Yugoslavia Nat ional Policy Is
To Get Best From Two Worlds
(Editor's note: Recent newt
from Brussels that Commu
nist Yugoslavia had been
making feelers for an asso
ciation with the West Euro
pean Common Market rais
ed questions as to whether
President Tito was "going
capitalist." Tito has confus
ed people before, both com
munists and noncommu
nists. This dispatch, assem
bled by UPI reporters in
Belgrade, Brussels, Frank
furt and London, examines
this latest maneuver and the
reasons for it.)
By United Press International
Ever since he seized pow
er in World War II, Presi
dent Josip Broz Tito of Yu
goslavia has made a nation-
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al policy of seeking the best
of two worlds - East and
West.
He is pursuing thia policy
now in sounding out what
advantages there might be
for communist Yugoslavia
from an association with the
capitalistic common market
of West Europe.
No formal application for
joining has yet come from
Belgrade, but observers in
Brussels, scat of the six-nation
common market, think
there may be one. And they
think, too, that the common
market nations - France,
West Germany, Italy, Hol
land, Belgium and Luxem
bourg - would react favor
ably. Could Hold Advantages
A trade partnership could
hold advantages for both
sides, politically as well as
economically.
This is how the matter is
viewed in Brussels:
- Because Yugoslavia's
general economic develop
ment is below that of the
common market "six," it
would not be likely to be
granted full partnership but
rather given association
status, as has already been
done with Greece. The de
tails would have to be iron-
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cd out in talks that might
take up to a year after for
mal application was made.
A customs union would
have to be gradually estab
lished so that selected Yugo
slav goods could enter the
common market countries
tariff and quota free, and
vice versa.
Could Offer Loans
It is possible the six would
offer Yugoslavia develop
ment loans - Greece for ex
ample is getting $125 mil
lion over the first five years
of its associate status.
- If Yugoslavia ignored
or contested the common
market, it would be up
against tariffs and quotas
imposed by the six on im
ports of non-member goods.
This could have the effect
of pricing the Yugoslavs out
of the West European mar
ket and forcing them to find
new markets elsewhere -mostly
to the east.
This in turn probably
would, in the Brussels view,
shove Yugoslavia more
strongly into the Soviet or
bit. Obviously, western Eu
rope doesn't want this to
happen so there would be
political advantages to en
couraging Yugoslavia's bid.
Economic Advantage!
-There are economic ad
vantages for the six, as well.
With the removal of tariffs
and quotas by Yugoslavia
on goods from the common
market partners, the six
would gain a new customer
for a wider variety of ex-,
ports and would sell more
of them because they would
be cheaper to the Yugoslav
consumer.
From the Yugoslav stand
point, the situation is this:
-The country, with a rel
atively low standard of liv
ing, needs both to increase
its exports and be able to
import more for less money.
An association with the
common market presuma
bly would enable Yugoslav
ia to sell its member coun
tries more minerals (chief
ly lead and copper), timber
and-aiming mainly at the
Italian and West German
markets-more fresh fruits
and vegetables.
Well-Equipped Shipyard!
Yugoslavia also has well
equipped shipyards with
lower labor costs prevailing
than in Western Europe and
believes it could snare some
business from higher-priced
British, German and even
Dutch ship-builders.
-Yugoslavia's chief im
ports are cotton and wool,
coke, crude oil, raw mater
ials for industry, lard, sugar
and, above all, wheat. The
country grows only three of
the four million tons it
needs to feed its people ev
ery year. It has had to im
port wheat every year since
the war except in 1959
when it had an exceptional
ly rich harvest.
-Generally speaking, in
sounding out the common
market nations, Yugoslavia
is aiming at expanding ex
port markets to a much
wider field, to Asia, Africa,
Latin America.
Farther Than Europe
The products it hopes to
sell farther afield than Eu
rope Include tobacco, meat
and meat products (many
canned varieties of Yugo
slav meat already can be
found on British and some
other continental store
shelves), and also precision
tools for small factories,
farm machinery - and
smoked plums. Only Canada
out-produces Yugoslavia in
smoked plums.
Yugoslavia itself is a com
munist country with some
capitalistic overtones. The
mixture shows itself in its
agriculture. The Soviet Un
ion and its satellites have
collectivized their farms,
but in Yugoslavia about 80
per cent of farm land re
mains in the hands of pri
vate farmers making a com
fortable living.
There are restrictions on
this agricultural free enter
prise. By law no farmer
may own more than 10 hec
tares of land-about 24 acres.
And he must depend on the
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state farms for use of trac
tors and similar equipment
which cannot be privately
owned.
From time to time there
have been reports even the
small hectare limit was
to be lowered, but at pres
ent there is even more agi
tation to enlarge the pri
vate farms.
According to western ex
perts, Tito has pocketbook
reasons for encouraging
some free enterprise on the
farms while all industry re
mains state - owned. These
observers say the state, or
collectivized, farms lose
money and require consid
erable financial priming.
The private farms pay their
own way and strengthen
the economy.
In general, the small farm
ers seem satisfied. UPI
questioned two of the m
near Belgrade.
Pantelija Jovovic, who
owns 13 acres, said: "Coop
eration (with the state farm
ministry) is very useful
when it is in the hands of
honest people. My field
yields much more now, in
some cases double, than it
did before the war."
Milan Pavlovic who farms
18 acres with his two teen
age sons, said: "I am living
today on my own land with
my two sons much better
than I ever lived with my
father in old Yugoslavia."
But if most Yugoslavs are
eating better, they lack
many conveniences the peo
ple of the common market
countries take for granted
and can afford. That's
where the country's trade
problems come in. Yugo
slavia must now import
more than it exports -or
even can export.
It needs the imports to
feed itself and improve the
lot of its citizens; it also has
to de auie to increase inem
to get more of the materials
required to produce a great
er quantity of money-making
exports.
Has Financial Struggle
By western standards, the
Yugoslav wage-earner has a
financial struggle. Estimat
ed income of the average
Yugoslav worker is between
$22 and $33 a month.
Monthly rent for a two
room flat in the -capital,
Belgrade, ranges from $2.60
per month for the very
poorest to about $21 in a
new apartment house.
Bread costs seven cents a
pound. A pound of beef
costs 50 cents, or about half
a day's pay. A decent suit
takes more than a full
month's earnings.
Even at the top of the
earning scale, incomes are
low to western eyes. A suc
cessful Belgrade lawyer can
earn about $135 a month,
There is general agree
ment, in Brussels and else
where in Europe, that in
flirting with western trad
ing markets, Tito is not in
the least relaxing his sys
tem of "Nationalist Com
munism." Rather, say long-term ob
servers of Tito's Yugoslavia,
he is simply being practical
according to his own lights.
11 is partly this willing
ness to get the most advan
tage from both sides in the
cold war that has brought
Tito the wrath of the Chi
nese Communists who
call him a renegade and a
traitor.
Accounts for Trouble
It also has accounted for
the troubles he has had with
Moscow, although Soviet
Premier Nikita Khrushchev,
also a practical man, cur
rently is wooing Belgrade.
A Common Market nego
tiator told UPI: "The main
thing to remember is that if
Tito makes overtures to us,
he is doing it for what he
hopes to get out of it. We
listen to him for the same
reason; business goes both
ways. But Tito is the same
dedicated Communist he al
ways has been and all deal
ings with him must be con
sidered in this contest. If
there was a war he
wouldn't be on our side."
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