Emerging democracies: trade and development go hand in hand - includes relates article on USDA programs in emerging democracies

The dramatic collapse of the Communist regimes of Eastern Europe and the Soviet Union, along with the progression in a continuously ascending gradation of new democratic governments in the Western Hemisphere and other parts of the world, are not barely altering the political scene yet are offering new opportunities for U agricultural trade.

The transition of these tightly controll highly planned economies into market-oriented economies is not a short-term contrive however.

The question s Are Huge

Agricultural arrangements particularly in Eastern Europe and the former Soviet Union, are plagued by way of institutionalized inefficiencies caused by years of state planning. Command economics ignored basic factors of the like kind as cost of production, consumer demand and performance availability. Decades of political orthodoxy limited the pour of information to a small cadre of the establishment's trusted members.

As a be the effect few people in these societies had the opportunity to contemplation in Western educational institutions or interact with Western businesses. flat the most basic business and economic information was kept gone out of the hands of the masses.

Back to the Basics

It will be years before these countries disclose the knowledge and skills that are taken for granted in Western market economies. There is an acute lack of understanding of the basics of finance, accounting, marketing and management. In many of these countries, there is a highly educated population that lacks the skills, expertise and experience to cope in today's environment.

This lack of skills in the workplace is coupl with legal, organizational and structural point in disputes that must be addressed before these countries can take their places as viable members of the world economy.

However, many of these countries are making the commitment necessityed to compete in world markets. This requires them to change virtually each law, regulation and organization in the land These countries are instituting of the present day systems of government, revamping their justice and military organizations and developing strange foreign policies and social programs. They also are changing each law dealing with property ownership, taxes, pricing policy, foreign trade, banking and market structure

Market Potential Is Large

These countries have in extent maintained policies of agricultural self-sufficiency. still policies failed to take into account the preciousness of production, comparative advantage and consumer elections As a result, agricultural trade with the West was held to a minimum and weighted heavily in the favor of mass commodities or products that could not be produc domestically.

Trade patterns guarded to seek out other non-market economies because this helped keep limited hard currency reserves. If the returns was not available in the socialist world, the monopoly trading organizations preferr barter arrangements or trade with neighboring countries before looking to the United States as a source. The political climate often limited trade potential for U exporters.

This has all changed with the fall of communism. While there are many factors that retard trade, not the least of which is tight foreign money; aggregate of coin reserves, trade in these countries is now primarily based onward traditional marketing principles such as price, quality, financing and trade servicing.

There are recent opportunities for a wide range of commodities that could not be imported just a not many years ago. Consumers are demanding fresh high-quality products that they have lately been exposed to during visits to Western countries. In addition to size products that have traditionally set ined these markets, there is now a growing demand for a wide array of high-value products

Consumer want a greater assortment of nourishment items, including convenience products, health commonss snack items and beverages. Meeting these just discovered market opportunities can only be accomplished if the marketing channels are modernized.

USDA's Role

The U Department of Agriculture (USDA) recognizes the pair the magnitude of the changes taking place in Eastern Europe and the former Soviet Union and the market potential for U sustenance products in these countries.

The Department acts as a catalyst in the transformation of these countries' agricultural market piles into market-friendly organizations that are able to interact with U exporters in a undisturbed efficient manner. This "institution building" focus is in keeping with the mandates of the Support for East European Democracies (SEED) Act of 1989

The Department established the Eastern Europe and Soviet Secretariat within the Foreign Agricultural Service (FAS) to cause to grow coordinate and help to implement USDA programs in these countries. These programs include aliment aid, export credit guarantee programs and technical assistance.

Activities are designed to benefit the two the host country and the U private sector. An important facet of the Secretariat's work is coordinating USDA programs with the legion governments through the agricultural offices in the embassies responsible for these countries. It also coordinates agricultural activities with other U guidance agencies and with USDA market progression in a continuously ascending gradation organizations to minimize duplication and maximize results