U.S. and Czechoslovakia Agree to Improve Trade

Officials of the United States and Czechoslovakia signed a trade agreement Thursday, the second economic pact negotiated with an Eastern European nation since last year’s political upheaval.

The new accord is one of the steps needed to cut tariffs on Czech products sold in the United States. The document also seeks to foster increased business ties and tourism between the two nations.

U.S. Trade Representative Carla A. Hills participated in the signing ceremony along with Andrej Barcak, the foreign trade minister of Czechoslovakia.

Hills said the congressional legislation needed to put the lower tariffs into place could be completed by early summer.

Last month, the United States and Poland signed a business and investment treaty. That pact did not address the tariff question because Poland had already been awarded the lower tariffs under the “most favored nation” designation.

The United States is also negotiating a trade agreement with the Soviet Union, and Hills said she was optimistic that the pact could be finished in time for the May 30 summit between President Bush and Soviet President Mikhail S. Gorbachev.

Both the Czech and Soviet trade agreements are necessary steps that must be taken for the United States to grant the countries most favored nation trade status. That designation would lower American tariffs to the level charged against most other trading partners.

Tariffs on products from the Soviet Union and Czechoslovakia now run as much as 10 times higher than those on goods from other countries.

The higher tariffs were imposed as part of the Jackson-Vanik trade amendment of 1974, which Congress passed in retaliation for communist restrictions imposed on the free emigration of dissidents.

Before tariffs can be lowered, the trade agreements must be in place and President Bush must certify that both countries permit free emigration.