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Bush grants Soviet Union food credits President also sets summit Feb. 11-13 to sign arms treaty


WASHINGTON -- President Bush granted credit guarantees worth up to $1 billion yesterday to allow a hungry Soviet Union to buy American food and scheduled a Feb. 11-13 superpower summit in Moscow for signing a treaty cutting long-range nuclear arms.

Minutes later, a grateful Soviet Foreign Minister Eduard A. Shevardnadze made a further appeal for Western support for his rocky government, warning that historic agreements stabilizing European security could be in jeopardy if the Soviet Union broke apart.

"It would be a terrible thing if we were unable to assure stability in the U.S.S.R.," he said.

"It would be a terrible thing for Europe and the world. It would mean negating the very important treaties signed in Paris, the historic treaties signed in Paris," he added, referring to last month's pact cutting conventional arms.

The credit guarantees marked the first official U.S. response to a food shortage in the Soviet Union caused by a collapsed distribution system in a nation struggling between state control and private enterprise.

The credits will allow the Soviets to buy food, primarily grain, from private U.S. sources, with payment guaranteed by the U.S. government, Secretary of State James A. Baker III said. The credits, valued at $500 million to $1 billion, will be administered by the Commodity Credit Corporation.

Broader expansion of trade is in prospect, Mr. Shevardnadze said. In preparation for the February summit, he said, "a very important package of other agreements is emerging, and it will be signed as regards our cooperation in trade, in the economy, in science and technology" and investment.

To provide the credits, Mr. Bush granted a waiver of the Jackson-Vanik amendment, which ties expanded U.S.-Soviet trade to the passage of a liberalized emigration law by the Soviet parliament.

But he said that even though the Soviets had made "generally excellent" strides on emigration, passage of the law would be necessary before trade and economic relations could be normalized.

Mr. Bush avoided direct food aid, although none apparently was sought, and stressed anew the need for Soviet economic reform.

Appearing in the White House Rose Garden with Mr. Shevardnadze and Mr. Baker, the president said, "We discussed frankly the relationship of economic change in the Soviet Union to the critical task of democratization, and I reiterated our strong desire to see both political and economic reform continue, because they are inextricably linked."

Mr. Bush offered technical assistance on food distribution and economic reform, and he proposed allowing the Soviets to tap the expertise of the World Bank and International Monetary Fund.

"The Soviet Union is facing tough times, difficult times," Mr. Bush said. "I believe this is a good reason to act now in order to help the Soviet Union stay the course of democratization and undertake market reforms."

U.S. officials have become increasingly worried about Soviet instability and what it portends for the ability of President Mikhail S. Gorbachev, whose cooperation the United States values, to stay in power.

"Instability in the Soviet Union is very definitely not in my view in the interests of the United States of America [or] in the interests of the world," Mr. Baker said.

Mr. Bush said that the two countries had made "great progress" on the Strategic Arms Reduction Treaty, adding that he was hopeful the treaty would be ready in time for the Moscow summit.

Mr. Baker said that the remaining problems with START involve "very technical issues" of verification, the monitoring of solid-rocket facilities and missile-assembly sites.

Both sides denied that yesterday's offer of food credits was in any way a payoff for Soviet support for U.S. actions in the Persian Gulf.

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