L
10
Colter* Station. Tokm
r, Juno a, 1972
THE BATTALION
New Soviet-U. S. relations may mean great market potential, Jones says
Tbo roccnt rotexation of Sortet-
U.S. rotetions may ha to croated a
taa hold on a tromcndono market
potonHol for U.S. exports in eon-
owner and industrial roods, ac
cording to a resource economist
with the Texas Agricultural Ex
periment Station.
Dr. Loomis L. Jonas,
professor at A*M. said !
relationships, which
Isted before because of ideological
differences, probably eriU bring
about a gradual increase in trade.
He added, however, that much
neva. trade
ave«nt sx-
ipromise ■"d negotiation will readily acceptable on tbs world
needed on both ports before money market," Jones said. "A
i can happen. hard currency, such as the dollar
or the British pound can be used
in international trade. Soft cur
rency can’t.”
Jones said that, at least in the
short run, much trade between
the U.S. end U.S.S.R. may have
to be handled on credit, or barter.
“Basically, what they have to
offer in trade are raw materials,’’
he added. ‘Their manufactured
products don’t meet the quality
of those exported by other coun-
‘The potential for trade is
there," Jones said. “The Sortet
Union needs our technology as
well as industrial and consumer
(food# ’’
The biggest barrier right now
is Russia's international finance
poaitibn. In order to import more
U.S. products, Russia will hare
to increase her exports.
The Russian ruble la a soft
currency, which means it’s not
tries, such as Japan and Ger
many.”
Jonas, who visited the Soviet
Union in 1970 to observe their
cotton production techniques, said
they have little to offer the Unit
ed States that isn’t produced in
ternally.
They export oil, which may
or may not hare an impact on the
U.8. oil industry. Other exports,
such as cotton and sunflower oil,
would be in direct competition
with U A cotton end soybean oil.
With the limited amount of
trade currency the Soviets may
hare available, Jones said the
trade emphasis would probably
be on grain in the beginning.
"In the past, they bought grain
only to make up deficits in their
own production. Now, they want
to expend their livestock prodoe- ^
lion and quality of livestock. This ^
requires more grain and other
high protein feed."
Jones listed other areas which
may bo affected by increased
trade relations. Texas agricultural
interests could include the food
and feed grains industry, live
stock breeders and exporter* of
processed fruit and vegetables.
Jones said there was one un
derlying factor which may influ
ence trade negotiations with tha
Soviet Union. This is the relation
ship of politics to trade.
"When you deal with state buy
ers, you’re at a disadvantage in
the negotiation because the buy
ers have no competition,” he said.
“In addition, the economic impli
cations of a trad# agreement are
inseparable from the political im
plications. Tfee
the priorities instead of lotting
them be dictated by tha market.
“This Imposes a constant ele
ment of uncertainty In the trade
relations. Tha possibility is al
ways there that they will break
off trade or not honor a contract
If they feel it's politically fmir-
able to do so."
Jones added, however, that this
uncertainty is minimised by the
fact that the Russians need to
trade.
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