Brady Criticizes IMF ‘Inertia’ on Soviet Reforms

Treasury Secretary Nicholas F. Brady, leading a delegation of senior U.S. officials on a visit to Moscow, said Tuesday that the International Monetary Fund has let “bureaucratic inertia” slow efforts to reform the Soviet economy.

“The pace is way too slow,” Brady told reporters aboard his plane en route to the Soviet capital.

At the seven-nation economic summit in July, the world’s leading industrial powers offered Soviet President Mikhail S. Gorbachev “associate status” in the fund and the World Bank. In doing so, they assigned the international lending institutions the lead in Western efforts to help the Soviets transform their crippled economy.

The Soviets, meanwhile, are seeking full membership in the two institutions, which would give them access to their lending as well as their technical expertise. The United States has opposed such status.

Brady said the special-associate arrangement has yet to go forward because the IMF and the Soviets are haggling over the initial paperwork.

“I’m a little disappointed in the bureaucratic inertia,” Brady said. “Here we are, two months after the economic summit, and we still haven’t gotten started.”

Referring to the failed Soviet coup that gave reformers control of the country, Brady told reporters: “The most important event in the last hundred years, and here we are, arguing about documents.”

Another senior U.S. official said the IMF was responsible for the hang-up “to a large extent.”

He noted that even as the Soviet economic crisis deepens, the IMF has yet to begin gathering the preliminary information it will need to start figuring out how to move the Soviet Union from a centrally controlled economy to a capitalist system in which market forces are at work.

A high-level IMF team of economists and other experts has been working in the Soviet Union for several weeks; a group from the World Bank is scheduled to arrive later this week. The international institutions do not expect to sign their first technical assistance agreements with the Soviets until next month, however.