THE PRESIDENT'S DAILY BRIEF 14 MARCH 1974

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007697
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 12
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: March 14, 1974

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The President's Daily Brief
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Mai'cri 14, 1974
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Exempt from general .
declassification schedule of EO. 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
March 14, 1974
PRINCIPAL DEVELOPMENTS
Gromyko's visit in Damascus apparently did not go
well, and the Soviets are concerned that their po-
sition in Syria is declining. (Page 1)
The Khmer Communists have shifted their efforts to
government enclaves in the countryside, apparently
because of military reverses around Phnom Penh.
(Page 2)
The return of North Vietnam's ambassador to Vien-
tiane after a ten-year absence indicates Hanoi's
satisfaction with the effectiveness of the cease-
fire and its support for a coalition government.
(Page 4)
Preliminary agreement has been reached for Japan to
provide $400 million to help the Soviets finance a
coal-mining project in Yakutsk. The outlook is
less favorable for joint development of oil, gas,
or timber. (Page 5)
Venezuela's President Perez has said that his admin-
istration is prepared to work out a new arrangement
with the foreign-owned oil companies operating in
Venezuela. (Page 6)
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USSR SYRIA
There is additional evidence that Gromyko's
visit in Damascus did not go well and that the So-
viets are concerned that their position in Syria is
declining.
The communique fol-
lowing the visit strongly suggests that Damascus did
not buy Gromyko's portrayal of the USSR as the spe-
cial protector of the Arab cause. In addition, a
Soviet representative at the Geneva talks has ex-
pressed fears that Syria was now following the same
wayward path as the Egyptians--away from the USSR
and toward the US.
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The communique did not mention 25X1
future Soviet military deliveries.
The Arabs are interpreting the evident Soviet
reluctance to meet their hardware demands as a pres-
sure tactic. The tonnage of suspected Soviet mili-
tary shipments to Syria is running at about prewar
levels[
For their part, the Syrians, like the Egyptians,
discouraged Gromyko's overtures about economic as-
sistance. Damascus evidently has awarded several
construction contracts to the French, to the Soviets'
considerable chagrin.
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CAMBODIA
The Khmer Communists have shifted their efforts
to government enclaves in the countryside, apparently
as the result of a-series of military reverses in the
Phnom Penh area.
An intercept from a senior member of the Khmer
Communist Central Committee specifically states that
the party has decided to attack government-held towns
in the provinces. Other messages show continuing
diversion of Communist forces from the Phnom Penh
area for a major push against the southwestern city
?of KaMpot. At least three Communist regiments along
with substantial quantities of materiel are being
committed to the Kampot front. Some messages sug-
gest that other units may soon begin leaving the
capital area to participate in attacks on the north-
'ern provincial capital of Kompong Thom.
The transfer of insurgent units from the capi-
tal region indicates that :the Communists have tem-
porarily scrapped plans for a major ground ?ush
a ainst Phnom P
Although the Communists badly need a victory
in the outlying provinces to offset their lack of
success around Phnom Penh, they may also need time
to resolve major internal problems. A message from
the Central Committee to a regional subordinate on
March 9 stated that "our military leadership is
weak," and "our overall leadership is foolhardy in
its outlook." Other messages have disclosed Commu-
nist concern over factionalism in insurgent ranks
and over growing resentment among the peasantry
against oppressive Communist policies and population
control measures.
In Phnom Penh, most schools reopened on March 6
after being closed for almost two months, but shut
down again on March 11 when the teachers resumed
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their strike for better wages. The teachers have
vowed to work only the first ten days of each month
until the government acts on their demands.
Radical students in the capital are pressing
for a commemorative ceremony on March 17 for student-
teacher activists killed a year ago by some of Gen-
eral Lon Non's men. The government has decided not
to permit such a ceremony because it might turn into
an antigovernment rally. The government has also
vetoed any public observances on March 18, the
fourth anniversary of Sihanouk's ouster. City offi-
cials have been instructed, however, that should
local disturbances occur on either date, they should
refrain from using firearms.
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LAOS - NORTH VIETNAM
The return of North Vietnamese Ambassador Le Van
Hien to Vientiane yesterday after an effective absence
of nearly ten years is a further manifestation of Hanoi's
support for a coalition government and of its satisfac-
tion with the effectiveness of the Laos cease-fire.
Hien's presence should buoy the spirits of Prime
Minister Souvanna, who has been discouraged over the
recent lack of movement toward forming the new govern-
ment. Soviet Ambassador Vdovin told the US ambassador
earlier this week that Hien's arrival is linked to the
early establishment of a coalition.
The North Vietnamese have supported the Vientiane
peace agreement and have withdrawn at least four in-
fantry regiments from Laos over the past year. De-
spite the Soviet Ambassador's comments, however, Hanoi
probably sees little reason to pressure the Pathet Lao
to move more briskly in the negotiations to implement
the agreement.
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Japanese Interested In Siberian Resources
/*MOSCOW
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Oil Fields
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USSR-JAPAN
Preliminary agreement has been reached on an
economic deal in which Japan would provide $400 mil-
lion to help finance a coal-mining project in Yakutsk.
In return, Japan would get more than 5 million tons
of coking coal annually for 16 years beginning in
1983.
The terms of the Japanese credit and the price
of the coal are among the important details to be
worked out at negotiations in Tokyo later this month.
The Japanese, who found the Soviets more disposed to
negotiate than before, are confident that an agree-
ment will soon be reached.
The outlook is less favorable for joint devel-
opment of oil, gas, or timber. Of these, explora-
tion for Sakhalin oil has the best chance of success.
Soviet trade and banking officials are expected in
Tokyo soon to discuss Japanese loans for this proj-
ect. The USSR has been asking for $200 million;
the Japanese have been offering substantially less.
One obstacle to the Yakutsk oil and gas project is
Japan's need for US equipment. Participation of US
firms is threatened by restrictions on Export-Import
Bank financing for the USSR.
The Soviets in general are reluctant to share
their vital resources and want generous terms. Mos-
cow regards Japan as the country hardest hit by the
energy crisis and believes it will eventually have
to come to terms with the Soviets.
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VENEZUELA
President Carlos Andres Perez told a visiting
US official this week that his administration is pre-
pared to work out a new arrangement with the foreign-
owned oil companies operating in Venezuela.
Perez said that continuing the present conces-
sionary arrangement for ten years--when the conces-
sions begin to expire--was impossible. Nevertheless,
he hoped that the oil companies would make the first
move by presenting their ideas, and he promised that
his administration would respond to their suggestions.
Perez' remarks, both private and public, indi-
cate that he intends to proceed at a measured but
steady pace, disregarding leftist and nationalist
calls for immediate nationalization. He appears will-
ing to hear the recommendations of the companies as
well as those of a commission that he intends to set
up to advise the government on possible alternatives
in operating the oil industry.
Once these recommendations are forthcoming,
Perez is expected to draw up legislation to take over
the oil industry. Although he has set no timetable,
he clearly does not intend to allow the talks with
the oil companies to continue indefinitely.
Perez' overwhelming electoral man-
date and his party's strong position in the new Con-
gress enhance the prospects for a petroleum policy
that will have the support of most Venezuelans, and
encourage further investments.
Although US oil company officials have avoided
public comment on the future of their operations in
Venezuela, they are generally optimistic that they
will be able to secure terms that afford some protec-
tion to their $1.5-billion investment./
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