TRADE: Cutting the List

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The London Times went so far as to call it "a forward outpost of the McCarthyist outlook," and few foreign businessmen thought that the strict U.S.-inspired embargo on "strategic" goods to Communist lands made too much sense. The embargo, they argued, had not noticeably stunted Russia's industrial growth; it tended to make Red China more and more dependent on the Soviet Union, and it deprived Western nations of much-needed markets. Over the years, bit by bit, the U.S. has had to give in to such pressure. Last week, after five months of arguing, the Coordinating Committee (COCOM) of European nations, the U.S., Canada and Japan slashed the number of embargoed items from 181 to 118. It also lifted all controls over the amounts of goods that could be exported to Communist nations.

Though the U.S. will not have its own list ready for at least two months, it promptly made it clear that it would hold to its ban as far as Communist Asia (China, North Korea, North Viet Nam) is concerned. Other nations follow no such double standard for Eastern Europe and Asia. They will now be allowed to export to any country that wants them such newly freed items as civil aircraft (including turboprop), all kinds of trucks, tankers under 18 knots, industrial diamonds, all petroleum refinery equipment, all turbines and diesel engines. But for all their cries that the relaxed embargo was a victory of "common sense," the U.S.'s allies expect no dramatic rise in trade with Communist countries that have shown themselves so guided by political whims, so chronically plagued by a shortage of currency or a lack of goods that meet Western specifications. Though Britain's trade with Communist countries, for example, has more than doubled in the past seven years, it is still only 2.6% of total U.K. exports. In a more realistic vein, the London Times warned: "When the Communists talk about increasing trade, they are as often concerned with the political effect of their words as with any goods they may want to buy." Added a Ruhr industrialist: "The demand for Russian caviar is not unlimited in Germany, and it is not always easy to obtain other goods for which we might have better use."