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

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84B00274R000300150006-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 20, 2016
• Document Release Date: May 17, 2007
• Sequence Number: 6
• Publication Date: January 9, 1983
• Content Type: OPEN SOURCE

Approved For Release 2007/05/17: CIA-RDP84B00274R000300150006-8
LF 03 . ;.ARED NEV YORK TIMES
G$li ,~. 41 - 9 JAI VARY 1983
C.I.A. Says Soviet Can Almost Do Without
By tIERNARD GWERTZMAN
SpedsltoThe$e.YorkTt .es
WASHINGTON, Jan. 8 -The Central
Intelligence Agency, in a study of the
SiA-iet 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 an
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-
tural products, it said, meant primarily
to prevent a decline in meat consump-
tion, cost the Russians tit billion in
1981, or 40 percent of their hard-cur-
rency purchases that year.
But Mr. Rowen said that "despite the
An Ability 'to Remain Viable'
Imports from the West, Mr. Rowen
said, "can play an important role in re-
critical shortages, spurring aM"
lieving Ports
technological progress and generally,
improving Soviet economic peform- I Mr. Rowen said the C.I.A. agreed
ance." But he added that "the ability of with Mr. Proxmire that "confusion sur-
the Soviet economy to remain viable in rounding the Soviet economy abounds."
the absence of imports is much greater "Western observers have tended to
than that of most, possibly all, other in- describe Soviet economic performance
dustrialized economies." as 'poor' or `deteriorating' at a time
"Consequently," he concluded, "the when Soviet defense spending continues
susceptibiity of the Soviet Union to eco- to rise, overall Soviet gross national
nomic leverage tends to be limited." product in real terms continues to in-
The Soviet Union has always put crease and Soviet G.N.P. is second in
great emphasis on self-sufficiency. This size only to that of the United States,"
dates from the earliest days after the he said, noting the apparent contradici-
1917 revolution, when most foreign tons.
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 formance and expectations, and the
World War II. lack of economic efficiency, "the
Mr. Rowen's report was prepared at record compiled by the Soviet economy
the request of Senator William Prox- in recent years has indeed been poor,"
mire, Democrat of Wisconsin. The he said.
Senator, who is vice chairman of the "Results that are unsatisfactory
subcommittee on international trade, when measured by this yardstick, how-
finance and security economics, hid ever, do not mean that the Soviet econ-
asked for "a balanced assessment" of omy is losing its viability as well as its
the strengths and weaknesses of the dynamism," the C.I.A. official said.
Soviet economy. "In fact, we do not consider an eco-
This was the second C.I.A. report in a nomic `collapse' - a sudden and sus-
u
o th t t t tr th
th
e
in n o pom o
s eng m
e
tamed decline in G.N.P. - even a re..
Soviet economy. 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
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.
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 abut 3,300 calories a day, as
against 3,52O'for 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
equipmenu for its oil and natural gas
fields. The Administration has tried to
block those exports in particular,
provoking feuds with Western govern., meets 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
pit 35 percent of the world total. Product
tion in 1981 was estimated at 325 tons
and its stock at about 1,900 tons, worth
over$25 billion at current prices.
1eecono~my was tha ed major
the h
growth
+ of the work force, with only 9 million ex-
petted 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.