WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A007800010001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 46
• Document Creation Date: December 21, 2016
• Document Release Date: April 14, 2008
• Sequence Number: 1
• Publication Date: March 20, 1970
• Content Type: SUMMARY

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'/
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
OSD review completed
Secret
441,
20 March 1970
State Dept. review
completed
No. 0362/70
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SECRET
(Information as of noon EST, 19 March 1970)
VIETNAM
The government continues to take sharp actions
against political dissidence. South Vietnamese
operations touched off stiff fighting this week,
but there is no evidence to suggest that the Com-
munists have any early intention of abandoning the
low tactical profile they have maintained for more
than a year. t
NEW CAMBODIAN LEADERSHIP FACES UNCERTAIN DAYS
Serious difficulties may develop between the Cam-
bodian Government and the Vietnamese Communists in
the wake of the ouster of Prince Sihanouk as chief
of state.
NORTH VIETNAMESE PUSHING FAR INTO NORTH LAOS
Communist forces have driven well beyond the Plaine
des Jarres and threaten the major government head-
quarters at Long Tieng.
PHILIPPINE STUDENTS CONTINUE THEIR PROTESTS
Student agitation continues to take a violent bent,
and President Marcos has failed to make a convincing
show of being in command of the situation.
P age
1
Europe
THE WEEK IN PERSPECTIVE 9
USSR CAMPAIGNS PUBLICLY ON SALT ISSUES
The Soviets have been using the hiatus in the stra-
tegic arms talks to campaign publicly against US
programs for ABM and MIRV.
OSD review completed
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USSR CONDUCTS LARGE-SCALE MILITARY MANEUVERS
The Dvina maneuvers held in the western USSR early
last month as part of the Lenin Centennial probably
were the largest ever conducted by Soviet forces.
STALEMATE IN PEKING IRRITATES MOSCOW
The Peking talks are entering their sixth month with
no signs of progress and Moscow, seeing no hope for
improvement, is showing impatience.
PRIVATE ENTERPRISE: ALIVE BUT NOT WELL IN THE USSR
Private economic activity in the USSR is probably
thought by most Westerners to be either insignificant
or very important to the average Soviet citizen. The
truth, as usual, lies somewhere between the extreme
views. The Soviet economy is predominantly a social-
ized one, yet certain private economic activities are
permitted.
FALL IN SOVIET MEAT OUTPUT LEADS TO IMPORTS
In order to boost consumer welfare, Moscow already
has purchased about $88 million worth of meat from
the free world and additional contracts may be forth-
coming.
GERMANS FOCUS ATTENTION ON ERFURT SUMMIT
The West Germans believe that, at best, the Erfurt
talks will serve as an opening for more discussions
of the problems of a divided nation.
PRAGUE STIFLES DISSENTING INTELLECTUALS AND STUDENTS
Despite the "official" sympathetic attitude toward
disoriented intellectuals and students, hardliners
within the regime have begun to crush all resistance
in the cultural and academic communities.
SHARP SHIFT TO RIGHT MARKS FINNISH ELECTION
A pronounced swing to the right in the recent par-
liamentary election complicates Helsinki's relations
with Moscow and may lead to instability in the gov-
ernment.
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Middle East - Africa
USSR SENDS ADVANCED AIR DEFENSE MISSILE SYSTEM TO EGYPT 18
The Soviets are delivering and installing the SA-3
surface-to-air missile system in Egypt.
ISRAELIS ACTIVE MILITARILY ON ALMOST ALL BORDERS
The Israelis have avoided air strikes close to Cairo
since mid-February, but they have continued to hit
hard at Egyptian emplacements along the canal and in
the delta area, and have carried out helicopter-com-
mando raids deep into Syria, and in southern Lebanon.
LIBYA'S JUNTA REMAINS DIVIDED
The conflict between pro-Egyptian and "Libya first"
factions within the ruling Revolutionary Command
Council continues.
TENSION MOUNTS ON CYPRUS FOLLOWING POLITICAL MURDER
The murder of a prime suspect in the assassination
attempt on President Makarios raises the possibility
of reprisal attempts by supporters of the slain man
or other extremist groups.
Western Hemisphere
BRAZIL FEARS NEW KIDNAPINGS OF DIPLOMATS
Government and military officers fear that terror-
ists' successes in obtaining the freedom of comrades
by kidnaping foreign diplomats may stimulate similar
operations.
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PANAMA'S TORRIJOS MOVES TO BLUNT OPPOSITION
The inability of the government to eradicate plotting
has prompted strong-man General Torrijos to adopt a
hard line against the US and internal dissenters.
GOVERNMENT AND PRESS ON COLLISION COURSE IN PERU
Harsher measures may be in store for the Lima press,
but so far the government's attempts to intimidate
the press have resulted instead in more virulent
criticism of the Velasco regime.
SURINAM HAS NEW LEADER BUT SAME OLD PROBLEMS
The government's political and financial situation
has worsened, and racial tensions have risen.
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SECRET
The quandary that is Indo-China deepened considerably at mid-week
when the Cambodian Government ousted Prince Sihanouk as chief of state.
There now exists a danger that serious military activity involving Vietnamese
Communists will take place in Cambodia, especially if the government
attempts to carry through its proclaimed policy of ridding the country of
Vietnamese Communist troops. Sihanouk's acceptance and abetment of the
Vietnamese Communist presence in Cambodia was cited as the major reason
for his ouster, although the government leaders really acted to forestall what
they believed would be an attempt by the Prince to overthrow them. In
doing so, they not only departed radically from their cautious efforts to
undermine and isolate the volatile Prince, but also have thrown into question
such issues as the entire balance of power in the area.
In northern Laos, the North Vietnamese have passed up some easy
targets in order to concentrate their drive on Meo leader Vang Pao's head-
quarters at Long Tieng, southwest of the Plaine des Jarres. The Communists
obviously are trying to eliminate government bases within striking distance
of the Plaine in order to ensure their hold over this politically important
territory. Although the Communists appear to have the upper hand, the
tenacious Vang Pao is receiving reinforcements and appears ready to make an
effort to outlast a siege.
In South Vietnam, the only significant fighting has been the result of
South Vietnamese sweep operations mostly in the U Minh Forest area in the
southern delta. Otherwise, the Communists are maintaining their generally
low level of activity, emphasizing attacks on local pacification programs as
well as selective terrorism in both rural and urban areas.
The government in Saigon has taken further actions to still dissidence:
several student leaders were arrested as Viet Cong agents, and an issue of a
newspaper published by a strongly anti-Thieu Lower House deputy was
seized. The arrests could help coalesce student opposition to the govern-
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SECRET
VIETNAM
The Saigon government con-
tinues to take sharp actions
against political dissidence. Sev-
eral student leaders, including
the acting chairman of the anti-
government Saigon Student Union,
were arrested this week for al-
legedly cooperating with the Viet
Cong. Various student groups
which were already upset by gov-
ernment plans to charge tuition
in public high schools next year,
have protested the arrests and are
threatening further joint action.
Late last week the Ministry
of Interior ordered the seizure
of one issue of a newspaper pub-
lished by a strongly anti-Thieu
Lower House deputy on the grounds
that it sowed confusion within the
armed forces. The journal, which
had been suspended by the govern-
ment until just recently, contained
criticism of Vietnamization and of
Thieu, and discussed the "third-
force" concept which is anathema
to the regime.
President Thieu now holds the
land reform bill, which the Lower
House on 16 March finally passed
after being unable to vote down or
amend the Upper House's version.
Land reform was regarded as a pri-
ority item when the original gov-
ernment proposal was sent to the
Assembly last summer. President
Thieu may not sign the bill im-
mediately, however, but instead
may propose amendments for National
Assembly consideration that would
bring the bill more closely into
line with his original proposal.
Military Developments
South Vietnamese Army sweep
operations this week touched off
stiff fighting near the Demili-
tarized Zone and in the U Minh
Forest, a long-time Communist
stronghold in the southern delta.
The battles resulted in several
hundred enemy casualties compared
with only relatively moderate
government losses. The Communists
maintained a generally low level
of activity throughout most of
the country, emphasizing small-
scale attacks against local paci-
fication programs as well as
selective terrorism in both rural
and urban areas.
There is no evidence to sug-
gest that Hanoi has any early
intention of abandoning the low
tactical profile that has char-
acterized its operations for more
than a year. Communist main
force units holed up in border
base areas generally avoid contact
and remain on the defensive against
allied sweeps along infiltration
routes and through their jungle
sanctuaries. Indications of
enemy attack preparations that
are picked up appear mostly to
involve localized "high points."
There is little evidence of re-
gion- or corps-wide coordination.
A possible exception may be in
the works for the Communists' so-
called "anti-American" da on 19
March.
reports claim that e o
headquarters in South Vietnam
has called for widespread shell-
ings, sapper attacks, and urban
demonstrations to mark the occasion.
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SELKE"l
In I Corps, the large North
Vietnamese maneuver forces in the
DMZ area and along the western
Laotian border remain occupied
with logistical, training, and
reconnaissance activities. There
are few indications of enemy ef-
forts to reestablish a credible
military presence in the heavily
populated coastal area between
Hue and Quang Tri City. In the
coastal lowlands of central I
Corps, especially around Da Nang,
enemy local forces--whose plans
for offensive operations thus far
this year have been thwarted--are
reportedly now shooting for a late
March "upsurge."
In II Corps, major combat
units of the Communists'B-3 Front
command continue to maneuver in
Laotian and Cambodian border base
areas, but there are no indica-
tions that they plan offensive
action in the near future. On the
coast allied operations are con-
tinuing to keep the North Vietnam-
ese 3rd Division off balance in
Binh Dinh Province. In Phu Yen
Province, however, the enemy has
made recent inroads into the al-
lied pacification program with
successful local force opera-
tions against outposts and hamlets,
including the abduction of about
150 civilians for political re-
orientation purposes in the last
few weeks.
The enemy in III Corps remains
essentially on the defensive. Most
of the regiments attached to the
5th, 7th, and 9th Communist divi-
sions are sticking close to their
Cambodian border sanctuaries.
Communist forces in the subregions
around Saigon are now credited with
only a limited capability for con-
ducting harassing attacks.
In IV Corps, the enemy has
been doggedly trying to strengthen
its hard-pressed indigenous forces
with infusions of North Vietnamese
fillers as well as full North Viet-
namese regiments. All five regi-
ments transferred to the delta from
MIL`. It~[1
97953 3-70 CIA
SECRET
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SECRET
III Corps over the past nine months
have found infiltration exceedingly
difficult, however, because the ex-
posed terrain of the delta leaves
them vulnerable to strong pre-emptive
operations by South Vietnamese ground
forces supported by B-52 and tacti-
cal air strikes. Only one of the
five--the Viet Cong 273rd Regiment--
is believed to have actually reached
its final sanctuary, albeit with
heavy losses, in the U Minh Forest.
The North Vietnamese 88th Regiment
has apparently been trying to move
from near the Cambodian border
across the Plain of Reeds into Base
Area 470 west of My Tho since No-
vember. It has lost more than 400
men during infiltration attempts
across these open marshlands. Re-
cently, there have been reports that
North Vietnamese units are trying
to infiltrate southward from Cambo-
dia down the western coast of the
delta in sea-going sampans, in spite
of their obvious vulnerability, to
avoid the apparently greater dangers
of overland travel.
A copy of a recently captured
directive from the Communist head-
quarters in South Vietnam to the
major Viet Cong regional commands
in the delta strongly implies that
the Communists hope gradually to
rebuild their strength in the delta
by scoring a series of successes
in relatively small actions over
a period of many months, while at
the same time keeping open a wide
range of military and political
options.
In addition, the document
frankly admits that the unprece-
dented dispatch of North Vietnamese
troops to IV Corps was prompted by
the steady erosion of Viet Cong
assets in that sector since the lat-
ter part of 1968. The role of the
northern reinforcements according
to the directive, is to attack the
pacification program, help rebuild
local force units, and prepare to
take control of the civilian popu-
lation in the delta in the event
a political solution is found to
SECRET
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NEW CAMBODIAN LEADERSHIP FACES UNCERTAIN DAYS
The serious difficulties be-
tween the Cambodian Government
and the Vietnamese Communists may
become even graver in the wake
of the ouster of Prince Sihanouk
as chief of state. The unanimous
action taken by the national leg-
islature in Phnom Penh on 18 March
followed months of growing dis-
satisfaction with Sih anouk's
inter eren
in government programs. The of-
ficial explanation of the change
in leadership, however, laid re-
sponsibility for the current cri-
sis on Sihanouk's conciliatory
policies toward the Communists.
The government's decision to
move decisively against Sihanouk
at this time was a radical shift
from the slow nibbling away at his
power that had been going on for
the past six months. Prime Min-
ister Lon Nol apparently believed
that Sihanouk had decided, while
he was still in Paris, to over-
throw the government and replace
it with one that was responsive
to him. Believing that they could
count on the backing of the na-
tional assembly and many, if not
all, army commanders, Lon Nol and
Deputy Prime Minister Sirik Matak
apparently calculated that the
time was propitious for the move
against Sihanouk.
The Prince has long stated
that he would relinquish the reins
of power if that is what the Cam-
bodian people wanted. If the army
is as loyal to the new government
as it now appears and if Sirik
Matak and Lon Nol are determined
to have their way, Sihanouk faces
a tough road if he decides to try
to appeal to the Cambodian people.
A crucial question will be the
timing of actions on both sides,
25X1
25X1
At the time of his ouster,
Sihanouk was in Moscow and head-
ing for Peking in an attempt to
gain support for his own position
by having those powers exert in-
fluence on the Vietnamese Commu-
nists to withdraw their troops
from Cambodia. The Soviets, al-
though concerned about develop-
ments in the region, did not, how-
ever, come up with anything more
than support for Cambodia's neu-
trality and promises of additional
aid. F_ I 25X1
SECRIJ'
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Awl
SECRET
AREA OF
MAIN MAP
LAOS: Current Situation
Na
Khan
Bouam
Longs
gala _ e.a Luan1
hou Houei
houn Ki Nin
Refugees
moving
into area
ang Vieng
\B an
Ban Na.
jrXigrtj Khouang
JARRES Q
Sarn ThaTam
Thong' a Bleung
Khang
41(ho
"I - I 'Threat by
Long* NVA forces
Tiefg`-:
10 20 Miles
1,0 glom r
10 20 Kilometers
SECRET
? Government-held location
? Communist-held location
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Now SECRET
NORTH VIETNAMESE PUSHING FAR INTO NORTH LAOS
The Communist military of-
fensive has moved well beyond
the Plaine des Jarres and threat-
ens to engulf the government
headquarters at Long Tieng. On
16 March a two-battalion North
Vietnamese force overran Tha Tam
Blueng, a key defensive position
guarding the approaches to Gen-
eral Vang Pao's headquarters
area. Without waiting to con-
solidate their new gains, the
North Vietnamese pushed south
and captured the government refu-
gee center at Sam Thong. Vang
Pao has pulled some of his troops
out of the more exposed positions
at Ban Na and Khang Kho in order
to defend Long Tieng. In addi-
tion, Commander in Chief General
Ouan has ordered the airlift of
reinforcements from south Laos
into the area in order to stiffen
Vang Pao's weary ranks.
Complicating Vang Pao's de-
fense is the wholesale evacuation
of the Meo community from the
area. Many government soldiers
have joined the refugee ranks,
the bulk of which are moving to
Ban Son, about 20 miles to the
southwest. Although sentiment
is strong within the Meo commun-
ity to resettle in the quieter
areas of Sayaboury Province, Gen-
eral Vang Pao will probably at-
tempt to regroup his forces in or-
der to block further enemy ad-
vances toward the Vientiane Plain.
Meanwhile on the political
front, Prime Minister Souvanna
has softened his public position
on a cease-fire agreement with
the Communists. During a press
interview on 13 March, Souvanna
said he would be willing to ac-
cept a cease-fire before a North
Vietnamese troop withdrawal, pro-
vided the enemy stopped all of-
fensive activity and permitted
the International Control Com-
mission to send observers into
Communist-controlled terri-
tory.
IThe prime minister
also reiterated the stand he has
taken recently in public and
private that bombing the infil-
tration corridor would be a mat-
ter for the Americans to decide.
It is not clear what effect the
Communist campaign against Long
Tieng will have on Souvanna, but
he will probably be under con-
siderable pressure from rightist 25X1
elements to forgo any political
initiatives with the Lao Com-
munists at this juncture.
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PHILIPPINE STUDENTS CONTINUE THEIR PROTESTS
Student radicals continue
to expand their influence in the
protest movement. They managed
to turn an initially peaceful
demonstration in Manila on 17
March into disturbances that re-
sulted in the death of one person.
Students who marched on the US
Embassy were scattered before do-
ing any damage, however, and
another group that headed for the
presidential palace was turned
back by Philippine armed forces.
Although radicals, encouraged
to some extent by the government,
have imparted a strong anti-US
cast to student agitation, Presi-
dent Marcos remains the focus of
student dissatisfaction. Demon-
strators among a mass rally of
some 3,000 persons on the 17th
conducted a mock trial that found
Marcos guilty of corruption in
the presidential elections last
November.
The size of the rally fell
far short of what, its organizers
hoped for. Radical and moderate
students are increasingly at odds
over the use of violence, and
moderates apparently stayed away
in anticipation of trouble. De-
spite their internal squabbling
and the lack of public backing,
however, the students will be en-
couraged by Marcos' failure to
take command of the situation and
will continue their pressure on
him. Their persistent challenges
may yet force him to make more
concessions.
Press coverage of student
activities remains exhaustive,
but public interest appears to
be dwindling. The spectacle in
the latest demonstrations of a
"people's tribunal" dispensing
revolutionary justice will further
lower the public's opinion of the
student movement and will help
Marcos in his efforts to discredit
it.
Marcos has emerged slightly
from the isolation he has main-
tained since the outbreak of stu-
dent protests in late January,
but a sign of uneasiness can be
seen in his keeping public appear-
ances to a minimum. In a recent
series of addresses to the na-
tion he has made an unconvincing
effort to assure the electorate
of his-commitment to reform. The
thrust of his remarks was that
the government would take steps
to bring revolution from the top
rather than to permit rebellion
from below. Although he made a
welcome admission that changes
are needed, Marcos' condescend-
ing tone toward students and his
failure to mention any specific
programs will reinforce public
skepticism. The general response
to his promises is that the time
for words is past and that deeds
are now demanded.
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N"e SECRET
Soviet policy in the Middle East has reached a turning point with the
recent appearance of SA-3 surface-to-air missiles in Egypt. No longer simply
a source of arms supply for the Arabs, the Soviets have now taken on the
role of active combatant in their behalf. Israeli raids on these missile defenses
could prompt the Soviets to take riskier measures to protect their policy
investment.
Moscow seemed surprised and dismayed by the ouster of Sihanouk.
Though the Soviets would probably like to see him restored, they recognize
that there is little they can do to affect developments. If Sihanouk fails to
return to power, Moscow will probably be content to follow Hanoi's lead in
dealing with the Cambodian Government.
On 19 March Chancellor Brandt became the first West German head of
government to meet with his East German counterpart when he traveled to
Erfurt for talks with Premier Stoph. Hopes for progress were slight, but the
two did agree to meet again in West Germany.
Western reaction continues reserved to the Romanian proposal for a
preliminary meeting in Bucharest to discuss a conference on European
Security. The Romanians apparently informed their Warsaw Pact partners in
advance, but failed to win their approval. The Soviets have made no com-
ment.
Hungarian Premier Fock and his economic and planning experts were
abruptly summoned to Moscow on 17 March. Both sides have portrayed the
visit as routine, but it was announced that "political questions" were
discussed, and there are suspicions that the Hungarians once more had to
account for their far-reaching proposals for economic and CEMA reform.
The European Communities (EC) and Yugoslavia formally signed a
bilateral trade agreement in Brussels on 19 March-the first such accord
between the EC and a Communist state. Belgrade, in a further deviation from
the Soviet policy of nonrecognition of EC, reportedly will establish a mission
to the Communities later this year.
Former Italian premier Fanfani has decided that he will be unable to
undertake the formation of a government. President Saragat is turning to the
caretaker premier, Mariano Rumor, for consultation. Saragat may intend to
ask Rumor to withdraw his earlier resignation and ask parliament for a vote
of confidence enabling him to continue his minority Christian Democratic
government.
The International Federation of Airline Pilots' Associations this week
increased pressure for better international measures to assure air safety and
called for a ban on flights to and from countries that do not crack down on
aircraft hijackings and sabotage. An international conference of governments
is not expected to act on these areas before June, when it meets under
auspices of the International Civil Aviation Organization
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SECRET
USSR CAMPAIGNS PUBLICLY ON SALT ISSUES
The USSR has been using the anxieties are real, Moscow is cer-
hiatus in the strategic arms talks tain to surface them in one form
to campaign publicly against US or another at Vienna.
programs for ABM and MIRV. The
Soviet press is saying that these
weapons systems threaten a new
stage in the arms race and must
be curbed. Moscow's arguments
seem designed to put the blame
on the US should the forthcoming
Vienna talks fail or bog down.
In private, however, Soviet spokes-
men have shown little consistency
on possible SALT issues. Neither
public nor private statements
have attempted to set precondi-
tions for the negotiations that
are to begin on 16 April.
A Pravda article of 7 March,
signed "Observer" to mark its
high-level endorsement, has been
the most authoritative indication
to date that the US Safeguard pro-
gram may be causing Soviet SALT
planners considerable difficulty
at this time. Several weeks be-
fore, Defense Minister Grechko
broke a one-and-a-half year press
ban on Soviet claims to an ABM
capability. This gesture was
partly responsive to the recent
US announcement of plans to expand
Safeguard. Whether or not these
Page 10
The Soviets were, for the
most part, silent at Helsinki on
the subject of MIRVs and until a
short time ago press references
on the subject were rare. A Red
Star article on 14 March stated
that the US decision on MIRV "seri-
ously endangers" SALT. It was the
strongest Soviet press condemnation
to date of MIRV deployment in the
US, but it softened its criticism
by focusing on the Pentagon and
not on the administration.
Although it has become in-
creasingly clear that the Soviets
are disturbed about US plans for
deployment of ABM and MIRV, there
have been no clues as to what Mos-
cow's position on these matters will
be when talks resume. The Soviets
are still willing to permit their
commentators to warn of the poten-
tially harmful effects of US weapons
programs on SALT without committing
Soviet policy to these warnings.
Also, some Soviet officials have
claimed that Moscow is interested
in an early agreement.
ECRE'I'
WEEKLY SUMMARY 20 Mar 70
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NNOW SECRET
USSR CONDUCTS LARGE-SCALE MILITARY MANEUVERS
The Dvina maneuvers held in
the western USSR as part of the
Lenin Centennial probably were the
largest ever conducted by Soviet
forces. According to Soviet press
announcements, the exercise in-
volved river crossings, simulated
nuclear strikes, a helicopter as-
sault, and an airdrop by some
8,000 troops. Some reservists--
and possibly civilian trucks--re-
portedly were mobilized for the
exercise.
Moscow announced the maneuvers
on 27 February and on 3 March, the
Soviet press reported that large
numbers of troops had begun to con-
verge on the exercise area.
Later Soviet press reports in-
dicated that troop trains, truck
convoys, and transport aircraft--
including heavy AN-22 transports--
brought more troops into the area.
The exercises were directed by De-
fense Minister Grechko and observed
by other top military officials.
In response to a southern coun-
terattack on 12 March, the northern
forces simulated the use of nuclear
weapons. Southern forces then re-
taliated in the same way. More than
1,000 tanks--the equivalent of three
tank or five motorized rifle divi-
sions--reportedly took part in the
battle. The southern forces appar-
ently began to turn the tide of bat-
tle on 12 March and tactical exer-
cise activity ended the next day.
Apost-exercise parade held in
Minsk on 15 March was attended by
party chief Brezhnev and other top
Soviet officials.
The actual number of troops
involved in the exercise is not
clear. The Soviets identified five
divisions by name--probably one each
from the Baltic, Belorussian, Moscow,
Leningrad, and North Caucasus mili-
tary districts. 25X1
Tactical exercises got under
way on the morning of 10 March.
The scenario apparently involved
an attack by "northern" forces--
presumably representing NATO--
against "southern" forces over
the Zapadnaya Dvina River. North-
ern forces, under air cover, re-
portedly crossed the river after
helicopter-borne troops were landed
behind the southern defenders.
On 11 March, the Soviets an-
nounced that almost 8,000 troops and
160 pieces of heavy military equip-
ment had been airdropped apparently
in a single operation. An airdrop
of that size would require over 300
AN-12 transports.
(J g`''alJ
Soviets Conduct Large-Scale
Military Maneuvers
ELORUSSIAN
MD U
SECRET
Page 11 WEEKLY SUMMARY
A Division Identified
In Soviet reporting
t_ Rostov
CAUCASUS
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STALEMATE IN PEKING IRRITATES MOSCOW
The Peking talks are entering
their sixth month with no signs of
progress. Moscow, seeing no hope
for improvement, is evidencing im-
patience with the stalemate. A
TASS statement on 14 March put on
record Moscow's denial of "imperi-
alist" rumors that the Soviet Union
is engaged in "major military ac-
tivities" in preparation for an at-
tack on China. Though the state-
ment appears designed. to refute Chi-
nese charges that the Soviets are
forcing them to negotiate under mil-
itary pressure, it backhandedly
serves to remind Peking that Moscow
retains a military option despite
its commitment to a political set-
tlement.
Peking, by contrast, has main-
tained a comparatively low-keyed
political posture in recent weeks,
presumably in order to counter Mos-
cow's charges of Chinese intransi-
gence and to avoid giving the So-
viets a pretext for downgrading or
suspending the talks. In addition,
recent indicators point to some
Chinese uneasiness over possible
developments if the border talks
collapse. Last week, for instance,
a Chinese broadcast highlighted in
unusually grim detail the "present
danger" of nuclear war, and recently,
Chinese officials abroad have in-
creased efforts to get information
on Soviet military strength and in-
tentions along the border.
of frontier incidents in recent weeks
cannot be directly confirmed. Never-
theless, the TASS statement did not
disavow them and Soviet propaganda
claiming that its border forces are
in a state of "constant readiness"
indicates that Moscow remains un-
happy with the unsettled situation
on the frontier.
Recent movements in Sino-US re-
lations have irked the Soviets, who
have charged the Chinese with at-
tempting to use the Warsaw talks to
gain "an upper hand" in the Peking
negotiations. Although the Soviets
probably think an immediate Sino-US
rapprochement unlikely, they clearly
resent Peking's successful efforts
to break out of its diplomatic iso-
lation.
Despite the misgivings, the So-
viets stress
their intention to con roue the talks. 25X1
They are communicating their side of
the dispute to other Communist par-
ties and have apparently pressed
their East European allies to engage
in a unified anti-Chinese propaganda
campaign.
SECRET
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FALL IN SOVIET MEAT OUTPUT LEADS TO IMPORTS
After an impressive growth
in meat output in the Soviet Union
during 1965-67, production in 1968
leveled off, and then declined in
1969 an estimated three to five
percent. Per capita consumption
of meat fell by four percent last
year. So in order to boost con-
sumer welfare in this centennial
year of Lenin's birth, the Soviet
Government has decided to import
substantial quantities of meat
from the free world.
The decline in meat produc-
tion last year was caused primarily
by the severe winter of 1968-69
that killed abnormally high numbers
of livestock, a reduced supply of
feed per head, and a new govern-
ment policy to forgo slaughtering
in order to expand the size of
herds as well as the number of
farms keeping livestock. During
the last several years hasty
"specialization" of livestock pro-
duction on fewer farms had caused
an excessive reduction in herds.
The diminished supplies of
meat came as a surprise to Soviet
consumers, who had expected bet-
ter quality foods to continue to
replace the traditional starchy
staples. Higher incomes exacer-
bated the demand, resulting in
long queues in state meat stores
and rising prices in the collec-
tive farm market, the only market
in the country where prices reflect
changes in demand. Prices on the
Moscow collective farm markets rose
16 percent from January 1969 to
January 1970. Moreover, there were
reports of prolonged periods when
meat was not available in state
outlets of some urban centers.
In order to alleviate this
shortage in this "Jubilee Year,"
the Soviet Government is reported
to have purchased about 121,000
tons of meat worth $88 million
from the free world. More con-
tracts may be negotiated in the
near future. Since 1966, the So-
viets have been net exporters of
meat, trading mainly with East
Germany and Czechoslovakia. Im-
ports, also from East European
countries, have been relatively
small. In 1970, however, the
Soviet Union will again be a net
importer and will pay scarce for-
eign exchange to free world coun-
tries. Eastern Europe has been
unable to come to the rescue as
livestock production there also
stagnated or declined in 1968-69.
The outlook for a marked in-
crease in meat production in the
first half of 1970 is dim. Large
supplies of feed to fatten the
present herds are not available.
Moreover, the number of livestock
will probably be expanded this
year at the expense of short-run
gains in meat output. If pur-
chases from the free world reach
$100 million, the per capita sup-
ply for inhabitants of urban cen-
ters of over 100,000 could rise
by as much as ten percent in the
first half of the year compared
to the same period in 1969.
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GERMANS Focus ATTENTION ON ERFURT SUMMIT
A milestone in East-West Ger- this position but did not rule
man relations was reached on 19 out a discussion of Brandt's
March when Premier Stoph and Chan- counterproposals.
cellor Brandt met in Erfurt.
The Bonn leadership saw in
this first-ever dialogue between
the two heads of government evi-
dence that its Eastern policy was
working. At the same! time, Brandt
and his deputies warned against
lofty expectations and held to
the line that, at best, Erfurt
will serve as an opening for more
discussions of the problems of a
divided nation.
In the negotiations proper,
the West Germans were prepared
to present measures that would
alleviate tensions and improve
transportation and communication
links. Anticipating that Stoph
would press for outright recog-
nition through the medium of his
government's standing draft treaty
proposal, the West Germans made
clear on the eve of the talks
that this was more than they were
willing to grant. They hoped
that the East Germane would agree
to designate representatives to
study inter-German problems and
to prepare for another meeting.
Brandt and Stoph have agreed to
meet again in West Germany, ac-
cording to late press reports.
Extensive commentary in East
German mass media continued to
stress Pankow's demand that Brandt
discuss the draft treaty. SED
leader Walter Ulbricht, in an in-
terview on 17 March, re-emphasized
In Moscow, special emissary
Bahr wound up another round in
his prolonged series
that the two si es had gone "a
good bit" forward and that the
exploratory phase, looking to an
eventual renunciation of force
agreement, could be completed in
one more meeting. Bahr enplaned
for Bonn on 16 March for consul-
tations but was expected to re-
turn on 20 March and resume talks
the next day.
Signs of progress in the
second round of West German - Po-
lish political talks were lack-
ing. State Secretary Duckwitz,
the chief German negotiator, re-
turned from Warsaw on 12 March
and said only that another round
would be held in the second half
of April. Meanwhile, two senior
Bonn officials arrived in the
Polish capital on 15 March in an
apparent effort to inject new
life into the faltering talks on
a long-term economic agreement.
The subsequent announcement that
the two sides had settled on a
one-year trade protocol led to
the conclusion, later confirmed
by the West Germans, that the
gulf between Polish expectations
and German offers had not been
bridged and that a hiatus in
talks would ensue.
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PRAGUE STIFLES DISSENTING INTELLECTUALS AND STUDENTS
Officially, the Husak lead-
ership has adopted a sympathetic
attitude toward "disoriented" in-
tellectuals and students. In re-
ality, however, orthodox party
and government officials, par-
ticularly in the Czech lands,
have begun an extensive campaign
to crush all resistance in the
cultural and academic communities.
The Czech minister of cul-
ture has declared that intellec-
tuals and artists no longer pos-
sess a special status in society,
and must, along with other peer
social groups, proclaim their
support for party policies. He
has demanded that the cultural
unions expel those members who
have defected to the West and
rescind the anti-Soviet proclama-
tions they adopted in the after-
math of the invasion in 1968.
The Czech regional party,
which already abolished one defi-
ant union, has announced plans to
seize the dissident Czech writers'
union. The Ministry of Culture
intends to take charge of the
writers' publishing house and
recreation center and to adminis-
ter the union's funds. This sug-
gests that the union probably will
be permitted to exist, but that it
will be allowed to subsidize only
those members who support the re-
gime. Other cultural groups, such
as the theater and architectural
unions, face similar reprisals.
Meanwhile, the Czech minister
of education recently proposed
that the entire academic system
be reorganized to stress the
"class approach," a setup used
during Czechoslovakia's Stalinist
era in the 1950s. He suggested
that students whose parents are
workers or farmers receive a
higher education without cost or
entrance examinations; in contrast,
only a small group of children of
intellectuals would be granted
similar benefits.
The minister also has called
for the dismissal of all students
and teachers who supported the
Dubcek reforms and denounced the
invasion. Special commissions
have been set up to punish stu-
dent radicals, and an elaborate
scheme to monitor teachers through
assignment rotations is in the
planning stage. Courses in Marx-
ism-Leninism, suspended during
the Dubcek period, were rein-
stated in the schools last month.
Regime spokesmen have ac-
knowledged that "normalization"
in the cultural and academic
spheres is a long way off. The
bureaucracy's harshly orthodox
approach is unlikely to speed
the process and will only widen
the gulf between the regime and
the majority of intellectuals,
artists, and students. 25X1
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SHARP SHIFT TO RIGHT MARKS FINNISH ELECTION
A pronounced swing to the
right in Finland's parliamentary
election on 15-16 March compli-
cates Helsinki's relations with
Moscow and may lead to instability
in the government..
The conservative National
Coalition Party and the radical
right Rural Party were the only
ones to increase their share of
the vote over 1966. They added
11 and 17 seats respectively to
their representation in the 200-
seat parliament. The 10.5 per-
cent of the vote obtained by the
Rural Party, the highest ever
garnered by a far-right group in
Finland, represents a surpris-
ingly strong surge of protest
among rural elements against the
establishment in general and the
modernized outlook of the Center,
formerly Agrarian, Party in par-,
ticular.
All parties participating
in the center-left government
lost ground, with the heaviest
losses suffered by the Center
Party and the Communist-dominated
People's Democratic League. Both
fell below 20 percent of the vote
for the first time since World
War II. Moreover, the left splin-
ter Social Democratic League,
which ran on a joint ticket with
the People's Democrats, was vir-
tually wiped out, failing to
gain a single seat. Communist
losses will intensify the split
between liberal and conservative
forces in the party, with both
sides blaming the other for the
loss of voter confidence. The
losses among Prime Minister Koi-
visto's Social Democrats were
more moderate, and they remain
the largest single element in
Parliament.
The dramatic shift in voter
sentiment indicates there is
greater dissatisfaction with the
policies and performance of the
government than had been assumed,
especially among the so-called
"forgotten men" who have not
shared in the country's rise in
prosperity. A significant seg-
ment of the Finnish public may
also have used its vote to reg-
ister disapproval of the govern-
ment parties' competition for
Soviet favor. In this context,
the government's frequent rever-
sals on the question of Finland's
participation in the proposed
Nordic Economic Union (NORDEC)
amidst rumors of Soviet pressure
may have contributed to public
disenchantment.
The combined strength of the
government parties, while down to
136 seats from 165, is still suf-
ficient to retain control. More-
over, the Soviets who have already
expressed unhappiness over the
outcome and who regularly assume
the right to pass on the accept-
ability of Finnish political com-
binations, will probably insist
on continuation of the present
center-left grouping. This prob-
ably will not sit well with many
Finns. The conservative opposi-
tion takes the view that a renewed
center-left coalition would be a
government of losers and would
therefore be contrary to the will
of the electorate. Indeed, three
cabinet members, one of whom was
previously regarded as possible
successor to Prime Minister Koi-
visto, were defeated in the elec-
tion, as was the liberal Communist
Party chairman.
` ,'CRE'1'
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'..1 SECRET i"Oly
The USSR has sent the SA-3 surface-to-air missile system to Egypt, and
at least 128 missiles have recently been sighted in the country. In other
military activities in the area, the Israelis continued to direct air strikes
against Egyptian targets along the Suez Canal while avoiding the Cairo area.
The Israelis conducted their first commando raids into Syria on 15 and 16
March, and also raided into southern Lebanon on 18 March.
The Israeli-leased Canadian oil drilling rig that was damaged while in
port in the Ivory Coast, probably by Egyptian saboteurs, is now in Tema,
Ghana. It is expected to be in drydock there for permanent repairs, which
could take over a month. Before the rig reaches its eventual destination in
the Gulf of Suez, the Egyptians could make another attempt to destroy it.
The UN Security Council's decision this week to extend already-exist-
ing mandatory economic sanctions to include all of Rhodesia's transport
links with the outside world will have little effect on the Smith government
and a minimal impact on the Rhodesian economy. Salisbury can move the
bulk of its trade over railroad links with Portuguese Mozambique and South
Africa, neither of which enforces any sanctions.
Nigeria's military rulers have advanced their reconstruction program by
decreeing a new formula for allocating federal revenues. The share going to
the states will be increased and will be distributed more equitably. The new
system reflects the political pre-eminence of the country's minority tribes,
and further strengthens their position over the three major tribal groups.
Serious violence, sparked by the radical Communist Party/Marxist,
erupted in the Indian state of West Bengal this week. The Marxists, who had
dominated the governing coalition there, were protesting the resignation of
the non-Communist chief minister, who had nominally led the coalition. The
army has been sent in to maintain order and the central government has
taken over administrative control.
The Turkish political situation was at least temporarily stabilized by the
government's marginal vote of confidence on 15 March, but new elections
remain a distinct possibility. Meanwhile, leftist student extremists have
unleashed a new campaign of anti-Americanism, marked by attacks on US
property. This could place added strains on the already-weakened govern-
ment because of the increasing popular criticism of alleged reluctance to
crack down on student violence.
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USSR SENDS ADVANCED AIR DEFENSE MISSILE SYSTEM TO EGYPT
25X1
The Soviets are delivering and
installing the SA-3 surface-to-air
missile system in Egypt. They also
intend to man it.
Thus far, it appears that the
SA-3 will be used in conjunction
with the SA-2 system already in
Egypt. The SA-3 can operate at al-
titudes down to about 300 feet com-
pared with 1,500 feet for the SA-2
and probably will initially provide
point defense for targets in the
Cairo and Alexanria areas.
The SA-3 system heretofore has
been deployed only in the USSR and
Eastern Europe where it has been
manned exclusively by Soviet person-
nel. In order to provide an effec-
tive operational system rapidly in
Egypt, Soviet personnel will have to
man and operate the SA-3's. Manned
by Soviet personnel, the sites prob-
ably could be put into operation
within about 48 hours. Egyptian
personnel may be trained. later to
operate the system but this would
require at least four to six months.
The Soviets may supply other
equipment in the present program.
Some form of antiaircraft artillery
probably will also be brought into
Egypt to provide a defense at alti-
tudes up to 300 feet.
Appearance of the SA-3 marks a
turning point in Soviet policy in
the Middle East, for Moscow has aban-
doned its role simply as a source of
supply for the Arabs and has become
an active combatant in their behalf.
The Soviets probably believe, how-
ever, that they have carefully cal-
culated and limited the possible
dangers. Nevertheless, this step
demonstrates that they are prepared
to take additional risks to assure
the success of their policy in the
Middle East.
The introduction of the mis-
siles into Egypt probably will not
deter the Israeli Air Force from
?Soviet SA-3 Missile
SECZFT
Page 18 WEEKLY SUMMARY 20 Mar 70
140 lbs
about
about 60,000 ft
about 300 ft
Mach 2.5
command
about 30 ft
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Nftpl~ SECRET
continuing its current campaign of
deep penetration raids. Militar-
ily, the Israelis feel confident
they can cope with the newer mis-
sile, even though manned by Sovi-
ets. Politically, they think it
would be unwise to let the Arabs
believe they can find sanctuary
under a Soviet umbrella. The Is-
raelis probably will seek out the
SA-3 sites to destroy them, rather
than avoid them and look for other
targets.
ISRAELIS ACTIVE MILITARILY ON ALMOST ALL BORDERS
Israeli leaders, perhaps re-
flecting some apprehensions about
the expected US decision on fur-
ther aircraft sales, appear to
have scaled down the intensity
of their military attacks a few
degrees. Bad weather may also
have been a factor. The Israeli
military still saw some action:
they carried out helicopter-com-
mando raids deep into Syria; con-
tinued to attack Egyptian posi-
tions along the west bank of the
Suez; and responded to continuing
fedayeen activity on the border
with Lebanon. They have not car-
ried out any air raids near Cairo
since 12 February, the closest re-
cent raid being a strike on an
SA-2 site some 20 miles west of
the city on 26 February.
In response to stepped-up
Syrian harassment in the occupied
Golan Heights area, the Israelis
raided deep into Syria on 15 and
16 March. Commandos destroyed a
high-tension power line 12 miles
northeast of Damascus, and shelled
an army camp 24 miles north of the
Syrian capital. They also de-
stroyed a small bridge and two
Syrian pillboxes six miles be-
yond the cease-fire lines. The
Israelis have previously used air-
craft in strikes at targets in
Syria, but this is the first time
since the war that they have sent
helicopter-borne commandos, al-
though these units have frequently
been used against the Egyptians.
SECRET
Page 19 WEEKLY SUMMARY
Israeli-Lebanese tensions
over fedayeen cross-border activi-
ties have continued, and the Is-
raelis on 18 March carried out
their second "warning" raid into
southern Lebanon since early
March. There was evidence, how-
ever, that the Beirut government
was trying to move the fedayeen
out of the central section of the
border area and to get them to
moderate their activity. There
were fragmentary reports of a
clash between Lebanese soldiers
and the fedayeen.
Although they have avoided
targets close to Cairo, Israeli
aircraft continue to pound Egyp-
tian emplacements along the Suez
Canal on an almost daily basis.
On 13 March, the Israelis struck
at an SA-2 site at El Mansura in
the delta area some 75 miles
northeast of Cairo. On two suc-
cessive days later on, the Is-
raelis carried out other raids
15 to 20 miles west of the canal.
In the process, they knocked down
another Egyptian MIG-21, raising
the Israelis' score since the
1967 war to 76 Egyptian aircraft,
at a cost of only 11 losses in
Egypt of their own. Over the
weekend, Israeli commandos crossed
the northern sector of the canal
and reportedly destroyed an Egyp-
tian bunker and its weapons.
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LIBYA'S JUNTA REMAINS DIVIDED
The conflict between pro-
Egyptian and "Libya first" fac-
tions within the ruling Revolu-
tionary Command Council continues.
Last month, the Libya first
faction apparently prevented
Libyan attendance at the meet-
ing of "Front Line" Arab states
in Cairo. On the other hand,
the pro-Egyptian faction report-
edly stopped the Libyan delega-
tion from going to the Maghreb
economic ministers' conference,
which was to have been held last
week in Rabat but was canceled
at the last minute. The pro-Egyp-
tian council members probably be-
lieved that attending the Maghreb
conference might have implied that
Libya was aligning itself more
closely with the relatively mod-
erate North African states and
SECRET
Page 21 WEEKLY SUMMARY
was swinging away from the more
radical Arab states led by Egypt.
In any case, the regime has
been forced to cut back on its
international activities and to
concentrate on domestic problems,
a course that has long been ad-
vocated by the Libya first fac-
tion. This change of emphasis
is probably too late, however,
to reverse the growing un o u-
larity of the regime.
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TENSION MOUNTS ON CYPRUS
Just a week after the unsuc-
cessful attempt on President Ma-
karios' life, tensions on Cyprus
were raised even higher by the
still-unexplained murder of ousted
Interior Minister Georkatzis on
15 March. Makarios has moved
swiftly to squelch rumors that
Greek mainland officers were in-
volved, and has labeled as a for-
gery a document allegedly prepared
by Georkatzis for delivery to him
in the event of Georkatzis' mur-
der.
The Greek-Cypriot population
is becoming increasingly frag-
mented. Makarios' image was
greatly enhanced by his near-
miraculous escape from death, but
he will now be tarnished by his
association in the public mind
with the murder of his former as-
sociate Georkatzis, who was a popu-
lar hero. Various extremist groups,
who may be happy to see Georkat-
zis dead, will not necessarily
rally to the archbishop's sup-
port. Groups such as the National
Front, which favors union with
Greece (enosis), see Makarios
as a stumbling block in their
path. Other groups, ranging
across a broad political spec-
trum, seem now to view the arch-
bishop more and more as a self-
serving--if wily--politician.
Although security precau-
tions around Makarios have been
greatly increased in recent days,
FOLLOWING POLITICAL MURDER
he is by no means safe from future
attempts on his life, either from
the ex-guerrilla followers of the
murdered Georkatzis or from other
quarters. The loyalty of the po-
lice, the security forces, the Na-
tional Guard, and even the palace
guard is questionable. Without a
personal following of armed par-
tisans, and with his image as the
embodiment of Hellenistic national-
ism on Cyprus no longer quite
credible, Makarios will be forced
to rely on his skill in playing
off one faction against another.
If the intracommunal strife
among the Greek Cypriots reaches
a point where Makarios believes
that the stability of his regime
is seriously threatened, he might
be tempted to move against the
Turkish Cypriots in an effort to
reunite his quarreling country-
men against the common enemy. Up
to now, the Turkish Cypriots have
managed to avoid involvement in
the turbulent developments on the
is land.
Despite Makarios' quick
denial of any involvement of
Greek officers in the events of
the last ten days, he must be
deeply suspicious that at least
some members of the Athens regime
would like to remove him. His
efforts to paper over the rift
between himself and the Athens
government are a measure of his
dependence on Greece as a deter-
rent to Turkish moves against his
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The recent spectacular kidnaping episodes in Guatemala and Brazil have
found would-be emulators in other Latin American countries.
Colonel Carlos Arana is expected to be confirmed as president-elect of
Guatemala by the incumbent congress within the next few days. Arana, who
received a plurality of the popular vote in the elections on 1 May, but not
the required majority, has pressed for early resolution of the election results.
The second stage of the election now belongs to the legislature, but the
constitution is unclear as to whether the selection should be made by the
incumbent or by the newly elected congress.
Arthur Chung has been elected as the first president-a figurehead
position-of the Guyana Cooperative Republic. Chung, a Chinese, was
selected by Prime Minister Burnham to avoid antagonizing the Negroes and
East Indians who constitute the bulk of the population.
In Peru, the newspaper Expreso, which has become a spokesman for the
radical left since its operations were turned over to Communist-dominated
unions following expropriation by the government on 3 March, has called on
workers to form "Committees for the Defense of the Revolution." These
committees presumably would be pressure groups designed to make sure the
government presses forward with its "national and social liberation of Peru"
and to turn in persons who oppose "the revolution." A like-minded com-
mittee at Expreso precipitated the government's expropriation of the paper.
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BRAZIL FEARS NEW KIDNAPINGS OF DIPLOMATS
Government and military
officials fear that terrorists'
successes in obtaining the free-
dom of comrades by kidnaping
foreign diplomats may stimulate
similar operations. The abduc-
tion last week of the Japanese
consul general in Sao Paulo and
his exchange for five Brazilian
prisoners come only six months
after 15 prisoners were released
to secure the safe return of US
Ambassador Elbrick.
The kidnapers of the Japa-
nese official identified them-
selves as members of the Popular
Revolutionary Vanguard (VPR), a
terrorist group led by renegade
Army Captain Carlos Lamarca, who
is probably the country's most
effective terrorist leader. On
13 March the government accepted
the terrorists' terms, and the
next day it flew the designated
prisoners to Mexico. The Justice
Ministry issued a decree banish-
ing the five from Brazil, follow-
ing a precedent established in
the Elbrick incident. The consul
general was released in good
condition on 15 March.
robberies, as was the other VPR
prisoner, a second generation
Japanese-Brazilian. A third
terrorist was formerly a body-
guard of Carlos Marighella, who
led the National Liberating
Action until he was killed by
police last November. A fourth
prisoner released was a Francis-
can nun, who last October, while
at her orphanage in Sao Paulo
state, was arrested for assisting
a National Liberation Armed Forces
group. The local police chief
was subsequently excommunicated
as a result of accusations that
the nun and other prisoners had
been tortured while in jail.
She denied any knowledge of
subversive activities, and pro-
tested against being put on the
plane to Mexico. The other
prisoner, also a female, who de-
cribed herself as a "Marxist-
Communist," was the widow of a
VPR militant killed last month.
She was accompanied by three
children; a fourth child, who
reportedly was involved with his
father in terrorist activities,
remains at large in Brazil.
Three of the prisoners
admitted to reporters in Mexico
that they had worked with terror-
ist groups in Sao Paulo; all had
received training in Cuba. Of
the two who claimed to be activ-
ists with the VPR, one reportedly
was involved in three major
operations in Sao Paulo during
1968, including the assassination
of a US Army captain. He was
also implicated in numerous bank
There was substantial
dissatisfaction among lower rank-
ing military officers about the
government's exchange of 15 pris-
oners for US Ambassador Elbrick
last September, and the new
episode is likely to provoke
similar unhappiness. The fact
that four of the new group have
claimed that they had been tor-
tured after arrest may increase
security officials' resentment
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of the government's release of
the prisoners.
The assertion of one pris-
oner that the kidnaping of for-
eign diplomats is a legitimate way
of rescuing comrades who face
long prison terms is likely to
lend substance to the govern-
ment's fears of more incidents.
The dean of the consular corps
in Sao Paulo has requested
special protection for foreign
diplomatic personnel there.
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PANAMA'S TORRIJOS MOVES TO BLUNT OPPOSITION
Touchy about criticism, con-
cerned about persistent coup plot-
ting, and worried about assassina-
tion threats, Panamanian strong-
man General Torrijos has been mak-
ing life difficult lately for
those opposed to his regime.
Torrijos demonstrated his no
nonsense approach to subversion
by having a number of key leftists
arrested to prevent them from pro-
25X1 voking violence during the Central
American and Caribbean Games and
by detaining followers of deposed
president Arias
Also, Tor-
Le has exiled a popular Jesuit
priest whose radiobroadcasts had
been critical of the government
and he is pressing the US to ex-
tradite Hildebrando Nicosia, a
top Arias aide who sought asylum
in the Canal Zone following an un-
successful attempt to organize a
coup.
The Jesuit's cautious and
carefully balanced criticism had
posed little danger to Torrijos.
Indeed, as virtually the only re-
maining critic of the regime, he
gave some credence to the Gen-
eral's assertion that there was
freedom of the press. His expul-
sion on charges of subversion,
therefore, suggests weakness
rather than strength, and in-
creases the distance between the
government and the church.
Torrijos' frustration over
his inability to eradicate plot-
ting has even begun to affect US-
Panamanian relations. Torrijos
told a US military official on
16 March that he had ordered his
subordinates to reduce, and in
certain instances to cease coop-
eration with Canal Zone authori-
ties because he felt that such co-
operation had been a one-way deal
favoring the US. He stated that
he would continue with this atti-
tude until he was sure that some
cooperation was coming his way.
Torrijos has persuaded himself
that the Canal Zone is being used
as a sanctuary for subversives,
and he has demanded that the US
extradite Nicosia. Although Ni-
cosia is accused of embezzlement,
the extradition request is really
motivated by a desire to punish
him for his political activities.
Torrijos' hard-line approach
may succeed in forcing opposition
elements to lie low, but it prob-
ably will not increase his popu-
lar support or restore business
confidence in his re ime.
Nevertheless, no one
has yet appeared on the scene with
sufficient strength to pose a se-
rious threat to Torrijos. F__]
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GOVERNMENT AND PRESS ON COLLISION COURSE IN PERU
Continuing criticism of the
military government by opposition
newspapers is likely to result
in stricter measures by the gov-
ernment to control the press.
So far, however, the government's
attempts to intimidate the press--
the expropriation of two Lima dai-
lies, the closing down of another,
and implications that the nation's
leading daily is involved in an
international plot against the
government--have resulted instead
in more virulent criticism by the
opposition newspapers.
The military government,
which in the past has demonstrated
its sensitivity to criticism of
any kind, has endured a consid-
erable amount of it in recent
months and is likely to seize on
any suitable pretext to silence
its opposition. Such a pretext
for a move against the leading
daily El Comercio may have been
provided by Expreso, the Lima
newspaper that was expropriated
on 3 March and turned over to the
Communist-dominated unions to op-
erate. Expreso charges that El
Comercio is involved in a plot
to overthrow the Velasco govern-
ment. It has persisted in these
charges and has now linked the
US to the plot as well, despite
the court suit being brought
against it by the owners of El
Comercio.
General Fernandez Maldonado,
the minister of mines and energy
and most radical member of the
government, hinted that the gov-
ernment's patience is wearing thin
when he implied in a press confer-
ence that there is substance to
the charges. He is quoted as say-
ing that the military knew that
they "would have to confront very
powerful internal and external
enemies" but that they were pre-
pared "to run every risk to achieve
fully the objectives of the revo-
lution." These words, described
as being uttered in an aggressive
and highly nationalistic tone, are
reminiscent of the rhetoric used
in the early days of the regime
when it felt threatened on all
sides.
La Tribuna, the party organ
for APRA, which has long been the
military's principal political ad-
versary, was closed down last week.
It is still appearing on the news-
stands in abbreviated form, how-
ever. The paper was closed for
failure to pay its debts. La
Tribuna claims, however, that this
is -only a legal ploy the government
is using to silence opposition af-
ter violence and a "fifth column
of Communists" failed to work as
it had at Expreso.
Since the closure, La Tribuna
has taken off its gloves and launched
the strongest attack on the govern-
ment yet heard in Peru. Referring
to a secret military pay raise of
a few months ago, the paper charges
that the "brains of the revolution
elevate the salaries of the 'revo-
lutionaries' while freezing the
salaries of the workers." La
Tribuna adds that it will continue
to denounce the "immoral moralizers
who in a few months have amassed
fortunes of their own while recom-
mending the 'cooperativization' of
the people's wealth." Such attacks
as these can be expected to prompt
a retaliatory move from the mili-
tary. 25X1
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SURINAM HAS NEW LEADER BUT SAME OLD PROBLEMS
The initial optimism that ac-
companied Minister President Jules
Sedney's assumption of power last
November has dimmed. The govern-
ment's financial position, in bad
shape before, has worsened. Ra-
cial tensions have increased and
dissatisfaction with the govern-
ment's performance is on the rise
among many political groups.
Sedney's financial difficul-
ties can be seen in his inability
to meet the government payroll.
Cabinet ministers have become dis-
gruntled because Sedney has con-
tinued them at the half-pay rate
imposed by his predecessor, and
a few may resign.
All three major racial groups
are disappointed with the govern-
ment's performance, and much of
the dissatisfaction stems from
political patronage or the lack
of it. The East Indians believe
that more of their people should
be included in the government be-
cause their party has the largest
bloc of seats in parliament. In-
donesians charge that Sedney's
government has done nothing for
them. The Creoles (Negroes), who
had dominated Surinam politics
until the last election, are sus-
picious of East Indian intentions.
Creole featherbeddingin the
civil service is adding to the
financial crisis caused by tight-
ening of Dutch aid policies. Any
move to reduce government employ-
ment could create a political sit-
uation that might deteriorate into
racial conflict. The increased
spread of East Indian cultural and
religious activities has aroused
resentment among the Creoles, as
has the government's decision to
replace some Christian holidays
with Hindu and Moslem ones.
Sedne
has stated that he will re-
sign if a single demonstration that
has racial overtones occurs. He
will do little to forestall such
an event, however, and thus may
be forced to resign.
Public disappointment with
the administration's record thus
far has led to a growing feeling
that new elections will have to
be called before the present gov-
ernment's four-year term ends.
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DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
Special Report
Private .Enterprise- Alive But Not Well in the USSR
Secret
N2 44
20 March 1970
No. 0362/70A
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PRIVATE ENTERPRISE: ALIVE BUT NOT WELL IN THE USSR
Popular Western conceptions, or misconceptions, of the role of private
economic activity in the Soviet Union probably run the gamut from the
belief that it is insignificant to a suspicion that it plays a dominant part in
providing the populace with food and a broad range of consumer services.
The truth, as usual, lies somewhere between the extreme views. The Soviet
economy is predominantly a socialized economy; yet certain private eco-
nomic activities are permitted. The conduct of these activities invariably is
restricted to an individual or family scale of operation, but the aggregate
impact of private activity is significant.
PRINCIPAL FIELDS OF PRIVATE
ECONOMIC ACTIVITY
Private economic activity in three fields is
sanctioned, under strict controls, by the Soviet
Government. The Soviet citizen is allowed to
grow and market his own agricultural products,
build his own home, and work in some profes-
sional, personal, or repair service field. In addi-
tion, he is known to indulge in various other
economic activities illegally, sometimes with little
interference from the authorities. Some of these
illegal activities-such as prostitution and black
market traffic in foreign currencies and consumer
goods-are impressively evident to foreign visitors,
yet have little impact on the economy at large.
Others-particularly the theft of building ma-
terials and of agricultural products from social-
ized organizations--are less visible but may be of
substantial economic importance. Unfortunately,
the scarcity of data on illegal activities prevents
discussion in precise quantitative terms.
Private agriculture consists of cultivating
garden plots ranging in size up to an acre and a
half, tending small flocks of poultry, and keeping
livestock, usually only one or two head. The size
of the plots and the numbers of livestock and
poultry tended are strictly regulated, as are the
Special Report
assignments of the plots themselves. In rural
areas, plots on the socialized farms are allocated
to households with one or more members em-
ployed either on state or collective farms or in
other socialized enterprises or organizations. Plots
also are assigned to households in urban areas
whose heads have jobs in the socialized sector.
For the most part, urban householders' plots are
found in clusters on the outskirts of cities.
Because of the small size of the private plots
and the market conditions, private agriculture
concentrates on crops and products that require
relatively little land. High value, labor-intensive
products such as potatoes, vegetables, fruit, meat,
milk, and eggs are dominant.
Most of the privately produced goods arc
consumed by their producers, but some are sold
to socialized processing and distribution organiza-
tions and some are sold by their producers on
farmers' markets known as collective farm mar-
kets. Prices in these markets, which are main-
tained by the authorities in all towns and cities,
are largely determined by supply and demand and
usually are higher than the fixed prices of the
state retail stores. Product quality, however, is
higher in the collective farm markets.
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AW
Figure 1. Ha 3TOM yxa6e A AOM noCTpoMn!
("I built a house on that bump!")
("How about a couple of nicely salted cucumbers!")
(FRUIT AND VEGETABLE STORE)
Figure 3. MHe napy ManoconbHbIX oryp i4KOB!
Special Report
Figure 2. CTOJ160BA31 AOPOrA
(" The high road ")
-all cartoons from Krokodrl
20 March 1970
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Construction of dwellings is the most impor-
tant nonagricultural type of private enterprise.
Private construction is concentrated in rural areas
and on the outskirts of smaller towns, where local
authorities allocate parcels of land. As private
building is limited to do-it-yourself arrangements,
privately built houses characteristically are
crudely and simply built and rectangular and sin-
gle story in design. Unskilled labor is normally
used, and many of the materials are cast-offs from
state construction projects. Even cadged materials
sometimes are of first class quality, however. (See
Figures 1 and 2.) Utilities, in rural areas espe-
cially, generally are lacking, except for electricity.
Some new houses, however, are without even
that. Single family residences are limited to 60
square meters (646 square feet) of floor space.
This means that the typical privately built house
measures only about 20 by 32 feet. If several
families join to build a multifamily dwelling,
space per family is not to exceed 60 square
meters. Private construction is financed from per-
sonal savings and state loans.
Work in private services covers a broad and
poorly defined range. It includes (1) professional
services such as medical and dental care and the
teaching of languages and music,(2) repair work
on shoes, electrical appliances, musical instru-
ments and housing, (3) personal services such as
barbering, hairdressing, and sewing,and (4) handi-
craft work such as boot making, gold working,
and embroidery. Also, there is a "gray" area in
which service activities are tolerated but not le-
gally sanctioned. Included in this area is work
done on bicycles, motorcycles, and automobiles,
house painting, furniture moving, and the delivery
of goods.
IMPORTANCE OF PRIVATE ACTIVITY
The share of Soviet gross national product
(GNP) generated by the private sector has been
Special Report -3 -
declining irregularly over time. Since 1950 it has
dropped from about 22 percent to a current level
of approximately 10 percent. The absolute value
of private production, however, increased slightly
over this time span. Moreover, mere allusion to
the proportion of GNP generated by the private
sector underplays the importance of its contribu-
tion. Private activities contribute directly and ap-
preciably to the quality of Soviet consumers' lives
and are not qualitatively duplicated by the social-
ized sector.
About eight percent of GNP and 31 percent
of net agricultural production are accounted for
by private agricultural activity. Because of the
low quality and spotty availability of perishable
foodstuffs in the socialized stores, Soviet con-
sumers rely on produce from their own plots or
buy the major share of their high-quality vege-
tables, meat, dairy products, and other perish-
ables directly from other private producers. Even
the manager of a state fruit and vegetable store
may depend on private vendors to satisfy his
personal wants. (See Figure 3.)
The relatively large share of total crop out-
put accounted for by the private sector (about
one-fourth) is grown on about four percent of the
total area under crops. In the private sector, the
value of output per unit of land is nearly nine
times as great as in the socialized sector. More
than half of this difference in value is accounted
for by the difference in crop composition in the
two sectors. For example, vegetables are more
common in the private sector and grain is more
prevalent in the socialized. The rest of the dif-
ference can be chalked up to the application of
more and better labor to each unit of land in the
private sector. People who tend private plots give
greater attention to weeding, watering, fertilizing,
and killing pests. Partly because they exert such
effort, the plot tenders can and do plant vege-
tables and potatoes more densely than farmers in
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the socialized sector. The diligence of private
growers no doubt is due in large measure to the
knowledge that the produce of their plots is their
own for consumption or for sale.
Private production accounts for nearly 40
percent of all meat production, although the an-
nual census of livestock shows that private owners
have only about a quarter of the animals. The
anomaly seems to be largely accounted for by
reluctance of private producers to keep livestock
through the winter, when maintenance costs are
high. The livestock census is conducted on I
January each year.
Privately owned livestock are not entirely
maintained by feed grown on privately held land.
In addition to the 21 million acres of land di-
rectly under the control of households -which
includes one and a quarter million acres of wild
hayland-privately owned livestock are sustained
by roughly 250 million acres of pasture and 70
million acres of hayland in the socialized sector.
In addition, the household members receive feed
as payment in kind for work in the socialized
sector, and, apparently, they steal a good deal
more from the state and collective farms.
As has been noted, a portion of private farm
production is sold through the collective farm
markets. In 1968, collective farm markets ac-
counted for about five percent of retail sales of all
food, but for larger portions of retail sales of
perishables, such as eggs (20 percent), meat (10
percent), and milk (10 percent). Even larger pro-
portions of fruit and vegetables are sold in the
collective farm markets.
In 1968, private construction of housing
generated only about two percent of GNP and
absorbed only one sixth of investment in housing,
but it accounted for about one third (by floor
area) of the housing completed. Roughly 55 per-
cent of the total amount of housing now is pri-
vately owned, in contrast to 70 percent in 1950.
In urban localities the private share is only about
one third and is falling rapidly. Private construc-
tion is most common in the rural areas, where
socialized construction of housing is least devel-
oped and 80 percent of the dwellings still are
privately owned.
Privately rendered services generate less than
one half of one percent of GNP and comprise less
than five percent of all consumer services. Never-
theless they uniquely fulfill certain specific
needs particularly in small towns and rural
areas-that are not served by socialized service
organizations.
POLICY TOWARD PRIVATE
ECONOMIC ACTIVITY
Official government policy toward private
economic activity over the long run has been
characterized by antagonism and repression. This
approach, which has been common to the Stalin
and post-Stalin governments, is rooted in the
ideological underpinnings of Communism. It is
related to an assumption that all Soviet citizens
sooner or later voluntarily will surrender their
rights to engage in private enterprise when the
superiority of socialized production becomes
manifest.
Despite their continuing hostility toward pri-
vate activity, however, various leaders have dem-
onstrated la good deal of flexibility in the short
run, particularly toward private agricultural pro-
duction. Changes in policy toward private farming
and resulting fluctuations in private farm output
have been rather prominent and appear to be
related closely to success or lack thereof in the
socialized sector. After a period of relatively rapid
growth-or even a single year of exceptional per-
formance by the collective and state farms-there
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is a tendency to tighten the restrictions on private
farming. Limits on the size of private plots and
livestock holdings are made more stringent, taxes
are increased, confiscations occur,' less feed is
made available to householders, and the number
of days that collective farm members are required
to work in the socialized sector is increased.
Then, when socialized farm production falls short
of needs and expectations, restrictions on private
agricultural activity are relaxed.
The 1956-64 period under Khrushchev was a
time of restriction and decline in private agricul-
tural production. When Brezhnev and Kosygin
assumed power in late 1964, socialized agriculture
was floundering, and the new government began
to encourage private farming. By 1967, socialized
agriculture was performing more satisfactorily,
and the attitude of the leaders toward private
farming became ambivalent or indifferent. In the
absence of direct orders to the contrary, local
authorities, responding to continuing pressure
from higher authorities for greater socialized pro-
duction, then put more restrictions on the private
farmers. This restrictiveness, combined with side
effects from certain official policies in the social-
ized sector, brought a decline in individual live-
stock holdings and a standstill in private pro-
duction of crops and meat and dairy products.
Concurrently, socialized output of meat and dairy
products leveled off, and this at a time when
consumer demand for high quality foodstuffs was
increasing rapidly. In late 1969 there were signs
that once again a turning point in official policy
had been reached. The leadership began to urge
local authorities to aid the households in main-
taining or expanding their livestock holdings. Lo-
cal Communist Party organizations were ordered
to check on the response to these exhortations.
Although it is too early to judge, the downward
trend in private livestock holdings may be slow-
ing. Even though the value of private livestock
Special Report
holdings declined five percent during 1969, hog
numbers increased by more than ten percent after
three consecutive years of decline.
The short-run attitude of the leadership to-
ward private construction of dwellings has been
less variable, but periods of expansion and con-
traction of private homebuilding have occurred.
Private building surged during 1957-60 in re-
sponse to official encouragement, only to de-
crease in the early 1960s when new constraints
were imposed. After 1966 there was some further
reduction in private building, but that apparently
was caused by shortages of building materials
rather than by administrative restriction. The
Brezhnev-Kosygin government seems to want to
maintain private building at approximately the
current level. Construction by individual would-
be home owners is not a very promising approach
to the extreme shortage of housing that prevails
in Soviet cities, but it does play a very useful role
in smaller towns and rural areas.
Soviet leaders have found little reason to
vary their generally hostile policies toward the
private provision of services. Complete elimina-
tion of such activity, however, clearly would im-
pose unnecessary hardships on Soviet consumers
and further strain the capacity of the already
inadequate socialized service network. Consumer
demand for privately provided services appears to
be increasing as money incomes rise. Since 1965,
suggestions that the private rendering of services
be allowed to expand have been publicized, but
little increase has been noted in the volume or
scope of private service activity.
Soviet leaders seem to realize that private
economic activity continues to enhance the qual-
ity of life in the USSR in ways that cannot be
-5 - 20 March 1970
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duplicated by socialized organizations. Hence it terprise altogether. Rather, they probably will
seems unlikely that they will indulge their ideol- continue to permit it under varying degrees of
ogically based hostility by outlawing private en- restriction.
Special Report -6- 20 March 1970
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Approved For Release 2008/04/14: CIA-RDP79-00927AO07800010001-7