Gorbachev sends Bush, U.S. allies plan for quicker economic reforms

July 12, 1991|By Karen Hosler and Mark Matthews | Karen Hosler and Mark Matthews,Washington Bureau of The Sun

WASHINGTON -- Soviet President Mikhail S. Gorbachev provided President Bush yesterday with an advance look at the economic reform program he plans to unveil at the London summit next week, and initial reactions from U.S. officials were positive.

Neither Mr. Bush nor his top advisers got a chance to review the 23-page document in detail yesterday, but administration officials say preliminary indications are that Mr. Gorbachev will bring to London a blueprint for a speedier move toward a free-market system than he has advocated in the past.

The advance signals are "pretty good," said one official, who described Mr. Gorbachev's plan as drawing more from the sweeping reform proposal offered recently by Russian economist Grigory Yavlinsky than from a less radical approach put forward earlier by Soviet Prime Minister Valentin S. Pavlov.

President Bush and most, if not all, of the six other leaders of the world's major economies scheduled to meet with Mr. Gorbachev next week have said his commitment to a genuine dismantling of the Soviet centralized economy is a prerequisite to their financial help -- although no major aid is expected to be forth coming immediately.

Mr. Gorbachev's plan was delivered to the White House yesterday by Soviet Foreign Minister Alexander A. Bessmertnykh. Mr. Gorbachev had dispatched him to Washington to meet with Secretary of State James A. Baker III to see whether they could iron out the last remaining differences on a treaty to reduce strategic nuclear arms. Little progress was reported in those talks yesterday; they will continue today.

Copies of the economic plan were also sent to the other nations attending next week's economic summit, and Mr. Bush gave one to Japanese Prime Minister Toshiki Kaifu during their talks yesterday at the president's vacation home in Kennebunkport, Maine.

Mr. Bush told reporters at a joint news conference with Mr. Kaifu that he considered it "unlikely" that Mr. Gorbachev's plan would contain all the elements the United States was seeking, which include a major shift away from defense spending to civilian purposes and a largely self-help program based on redistribution of Soviet resources through free markets.

But Mr. Bush and Mr. Kaifu said they were confident that the summit leaders would agree to begin working with the Soviets to provide them technical assistance and expertise in their economic metamorphosis, primarily by providing them access to international financial institutions, including the World Bank and the International Monetary Fund.

Mr. Gorbachev's presentation to the summit partners will follow the formal conclusion of their meeting Wednesday but has long been anticipated to be its highlight.

Earlier expectations that he would seek or be granted a large infusion of direct financial aid were firmly quashed after signals from the United States and other summit partners that such action would be inappropriate at this time.

But there has been much curiousity about what Mr. Gorbachev would have to say to convince the heads of the world's leading industrial democracies that he is serious about instituting what would surely be painful reforms and not just looking for money to prop up his troubled government.

In their news conference, Mr. Bush and Mr. Kaifu acknowledged that they had hadn't reached agreement on trade issues.

But Mr. Bush said they had resolved differences over Japan's contribution for the Persian Gulf war. Mr. Kaifu said the Japanese people would bear a tax increase to make the full payment.

Mr. Bush said he would visit Japan in late November. The White House said he also would go to South Korea and Australia, but no specific dates were announced.

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