SOVIET GOVERNMENT-TO-GOVERNMENT AGREEMENTS WITH INDUSTRIAL WESTERN COUNTRIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001900010051-1
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 29
• Document Creation Date: December 19, 2016
• Document Release Date: May 17, 2006
• Sequence Number: 51
• Publication Date: November 30, 1973
• Content Type: MF

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CIA Plo. 7889
"O iIOV 1973
PiEM-ORA!Mu FOR: !tr.. E'lilliam Morell
Special Asristrnt to the Secretary
for National Security
Der.. artment of the Treasury
sap- tCT : Soviot Government-to--Govornrient Agreements
with Xndustrial Western Countries
In response to your request concerning Soviet interest
and participation in long-term cooperation agreements with
industrial Western countries, we have put together the
attached study. 7f we can be of any further assistance
this subject, please let us know.
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25X1
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HAURICI: C. ERNST
Director.
Economic Research
Attachment :
As statood
Distribution:
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](30 Nov 73)
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CONIDNIALL"
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Soviet Government-to-Government Cooperation
Agreements with Industrial Western Countries
Introduction
1. In recent years the USSR has concluded a number
of framework agreements with industrial Western governments
covering economic and technical cooperation.l/ The purpose
of this brief is to examine the agreements with Western
countries and assess their role in Soviet economic relations
with the West. For purposes of achieving perspective, a
brief discussion of trade agreements is also included.
Background
2. In the early postwar years, Soviet trade with
Western countries was based largely on one-year trade and
payments agreements, if indeed there was any formal agree-
ment at all. Imports from the West were largely for making
up shortfalls in domestic production, and exports were gen-
erated to pay for the imports. As trade with the West grew
in the 50s and 60s and Western products and technology be-
came increasingly important to the Soviet economy, the USSR
endeavored to formalize trade through a series of long-term
trade and payments agreements covering three to five years.
If, as the Soviets have claimed, these agreements provide
a more stable base for planning trade, there is little
evidence to suggest that they, in fact, have fulfilled this
role. Chronic trade deficits over the last decade and
occasional radical shifts in exports and imports of various
products indicate otherwise.
1. These agreements generally cover not only cooperation in
the economic and industrial spheres, but also scientific
exchanges. Some agreements call for cooperation only in
science and technology. Subagreements within this overall
framework are the specific scientific, technical, and
industrial pacts negotiated to carry out the aims of the
overall agreement. Considerable overlap occurs between
technical and industrial in this context, but for the pur-
poses of this brief technical refers to the exchange of
technical information or personnel and industrial refers
to the exchange of equipment, data, or know-how involved in
an industrial product or process,
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3. The mid-60s saw an acceleration of efforts by the
Soviets to acquire Western equipment and technology to spur
domestic economic growth and overcome its technological lag.
One of the features-of these initiatives was the conclusion
of scientific and techn:.cal agreements with private Western
firms and later with governments. Through these agreements
the Soviets hope to gain greater access to Western know-how
and technology.
Highlights
4. The conclusion of framework cooperation agreements
between the USSR and industrial Western governments began
essentially in the mid-60s and has continued to date"?/ The
USSR has concluded them with about a dozen industrial Western
countries.3/ The first broad intergovernmental. cooperation
agreement was concluded with Italy in April 1966; a more
elaborate agreement was signed with France in the summer of*
the same year. Subsequent agreements were concluded with
Austria in 1968 and the United Kingdom (science and tech-
nology only) in 1968; Belgium-Luxemburg in 1969; Denmark
and Sweden in 1970; the Netherlands in 1971 and Canada in
1971 (science and technology); Norway in 1972,and West
Germany in 1973. Agreements were renewed for 10 years with
,France and Austria in 1973; a renewal agreement with Italy
was initialed in 1973; and in the same year draft 10-year
agreements have been tabled for consideration by the United
Kingdom and Belgium.
5. Prior to the intergovernmental agreements, the USSR
had concluded many agreements with individual firms, non-
governmental organizations such as trade associations, and
some quasi-government institutions. Economic cooperation
with Japan is based on an agreement with the Japan-Soviet
Economic Committee composed of Japanese firms and Soviet
trade organizations. A number of the nongovernment agree-
ments remain in force and more have been concluded on the
basis of A-':e intergovernmental agreements. Framework agree-
ments have now been concluded with all the major Western
industrial countries except Japan and the United States.
A cooperation agreement was concluded in 1955 with Finland
with whom the USSR has a special relationship. See page 14
below.
3. See Appendix A for listing of agreements.
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6. The conclusion of cooperation agreements with the
Common Market countries has special importance for the USSR.
Under EEC rules, beginning in 1975 trade agreements must be
negotiated with the EEC Commission rather than separately
with member countries. Cooperative agreements, which do not
directly include-trade deals or terms under which trade will
be conducted, fall outside the Commission's jurisdiction and
may be negotiated bilaterally. The,USSR, by concluding such
agreements with EEC countries, is hoping to maintain bilat-
eral ties with the individual countries beyond 1974.`
7. The framework agreements vary. Virtually all the
agreements signed before 1973 call for cooperation in broad
sectors of the economy -- industry, agriculture, transpor-
tation, for example, but in some cases in specific branches like
machine tools, ferrous metallurgy, etc. The 1973 Soviet-
West German agreement follows'the former format, the 1971
Soviet-French agreement, the latter, Still others are more
restricted in scope, e.g., science and technology exchanges
only. The 1973 agreements -- concluded or tentative --
usually call for a life of 10 years. Most of the earlier
ones are open-ended. All of the broad 1973 agreements
stress long-term cooperation presumably in major development
projects. The 1973 Soviet-French agreement, like the 1971
agreement, is specific with respect to fields of cooperation.Y
8. Mixed commissions are involved with implementing
these agreements -- either established before the agreement
or by the agreement. The commissions are at least a partial
solution to the problem of stimulating the interest of
Western firms in participation. They are staffed with high-
level government officials from both sides who together seek
to identify potential areas for cooperation. Once such
areas are identified, working groups -- comprised of repre-
sentatives from Western firms and Soviet officials -- are
established to fur.thor delineate and encourage cooperative
possibilities. The commissions, in turn, monitor the pro-
gress of their working groups and act as a channel for
bringing problems to the attention of high government leaders.
Soviet negotiators are more comfortable in such a bureaucratic
The Cornmissior,'now wants a control. over the cooperation
agreements claiming that they are concerned with trade since
thcq provide for payment in goods or foreign exchange for
goods and services from the Common Market.
5. Copies of the 1971 agreement with France and the 1973
agreement with West Germany are in Appendix B.
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environment, and Western firms are encouraged by official
backing given to the discussions. The mixed commissions
also have served as the source for subsequent long-term
framework agreements. This has been the case in the UK,
Italy, and France where they have drafted additional
cooperation agreements which more closely address the
particular types of cooperation deals that appear most
beneficial.
9. Government-to-government cooperation agreements
with industrial Western countries are highly valued by the
USSR. By participating in these agreements, the Western
government is made to feel a responsibility to encourage
private business participation in the exchanges and trade
contacts. In addition, government participation presumably
can make Western firms more willing to participate because
they expect government cooperation in facilitating trade,
financing, and the like. These are pluses for the USSR,
but perhaps the value of the agreements is overestimated
by the Soviets. Experience with long-term trade agreements
has shown that they do not guarantee that Western firms
will conclude contracts with the Soviets. On balance, the
cooperation agreements do not appear to stimulate cooperation
to any significant degree. The greatest input appears to
have been in France and Italy. Even Italy and France, how-
ever, where government influence and control. over business
and industry is substantial and where the governments have
shown grea?k.er willingness to cooperate with the USSR than
other Western countries, have often been frustrated by the
reluctance of the private sector to conclude deals or to
accept low quality Soviet goods.
10. The framework agreements are useful for the Soviets
because they provide a bureaucratic framework for negoti-
ations. In themselves, however, they neither provide
stability to nor facilitate planning. The specific projects
which are formulated under a framework agreement and bilat-
erally approved obviously are integrated into the plan, and
long-term projects are made part of the long-term. plan.
In this sense the framework agreements are indirectly help-
ful to the planning process. But agreements on specific
projects do not require the existence of broad agreements
just as trade does not require formal trade agreements.
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Agreements with Western Countries
France
11. Soviet-French economic cooperation has developed
from the special Soviet-French relationship. In the mid-
60s the French under de Gaulle were particularly interested
in concluding an agreement with the USSR to gain an edge
over Western competitors in the Soviet market.
12. In 1966 the two nations signed a broad agreement
on cooper-tion, establishing a high-level government group the Grand Commission -- to oversee the total structure of
bilateral agreements.!/ At this time the two countries also
signed an agreement on scientific, technical, and economic
cooperation, which in turn was to be supervised and imple-
mented through a second mixed commission -- the Petite
Commission -- and its subordinate working groups. The main
thrust of the latter agreement was directed toward expanding
the exchange of scientific and technical information via
delegations., technology transfers, and joint research efforts.
1:3. The French have been relatively forthcoming in
providing scientific and technolo~jical know-how as part of
the cooperative schemes concluded under the 1966 agreements.
The Soviets appear to have been the major gainers in this
respect, although the gains cannot be measured accurately.
The French, on the other hand, increartod exports to the
USSR from $160 million in 1966 to more than $400 million
in 1972 while Soviet exports increased only about half that
amount.!/ To be sure, much of the French export growth'was?
predicated on generous French credits, but the French managed
to increase its share of the Soviet market at the expense
of other Western countries.
14. Soviet-French cooperation was reinforced in 1971
with the signing of a 10-year economic agreement prepared
by the Grand Commission. Unlike the 1:'66 accord, the new
agreement -- while general in nature -- stresses the pro-
motion of long-term cooperation in major development pro-
jects. The two countries have, in fact, concluded several
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Based on Soviet data. See Appendix A for Soviet trade
with selected Western countries.
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project agreements in recent years, including a natural
gas-for-equipment deal and the Soviets part]'ipation in the
French construction of a steel. mill and oil refining com-
plexes.
15. In July 1973 a second ten-year economic agree-
ment -- called by the French a supplementary agreement --
was signed in Moscow at a Grand Commission session. It
enumerates more specifically than the 1971 agreement areas
of potential cooperation. This latest agreement was appar-
ently concluded at the request of the French, who felt that
their special relationship with the USSR was being threatened
by the US-Soviet detente. A major cooperative venture
stemming from this agreement calls for the supply of a French
pulp combine to the USSR to be paid off in products. Other
ventures were also mentioned in the agreement and additional
French credits were promised. A separate 10-year scientific
and technical agreement was also concluded, but this evi-
dently was mainly for cosmetic purposes.
16. In contrast to most of the other Western countries,
the initiative for these agreements has not come largely from
the Soviets. For political reasons and to capture a bigger
share of the Soviet market from the more competitive Germans
and Japanese, the French government has urged its industri-
alists to expand their relations with the Soviets. French
businessmen have succeeded in expanding exports to the USSR
but have resisted importing Soviet manufactured goods be-
cause of the poor quality of most of them.
17. Franco-Soviet trade agreements have complemented
and supported cooperative efforts. The latest, signed in
1969, called for a doubling of trade over the five-year
period it covered.!/ In addition, the pact called for new
measures to stimulate French imports from the USSR, espe-
cially manufactured goods.
Italy
18. The Italians have been quite active in expanding
economic cooperation with the USSR, and Italian firms were
among the first in the West to conclude large scale cooper-
8. The trade agreement expires at the end of 1974. As-
indicated above, beginning in 1975 individual Common Market
countries may not conclu'e bilateral trade agreements.
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ation agreements with the Soviets. En the late 50s'ENI of
Italy concluded a $200 million swap agreement with the USSR
involving It,,lian pipe and Soviet oil. in April 1966 the
two governments concluded a basic framework agreement calling
for economic, scientific, and technological cooperation in
several sectors,but specific reference was made largely to.
industrial technology and modernization and to exchanges in
science and technology. A mixed commission was formed by
the agreement and, through the use of working groups, was
tasked with implementing the agreement's directives. Given
the quasi-public nature of Italy's major industrial and
financial firms, the Soviets have been particularly success-
ful in stimulating cooperation on a commercial level, e.g.,
the Fiat's participation in building the large motor vehicle
plant at Tol'yattigrad and the natural-gas-for pipe deal in
1969.
19. At their February 1973 meeting, the mixed commis-
sion agreed that an additional ten-year cooperatioa agree-
ment should be formulated, patterned after the more compre-
hensive Soviet-French agreement. An agreement was subsequently
initialed in May and currently awaits final signature. It
is believed that the agreement will cover specific areas of
cooperation, probably including activities discussed at the
meetings of the mixed commission's last session, e.g.,
expansion of the Tol'yattigrak: plant.
20. Italian exports to the USSR grew substantially --
from $95 million in 1966 to $317 million in 1969 -- and in 1969
Italy reversed its usual deficit with the USSR. Italian
exports have failed to increase s4.nce that time and imports
have climbed to the point where trade is now roughly balanced.
The Italians are attempting to stimulate this trade. The
trade agreement concluded in 1970 calls for increases in
trade, but trade and cooperation' probably will not grow
measurably without Italian credit. Recognizing that long-
term credit is essential to the development of Italo-Soviet
trade, the Italiayis have provided ample amounts. The last
credit line -- offered in 1973 -- was for $600 million.
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United Kingdom
21. The United Kingdom has been a trading partner of
the USSR since the latter's formation, although there was
no postwar trade agreement between the two countries until
1959. The UK was also one of the first Western countries
to conclude a government-to-government agreement with the
USSR in the science field. An agreement was signed in 1965
to formalize and facilitate scientific exchanges between
the two countries. Cooperation was broadened and intensi-
fied as a result of a 1968 agreement covering cooperation
in technological research and development, industrial tech-
nology, and long-term industrial development. This latter
agreement called for the formation of mixed working groups
to study specific areas of potential cooperation, and pro-
vided for annual meetings between representatives of the UK
ministry of Technology and the Soviet State Committee for
Science and Technology.
22. Although some progress was made through the use
of the initial working groups established in 1968, the two
nations agreed in 1970 to form a special commission to
further emphasize the potential for industrial and technical
cooperation. This high level mixed commission concentrated
on exploring areas for cooperation, with the British -- who
have yet to conclude a major cooperative venture with the
USSR -- seeking to exploitpotential opportunities for
increasing British exports of capital. goods to the USSR.
The Soviets, for their part, are bidding for British govern-
ment support for the conclusion of major cooperative projects
of interest to the Soviets. At its second meeting, held
earlier this year, the commission recommended the signing
of a 10-year cooperation agreement which would better identify
those opportunities for British industry and which would
probably increase the level of official British support for
those major cooperative projects currently under consideration.
23. The USSR and the UK also c-.cluded a trade agree-
ment in 1969. It specifically calls for the facilitation
of long-term cooperative agreements. In contrast to all of
the USSR's other major Western trading partners, British
exports to the USSR have fallen over recent years -- from
$273 million in 1968 to $226 million in 1972 -- and the UK
probably hopes that increased cooperation will ultimately
lead to a higher level of exports to the USSR.
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West Germany
24. West Germany has been the USSR's chief Western
supplier in the past few years. Soviet imports from West
Germany grew from $'350 million in 1969 to more than $700
million in 1972. Exports have lagged considerably, coming
to about $325 million in 1972. The growth of Soviet-West
German trade has come about in spite of the fact that no
formal trade agreement existed from 1963 to 1972. In fact,
one of the largest cooperative venture agreements concluded
between the USSR and a Western country was signed in 1970,
involving the swap of West German large-diameter pipe for
Soviet natural gas.
25. No formal agreements were concluded between the
two countries until 1970 -- in this instance a scientific
exchange agreement between the USSR and the German Research
Society which was designed to produce an increased level of
exchanges of scientific delegations. Following the 1971
meeting between Brezhnev and Brandt in the USSR, however,
movement toward increr.. 3. economic and technical cooperation
was accelerated.
26. A mixed commission for economic and scientific-
technical cooperation was formed in 1971 to examine the
potentials for Soviet-West German cooperation, and the first
meeting was held in 1972. The Soviets sought to direct the
commission's activities toward industrial technology trans-
fer and specific cooperative projects. The USSR was anxious
to increase the level of German governmental support for
such agreements and encouraged the conclusion of a broad
intergovernmental agreement on cooperation.' A Soviet-West
German Trade and Economic Cooperation Agreement was sinned
in April 1972 which provided for the creation of a high-
level intergovernmental committee (not to be confused with
the mixed commission) to monitor cooperation and trade. The
agreement expires on 31 December 1974 in keeping with EEC
rules.
27. The West German government has'insisted that the
role of the mixed commission be limited to providing a forum
for private negotiations, and insisted that ultimately all
agreements could only be made by private West German firms.
The commission, in any event, came up with a ten-year economic,
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industrial, and technical cooperation agreement in time for
the May 1973 summit meeting between Brandt and Brezhnev.
It is quite general. Both governments pledge to support
long-term cooperation, and potential areas of cooperation
are listed, but implementation of specific projects will
require consent of west German private concerns. The two
countries have, in fact, concluded several large-scale
cooperation projects, including two gas-for-pipe deals,out-
side the framework of a bilateral agreement. Major West
German participation in a large steel plant in Kursk is
also anticipated.
Austria
28. Since 1955, when four-power occupation ended,Soviet-
Austrian trade has grown steadily if unspectacularly. Long-,
term trade agreements have been a feature of this trade since
1957, as was the bilateral clearing arrangement (until 1971)
which enabled the USSR to incur deficits without hard cur-
rency outlayo. Even so Soviet-Austrian trade is small --
about $100 million in ea.h direction.
29. In May 1968 a framework agreement for cooperation
in the economic, scientific, and technical fields was con-
cluded and a mixed comanission was formed. The majority of
the work of the mixed commission and subordinate working
groups has been to explore possibii.ities for Austrian
cooperation in the development of Sc.viet industry and re-
sources. The highlight of Soviet-Austrian cooperation thus
far was the June 1968 contract for the long-tern supply of
Soviet gas in return for Austrian large-diameter pipe. The
commission claims it is active in promoting cooperation in
various industries, e.g., machine building and the chemical
industry.
30. The Soviets have also used the mixed commission
to stress the importance of increased trade in machinery and
equipment, especially expanded Soviet machinery exports to
Austria. Since its inception the commission has recommended
that a new trade agreement be formalized. As a result, a
five-year trade agreement was signed in 1970. The fifth
meeting of the mixed commission held in early 1973 also pro-
duced a 10-year agreement on the development of economic,
scientific, and technical cooperation. The agreement -- signed
in July 1973 --- spells out some of the industries and other
fields for increased cooperation.
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Benelux
31. Formal Soviet cooperation agreements with the
Benelux nations began with the 1969 signings of two separate
agreements. In that year the Soviets concluded a memorandum
with the Central Chamber for Promoting Trade of the Nether-
lands which covered scientific and technical cooperation.
A more inclusive framework agree lent was signed with Belgium9/
in the same year which calls for government facilitation of
scientific technical, and economic cooperation and the
creation of a mixed commission.
32. In 1971 1-''le Soviet-Dutch cooperation effort was
further expanded by the signing of a framework agreement
covering scientific, economic, and technical fields. The
Soviets, while pressing for the agreement, were accommodating
to Dutch demands that the language of the agreement be
couched in generalities. It provides for the establishment
of a mixed commission to delineate, the potential areas of
cooperation.
33. The USSR has also continued to further define and
expand cooperation with Belgium. Operating through the mixed
commission set up in 1969, the two nations drafted a ten-
year economic cooperation agreement this year. The two
governments have agreed to it in principle, but have as yet
to work out the details.
34. In 1971 the USSR's economic relationship with
Benelux was advanced with the signing of a four-year trade
agreement. This accord marked the initial Soviet recogni-
tion of the union. Trade with Belgium had been increasing
even prior to the agreement, with Soviet exports reaching
more than $130 million in 1972 (up from $83 million in 1969),
but imports changing little at about $80 million. Soviet-
Dutch trade has remained at roughly the same level in recent
years, with Soviet exports approximating $175 million
annually -- about double the value of imports. The con-
clusion of the trade agreement apparently. has had little
effect on trade, but there has been sore movement in
scientific and technical exchanges.
The agreement was concluded with the Belgium-Luxemburg
Economic Union (BLEU).
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Scandinavian Countries
35. Soviet economic relations with Sweden have a
history about as long as Soviet-British trade and in. *:he
Carly post-World War II period Sweden was .lone among
Western nations to extend long-term credit to the USSR.
Soviet-Swedish trade has not been especially dynamic,
however, and Swedish exports to the USSR have fallen to
below $100 million in 1972 while imports from the USSR
have grown to more than $130 million. Soviet-Swedish
trade has been conducted under long-term trade agreements
since the late 1950s, and the latest five-year agreement
concluded in 1970 was for the period 1971-75.
36. The impetus for Soviet-Swedish industrial and
commercial cooperation came from Sweden's private sector,
which in 1.968 established a committee to promote trade and
c(:c-)peration with the USSR. The Soviets formed a similar
cocntu? ttee early the following year, and later in 1969 the
two t~.,-,mmittees met and agreed to draft a broad cooperative
agreement covering scientific, technical, and economic
fields. As a result, an, intergovernmental framework agree-
ment was formalized and signed in 1970. A mixed, commission
was established to implement the accord ane promote --
through the use of working groups -- various types of
cooperation.
37. As wit,`. Sweden, Soviet-Norwegian trade relations
were formalized under an agreement in the 1920s. Trade
between the two countries has always been relatively small,
however, with two-way trade approximately $50 million in
recent years. The 1971-1975 trade agreement apparently
cleared the way for negotiations on possible Soviet-
Norwegian cooperation. The Soviet proposed such an agree-
ment at the December 1971 signing of the trade agreement,
and in mid--1972 the two nations signed a framework agree-
ment covering cooperation in the scientific, technical,
industrial, and economic fields. The open-ended agreement
will be implemented through a mixed-commission.
38. Soviet trade with Denmark is roughly of the same
magnitude as that of Norway. Formal trade relations trace
back to 1946. The latest long-term trade agreement was con-
cluded in 7.969 and covers the years 1970 to 1975. An inter-
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governmental commission -- apparently created in mid-1970 --
set up an agreement of cooperation between the Soviet Chamber
of Commerce and Danish firms as well as a framework agree-
ment: on economic, scientific, and technical cooperation
between the two governments.
39. Soviet-Canadian trade has been conducted since
1956 under a trade agreement concluded that year and re-
newed periodically since that time. Soviet exports have
been relatively insignificant but Soviet imports of Canadian
grain have been substantial, exceeding $300 million in 1966
and 1972. In 1971, the two nations signed a five-year
agreement coveting "Cooperation In Industrial Application of
Science and Technology." The agreement resembles framework
agreements concluded with other Western countries and
includes economic cooperation. A mixed commission was
formed to implement the agreement, and working groups have
been established to examine the potential for cooperation
in several areas. While the commission has stated that
Soviet-Canadian trade is far below potential levels and
that trade could be increased through cooperation, to date
most of the commission's actual progress has been in
identifying potential projects and in increasing commercial
c~nt:acts between Canadian businessmen and Soviet trade
officia3,s.
Switzerland
40. The level of Soviet trade with Switzerland has
traditionally been rel~tively small, with Soviet imports
exceeding $100 million for the first time in 1972. Soviet
exports are about one-third the value of imports. There
is no formal trade agreement because the Swiss have not
wanted one. In 1970, however, two Swiss chemical firms
and the Swiss Watch Association concluded cooperation agree-
ments with the Soviets. Early this year the two countries
exchanged notes, agreeing to establish a mixed commission
on scientific, technical., and economic cooperation, but no
framework agreement was concluded.
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Finland
41. Because of the special Soviet-Finnish relation-
ship, economic relations between the two countries have been
close and have been formalized by a series of agreements,
beginning with a commercial treaty concluded in,1947.
42. In 1955 Finland became the first Western nation
to conclude a broad cooperative agreement with the USSR.
In 1967, the two countries formed a permanent intergovern-
mental commission for economic cooperation replacing the
commission formed in 1955. The new commission has concen-
trated on expanding cooperation on long-term and other
major development projects. Working groups were established
in several areas and a broad cooperation accord was drafted
in 1971. The document is a treatylO/ rather than an agree-
ment and will run an initial period of 10 years, followed
by 5-year renewal periods. The treaty calls for the develop-
ment of cooperation in virtually every phase of economic
life. This all-encompassing agreement probably would not
have been agreed to by Fir.iand were it not for its sub-
ordinate status in the bilateral relationship. Several
cooperative ventures have been finalized under the auspices
of the new mixed commission, including a natural gas-for-
pipe deal, the construction of a nuclear power plant in
Finland, the joint-development of Soviet timber resources,
and a host of other ventures.
43. Project agreements concluded in recent years will
probably provide some stimulus to trade, which has been
lagging in recent years. Until the mid-60s Finland was
the USSR's most important trade partner, but it now ranks
behind several other Western countries. Exports and imports
are about $350 million each. Long-term trade agreements
are concluded every 5 years. The 12th meeting of the mixed
commission in November 1972, in drafting a long-term
cooperation program, called for a trade agreement to be
concluded for the period 1976-1980.
Japan
44. The Japanese private sector -- operating through
a 'apanese-Soviet Economic Committee, with participation by
10. Regarded by the Soviets as more formal than an agreement,
no doubt to indicate the special nature of Soviet-Finnish
economic relations.
C i`Y i' I Li i''j AM L
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the Japanese Federation of Economic Organizations (Keidanren)
-- has played an active role in promoting industrial coop-
eration with the USSR. Since the formation of the committee
and its Soviet counterpart in 1966, three major cooperative
agreements have been concluded: the joint development of
the Vrangel Bay port, the exchange of wood processing facil-
ities for wood chips, and the delivery of timber harvesting
equipment in exchange for wood and wood products. The
potential for Soviet-Japanese industrial cooperation seems
particularly fruitful, given the complementarity of the
highly industrialized and resource-poor Japanese economy
and the rich but underdeveloped Siberian resources. The
Japanese government, however, has taken a hands-off attitude
toward a broad cooperation agreement with the USSR. As a
result, Soviet-Japanese cooperation has been conducted solely
by the Japanese private sector.
45. Until 1973 scientific-technical exchanges also
have taken place without formal government support. In 1967
the USSR concluded an agreement on scientific and technological
exchanges with the Japan-USSR-East Europe Trade Association,
calling largely for scientific exchanges, delegations, etc.
Most transfers of technology, however, l'.ave probably come
as a result of science and technology agreements'the USSR
has concluded with Japanese firms such as Mitsubishi, Itch,
Sumitomo, and others. In October 1973 the USSR and Japan
concluded a two-year scientific and technical agreement
which calls for exchanges and joint research in certain
fields. A joint commission has been formed to monitor
the agreement.
46. The Japanese government has not shown any interest
to date Li concluding a broad intergovernmental agreement
with the soviets which would require it to play an uncharac-
teristic role of trying to influence private industry to
cooperate with the Soviets. For the time being, at least,
government-to-government economic agreements will be confined
to long-term trade agreements. The last agreement (1971-75)
calls for substantially increased trade. Currently two-
way trade is about $1 billion and is growing.
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C01N` b:"NDIAL
 Approved For Release 2006/09/26: CIA-RDP85T00875R001900010MIENDIX A
Soviet Agreements Concluded with the West
Trade
Nation Agreement*
Austria
1970
Australia
1973
Belgium-
Dixemburg -
1971
Canada
1970
Denmark
1970
Mixed
Economic
Scientific-
Technical
Cooperation
Commission
Agreement
1968
1968
1973
1973
1969
1969
1971
1971
1971
1970
Remarks
The 1973 cooperation agreement
covers a ten-year period and
mentioned the potential for
coop-ration in specific areas.
The 1973 trade agreement stressed
the joint desire for economic
cooperation and created a mixed
commission.
The 1971 trade agreement was
signed with the entire Benelux
group. -
A tentative agree:, ent has been
reached for a ten-year cooperation
_
agreement.
The 1971 cooperation agreement is
limited in scope and covers a
five-year period.
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Soviet Agreements Concluded with the West
Nation
Trade
Agreement*
Mixed
Commission
Economic
Scientific-
Technical
Cooperation
Agreement
Finland
1971
1955
1955
1966
1971
France
1969
1966
1966
1971
1973
Italy
1970
1966
1966
Japan
1970
1966
1973
1973
A second mixed commission was
created in 1966 to expedite
economic cooperation in major
development projects.
The 1.971 cooperation agreement
took the form of a definitive trea
The 1966 cooperation agreement
stressed scientific and technical
exchange, while the latter two
are directed towards increasing
economic cooperation.
A ten-year economic cooperation
agreement was initialed earlier
this year.
The 1966 mixed commission was
founded b the Japanese private
sector without any Japanese.
government involvement. The
1973 cooperation agreement,
which created a mixed commission,
concentrates on scientific-
technical exchange and will be
in force for two years.
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Soviet Agreements Concluded with the West
Nation
Trade
Agreement*
Mixed
Commission
Economic
Scientific-
Technical
Cooperation
Agreement
1971
Norway
1971
1972
1972
Sweden
1970
Switzerland
1973
United Kingdom
1969
1968
1968
1970
United States
--
1972
--
Remarks
The 1971 trade agreement was
signed with the entire Benelux,
community.
The mixed commission was formed
through an exchange of notes by
the respective governments.
The 1969 trade agreement mentions
the mutual desire to expand econom:
cooperation, and in 1970 a mixed
commission was created to explore
this field. Negotiations on a
ten-year cooperation agreement
have begun.
The USSR proposed a ten-year
cooperation agreement in
October 1973.
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Soviet Agreements Concluded with the West
Economic
Scientific-
Technical
Trade Mixed Cooperation
Nation Agreement* Commission Agreement
Remarks
West Germany 1972 1971 1973 A second mixed commission was
1972 formed in 1972 as part of the-
1972 trade and economic cooperatio
agreement. The 1973 cooperation
agreement covers a ten-year
period.
The last.trade agreement to be concluded.
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Agreement Between thci Government of the Federal Republic
of Germany and the Govern:i;ent of the USSR Concerning the
Development of Economic, Industrial and Technical Cooperation
The Government of the Fedcral Republic of Germany and
the Government of the USSR
Wishing to decne:l economic, industrial. and technical
cooperation in accordance with the agreement of August 12,
1970, between the Federal Republic of Germany and the Union
of the Socialist Soviet Republics.
With reference to the agreement concerning general
questions of trade and shipping between the Federal Republic
of Germany and the Union of the Socialist Soviet Republics
of April 25, 1958, acid with reference to the long-term agree-
ment between the government of the Federal Republic of
Germany and the govern;: ent of the Union of the Socialist
3oviot Republics concerning trade and economic cooperation
of July 5, 1972.
In the endeavor to promote the development of cooper-
ation in Europe.
In the knowledge that it is useful to secure and expand
cooperation through long-term agreements are agreed as
follows:
Article 1
The parties to this agreement will strive for the expan-
sion and deepening of the economic, industrial and technical
cooperation between their responsible organizations and
businesses on the basis of mutual benefit and will support
this cooperation in all possible areas.
Article 2
The parties to this agreement will agree in the com-
mission, which is established in Article 7, as to those areas
in which it is desirable to expand the cooperation over the
long-term. In doing so, they will particularly take into
consideration mutual needs and resources with regard to raw
materials, energy, technology, equipment, and consumer goods.
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Article 3
The cooperation within the framework of this agreement,
includes particularly the erection of industrial plants which
correspond to the mutual economic inter_?ests as well as the
extension and modernization of industrial operations; the
cooperation in the production of equipment and other 'products;
the cooperation in the production of raw materials; the ex-,
change of patents, licenses, k.~,ow-how, and technical infor-
mation; the application and improvement of existing tech-
nologies and the development o- new ones, as well as the
exchange of experts for technical services and for training.
Article 4
The parties to this agreement support the conclusion
and execution of (specific) agreements regarding plans for
economic, industrial and technical cooperation. They will
facilitate these arrangements whenever possible.
Article 5
The conditions for the individual plans for economic,
industrial and technical cooperation are to be agreed to by
the respective interested' organizations and businesses on
both sides in harmony with the laws and ordinances which are
valid in each of the two states.
Article 6
The parties to this agreement will support the coope-
ration of their responsible organizations and businesses
in third countries.
Article 7
The Commission of the Federal Republic of Germany and
the Union of the Socialist Soviet Republics for economic and
scientific/technical cooperation is authorized to support
and to monitor the practical execution of this agreement.
It will work out proposals for the long-term prospects of
the development of mutual economic, industrial and technical
cooperation.
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Article 8
Consistent with the four-power agreement of September
3, 1971, this agreement is extended to Berlin (West) in
accordance with established. procedures.
Article 9
This agreement does not affect the bilateral and multi-
lateral treaties and agreements earlier concluded by the
Federal 1epublic of Germany and the Union of the Socialist
Soviet Republics, in this connection, the parties to this
agreement will carry out consultations, at the suggestion
of one treaty party, although these consulation may not
place in question the basic objectives of the agreement.
Article 10
This agreement comes into force on the day of its
.signature and is valid for a period of ten years. The
parties to this agreement will agree to necessary measures
for the further development of economic, industrial and
technical cooperation at the latest six months before the
expiry of this time period.
Done at Bonn on May 19, 1972 in two originals each in
German and Russian, both texts being equally binding.
25X1
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Agreement Between the Government of the USSR and the
Government of France on the Development of Economic, Technical,
and Industrial Cooperation
The Government of the USSR and the Government of Franr:e
Referring to the agreement on mutual trade relations
and on the statute of the USSR trade representation in France
of 3 September 1951 and to the 30 June 1966 agreement on
scientific and technical and economic cooperation and also
to the 26 May 1969 agreement between the USSR and France on
trade and economic cooperation in the period 1970-74.
Noting with satisfaction the successful results of
economic and scientific and technical cooperation between
both countries on the foundation established for this pur-
pose.
Wishing to consolidate the results of this cooperation
and to promote the further development of Soviet-French
relations.
. Realizing that;, with a view of insuring and expanding
in the future the ravorable results of Soviet-French cooper-
ation by elaborating measures for a longer period.
Have agreed to the following:
Article 1
Both governments will in the future also make efforts
aimed at promoting the development and consolidation if
economic and scientific and technical cooperation which is
a factor of progress for both countries.
Article 2
With this aim they have decided to encourage the partici-
pation of the organizations, enterprises and firms of each
country in implementing both the existing 5-year plans and
the forthcoming plans of the other country.
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Article 3
By mutual agreement both governments define the various
fields in which the expansion of cooperation is desirable,
taking into account in particular the requirements and' re-
sources of each of the countries for raw material, equipment.,
and technology determined for a lengthy period.
The fields of motor vehicle and tractor building, machine-
tool building, shipbuilding, electrical po%-,or engineering,
instrument building, computer equipment, communicaf._.ons,
ferrous metallurgy, petroleum refining, gas, coal, and ore
mining, timber processing, chemical and light industries,
water probl?ms and in general all fields which, taking into
account the resources and possibilities of each side, have
prospects for favorable development, will be the object of
particular attention.
Article 4
Both governments will Promote cooperation between
interested organizations and enterprises of both countries
and also the conclusion, in accordance with the legislation
in operation in both countries, of agreements and contracts,
including long-term ones, between the corresponding Soviet
organizations and French individuals and corporate bodies,
in particular to insure the participation of Soviet organi-
zations in the construction of industrial complexes in
France and the cooperation of French industry in the con-
struction of industrial complexes in France and the cooper-
ation of French industry in the construction of industrial
complexes in the USSR and also in modernizing and expanding
light industry enterprises which produce consumer goods.
Both sides will facilitate the conclusion of long-term
contracts, particularly for the delivery of raw materials
which France requires.
Article 5
Both governments have also decided, by coordinating
their activity, to seek opportunities for the use of this
cooperation in third countries.
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Article 6
The organization of the practical a implementation of the
above articles is assigned to the permanently operating
Joint Soviet-French Commission created in accordance with
the 30 June 19GG declaration, which in pursuit of this aim
presents a program for intensifying Soviet-French cooperation
for, a 10-year period.
Article 7
The present agr.nement has been concluded for a 10-year
period, and goes into effect on the day it is signed.
Six months before the above-mentioned period expires
both sides will agree on the measures essential to insure
the further implementation of economic, technical, and
industrial cooperation between the two countries.
Concluded in Paris on 27 October 1971 in two copies
each in Russian and French and both texts having equal force.
25X1
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 Million US
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0
0010051-1
1966
1969
1970
1971
1972
Total Developed
Wont Trade
Exports
1,711
2,230
2,345
2,712
2,003
Imports
1,742
2,495
2,700
2,859
4,095
Turnover
3,453
- 4,725
5,125
5,573
6,970
Austria
Imports E/
71
91
50
190
198
Turnover
119
157
172
191
190
Australia
Exports
1
2
2
2
2
Imports
38
45
67
76
06
Turnover
39
47
69
70
Be
Belgium-
Luxemburg
Exports
67
83
82
109
132
Imports
39
80
66
79
98
Turnover
106
163
148
100
230
Canada
Exports
15
12
8
1.8
23
Imports
346
33
131
151
340
Turnover
361
45
139
169
363
Denmark
Exports
34
29
23
29
30
Imports
22
19
26
24
29
Turnover
56
48
49
53
59
Finland
Exports
257
262
287
359
360
Imports
217
294
303
273
368
Turnover
474
556
590
632
728
France
Exports
130
141
140
216
235
Imports
160
323
319
313
424
Turnover
290
464
459
529
659
Italy
Exporcs
155
23?
212
259
276
Imports
95
317
313
291
285
Turnover
251
548
524
550
561
Japan
Exports.
239
357
379
419
462
Imports
224
2G4
345
396
525
Turnover
463
621
725
815
987
Netherlands
Export
80
173
168
171
187
Imports
39
85
80
70
82
Turnover
119
258
248
249
269
Norway
Exports
23
18
27
47
26
Imports
18
17
25
18
19
Turnover
41
35
52
65
45
Sweden
Exports
71
108
117
123
132
Imports
44
129
144
95
96
Turnover
115
237
261
218
228
Switzerland
Export
16
21
27
40
37
Imports
23
60
78
83
110
Turnover
39
81
105
123
147
United Kingdom
Exports
330
427
465
452
449
Imports
169
24U
248
222
226
Turnover
499
667
713
674
675
United States
Exports.
47
61
64
60
92
Imports
63
117
115
143
558
Turnover
110
177
179
203
650
SNr,t Berman Ex orts 109 229 257 292 322
Approve d or eleas 2006/pi/ t-CIA-ROR85T008YR001 10051 * 710
Turnover 333 579 632 776 1,032
is. Components may not add to the tota s shown because of rounding.
s,....:i.F .,.,.,,,,-rc tond 4mnnrts from the inriicated trAin nrner.