EASTERN EUROPE: LIMITED ECONOMIC PROSPECTS

Created: 1/9/1980

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EASTERN EUROPE: Limited Economic Prospects

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East Gernan party chief Honecker appeared to retreat froa hieto price stability by implying that price increases are coming under the guise of quality improv^amenta. He attxibuted the inflationary pressure and East Germany's trade deficit with the Nest to price fluctuations in world markets, and warned that dependence on bard currency exports win increase. aMWm

Czechoslovak leaders have cited numerousin the economy, assailing in particular alleged managerial incompetence. Official Czech statements imply that the standard of living will do no more than remain level. Hungarian officials warned that continuedin the balance of trade will require restrictive policies that may prevent any increase in the standard of living for several years. reviously announced adjustment in conaumer prices took effect Monday. Polish leaders have been acknowledging with increasing candor the seriousness of Poland's balanca-of-payv-tnta diand the virtualliat shortages of electric power; meat, and housiirg'wlil persistong time, tfaffe

afiulgasian officialslw u: iwi thai econony, while performing respectably, fell short ofmajor goals. They appear to-have lowered soaiewhat their assasament of Bulgaria's economic prospectsargets, but the nev goals remain In Ronania, the Ceausescu regime has implicitly acknowledged that the ecorvjary is in difficult straits, primarilyesult of shortages of energy and key raw mtcr-als, but hoc not developed suitable remedies,

The East European leaders probably hope that candid discussion of economic: difficulties will reduce popular resentment and perhaps increase the bureaucracy's support for harsh measures. The regimes' task will become even nore complicated as deteriorating US-Soviet relations heighten uncertainty over East European arkets, technology, and financing.

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