Gorbachev Accorded Hero’s Welcome in Spain : Diplomacy: The Soviet leader draws a parallel between the experiences of the two countries. He is expected to leave with $1 billion in credits for purchase of goods.

Soviet President Mikhail S. Gorbachev, making his first trip abroad as Nobel Peace Prize laureate, arrived to great acclaim and fanfare in Spain on Friday and, in a touch of little-noted irony, found himself housed in the palace that the bitterly anti-Soviet dictator Francisco Franco had occupied for almost 40 years.

Most analysts believe that the Soviet president, accompanied by his wife, Raisa, on a four-day visit to Spain and France, is in search of aid for the faltering Soviet economy. He is expected to sign an agreement with Spanish Prime Minister Felipe Gonzalez today granting the Soviet Union $1 billion in commercial credits for the purchase of Spanish goods, mostly foodstuffs.

In a speech to a joint session of the Spanish Congress of Deputies and Senate, however, Gorbachev raised broader and more philosophical issues.

Although many Spaniards insist that the Spanish transition from dictatorship to democracy is too unique to serve as a model for the Soviet Union, Gorbachev cited the Spanish experience in trying to explain what is happening in the Soviet Union.

“Consolidation is a difficult task for any society, especially when it has experienced truly catastrophic shocks in a relatively short historic period,” Gorbachev said. “Spain knows this well. There is much to learn in the way your country overcame the confrontations and antagonisms born in the schism you suffered in the 1930s (civil war).”

Describing the Soviet Union as experiencing “a period of liberalization without precedent” and “a profound international transformation of a multinational country,” the Soviet president said, “I can assure you that we are going to overcome our difficulties.”

Bringing up the Persian Gulf crisis, Gorbachev said that he still favors “trying all possibilities for a political solution.” But he added that “no one should take this search . . . as a sign of weakness or a sign of vacillation in support of the United Nations resolutions” against Iraqi aggression.

Gorbachev is staying in the Pardo Palace outside Madrid. Since the end of the Spanish Civil War in 1939, the dictator Franco, who lived in the palace, had railed against the Soviet Union as an arsenal for the losing Republican side during the war, robber of the gold of Spain, refuge for the Republican enemies of Franco and provocateur for the murder of scores of Spanish priests and nuns.

Former President Ronald Reagan’s early image of the Soviet Union as “the evil empire” was benign compared to the hellish image that the Fascist Franco conjured up. The dictator severed diplomatic relations with the Soviet Union in 1939 and refused to restore them during his lifetime. Spain and the Soviet Union resumed diplomatic relations two years after his death in 1975.

Although some older Spaniards in downtown Madrid on Friday joked that the ghost of Franco was in a whirling fury over the presence of a Soviet leader in his palace and the unfurling of the red flag with hammer and sickle from the balcony over the palace entrance, few Spanish newspaper or television commentators even mentioned the irony. The Pardo Palace has become the official residence for visiting heads of state, and there seemed nothing unusual about Gorbachev’s staying there.

This ho-hum attitude and lack of comment, however, was an obvious reflection of just how much Spain has changed since the death of Franco and just how much the Soviet Union has changed since Gorbachev came to power in 1985.

There is little doubt that Spaniards look on Gorbachev, the first Soviet leader ever to set foot on Spanish soil, as a hero.

Madrid residents crowded narrow streets to applaud him when he stepped out of his limousine to enter government buildings and palaces. Almost every newspaper and magazine published a special section chronicling the life and labors of the Soviet leader.

Spanish government television planned 20 hours of coverage for the visit, which ends Sunday. Television was broadcasting every public event live.

In an interview with Soviet journalists that was telecast on Spanish television, Prime Minister Gonzalez also drew on the Spanish transition in a realistic and rather pessimistic analysis of how difficult it will be for the Soviet Union to surmount its economic problems.

Gonzalez told the Soviet journalists that the Spanish economy under Franco, though heavily protected by the state under the Fascist system, did operate somewhat within a market.

“Despite this and despite the fact the whole world supported Spain politically as a marvel of a country that was transforming itself from a symbol of fascism to a democracy,” Gonzalez went on, “no one invested in Spain for 10 years.”

“You have to depend on yourself,” he told the Soviet journalists. “The only way to get out of your economic difficulties is through work. Eighty-five percent of the wealth of a country is its people.”

In a more wistful note about the relationship between the Spanish and Soviet transitions, Juan Tomas de Salas, editor of Cambio 16, Spain’s leading newsmagazine, said that, while Gorbachev certainly deserved the Nobel Prize for starting a peaceful process for transforming a dictatorship, Spaniards could feel “a certain sadness because our King Juan Carlos I, who both started and completed a similar process in Spain, has not received the Swedish laurel.” But he added: “It will come.”