Mr. Donald M. Kendall is Chairman and chief executive officer of PepsiCo Incorporated a multinational corporation which includes Pepsi-Cola company Frito-Lay Wilson sporting goods and Foods International among others. He's also United States co-chairman of the US USSR trade and Economic Council Council formed in 1973 to strengthen trade ties and economic relations between American businessmen in the Soviet Union. Is Longview the Soviet Union is an untapped market for American products? And after many years of laying the groundwork is Company open at Pepsi Cola bottling plant just several months ago and the Soviet Union. He's been personally involved in our process of gaining to taunt with Soviet Union and he claims to spend more time with General Secretary Leonid Brezhnev than any American besides Henry Kissinger in his address Mr. Kendall talked about changes now taking place in the Soviet Union and the importance of trade between our two countries as a basis of peaceful relations and prosperity to talk tonight about the trade opportunities for the Soviet Union and the time for the Soviet Union is as I said, I want to tell you a little bit about the Pepsi Cola vodka Arrangement the Soviet Union, which has attracted a lot of attention. How such a thing could occur? I never touch you on our trade opportunities and then since I probably spent more time with channels like they're Bryson asking anyone with exception of Kissinger. I want to tell you a little bit about my experiences with the general secretary and wife. I feel that the time. Is working at this store. I started back in 1959 when the state department asked us to go to the Soviet Union with an exhibit that we were putting on in Moscow of American products and I came to United States in an exhibit, New York. And that was a time when you were colored then Vice President Nixon went to tell that young and have the famous kitchen debate between the screw shop. Chris you have came by our kiosk where we were dispensing, Pepsi-Cola. I know I had a Pepsi Cola that was made in New York and one that we made there in Moscow and I want him to see if try and prove to him that we could make it just as well in Moscow knowing perfectly well that he would say the one that was made my sky was better. So I guess I'm the one who made a New York and then handing one that we've made right? I must going to the farm. He said it was much better and proceeded to drink about seven of them was a very hot day in August a photographer's were taking pictures like Madden at that time or advertising slogan was be sociable have a Pepsi and they had lines across the United States web with Pro Shop from Lex and drinking a Pepsi cruise ship lines to be sociable. And that was the start of the road to detox. I went back several times after that trying to see if we get our product in the Soviet Union and had no success and obviously wasn't going to until the political climate got better. And of course that occurred during a summit meeting between President Nixon and Tennille sector brushing up on a relationship started. I had a very good friend in a long time since it was our ambassador the Soviet Union who came up with the idea of doing a trade and arrange with ambassador to bring them to communicate our answers before I went to the Soviet Union to head up a business group who was talking to the minister of foreign trade about possible trade between the two countries. I have vacation to meet with prime minister kosygin and fortunately it had the communique that we are interested and I'm at a one night at a reception. What's a game for us? I was called up to the front of the room and I said the Prime Minister want to talk to me and I need said that he understood I wanted to make a spot between there vodka and Pepsi Cola and then he was interested in doing this and wanted it later for later. I said them on later for later. I didn't think we had some ice. What would make a terrific profit? Yonder switch email came back and to show he knew what he was talking about. So I'm talking about later for later, but I'm talking about your concentrate on that basis. He would made it a much better deal but clearly within 15 minutes. We completed our agreement and I'll early negotiated with a prime minister and then took my 6 months to finalize that 15-minute conversation and put it down in and paper but it really is the the heart of I deal with open. They plan up in Andover assessor last may we took our board of directors to the Soviet Union as I thought it would be interesting to have a capless corporation have a directors meeting them and the Soviet Union. We met and made a champagne Winery in outside of no recession. The one thing I'll tell you about the meeting tonight. I'm taking pictures and I'm like I said at the head of the table. Directors meeting I came back. We had a compensation committee meeting out in the hall and I came back and the chairs of beer are rearranged and I was sitting in the middle. There was a photographer across taking pictures as we were starting the main and I still didn't realize what was going on until I turned around and realize what they were doing. They were photographing. I bought a directors meeting in front of Lenin's Lennon's picture. Now why could this sort of thing occur after all Pensacola has no technology and technology and I think it's a very interesting story that this type of thinking could occur on until some of the change in the political climate and obviously they the first being Lee Summit made him. I think it's a true sign that the Soviets have changed their priorities. The Salvation changing and trying to sell communism around the world. Have not really been very successful. And it really hasn't done very much for the wrong people. You take what happened the name and the Middle East the money that they spent the Arab countries. They really haven't converted anybody with possible exception of summon Siri. I'm coming in Iraq, and it's been very expensive. their experience in Cuba Kasam about a billion dollars a day. And really has not done anything for the people in their country. And if you recall we were trying to go around the world and I'm spread democracy throughout the world and we were ready to fight for it at the drop of a hat. And that's how we got into the Vietnam. That's how we send our troops into the Dominican Republic. That's how we send our troops and 11 on. Until they Guam Announcement by President Nixon where I changed our priorities and said that we were not going to get involved in this type of activity. The Soviets then change their policy in my opinion. And I think I can demonstrate to you how they they have changed their their policy to meet that. I think one of the pros of that is chili. Anyone know knows anything about the situation in Chile knows that I am they would have stayed in power. If the Soviet Union had decided to give the economic and military aid to the Chileans because it would have been a very simple thing due to do but he did not give this a lot of support that gave Castro and that's why I am day is is out of the boat. And chili but I think it's a change of policy. I think the other thing that has changed is a pay raise military party. There is no question. But what the Soviet Union today has equal military strength with the United States. Now you can get them big arguments in this country about the salt talks about the agreement that President Ford made and it's who has the biggest trust and who can give the most to me. It's a rather silly argument, but they have more depressed and whether we have more accurate muscles because either one of us have enough time to make bombs to kill the majority of our population and I don't think it makes any difference between kill us once or twice. So it's a rather silly argument. And the agreement that President Ford made which most people don't realize the Soviet actually had the lower the number of missiles that they already have we have room to go up and they have to actually come down. I'll course the technicians will will tell you yes, but they have more thrust. So when I murder if they can barely send out more than then we can but I think they're as long as they have power there going to proceed with the time. They have great fear of War. That's a country where 21 million people were killed in World War II. And their Manpower was knocked out and and many villages and they in the Soviet Union today. For those of you who've traveled you notice that they have War memorials all over the country as a Church's of disappeared the people go to war memorials and it's almost become like a church. People get married and they go to the church and put flowers on the memorials the same as someone would probably go to church here in the United States. So they fear of Juarez continued with a younger generation. If you go back to their history, they've been invaded Time After Time After Time. So then I don't think there's any question what the people in the Soviet Union don't want war. The only thing that's happened is that they've got an extremely good job in educating our people. and when you educate people there, Verizon's expanding their demands increase The no longer satisfied with what they have before. And I pay by myself at Union can understand you're having a better suit than they have. They can understand you're having a better car than I have. But they got very upset when they find a pole or a Hungarian or a check or Romanian what has a better suit and a better car than they have. I'm they like we've been supplying the military umbrella over the coming, countries like we have over much of the world and it's not a great deal of our money and I spent a great deal of theirs on heavy industry on military instead of doing things for there are people And they've got tremendous consumer demand today. And in my opinion if they do not do something to meet that demand. They're going to have the same kind of problems that Poland had and that hungry have so I think that's another reason that we can look at the at the changes. Today they have much better housing in the Soviet Union a thing that you must do when you go there and I'm sure some of you've been there is don't try and compared to the United States. Because there's no other place in the world like the United States what you have to do is compared to what they had before. And if you've been there 15 years ago, or if you've been there ten years ago or even six or seven years ago, you'll find that they made tremendous improvements and their living conditions. Because of a pressure of the consumer they are even selling what we would call kind of minions there people before that. You got so many square meters per member of the family now, you can go beyond that. Even travel around the country is Nevis a hydrofoil where people have gotten together and bought hydrofoils if they go on the rivers and unlikes with you go to their vacation resorts and I think again, you'll see the tremendous demand of their people for new things and and activities that we have enough known for many years in this country, but there is a still a tremendous Lac. the things that they want Looking at our opportunities. Let's look at it from our point of point of view. I think the Soviet Union can end up probably being one of the biggest trading partners that we have. With the possible exception of Canada. Some of the things have been happening in Canada and race them their relationship with us and our commercial relationships that we may even have difficulties there. Because they have done so little for their consumers and we've done so much for us. We've developed Distribution Systems. We've developed automation food processing. That they are just now coming into that. Trouble. I took Minister line, for example of the who's in charge of all food production the Soviet Union and his food ministers in the major republics on a two-week trial the United States. I'll tell you when I trip was over Minister Lane. If you'd have the money would have bought everything that he saw. Because we've solved the problems that they now have and they have a shortage of Labor. There's no unemployment the Soviet Union there's a shortage of Labor so they must automate and they need us to help do that, but they don't need it. So bad that they'll do some of the things that our Congress has a suggestion. People get concerned about the transfer of Technology. Well, I don't think we should transfer our latest computer. So them are things that we know are going to be used for military benefit. But we have an awful lot of things in this country that we can sell it or not Grand of increase their military capabilities. And I also think that the policy that we've had in the past during the Cold War has not stopped at capability. Because we have isolated them. If they've got the capability to parody with us, so I think if they make up their minds to do something that they probably are going to do it. One of the examples I love the site is titanium. For years. I got my had a policy that we couldn't sell the Soviet Union titanium. Today our biggest source of titanium is the Soviet Union. They're selling it to us now. We think in the United States that we invented everything. Let me give you a few examples a lot of people think the diesel engine for example was invented in Germany not the United States radar was invented in England. Not the United States the knitting machine. It's wonderful. Double triple net suit said I'm sure you saw on your stars that machine was developed in Italy. I'm England the switch witch advanstar telephone system. Was made him and Sweden wasn't developed by Bell. Telephone was developed in Sweden. The Soviets have a lot of technology that we can use in this country for example in the transfer of electricity on on high power transfer transfer a long distance. They're about 50% more efficient than we are there ahead of us and breeder reactors. They're ahead of us in cancer research. They're ahead of us in many mining techniques, which are companies are already paying licensing fees for So they do have technology that we can get. now, let's look at late event that occurred in January for the Soviets renounce they Trade Agreement since the 1972 agreement was signed by townsite there Vice President Nixon. Our Congress has been trying to direct foreign policy. and in all due respect to our Democratic governor we've had about 16. Well, the table Herriman called him. He said the trouble of the democratic party. I've got 16 vice presidential candidates and no presidential candidate. But anyway, they've been about 16. I'm running for president trying to outdo the other. I know I Constitution it says that the executive shall direct foreign policy with consent of Congress. But the word consent hasn't been very well to find. And I'm afraid that wearing a price. On our country where we do not have the leadership. That's going to take over and I'm give us a foreign policy Direction and that's what happened to the trade bill because it got mixed up in politics. I can tell you that the Soviet Union is not concerned about credit. So why most people think they are? Let me tell you why they have about 8 billion dollars in credits already from people want to sell them. The French have given them 2.8 billion dollars in credits. Incidentally France has a GNP about the size of California. And as you know, we've given them three hundred million, Japan has given 1.2 billion dollars in and credits. Germany is giving 1.5 billion dollars in credit the UK has just given two billion dollars in credit. Sweetness gave him a hundred million dollars and last Saturday the Italians gave him seven hundred million dollars. And we've offered him three hundred man. But it's not going to stop the short-term. Pray. What's going to happen? Is that work on those jobs in the United States? And the United States is going to end up sitting on the sidelines. While the jobs that could have been here in the United States are going to Germany to France. until Japan until England and to Italy there was one contract already for 250 million dollars, but an American multinational company. 47 Lane is going to be made in the United States because they don't have the credits. The rest is going to be made in France and Germany. There's another project for an ammonia plant a four hundred million dollars. An American company is supplying all the technology. If the credits are being supplied by the Japanese and the jobs are going to Japan. I had lunch today with the Ambassador from Bulgaria. And he told me a very interesting thing. He said we're developing a 5 year plan. And we've got to decide this year where those projects what country were going to develop them with these are big plans. He said I have foreign minister. Said that you should drink water. at the spring knock down the pipe or down the river. You should go to the spring. I need fails at the spring is in the United States. And he doesn't want to get this equipment from Japan which is at the end of the pipeline because the Japanese are getting a lot of the technology that we have in this country in America and how to produce is ammonia planning and in Japan they want to buy it here. But they're going to set their plan this year and if they don't have in Bulgaria credits and most favored nation, they're going to have to buy it on these other countries. No jobs are going to go there. We had an unbelievable opportunity because Bulgaria traditionally trade with Germany. But they wanted to come here. And this is true of any of the other Eastern European countries, and I think that if we don't change but Congress has undone. They were going to end up on the sidelines. Let me tell you what credit will do. If you give 2 billion dollars of credit for the Soviet Union or the Eastern European countries actually 33% SO2 band and credit get you six billion dollars in sales. The Commerce Department says for every $15,000 and exports you get one American job. I think that figures lost a let's put it up to $25,000 for every job. 2 billion dollars in credit six billion dollars in sales get you 240,000 jobs. And we need experts in this country where no longer a nation that can put a white picket fence up around our country and say that we're not going to trade with the rest of the world because if we do that, we're not going to enjoy the lifestyle that we've become accustomed to and there's no way we can do it. We need the trade. Now it's look at. at daytime I don't care. What do you call a date and improved relations or what you want to call it? But it's a fact and it is happening and let me give you two examples of steak Cypress. for the first time in many years the United States stayed out of it and the Soviet Union stayed out of it. And if you'd rather depressing this country the time of Cypress occurred. One week they were blaming the Greeks and next week. They were blaming the trucks. I would have been difficult to choose which side that you want to just wanted to support. But the fact is we stayed out of it in the Middle East. The Yom Kippur War I was stopped because of the help of the Soviet Union unless we call the facts. Prime minister kosygin went to Cairo and negotiated with so that he flew back to Moscow Kissinger went to Moscow and meth with with kosygin and brush now and that's where the agreement was made on the ceasefire. He then food as well in the war stopped. Now, let's look at the negotiations on his first shuttle diplomacy. He got agreements and everywhere except Syria. Before he got the final agreement in Syria. A photo Geneva and met with girl Mako and then went to Syria and for a Mako had just been in Syria and that's when they agreement was made. And if the Soviets had them help. The war would not have stopped until one side of the other gave up. So I think the Soviets are serious about the taunt. I think we should keep our defenses strong. But I think we should proceed on that course as rapidly as Cannon as prudent as we can. Let's look at the man right now. I think fresh snap has ever his whole political career on relationships of the West. For those of you who follow the Soviet Union you probably heard of chaplain. It was the head of the KGB at one time. We was now out of the politburo. He was one of the man who was not for a lady taunt as I understand it and there was constant trouble in the plug girl. Chef Lin is now out of there. a vape that leadership group and I think the price enough is still in charge and will remain in charge and he spends unbelievable time. I'm trying to find ways to improve their likes your business man. Go over there and talk to him our Congressman go over any talks to him or Senators. He goes over and they talked to him. I spent literally hours with him. He's not a difficult man. Understand. He's not someone when you talk to him, but you leave the room and you wonder what he said. You know what he said, you know what he what he meant by he's Is the medicine is an open book? Now they're things in that society that I don't like it that you don't like it that we're never going to like. But I don't think that I'm in fact, I think we've all learned that we can't go around making the world in the enemies that we would like it. And I'll tell you that in my opinion. You don't change people by isolating them you change people by having intercourse Commerce back and forth and buy tourism going back and forth bar people talking to their people are people in the United States going over there and talking to them. That's how you change people. That's how you develop trust. It's not by drawing an iron curtain and isolating them. And I don't understand in this country. How we can have a united front and our foreign relations between the Democratic and republic party in time of War we all get together in our foreign policy or argument stop at the water's edge. But when we're seeking something, that's the most important thing you can have in the world and much more important War when your seeking peace. Then we can't get together and have a United foreign policy. And I think it's a little stupid. Because peace is a hell of a lot more important than War. What are the danger? The dangers are that if we let this go by. If we don't proceed on this course of trying to find a way to get together. And we push too hard. I need leadership in the Soviet Union that believes in and filled relationship to the West. is out in my opinion and I think secretary Kissinger said this numerous times. But wait for another generation. Before we can start this and we'll be back in the Cold War. It's a lot better to talk. I have tourism and have trade. And the setback a nice lady chowder. and throw bombs at one another In my opinion there can be no peaceful International order without a constructive relationship. between the United States and the Soviet Union there will be no International stability. Unless both the Soviet Union. And the United States conduct themselves with restraint. And unless they use their enormous power. for the benefit of mankind And I'm closing. I would like to say what President Eisenhower pointed out two decades ago. There is no longer any alternative to peace. Thank you very much.