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Regional Outlook : East Europe Looks for EC Sales, Gets Little : The former East Bloc wants to market its textiles, farm products and steel in Western Europe, but the Community's trade barriers are keeping the door closed.


JADOV, Poland — Eugeniusz Powierza, who still uses a horse-drawn plow to cultivate his 47 acres of fertile farmland in central Poland, wonders angrily why he can't export his cattle to Italy. If he knew, he would probably be angrier still.

The reason is a complex set of trade barriers erected by the 12 Western European nations of the European Community against the former Soviet satellites of Eastern Europe. Poland sold its entire 1991 quota of cattle in just the first three months of the year. It can sell no more.

In fact, fumes Powierza, meat from the EC--particularly from what used to be East Germany--is showing up in Polish markets. "The government should stop that," he says. "Meat is being imported when there is plenty of meat already here."

After 45 years of deprivation under their Soviet Communist neighbor to the east, Poland and the rest of Eastern Europe are now looking west for a measure of capitalistic prosperity.

But they are finding instead a Western Europe that is intent on preserving its own wealth. The EC's trade barriers along its eastern frontier cover not only farm products but also textiles and steel--which happen to be the three kinds of goods that Eastern Europe is best positioned to export.

"It is deeply regrettable," said Michel Camdessus, director of the International Monetary Fund, "that so little has been done by the industrial countries to open up their markets to imports from the reforming countries."

Singling out Western Europe as having a special obligation to help its neighbors to the east, Camdessus added: "This reluctance could put in jeopardy the historically momentous process of systemic reforms in Eastern Europe."

To be sure, most Eastern European countries are believed to have run trade surpluses with the EC in 1990; Poland's surplus was nearly $1 billion in the first nine months of the year, for which official figures are available. But Eastern European officials uniformly insist that they could have sold still more if the 12 EC countries had opened up their borders.

The trade issue is paramount in negotiations between the EC and three Eastern European countries--Poland, Czechoslovakia and Hungary--that are seeking some form of associate membership in the Western European economic club.

But negotiations with all three countries--typically, a session of several days each month--have bogged down, and success is far from certain. "Maybe June will be different, but we have a long way to go," said a Polish official who asked not to be identified.

EC officials say Poland--unlike Czechoslovakia and Hungary--has delayed the talks by failing to submit a list of proposed trade levels in farm products.

The talks with Poland have also become complicated by that country's decision, which it is still in the process of implementing, to fight back by imposing tariffs or quotas on Western European products.

"They (the EC countries) can't start liberalizing until Poland finishes 'deliberalizing,' " said a Western diplomatic source. "There's plenty of blame to go around."

Nor is trade the only land mine for the EC and Eastern European.

Among others is the explosive issue of emigration from east to west. Eastern Europeans are already flocking to the more prosperous EC nations, looking for such low-skilled but--by East Europe's standards--lucrative jobs as handymen in Brussels and gardeners in the Dutch tulip fields.

Eastern European leaders are also seeking greater exports to the United States. Hungarian President Arpad Goncz, meeting late last month with President Bush in Washington, complained that several U.S. laws brand Hungary a Communist nation and deny it full access to U.S. markets.

White House Press Secretary Marlin Fitzwater said U.S. officials were visiting Hungary to seek ways to overcome U.S. barriers to Hungarian goods. Expanded trade with Eastern Europe, Fitzwater said, will be high on the agenda of the July summit in London of the seven leading industrial nations.

"This is part of our effort to assure the new democracies of Central and Eastern Europe the widest possible access to U.S. and European markets, which we expect will be a major theme" of the so-called Group of Seven summit, Fitzwater said. Represented at the summit will be not only the biggest four EC nations--Britain, France, Germany and Italy--but also the EC itself. (The other Group of Seven members are Japan, Canada, and the United States.)

For Poland, an opening to the West could not come too soon.

Henryk Staniszewski, production director for Huta Warszawa, a gigantic steel mill on nearly 75 acres of land on the outskirts of Warsaw, listed EC trade barriers among the reasons for a sharp drop in his plant's output.

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