Conversation 126-003

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How are you all doing?

Will you put me in place?

How are you?

Good.

Thank you.

I didn't go right.

Well, that's cruel, isn't it?

Yeah, it's not a measure for every day.

I don't know.

I don't.

I have a quick printout.

It would be like one tick to pull it around.

I don't know.

You're hurting me.

I don't know.

So this is where Dr. Chisholm used to stay in town?

Oh, yeah.

Yeah, it's a bit...

It's a bit...

We can do one of this way, gentlemen.

Okay.

As far as I understand, your state and other senators are in foreign affairs.

I emphasize this, because I know this work well.

In my conditions, I will be the chairman of the executive committee.

For more than four and a half years now, all the members of the Supreme Council do not understand what role the deputies and various other committees play.

So far, your commission has been doing its job, and all this has been done to understand how we are going to solve the big political problems in our relationship.

I emphasized this.

Therefore, I thank you for coming here.

With your help, it became possible to visit your country.

What did you contribute to this meeting?

I was invited to the Pride event.

It was a friendship, I would say, such an atmosphere.

Maybe I took your sound with time.

but he stopped his actions on the main projects.

After the meeting of our people, the announcement of the last meeting, the initiative of our justice, he said that our people support the relationship we have with you.

The European Council said that the majority of senators support the president in these issues.

It said that this line is supported, as I understand it, by all American people.

Mr. President, in this regard, and then in the essence of our politics, our relations,

In some way, their request raised the issue of developing trade relations.

In general, it was a good and useful area.

At the end, there was a question about the possibility of joining families.

I would like to repeat myself.

Literally all states,

I have an open mind.

More than two hundred and sixty people.

Do you remember yesterday?

Everyone called out to me.

They expressed their hope that I, including myself, will continue to work here.

I will continue to work here.

You know, there are several important decisions that will probably be made among our people.

This is the common sense.

I spoke about history, freedom, and most importantly, what our parties and our people live on.

I had a very pleasant meeting with some very influential Americans, Senator Fulbright and some other notable Congress senators and congressmen who are members of the Foreign Relations Committee.

I am aware of the great importance of bodies such as the Eid Congress, because in my own country, I was, for more than four and a half years, I myself was president of the Presidium of the Supreme Soviet, and I'm still a member of the Presidium of that body.

So I'm deeply aware of the importance of violence of the Supreme Soviet in our country and our Congress in the United States.

This is particularly true at a time when we are endeavoring to resolve some major questions bearing on our relations.

During, as I addressed them, I expressed my gratitude to you, Mr. President, for all the work you've done to enable this meeting to become reality.

And I thank Senator Fulbright for arranging the, by means, today's meeting with him and his colleagues.

The discussion went on in a very friendly atmosphere.

And I, in my remarks, I worked upon many issues, basic problems in a broad way.

I referred to our relationships in general.

I stressed the importance of last year's meeting.

And I stressed the responsibility that rests upon us.

And also I stressed the fact that

I described, I have a certain fact in our mind, and it's being, in respect of relations between the Soviet Union and the United States, is enjoy the support of our people, and point out that as far as I know, that it was a good thing that the most conservative, simply supporting president,

And he is surely supported by the majority of the American people who express their support for him by voting to keep him in office for a second term.

And then I then turned to the substance of our relationships and spoke about the development of economic ties between our two countries.

And then finally, on their initiative, I said a few words about the so-called question of the departure from the Soviet Union to reunite families and the like.

And what I did was to read out official government statistics on that problem.

Well, generally speaking, my impression is that I was well-received by the senators.

They thanked me for a frank expose of my thinking.

And that's what it is.

In fact, that's what I did.

I put it to them in a very frank and sincere way.

And so I can say, summing up, that I'm satisfied with the way the meeting went, though it was a little tiring.

It was a bit hot on the route, too.

And I spent more than three and a half hours with them.

We all, they all said that yesterday, they thought that yesterday's, the meeting yesterday, the start of the official visit yesterday was a very important event.

And I told them I would still be having further meetings with you, Mr. President, and they look forward to some still more important decisions.

which, as I said, I'm not sure would be welcomed by senators and the American people generally.

And so I'd say that they left a pleasant, they left a very good impression on me.

One of the senators asked me

And he asked whether it's something to the effect whether that amendment could be

beneficial to the development of our relations.

As I told a lot of senators,

Any amendment can have a counter-amendment attached to it.

And one of the senators said, that may be the way things will go.

We'll introduce an amendment to the amendment.

That was just one kind of joking.

Yeah.

Well, I greatly appreciate the time that the General Secretary has spent with the Senators.

And I'm sure that will be helpful.

getting our support for our legislative program.

Stopping such things as the Jackson Amendment and getting them in.

I actually regret that they gave him such a long time.

We hope he gets time to get to bed earlier than I do.

Yeah, of course.

Well, thank you, Mr. President.

You know, I've come over the years, I've come to the conviction that tiredness is always, is something that's always

It couldn't have been easy for you last year to adapt yourself to art to the time difference either.

The only other time that I can recall since I had the presence is that we had visitors at the Cabinet table.

The Prime Minister Wilson was here in our first year.

The subject that the General Secretary and I agreed we should discuss today is one in which there is total agreement with regard to gold.

And the question is, how do we treat this?

The general secretary has often said, he told me last year and this year, that our economic systems are complementary.

And that we should think big and not small with regard to increased economic relations.

And that we should think long term and not short term.

And I certainly reaffirm that, Mr. President, and that is the way I put it to the senators today.

Now, as we know that Secretary Shultz and Mr. Belichick have been discussing these matters,

The problems we have have to do with how we can take an economy like ours, which has many private independent businesses, and work out arrangements for this economy.

dovetail where it serves our mutual interests with an economy like yours, which is basically a government-controlled economy.

I know that Minister Schulz and Minister Patovich discussed these questions.

I think that our main question relates to how we

I asked Governor Connolly to come today.

He's a former member of our cabinet.

But second, he now is in what we call the private sector and is very familiar with the problems of how private companies will have in attempting to make arrangements with the so-called more investment trade.

I have officially invited Mr. Connolly to our meeting today.

He is a former member of the Cabinet, and now he conducts his activities in the so-called private sector.

And he is very familiar with the problems that our private companies will probably face.

I think we can look back over the last year and be pleased with the increase in trade, but also looking for the future.

The possibilities are much greater than we achieved during the last year.

The problem we have, however, is to find ways that the many American companies

who would like to invest in the Soviet Union, or trade with the Soviet Union, ways that they can do so.

And it's here that Secretary Shultz has been working with Richard Tolichan with some success, and I'm sure will clarify another one.

And I think that our main problem is how to find a way, as a result of which many of our American companies, appearing to this great interest, could make capital investments in the Soviet Union and trade in the Soviet Union.

Minister Schulz already discussed these issues with Minister Popovichev with some success.

And I am sure that you can find other

As I told the General Secretary yesterday, the attitude on the government side will be positive where these various questions come up.

And as I told you yesterday, what concerns the position of the American government, it will be absolutely positive regarding all these issues.

And yet, as practical men, we know there are many practical problems to be worked out.

That is true.

I would like to say that it is necessary to say, first of all, that we really have a sphere, an expensive sphere, a sphere of very beneficial cooperation.

We just need to find a form.

As far as the political direction of this issue is concerned, it turned out to be a completely clear, so to speak, program.

It was developed in a broad and positive way at the last meeting of our Central Committee, which was then approved by all our parties.

Here, in the presence of all the members of the Chamber of Commerce,

They are all involved in this program and can confirm that it is a wide program to change the course.

to step back from the old traditions and find new ways for such a broad cooperation on a mutually beneficial, non-discriminatory basis and on a long-term and desirable basis.

I took the opportunity to talk to senators in Moscow because I knew exactly the figure of this.

Approximately for the scale, I said everything.

Let's talk about Asia.

This is not such a question that we necessarily insist, ask, demand.

No.

But this is the kind of seriousness that people now do not only energetically, some resources, but also do miracles, make impressions.

And what do you want to do?

I don't know.

And so I said that the Soviet Union, to our satisfaction, has a huge amount of gas, and of good quality.

I said, well, if the Soviet Union, with its national wealth, offered you 1 trillion cubic meters of gas, and you are already business people, you will work, you will talk, you will consult, how to do it all.

This is no longer my business.

I answered the questions of the government, I looked into the eyes of others.

Here is one more difficult question.

If in America, as it happened to me, the business circles would want 250 billion meters, 20 years, then 1 trillion is about 40 years to operate this pipeline and use 250, about 220 billion meters of water.

That's the question.

The Soviet Union has its own security.

And I would say that I am afraid that I will be all sorts of iron, iron, other prices.

This is the second question.

It is possible to make a useful and long-term agreement in the future, let's say, in our cooperative system.

Well, the question, let's say, of household trade, of all kinds of ready-made goods, of household goods, of course, should be met, but this is not such a big deal.

I think it would be good if the comrades worked in this direction.

Maybe to quickly create a business house and a trade center.

A commercial center.

I will make all efforts to create a commercial center in Moscow.

Let it be faster, let it be a temporary building, and then more comfortable.

Let your people come.

We will.

offer their efforts, help them solve these problems.

Maybe this is the way to do it.

Maybe we need to create some kind of temporary commission.

A group of your people and a group of our people will consider the energy issue.

The second group will consider the cooperation of all and the use of, let's say, some useful, unskilled hands.

Then, we can create a third group using joint enterprises that could have worked on a compensatory basis for 40 years, using the latest research, science and technology, and then for a long time on such a mutually beneficial cooperation.

We can pay for it, of course, from our side, and for 10 years, for which there will be more products.

We can do it for 5 years, it will be even more.

We can do it for 20 years, when there will be half.

But on the one hand, it is already doing the electricity bill.

Therefore, I can't present a specific program right now.

I fully agree with your thoughts.

And if, Comrade Petrovich, we have already managed to come up with something in this area, then we will welcome you.

I have not yet discussed this issue with myself, but I can say that our leadership, the party, the state, has such an approach.

I am welcome, as I told you, very widely throughout our country, in the leading forms of the republics, in all the countries.

So if we are united in our goals, then we really need to think about how best to do it.

We have experience.

It was not an easy decision for you when you went to Moscow with Visita.

It was not an easy problem for you.

And during half a year or a year you worked and found the opportunity to form and lay the foundations of new historical relations.

And today we are continuing them.

Indeed, I agree that this was a joy.

We have already used 70-80% of the credit that you provided us.

This means that we will have to pay you, I don't remember the percentage, but within the next few years, which, of course, will provide significant economic benefits for the company.

So there is already a lot of experience.

Now there are negotiations that were approved at the last meeting before my departure.

This is on the line of aviation.

Then the purchase of the Yak-40 aircraft with the internal armor of your company.

This is also a friend's deal.

But the issue of the production of chemical fertilizers, the issue of the supply of America to the Soviet Union, to the United States.

Very little.

Of course, we cannot compete or argue or find the most effective form of work, let's say, in the field of car design, because this industry is at a higher level.

Or something else.

I can say that if I could freely

I don't know.

Maybe Nikolai Semyonovich can say a few words.

I would like to ask you to agree.

We have things that we could sell each other.

And we certainly have for areas where we could organize equally advantageous cooperation.

The problem is, indeed, to find the adequate forms of such cooperation.

As regards the political trends, we have, in our country,

a very broad and positive program, which has been fully approved by the last Kingly meeting of the Central Committee of our party.

And I'm quite sure that the members of the Central Committee of the party present here, and they include

Ministers Gromyko and Soloshev, Ambassador De Bruyne, and Minister Gugayev, and Mr. Tsikhanov and Alexanderov, they can all confirm that this plan is a very, has been approved.

And I have to add also that we have given instructions to our economic agencies and to the planning bodies to

depart from old traditions, old and outdated traditions, and to make an effort to find new ways for cooperation without any discrimination, and on a broad and long-term basis.

Now, during my meeting with the group of American senators in Moscow, I raised the question of gas.

Now, that is not an area in which we are insisting on.

And we're not, I said gas, gas.

We're not trying to impose anything on you in that regard.

But gas is indeed today a product.

It's a primary commodity with which one can do wonders.

They can make things out of gas today, which were really inconceivable just a mere 20 years ago.

And I told them, and I would repeat that we have in our country

fast deposits of gas.

And as I said then, we could, the Soviet Union could, for instance, offer the United States one trillion cubic meters of gas.

And it would be, of course, not for me, but for the businessmen, for the various economic organizations in the Soviet Union, and for the businessmen of the United States to calculate

and to see how this question could be resolved and what arrangements could be made.

But there is one very important area for cooperation in the economic field.

If, for instance, the United States wanted to take, let's say, something like 22, 25, 50 cubic meters of gas a year, that would mean that we could enter into an arrangement that would last for some 40 years or so.

So I would be more in favor of Secretary Shultz and Mr. Connolly looking into this matter and discussing it with Minister Katolicev, for instance.

So there are obviously also other areas in which we could reach certain useful agreements.

Of course, there would also be some trade in consumer goods, but I guess that would be less in volume and significance than these long-standing, long-term, and large-scale arrangements.

So there is a need to

take it over very carefully.

Perhaps it would help matters if we speeded up the mobilization in Moscow of the U.S. Trade Center.

So in that matter, I would encourage more American businessmen to come over and engage in concrete discussions on these subjects.

I can certainly assure you that we will give our full cooperation to the building of that Trade Center in Moscow.

And we could, in the meantime, we could also, I think, perhaps, we could set up some working groups.

Let's say one to deal with the problems of power, another to deal with problems of cooperation in the field of the various mineral resources, a third one to deal with possible joint projects, which could

and arrangements for which they have to run for a period of, let's say, 40 years or so in the field of trade, of technological cooperation.

And we could sort out problems of repayment.

We could buy or repay the investments made or the credits extended, let's say, over a period of 10 or 5 or 20 years, as our people could agree.

So it would all then be a matter of pure arithmetic.

Now, at this time, it is not for me to make any specific, to set out any specific program or to list any specific deals or contracts that we could negotiate.

But I do, in general, fully agree with your thinking on this subject as you set it out just now.

So, as I say, if Secretary Shultz and Mr. Connolly could pick something up on a starting picture with Mr. Kucelicev, we would certainly welcome it.

And not only I, but the entire leadership in our country would welcome that, and I'm sure it would also be welcomed by the people in our country.

So if we are, and it does seem that we are, at one with each other as regards the basic goals, it remains for us to think over how best we can implement those, we can reach those goals.

And we do have the experience, the necessary experience.

Surely it was not the easiest of, it was not the easiest possible thing to

great decisions during your first visit to the Soviet Union.

And yet we managed to do so and to arrive at important decisions on questions of very major significance.

We managed to agree on the basis for the development of economic relationships between our country.

I agree with you that this past year has given us cause for gratification.

Our trade has increased from 200 to 700 million dollars in the past year.

And we have already used 70 to 80 percent of the credit you have sent to us.

That means we will be repaying that credit with interest

And that will be to the advantage of America, of the United States.

Now, certain negotiations are now underway on cooperation in the aviation field, certain negotiations with the Boeing Aircraft Corporation.

And there's some talks that are going on as regards the sale of Soviet-built Yak-40 aircraft to be

with the interior decorations and finishing to be provided by the American side.

So that, too, will be a large-scale transaction.

There has been some progress in the field of chemical, in the field of the construction of plants for the production of artificial chemical fertilizer and in return for which the Soviet Union will sell the United States some money.

Of course, there are some areas where I guess we won't be able to sell certain products, certain of our products to the United States.

I don't think we can sell you our automobile because the American automobile industry is more advanced than it's ours.

But I do think that...

If we really get down to business and really start thinking things over, we can find dozens of subjects, dozens of areas in which economic cooperation could be arranged.

And, well, perhaps, Mr. President, I would, on our side, I would suggest perhaps on our side that Mr. Protoshev might add something on that general subject of economic ties, if that means for Google.

Good.

Yeah.

I think that the big countries of the world are beginning to understand that the time has come for us to think bigger.

I want to say that we do not have an agreement, but the litigation is dependent on the Japanese legal work.

to use Yakutsk for their own use.

We didn't agree.

Then there was an option that it would be a joint American-Japanese company.

We agreed, too.

Now, let's say, in Western Germany, Mr. Kant,

He proposed to use the ore of the Kursk ore mining company to restore the iron, in the form of metal attachments.

The production of this memory is 40,000 tons.

Five million tons of iron.

Two million tons of iron.

Yes.

I said that we calculate the amount of iron and send it to all the countries according to their instructions.

Quite recently, whether it is true or not, but I was told that one of the heads of the central staff said that

that they would also like to have factories in this field.

They can build more power than the Federal Republic of Germany.

They called it not 40,000 tons per day, but more.

Yes, more than a thousand tons.

I'm saying this because it's not a deal, it's all done, but as a fact.

that business circles and independent states are starting to think in the same way as we do.

That we need to give a new character, a new form of broad cooperation, especially for the long term.

This is exactly what will strengthen our politics, our trust, our respect and mutual trust.

But on the other hand,

Let me just add to that that all these, the solution to all these very important problems will require a certain support in the form of credits, which we can actually repay with interest.

But today, most of the major countries in the world

are proceeding from the need to negotiate large scale, to think big in the question of economic times.

And for instance, the Japanese business circles are making a very vigorous, are working quite vigorously on

negotiations for emu whereby they would use, they would help develop the Yakutsk oil deposits for Yakutsk oil to be used in Japan.

We gave our consent to that.

Then there was another version appeared whereby, another version appeared, that is for Japan to cooperate with the United States in developing the Yakutsk oil deposits, and we agreed to that possibility as well.

In another area, in the field of metallurgy,

The Koch company in the Federal Republic of Germany suggested building a new type of metallurgical plant and one that bypasses the blast furnace stage and produces iron directly from the ore. And we had negotiated a contract for the building of such a plant on the basis of metal deposits.

That would be a very highly productive plan.

And we're counting on repaying the investments in the form of the finished product to be sent by us to whatever country the West German company indicates.

I was recently told that there was an American company which

field and which have offered to build an even bigger plant of that same kind.

So I'm saying all this not in order to suggest some specific deal, but merely to give an example.

But merely to give an example that today most of the business circles of most countries of the world are thinking in the way that we are thinking.

And so we must try and find some new forms for business-like cooperation.

And that will lead to the strengthening of mutually advantageous ties between us now.

I have two more questions.

Of course, you must, as a representative of the Communist Party, express even your wishes to the Russian people.

That, of course, is a fact that the development of this type of cooperation can be achieved more swiftly and on a more durable basis if the whole thing

gets the awarded support of the President on the American side and our support on our side.

It's a good question.

We have a joint Soviet-American trade commission.

We are co-chairs.

Well, with your commission, Mr. President, and with yours, Comrade General Secretary, may I say we have a joint Soviet-American commission on trade matters.

The commission has met twice.

But it mainly focused its attention on treaty and legal matters.

We drafted and signed a trade agreement.

We signed an agreement on that lease.

Tomorrow we will be signing an agreement on taxation.

In short, we are finalizing these matters.

And we were discussing with what Secretary Shultz today the usefulness perhaps of announcing that we will be opening a trade mission in this country and the United States will be opening a trade office in the Soviet Union.

But we felt that it would be possible perhaps to announce this while the General Secretary is still here in this country.

We can't... We can't... We can't... We can't... We can't... We can't... We can't... We can't... We can't... We can't...

And I also suggested that we might perhaps announce the formation of

of organizing committees on the Joint Chamber of Commerce.

And that, too, would have, we feel, a very good response.

We would set up an organizing committee on our side, and you would set up your own, and we could announce this.

We had then announced that the Organizing Committees on both sides could get together and lay down a joint statute or program.

We could then have a founding meeting and the Joint Chambers of the American Chamber of Commerce would thereby commit to meeting.

And this is important for us because that body could help.

establish and develop contacts between our organizations and the various American companies interested in... American companies and firms

have been applying to us for permission to establish permanent offices in Moscow, and we have already taken positive decisions in several cases.

And it will be even easier for us to do so with the train centers.

That is one aspect of this.

And Secretary Shultz and I agreed that once these matters had been cleared away, our Joint Commission could cut down and concentrate on

questions of trade proper.

And we agreed that in the first half of October we would have the third session of our Joint Commission in Moscow.

But may I just say that

The viewpoint that I advocate is this.

If the President of the United States and the General Secretary can meet once a year, why can't the foreign trading ministers meet twice a year?

Because I think we should do some very intensive work together.

In the next three years, it will be 1.3 billion.

We will create a number of working groups that will consider specific issues.

And we can set up some joint working groups which would deal with specific questions like gas.

Various problems relating to power consuming industries.

And all these are very serious matters.

And we have been receiving many offers from American companies for the building of various joint projects on compensatory basis.

I'll be back in just a minute.

are compensatory places, that is, investments to be repaid by deliveries of the finished products of the project to be built.

The figures I have cited showing an increase in trade between our two countries

Relate basically to increases in our imports.

Our agreement on the automobile plant is being implemented.

We have purchased

equipment from companies such as Caterpillar and others.

Then of course there has been a great deal.

And the increase we're planning for the coming year will also take place basically by virtue of the increases in our imports.

The first large-scale agreement that we've negotiated with Occidental Petroleum requires very intensive work.

We will have to sign contracts for equipment with many firms in the United States.

On the Yakutsk gas project, we're negotiating with El Paso.

On the Chumen gas project, we are negotiating with three companies, Teneco and the two others.

And in the course of this year, I think we can do some important work together in the field of gas.

We've begun negotiations with Boeing to name but a few.

So I believe that we could set up some joint working groups to deal with specific problems, and those working groups could then report

Of course, we will cooperate in certain problems in the field of credits.

And that too is something that Secretary Shultz and I discussed.

back in 1880.

That was long before the Soviet Union ever came into existence.

Under that law, any private bank in the United States

give, extend credit to one and the same organization to the amount of not more than 10% of the paid capital and plus the reserve in that bank.

On our side, the bank that has been dealing with these matters has been the Foreign Trade Bank.

But I think we've managed to find some common language with Secretary Shultz on this matter, and I think he can come to an agreement soon.

And the basis there will be that the various foreign trade corporations, associations in our country will play the part of receivers of such credit.

But I guess that matter requires some additional discussion.

for the future, that a good deal of work will have to be done, and we will require some help and support to make trade increases, to ensure higher trade increases that have been the case up to now.

Excuse me if I've been too long.

I remember my meeting with the minister in my office.

It's a very good salesman voice.

Now here are our salesmen.

Well, Mr. President, I will say the very first.

First, let me say that

We met for only 45 minutes today, and you can see what a large amount of ground we covered.

So I think that gives hope that the Commission can continue to be productive.

I think the idea is that they don't work too long with us.

Well, I'll come to that.

Well I think the idea of having a commission that meets periodically perhaps twice a year or in some rhythm and takes the overall umbrella of the spirit that you two have spoken of and generated and takes the particular agreements that have been worked out as an umbrella and then

address particular problems as they come along and solve those problems is a very good idea.

We can adapt ourselves and try to see what makes sense as we go along.

I think the problems that

Mr. Kotelich, I've mentioned to illustrate the variety here of where we stand.

You mentioned the problem with our 1880 law, and that is a problem we identified, and I think as we work at it, we'll be able to solve that problem.

That's just a problem that came up that we're clearing up, so that illustrates it good.

about the pattern of discussions, not only between you and I, but between the staff people involved.

Sure.

The current problems show what we have to deal with.

As for the law of 1880, it is one of the problems that we are dealing with.

I think that we are on the right track to its successful approval.

And then you mentioned the problem of facilities, and we were gratified to know of the facilities that you are willing to make available to us.

On the other hand, that particular situation illustrates one difficulty, namely the price.

At this stage of the game, we think that things are awfully expensive in the Soviet Union.

and that we shouldn't have to pay ten times what the British pay, and so on.

So I would expect that you will see us arguing about things like that.

You know, that's not your problem to argue about that, but it is our problem to work it out.

We'll work it out somehow or other.

I know you'll wind up being very agreeable.

But that illustrates another type of problem.

that can come up.

And it is a matter of principle, just money.

And so I think that that is principle.

Then the question about providing us with various opportunities for the Soviet Union.

And we are glad that you are providing us with such opportunities.

One of the problems that we face here is the question of prices.

It seems to us that we are forced to pay a little too much for some things in the Soviet Union.

And I don't think that we should pay, say, ten times more than the English pay.

But this is a question that you, our leaders, do not argue about.

It is our job to argue about such issues.

I think that...

I know that in the end we will be able to solve this difficulty.

The question is not about the reality, the question is about the problem of money.

When you say you have to pay 10 times more than the British, do you clarify that?

Well, it is our estimate that if you take some measure, like square feet or something like that, and put what the pair of us, the British, are required to say, or are paying, and what we have been asked, that the

The price is a great deal higher.

But I don't want to get into a debate about that.

I just wanted to suggest that there will be lots of bargaining about, not about principle, but about price.

And that's to be expected of the convention facility, and so we have an illustration.

So this is for a marketing company's reason?

No, this is for the...

commercial office of the government, which is, I believe, for the office of the .

then we will be asked much more questions than we will be asked to answer.

But I am talking about it here, not to spoil it, but simply as a simple illustration of some of the questions we have to deal with.

We will deal with these questions ourselves, and I am sure we will come to a conclusive solution.

But I do not refuse to answer the question of the truth.

Well, you can rely on my assistance.

Let me mention other illustrations, I think, of what the commission needs to get into.

You mentioned grain, and here I think we see an example

of where it will be to our digital advantage to have as much information about your needs, our crops, and so forth, as we can as we go along.

So that on the one hand, we can serve the needs that are there, which is to our advantage as well as to yours.

And at the same time, sudden unexpected demands don't disrupt our markets and cause us great difficulty in our transportation system and things like that.

You and I talked about that when I was in Moscow, but it seemed to me the Commission ought to be a place where this kind of information exchange could take place.

There is another example of what our joint commission should do.

You mentioned grains here.

I think that for both sides, we should have more information about your needs in the sense of grain.

And you have information about our crops, about the size of our crops, so that we can systematically meet your needs.

And I also believe that in the face of such a situation, when you suddenly have needs,

This is a very big question.

Well, that's a very important problem, too, and I trust you will not object if President Nixon and I take some part in that discussion, too.

We might help you some way.

Do we permit them to do that?

You don't object to us participating in that discussion, do you?

This debate is more difficult than this one.

But I am seeing.

I am seeing.

We don't seem to be able to come to the actual problems of trade before we build a trade center.

I think we should do it all together.

I mean, build a house and trade, and organize trade at the same time.

It's much easier to get information about the situation of the population.

for a mutual exchange of information on missiles, we can surely reach an agreement to inform one another on these questions of grain and requirements and .

But I really think, seriously, that perhaps the President and I could talk this over and maybe we could really help you.

As a matter of fact, the General Secretary and I, in our private chats yesterday, he was talking to me in considerable length about the crops this year.

And I can confirm to those present here that when we were talking one-on-one with the general, he was just telling me about the current situation in the Soviet agricultural economy and about the types of crops.

That's right.

I would advise to take information on a longer term.

That is true, and I can also give my consent to arrange for an exchange of information on a more long-term basis, because one year is not enough, right?

What is the perspective?

And in that context, I'm happy that the president would agree that we could have a little discussion on that.

What else?

Which in no way contradicts anything that you said.

Well, I think these very large

deals, oil and gas deals are obviously of tremendous importance.

And it seems to me we can only emphasize how important it is to ensure we know what we're doing, to study them, as you were suggesting, carefully.

We want to see our companies that are interested in these projects be able to move ahead to gather the information they need and for us all to generate the facts necessary to assess whether or not

a particular arrangement will be mutually beneficial to you.

And I think at that end, we hope that the Superstar project group can move along.

We want it to move along, and we trust that you do, too.

And I gather the people involved may be coming around very shortly on that.

Then, on the issue of oil and gas, this is a really huge issue.

I think that we can emphasize the importance of these issues in the achievement of the agreement on it.

And we want to encourage you to have a specific interest in solving these problems with our company.

We want the negotiations to go forward, and to have specific prospects, to have the opportunity

Secretary Shultz suggested to Governor Connolly, who is familiar with both of these groups, might say a word on it.

What I mean, one of the projects, I think from the North Star project, there's been a very great progress, there's no protocol, and it's further along than the, that's what I mean, the Coos project, because the Coos don't have the reserves now to justify the details of the contracts

On the North Star project, you have approximately 135,000 cubic feet of proven reserves.

So this project really, it probably is two to three years further along, at least from the way we see it, than the Yacuzzi project.

But they, for some reason, and I'm really unknown to Pinnacle, Texas Eastern, and the others, there's been no signed protocol on that, yet they've signed one on the Yacuzzi, and I think they did it properly.

And actually, we ought to know it.

But they're actually, all the companies are actually moving ahead.

Let us make clear that we're, that here we have private companies that, as far as the government is concerned, we're working for both projects.

No question.

Thank you.

I would suggest that I say a few words to Mr. Connery, who is well aware of these issues related to oil and gas, and to which I can maybe add what was said.

Mr. Connery, I know that in relation to the North Star project, that is, the Temetsk project,

There was a certain progress in the negotiations, although for some reason it was not yet possible to sign the protocol.

By the way, this project of the North Star, that is, Temeskiy, in general, received more development and it is more prospective than Zhytomyr.

Because as far as the Yakutsk place of birth is concerned, there are still a few confirmed cases.

Therefore, the case will stand for another 2-3 years.

The case will take another 2-3 years to talk about something specific and deal with specific issues.

In Temenskoye Mestorodzhenye, the reserves have already been secured.

It became a closer matter.

However, for some reason, and we would like to know if this is possible, for some reason, and what are the difficulties here, the protocol has not yet been signed, although in the Yakutsk project the protocol has already been signed.

One other thing.

At some point, we might start considering something

Secretary and others have mentioned this question always.

When you look at the adjusted amount of gas, not counting the fertilizer deal of Occidental and the trade and all the other possible trades in the Soviet Union,

Just the oil and gas things that we now talk about, since Newt's been lost, starting to talk about eight to ten billion dollars over the next couple of years.

And I just, obviously I'm not in a position to say what this government can do or what our institutions can do.

It seems to me we're going to have to think in terms of

different way of financing these.

I don't know how you're going to continually finance, how we're going to continue to finance all these projects.

Maybe we can.

But I frankly doubt that we can do it through the export import.

Maybe we can.

But I think that raises a serious question as to whether or not we can do it that way.

Mr. President, there is one more problem that we will have to think about.

This is the problem of financing of these projects.

In addition to other types of trade, there are projects related to oil and gas.

The fact is that the implementation of these projects will require a total investment of approximately $8,000.

and billions of dollars for the coming years.

This is a very large loan and we need to think very carefully about financing.

The fact is that I cannot talk about the capabilities of the current government.

This is done by the government itself.

But I think that it will be difficult to finance it just through the export to the United States.

Maybe we will have to find some new ways of financing, to agree on some new ways of financing these largest projects.

Would the Commission be in the proper place, John?

I was expecting probably George to more properly handle it and direct the occasion before turning it over to Mr. York's commission.

But maybe not.

If the commission becomes that active, my boy will take on this.

I think that maybe it would be better to think about this issue and exchange opinions through direct contact with trade ministers.

Because, of course, it can be considered within the framework of our joint committee, but if the committee meets only twice a year, then maybe it will delay the solution of the issue.

Well, perhaps Mr. President and the Minister of Telegraph and Secretary Shultz and Mr. Connolly could talk over some more and then report back to us.

The deposits there are really enormous.

Because of my modesty and carelessness, I named the minimum numbers that were registered there as extractable deposits.

But this number was almost double.

I was just very careful.

As for the loans, of course, we can't go without them and without the government of the first company.

I can't say anything about the size, because I don't know.

Five billion, three billion, three billion.

But it should be mutually beneficial.

It should satisfy your and our people.

It's not like you built it and it's not beneficial for you, and it's not going to be beneficial for us.

We rely completely on your and our calculations so that your government and the President know

And we knew that it would be mutually beneficial.

That is, in fact, the principle.

And you are talking about a decision-making machine.

You are solving the question of what equipment to set up, what pipes, how to move through the white sea, for example, into the mountains.

These are already questions of the organizational unit.

Well, in principle, in order for such a large deal to be made.

Moreover, what they reported to me, what I personally know, it is possible from 25, maybe up to 40 days, but the term is too long to use, to get a contract.

By the way, I forgot to say that now I didn't know about the reasons for this, because I was busy with trips.

But recently I learned that we have received an invitation from the firm to come to Moscow for more in-depth details of the negotiations on this issue.

The invitation has already been sent.

We are waiting for the arrival of your business people, specialists, let them come again.

When I was mentioning the figures for the size of the deposits of gas, I mentioned out of modesty, I mentioned the minimal figures.

As far as the question of credits, well, quite obviously, we won't be able to get by without credits, and credits will need to be guaranteed by, in some way, by the state.

But one thing I'm quite sure of is that the whole thing should be based on mutual advantage.

And that is something that the experts on both sides will have to calculate very thoroughly.

It is on the basis of their calculations that a judgment can be made on what the advantages will be to each side and how big those advantages will be.

And it will be up to the technical experts also to take out all the technical aspects of this question.

But in principle, we will lend our support to this transaction being on as large a scale as possible.

As I see it, it can be a transaction to last for 35 to 40 years, which is quite a decent period of time.

Now, I do not know the reasons.

I have not looked into the reasons for this holdup that you were mentioning on our side.

and their people are coming to Moscow to to four additional talks.

And so I think we should let them engage in those talks and try and eliminate whatever there are.

I was going to say to the Secretary, it's obvious that this is a case where we have to consider individual deals.

and put our best people on it with a positive push from the highest levels.

And we must set up the institution.

And we need to get in touch with the organizations, the institutes that will find a way to bring this great complex of American private companies in contact with the Soviet Union.

When the general secretary meets with business leaders, he has to see the ambassador he's found.

He's going to find that, and I've met with him in this room,

to find their own enthusiastic about trade with the Soviet Union, but they don't know how, they don't know where to go, how to do it.

When you meet with the representatives of our business world, and your ambassador can confirm this based on his experience here, you will see that they are full of enthusiasm regarding the development of such cooperation with the Soviet Union, but sometimes they just don't know how to answer this question.

I was going to say, too, that Secretary has been kept too long by the Senate and even too long by us.

So I would suggest that we, with his permission, that we adjourn now.

And we would hope that the two ministers would meet tomorrow, not only to discuss the tax matter, but also...

Well, we all checked.

Well, the general secretary and I.

are solving easy problems like so we'll have them handle the difficult problems

I would like to answer another question.

I once again found myself here.

Mr. President, may I just express my very

Mr. President, I would like to thank you and your colleagues for this question.

And I would also like to inform you

I think there is a problem that needs to be solved.

But in the global context of the Internet, different systems, your company, our Ministry,

We have 52 ministers, who are in charge of the decisions of the party, that is, they are in charge of all the national economy.

One is in charge of metallurgy, the other is in charge of coal, the third is in charge of oil.

In your turn, too.

One company is engaged in chemistry, another company is engaged in metallurgy, the third is in aviation, the fourth is in something else.

All of them represent America.

All our institutions are represented by the Soviet Union.

And if the government and the leadership of the countries are interested in this, then the system itself should not deprive us of the opportunity to cooperate and bring mutual benefit to our countries and our people.

So I look at the question.

I agree with your responsibility.

Let them all work and find something pleasant.

And more in-depth contact with specific people will probably help them even more.

Find a way to solve the problem.

I've listened very attentively to what was said here by Secretary Shultz and Mr. Connolly, and also to what was said on our side by Mr. Pocha.

And I see that there are certain issues which can be discussed.

But on a global, on a broad, but speaking broadly, as I see it,

Our different systems are not an obstacle.

You have your private companies.

We have our relevant branch ministries.

Our 52 ministries deal with various specific branches of the economy, with metallurgy, with coal, with oil, gas, and so forth.

Just as your various companies deal with one specific area, again, and the areas are the same, oil, gas, metallurgy, and so forth.

But all of our ministries, all of our departments do, in the final analysis, represent the Soviet Union, just as all of the American companies, even though privately owned, do represent the United States.

So surely if our two governments, if our leaders display an interest in this whole problem, the difference in systems should not decry us an opportunity to cooperate and to thus bring new benefits

As for the concrete transactions and agreements, I quite agree that they should be discussed by the experts on both sides and let them do some work in order to find some solutions.

mutually acceptable decisions.

And I feel that when we get broader contact between the business community of this country and our own product, and our people on the other side working in the same fields, the progress will be even faster.

I would say that in the last year in this field we have learned to walk and now we must learn to run.

Thank you.

I don't know