NOVOROSSIISK, Southern Russia -- In the middle of the Cold War, when Soviet propaganda insisted that the great achievements of the socialist economy would ultimately outshine the "rotting capitalist market," Yevdokiya Banko went to work for the enemy.


In the summer of 1974, Banko and her fellow workers in the Black Sea port of Novorossiisk, famed for its champagne and high quality cement, turned out the Soviet Union's first bottle of Pepsi-Cola.


At the time, Pepsi was the only Western consumer product available in Russia. Ordinary Russians earning 100 rubles a month operated the Novo-rossiisk Pepsi plant's Western equipment and -- something unheard of in the 1970s -- actually met foreigners.


"It was like a window to a different world," recalls Banko, 43, one of the four longest-serving Pepsi-Novorossiisk employees.


"I was young and I remember vividly the Austrian engineers who'd come over to install equipment and train us. The competition for a job at the factory was very tough -- not because of salary, which was the same as usual, but because it was a matter of prestige."


VIPs of the socialist world frequently visited the factory to marvel at its neat and efficient production. Leonid Brezhnev himself paid a visit in 1974, duly recorded in the factory's guest book.


"It was a pleasure to see this modern, well-organized factory, which works for the welfare of the Soviet people," the Soviet leader wrote.


The first seed for Pepsi's entry to Russia was planted as early as 1959, when PepsiCo international chairman Donald Kendall met Nikita Khrushchev during a visit to Russia by U.S. Vice President Richard Nixon. According to PepsiCo officials, Khrushchev downed five bottles of Pepsi in a row.


Later, Brezhnev played a major role in making Pepsi's Novorossiisk project possible by authorizing the Pepsi-for-Stolichnaya deal, in which Pepsi marketed Russian vodka in the United States and Russia used the hard currency earnings to purchase Pepsi concentrate.


Apart from enabling ordinary Russians to drink Pepsi, the deal gave PepsiCo a huge head start on the Russian market, where it now has 20 franchised bottling plants.But today, neither Pepsi nor the Novorossiisk plant are as unique in Russia as they were. The Coca-Cola Co., which entered the market in 1991, has already opened its first fully owned plant near Moscow to produce Coke, Fanta and Sprite, and claims that its sales have reached about half of Pepsi's.


Output at the Novorossiisk plant, which produces Pepsi under license, has fallen to 90,000 bottles a day from a record 300,000 in the 1980s, a fact that factory director Vitaly Shikhman attributes to general economic decline and growing competition on the Russian soft drink market. The plant, renamed the joint-stock company Pino, is now known more for its beer than for its Pepsi, and also produces mineral water.


Ironically, one of Pepsi's problems in Russia is that locals no longer see it as a Western product, and have thus lost interest.


"It's been here forever and no one considers it a foreign product any more," said Yury Mosha, a Novorossiisk television journalist.


In response, Pepsi has sought to freshen up its image, and plans to shift from a network of franchised plants to joint ventures to obtain better control over marketing.


"When it is a franchised plant, we only sell them our concentrate, equipment and technology, but have no influence on their marketing and sales strategies," said Yuliya Baunova, marketing manager at Pepsi-Cola International in Moscow. "Participation in a joint venture will give us much more control."


Pino's managers said that they still consider PepsiCo their principal partner, and expressed hope that a preliminary joint venture agreement already signed with the soft drink giant will mean another milestone for the Novorossiisk plant: the first Russian-produced can of Pepsi.


"We are counting very much on the deal," said Shikhman, the Pino director. "I'm sure that canned Pepsi will be very successful."