THE PRESIDENT'S DAILY BRIEF 17 AUGUST 1971

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0005992809
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 8
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: August 17, 1971

Declassified in Part - Sanitized Copy Approved for Release 2016/06/14 : CIA-RDP79T00936A009800140001-4
The President's Daily Brief
17 August 1971
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FOR THE PRESIDENT ONLY
THE PRESIDENT'S DAILY BRIEF
17 August 1971
PRINCIPAL DEVELOPMENTS
Reactions to the new US economic policies are dis-
cussed on Page 1,
Lon Nol's government is seeking to reduce the South
Vietnamese presence in Cambodia. (Page 2)
Fragmentary reporting shows that the Bengali insur-
gency is persisting in East Pakistan. (Page 3)
}Chinese\
(Page 4)
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INTERNATIONAL ECONOMIC DEVELOPMENTS
The new US economic policies have been greeted
with equanimity by most foreign government officials,
but foreign businessmen are showing concern. Japa-
nese leaders voiced surprise at the moves even though
admitting that they had been expecting some action.
Press reports indicate understanding ?of the US eco-
nomic situation and an inclination to be helpful.
Officials noted approvingly that the US actions were
not aimed at any particular country. Businessmen,
however, expressed their concern over the impact on
the international monetary mechanism and a possible
revival of trade curbs. Comment elsewhere, although
sketchy, was along similar lines.
Suspension of the dollar-gold convertibility
has led to the temporary closing of nearly all major
industrialized countries' foreign exchanges and gold
markets yesterday. The notable exception was Japan,
where the Bank of Japan refused to allow the dollar
to float, absorbing over $600 million yesterday and
$300 million more thus far today as it continued to
support the yen-dollar parity. Meanwhile, Tokyo's
stock market continues to register a sharp decline,
apparently in anticipation of lost export opportuni-
ties in the US.
Most major exchange markets will be closed again
today as officials discuss what actions to take.
Treasury Under Secretary Volcker's meeting in London
yesterday with his European financial counterparts
is to be followed by a European Community (EC) Mone-
tary Committee meeting in Brussels today.
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Moscow's reaction thus far has been mechanical,
branding the situation as a "deep crisis of American
capitalism" with a "cure" to be administered "at
the expense of the working people."
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Kompang Cham
VINH EACH GIA
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CAMBODIA - SOUTH VIETNAM
The Lon Nol government is calling for a re-
duction of the South Vietnamese presence
in Cambodia in an effort to demonstrate its
military self-reliance and to reduce the
likelihood of further depredations by South
Vietnamese forces.
The Cambodian Navy plans on 1 September to re-
place the South Vietnamese Navy in escorting and pro-
tecting all ship convoys on the* Mekong River from
Cambodia's border with South Vietnam to Phnom Penh.
The plan is counter to the recommendations of South
Vietnamese and US officials, who have suggested the
take-over take place gradually over a period of time.
Phnom Penh has also formally requested that the South
Vietnamese vacate their major base on the Mekong at
Neak Luong, and a Cambodian delegation is said to
have arrived in Saigon yesterday to begin working
out a schedule for the South Vietnamese withdrawal.
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the Cambodians want to have immediate, complete con-
trol of military operations on the Mekong because
they cannot work with the South Vietnamese with the
"mutual trust" that a phased turnover, would require.
The Cambodians seem ill-prepared to replace
the South Vietnamese in maintaining secu-
rity along the river. Their navy has less
than half the number of boats now being
used by the South Vietnamese--most of them
are in bad condition--and it does not have
adequate support facilities. Despite its
clear desire for control over the Mekong,
Phnom Penh probably recognizes that it will
have to continue to rely on Saigon for many
forms of military support for the foresee-
able future.
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FOR THE PRESIDENT ONLY
PAKISTAN
Fragmentary reporting shows that the Bengali
insurgency is persisting in East Pakistan.
The bombing on 11 August of the Dacca Inter-
continental Hotel is the most widely publicized re-
cent incident. Such bombings usually do little
physical damage but have been frequent in Dacca and
Chittagong, where they may be causing some people
to leave the city. Other guerrilla activity con-
tinues to include assassinations, destruction of
bridges, mining of roads, and damage to facilities
of the jute industry, Pakistan's largest foreign
exchange earner.
Rumors of an impending guerrilla offensive
are circulating, but the guerrillas do not
appear strong enough to challenge the army
openly, de4,?o their ability to prevent
the army from re-establishing effective
control.
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COMMUNIST CHINA
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Top Secret
Declassified in Part - Sanitized Copy Approved for Release 2016/06/14 : CIA-RDP79T00936A009800140001-4