EAST GERMANY - WEST GERMANY: MANDATORY CURRENCY EXCHANGE

Created: 10/11/1980

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CASTEST GERMANY: Mandatory Currency Exchange

The surprise Eos: Cermar. announcement yesterday thatsxiors must exchange twice :he foreign currency formerly required anti. severely straw relation ber^een Bonn and Esst Berlin. 'fM%

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The advantageous exchangs rate for west Berliners and the exemptions for pensioners and youths also were abolished. illion visits by West Germans and west Berliners to East Germany occur each year, but the new measures will reduce this travel and are not likely to increase the flow of hard currency to East Germany significantly. The East German action could, however, prompt West German economic retaliation. ftfm

The move reflects the East Germanover conditions in Poland and its desire to.reduce personal contacts with West Germans, which icotential source of subversion. Party leader Honecker' signaled retrenchment in inner-German relations and demon strated solidarity with the Soviets byarsh speech last.Monday condemning the West Germans for "inter ference" in Poland and East Germany. The East Germans have had no humanitarian bargaining chips in recentwith Bonn, and Honecker will probably offer ain the currency exchangeuture summit with Chancellor Schmidt.

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