THE PRESIDENT'S DAILY BRIEF 1 NOVEMBER 1974

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007857
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: November 1, 1974

Declassified in Part- Sanitized Copy Approved for Release 2016/07/15 : CIA-RDP79T00936A012300010034-3
The President's Daily Brief
November 1, 1974
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Exempt from general
declassification schedule of E.O. I 6521
exemption category, 5B( I ),(2),(3)
declassified onlg on approval of
the Director of Central Intelligence
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Declassified in Part - Sanitized Copy Approved for Release 2016/07/15 : CIA-RDP79T00936A012300010034-3
FOR THE PRESIDENT ONLY
November 1, 1974
"Table of Contents, ,
USSR1
Arab, States, -
South Vietnam: President Thieu seems in no hurry
to fill cabinet vacancies; demonstrations con-
tinue. (Page 3)
Spain: Prime Minister Arias reiterates his inten-
tion to continue the program of gradual politi-
cal liberalization. (Page 4)
West Germany, - Iran: The drive to strengthen rela-
tions with Iran derives from Bonn's determina-
tion to develop sources of oil that are both
secure and diversified. (Page 5)
Note: Eastern Europe - USSR (Page 6)
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ARAB STATES ? ISRAEL
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FOR THE PRESIDENT ONLY
SOUTH VIETNAM
The government may have trouble re-
placing the four cabinet ministers who re-
signed last week. At least two people
have turned down the Ministry of Infor-
mation portfolio, and potential candidates
in the opposition ranks say they are un-
willing to join the Thieu government with-
out assurances of a "change in policy."
President Thieu, however, appears to be in no
hurry to fill the vacancies. )
Rumors persist that as many as six other cabi-
net ministers will leave. Additional resignations
could come as part of a general shake-up designed to
deflate opposition charges of government inefficiency
and corruption.
Demonstrations and incidents, meanwhile, are
continuing. More are scheduled for today, which is
South Vietnam's National Day. Most so far have been
minor in scale and handled easily by the police, who
have created no martyrs. President Thieu appears to
be determined not to have any violent confrontations
in Saigon during the next few days. Central Saigon
has been cordoned off, and large numbers of police
have been posted throughout the city. This massive
police presence appears to be contributing to exag-
gerated press reporting on the situation,
FOR THE PRESIDENT ONLY
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SPAIN
Prime Minister Arias has reiterated
his intention to continue the program of
gradual political liberalisation even
though two liberal ministers were dropped
from the cabinet on Wednesday.
Arias told members of a Spanish labor organiza-
tion that the government was determined to give the
people a voice in the highest institutions. He pledged
laws to improve working conditions and to give work-
ers a larger voice in settling labor disputes. Mod-
erates and liberals remain concerned, however, that
the cabinet change signals a turn to the right and
the shelving of any meaningful liberalization program.
The government has again postponed the trial of
five leaders of the clandestine Socialist trade union
which was scheduled to begin this week. The labor
leaders were charged in 1971 with "illicit associa-
tion" and "possession of illegal propaganda." Right-
ists have insisted on stiff penalties. The govern-
ment postponed the case this time on grounds that new
evidence against one of the accused requires further
study by the court.
The real test of Arias' liberalization program
will come when the Prime Minister presents his bill
to permit the formation of political associations,
which he has promised by the end of the year. Right-
ists object to associations, fearing they will become
full-fledged political parties and usurp the role
hitherto reserved for Franco's National Movement.
Far more serious polarization could result if Arias'
program is further watered down.
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FOR THE PRESIDENT ONLY
WEST GERMANY - IRAN
West Germany's drive to strengthen
relations with Iran derives from Bonn's
determination to develop sources of oil
that are both secure and diversified.
As part of this effort, Bonn is likely
to go on trying to get the EC to extend
duty-free status to Iran's petroleum
products.
Early this year, Tehran expressed interest in
negotiating a new trade agreement with the EC. The
suggested pact would assure free access to West Euro-
pean markets for manufactured items produced by Iran
within the framework of EC-Iran cooperative arrange-
ments, and duty-free status for petroleum products
from a refinery to be constructed by the Germans.
Iran's willingness to give West Germany a contract
to construct a petroleum refinery is in large meas-
ure contingent on Bonn's support in obtaining an EC
commercial agreement along these lines.
Other EC members and the US have pointed out to
Bonn that a preferential agreement with Iran would
contravene both provisions of GATT and previous EC
commitments to the US to avoid special trading ar-
rangements.
Some EC governments, however, may be under strong
pressure from their own energy officials, as well as
from Iran, to deal on Tehran's terms. -Their obvious
dilemma is that, whatever their decision, they will
anger either a major oil producer or a major ally.
The matter assumes particular importance within
the context of the EC's efforts to develop a program
of economic cooperation with the Arabs. Other oil
producers presumably would resent preferential treat-
ment accorded Iran by the EC and would demand similar
arrangements for themselves.
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FOR THE PRESIDENT ONLY
NOTE
Eastern Europe - USSR: CEMA's International
Investment Bank is having trouble floating a $1.3-
billion Eurodollar loan because of the scarcity of
medium- and long-term funds in international money
markets. The bank probably will have to settle for
several smaller loans stretched out through next
year. The loan is for purchasing Western equipment
for two development projects in the USSR: $1 bil-
lion for pipe and other equipment which East Euro-
pean countries will provide for a 1,650-mile gas
pipeline from central Asia to Eastern Europe, and
$300 million for a Siberian metallurgy project,
probably development of copper and nickel deposits.
FOR THE PRESIDENT ONLY
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Top Secret
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