885096467

J PRS-EER-91 -053 25 April 1991

ECONOMIC

41

credits. Proprietary compensation itself, in our opinion, is neither desirable, nor acceptable. However, we do agree that if the govemment is bcnt on granting financial compensation, such compensation should be in the form of certificates of purchase; this in tum means that purchase coupons must be madę an integral part of the overall privatization process. Such a privatization program could offer cven morę than just compensation certificates. Of course, privatization techniques consti-tute only a smali segment of the crisis management program, as privatization is a medium-range task, while crisis management programs take one to two years to show results.

[Pęto] To what extent will the SZDSZ program to be put on the table in April, reflect the views of the two main, or as some describe them, liberał and near social demo-cratic trends within the party.

[Juhasz] Thcre are indeed two trends represented within the SZDSZ, but I would not describe them as liberał and social democratic. The real distinction is betwcen a legał and an anarchist trend, representing different styles and objectives. As far as I can tell, “thank goodness,” the majority is behind the legał trend, which thinks morę in terms of helping to build a political order than opposing the govemment in power. As far as the content of the program is conccmed, not cven a liberał party can afford to be fundamentalist. In addition to liberał principles, such a party must also accept values dictated by solidarny, but not by social democratic means, as we do not want to rely on our State institutions to achieve our goals.

(Pęto) Peter Tolgyessy, the former leader of the SZDSZ faction, appeared willing to form a coalition with the Smallholders at last week’s delegate conference. Does the present leadership of the party share his view?

[Juhasz] No, we would not enter into a coalition with today’s Smallholders party. Incidentally, subsequent speakers all rejected Tolgyessy’s proposal. In principle, we share the concept of a grand coalition, and other similar ideas, provided that we can agree on the details. We consider it essential for the focus of the govemment’s efforts to be on economic issues and on the creation of new institutions. There already appear to be signs of a consensus, as most politicians of the MDF think in terms of West European models.

[Pęto] So the only problem is that the government coalition is not focusing on what it should?

[Juhasz] Exactly.

Implications of Possible Grain Surplus Analyzed

91CH0486A Budapest TALLOZO in Hungarian 15 Mar 91 p 489

[Article by Tunde Torok reprinted from the 6 March 1991 issue of VILAGGAZDASAG: “A Grain Surplus Could Lcad to Agriculture’s Collapse”—first paragraph is YILAGGAZDASAG introduction] [Text] If there is a good wheat crop this year, we might havc to cope with a grain surplus of 2.5 million metric tons after the harvest. According to experts, this could be a much greater problem that what milk and meat pro-duction pose; the very survival of the Hungarian village could be in doubt. With the ban on wheat cxports still in place, the domestic demand declining, and the govem-ment unable to act in the interest of retaining the Soviet market, grain prices in world markets have dropped to their lowest point in several years.

Cooperation among those who have an interest in the grain market is becoming increasingly urgent, as has the support of also the Committee for an Orderly Market for Farm Products. It was announced at the two organiza-tions’ meeting held yesterday that a Grain Council will soon be formed with the help of representatives of the National Committee of Grain Growers and the Grain Industry Association. Grain growers, processors, traders, and the ministries conccmed will be represented on the Grain Council. Similar organizations were formed in West Europę 40 to 50 years ago, in situations that likewise were most critical. We can hardly expect the Grain Council to perform miracles; it will be able to assumc a morę meaningful role only by the autumn of next year at best. The government holds the key to a solution in the present situation, and it is the govem-ment’s responsibility to come up with a solution.

As far as our domestic and foreign marketing opportu-nities are conccmed, the representatives of our biggest grain traders (Agrimpex, and the Grain Trading Lim-ited-Liability Company) have no reassuring news regarding the long-term financing of grain stocks.

The price of wheat in world markets is at its Iow, thanks to an abundant wheat crop. There is a virtual trade war between the United States and the EC, over dismantling their grain surpluses. Which means that we are unable to compete with the $50 export subsidy of the United States, and the EC export subsidies ranging from $ 120 to $130.

The end of the Gulf war could produce slight marketing opportunities only through the lifting of the embargo against Iraq, but Hungary is unlikely to get a share of supplying this additional demand.

German reunification means that we have lost also our GDR market, to which we were exporting between 160,000 and 170,000 metric tons of grain. Since the reunification, we have been petitioning the EC to com-pensate us for this dropout by giving us at least a share of the aid shipments to the Soviet Union, but so far, the EC has been tuming a deaf ear.

The Soviet Union is also a key issue in the case of wheat. With the changeover to trade denominated in hard currency, we have lost practically all of the ovemight markets that previously were secure. Grain has been removed from the indicative list, and the barrel agree-ments havc been suspended. According to our traders, Hungarian government agencies do not realize how