C.I.A. SAYS SOVIET CAN ALMOST DO WITHOUT IMPORTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85M00363R000601440073-1
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: January 4, 2017
• Document Release Date: April 15, 2008
• Sequence Number: 73
• Publication Date: January 9, 1983
• Content Type: OPEN SOURCE

Approved For Release 2008/04/15: CIA-RDP85MOO363ROO0601440073-1
,GRTICLE APPEARED NEW YORK TINES
9 JANUARY 1983
C.I.A. Says Soviet Can Almost Do Without
By $ERNARD GWERTZMAN
Special to The New York Times
WASHINGTON, Jan. 8- The Central
Intelligence Agency, in a study of the
Soviet economy, - concludes that the
Soviet Union's ability to live without im-
ports is much greater than that of most,
possibly all, other industrialized econo-
mies.
The report, delivered to the Joint
Economic Committee of Congress on
Dec. 1 by Henry Rowen, chairman of
the C.I.A.'s National Intelligence Coun-
cil, seems to support the argument that
American trade embargoes against the
Soviet Union have only limited effect.
The Reagan Administration has
sought to tighten Western controls on
trade to the Soviet Union to bring politi-
cal pressure on Moscow, a policy often
at odds with European allies and with
some American businessmen.
Capital, Technology and Food
The C.I.A. report said that for the last
decade the Soviet Union has used trade
with the West to help modernize its
economy and make it more efficient. It
said that the Russians had relied on im-
ports of capital and technology to in-
crease or maintain production of some
raw materials and that food imports
had "become critical" to maintaining a
quality diet.
Imports of grain and other agricul-
Imports from the West, Mr. Rowen
re-
said, "can play an important role j po
lieving critical shortages, spurring_ technological progress and generally f
improving Soviet economic peform- I Mr. Rowen said the C.I.A. agreed
ante." But he added that "the ability of 1 with Mr. Proxmire that "confusion sur-
the Soviet economy to remain viable in I rounding the Soviet economy abounds."
than that of most, possibly all, other in-
dustrialized economies."
"Consequently,". he concluded, "the
susceptibiity of the Soviet Union to eco-
nomic leverage tends to be limited."
The Soviet Union has always put
great emphasis on self-sufficiency. This
dates from the earliest days after the
"Western observers have tended to
describe Soviet economic performance
as `poor' or `deteriorating' at a time
when Soviet defense spending continues
to rise, overall Soviet gross national
product in real terms continues to in-
crease and Soviet G.N.P. is second in
size only to that of the United States,"
he said, noting the apparent contradici-
countries did not recognize the Soviet As a result of recent declines in the
regime, and it continued as a result of rate of growth, the gap between per-
the isolation the country experienced in
World War II.
Mr. Rowen's report was prepared at
the request of Senator William Prox-
mire, Democrat of Wisconsin. The
Senator, who is vice chairman of the
subcommittee on international trade,
finance and security economics, hgd
asked for "a balanced assessment" of
the strengths and. weaknesses of the
Soviet economy.
This was the second C.I.A. report in a
month to point out strengths in the
Soviet economy.
tural products, it said, meant primarily
to prevent a decline in meat consump.
tion, cost the Russians $12 billion in
1981, or 40 percent of their hard-cur.
rency purchases that year.
But Mr. Rowen said that "despite the
large-scale expansion in agricultural
imports, the Soviet Union remains basi-
cally self-sufficient with respect to
food."
He said the average Soviet citizen .
consumes hpu 3,W calories a day, as
against 3,520'f an American. The re-
port showed that the Soviet diet consists'
of far more grain and potatoes than the
American diet, but less fish and meat
and less sugar. And Mr. Rowen said
that grain production in the Soviet
Union "is more than sufficient to meet
consumer demand for bread and other
cereal products."
The report said trade with the West
amounted to only 5 percent of the Soviet
gross national product. But it seemed to
agree with some Administration policy
makers when it said the Russians would
have to import 15 million to 20 million
tons of steel pipe in the next seven years
to build the pipelines it has planned, and
will need "sophisticated" exploration
equipment for its oil and natural gas
fields. The Administration has tried to
block those exports in particular,
provoking feuds with Western govern-,
1 ments that have contracted to provide
! the equipment.
The Soviet gross national product in
1982 was estimated at $1.6 trillion, or ;
$6,000 per-capita, roughly 55 percent of
.the American gross national product.
The C.I.A. estimated Soviet gold re-
serves at 200 million troy ounces, giving I
)it 35 percent of the world total. Produc-
tion in 1981 was estimated at 325 tons
and its stock at about 1,900 tons, worth
over $25 billion at current prices.
The report said a major weakness in
the economy was the declining growth
of the work force, with only 9 million ex-
pected to join in this decade as against
19 million in the 1970's.
Agriculture remains the weakest
link. Grain production achieved a
record high of 237 million tons in 1978
but has not reached 190 million tons
since then. The report also highlighted
problems in poor administration, bot-
tlenecks in industry, an overworked
railroad system and depletion of many
mineral reserves.
energy as a whole was increasing, with
oil up by about 1 percent and coal 2 per-
cent in the past year. The Russians
have also improved their trade with the
West, cutting their deficit from $4 bil-
lion in 1981 to $2 billion in 1982.
formance and expectations, and the
lack of economic efficiency, "the
record compiled by the Soviet economy
in recent years has indeed been poor,"
he said.
"Results that are unsatisfactory
when measured by this yardstick, how-
ever, do not mean that the Soviet econ-
omy is losing its viability as well as its
dynamism," the C.I.A. official said.
"In fact, we do not consider an eco-
nomic `collapse' - a sudden and sus-
tained decline in G.N.P. - even a re-
mote possibility," he said.
The- C.I.A. projects, he said, that
Soviet economic growth "will remain
slow but positive," averaging 1 to 2 per-
cent "for the foreseeable future," al-
though per capita consumption might
level off or drop slightly.
Energy Production Rises
Mr. Rowen said that natural gas pro-
duction had continued to increase at a
rapid rate, 8 percent in 1982, and that
Approved For Release 2008/04/15: CIA-RDP85MOO363ROO0601440073-1