THE PRESIDENT'S DAILY BRIEF 5 JANUARY 1974

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007639
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: January 5, 1974

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The President's Daily Brief
January 5, 1974
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11.
Exempt from general
declassification schedule of E.O. 11652
exemption category 58(1),(2),(3)
declassified only on approval of
the Director of Central Intelligence
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FOR THE PRESIDENT ONLY
THE PRESIDENT'S DAILY BRIEF
January 5, 1974
PRINCIPAL DEVELOPMENTS
Military activity was light along both the Egyptian
and Syrian fronts yesterday. (Page 1)
Egyp
/(Page 2)
The Viet Cong have reacted favorably to Saigon's
latest offer on prisoner exchanges but have so far
avoided any firm commitment. (Page 3)
An appraisal of developments in the money markets
yesterday appears on Page 4.
Notes on a Chinese military delegation's coming visit
to Pakistan and on Turkish reaction to Makarios' arms
imports appear on Page 5.
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ARAB STATES - ISRAEL
Military activity was light on both fronts yes-
terday
On the Suez front there was only sporadic ar-
tillery and light arms fire; two Israelis were re-
ported wounded near Suez city. The heavy artillery
exchange which began on January 2 has ended, and the
Israelis allowed UN supply convoys to proceed to
Suez city and to the Third Army on the east bank
after stopping them on the two previous days.
Is
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EGYPT-USSR
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SOUTH VIETNAM
The Viet Cong have reacted favorably to South
Vietnam's most recent offer on prisoner exchanges
but have avoided making a firm commitment. The South
Vietnamese proposed the release of some 600 civilian
detainees next week as a "first phase" of the new
exchanges in return for the 410 remaining military
prisoners held by the Communists. Saigon's chief
negotiator has suggested to President Thieu that the
government go ahead and free 1,500 prisoners even if
the agreement falls through.
Attitudes at the top levels of the Saigon gov-
ernment and the Viet Cong will determine just how
far the exchange will go. Although Thieu apparently
authorized his subordinates to reach a new agreement,
he may yet balk at the terms. In the past, he has
sought to ensure the release of all South Vietnamese
prisoners held by the Communists, including those in
Laos and Cambodia. The Viet Cong have never firmly
agreed to this provision.
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INTERNATIONAL MONETARY DEVELOPMENTS
The dollar's latest surge eased on most European
exchange markets yesterday. Although the Bundesbank's
intervention approached $400 million last week, its
policy is still unclear pending the monthly meeting
of central bankers on Monday. The Germans will ap-
parently seek a united European approach to the prob-
lem. Sterling closed lower after a short-lived rally,
and the dollar strengthened moderately against other
major currencies in quiet trading.
The Bank of Japan sold $400 million yesterday
to maintain the 280 yen-dollar exchange rate. Japan's
gloomy balance-of-payments prospects and the proba-
bility of further devaluation for the yen caused the
strong downward pressure.
The price of gold fell $2.75 an ounce to $118.50.
Recent large price fluctuations reflect a thin market
rather than a change in supply and demand trends.
The full effect of the dollar's new strength is
only beginning to become apparent. The fear of a gen-
eral recession and of balance-of-payments problems
will make multilateral trade negotiations more diffi-
cult and tend to weaken prospects for monetary reform.
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NOTES
China-Pakistan: Chinese Army Deputy Chief of
Staff Chang Tsai-chien begins a 12-day visit to Pak-
istan tomorrow./
Chang is likely to survey Pakistani needs in some
detail and discuss delivery arrangements. Additional
Chinese aid may be forthcoming, particularly in light
of recent Soviet pledges of additional military as-
sistance to India.
Turkey-Cyprus: Turkish concern is growing over
the arms shipment from Czechoslovakia to Cyprus last
month for Makarios' personal security force. On
Thursday, a Turkish Foreign Ministry official claimed
the shipment included Snapper anti-tank missiles and
asked for any information the US had on the shipment.
He indicated that Turkey had also raised the matter
with UN representatives on Cyprus. Although the re-
cent arms shipment reportedly included some shoulder-
fired anti-tank guns, the US Embassy in Nicosia doubts
that any Snappers arrived in Cyprus recently. The
Cyprus National Guard has had Snappers for several
years, however.
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