Peaceful Revolution increasingly lacked the materials to continue the arms race with the Reagan-era United States – particularly with a drawn-out war in Afghanistan – and the resources to control Central and Eastern Europe. With his economic and sociopolitical reform program as well as his disarmament initiatives, Gorbachev therefore sought to take appropriate steps. Having initiated a policy of "glasnost" (openness) and emphasized the need for "perestroika" (economic restructuring), Gorbachev essentially permitted the six member states of the Warsaw Pact to now each take their own direction with their own reforms. While those reforms implemented the Soviet Union were met with broad
Foreign trade of the Soviet Union from these countries was resold to the West for hard currency. In the late 1980s, the Soviet Union attempted to increase its exports of nonmilitary goods to these countries. In May 1986, the Soviet Union and Iraq agreed to increase Soviet nonmilitary equipment sales, and in August 1986 an attempt was made to revive Iraqi gas sales. When Mikhail Gorbachev delivered his report on the CPSU's economic policy on June 12, 1985, he noted that growth in exports, particularly machinery and equipment, was slow because the poor quality of Soviet goods prohibited them from being competitive on the world market.