Friends in Need

A Soviet Ilyushin-18 turboprop touched down at Belgrade's military airport last week, rolled to a stop before a neat row of Communist-bloc diplomats that included every resident Red representative except the Albanians. Then the plane door popped open and out stepped Soviet Foreign Minister Andrei A. Gromyko, his usual grouchy expression replaced by an almost friendly smile.

Officially, Gromyko's visit to Yugoslavia was in return for a visit to Moscow last summer by Yugoslav Foreign Minister Koca Popovic. Punctiliously, the government newspaper Politika gave Gromyko's arrival precisely the same space that Izvestia had allotted to Popovic. But there was more to Gromyko's appearance in Belgrade than such formalities indicated. On the government level, Soviet-Yugoslav relations have become steadily warmer, even though party propagandists still practice the name-calling inspired by Tito's 1948 split with Stalin. Khrushchev, faced with the new threat of a more serious break with Red China, has gradually made peace with Tito, who has used his considerable influence among European Communists to urge support for Khrushchev's destalinization policies. Plainly, Gromyko's visit marked the Kremlin's public acknowledgment of Belgrade's valued backing.

Innovations Fail. But if the Soviets need Yugoslavia's political aid, Yugoslavia now badly needs Soviet economic aid. Cut off both from Western Europe's Common Market and Eastern Europe's trade bloc, Comecon, the Yugoslav economy is on the point of collapse. Said one official of the Yugoslav National Bank last week: "We have more than $30 million worth of outstanding bills than we can pay. Our only prayer is that they don't all come in at once."

Last year Belgrade economists made sweeping innovations to decentralize industry, introduce competition by breaking up inefficient state monopolies and giving more control over wages to local factory managers. Though the aim was sensible, the result was chaos.

Communist bureaucrats refused to shut down a single outmoded plant, fearing the ire of unemployed workers. Cumbersome monopolies, which produce goods at inflated cost, lobbied successfully against establishing domestic rivals. Factory managers boosted wages by a staggering 23%, went on a buying spree for foreign machinery for which the National Bank had to shell out scarce hard currency. At the same time, relaxed import barriers flooded Belgrade shops with French cognac, Italian shoes and other fancy consumer goods that the economy could not afford.

Unscheduled Chat. Last week the government finally stepped in, cut back the program for economic liberalization by tightening control over Communist Party planners. A new regulation asserts the right of the state "to interfere" when industry proposes new wage hikes.

The economic crisis gave Visitor Gromyko an opportunity to increase Soviet influence. Early during his visit, Gromyko had brushed off Foreign Minister Popovic's surprising endorsement of the latest U.S. proposals on Berlin ("I am very impressed--seems like the first real chance to solve the German question"). But just before he flew back to Moscow, the Soviet Foreign Minister--not a man who usually talks trade--had an unscheduled chat with Tito's top economist, Mijalko Todorovic, Vice President for economic affairs. Presumably their talk included the possible resumption of Soviet aid to Yugoslavia, suspended in 1958.

Gromyko's chat may have paid off. Said one leading Yugoslav official after Gromyko's departure: "If we had to make formal application either to the Common Market or to Comecon, we would apply for full membership in Comecon, with the full knowledge of all the political and economic meaning of such a move."

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