Soviets Gain IMF Status; Expert Advice Promised : Global economy: Specialists will begin a program of technical assistance to help market forces take over.

The Soviet Union became an associate member of the International Monetary Fund on Saturday amid promises that the organization will get some of the world’s best economists to help establish a free-market economy here.

Michel Camdessus, the fund’s managing director, said IMF specialists will immediately begin an extensive program of technical assistance to advise the Soviet Union on moving from a state-owned, government-run economy toward one based on the market forces of supply and demand and private enterprise.

“This will not create miracles overnight,” Camdessus said of the planned transition. “The transformation of such an immense economy will require much effort and perseverance.”

But the agreement was nonetheless a major step toward the integration of the Soviet Union into the world economy, ending years of go-it-alone policies of socialist self-reliance and using the rigors of international competition to force efficiency in its declining industry and agriculture.

The agreement also reflects the strengthening commitment of the leading industrial nations, including the United States, Japan, Germany and other members of the European Community, to assist in the overhaul of the Soviet economy, providing aid to ensure radical reforms.

Camdessus, speaking after a meeting with President Mikhail S. Gorbachev, said that he was convinced that the Soviet leadership was determined to press ahead with fundamental reforms and at the same time stabilize its economy, where inflation is running at roughly 300% and the banks are running out of money.

“This transformation is indispensable for this country and, at the same time, essential for the world,” he said, reflecting on the dangers posed by the economic collapse of a superpower.

“Such a level of inflation is a deadly cancer, not only for the economy but the society of this country,” Camdessus added. “Our job is to assist countries to avoid hyper-inflation and to combat it with the greatest energy.”

The transition of the socialist economies of Eastern Europe showed, Camdessus continued, that the pace of change can be quite rapid.

“The process will be painful, and dislocations will take place,” he said. “But simultaneously there will be a formidable mushrooming of initiatives to create enterprises according to the resources and perspectives opened by a market economy.

“Unemployment, for example, will appear, but it will be the hidden unemployment from the past. People in state enterprises with no real production will need retraining, but private enterprises will appear in the market to hire them. And there will be a need for a social safety net.”

The agreement signed Saturday will also start the preparations, often long and complex, for the full membership of the Soviet Union in the International Monetary Fund--and the access this would bring to as much as $5.5 billion in IMF credits.

Although Moscow has applied for full membership, Soviet economists agree with Western specialists that simply preparing the statistical material on which to negotiate the terms of entry will require more than a year.

“We put together this associate status so as not to lose time,” Camdessus told a press conference. “The agreement allows us to immediately extend wide-ranging technical assistance to the government of this country.”

The agreement provides for the same rigorous reviews of the Soviet Union’s economy that IMF specialists carry out in other member countries throughout the world, and this should have the effect of holding Moscow to its proclaimed goal of a mixed economy based on market forces.

The first team of IMF experts will start work here Monday, advising the government on macro-economic policies, tax and banking reforms and the compilation of statistics.

Further teams will arrive later this month and next to discuss welfare programs, government budgeting, foreign exchange controls, accounting systems and other areas where reforms will be critical to the development of a market economy.

The IMF is recruiting the world’s top economists to advise the Soviet government, Camdessus said, and drawing on the resources of the World Bank, the European Community, the United Nations and other international bodies.

The immediate difficulty the IMF will face in attempting to advise the Soviet leadership, he continued, will be in developing reliable statistics that reflect the concepts of a market, rather than a planned economy.

“All the information is in the language of a state economy,” Camdessus said, “and it will have to be translated into forms we are used to handling.”

In the agreement, the Soviet Union pledges to provide all the information, much of it still secret, that IMF members regularly provide the organization.

“This will be difficult at the beginning for a country that has lived in a universe of secrecy affecting all these measures,” Camdessus said, “but they understand they have everything to gain from openness.”

Leaders of the Group of Seven industrial nations had agreed at their summit meeting in London in July to offer the Soviet Union associate status in both the IMF and the World Bank as a way to provide the advice that Moscow, after seven decades of central planning, needs to move to a free-market economy.

“Experience shows that negotiations for membership can be very lengthy,” Camdessus said. “This is not for political reasons but the need to establish, as objectively and fairly as possible, the rights of an incoming member to our capital.”

There is a further question in the case of the Soviet Union, Camdessus continued. “What will the constitution of this country be once it is transformed? The rest of the world, as well as the leaders and citizens of the Soviet Union, will want to know that.”

BACKGROUND

The International Monetary Fund is an organization of about 150 nations that works to establish an efficient system of international payments and trade. It seeks to help members achieve rapid economic growth, a high level of employment and improved standards of living. A specialized agency of the United Nations, the IMF grew out of the Bretton Woods Conference of 1944.