Although the two governments indicated almost identical views on all important international issues, they manifested widely divergent approaches to domestic affairs and, owing to the fact that their economies are not complementary, economic relations between the two countries have not kept pace with political relations. Efforts to increase economic relations resulted in a new five-year trade agreement in 1971 designed to increase the exchange of goods by 128 percent in the period covered. Cooperation between the two states was also demonstrated in the joint construction of the Iron Gate hydroelectric station on the Danube (see ch. 3).

During 1971 the PCR renewed efforts to promote cooperative relations among the Balkan states. The regime emphasized that the geographical isolation and the socialist systems of Albania, Bulgaria, Yugoslavia, and Romania make for common interest in increased economic, political, and cultural cooperation. Observers of Eastern European politics pointed out that Romania shares lengthy borders with Bulgaria, Hungary, and the Soviet Union and that improving relations with the other Balkan states would serve to overcome the country's relative physical isolation.

PCR leaders have also called for all of the Balkan area, including both the communist and the noncommunist states, to be designated a nuclear free zone and for the removal of United States military bases from the area. Observers pointed out that the Ceausescu regime believed that such actions would serve to reduce the strategic significance of Romania in the eyes of the Soviet leaders and possibly result in greater tolerance for Romanian deviation from the Soviet line. Political observers also attributed the growing willingness of Albania and Yugoslavia to increase cooperation and give support to Romania's initiatives for the Balkan area to the growth of Soviet naval power in the Eastern Mediterranean.

The Ceausescu regime successfully cultivated relations with the People's Republic of China and persisted in the development of these relations despite tremendous pressures from the Soviet Union and other Warsaw Pact states. An important byproduct of these relations has been increased economic exchanges between the two countries; in late 1970 the Communist Chinese extended Romania a long-term, interest-free credit amounting to the equivalent of US$244 million.

In June 1971 Ceausescu made a twenty-five day visit to Asia that included nine days in mainland China, the first such visit by a party leader of a Warsaw Pact state since the Sino-Soviet dispute became public. In a joint communiqué the Communist Chinese and Romanian leaders emphasized the necessity of sovereign and equal relations among all communist states and parties. Ceausescu reiterated his government's support for the admission of the People's Republic of China to the United Nations and asserted that the rightful sovereignty over Taiwan belonged to the Peking regime. In August 1971 a Communist Chinese military delegation attended the twenty-seventh anniversary celebrations of the liberation of Romania from Nazi occupation.

Maintenance of friendly relations with the People's Republic of China has also gained the Ceausescu regime support from other communist parties that have been critical of the Soviet Union in its conflict with the Communist Chinese, most notably the French and Italian parties. The PCR has taken special pains to cultivate relations with nonruling communist and workers' parties, efforts that were reflected in visits of top leaders from at least thirty of these parties to Romania during 1970. All of these visitors were received personally by Ceausescu. Observers pointed out that the cultivation of relations with the nonruling parties was an important means of gaining support for Romania's independent policies.

Relations With Noncommunist States

Romania has continued to improve relations with Western nations and has sought to cultivate ties with the developing countries of Africa and Asia. The expansion of relations beyond the Soviet alignment system was cautiously initiated in the mid-1950s by the Gheorghiu-Dej regime when pressures were building for Romania's full economic integration into COMECON. In addition to the desire to develop trade relations with Western nations, the government was interested in utilizing Western technology and in seeking an increased measure of detente in the cold war.

West Germany

In the period that followed the initiation of limited relations with noncommunist states, Romania's resistance to the Soviet Union contributed to a receptive attitude on the part of several Western states. Aside from the gradual development of trade relations, however, significant political relations with Western Europe did not materialize until January 1967, when the Ceausescu regime agreed to establish formal diplomatic relations with West Germany, becoming the first of the Warsaw Pact states, other than the Soviet Union, to do so.