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2 -- Relative internal liberalization as expressed in a willingness to observe internationally recognized human rights and a degree of pluralism and decentrali- zation in the political and economic spheres. 1st 3. The balance sheet of "differentiation" an analysis of the past and current policies of "differentiation" by the U.S. and its Allies, with an assessment of the positive and negative results for U.S. policy in the region, U.S. relations with its Allies, and their impact on U.S. -Soviet relations. 1ST 4. Instruments for implementing differentiation: The review will indicate the means which the United States can use to reward countries that meet its criteria and withhold rewards from those that do not. A. Economic : an analysis of such instruments as MFN (annual and multi-annual) - credits, IMF membership, concessional sales of foodstuffs, rescheduling of overdue loans, and technology transfer. B. Cultural: scholarly and scientific exchanges, and the nature of information beamed to a given country. C. Political: high level visits, activities in international fora (e.g., CSCE and the United Nations), and restrictions on consular and diplomatic personnel. ts) The study will establish U.S. policy toward Eastern Europe and provide basic policy guidance for other studies of matters dealing with the region. (s) 5. Allied cooperation: What needs to be done to secure maximum Allied cooperation in the pursuit of our policies. 1st 6. Regional aspects: An analysis of the individual countries of Eastern Europe -- Poland, East Germany, Czechoslovakia, Hungary, Romania, Bulgaria -- with a view to determining to what extent they meet our criteria, where they seem to be heading, and what specific issues in their relations with the United States and the Western Alliance are likely to come up in the years immediately ahead that will bear on the policy of differentiation. U.S. policy toward Yugoslavia and Albania will also be treated, but in a separate context. ss Administration Management of the NSSD 5-82 review will be the responsibility of an interagency review group that will report its findings not later than April 30, 1982. The review group will be chaired by the Department of State and will include Assistant Secretary-level representation from the National Security Council staff, the Department of Defense, the Central Intelligence Agency, the Joint Chiefs of Staff, the Treasury Department, the Department of Commerce, the International Communication Agency, and the Department of Agriculture. UNCLASSIFIED