U.S.-Soviet Trade Growth Given Boost : Favored Nation Status Denied; Limits Kept on Strategic Goods

Commerce Secretary Malcolm Baldrige said today that the United States supports expanded trade with the Soviet Union but will not remove restraints on exporting strategic goods or extend most-favored-nation status.

Baldrige called on about 600 Americans and Soviets attending the opening day of a U.S.-U.S.S.R. Trade and Economic Council meeting to “maintain a strong sense of realism” about trade between the countries.

The three-day meeting, coming three weeks after the superpower summit in Geneva, has been unofficially dubbed the “business summit.” It was hoped that the meetings would help boost U.S.-Soviet trade out of its five-year slump.

Status Recommendation

Before Baldridge’s speech, council President James Giffen recommended that the United States give the Soviet Union most-favored-nation (MFN) trading status and repeal the 1972 Jackson-Vanik Amendment, which links trade to emigration policies.

But Baldrige said Washington was interested in expanding peaceful, “non-strategic trade that is consistent with existing laws and policies.”

“The United States and the Soviet Union have serious differences,” he said during a dinner speech. “The United States does not extend MFN treatment or official credits to the Soviet Union.

“We have taken some modest, relatively easy steps to improve the trading relationship, but the most important problems remain ahead of us.”

Other Elements Involved

He also told the meeting, attended by about 350 American businessmen, 200 Soviets and 50 invited guests, that “the trade relationship can not move independently of progress in other elements of the bilateral relationship.”

The official news agency Tass said Baldrige met earlier with Soviet Foreign Trade Minister Boris Aristov to exchange views on U.S.-Soviet trade issues, but no details were immediately available.

U.S.-Soviet trade plummeted after the Soviet invasion of Afghanistan. At present, the United States sells $2.6 billion in goods to the Soviet Union--mainly grain--but imports only $600 million.

Giffen told a news conference kicking off the bilateral trade talks that last month’s Geneva summit between President Reagan and Soviet leader Mikhail S. Gorbachev has created a favorable atmosphere for improving economic ties with the Soviet Union.

“We are seeing a change in attitude in Congress. We have used the stick long enough. It is time for the carrot,” he said.