European Stars And Stripes (Newspaper) - November 3, 1987, Darmstadt, Hesse                                Tuesday november 3. 19b7 the stars and stripes Page soviets planning to sell cars in . Vow Deal criticized by White House Washington not a plan by the soviet Union to Export Man Litvich cars to the United states with Volks Wagen engines is drawing criticism from the Reagan administration. Under the proposal now being negotiated by Volkswagen Crk . And the Volga automotive works of the soviet Union the West German car manufacturer would build a billion engine Plant in Moscow to produce 250,000 to 300,000 . The engines would Power a special Export Model of the Mosovich 2141. A Froni wheel drive Hatchback that the so Viets expect to sell in the United Stales by i99d. The soviet Union would finance the Plant with Export sales. It is the latest in a series of moves by kit soviets to do More business with the United states and tap More american and Western technology. Whal the soviet Leader Mikhail s. Gorbachev would ideally like to accomplish before he Steps Down from office a decade or two from now is an Economy that produces Industrial products of such Quality that they could compete with those of any other nation said professor Joseph s. Berliner of Brandeis University. An administration official who asked not to be identified objected to the Way the soviet Volkswagen Deal is structured. The american Market ends up financing a German Export to the soviet Union the official said. We gel Noth ing out of  from another department an official who also asked to remain Anonymous commented the United slates does t want to finance anyone s exports car mainly not the germans in Trade with the United Stales West Germany has been running Irac sur pluses second Only to those of Japan. In addition Bonn and Washington arc in conflict Over both West Germany s a Cru Sal to Spur Domestic consumption and its recent credit lightening moves which have contributed to rising interest rates and i Squill on Wall Street. Although the Volkswagen project could swell american Trade deficits there is Little Washington can do to Block in officials acknowledge. They said thai a higher Tariff the soviet s must absorb is unlikely to be much of a deterrent. Because the United states accuses the Soviel Union of human rights violations Moscow docs not qualify for the most favored nation in brilts that the United states applies to Imons from most other countries soviet cars would be assessed a 10 per Cronl Only again so ? percent for Toyota or Volkswagen. On other soviet Mode goods american duties arc prohibitively High. In an earlier attempt by Moscow to enter the american Auto Market the environmental Protection Agency refused to Clear the car s engine. That car was a Lada which is sold in Canada and West Ern Europe. Automotive analysis said the Choice of Volkswagen As the engine maker was in tended o reduce any future environmental objections. The Choice also under scores fast improving commercial tics Between the soviet Union and West Ger Many As their political relationship warms up. A Volkswagen spokesman in Detroit Thomas e. Mcdonald said that the company had conducted negotiations about the engine Plant last year but that those had broken off negotiations resumed in recent weeks he said declining to provide further details. An official at the soviet embassy in Washington declined to comment. Democrats blame White House for pollution woes Bedford