THE HAZARDS OF SOVIET BUSINESS

Oil companies seeking opportunities in the Soviet Union escaped calamity last week. President Bush, with support from U.S. allies, declined to cancel trade talks with the Soviet Union in retaliation for Moscow's economic embargo of Lithuania. For many reasons-among them the need for a trade pact affording some legal framework for business conduct in the U.S.S.R.-Bush made the proper call. And his handling of the matter offers a lesson to western companies certain to face Soviet crises of their own.

From the Lithuanian viewpoint, Bush's decision looks like a sellout. Critics say the President should have defended the cause of freedom no matter what. But harsh U.S. response based on that position would have threatened the processes that emboldened Lithuanians to assert their independence in the first place.

PROCESSES SLOW

Those now familiar processes-perestroika, glasnost, and demokratizatsia-don't move at speeds western governments might prefer. Nor will they progress without flaw. Bullying of Lithuania is a huge flaw, but it's not a reason to chill the energies of Soviet change. The U.S. can disapprove without derailing trade talks and spoiling relations. A failed system will blunder even as it tries to outgrow its failures.

That holds true in commerce as well as politics. Perestroika, glasnost, and demokratizatsia aren't all that's slow in the U.S.S.R. Nothing in the country happens quickly. Often, nothing happens at all when action requires cooperation between monolithic agencies.

And a sluggish bureaucracy is just one problem. Convertibility of rubles and repatriation of profits remain in question. Basic business laws don't exist. Investment information is scarce. Communications and transportation networks are poor. Furthermore, foreign companies must form joint ventures with Soviet enterprises unaccustomed to western practices. The Soviets understand little about shareholder claims. They don't know how boards of directors work. They use a cash accounting system concerned least with profits and most with progress toward state production goals.

These complications didn't daunt the companies that have formed 1,300 joint ventures in the U.S.S.R. since 1986 or those-including oil companies and service and supply firms negotiating joint ventures now. The petroleum industry attraction makes particular sense. Western companies offer technology and equipment the Soviets need. The Soviets offer an oil and gas resource unmatched outside the Middle East and an enormous market for supplies and services.

So companies see good reason to probe the Soviet business frontier in spite of its legal, economic, and political hazards. Their prospects hinge on touchy superpower relations, which can crumble with one misstep in a crisis like that over Lithuania. Bush might have canceled this week's trade negotiations. The Soviets might have retaliated by slamming the door on joint ventures.

OTHER CLOSE CALLS

There will be other close calls before Westerners and the Soviets learn to deal comfortably with one another in commerce and diplomacy. Some will involve individual companies. Some will involve whole governments and industries. All will fray nerves. They probably will keep profits elusive for years.

Companies considering Soviet ventures should understand the risks. They must commit capital and personnel for the long, uncertain term. Bush demonstrated how business must be conducted within the lumbering, changing Soviet system: with patience. At this early stage, rewards-profits for companies, lasting freedom and prosperity for eastern peoples-appear to justify the wait.