Soviets, Former Satellites OK Free Enterprise

The Soviet Union and its former satellites in East Europe agreed here Monday, in a significant signal of shifting economic policies, to embrace the principles of free enterprise, private property and a market economy.

Moscow and the old East Bloc countries endorsed a series of liberal economic principles at the 35-nation European economic conference as a way of encouraging foreign investment and their own private sectors.

The three-week conference was held at the urging of West Germany to shape the West’s dealings with post-Communist economies in Eastern Europe.

The head of the U.S. delegation, businessman Alan Holmer, said he is “very happy” with the draft declaration that is expected to be signed before the conference ends Wednesday.

“The adoption of these principles by all 35 states would have been unheard of 12 months ago,” Holmer told a news conference. “It makes it more likely that current trends towards market economies and towards political pluralism will continue and there will not be any backsliding.

“It sends a clear signal to Western businessmen that Central and Eastern European countries are open for business, based on the market principles that have been agreed here.”

Implicit in the measures adopted by the members of the Conference on Security and Cooperation in Europe, under whose aegis the meeting is taking place, is a commitment to democratic pluralism, officials said.

“The document now agreed (to) acknowledges the relationship between political pluralism and market economies,” said Desmond O’Malley, the Irish minister of commerce, who spoke Monday on behalf of the 12-member European Community.

“We now agree to pursue market principles and have specified how these are to be implemented: through provision of more complete economic and commercial information, through promotion of direct business contacts, through the free flow of trade, capital and investment and by ensuring that market conditions in our countries actually stimulate business enterprise,” he said.

The Soviet Union and the East European countries agreed to an overall statement hardly thinkable a few months ago: that all 35 nations “recognize that democratic institutions and economic freedom foster economic and social progress.”

The draft declaration goes on to say: “Participating states recognize that the performance of market-based economies relies primarily on the freedom of individual enterprise (and) believe that economic freedom for the individual includes the right freely to own, buy, sell and otherwise utilize property.”

There could be last-minute changes in wording, but these would be slight, officials said.