and the trade
union's opinion is already the first step.
[Question] What about self-management? Is that another Polish obstacle?
[Answer] We do not say self-management, thaugh in practice it will exist.
[Answer ends]
They do not use this te rm for curious reasons: In the 1956 uprising self-
management was the slogan of the rebels in the big factories, who are now
proclaimed to be counterrevolutionaries inspired by the Yugoslav revisionists
and by Western imperialists (as stated in the party history published on
the 25th anniversary of the uprising). Moreover, the Soviets are allergic
to the world self-management because of both Yugoslavia and Poland.
In Budapest's major work sites 7 tried to establish to what extent this new
mechanism works in practice. The enterprise is autonomous to the extent
of the one-t'nird of the prof~.ts that remain available to it after the state
has deducted two-thirds. The manager considers himself an interlocutor on
a par with the minister. What about the trade unionist with respect to
the manager? I asked him: I~ave you ever used the veto? He replied:
"No, but the fact that we are able to use it is in itself a f~ction."
[Question) Have you ever gone on strike?
[AnswerJ No, the right to strike exists but we do not consider it too
beneficial for socialism.
[QuestionJ Have you expressed your opinion of the manager?
[Answer] Yes, for the fourth time.
[Question] Was i~ favorable?
[Answer] Yes: There are more problems where it would have to be unfavorable.
In those cases it is often not expressPd.
[Question] Do you think about self-management?
[Answer] In our cotmt~y the tas k of management has been clarified, there
is no sharing or confusion of tasks. T^.:is does not mean that the trade
union must not be consulted on the plan and nn the distribution of profits.
We liave a duty to stimula~e the production forces, because to demand pay
without producing enough is illogical. [Answer ends]
In other words, a trade union that could be envied by other Eastern b~.oc
workers, but even more by Western indtistrialists.
The most intensive social dialectic still seems to be between Ujpest and
Ferencvarosi [soccer clubs] supporters, partly because Kadar has had the
wisdom not to disclose his own preferences with regard to soccer. Basically,
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- cf all :.he single-party and monolithic institutions of Kadarism, the most
~ denocratic, open-minded and tolerant is still Kadar himself--"a rea~ divine
miracle," according to the priest-deputy Varkonyi. According to party
ideologue Renyi, he is "the man who did not invent b ut who intuittvely
~ grasped this line that has extricated us from terrible confusion. A man of
resolute will and strong nerves, determined in politics and with a mentality
- of gradualism, of snall steps foward."
~ The only threat to K.adarism is that events can sometimes proceed by larger
steps. This fear was expressed to me by a political analyst on a relaxed
~ free Saturday granted by Kadar, while a free Saturday denied by Jaruzelski ,
is causing Poland's collapse.
I COPYRIGHT: 19c~2 Editrice LA STAMPA S.p.A.
CSO: 3104/203
~
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~
POI.E~I~TD
- POLISH BANK OFFICIAL ON RESCHEDUI.ING DEBT
PM121429 London FINANCIAL TIMES in English 12 Mar 82 p 1, 40
[Dispatch by David Buchan and Christopher Bobinski: "Polan~ Cuts Arrears
~ on 1981 Western Bank Debt"]
[Text] Warsaw--Poland has reduced the interest arrears on its 1981 debt to
Western banks to "almost zero"--$lOM-$20M and is confident of finally signing
a formal rescheduling of its 1981 debt of $2.4Bn by the end of this month,
_ Mr Marian Minkiewicz, president of Bank Handlowq, Poland's foreign trade
bank, said yesterday.
In an interview, Mr Minkiewicz and Mr Jan Woloszyn, his deputy, who handles
the complex negotiations with more than 500 Western banks, made c:lear that
rescheduling a similar amount of Western bank debt falling due this year
could be more difficult without a marked improvement in Poland's hard cur-
rency trade balance.
t4r Minkiewicz said it would probably be impossible if Western governments
did not agree to ieschedule the $2.2Bn which they have guarant~ed and which
also falls due this year.
Mr Woloszyn admitted that in its talks with Western banks, Poland was trying
to bring pressure to bear on their governments to reschedule. Most Western
governments have refused to reschedule their debt until General Wo~ciech
Jaruzelski, Poland's military leader, ends or significantly relaxes martial
law.
The leaders of Handlowy Bank, which handles all Poland's foreign exchange
dealings, stressed that it was in Western bankers' interest to grant Poland
speedy short-term trade credits. This would help imprcve export earnings
and aid Poland's ability to repay.
"We have had indications that some commercially-minded banks might do this,
incltading one major West German bank," although only after Poland had met
all its obligations on 1981 debt, said Mr Minkiewicz.
The Soviet Union has not given Poland any further hard currency loans so far
this year. Last year Moscow lent Poland $465M and rescheduled about $999M
of earlier loans in convertible currencies.
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I~r Minkiewicz said, partly as a result of General Jaruzelski's successful
trip to Moscow early this month, the Soviet UniQn had speeded up deliveries,
largely on credit, of raw materials such as cotton, iron ore and metals.
Parliamentary deputies in Warsaw have been told that the Soviet Union has
undertaken to deliver between 25 and 40 percent of its totai planned 1982
shipments to Poland by the end of this month.
"Up to now we have given equal treatment to all banks and governments," said
Mr Minkiewicz. But if some countries refuse to reschedule and other govern-
ments are ready to, we would dj_fferentiate in our attitude to them." Austria
in particular is "interested in maintaining its energy imports like coal
from us, and its exports to Poland," Mr Wolosyn claimed.
The bankers explained their arithmetic on Poland's parlous financial situa-
tion this year. Total debt obligations falling due this year amounted to
$lOBn, of which $7Bn was principal and $3Bn interest, they said. Of the
$7Bn, $2.2Bn was owed to Western governments, $2.4Bn to Western banks, and
most of the rest to COMECON countries.
The Po3_ish officials expect hard currency exports to reach about $6-7Bn this
year. But since imports had been drastically squeezed for lack of credit,
hard currency trade might be $0.5Bn-1.OBn in the black. They declined to
comment on the possibility that, without a fresh currency injectioa from
Moscow, Poland might not have enough to pay the interest on even a rescheduled
1982 Western bank debt.
Mr Minkiewicz said Poland was still interested in membership of the Inter-
national Monetary Fund and denied it was dragging its heels with the IMF,
which sent a team back to Warsaw this week.
The Polish Government was not counting on any IMF loan this year in its
calculations. But the Bank Handlowy commented that many of General
Jaruzelski's government's recent measures, such as the February price
increases, wuuld be just what the IMF "doctor" would order, if and when
Poland entered the IMF and drew a loan.
COPYRIGHT: The Financial Times Ltd, 1982
CSO: 2020/37
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POLAND
POLISH OFFICIAL PREDICTS SHIET IN TRADING PATTERN
PM041309 London THE TIMES in English 4 Mar 82 p 6
[Roger Boyes dispatch: "Poles To Reduce Trade Links ~.�ith the West"]
[Excerpt] Warsaw, 3 Mar--Poland is preparing a radical shift in its trading
pattern to minimize its economic dependence on the West, according to ar~
official who accompanied General Wojciech Jaruzelski, the Polish leader, to
Moscow.
The official, who w~nted to remain anonymous, said three levels of economic
aid had been discussed in Moscow. First, there was Soviet assistance to
relieve the immediate effects of the West's limited sanctions against Warsaw.
Second, there would be COMECON assistance to increa~e the use of industrial
capacity in Poland and ease unemployment there. Finally, long-term plans for
completely changing the f ocus of Poland's trade with the world were discussed
in the talks with President Brezhnev and other Soviet leaders.
This last point, the off icial said, represented "a turning point", indicating
that it meant a much deeper relationship with the Eastern bloc. Meanwhile,
the Soviet Union was giving assistance in hard currency to help Poland "through
these troubled times."
The official, an officer in the Polish Army, emphasized parts of the f inal
communique that acknowledged Poland's right to settle its own problems without
foreign interference'and recognized that Poland's borders were just and inter-
nationally guaranteed.
~ Although ~hese comments were intended to demonstrate that the United States
has no right to interfere in Polish affairs, a long-standing complaint since
martial law, they are also significant when made in the context of a trip to
Moscow, underlining the Soviet willingness to allow Poland time to find its
own way out of the crisis without direct interventi~n.
COPYRIGHT: Times Newspapers Limited, 1982
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