WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A007200080001-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 33
• Document Creation Date: December 21, 2016
• Document Release Date: April 28, 2008
• Sequence Number: 1
• Publication Date: August 15, 1969
• Content Type: SUMMARY

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Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
Secret
State Dept. review completed
51
15 August 1969
No. 0383/69
~2 -
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SECRET
Europe
THE WEEK IN PERSPECTIVE
SINO-SOVIET BORDER CLASH INCREASES TENSIONS
The latest publicized armed incident on the highly
volatile Sino-Soviet border appears to be the result
of the high level of tensions that now exist rather
than a deliberate prelude to enlarged military con-
flict.
DISARMAMENT TALKS LAG AT GENEVA
The Geneva disarmament talks are still primarily
focused on the proposed treaty limiting the use of
the seabeds for military purposes, with little pros-
pect for early agreement.
HUNGARIAN YOUTH TROUBLING REGIME
The widespread political apathy of Hungary's young
people is becoming a major concern of the Kadar re-
gime. The party's central committee will attempt to
come to grips with the problem in the near future,
but overcautiousness may block realistic solutions.
CZECHOSLOVAKIA BRACES FOR ANNIVERSARY OF INVASION 13
Regime authorities are taking elaborate precautions
to discourage anti-Soviet actions on the first anni-
versary of the invasion, but some demonstrations--if
only scattered and relatively peaceful--are likely.
FRENCH PULL OFF SURPRISE DEVALUATION
The 11.1 percent franc devaluation goes a long way
to correct France's international payments position
but needs to be followed up by internal measures un-
popular with workers. The devaluation adds to ex-
isting pressures on weak currencies such as sterling
and immediately resulted in a major adjustment of
the Common Market Agricultural Policy.
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Middle East - Africa
THE WEEK IN PERSPECTIVE
ISRAEL CONTINUES STRIKES AT ARAB NEIGHBORS
Two Israeli air strikes, one against Jordan's East
Ghor Canal, the other against fedayeen bases on
the Lebanese slopes of Mount Hermon, contributed
to a serious rise in hostilities this week. The
Jordanian incident may have serious economic re-
percussions, and the Lebanese incident political
ones.
KEY INDIAN STATE BESET BY GROWING TROUBLES
The Communist-led United Front government in West
Bengal is increasingly hard pressed by widespread
civil unrest and a faltering economy, caused in
part by friction among the coalition partners.
POLITICAL MANEUVERING CONTINUES IN PAKISTAN
Pakistan inched its way last week toward eventual
civilian rule as President Yahya Khan appointed
civilian ministers, and the deputy martial law
administrators returned to their military duties.
Meanwhile, litical maneuvering continued
TRIBAL TENSIONS REMAIN HIGH IN KENYA 21
Kenya's politics are becoming increasingly polar-
ized along tribal lines. The Kikuyu are determined
to keep political power at all costs, while the Luo
are dissatisfied with the government of President
Jomo Kenyatta.
CRISES THREATEN AS GHANA NEARS PARLIAMENTARY ELECTIONS 22
A proposal for a junta-manned "corporate presidency"
when Ghana is returned to civilian rule next month,
together with a dispute over the eligibility of the
major candidates in the parliamentary elections of
29 August, threaten to plunge the country into a
serious crisis.
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Western Hemisphere
THE WEEK IN PERSPECTIVE
LATIN AMERICAN PARLIAMENT PROVIDES FORUM FOR NATIONALISM
24
Latin
week
nomic
American
reiterated
policies
legislators meeting in Bogota
their dissatisfaction with US
and expressed their respective
last
eco-
anti-US
nationalism.
EL SALVADOR-HONDURAS DISPUTE REMAINS DEADLOCKED
The situation has changed little in the two weeks
since Salvadoran troops withdrew from Honduras, and
prospects for early normalization of relations be-
tween the two countries are not good.
GUYANA STILL WORRIED ABOUT PROTECTING ITS BORDERS
The government is concerned about how to handle its
long-standing border disputes with Surinam and Vene-
zuela.
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The opening of the Communists' `autumn offensive in South Vietnam
was signaled by a "high point" on 11-12 August, in which a series of
widespread, coordinated shellings and ground attacks took place. The ac-
tivity decreased very quickly, however, indicating that the offensive will
probably consist of a series of such high points. The next one may be
scheduled for 19 August, a Communist holiday.
On the political front, Prime Minister Huong apparently will retain his
post following announcement of an agreement between President Thieu and
Huong to broaden the cabinet's political base. On the other hand, the leaders
of Thieu's political alliance have called for Huong's dismissal, adding to the
confusion in Saigon.
Military activity in Laos remained at a relatively low level this week,
with Communist forces continuing to nibble away at government positions
and showing no signs of withdrawing. Heavy monsoon rains hampered
operations, and both sides had difficulty in moving troops and supplies. The
poor flying weather also added to the government's problems.
General Lon Nol may have extracted a number of concessions from
Prince Sihanouk as his price for forming a new cabinet in Cambodia, and the
new government now may move toward economic reform. Lon Nol has
already called for an end to nationalization of the economy, a policy he has
long considered at the root of Cambodia's economic difficulties. Sihanouk,
while apparently granting his new premier some latitude in domestic prob-
lems, is likely to continue to make most foreign policy decisions himself.
Malaysian Prime Minister Rahman has decided to play an active role in
the ruling National Operations Council, a decision that is not likely to sit
well with Malay extremists, who regard Rahman's conciliatory policies
toward the Chinese as responsible for the country's Malay-Chinese com-
munal strife. Malay moderates are in firm control of the government and
security forces, but infighting among those unhappy over Rahman's move or
a recurrence of racial violence could strengthen the extremist's hand.
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VIETNAM
Communist forces broke their
eight-week lull on the night of 11-
12 August with a series of wide-
spread, coordinated shellings and
ground attacks against towns and
allied bases throughout South Viet-
nam. The attacks probably marked
the opening "high point" in the
enemy's anticipated "autumn of-
fensive." The "high point" ap-
pears to be similar to earlier
brief but intense surges of Com-
munist attacks in May and June.
The new enemy flare-up was
preceded by weekend attacks
against US positions near the
Demilitarized Zone and in Tay
Ninh Province, and by a reported
battalion-sized assault against
South Vietnamese Army troops in
the central coastal province of
Binh Thuan. The heaviest ground
attacks on 11-12 August occurred
to the north of Saigon in Tay
Ninh, Binh Long, and Phuoc Long
provinces. A few rockets were
launched against the outskirts
of Saigon, Hue, and Da Nang,
but these did not cause serious
damage.
Communist units are in po-
sition to launch follow-up at-
tacks in scattered areas of the
country, including further ac-
tions in northern III Corps.
The major elements of the four
enemy divisions in III Corps--
the lst, 5th, 7th, and 9th--
have over the past several
months pulled away from the Sai-
gon area to bases astride Tay
Ninh, Binh Long, and Phuoc Long
provinces. In these areas, jungle
cover affords extensive maneuver
opportunities relatively protected
from allied aerial observation and
harassment. In addition, these
units have benefited from close
access to supplies and replace-
ments via Cambodian safehavens.
In recent weeks and days,
units from the enemy divisions
in III Corps began to move out
toward key targets in the area,
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plans call for fairly
heavy attacks against allied bases
in this northern tier of provinces,
while elsewhere in III Corps Com-
munist action would be limited to
shellings and small-scale guerrilla
and sapper forays against the gov-
ernment's pacification support
elements. This activity is ex-
pected to be coordinated with
heightened Communist proselyting
and selective terrorism.
The other principal areas
where Communist forces pose a
significant threat include the
DMZ region, a segment of the
coastal region in southern I Corps,
and isolated parts of the central
highlands and Mekong delta region.
There appears to be no serious
ground threat to the country's
three major cities, but these
could experience additional shell-
ings or terrorist incidents.
Political Developments
One major hurdle in the re-
organization of the South Vietnam-
ese Government, which has been
pending since mid-July, may have
been overcome during a meeting
between President Thieu and Prime
Minister Huong on 13 August. Ac-
cording to an official communique,
the two leaders have agreed to a
broadening of the cabinet's politi-
cal base. Although it was not ex-
plicitly stated that Huong would
remain prime minister, the ref-
erence to agreement suggests this
Thieu appears to have de-
liberated at length over whether
to keep the aging Huong or to re-
place him with someone more amen-
able to a government of politi-
cians. The prime minister, al-
though anxious to remain in of-
fice, had taken the view that
the cabinet should continue to
be composed of technicians and
administrators.
The announcement could mean, how-
ever, that his retention depends
on an accord over the entire cab-
inet make-up.
Adding to the confusion,
leaders of President Thieu's po-
litical alliance, the National
Social Democratic Front (NSDF),
on 8 August publicly called for
Huong's ouster. Apparently re-
flecting their lack of closeness
to the President and their own
internal divisions, four of the
six NSDF parties later put for-
ward their own candidate for
prime minister.
Strains have been increasing
between Thieu and the NSDF lead-
ers as they have continued to
clamor for key cabinet positions
despite Thieu's original stipula-
tion that they would have to wait
as long as two years for govern-
ment patronage. Since the NSDF
parties are not yet in a position
to bring the government truly
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effective support in the National
Assembly or in the public at
large, Thieu clearly intends to
give some of the limited politi-
cal plums available to groups
outside the NSDF.
Ferment Among Vietnamese Exiles
Several recent Communist
statements have suggested that
a new political initiative in-
volving Vietnamese exile groups
may be in the making. Last week
a spokesman for the Viet Cong's
Provisional Revolutionary Gov-
ernment (PRG) once again stated
that "consultations" were going
on between the PRG and other
South Vietnamese groups in Paris,
Saigon and elsewhere. On 2 Au-
gust, a Viet Cong broadcast re-
ferred to a new plan to raise the
prestige of the PRG.
Hanoi obviously hopes to
draw other South Vietnamese po-
SECRET
litical forces into closer as-
sociation with the PRG, and it
now may be trying to line up exile
support behind a broad set of com-
mon objectives. In contrast to
Saigon's lack of attention to
overseas Vietnamese, the Commu-
nists have worked hard among them
and have given a specific nod to
exile groups in the Liberation
Front's 10-point peace plan.
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PEKING TAKES A TOUGHER STANCE ON LOCAL FACTIONALISM
Central authorities are be- I
coming increasingly concerned UNa
over continuing factionalism in UN
the provinces and are devoting
more attention to the problem.
In recent weeks, there have been
a series of meetings in Peking
with leaders from some of China's
more troubled provinces, propa-
ganda has assailed "anarchism,"
and a new central directive has
been issued.
Since mid-July provincial
radiobroadcasts have heavily
stressed the need for "organiza-
tional discipline" to halt anar-
chic trends and persistent fac-
tionalism. This theme marks a
shift in emphasis from that taken
after last April's ninth party
congress, which was confined to
more general appeals for national
unity under the leadership of the
party. The central authorities
now appear to be overcoming their
reluctance to tackle some of the
problems contributing to weakness
and divisions at the basic levels.
Nationwide publicity is be-
ing given a central committee
directive dated 23 July calling
on factionalists to cease fight-
ing and to surrender their fire-
arms within one month or be
treated volution-
aries.
It is doubtful, however,
that these latest efforts will
be any more successful than pre-
vious attempts to end factional
fighting. The army, which is
charged with implementing the
23 July directive, is likely to
take a cautious approach, in
part because the military itself
remains politically divided in
some troubled provinces. More-
over the instructions are likely
to prove particularly difficult
to enforce in those areas of west-
ern China where factional rival-
ries are most pronounced. Peking
may also run into difficulty in
a number of previously stabilized
provinces in eastern and southern
China which are now experiencing
sporadic disorders.
Posters appearing recently
in Peking, for example, described
the situation in Hunan Province
as "grave" and requested that
troops be dis atched there from
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MALAYSIAN PRIME MINISTER ADDS To PRECARIOUS SITUATION
Prime Minister Rahman ap-
parently has decided to play an
active role in the National Opera-
tions Council, the powerful body
that has ruled Malaysia since the
outbreak of communal violence last
May. Rahman's effort to reassert
his authority over the govern-
ment's affairs is likely to further
alienate extremists within the
ruling Malay party and the Malay
community.
Rahman told the press that
he will start participating in the
ruling council next week. Although
he did not state clearly how much
power he would try to exercise,
Rahman implied that he would assume
over-all direction of the council
from Deputy Prime Minister Razak,
who is the council's director
and leading figure.
Both Razak and Home Minister
Ismail, the number two man on the
council, have backed Rahman against
efforts by extremist elements to
unseat him, but it is far from
clear whether they are fully be-
hind the Prime Minister's current
efforts to reassume a paramount
position in the government. There
has been a widespread expectation
that Razak would take over com-
pletely in the fairly near future.
This view arose not only because of
Rahman's age and health--he under-
went an eye operation in June--but,
more importantly, because he ap-
parently no longer commands sig-
nificant support within the Malay
community. The prime minister's
conciliatory policies toward the
Malaysian Chinese, moreover, are
widely believed to be responsible
for the country's current diffi-
culties.
No matter how carefully Rah-
man may move in the coming weeks,
it appears likely that efforts to
reassert his authority will be
hotly opposed by the Malay ex-
tremists and will widen the rift
with the moderates. Although the
latter continue to retain both
firm control over the national
administration and the loyalty of
the police and the upper echelons
of the military, either a recur-
rence of racial violence--which
could come at any time--or fac-
tional infighting within the
moderate wing would greatly
strengthen the extremists' hand.
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SOVIET-INDONESIAN ECONOMIC TALKS SET FOR LATE AUGUST
A Soviet economic delega-
tion scheduled to visit Djakarta
later this month to discuss the
rescheduling of Indonesia's debt
to the USSR also is expected to
review the status of Soviet-aided
projects in Indonesia and the con-
tinued supply of military spare
parts.
Moscow probably will offer
enough to assure some presence in
Indonesia, but any commitments
will be limited by a need to avoid
precedents that could be cited by
other debtors seeking relief.
Djakarta's negotiating posi-
tion is constrained by its need
to keep any arrangements with the
USSR within bounds acceptable to
Western creditors who are now in
the process of drawing up a long-
term plan for repayment of Indo-
nesia's $1.7-billion free world
debts. Indonesia hopes to defer
for another year the overdue first
payment on its long- and medium-
term economic credits to the USSR.
Djakarta may be willing, however,
to begin payment on the short-
term portion of its economic debt
which totals $14 million and also
is past due.
The USSR negotiated a debt
repayment agreement with Indonesia
in 1966, but Djakarta has failed
to make any of the $40 million in
payments as they fell due. Debt
discussions were postponed in the
aftermath of the Czechoslovak
crisis in August of last year and
again in October, following In-
donesia's execution of several
local Communist party leaders.
The talks also are expected
to deal with the status of Soviet
construction projects which have
been in abeyance since early 1966.
The Soviet mission, which includes
at least one high-level construc-
tion official, may be prepared to
offer a resumption of some eco-
nomic assistance. Several Soviet
projects--including the Tjilegon
steel plant and the Tjilatjap
superphosphate plant--have been
incorporated into Indonesia's
current five-year economic de-
velopment plan.
Djakarta undoubtedly would
like Soviet aid for these proj-
ects resumed. If a Soviet offer
is not forthcoming, however, Dja-
karta has hinted it will seek to
have Soviet projects completed by
third countries.
Outside of limited mainten-
ance, recent Soviet economic ac-
tivity in Indonesia has been con-
fined to the assembly of three
small dredges to be used in in-
land waterways. All work on this
project has been carried out un-
der cash contracts.
In the military areas, the
Soviets may agree in principle
to the continued sale of spare
parts to maintain and rehabili-
tate previously supplied Soviet
equipment which has deteriorated
severely. The USSR presently is
delivering military spare parts
under a $10 million cash contract
concluded in 1967.
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CAMBODIA'S NEW GOVERNMENT MOVES TOWARD ECONOMIC REFORM
General Lon Nol is organizing
a new government amid signs that
Sihanouk has given him a somewhat
freer hand than past prime minis-
ters.
Lon Nol's cabinet choices
thus far are for the most part
politicians and technicians who
share his conservative political
outlook. The major surprise is
Prince Sirik Matak, a forceful
and independent figure who has
been -penly critical of Sihanouk's
:con mic and foreign policies.
Matak's decision to join the gov-
ernment as first deputy prime min-
ister suggests that he expects
it to be more than a rubber stamp
for Sihanouk.
Lon Nol has not yet chosen
ministers for the economy, an
area in which Sihanouk has called
for sweeping reforms, and which
he claims will be the principal
testing ground for the new govern-
ment. In his first major policy
pronouncement, Lon Nol told the
National Assembly that his govern-
ment will discontinue nationaliza-
tion of vital sectors of the econ-
omy. Although Lon Nol has not
yet spelled out the details, out-
right repeal of the nationaliza-
tion program would represent a
major change in Sihanouk's eco-
nomic policy. It seems likely
that this was one of the conces-
sions Sihanouk made to Lon Nol
and Sirik Matak, both of whom
have long believed that nation-
alization and other ill-considered
measures were behind Cambodia's
economic difficulties.
Lon Nol will probably not
face any serious political opposi-
tion from the left because its
influence in national politics
has diminished sharply in the
past two years. He has a reputa-
tion for dealing firmly with anti-
government elements, particularly
the insurgents now active in the
countryside. He has also advo-
cated more aggressive military
countermeasures against Vietnam-
ese Communist incursions. It
is not clear whether Lon Nol, who
will hold the defense ministry
portfolio, will also retain his
post as commander in chief of the
armed forces.
Although Sihanouk apparently
intends to give his new premier
considerable freedom in attack-
ing domestic problems, Sihanouk
is still likely to reserve major
foreign policy decisions to him-
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Moscow this week had its attention divided between two troubling
situations developing at opposite ends of the USSR. On the East, a new clash
at the border of the Chinese province of Sinkiang occurred on 13 August.
Each side accused the other of sparking the incident, which seems to have
been the bloodiest since the Ussuri River affair last March. Although neither
side seems to want a wider conflict, this latest incident can only increase
tensions on the border and add to the explosive potential.
In the West, Moscow was faced with the prospect of more trouble in
Czechoslovakia as the anniversary of the invasion neared. A high-level Soviet
military delegation has been in Czechoslovakia to oversee the security
preparations of Czechoslovak authorities. The situation there is tense, and
some anti-Soviet demonstrations, if only scattered and relatively peaceful,
seem likely. Party leader Husak is going all out to control the situation,
aware that his job may depend on his ability to do so. Rumors of impending
Warsaw Pact exercises with Czechoslovakia during the anniversary period
remain unconfirmed.
While the afterglow of President Nixon's visit to Romania lingered,
Ceausescu acted quickly to redress the balance with his Communist allies at
the party congress that ended on 12 August. He put the best face possible on
Romanian-Soviet relations without shying away from his independent posi-
tion. As the congress closed, Ceausescu advanced many second-generation
Communists into national-level party positions and downgraded some "old
guardists." Bucharest will further prolong its festive atmosphere as it pre-
pares to celebrate the 25th anniversary of Romania's "liberation" on 23
August.
The East Germans this week in effect rejected an Allied proposal that
they meet with the West Germans to discuss transportation and communica-
tions. East German spokesmen insist that talks with the West Germans will
be possible only if Bonn accepts East Germany as a sovereign state.
In France, President Pompidou's decision to devalue the franc, his first
major break with Gaullist policies, was applauded by most members of the
governing majority but drew fire from left-wing Gaullists, the Socialists, the
Communists and union leaders. The full political implications will become
clear only after the close of the August vacation period and the convening of
a special session of the National Assembly.
The devaluation jolted the machinery of the Common Market, and a
marathon 19-hour session of the Council of Ministers in Brussels worked out
a compromise favorable to France on the Common Agricultural Policy.
Premier Rumor's new minority Christian Democratic government in
Italy completed the presentation of its program and won its final vote of
confidence on 12 August.
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SING-SOVIET BORDER CLASH INCREASES TENSIONS
The latest publicized clash
on the highly volatile Sino-Soviet
border appears to be the result of
the high level of tensions that
now exist rather than a deliberate
prelude to enlarged military con-
flict. The exchange of protest
notes on 13 August indicates that
this is the largest clash since
the incidents last March on the
Ussuri River along the eastern por-
tion of the frontier, but the im-
mediate military crisis appears to
be over.
Moscow's propaganda coverage has
been unusually subdued.
Other recent developments
also suggest that neither side
wishes the inflamed border sit-
uation to get out of hand. Fol-
lowing seven weeks of negotia-
tions, the Chinese and Soviets
signed a border river navigation
agreement on 8 August.
The exchange is one in a se-
ries of armed incidents that have
occurred along this stretch of the
Sinkiang-Kazakhstan border. Last
June the two sides exchanged
charges of an "armed intrusion."
Peking was the first to pub-
licize the clash in an apparent at-
ttempt to portray the Soviets as
the unreasonable, aggressive party
in the dispute. Each side almost
immediately protested the incident,
however, charging the other with a
"preplanned attack." The Chinese
later on 13 August accused the So-
viets of continuing to "amass troops"
in the area and "incessantly" fir-
ing on Chinese frontier guards.
Current evidence suggests,
however, that neither side intends
to widen the clash into a larger
conflict. Moreover, both sides
have thus far limited their politi-
cal response to the exchange of
diplomatic notes couched in stand-
ard protest style. There have
been none of the large-scale dem-
onstrations in China that char-
acterized Peking's reaction fol-
lowing the incidents in March, and
Nei-
ther side is likely to compromise
fundamental positions, however,
and questions of national pres-
tige could lead to an intensifica-
tion of a relatively minor in-
cident. The latest clash can only
increase tensions in the border
situation and add to its explo-
sive potential. 25X1
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DISARMAMENT
TALKS LAG AT GENEVA
The Geneva disarmament talks
are still primarily focused on
the proposed treaty limiting mil-
itary use of the seabeds, with
little prospect for early agree-
ment. Pressure to revise the US
draft treaty is increasing. The
British, terming some features
of the US draft "completely un-
negotiable" within the disarma-
ment group, plan to offer an al-
ternative text. The Canadians
may do so as well if the US makes
no revision in its draft. The
Soviets are sticking firmly to
their draft.
A report drafted for UN Sec-
retary General Thant on the ef-
fects of chemical and biological
warfare (CBW) is also being con-
sidered at Geneva. The report
calls for an agreement to halt
development, production, and
stockpiling of CBW agents. Swe-
den has circulated a proposal
along the lines of the Thant re-
port, and Britain has submitted
a draft convention applying only
to biological warfare. The So-
viets oppose separate considera-
tion for biological warfare--
maintaining that such action
would undermine the 1925 Geneva
Protocol--and have pointed to
the recent incident on Okinawa
to illustrate the need for deal-
ing with chemical warfare.
A number of nonnuclear par-
ticipants in the Geneva talks
have expressed concern over the
lack of progress. Italy had of-
fered an alternative to the pro-
posed report to the UN General
Assembly written by the cochair-
men, the Soviet Union and the US.
The Italian paper implied criti-
cism of the cochairmen, stating
that "higher priority should be
given to. . .checking vertical pro-
liferation of nuclear weapons by
states now possessing them." The
Italians withdrew their proposal
last week, but it led to some bit-
terness over the fracturing of
traditional alignments at Geneva.
Early this month, six new
members--Netherlands, Hungary,
Pakistan, Yugoslavia, Argentina
and Morocco--were admitted to the
talks after lengthy negotiations
between the cochairmen. Some of
the original members opposed these
selections and threatened to bring
the matter before the UN General
Assembly. This tactic remains a
possibility; Mexico has indicated
it may raise the issue of enlarge-
ment in New York. The enlarge-
ment to 26 members makes the name
of the group--The Eighteen Nation
Disarmament Committee--obsolete,
and the cochairmen have agreed
to seek members' support for de-
signating it "The Geneva Disarma-
ment Committee."
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HUNGARIAN YOUTH TROUBLING REGIME
The widespread political
apathy of Hungary's young people
is becoming a major concern of the
Kadar regime. The party central
committee will attempt to come to
grips with the problem in the near
future, but overcautiousness may
block realistic solutions.
Overzealous repressive meas-
ures and bureaucratism have stunted
spontaneous youth movements in the
past. As a result young people
have rejected the empty formalism
of the Communist front organiza-
tions and have adopted an attitude
of cynical indifference, avoiding
all forms of political involvement.
,government-sponsored polls
recently uncovered evidence of the
depth of youth's alienation from
the system. Of a sample taken
among industrial arts students,
96 percent professed ignorance
of the name of Hungary's premier
and over 50 percent of Budapest
University students sampled showed
negative attitudes toward Kadar's
brand of socialism. The only
openly admitted interests were
for Western fads--"the beat frenzy"
in party jargon--and for material
well-being. Beneath the surface,
however, frustrated nationalism
and democratic urges are keenly
felt and the youth may eventually
adopt more active forms of expres-
>ion if the regime does not deal
positively with their problems.
Lahos Mehes, first secretary
of the Communist Youth League,
pointed to the existence of "ex-
tremely negative attitudes" among
the nation's youth in an article
last month in the youth organ
Ifjusag. Mehes, however, offered
only ttTe hackneyed theme of "in-
ternationalist bourgeois subver-
sion" as an explanation and a vague
proposal for reorienting the youth
towards building socialism as a
solution.
The regime has not given se-
rious attention to its youth since
the repressive reconstruction era
after the 1.956 revolt. It is
badly out of touch with the cur-
rent generation. To remedy this,
the moderates in the party leader-
ship would like to channel youth-
ful energy and talent into the
regime's program of gradual reform,
and Kadar himself is probably will-
ing to grant some concessions to
this end.
IHungarian leaders are also
keenly aware, however, of the dan-
ger of unleashing pent-up
frustra-tions, particularly in view of the
Soviets' increasing wariness of
Czechoslovak-style variants. Fur-
thermore, the conservative ranks
of the Hungarian party are opposed
to any moves which would bring
students into more active roles.
Striking a balance between caution
and necessary Chan e will be dif-
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CZECHOSLOVAKIA BRACES FOR ANNIVERSARY OF INVASION
Authorities in Prague last
week began elaborate security
preparations in an effort to dis-
courage anti-Soviet demonstra-
tions during the first anniver-
sary of the invasion. Despite
these precautions, the tense po-
litical situation and public con-
cern with the vicissitudes of the
occupation make it likely that
some demonstrations--if only scat-
tered and relatively peaceful--
will occur.
officials are rounding up known
criminals and dissidents they con-
sider likely to cause trouble.
Party first secretary Husak
realizes that this regime must
control any civil unrest or face
the re-entry of Soviet forces
into the cities and possibly his
removal. He has ordered the reg-
ular police reinforced and the
people's militia--the party's
security arm--activated. Some
units of the Czechoslovak Army
problably are on alert. Security
T e reported
plans of some conservatives to
"celebrate" the anniversary, if
carried out, could spark open
clashes between pro- and anti-
Soviet groups.
~.r r ea aboat f entrance ofarmtes from
e state in our territory It zs necessary to say that
leading`organ,. v our part,)' and our state had 1lot
requested this entry It was a tragic mistake, a tragic
misunderstanding and' we said so in Moscow # 'e said `
that: in - our opinion they had' overestimated in this
concrete situation the danger off ` these; (antisocialist)
f trees e said that m `our opinion this inteiventi`on
vas nor necessary and in no case should have;,been
effected without talks,'- without the consent'o, our
,leading State an party organs?'?
$iatei>;eitt attributed to Gustav
Rusak at Slovak party congress,
2;August1968
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The more extreme of the coun-
try's disaffected youth are an-
other potential source of trouble.
According to a recent poll, two
thirds of the university students
who are party members have no
confidence in Husak's leadership.
Some youthful dissidents recently
stole a small quantity of arms,
possibly intending to stir up
trouble.
While the regime is tight-
ening security, reports that more
Soviet troops have moved into the
country and recurrent rumors that
Warsaw Pact exercises around key
cities have been set for the an-
niversary period remain uncon-
firmed. Russian General Yepishev
the political boss of the Soviet
armed forces, remained in Czecho-
slovakia last week. He probably
was attempting to assess the re-
liability of the Czechoslovak
armed forces as the anniversary
period nears and to oversee any
security arrangements that might
affect Soviet occupation forces.
Husak, meanwhile, still has
not succumbed to increasing pres-
sures from the Soviets and do-
mes+-ic conservativesto admit pub-
licly that the invasion was nec-
essary to save ocialism in
Czechoslovakia.
FRENCH PULL OFF SURPRISE DEVALUATION
The 11.1 percent franc de-
valuation announced late last
week goes a long way to correct
France's international payments
position which had been worsen-
ing, but needs to be followed up
by internal measures which will
not be popular with workers. In-
ternationally, the devaluation
adds to existing pressures on
weak currencies such as sterling
and immediately resulted in a
major adjustment of the Common
Market Agricultural Policy.
The devaluation, accomplished
skillfully with no warning, should
contribute considerably to the
restoration of balance in France's
external payments, thus correct-
ing what has become France's num-
ber one economic problem over the
past year. Such an improvement
also depends, however, on govern-
ment control of domestic infla-
tionary forces by restrictive
steps which Paris apparently is
prepared to take.
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The devaluation, Pompidou's
first major break with past Gaul-
list policies, has received mixed
political reactions in France.
Many members of the governing ma-
jority applauded the move as a
necessary and well-executed tech-
nical operation, but the small
left-wing segment of the Gaullist
party attacked Pompidou for fail-
ing to defend the franc "coura-
geously" as De Gaulle had done.
Union leaders and spokesman for
the Socialist and Communist par-
ties charged Pompidou with re-
neging on campaign promises and
expressed concern over the im-
pact of present economic policies
on real worker incomes. However,
the full political implications
of the devaluation will not be-
come clear until the close of
the August vacation period and
the convening of the special ses-
sion of the National Assembly in
mid-September.
The franc devaluation could
have disruptive effects on other
currencies and the international
monetary system as a whole.
Sterling in particular is very
vulnerable, showing weakness on
the foreign exchanges with few
reserve resources in the Bank of
England for defense against a
speculative attack. The sharply
increased British trade deficit
just announced for July further
heightens fears for sterling.
Moreover, the overriding interna-
tional monetary problem--the un-
dervaluation of the Deutsche
mark--was only partly eased by
devaluation of the franc. Con-
tinued speculation on mark re-
valuation can be expected.
The devaluation gave a se-
vere jolt to the Common Market ma-
chinery. The French claimed that
prior notification to the Commu-
nity was impossible because of
the speculation it might have set
off. Urgent meetings were held
to examine the consequences, es-
pecially for the Common Agricul-
tural Policy (CAP). A solution
reached at a marathon 19-hour
session of the Council of Minis-
ters in Brussels in effect sus-
pends for France the application
of the CAP's uniform prices for
one year. The arrangement means
that France will continue to ap-
ply predevaluation prices to its
agricultural production--thus
avoiding the dangers of infla-
tion. The solution buys time un-
til more permanent arrangements
can be work 74 out for the CAP
as a whole.
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MIDDLE EAST - AFRICA
Fighting flared again along the Suez Canal after a comparative lull
during the past two weeks. Israeli aircraft struck at Egyptian artillery
positions in the southern end of the canal after 13 Israelis were wounded
during an exchange of fire on 13 August. Egyptian claims of carrying out a
new series of commando attacks across the canal have not been confirmed.
In India, the presidential election of 16 August has become another test
of strength between Prime Minister Gandhi and the conservative Congress
Party bosses. Tension reached a high level as followers of Mrs. Gandhi began
working openly to defeat the official Congress candidate, who had been
forced on the party over Mrs. Gandhi's strong opposition.
Pakistan's ambassador to Peking and a high Foreign Ministry official
will travel to North Vietnam later this month for a week-long visit. The trip
is being billed as reciprocity for a North Vietnamese goodwill visit to
Pakistan in May 1968.
In the Nigerian civil war, Biafran planes damaged a Gulf oil installation
in the Midwest State. Heavy ground fighting continued, but neither side
made substantial gains. Arms shipments to Biafra appeared to be at a low
level this week.
Algeria, apparently fearing that it may have isolated itself by its
negative attitude and activities during the recent nonaligned consultative
conference, is taking steps to shore up its position as a leader of the third
world. Boumediene recently approached Tito with the objective of im-
proving bilateral relations with Yugoslavia's "on all fronts."
Zambian President Kaunda on 11 August presented his second eco-
nomic "reform" package in a year and a half. The most dramatic part was his
"request" for 51 percent government control of the major foreign-owned
copper companies. The impact on company operations, however will be
gradual.
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ISRAEL CONTINUES STRIKES AT ARAB NEIGHBORS
The level of hostilities
along the Israeli-Jordanian and
Israeli-Lebanese cease-fire lines
rose seriously during the past
week. The new wave of incidents
began on 10 August when Israeli
jets damaged Jordan's East Ghor
Canal for the second time since
June in retaliation for what an
Israeli spokesman termed "stepped-
up Jordanian and Arab commando
aggression" in the northern Jor-
dan Valley. The canal, largely
designed, financed, and built by
the US, represents an outlay by
the US of $17.6 million of the
$23 million already spent on con-
struction. It supplies water to
important banana groves and cit-
rus orchards in the area.
The initial Jordanian re-
action to the Israeli attack was
An emotional threat to escalate
the fighting "on a scale never
before witnessed on the Jordanian-
I:sr.aeli front," if the Israelis
interfered with Jordanian attempts
to repair the damage. King Husayn
through an intermediary asked the
US to inform the Israelis that a
Jordanian working party would be-
gin repairs. He warned that if
-he workers were interfered with,
the Jordanian Valley would be al-
lowed to become a "desert." On
the 12th a group of Jordanians
inspecting the damage left after
Israeli troops fired on them.
Whether the King will follow
through on his threat is diffi-
cuit to predict at this time,
but he must make a decision soon.
Without water the banana groves
have already been irreparably
damaged and the citrus orchards
will go in one week.
Israeli jets also struck
within Lebanon at seven fedayeen
camps on the slopes of Mount Her-
mon. Israel justified its action
by alleging that fedayeen from
the area had been responsible for
21 attacks in Israeli territory
during the past month. The Is-
raeli attack is almost certain to
complicate the situation in Leb-
anon. An uneasy truce has been
in effect since May between the
government and the fedayeen fol-
lowing a number of clashes early
that month. The truce may be
broken if the fedayeen, reacting
emotionally to the attack, attempt
to cross into Israel for retali-
tory raids and the government
blocks their way.
Jordan experienced another
change of government this week.
On the 12th Bahjat Talhuni, who
has headed several previous gov-
ernments, returned to the politi-
cal scene as prime minister. The
retention of some members of the
previous cabinet including the
ex-prime minister Rifai as deputy
prime minister and foreign min-
ister indicates that the change
is a reshuffling, and there will
probably be no major change in
policy. The effort to bring the
fedayeen under government control
is expected to continue, and King
Husayn will continue to be free
to direct the affairs of state
with little interference.
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KEY INDIAN STATE BESET
The Communist-led United
Front government in the important
Indian state of West Bengal is in-
creasingly hard pressed by wide-
spread civil unrest and a faltering
economy, caused in part by friction
among the coalition partners.
Disputes among the 14 parties
in the front have tied down the
state government since it regained
power in February 1969. Little
of its promised reform legislation
has been enacted, although some
matters have been deliberately
deferred because of the state's
chronic and increasing budget
deficit. Violent clashes have
become common as supporters of
different parties in the front
compete to gain sole credit among
labor and peasants for the govern-
ment's limited achievements. Ten-
sion is increased by anxiety among
smaller front groups that the domi-
nant Communist Party/Marxist is
maneuvering to gain enough popular
support eventually to win an elec-
tion outright and govern alone.
Disruptive strikes, launched
mainly by competing labor groups,
are further weakening the state's
economy. A strike in the vital
jute industry recently stopped
production in all 70 mills in the
state. Several factories have
closed because of labor unrest
and new investment is virtually
suspended. The government has
thus far refused to use firm meas-
ures against the "popular" agita-
tion, and has usually not backed
police efforts to control disor-
ders. Police discontent boiled
over last week when several hundred
policemen invaded the legislative
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Page 19 WEEKLY SUMMARY
BY GROWING TROUBLES
assembly to protest the killing of
a policeman by an unruly crowd.
Nevertheless, the coalition
shows no sign of breaking up under
the pressure of its cascading prob-
lems. The Marxist-Communists, who
lead the front, are far short of
enough support in the legislative
assembly to govern alone at this
time, and the other parties fear
isolation if they leave the govern-
ment. The local Congress Party is
the only significant opposition
group but it is in disarray after
its defeat in the elections in Feb-
ruary. Despite the unusually wide-
spread unrest in a key industrial
state, New Delhi appears content
for now to let the situation per-
colate further, and there is no
evidence that it plans imminent
imposition of central government
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POLITICAL MANEUVERING CONTINUES IN PAKISTAN
Pakistan inched its way last
week toward eventual return to
civilian rule. President Yahya
Khan appointed a civilian Council
of Ministers, and the deputy
martial law administrators, al-
though continuing as presidential
advisers, returned to their re-
spective military services. Mean-
while, political maneuvering con-
tinued
Yahya' seven ministerial
appointments have been received
with apathy and some cynicism
throughout the country. The ap-
pointees--primarily veterans of
the diplomatic and civil service--
are a lackluster group who have
been politically inactive in re-
cent years. Although a majority
are East Pakistanis, more port-
folios probably will be awarded
to equalize the number of minis-
ters from East and West Pakistan.
Yahya reserved for himself sev-
eral important portfolios, in-
cluding defense and foreign af-
fairs, but major responsibility
for domestic policy now rests
with the civilians.
Air Marshl Nur Khan, as
deputy martial law administrator,
was the moving force behind the
regime's far-reaching labor and
education policy proposals. His
removal from the scene and the
controversial but hard-driving
secretary of the Education Min-
istry may presage a slowdown in
Page 2 0
implementation of these bold
policy recommendations.
The political spotlight has
once again been pre-empted by East
Pakistani leader Mujibur Rahman,
who has been in Karachi this week
conferring with a variety of in-
dividuals and organizations.
Mujib is receiving close scrutiny
from all politicians in need of
fresh political alliances. A
more interesting aspect of his
visit is the role played by lead-
ers of the revived Sind United
Front (SUF)'who arranged accom-
modations and hosted a reception
for Mujib and his entourage.
Formal ties between the SUF and
Mujib's Awami League--groups
with complementary political de-
mands--would create a coalition
with appeal in parts of West as
well as East Pakistan.
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TRIBAL TENSIONS REMAIN HIGH IN KENYA
While Kenya awaits the out-
come of the trial of Nahashon
Njenga, under arrest for the as-
sassination of Tom Mboya, there
has been no tribal violence. Ten-
sions remain high, however, and
politics are polarizing along
tribal lines.
the only prominent non-Luos in the
opposition Kenya People's Union
(KPU)--including party Vice Presi-
dent Bildad Kaggia--to take the
oath and defect to the ruling 25X1
Kenya Africa National Union (KANU).
The Luo tribe continues to
believe that the assassination of
their fellow tribesman was plotted
by the Kikuyu-dominated government
of President Jomo Kenyatta. The
selection of three Luo for high
government posts was an obvious
effort by Kenyatta to draw the
Luo back to the government fold,
but these appointments have been
met with contempt by many Luo
who believe that the appointees
are fraternizing with the murder-
ers for personal gain.
Meanwhile, Kikuyu leaders
have been attempting, with some
success, to unify their tribe.
These Kikuyu leaders are officia-
ting at tribal oath-taking cere-
monies. Tribal oaths have been
used before, particularly during
the Mau Mau uprising of the 1950s,
to enforce tribal discipline; the
Kikuyu do not take oaths lightly.
They swear in this instance to
defend the tribe against all other
tribes with their lives if neces-
sary. The leaders recently scored
a significant victory in promoting
tribal unity when they persuaded
The polarization of politics
along tribal lines will not neces-
sarily lead to tribal violence.
Most politicians both inside KANU
and out, although condemning bla-
tant Kikuyu tribalism, are pri-
vately attempting to work out a
political arrangement with Ken-
yatta. Kenyatta also provides a
symbol of leadership to most
Kenyans. He is, however, an old
man. Kenya may not survive his
death without major disruption
if the Kikuyu continue in their
attempts to keep political power
at all costs.
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CRISES THREATEN AS GHANA NEARS PART-WFNTARY ELECTIONS
Key members of the ruling
military-police junta are pro-
posing a "corporate presidency"
that hedges on their promise to
return full power to civilians
next month. This proposal, along
with a dispute over the eligi-
bility of one of the major can-
didates for the parliamentary
elections of 29 August, could
plunge the country into a seri-
ous crisis.
The primary junta figures
are giving serious thought to
changing Ghana's draft constitu-
tion to include a powerful three-
man presidency, composed of junta
members, which would represent a
serious dilution of civilian power
y_n the new government. They ap-
carently have convinced Progress
"arty leader Busia to support the
uroposal. The other major can-
hidate for prime minister, Gbede-
mah who leads the National Alli-
ance of Liberals, firmly opposes
Lhe idea, however, and plans to
s=ight it. Gbedemah believes the
proposal reflects the junta's bias
against him and that it would ham-
tring his ability to govern should
.ae win the election.
')-'he junta has at least tem-
porarily postponed the developing
constitutional crisis over Gbede-
mah's eligibility in the parlia-
mentary elections. This long-
Page 2 2
smoldering dispute stems from
Gbedemah's alleged corruption as
finance minister in the early
years of the Nkrumah regime which
the junta ousted more than three
years ago. Gbedemah's opponents
inserted an article into the draft
constitution barring from office
any person so impugned. Support-
ers of Gbedemah in the junta have
been unable to change the eligi-
bility provision, but have suc-
ceeded in holding off promulga-
tion of the constitution, possi-
bly until after the elections.
The crisis will again emerge,
however, if the constitution is
promulgated unchanged. If Gbede-
mah's party wins the elections,
it will make strong efforts to
modify the draft, and this could
plunge the country into a full-
blown constitutional crisis. If
the opposition Progress Party wins,
it will be faced with legal chal-
lenges over Gbedemah's right to
be a member of parliament. Coup
plotting by the loser also cannot
be ruled out.
The parliamentary campaign
itself is proceeding apace. The
outcome remains unclear although
apparent efforts by some junta
members to ingratiate themselves
with the Progress Party indicate
it has a slight edge
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The dispute between El Salvador and Honduras still held center stage in
Latin America this week, although the situation has changed little in the two
weeks since Salvadoran troops withdrew from Honduran territory. Prospects
for an early normalization of relations between the two countries continue
to be poor.
The position of Bolivian President Siles has become precarious again as
a result of increasing distrust on the part of military leaders. Last weekend
Siles appointed a number of prefects and mayors without the approval of
armed forces commander in chief Ovando. Because these local officials will
interpret and implement electoral laws during the election next year, Ovando
wants any vacant posts filled with his sympathizers.
US Ambassador Irwin is scheduled to arrive in Peru soon to renew
discussions on the International Petroleum Company issue. Some Peruvian
officials and the press believe there is nothing to talk about since President
Velasco has rejected the company's administrative appeal. For them, the
only thing the company can do now is take its case to the Peruvian courts.
Negotiations are also going on between Peruvian officials and representatives
of the US-owned International Telephone and Telegraph Company over the
purchase of PERUTELCO, an ITT subsidiary, as part of the government's
plan for progressive nationalization of all telecommunications. The two sides
are still far from agreement on price, but a government official has said that
PERUTELCO will be nationalized within a week or so.
Relations between Mexico and Cuba have deteriorated as a result of
Cuba's decision to grant asylum to two Mexican airplane hijackers. The
Mexican Government is piqued over the implication that its political system
is oppressive, but the foreign minister has reserved comment until "a careful
and exhaustive" study of the matter is made. The press, however, has been
highly critical of Cuba, charging Havana with supporting subversion in
Mexico and questioning the utility of a hijacking treaty currently under
negotiation. The Cubans were angered late last month when Mexico expelled
a Chilean editor of Cuba's news agency, Prensa Latina. Mexico is the only
Latin American country that has diplomatic relations with Cuba.
In the Dominican Republic, Vice President Lora's efforts to persuade
other potential presidential candidates to join the newly formed antire-elec-
tion Democratic Integration Movement underscore the growing split between
him and President Balaguer. Although military leaders have not openly
committed themselves to an candidate, they probably will throw their
support to Balaguer.
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LATIN AMERICAN PARLIAMENT PROVIDES FORUM FOR NATIONALISM
The fourth session of the
Latin American Parliament, which
met in Bogota from 4 to 7 August,
proved to be yet another forum
for expressing Latin American na-
tionalism and dissatisfaction with
US economic policies. Despite the
intense propaganda and Latin Amer-
ican egoism displayed at the con-
ference, however, the organization
appears to be no closer to foster-
ing Latin American integration
through collaboration of the in-
dividual national legislatures.
The Parliament was established
in 1964 to serve as a forum to air
the views of legislators of the
various Latin American countries.
This year's conference was attended
by representatives from Bolivia,
Costa Rica, Chile, Ecuador, Hon-
duras, Nicaragua, Paraguay, Uru-
guay, Venezuela, and Colombia. In
addition, two US congressmen, ob-
servers from eight countries in
the Council of Europe--the Euro-
pean equivalent of the Latin Ameri-
can Parliament--and representatives
from several international organi-
zations were present.
As expected, the Parliament's
closing resolutions contained an
attack on foreign capital and es-
pecially rejected political or eco-
nomic sanctions by the US against
any Latin American government that
adopts a nationalizing policy--the
Hickenlooper Amendment. In another
resolution condemning imperialism
in general, several extremist dele-
gates tried to insert "North Ameri-
can imperialism" but were overruled
by the majority.
The manifesto also repudiated
the de facto governments that hold
power in several Latin American
countries and proclaimed solidar-
ity with popular movements fight-
ing for the overthrow of illegiti-
mate governments.
In order to protect west coast
fishing rights, the Parliament
strongly endorsed the 200-mile
limit as claimed by Peru, Ecuador
and Chile. It stated, however,
that fishing by boats of whatever
flag, including that of the coastal
state, should be regulated within
this limit.
Despite the facts that the
Latin American Parliament is a
paper organization, that it has
been notably ineffective in exe-
cuting its major objective, and
that some of the delegates to it
are unofficial, it does provide
some synthesis of the gripes that
Latin Americans have against the
US and the general anti-US nature
of Latin American nationalism.
These feelings were probably aug-
mented, however, by Latin Ameri-
can pique over the failure of
more US representatives to attend
the conference.
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bLUK1, I
EL SALVADOR-HONDURAS DISPUTE REMAINS DEADLOCKED
The situation has changed
little in the two weeks since
Salvadoran troops withdrew from
Honduran territory, and prospects
for early normalization of rela-
tions between the two countries
are not good.
As before the war, the pri-
mary problem is the Salvadoran
Government's determination to
ensure the protection and equal
treatment of Salvadorans in Hon-
duras. Indeed, this was one of
El Salvador's "war aims." Al-
though El Salvador was able to
penetrate Honduran territory and
avoid being condemned by the OAS
as an aggressor, its military and
diplomatic victories more than
ever appear to be hollow triumphs.
Anti-Salvadoran feeling is now at
an all-time high in Honduras, and
most of the 12,000 Salvadorans
detained during the fighting are
still being held for their own
protection. Labor is insisting
that all Salvadoran immigration
be stopped and that all Salva-
dorans without legal documenta-
tion be deported. In addition,
a widespread campaign is under
way urging Hondurans not to em-
ploy Salvadorans and calling for
a boycott of Salvadoran shops.
The position of the Salvadoran
emigre, therefore, is worse than
ever, and Honduras no longer serves
Page 2 5
as an escape valve for El Salva-
dor's surplus population.
In spite of the poor perform-
ance by his military, Honduras
President Lopez has the support
of nearly all segments of the pop-
ulation. This support, however,
appears to rest on his ability to
maintain a firm position against
continued Salvadoran immigration
and for the deportation of the
large number of Salvadorans now
illegally in Honduras. His sup-
port probably would disappear if
he attempted to make concessions
on these points.
Salvadoran President Sanchez,
for his part, has generally shown
an insensitivity to conditions in
Honduras. His ostentatious vic-
tory celebration and his complete
dismissal of evidence of looting
and pillaging of Honduran towns
by Salvadoran troops has contrib-
uted little to easing the way for
a settlement of outstanding dif-
ferences. On the positive side,
however, he finally agreed to ex-
change military prisoners of war
and on 12 August Honduras and El
Salvador released 27 and 58 pris-
oners respectively. Nevertheless,
Sanchez is not a strong leader, and
domestic pressure to continue a
hard line toward Honduras makes
it unlikely that he will change
his manner or his policy. 25X1
SECRET
WEEKLY SUMMARY 15 Aug 69
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 Approved For Release 2008/04/28: CIA-RDP79-00927AO07200080001-6
Approved For Release 2008/04/28: CIA-RDP79-00927AO07200080001-6
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SECRET
GUYANA: Foreign Territorial Claims
VENEZUELA
BRAZIL
?Matthewi
Ridge
GUYANA STILL WORRIED
maintenance of terri-
h
SURINAM
ABOUT PROTECTING ITS BORDERS
T
e f primary
torial integrity was o
concern to Guyana's senior dip-
lomats as they gathered at a for-
eign policy conference last week.
The meeting place itself was
significant; the diplomats chose
an interior town in the Essequibo
region of Guyana which is claimed
by Venezuela. The Guyanese are
Esse-
quibo to develop the
quibo because of its future eco-
nomic importance and to counter
Venezuelan attempts to subvert
the native Amerindians. Despite
Venezuela's peaceful protesta
tions, the Guyanese are still
fearful that the Caldera adminis-
tration might resort to military
action to recover its "lost" ter-
ritory.
Domestic pressure to resolve
the dispute and provide better
protection for Guyana's borders
may build in the next few weeks.
SECRET
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15 Aug 69
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