Maryland businesses woo Soviets Columbia firm's pact leads to joint venture


The United States has postponed its arms summit in Moscow. European countries are considering suspending economic aid to the Soviet Union. And American lawmakers recently passed resolutions condemning the Soviets for the military crackdowns in Lithuania and Latvia that left 19 people dead.

But Maryland businesses are going ahead with plans to invest and trade in the Soviet Union.

"If we survived the Afghanistan embargo, then this time we can stay in business," said Mark Selawry, project manager with the Argus Trading Co., which exports to the Soviet Union equipment to manufacture circuit boards.

U.S.-Soviet relations are far different today than in 1980 when Jimmy Carter imposed a trade embargo on the Soviets for their invasion of Afghanistan. While Ronald Reagan lifted the grain embargo in 1981, he placed new economic sanctions against the Soviet Union for the repression of Poland. Those sanctions lasted until Mikhail Gorbachev came to power in 1985.

This time, "basically business is going on as usual," Selawry said. On Jan. 20, when Soviet troops charged a Latvian police station, Argus concluded a deal in the Latvian capital Riga to import equipment to repair circuit boards.

Columbia-based S3 Technologies is preparing to enter the second phase of an agreement with the Soviet Union to build nuclear power plant simulation systems. Nancy Ryan, a spokesman for the company, said workers soon will be traveling to Moscow to install the systems, which are used to train nuclear power plant operators.

So successful have relations been between S3 Technologies and the Soviet organization that oversees nuclear power plant operations that the two have formed a joint venture called General Energy Technologies. This new company will help establish technology training programs in the Soviet Union. So far, neither the joint venture nor the original contract has been adversely affected by recent events in the Soviet Union, company officials said.

One Baltimore-based organization has not been so fortunate, however. The American Center for International Leadership finds its existence in jeopardy after a major conference scheduled for Leningrad was canceled two weeks ago.

The center, which moved to Baltimore last April and employs nine people, is designed to promote understanding between business and government leaders from the United States and other countries.

Stephen Hayes, president of the center, said 150 American business and government leaders were supposed to fly to the Soviet Union, but the trip was canceled after a number of the participants changed their minds about going. Hayes said concern over the Persian Gulf war was the main reason for the cancellations, but the violence in the Baltics was also a factor.

The center currently is working to reschedule the conference.

Although Hayes said the cancellation of the event threatened the very existence of the center, recent talks have been encouraging. The tensions in the Baltics appear to have eased and the center now is considering taking at least part of the group to the Soviet Union. "It's just starting to turn around, but we're not out of the woods yet," he said.

Even in good times, business with the Soviet Union can be risky. Besides dealing with the usual difficulties of communication, business leaders also must figure out with which government entity to deal. Selawry said even a company such as Argus, which has been trading with the Soviet Union since 1981, has had trouble recently collecting its bills from the Soviets.

Argus concentrates its work in the Soviet Union and Eastern Europe, but lately has been curtailing its activities in the U.S.S.R., he said.

Robert Babcock, a Columbia builder who has been working on projects in Moscow, said he was not surprised at the recent turn of events in the Baltics.

"It's been going on for 11 months," he said. "Gorbachev keeps trying to tell them [the Baltic states] not to be independent . . . Gorbachev had to do something."

Babcock said that, while he regrets the bloodshed, he believes the United States should go ahead with plans to export grain as a means to improve trade relations.

"The largest consumer front in the entire world has just opened up," he said.

Although there is risk now, he said he expects in 10 to 15 years the market will be "incredible."

For now, however, many Maryland companies are moving cautiously, said Robert McDonald, with the Maryland International Division, a state agency that promotes foreign trade.

"Business relations with Maryland companies and the Soviet Union are in the formative stages," McDonald said.

Maryland has entered into several trade and exchange programs with Russia -- the Soviet Union's largest republic -- but has not made any agreements with Baltic states or the Soviet government itself, he said.

So far the Baltic events have not affected any of the state's trade agreements or exchange programs, said Robert Walker, deputy secretary for the Maryland Department of Agriculture.

"At this point, nothing has been adversely affected, but clearly events in the Baltic states cause additional concern," he said.

Maryland has participated in several agriculture exchanges. In April, the state is to play host to Soviet veterinary students and aqua-culturalists. The Maryland Department of Agriculture is looking for state farmers interested in spending two weeks in the Soviet Union.

Walker said he doesn't anticipate any problems with those exchanges, and pointed out that such exchanges can contribute to the democratization of the Soviet Union. Should the U.S. State Department so advise, Maryland would postpone the programs, Walker said.

"That part of the world involves a lot of risk," Walker said. "There's a lot of interest, but also a lot of reluctance."

Hoping to reassure Maryland businessmen, Moscow Mayor Gavriil K. Popov visited Baltimore last week. Popov met with several businessmen hoping to work out a housing construction agreement.

The mayor said he was concerned that the events in the Baltics could harm business negotiations, but he said the Soviets want to be flexible. "There is a pervading line of cooperation," he said.

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