176. Note Prepared in the Situation Room1
Soviet Bank for Foreign Trade’s Urgent Requirement for Funds
A reliable clandestine source reports the chairman and deputy chairman of the Soviet State Bank believe the Soviet Bank for Foreign Trade (VTB) does not have sufficient money to meet all its commitments.
• The officials felt that was the reason all the Soviet-owned banks abroad were urgently required to search for funds to transfer to VTB.
• The Soviets hope the situation will improve as the year progresses, decreasing the need to impose drastic cuts on lending to other CEMA countries. (S)
In a possibly related matter, the U.S. grain consultation team recently concluded two days of talks with the Soviet team and found particularly interesting Soviet indications that financial resources and financing were a current problem. Additionally, Soviet grain officials in Moscow recently told a U.S. businessman that the USSR did not have hard currency for grain purchases at this time, allegedly because the new allocation of funds had not been approved.
• However, a U.S. businessman claims Western banks still consider the Soviets good credit risks for grain financing. The banks are cur[Page 572]rently considering Soviet requests that their present loan terms be extended.2 (C)
- Source: Reagan Library, Executive Secretariat, NSC: Country File: USSR (5/24/82–5/29/82). Secret. Poindexter wrote in the upper right-hand corner of the memorandum: “President has seen.”↩
- Poindexter bracketed the final two paragraphs and wrote at the bottom of the note: “Judge, We must be very careful on this. Our position may be a bit of a dichotomy. We have grain to sell and are willing to sell and even willing to extend credit. The Europeans have industrial products and are willing to sell and finance. We are asking them for credit restrictions. I’ve asked Henry to do a paper for President.”↩