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several Western countries, including Denmark, France, Norway, Sweden, the United Kingdom, and West Germany. These arrangements call for the furthering of economic and scientific-technological cooperation and industrial co-production; the establishment of mixed government commissions; annual protocols to the trade agreements governing the exchange of goods; and stipulations as to means of payment and general pricing policies. In addition, trade agreements with GATT members include the provision that the Western partners will reduce or abolish restrictions on their imports from Poland and that both parties will grant each other most-favored-nation treatment. The mixed government commissions meet once or twice a year to negotiate annual trade protocols and to evaluate and promote trade and economic cooperation.

Trade with the West has provided about one-fifth of Poland's machinery imports, nearly one-third of its metallurgical industry imports, over one-half of its chemical industry imports, two-fifths of its light industry imports (including about two-thirds of cotton imports and nine-tenths of wool imports), and about three-fifths of its imports of agricultural products, primarily grain (Figure 25). Imports of grain have been financed in part by credits, including (through 1964) P.L. 480 loans.

Poland's ability to export to the West is presently limited to raw materials and agricultural products; coal, wood, and agricultural products together account for about three-fourths of the hard currency earnings. The country has had very little success in boosting machinery and equipment exports to areas other than Communist or developing countries since 1960, despite the fact that this has been an important economic objective. In 1971, machinery and equipment made up less than 10% of Poland's total exports to the advanced market economies. Other industrial goods, generally comprising the cheapest and least complex items in all lines of manufacturing, are for the most part salable only at low prices and in limited quantity. Poland's future ability to substantially increase the volume of high-priced manufactured goods exported to the West is doubtful without a major industrial overhaul, especially in the machine building and iron and steel industries.

b. Plans

Recognizing the importance of advanced technology both to the domestic economy and for increasing its competitiveness in the sale of manufactures to Western markets. Poland plans a huge increase in purchases of capital equipment from the West. The

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APPROVED FOR RELEASE: 2009/06/16: CIA-RDP01-00707R000200070030-5