MSTORICAL^fEWPROGWM feLEASEAS SANITIZED
DIRECTORATE OF INTELLIGENCE
ORGANIZATION OF SOVIET FOREICN MILITARY AND ECONOMIC AID
of Political Research
of Strategic Res-arc
of Economic Research
CIA HISTORICAL REVIEW PROGRAM RELEASE AS
E7 IMPOET PRb
SYNOPSIS
This synopsis}
^jtocuscs on cnc institutional mechanisms which
oreign sid in both ics militaryri:
It does not attempt to show how Soviet aid projects evolved and are administered in all the various recipient countries around the world, although the history of military aid in Egypt is briefly treated. Rather, it tries ro demonstrate how the program's dynamics create pressures for and against extendingdriving the program, others forcing its reduction or redirection.
The study's principal conclu* .ons ire:
Structured hierarchically, the political system forces the resolution of all important aid issues at the very top,mall number of leaders at the Politburo level. Independent decision-making at the lower levels is limited to execution of aid policies.
The implementationconomic and military aid, however, isvervised by krowledgcable and experienced bureaucrats whose advice and actions canonsiderable influence on the decisions of the less informed
" Aid policies and programs, by the very nature of the system, are subject to the conflicting goals, biases, and rivalries of numerous Soviet institutions and individuals,
" Soviet leaders give more emphasis to military than economic aid, evidentlyreater payoff from the former in achieving and reinforcing political goals. igh
degree of bureaucratic insularity andgive added impetuse military-aid program,
The record indicates that the present regime will continue its prajmmic approach to the utility of economic and, especially, nilitary aid, seeking targets of opportunity that promise, above ail, some political leverage in key LDCs and, where possible, some relief or boost In Soviet economic sectors of strategic significance.
THE INSTITUTIONAL FRAMEWORK
An easential feature of the Soviet aid program, which is its useolitical and strategic weapon, is underscored by the tact that all of its major directions are determined by the Party Politburo. Foreign-aid matters come onto the agenda of formal Politburo sessions mostly in the context of larger policyexample,iscussion of the domestic and international priorities implicitraft five-year plan, or when major international developments, such as the Middle East wars, force immediate aid decisions.
At the aame time, the representative structure andof the Politburo allow vested interests to find expression in its deliberations and policy formulations. Host dsv-to-day decisions on economic aid probably are reached informally through the aechanism of the Party Secretariat an. Central Committee departments; in the case of military aid, the Defense Ministry's General Staff appeara to servo an analogousfunction, linking the various defense components and the Defense Council.
Within limits imposed by general foreign-policy andgoals, significant influence may be exerted on economic
aid in high-level negotiations by the head* of the three main bureaucratic sectors--Party General Secretary Brethnev,Premier Kosygin, and state Presidenton military aid, additionally by the Defense Minister.
ower level of the aid hierarchy ia the government Council of Ministers, which has extensive managerial authority for all areas of the economy. Subordinate to Premier Kosygin and hia first deputy, Mazurovolitburore at least four administrative bodies which, to some degree,the actual shape of Soviet aid programs:
The Commission for Foreign Economic Questions .. (FEC); i
The Military-Industrial Commission (VPK);
The Commission for CEMA affairs;
The State Planning Committee (Gosplan).
All four organizations are responsible for coordinating aspects of foreign-economic activity conducted by ministries and other government agenciea and enterprises.
The most important of the government's supra-ministerial commissions in the field of foreign aid ia the FEC. Thehistory of involvement in bureaucratic politicsIts importance. Its current chairman has career ties to Brezhnev.
Finally,hird level of significance in aidare Che government agencies which actually administer aspects of the aid program. These institutions, because of their bureaucratic roison d'etre, would have the greatest vestedin continuing and increasing the momentum of aid programs.
OPERATIONAL PROCEDURES
The process by_which Soviet foreign aid if implementedun-Or^tood The
State Committee tor Foreign Economic Relationsrt re-apomible for administering all economic aid under the super-viaion ot the FEC. The Hinlstry of Foreign Affairs appears to have no reel influence in aid decision-making, except such as Foreign Minister Cromyko might exert in Politburo discussions of aid policy. Military aid is administeredKES deputy chairman and two directorates--the Chief) and the Chief Technical Directoratehich actually function as arms of the General Staff andh Directorate. There la little if any cross-over from either the economic or military sector'into the other's uctll channels, which run vertically to the senior decision-makers. The CKES chairman administers economic-aid programs through the FEC, and the CKES deputy chairman for military aid is accountable to the Ceneral Staff.
Economic Aid
Established operational procedures put CKESosition to exert significant influence on economic-aid programs, in particular on the amounts of aid to be provided. The top officials of CKESide array of administrative and technical expertise which the senior policymakers requireasis for tormulatlng both preliminary negotiating positions and draft agreements with recipient countries. CKES officials also include planning specialists who draft the economic-aid section of the annual and five-year national economic pinna. Although these plans and any major agreements require the approval of the Central Committee apparatus and the Politburo, the expertise ot CKEE officials gives them an advantage which they can use to influence the size of various economic-aid programs. Foreign trade associations, the CKES units which bear the brunt of day-to-day implementation of economic aid, are even allowed to negotiate short-term credits (up to five
-4-
yean* duration) within the limits of existing agreementsobtaining approval from the Central Committer apparatus. One constraint on GKES Is the need to coordinate planning of aid allocations with other agencies, notably Cosplan, which haveto higher authorities in cases of disagreement. Gosplan, with its tendency to apply fairly strict economic criteria to aid programs, evidently acts in practiceheck on CKES,
Military Aid
It is the responsibility of the Generalhto prepare studies and proposals in support of preliminary military-aid negotiations and agreements with recipient countries and to draft the military-aid section of the national economic plans. Presumably,h Directorate forwards its recommendations by strict military chain-of-commind to the Defense Minister, who personally submits them to the Politburo, This procedure,inimum of non-military input, would give the military-aid experts the same kind of leverage to bolster their programs as the GKES officials have in regard to economic aid.
Military aid, with its large potential benefits and risks, is more highly politicized than eccnomic aid. Perhaps inof the fact that military programs seem to build greater momentum and are more difficult to slow down or reverse than the economic programs, Politburo approval is required at each stage of the negotiating process, Ic normally consists of fourstages, establishing an increasingly explicit commitment while providing Soviet negotiators opportunities to reduce or heighten the level of their involvement:
First, political discussions at the highest level resultoviet agreement in principle to provide military aid, and the client signs an "intent to purchase" statement,
Second, discussions at the workingeneral Agreement, which defines the procedural and administrative ajpects ofd'project.
T
roject Requirements Document states the specific services and equipment to be offered. Although at this stage the client has become locked into the process, thenay lay the basis for additional projects unanticipated by the client or reduce the level of Soviet assistance, even to the extent of violating the spirit of the preliminary understandings,
Finally, individual purchase contracts must be negotiated for each of the items of equipment and services needed to complete the aid project.
While these operational procedures appear designed to give Soviet
negotiators flexibility, they also require rigid uniformity and
considerable time. esult, the entire military-aid program
is characterized by significant bureaucratic inertia, which
tends to create pressures for rather than against the program's perpetuat ion.
The actual administration of military-aid projects creates the same kind of pressures. Host significant projects require the assignment of Soviet military advisory groups (HACs) to the host eouotry, ostensibly to oversee initiation and maintenance of the projects and Co offer military advice and combat support. At the same lime, the use of NAGs offers Che USSR important additional advanCages:
visible Soviet presence in the host country;
entree to what is the primary locus of power in many LDCs, the military establishment;
A base for Soviet intelligence operations.
In addition, the setting up of logistics systems in support of aid projects, by enabling the USSR to withhold and manipulate
the supply of operational necessities, haseans of pressuring clients in political matters. No doubt theof such levers in the HAG and logistics systems isempting incentive for Soviet decision-makers to establish military-aid projects in susceptible LDCs.
PRESSURES FOR AND AGAINST EXTENDINC AID
The choices facing Soviet decision-makers -re, in general, made against the frequently contrasting claims of politics or ideology, on the one hand, and economics, on the other. Party officials tend to give priority to political considerations, while government administrators normally give precedence to hard-headed calculations of economic cost. Deviations from thiscan be found, however, in Party and government institutions alike, and the process by which the Politburo leaders receive information and advice on foreign aid is complicated by the fact that the institutions which provide them may embrace differing or competing points of view.
The case of military aid to the Arabs, for example, reveals crosscurrents within the Defense Ministry. There are, of course, grounds for divergence in outlook generally between the General Staff planners, who are accustomed to thinking in terras of both broad strategic implications and cost-effectiveness, and the service chiefs with their operational orientation and possibly greater interest in finding opportunities to test equipment and combat methods on "neutral" ground, Ir. any case. General Staff recommendations on aid1 probably tended to be cautious, reflecting the views of its independent-minded chief, Karshal Zakharov. Since then, however, the General Staff has been headedormer MAG chief who enjoys Brezhnev's favor and who mayore openhanded approach to military aid.
The recently deceased Defense Minister Grechkq himself was perhaps stronger than his chief of staff in his advocacy of military support for the Arabs. Afterolitburo
memberhe Marshaluch greater opportunity lo influence the shape of military-aid program! and evidently cried to gain direct control over che military-aid function ac the expense ofGeneral Staff. Bureaucracic jockeying for contrcl over this function could have reaulcedeas than unified Ministry position on military aid. Grechko's replacement, the civilian Ustinov, may be forced to rely more on the General Staff for aid advice and support.
The flow of the decision-making process for economic aid is subject to even stronger crosacurrencs and,esult, is even more likely co result in lowest-common-denominator Someexample, the Ministry of Foreign Trade, Cosplan, and industrial ministries which are involved in support of aidCo give preference Co trade on the grounds that it, unlike aid,rofit. The economic argument aicjinst aid aa being wasteful or unprofitable prevails among the general Soviet public and even is encounc-ered in educated and official circles, including ports of the military establishment.
Differing emphase* can be foundchin the two Party institutions which directly advist the Politburo on foreign policy. Although the a* departments appear totrong vested interest in promoting Soviet political-ideological goals by every means, including aid, officials and academic specialists associated with them express opinions whichairly broad spectrum of sophisticated and realistic political and economic approaches.
The approach of officials in the Department for Liaison with Comnunisc and Workers' Parties in Socialise Countries (the so-called Bloc Depirtnwnt) appears based on the premise that an improved Soviet strategic positionore vigorous aid an]icy on the part of the Bloc. They seem especially inceresced in providing economic aid aimed ac developing fuel resources within Che LDCs for exporc Co CEMA countries, as well as for che internal consumption o; these councries. This approach ia shared by che foreign-economic planners in Cosplan, who appear
to favor coordinating CEMA plans with the LUCa in the area of facl and rw materials ino ease the burden of heavy capital investments In Soviet extractive industries.
By contraat, the International Departmentore reserved poset suggesting that the social and political ills of the LDCs can vitiate ine utility of Soviet aid. There teems toonsensus among International Department specialists that themust develop their economies gradually, avoiding jverly ambitious plans. Indeed, some of these specialists come close to calling into question the general usefulness ofaid, arguing that it is more important for Soviet policy to focus on the political and social probltm* of LOCs. The implications of such sober assessments are fairly obvious: foreign aid should he relatively modest in scop', and aims.
Onho advice emanating from these various sources appears to be weiK**ced on the more sober and pragmatic side. The record of Soviet aid in the past decade indicates that aid policy is, in fact, basedealthy pragmatism which tries to take advantage of targets of opportunity that promise to enhance the Soviet position in key LDCs and geographic regions. The goal ofignificant economic payoff. In the fuel and extractive industries or elsewhere, appears clearly subordinate to the political goal.
PERCEPTIONS OF EXTERNAL AND STRATEGIC COALS
However much the recommendations of various Sovietand specialists enter into the thinking of Politburo members, there is evidence that they can and usually do make their decisions on the basin of an evaluation of broad national interests. Even when an individual Politburo member has qualms about the economic costs of foreign aid, he is likely to perceive the political value of aid programs quite clearly and to consider this the overriding factor. Indeed, Soviet aid programs appear to be shaped by both optimism and opportunisme Politburo
loaders4 perceptions of how the USSR can and should behavereet power. Deriving added strength from rite belief that in recent year* the strategic balance has shitted 'avor of the Soviet aioc, Soviet policy-makers seem to feel that time and patience will eventuallyayoff from most foreign aid.
It seems that, because of the many institutional interests involved and the various crosscurrents which have been alluded to, there is no exact correlation jetween the USSR's aid progrcra .ind the general direction of its foieign policy. Neve* cheless, the degree to which emphasis should be placed on detente or on support tor "liberation movements" undoubtedlyignificant influence on the thrust of the aid program.
Original document.
Comment about this article, ask questions, or add new information about this topic: