Regional Outlook : Soviets, Germans: All Quiet on East Front : Europe’s largest country and its richest are trying to bury 50 years of strife. Their relations will affect the Continent.

The German chancellor called it a special responsibility of his generation.

The Soviet president described it simply as realpolitik.

Whatever the description, those who crowded into the stuffy little auditorium in the northern Caucasus spa town of Zheleznovodsk on July 16 and heard Chancellor Helmut Kohl and President Mikhail S. Gorbachev report on results of their two-day meeting knew they had witnessed history.

The Soviet Union and Germany--Europe’s biggest power and its richest--had with chilling suddenness buried half a century of bitter differences that had dragged them through Europe’s bloodiest war and estranged them during a prolonged, uneasy peace.

From a thinly disguised fear of German revanchism, Moscow had embraced the inevitability of German reunification as a cornerstone of “the new political order” that Gorbachev is counting on so heavily.

In the process, the door has opened to a new and hugely important relationship--as rich in potential as it is loaded with uncertainty.

“We stem from different parts of global civilization, but we feel that we belong together,” Gorbachev explained to those listening in Zheleznovodsk.

Anyone witnessing the champagne and euphoria that filled the chancellor’s aircraft as it winged its way home from the Caucasus last July would be left with little doubt that Kohl believed the same.

How these two nations manage this new beginning will do much to influence the future shape of a continent in the midst of greater change that at any time in nearly two centuries.

If it succeeds, analysts believe that the new relationship could become the key element in overcoming the economic and political differences of Europe’s long East-West division. Failure would likely deepen them further.

“Germany is a huge force in the center of Europe,” Soviet Foreign Minister Eduard A. Shevardnadze told the Supreme Soviet last month. “The future of Europe largely depends on how we relate to this giant.”

History and the weight of numbers alone make Shevardnadze’s assessment hard to reject.

Including the Soviet Union’s Asian mass, the two nations account for half of Europe’s population and nearly half of its total production. Together, they have a land area twice that of Europe alone.

Later this month, Gorbachev is expected to make his first trip to the newly united Germany and sign a 20-year Soviet-German treaty of “good-neighborliness, partnership and cooperation” that will act as a framework for the new ties.

Rich and warm in its language, the treaty symbolizes the historical watershed.

“With this treaty there will be a partnership, and that is fundamentally new,” said Valentin M. Falin, secretary of the Soviet Communist Party Central Committee and Gorbachev’s principal adviser on German policy. “And we will be serious partners, economically and politically.”

Added another foreign policy specialist at the Central Committee: “We decided on friendship. Now we are waiting, rather expectantly, to see what that friendship brings.”

So are many others.

The direction and intensity of this new German-Soviet relationship remains one of the biggest question marks in a fast-changing European order--its future as uncertain as that of the Soviet Union itself.

Certainly, great potential is there.

As the Soviet empire lurches from crisis to crisis, it is the economically strong, politically resurgent Germany that seems to have the most of what Moscow so desperately needs if it is to survive as a stable nation.

With a trade volume of $34 billion last year, Germany is already the Soviets’ largest trading partner.

In a new political climate, German deutsche marks, not Soviet missiles, have become more immediately relevant to the preservation of Moscow’s empire.

So far this year, Germany has pledged more than 20 billion marks (about $13 billion) to the Soviets in one form or another.

German loans last summer--among them a $3-billion bank credit that constituted the single largest transaction of its kind ever extended to the Soviet Union--were essential in ensuring the smooth flow of imports necessary to keep key sectors of the Soviet economy from total collapse.

Given domestic political uncertainties in the Soviet Union, little time has been spent trying to assess the long-range potential of Soviet-German trade. However, Heinrich Machowski, an analyst at the German Economic Institute in Berlin, speculates that overall Soviet trade potential could eventually triple, with Germany getting more than its share of the increase.

Bonn and Moscow now also share more common political goals than any other two nations across Europe’s old East-West divide.

A stable Soviet Union, well integrated into Europe, is accepted along the Rhine as essential for Germany’s own prosperity.

Noting the 600,000 Soviet military and civilian personnel still remaining in eastern Germany and the growing emigration pressures among the 2-million-strong German minority in the Soviet Union, a senior Foreign Ministry official in Bonn said: “We have a vested, almost material interest in what happens in the Soviet Union. If there are problems there, we’d feel it physically.”

Moscow has already benefitted from these shared interests.

Both Kohl and German Foreign Minister Hans-Dietrich Genscher were key figures in breaking down American resistance to institutionalizing the 35-nation Conference on Security and Cooperation in Europe--the only platform in which all Europeans, including the Soviet Union, plus the United States and Canada are represented.

The decision eased Moscow’s worries of being shut out of a new Europe.

“When the Germans speak of Europe, they include the Soviet Union as part of it,” Genscher said.

Kohl was also instrumental in winning a European Community commitment to provide financial help for the Soviet reforms and in pushing through softer language on Western alliance nuclear doctrine that makes nuclear arms “weapons of last resort.”

“There’s more interest in Germany than in any other Atlantic Alliance country to integrate the Soviet Union into the European order and stabilize its 15 republics,” summed up Fred Oldenburg, an analyst at Germany’s Federal Institute of East European and International Affairs in Cologne. “That is a fact now and will be for the next five to 10 years.”

Aside from new political imperatives, personal chemistry between German and Soviet leaders has helped accelerate the pace of change.

Kohl has recovered from his initial blunder of comparing Gorbachev to Nazi propaganda minister Joseph Goebbels and has now established what one aide calls a “strong and very positive” relationship with the Soviet leader.

During their historic talks in July, Kohl became the first Western leader invited to Gorbachev’s home region of Stavropol.

About two-dozen Genscher-Shevardnadze meetings so far this year have also built a mutual respect among the two foreign ministers that goes beyond professional duty.

Genscher’s gesture last June of placing a wreath at the grave of Schevardnadze’s 21-year-old brother, Akaki, killed in the Soviet city of Brest during the first hours of Nazi Germany’s 1941 invasion the Soviet Union, is seen as a measure of this respect.

However, despite the infusion of goodwill and intensity of mutual interest, hard realities and age-old suspicions seem bound to limit relations between Europe’s two giants.

The Germany of the Iron Chancellor Otto von Bismarck that wove the Three Emperors’ Alliance together with Russia and Austria, or the post-World War I Germany, whose overtures to Moscow ended their mutual isolation with the 1922 Treaty of Rapallo, are more than outweighed by the deceptions, intrigues and the blood of two world wars.

For both Russians and Germans, it is a love-hate relationship of near-total cultural opposites, in which the overriding emotion tends to be a mixture of fascination and fear.

“This country basically is afraid of Russia, but at the same time is attracted by its culture, its soul,” noted Michael Stuermer, director of the Ebenhausen Institute near Munich, a government-funded foreign policy think tank. “This fundamental ambiguity goes back for centuries.”

Russian children at play rarely fight the Americans or Chinese in their make-believe conflicts. The enemy is invariably German.

There are other problems, too.

The seemingly near-perfect fit of Soviet and German economic interests is overshadowed by some compelling realities.

The mounting chaos in the Soviet Union makes Moscow an increasingly uncertain, confused trading partner with shifting needs, declining incomes, slumping oil production and a sharply rising hard-currency debt that combine to cast doubts on its ability to pay.

At the same time, German economic strength has been sapped by the staggering costs of restructuring the country’s eastern region and by the demands of other East European countries such as Hungary, Poland and Czechoslovakia, which also see Germany increasingly as their financial savior.

“We had decided, even two years ago, to look to Germany, but so is everyone else,” lamented a Soviet diplomat.

The supervisory board chairman of the Deutsche Bank, Wilhelm Christians, may visit the old East Prussian port of Koenigsberg--now renamed Kaliningrad and part of the Russian Federation--and talk grandly about turning the military port into the Soviets’ first international free-trade zone. But as he does, longstanding Soviet-German contracts are unraveling.

Soviet exports to what was East Germany dropped 19% during the first half of 1990, while East German exports dropped 4% during the same period as major change gripped both economies.

Kersten Oschmann, a Soviet specialist at the German government-sponsored East European Trade Committee, noted in an interview that in the Ukraine alone, about 120 longstanding links between German suppliers and Soviet customers have either lapsed or are in danger of lapsing despite efforts to revive them in the short term.

Overall trade is expected to decline before it grows again.

Politically, the new German-Soviet ties are also limited, as much by other relationships as by the suspicions and fears of a troubled past.

Although Moscow has begun to retreat from the global engagements of a superpower, its links with the United States remain the priority, at least as long as it holds broader responsibilities.

For Germany, it is only Bonn’s firm anchor in the West--in the Atlantic Alliance and the European Community--that enables its leaders to lobby so effectively among its allies for Soviet interests.

The nature of unification, a de facto West German takeover of the East, with the old West German leadership now ruling the reunited country with a few token former eastern Cabinet ministers, has eased traditional worries about any eastward German drift.

The open, affluent Germany of 1990 about to sign a major treaty with Moscow is a far cry from the demoralized, outcast Germany of 1922 whose Rapallo treaty with the Soviet Union was seen as a conspiracy against the West by two powerful, but maverick, nations.

German diplomats are also careful to note that, despite the reconciliation, distance between Bonn and Moscow remains.

“There is a fine difference between what we’re doing with our Western partners and what we’re doing with the Soviet Union,” explained one senior German diplomat. “We have friendship with (a country like) France, where there are shared democratic, cultural values. We want friendly relations with the Soviet Union.

“Soviets who talk freely admit that we are starting here, now, what we began with France 30 years ago,” the diplomat added.

There is also a series of potentially explosive trouble spots in the new relationship, including the continued Soviet troop presence in eastern Germany.

Many analysts see the way in which these forces are withdrawn as a first major test of the new relationship.

It is likely to be a sensitive task as morale sags among the low-paid, poorly treated Soviet troops and tempers shorten among eastern German residents now free to say what they really feel about their uninvited guests.

Some commentators believe the inevitable friction can only fuel dangerous nationalistic emotions on both sides.

“It’s going to demand a high degree of sensitivity and understanding . . . ,” Genscher warned the German Parliament.

O Added Machowski, the senior economist and Soviet analyst at the German Economic Institute here: “If it’s done well, it can be a kind of confidence-building measure.”

Other issues, including treatment of the so-called Volga German minority in the Soviet Union, revelations of Stalinist atrocities in Germany during the early postwar years, and demands for compensation from Soviets used as slave labor in Nazi factories, all are potential flash points.

Falin warned that claims for compensation could slow the upcoming Supreme Soviet’s ratification of the treaty ending Moscow’s World War II occupation rights in Germany.

Whatever its eventual fate, few doubt that the success or failure of the new German-Soviet relationship will be pivotal in shaping the Continent’s future.

Many familiar with both countries agree with Falin’s assessment that the new Soviet-German relationship “will likely be a central element of European developments, a central aspect of international affairs in the 21st Century . . . just as it was, very unfortunately, in the experience of the 20th Century.”

Parks reported from Moscow and Marshall reported from Bonn.

Forging a New Relationship

What the Soviets are getting from Germany:

* More than $13 billion in direct financial help, including trade credits and grants.

* A powerful voice in key Western institutions for additional multilateral assistance.

* A friendly, influential power working to prevent any attempt to isolate Moscow from the European mainstream.

* A possible intermediary as Moscow seeks new links with other international organizations such as the International Monetary Fund, World Bank and General Agreement on Tariffs and Trade. What the Germans are getting from the Soviet Union:

* Unconditional approval for reunification on German terms.

* The prospect of genuine security in the east.

* The potential of a lucrative economic relationship that seems a perfect fit--precision German industrial goods for a backward Soviet economy; Soviet oil and other raw materials for a Germany with no such natural wealth.