Soviet Union's Participation in the Agriculture Department's Export Credit Guarantee Programs

GAO discussed the Department of Agriculture's (USDA) export credit guarantee programs and the Soviet Union's participation in those programs. GAO noted that: (1) the Soviets had serious problems in processing, packaging, storing, and distributing their agricultural commodities; (2) USDA developed new credit risk analysis procedures based on consensus risk ratings of major international banks and individual countries' economic, political, and social history as well as their repayment history and ability to access foreign exchange; (3) USDA forwarded risk analyses to the National Advisory Council on International Monetary and Financial Policies, which advised U.S. government agencies involved in making loans; (4) current laws may impede the provision of additional guarantees to the Soviet Union; (5) proposed amendments to current law could tie the programs more closely to foreign policy objectives; and (6) costs would be even higher if the level of outstanding loans and guarantees continued to grow without substantial reduction of the average risk of new guarantees.