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East Germans Slash Prices; Farmers Demand Protection With AM-Germany-Unification, Bjt

May 21, 1990

EAST BERLIN (AP) _ The government slashed prices on everything from blue jeans to television sets Monday in a bid to lure back consumers enamored with Western goods.

Farmers fighting an influx of Western agricultural products loaded their wares onto trucks and rolled in from the countryside to set up stands on East Berlin’s sprawling main square, Alexanderplatz.

Agriculture workers held similar demonstrations in Leipzig, Dresden, Magdeburg and Karl Marx City.

The protests against Western competition came as Parliament debated a state treaty to merge East Germany’s weak socialist economy with West Germany’s powerful free market July 2.

The merger of the economies and social institutions is the key component of full German unification.

Both German parliaments are expected to vote on the pact next month.

Many of East Germany’s state factories and enterprises are expected to shut down when they are forced to compete in a free market, and hundreds of thousands of workers are thought likely to lose their jobs.

In a move to lure back consumers buying the increasingly available Western products, the East German government on Monday put into effect broad price cuts ranging as high as 90 percent on textiles and appliances.

Lines formed at stores throughout East Berlin.

″This sweater cost 50 marks, but I bought it for nine. Look, velour,″ said Jutta Hesse, 62, displaying the violet sweater she bought for a granddaughter.

The East German Commerce and Tourism Ministry said the price cuts would average about 60 percent on a broad variety of consumer goods, according to a report by the government news agency ADN.

Prices for television sets dropped from about $1,818 at the current official exchange rate to $780.

Hundreds of farmers drove in from outlying areas for a festive protest in the capital against the flood of Western products already filling East German grocery stores.

A high school band played on a warm spring day as farmers sold sausages, vegetables and cheeses from makeshift stands in the huge square in the historic heart of old Berlin.

″The farmers need a chance to survive - protect the sale of our products,″ read a banner.

″I have no fear of unemployment because I know we have good quality,″ said Bodo Wellnitz, 28, one of nine employees of a state butcher shop in the city of Strausberg.

″The product is just as good here, but I think there will be much unemployment,″ said Erica Krauzeck, 35, an East Berlin mother of two, as she stood in line to buy cheese.

In another section of town, West Berliner Fredy Dischke sold fruit and vegetables grown in West European countries from a stand on East Berlin’s Leipziger Street.

Farmers are demanding protection from West European food imports that are better packaged and sometimes cheaper than East German goods because of European Economic Community subsidies.

East Germany’s government farm collectives rely on outmoded machinery and often employ too many workers in inefficient distribution systems.

The future of the collectives is still unclear and subject to further negotiations. East German liberals are seeking some job protection for workers in threatened industries.

East Germans began buying Western goods in November, when the former Communist government opened the borders in the face of massive street protests.

The effect has been a steady increase in worker unrest as the threat of unemployment looms. Shoe industry workers have staged frequent strikes to protest what they say is the loss of their market to Western competitors.

The shoe industry last week was the first to announce drastic price cuts.

East Germans often had little incentive to improve quality or work hard under a socialist system in which imports, prices and availability of goods were strictly controlled and jobs were virtually guaranteed.

The Cologne, West Germany-based Institute for German Economy on Monday said a study it conducted showed that 50 percent of East German workers spend on average three hours of their work day doing nothing.

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