WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A010600060001-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 23
• Document Creation Date: December 21, 2016
• Document Release Date: November 16, 2007
• Sequence Number: 1
• Publication Date: December 21, 1973
• Content Type: SUMMARY

Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
Iq
State Dept. review completed
Next 1 Page(s) In Document Denied
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
Secret
Weekly Summary
Secret
21 December 1973
No. 0401/73
Copy N2 67
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
ded_ Its transmission or revelation cf its con-
sipt by an unauthorized person is prohib ted by
CONTENTS (21 December 1973)
1
The Middle East
4
Bidding for Oil
5
USSR: Optimism on SALT
6
Soviets Outline 1974 Economic Plan
7
Reaction to US Energy Proposal
8
After the Copenhagen Summit
I
25X6
10
UK: Draconian Measures
EAST ASIA
PACIFIC
12
South Vietnam: Fighting Eases
13
Cambodia: Reluctant Support for Sihanouk
14
China: A Temporary Truce
14
South Korea: Pak's Troubles Persist
15
Thailand: The King Is Back
MIDDLE EAST
AFRICA
16
Turkey: Still Trying
16
Israel: Enough Oil
17
The Yernens: Gestures to Aden
WESTERN
HEMISPHERE
18
Venezuela: Perez Charts His Course
18
Argentina: New Army Chief
19
Uruguay: Renewed Optimism
EEKL V SUMMARY, issued every Friday morning by
Tice of Current Intelligence, reports and analyzes signi?-
opments of the week through noon on Ttur'day.
includes material coordinated with or prenared
Economic Research, the Office al Strategic
the Directorate of Science and Technology.
ished senarately as Special Reports are lis:ec ire the
WARN ING
EKL.Y SUMMARY contains classified information
atonal security of the United States, within
inq of Title 18, sections 793 and 794, cf he US
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
The Middle East
Waiting: The UN Conference Hall in Geneva
AJO kOL LAC W
The Arab-Israeli peace conference is expected to open in Geneva today
notwithstanding Syria's boycott announcement and another hijacking by
unreconciled Palestinians. At the same time, the Arabs and the Israelis
clearly remain skittish and suspicious as a result of continuing-albeit gen-
erally minor-cease-fire violations on both the Syrian and Egyptian fronts
and further military preparations by both sides.
SECRET
Page 1 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
President Asad's decision not to participate
in the Geneva talks reflected his conviction that
Syria had nothing to gain by attending an initial
round of negotiations that apparently will be
given over primarily to discussing the disengage-
ment of Egyptian and Israeli forces. One Syrian
diplomat referred to Syria's attendance as "win-
dow-dressing," useful to Egypt but a waste of
time for Syria. The Syrians probably expected to
be subjected to an immediate increase in the
already substantial pressure to release Israeli
POWs-their only bargaining chip-without any
corresponding hope of making progress on the
issues that really matter to them: an Israeli with-
drawal from the Golan Heights and the rights of
Palestinians.
the front. Israel apparently is taking precaution-
ary steps in reaction to these Syrian moves.
Egyptian Reaction
Syria's announcement that it will not par-
ticipate in the Geneva conference constitutes a
heavy blow to the Egyptian aim of presenting a
united Arab front. It leaves Cairo virtually alone
in the face of opposition to the conference from
many other Arabs. President Sadat had expended
much effort since the cease-fire in trying to en-
sure Syria's attendance; Egyptian Foreign Minis-
ter Fahmi and presidential adviser Marwan both
visited Damascus early this week. The Syrian
decision could also increase pressures on President
Sadat to drop the diplomatic option in favor of
military action because the decision not to attend
may reinforce the pro-war sentiment of those in
the Egyptian military who look askance at nego-
tiations.
Asad's decision almost certainly also re-
flected heavy domestic pressures from Baath
Party and army elements who would prefer a
resumption of hostilities. Asad hopes that taking
a hard line will buy him time to see how well the
preliminary negotiations between the Egyptians
and Israelis progress. If they are satisfactory, Asad
might see his way clear to join the talks later. If
they go badly, the Syrians could well decide to
increase still further their military pressure on
Israel.
Syria has put its civilian popula-
mmili y forces on a wartime footing.
Many of the cease-fire violations on the
Syrian front appear to be initiated by the Syrians,
who are attempting to prevent the Israelis from
improving their forward defensive positions along
At the talks, the absence of Syria will
heighten Cairo's sense of urgency about achieving
tangible progress. The official Egyptian reaction
to Syria's announcement reflected some hope
that Cairo may ultimately be able to change the
Syrians' minds, but also some fear that this can be
accomplished only through evidence of move-
ment at the conference.
Egypt has reacted calmly in public to the
week's other impediments to the convening of the
conference. As might be expected, Cairo news
media blamed the brief postponement on
maneuvering by Israel-supported by the US-but
these charges were leveled with an attitude of
resignation that such delays are inevitable. A
radio commentator advised that Egyptians should
have expected a delay and, in any case, "it will
not be long" before Tel Aviv's and Washington's
true intentions toward a settlement become clear.
Israeli officials have taken the Syrian de-
cision in stride, and may even be somewhat re-
lieved. Tel Aviv's preference has long been to
SECRET
25X1
25X1
Pane ' WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
7Cl.r 1 ~'
engage in bilateral peace negotiations with each of
its Arab neighbors; having to negotiate only with
Jordan and Egypt may be regarded as more in
keeping with that stand. The Israelis consider
Damascus as their most intransigent foe, and may
believe that Syria's absence will enhance pros-
pects for a successful, if necessarily more limited,
conference. Defense Minister Dayan provided
some evidence of this guarded optimism on De-
cember 18 when he observed that Cairo has taken
a more "constructive" approach to peace nego-
tiations.
3euRcKX
George Habbash, head of the Popular Front
for the Liberation of Palestine, this week publicly
opposed any PLO participation in the conference.
Such fedayeen disunity has grown recently as a
result of Iraqi efforts to create a radical opposi-
tion front within the group. It will be increased
further by the obligation of the Syrian-supported
Saiqa organization to follow Damascus' lead in
boycotting the conference.
Fedayeen Hijack Aircraft
The shooting early this week at the Rome
airport terminal by Palestinian guerrillas, who
then hijacked a Lufthansa aircraft, was apparently
timed to disrupt Secretary Kissinger's visit to the
Middle East and perhaps the peace conference as
well. The radical Popular Front for the Liberation
of Palestine has been planning several such opera-
tions. The Rome incident reportedly was a joint
undertaking between the Front and Libya. Arab
governments and leaders of the Palestine Libera-
tion Organization condemned the hijacking,
which resulted in 32 deaths; the PLO, in fact,
offered to try the perpetrators. Radical fedayeen
elements, however, remain eager to disrupt the
conference out of fear that the Palestinians will
be abandoned or-worse still in their view-will be
dealt a truncated country controlled by mod-
erates prepared to cooperate with Israel and
Jordan.
The leaders of the several fedayeen organiza-
tions remain divided on how best to promote
Palestinian interests at this point. PLO chairman
Yasir Arafat advocates unity behind a program
that favors a Palestinian state composed of the
West Bank and Gaza, and PLO participation at
the Geneva conference. He has been unable, how-
ever, to win broad support for this strategy from
the leaders of most of the groups represented in
the organization. Many of them prefer to delay
any announcement of over-all policy until the
Israelis show some signs of willingness to make
meaningful concessions.
The Soviets have welcomed the opening of
the Geneva negotiations and will play an active
role in them. Moscow will be represented by
Foreign Minister Gromyko in the opening round,
and later by Vladimir Vinogradov, the USSR's
ambassador to Egypt. As one of the Geneva co-
chairmen, Moscow views participation as support-
ing its claim to co-equal Great Power status, par-
ticularly in relation to the Middle East. With its
position thus recognized, Moscow appears to be
somewhat more relaxed about Washington's role
in getting the Middle East parties together. Soviet
media, for example, gave a positive cast to Secre-
tary Kissinger's recent trip to the Middle East.
Syria's decision not to go to Geneva un-
doubtedly irked the Soviets since they had been
counseling Damascus to adopt a more flexibile
position. The Soviet ambassador delivered to Pres-
ident Asad on December 19 a personal letter from
party chief Brezhnev which probably advised
Syria to reconsider its decision to abstain.
Moscow undoubtedly expects the negotia-
tions to be protracted and difficult. The Soviets
so far have been giving full public support to the
Arab positions and there has been no indication
that they intend to press the Arabs to compro-
mise their demands. Nevertheless, Moscow prob-
ably hopes that the talks will forestall an early
resumption of fighting, and that if some progress
is forthcoming, Moscow can take credit for help-
SECRET
Page 3 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
J b (A- L I
INTERNATIONAL: BI DDII4G F PR OIL
(Unprecedented prices recent y offered for
Nigerian and Iranian state-owned oil promise to
set off a chain of price increases for world oil
supplies. When the Organization of Petroleum Ex-
porting Countries opens its price meeting on De-
cember 22 in Tehran, officials of the producing
countries will point to these offers to support
their demands for higher payments from oil
companies.
Against stiff company opposit on, OPEC
leaders are insisting that future royalty and tax
payments be based on actual market prices. Be-
cause most crude oil sales are from one company
to another, it is difficult to determine market
prices. The producers will maintain that recent
bidding gives some indication of the market value
of oil, and that these prices should be taken into
account in determining posted prices.
The new round of government crude oil sales
began a month ago when Nigeria, Iran, and Saudi
Arabia placed their 1974 state-owned allotments
on the market. The most publicized current of-
fering was Nigeria's-300,000 barrels a day of
low-sulphur oil for six months. A price of $16.80
a barrel-one third more than the highest price
previously negotiated anywhere-reportedly was
bid by an American company. This bid was
eclipsed by offers of up to $17.40 a barrel for
Iran's 470,000 barrels a day of lower quality
crude on six-month contracts. This offer led
Nigeria to require a new round of bidding. If the
Saudis follow past practice, they probably will set
their own price for 525,000 barrels a day, based
on what Iran receives for similar oil.
In October, the Persian Gulf members of
OPEC began their negotiations with the com-
panies by demanding a 100-percent increase in
the posted price, to $6.02 a barrel. While the
companies were formulating a counteroffer, the
governments unilaterally issued a take-it-or-leave-
it package that raised the posted price to $5.12
and established a rule setting the posted price
price.
US $ PER BARREL
1973
Iraq
Saudi
Arabia
Iran
Jan 1
-
2
13
2
15
.
.
Aar 1
-
2.30
2.32
Jun 1
-
2
70
2
76
.
.
Jul 1
Au
1
3
48
2
88
g
.
.
Se
1
-
p
Oct 1
3.00
2.80
2.85
Oct 16
3.62
3.65
3.64
Nov 1
3
66
.
Dec 1
16.00
- 17.40
(Bids)
SECRET
Abu
Dhabi Libya Algeria Nigeria
2.38 3.28
2.75 3.75 3.80
4.00
3.20 5.50
3.00
3.25 5.85
4.32 -
8.50 6.61 6.84
16.80
(Bid)
Page 4 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
6 Two Soviet military affairs specialists on the
staff of Moscow's USA Institute have weighed in
on the SALT debate with perhaps the most seri-
ous and informative Soviet public contribution to
date. Writing in the December issue of the insti-
tute's journal, M. A. Milshteyn and L. S. Semeyko
review the accomplishments of SALT ONE, ex-
press optimism about prospects for SALT TWO,
and show notable interest in the possibility of
controls on MIRVs and eventual reductions in
strategic arms.?
~Milshteyn and Semeyko do not see further
progress on SALT as easy, but they profess that
the improved US-Soviet political climate is con-
ducive to solving the complicated problems of
strategic arms control. They stress the urgency of
achieving a "more firm nuclear parity" in a step-
by-step process, and imply that negotiating con-
trols on M I RVs is the most immediate issue(
` The attention devoted to the M I RV problem
stems mainly from the authors' belief that un-
restricted development of these weapons, coupled
with improved accuracy and greater payload, con-
stitutes a major threat to deterrent stability. Their
stress on the potentially destabilizing nature of
uncontrolled M I RV development and deploy-
ment, in fact, closely parallels the views of many
Western specialists. Such explicit and favorable
reference to force survivability is rare in Soviet
literature. Milshteyn and Semeyko also imply that
qualitative limitations may be necessary to
achieve greater strategic stability. Quoting US
experts, the authors maintain that preserving the
existing parity in the strategic relationship de-
pends on reaching an agreement that takes into
account such factors as warhead accuracy, war-
head yield, and the number of MIRVs(
5 [The article argues that a follow-on SALT
agreement must include strategic bombers and
forward-based systems. The authors note that
comparing bombers with missiles poses difficult
problems because of the aircrafts' differing flight
times, vulnerabilities, and potential reusability.
The forward basing of American aircraft is only
briefly cited as a "geographic asymmetry"
favoring the US that must be considered in SALT
TWO. This treatment of forward basing is mild,
given the stubbornness of the official Soviet line
at SALT!
IThe article's treatment of strategic arms
reductions is also interesting in that the Soviets
have not given much public play to this concept
since Brezhnev signaled Soviet willingness to
negotiate reductions a year ago. Milshteyn and
Semeyko, however, give considerable attention to
the subject, and at one point avow that the
importance of even partial bilateral steps toward
reducing strat gic arms would be "difficult to
overestimate."
FAs a part of a general Soviet effort to sustain
the momentum of detente and of SALT, the
M i Ishteyn-Semeyko article may signal Soviet
willingness to accept certain US strategic concepts
in the interest of moving the Geneva talks out of
their present impasse. Although the authors
berate the perceived obstructionism of "right-
wing" forces and pro-military influences in the
US, these references can also be read as directed
against elements in Moscow who are resisting
detente and arms restraint.)
L; The past military affiliations of both authors
add weight to their words. Semeyko is a retired
colonel who specialized in strategic analysis while
teaching at the Frunze Military Academy. Mil-
shteyn, a retired lieutenant general, was formerly
with the academy of the Soviet General Staff.
Since his retirement he has reportedly served as a
conduit for General Staff views to the foreign
affairs institutes. Milshteyn's present connections
with the military are unknown and the Soviet
military's endorsement of his views cannot be
assumed, but it is unlikely that his article could
have appeared without high-level political re-
SECRET
Page 5 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
The 1974 guidelines presented to the Su-
preme Soviet session last week indicate that the
Soviet economy will continue essentially on its
present tack. The main features of the plan are:
? substantial growth in GNP and industry;
? continued large allocations oi capital
and material in agriculture;
? concentration on completing construc-
tion projects already begun;
? renewed emphasis on consumer welfare
based on increased supplies from the farm
sector.
Industrial growth this year was boosted by
increased supplies of agricultural products, a
trend that should continue into 197-. Growth
targets for most major industrial products, how-
ever, have been reduced from the original five-
year plan goals. Planning chief Baibakov point-
edly commented that the new plan "ensures a
normal and uninterrupted supply of fuel and elec-
tricity," although he urged thrift in their use.
Crude oil and natural gas, which account for
about three fifths of total energy consumption,
are targeted to grow at the same or higher rates
than in 1973..
Farm output s slated to increase 6.4 percent
over 1.973, a record agricultural year. Despite
another major boost in the scheduled allocation
of machinery, fertilizer, and other supplies, how-
ever, prospects for another substantial gain in
agricultural output are dim unless above-average
weather conditions occur again.
The success in agriculture this year allowed
the leadership to resurrect its commitment to
consumer interests. Mainly because of the poor
Prelimitary
Plan
Five-Year-Plan
1971-72 197;
1974
1971-75
MAJOR AGGREGATES
)V'destern concepts)
GCP 3.0 7.0
5.5
6.0
Industrial Production 5.5 6.0
7.0
8.0
Agricultural Production - 3.5 12.0
6.5
3.5
INVESTMENT
metal Gross Fixed Investment 7.0 3.5
PRIMARY ENERGY
PRODUCTION 4.0 5.5
RESOURCES FOR
AGRICULTURE
D.Piivery of Machinery 10.5 13.0
11.0
11.0
D (livery of Mineral Fertilizer 9.5 8.5
12.0
9.5
CONSUMER WELFARE
(per capita)
Consumption 3.0 4.0
4.0
4.0
H.)usinq Space 2.0 2.0
2.0
2.5
SECRET
t Scu2Cr S)
1972 harvest, consumer goals for
this year were cut drastically. Next
year's plan calls for the consumer
goods industries to once again grow
at a faster rate than industrial ma-
terials and machinery, as called for
in the five-year plan. Both rates,
however, are still below those in the
original five-year plan. The sparse
data available on personal income
indicate that gains in purchasing
power will be restricted to match
the smaller increases planned for
consumer goods output. Promised
crease in the minimum wage, have
been postponed again.
Foreign trade with the "devel-
oped capitalist nations" figures
prominently in the plan for 1974.
Baibakov underscored the impor-
tance of importing advanced types
of machinery and equipment, and
reiterated Moscow's preference for
self-liquidating credits-those repaid
in goods rather than cur-
rency.
Page 6 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET "o,
USSR: TWO COSMONAUTS IJJ ORBIT
7 E;
ISoyuz 13, which carried two cosmonauts
into orbit on December 18, appears to be
operating normally. According to TASS, the
cosmonauts will make earth-resource surveys,
observe ultraviolet emissions from the stars
with specially designed telescopes, and test
navigation equipment and other systems
aboard the spacecraft.
Neither of the cosmonauts has had any
prior experience in space, but both are re-
ported to be functioning well and feeling no
ill effects from the flight. The Soviets also
have an unmanned spacecraft-Cosmos
613-in orbit, but the paths of the two are
significantly different, indicating that no ren-
dezvous is planned.
Since the ill-fated Soyuz 11 mission in
June 1971, the Soviets have conducted two
manned and three unmanned Soyuz missions.
The last manned Soyuz mission occurred last
September when two cosmonauts remained in
orbit for only two days.
(7 Despite widespread praise for Secretary Kis-
singer's proposal in London for new international
cooperation on energy problems, the many ques-
tions it has raised indicates that agreement to
establish the proposed energy action group may
be difficult. The US proposal seeks cooperation
between North America, Europe, and Japan on
programs to conserve energy, develop new
sources, give oil producers an incentive to increase
supplies, and coordinate research on alternatives
to oil. The producing countries could also partici-
pate in the action group
9 The West Europeans have expressed great
interest in the initiative, although they are un-
certain how it would mesh with their own plans
for cooperative arrangements with the Arab pro-
ducers. The timing of the Secretary's speech was
taken by some as an attempt to interfere with
European efforts to deal directly with the Arabsj
Although the EC summit communique omitted
jQ direct reference to the action group proposal, US
officials have been told that the community does
not rule out an international effort and that the
EC Commission will consider the US proposal in
preparing its recommendations for community
energy measures. One Quai official, however,
thinks the US and European approaches are prob-
ably not compatible)
10 [Canada is prepared to participate in the ac-
tion group, seeing possible advantages for devel-
oping its own energy resources as well as oppor-
tunities to sell its nuclear power reactors. Ottawa
will nevertheless be wary of giving outsiders con-
trol over Canadian resources. Japan has taken a
positive, if cautious, approach to the US pro-
posal-the caution urged largely by uncertainty
over how the Arabs will respond-1
ip lEven those welcoming the Secretary's ini-
tiative wish to explore such questions as how
much international rationing or sharing is en-
visaged and the nature of incentives for the pro-
ducing countries. Some observers see a dis-
crepancy between the new proposal and the US'
earlier emphasis on becoming independent in
energy sources. Another question is whether non-
governmental representatives would be included
in the action group and, more important, who
would represent Europe if the group's member-
ship should be limited. Finally, the US will prob-
ably be pressed to define a relationship between
the action group and the Organization for Eco-
nomic Cooperation and Development, which has
long been studying the energy problem and in-
cludes all of the action group's potential con-
sumer members. At a minimum, OECD could
become a forum for addressing consumer-country
interests before the wider grouping negotiates
action programs.
SECRET
Page 7 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
The meeting in Copenhagen of the EC heads
of government on December 14-15 p,oduced a
show of unity and the prospect of more. frequent
summits in the future. Paris, Bonn, and London-
the chief sponsors-were not able to w n unqual-
ified approval for their points of view on such
matters as the Middle East, energy, and regional
aid policies. The subsequent blow-up over re-
gional development policy at the EC Council's
meeting this week dimmed even the limited
achievements of the Copenhagen gathering.
In addition to dealing with complex and
divisive community issues, the task of the leaders
of the Nine was complicated by the presence of
four Arab foreign ministers who appeared in
Copenhagen seeking to influence the EC position
on the Middle East. One effect of the Arabs'
presence, however, was to stiffen resistance to
pressures by the Arab oil producers and to in-
crease the resentment of some EC members of the
Middle East policies of Britain and Fran-.e.
President Pompidou, when calling for a sum-
mit last October, wanted primarily to focus on a
broad discussion of European policy and the
organization of "political Europe," evidently
hoping to enhance the French leadership role. On
the Middle East, Paris hoped to move the Nine
further toward a pro-Arab position. At the
Copenhagen meeting, Pompidou reportedly
pressed for an EC declaration incorporating these
views, but finally had to settle for compromise
language that closely paralleled the EC declara-
tion of November 6. Moreover, such "solidarity"
as was evident in the summit statement on
energy-while falling far short of any commit-
ment to oil sharing-nevertheless represented a
step beyond earlier French positions. Paris ap-
parently did get an acknowledgement that a Euro-
pean uranium enrichment capacity should include
the development of the French diffusion process
in addition to the rival British-Dutch-German
scheme. The French, however, apparently failed
to secure a financial commitment to their project.
Chancellor Brandt was particularly inter-
ested in using the summit to develop a common
energy policy. His efforts are largely reflected in
the energy annex to the communique, which calls
on the community to establish an orderly com-
mon market for energy; to take concerted and
equitable-but not identical-measures to limit
energy consumption; to adopt comprehensive
community programs on alternative sources of
energy; to enter into negotiations with oil-pro-
ducing countries concerning cooperation in the
fields of economic and industrial development;
and to seek to ensure stable energy supplies to the
EC countries at reasonable prices. The Dutch,
SECRET
Page 8 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
JCL.Kt I NNW'
who have been hit hardest by the oil squeeze,
expressed satisfaction with the over-all program
despite its omission of a reference to oil sharing.
Prime Minister Heath felt he had gained a
moral commitment for support on a sizable EC
regional fund to aid economically depressed areas,
and some of the language in the communique
reflects British concessions to the Germans and
Dutch in return. Heath believes that such a fund
is a domestic political necessity, and that it is
important to the Irish and Italians as well. Al-
though the leaders agreed to establish the fund on
January 1, they failed to decide the financing.
This left the question to the EC Council, which
ended in total deadlock. London, in order to
strengthen its hand for further bargaining, has
now refused to endorse the community's small
start toward a common energy policy until the
fund issue is settled. A period of difficult bargain-
ing and considerable acrimony is clearly in pros-
pect.
Further summits were left to the initiative of
the country holding the presidency of the EC
Council. With West Germany in the chair during
the first half of 1974 and France the second half,
meetings in Bonn and Paris seem almost certain in
the coming year.
SECRET
Page 9 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 i
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRE 1
UK: DRACONIAN MEASURES
lCj IIn his current showdown with the miners
and other recalcitrant unions, Prime Minister
Heath has announced measures that will make
both labor and the general public keenly aware of
the cost of union defiance of his counter-inflation
program. Heath's moves, particularly the imposi-
tion of a three-day work week, will preclude meet-
ing the UK's long-standing economic growth
goals. The Prime Minister's handling of the labor
strife, plus budget alterations announced earlier
this week, suggests that the Tories may be con-
sidering an early election, perhaps in the spring)
i5 \Faced with the miners' decision to continue
their overtime ban, together with similar decisions
by power engineers and one of the major rail
unions, Heath cut back the work week of most
industries to conserve dwindling coal stocks at
power stations. Among other measures, he also
asked households to limit the use of elf:ctricity
for heating. The government said the emergency
moves were necessary to prevent large-scale dis-
ruption of power supplies, already being threat-
ened by the Arab oil squeeze. An estimated 70
percent of Britain's electrical power is produced
from coal, and most of the coal is carried by rail.
Chancellor of the Exchequer Barber's budget
~~terations include a reduction of expenditures by
almost $3 billion, strcter controls on installment
buying and credit sales, a surcharge on higher
incomes, and a tax on land transactions to curb
real estate speculation. The "mini-budget," along
with the recently announced cuts in the work
19 week, is intended to bring demand into line with
the sharply reduced level of output that is ex-
pected to result from the energy crisis. Lower
consumer spending will also lessen import
demand and thereby ease the record balance-of-
payments deficit Britain has accumulated this
year)
Britons queue up for domestic heating oil
SECRET
Page 10 WEEKLY SUMMARY 21 Dec 7.3
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SLUKL I
) The outlook for settlement of the various
labor disputes looks bleak, although some talks
are continuing. The power engineers have agreed
to resume negotiations with the Electricity Coun-
cil, and the newly appointed secretary of state for
employment, William Whitelaw, met with mine-
workers' officials on December 20. The miners'
executive group-which will decide whether to
call for a strike vote-is not scheduled to meet
until January 10. Leaders of the Trades Union
Congress, an umbrella organization encompassing
most major unions, are cool toward Chancellor
Barber's new measures and are bitter about
Heath's decision to cut the work week. The Con-
gress, which has not become directly involved in
the current labor disputes, still advocates a return
to free collective bargaining instead of having
wages set according to the guidelines in Heath's
counter-inflation program
1(p The Prime Minister's forceful strategy in this
crisis has given rise to speculation he may call an
election early next year. During the coal strike in
early 1972, fuel and power shortages were spread
around so that the impact on the general public
was minimal. Now, the public is feeling the pinch
and many observers feel that the miners have less
support than they did in 1972. The opposition
Labor Party is having difficulty suggesting alterna-
tives to Heath's measures, and its close identifica-
tion with the trade unions may hurt the party if a
general election is called in the near future. The
Tories may also feel that an early election is
preferable to going to the polls after the economy
has fallen into a decline.
DENMARK: THE NEGATIVE MAJORITY
uU opcff
After two weeks or 1'_UCous negotiations,
Danish political leaders have succeeded in putting
together a shaky parliamentary arrangement for a
new government. Moderate Liberal leader Poul
Hartling, the new prime minister, controls only
his party's 22 deputies in the 179-seat parliament.
He is reported to have a commitment of support
from the Center Democrats and the Christian
People's Party, giving him marginal control over
an additional 21 seats.
Despite its minority status, which reflects
the political fragmentation resulting from the
elections on December 4, the new government
will initially enjoy the tacit consent of three other
parties. On many issues, Hartling expects to have
the cooperation of Social Democrats, Radical
Liberals, and Conservatives, giving him the back-
ing of nearly 70 percent of parliament. The new
prime minister refers to his government as a
"negative majority," i.e., the opposition will not
be able to muster a majority against it.
Hartling's cabinet consists of only 12 min-
isters, rather than the 20 of the previous Social
Democratic government. The reduction reflects a
response to the campaign against "inflated gov-
ernment" waged by rightist Mogens Glistrup,
whose Progress Party won 28 seats in its first
election campaign. Five of the ministers are
Moderate Liberal members of parliament; the
other seven are party stalwarts. Nearly all the new
ministers have served in parliament at one time or
another, and four have cabinet experience.
Hartling, who is 59, served as foreign
minister in the non-socialist coalition that was in
power from 1968 to 1971, and chaired his party's
parliamentary group for the past two years. He is
a strong supporter of both NATO and the EC.
Although Hartling has alienated the leaders
of some of the parties, he has forged at least
tentative ties to others, and will probably be able
to limp along until a deeply divisive issue con-
fronts his government. For the short term, he is
likely to attempt only moderate domestic reforms
aimed at slowing inflation and easing the tax
burden of middle-class workers. Little innovation
is likely in foreign policy, particularly toward
NATO and the EC. Even so, the parliamentary
arithmetic makes Hartling's prospects so dim that
early elections are all but a certainty.
SECRET
Page 11 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRE I
SOUTH VIETNAM: FIGHTING EASES 4
.South Vietnamese forces have recouped with holding the western end of the province,
some of their early December losses in Quang Duc key link in their north-south network.
Province by recapturing the district capital of
Kien Duc and the border outpost at Dak Song
that guards a strategic intersection on the road to
the provincial capital of Gia Nghia. Government
commanders indicate they are content to secure
the Kien Duc area and have no current: plans to
seek out Communist forces that still occupy two
other outposts at Bu Prang and Bu Bong.
Fighting in the province has been light
during the past week. The Communists still have
the equivalent of a division in the area but for the
moment they are inactive and appear satisfied
The South Vietnamese may soon move part
of their division-plus force in Quang Duc to
Kontum and Pleiku provinces. This would relieve
another government division, which may then be
transferred back to the coast. Government com-
manders fear that the Communists may try to
take advantage of the weakened defenses on the
coast to strike targets in the heavily populated
provinces of Binh Dinh and Phu Yen. Should the
government withdraw some of its forces from
Quang Duc Province, the Communists might be
tempted to attack again in this area.
Battle for Quang Duc
Province
J by GVN TUYEN DUC
Br. 344 p BIA NGHIA
By Prang
PHUOC
LONG
Bu TT
Bong
1J/'LAMDONG
p P
Miles
ieca Jtured
SECRET
Page 12 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
Reluctant Support for Sihanouk
23 fThe poor relations between Prince Sihanouk
and the Khmer Communists are due Jor some
improvement-at least on the surface
he Khmer Communists have
been un er pressure from certain "allies" to re-
there is no alternative is co rseu
because China, North Vietnam, the Provisional
Revolutionary Government of South Vietnam,
France, and the Soviet Union all support Siha-
n ou k.1
L-I~ f Evidence of the new "pro-Sihanouk" stance
came this week in a public message to the Prince
from leng Sary, the former top Khmer Commu-
nist official in Peking who is en route to the
"liberated" area of Cambodia. Sary, whose pri-
vate dislike of Sihanouk is well-known, was effu-
sive in his praise of Sihanouk's contributions to
the insurgency.)
~A 1These developments underscore the continu-
ing problem of maintaining a facade of unity for
the Cambodian insurgent movement. Sihanouk is
not likely to be taken in by Sary's kind words and
can be expected to keep making statements irri-
tating to the Khmer Communists. Just last week,
he sent a telegram to Senators Mansfield and
Fulbright claiming that the war in Cambodia
would go on indefinitely because neither side can
win a military victory. He gave Phnom Penh
credit for having "overwhelming material superi-
ority" and again indicated that the insurgents are
suffering from munitions shortages. This type of
defeatism from Sihanouk led to thinly veiled
squabbling between the Prince and his Commu-
nist associates last October.'
The Military Situation
5' Undeterred by Sihanouk's pessimistic com-
menfs, the Khmer Communists have increased
their military activity in the Phnom Penh area.
Cambodian Army units quickly repulsed an in-
surgent move to cut Route 1 a few miles south-
east of the city, but had more difficulty defend-
ing several nearby outposts along the Bassac
River. Some 15 miles north of Phnom Penh, Com-
munist rear-guard units held off government rein-
forcements trying to advance up Route 5-allow-
ing other Communist elements to destroy high-
way bridges and evacuate local villagers:.
Z On the Route 4 front, government
troops early this week registered some gains
southwest of Kompong Speu city, but several
miles of highway are still in Communist hands. At
mid-week, army units easily drove off insurgents
SECRET
Page 13 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
CHINA: A TEMPORARY TRUCE
)-7 The on-again, off-again National People's
Congress, already delayed once this year by con-
flict within the leadership, may be held soon.
High-level party meetings, the necessary fore-
runners to the congress, apparently have been
under way since the beginning of the month, and
_propaganda suggests that decisions have been
made on some of the lesser issues awaiting formal
approval. The congress provides a mantle cf legal-
ity for decisions on governmental affairs already
taken by the Politburo and serves as a useful
publicity channel for the dissemination of these
decisions to lower governmental echelons. This
renewed activity appears to have been made pos-
sible by a truce between China's two squabbling
leaders, Chou En-lai and Chiang Ching, Mao's
wife:j
'11-1 The quarrel surfaced in the context of the
"anti-Confucius" campaign that has been gather-
ing momentum in China since the tenth party
congress in August. The brunt of the campaign
seemed to be directed against Madame Mao and
her leftist supporters but there were some prop-
aganda counterattacks against Chou. Early in
December, the two sides appeared to have called a
truce, possibly after some threats by the moder-
ates. In a show of unity, Madame Mao again
began to appear with Chou at some important
Peking functions
,0 `Within days after Madame Mao relented,
preparatory meetings for the National Deople's
Congress began anew. Three Politburo members
who double as province chiefs failed to greet
foreign delegations passing through their prov-
inces, suggesting that they are in Peking and that
the current meetings include the highest echelons
of the party. Propaganda broadcasts began
[More controversial questions, such as ap-
poin ments to key government posts, are prob-
ably still being deliberated. Nevertheless, the
progress to date could not have been made unless
the top leaders had agreed to patch up some of
their differences. The current truce may be a
temporary expedient to get the National People's
Congress off the ground-Madame Mao has been
forced to retreat in the past only to stir up
trouble again at the next opportunity.
KOREA: PAK'S TROUBLES PERSIST
35 [Over the past two years, South Korea's Presi-
dent Pak Chorig-hui has effectively controlled
domestic opposition by combining authoritarian
pressures with occasional political concessions.
Pak may no longer be able to rely on this ap-
proach, however. Students, intellectuals, and
other dissidents, increasingly cynical about Pak's
intentions, are displaying a new willingness to risk
injury and arrest to secure basic political reforms.
They are openly rejecting the government's cur-
rent conciliatory political gestures, and a serious
confrontation could occur in the months ahead.
-~ 5 )l After failing to end two months of campus
unrest and ferment among intellectual groups
with anti-riot measures, arrests, and the closing of
the universities, the government took some very
limited steps early this month to meet demands
for academic freedom, civil rights, and a restora-
tion of representative institutions. On December
3, Pak shuffled his cabinet and removed his CIA
chief-the principal targetof opposition criticism.]
,
u
ona
y
praising revo
administrative arm of the government at i:he local 31 Prime Minister Kim Chong-pil publicly acknowl-
level, suggesting that the earlier dispute over abol- edged some "irrationalities and inefficiency" in
ishing them had been resolved in their ~avor. A the government and pledged to overcome these
long-standing argument over whether China is still causes of popular distrust`i`At a cabinet meeting
in the stage of "people's democratic ,dictator-, on December 6, Kim called for a number of
ship," as the moderates maintain, or has advanced~1 remedial measures that led to an easing of gov-
to the stage of "socialism," the view of the rad- rnment control on campuses, the release of most
icals, has also been resolved. The party thaoretical~ arrested students, and an end to the most blatant
journal Red Flag indicated this month that the elements of the South Korean CIA's newspaper
moderate view has prevailed. censorship.
SECRET
which are the
committees
l
ti
r
o- , , , n WFFKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927AO10600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
`j~ [Such measures stopped well short of any
basic sharing of Pak's political power, however,
and were seen by his opponents as only minor
;5 concessions hristian groups, in particular, were
vigorous in their criticism, with some of the more
outspoken clergy committing themselves publicly
J- to a complete reversal of the policies of the Pak
government.1rThey were joined by a number of
elder statesmen and prominent cultural leaders.
Their demands have focused on the restoration of
personal freedom, at least to the level of two
,years ago, prior to Pak's "revitalization" program
Meanwhile, students at major universities con-
3I tinue to issue anti-government petitions and to
engage in mass protests despite cold weather and
.)3 the closing of their schools. Even the timid op-
position New Democratic Party has called for a
3y more open political system)
Pak probably regards the domestic political
situation as manageable despite the continuing
dissent and hopes that the changes made over the
past few weeks will eventually quiet his critics. If
pressed further, he may consider additional
gestures-perhaps indicating in some way that he
does not intend to occupy the presidency for life
Another possibility is a major initiative to get the
A North-South talks moving, something that the
3S
3q
critics would applaud. Pak also could try to use
Pyongyang's recent naval activity in the Yellow
Sea to focus domestic attention on the national
security issue; Seoul is already portraying the
threat from the North in vivid terms in its domes-
tic propaganda)
)'S" rPak will not allow open opposition to his
leadership to persist indefinitely, particularly in
the face of what he believes will be serious na-
tional economic difficulties resulting from the
energy crisis1 3overnment officials have made no
secret of the fact that any amendment of the
constitution or other major political reform
would be completely unacceptable to Pak. They
claim that Pak may react with new repressive
measures if pushed too far. Police and security
elements are making plans to deal with a resur-
gence of student dissent in the spring, and the
Prime Minister has made it clear that persistent
demands for sweeping political reforms will not
be tolerated.
Page 15
THAILAND: THE KIf~G IS BAC
37)
Most Thai viewed the Ring's unprecedented
emergence into the political arena during the
turbulent days of last October as a unique event.
But the King is showing that he is quite willing to
play a continuing personal role in guiding Thai-
land toward a more democratic system of govern-
ment. On December 10, he appointed a 2,346-
member group to elect a new national legislative
assembly from its membership.
The new group includes Thai from every
occupation and promises to broaden participation
in the emerging civilian political system. Balloting
for the new legislature took place on December
19. The results are not yet in, but representatives
from the rural population should gain a larger
voice in the new body. The new legislature's first25X1
task will be to ratify the new constitution now
being drafted by a committee appointed by Prime
Minister Sanya.
SECRET
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
TURKEY: STILL TRYING
Another approach to ending the leadership
vacuum began last weekend when caretaker Prime
Minister Naim Talu agreed to try forming a short-
term national government embracing all signifi-
cant parliamentary groups. Talu, who earlier this
year became head of the "above-parties" regime
installed under military pressure in 1971, is essen-
tially a technician with no party base of his own.
If he manages to form the coalition, it would
serve only until new elections, possi oly next
spring or fall
-, '1 \All the parties have not yet formally re-
?ponded to this latest move by President Koru-
turk, but the refusal of the right-wing National
Salvation Party to go along appears to have scut-
tled the possibility of a complete across-the-board
coalition. The National Salvation Party called
such a solution "unconstitutional, despite the
party's own questionable legality as an avowedly
Muslim party in a secular state. The party-which
did surprisingly well in the inconclusive parlia-
mentary elections last October but less well in
more recent local elections-opposes new parlia-
mentary elections. Its leaders probably fear an
early vote might reduce its representation
jThe left-of-center Republican Peoples Party,
o the other hand, may hope that the impetus it
gained by its successes in the two recent elections
would help it make further gains. It won the
largest number of assembly seats in the balloting
in October. The other major political group-the
right-wing Justice Party-also favors new elec-
tions, but wants some time to reorganize after its
setback in October
- n calling on Talu, President Koruturk also
reco mended changes in the proportional repre-
sentation electoral law. Although the I&w has con-
tributed to the proliferation of political parties,
such changes have traditionally been difficult to
bring about in Turkey.
\Whatever government emerges from the cur-
nt stalemate-now in its ninth week--it will not
be a strong one. Continued vacillation by the
civilians will increase uneasiness in the military;
fits leaders so far have taken no public stand on
I the impasse, but privately have expressed confi-
dence in President Koruturk. While no prepara-
tions are apparently being made for intervention
now, there has reportedly been some behind-the-
scenes planning by a group of officers bent on
intervention should the situation deteriorate sig-
nificantly over the next six months.
ISRAEL: ENOUGH OIL
,.s0 So\~rzc ES
On December 10, a British flag tanker under
charter to Israel arrived at the Mediterranean port
of Ashqelon with 160,000 metric tons of Iranian
crude oil, the first such shipment since early Oc-
tober. The ship originally had been scheduled to
go to Elat, but was ordered to proceed to Israel
via the Mediterranean when it was learned that
the ship's insurance would be lifted if it were used
to test the Egyptian blockade of the Red Sea.
There have as yet been no noticeable short-
ages of petroleum supplies in Israel. The country's
two refineries have a combined daily capacity of
over 200,000 barrels of products. Israel's domes-
tic consumption of petroleum has been running
an estimated 15 percent below the normal rate of
130,000 barrels per day because of under-utiliza-
tion of vehicles and reduced industrial activity.
Additional reductions could be effected from re-
strictions on non-essential vehicle use and a cur-
tailment of weekend driving. Electric-power
quotas are to be introduced and rates will be
increased steeply for excess consumption. The
minister of communications has said that the re-
strictions are intended as a show of solidarity
with those countries being boycotted by the
Arabs, although Tel Aviv is probably also anxious
to rebuild stocks to prewar levels. These conserva-
tion measures will further reduce petroleum con-
sumption by 5 percent.
Oil from fields in the Sinai is apparently
being used in place of imported crude. By the end
of October, production from the Sinai fields was
about 50,000 barrels per day and was expected to
be close to the normal 100,000 barrels per day by
the end of the year. Thus, most of Israel's domes-
tic crude requirements can be satisfied from Sinai
production and from the substantial stocks on
SECRET
25X1
25X1
Page 1? WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
JCI~r I
THE YEMENS: GESTURES TO ADEN
~}J- (North Yemen is continuing its efforts to
bring the radical regime in South Yemen out of
its isolation in the Arab world. Sana's conserva-
tive patron, Saudi Arabia, evidently approves of
the attempt and is willing to make some gestures
to help it alongl
0'.2, he Arab summit in Algiers in late Novem-
ber presented another opportunity for North
-~' Yemen's President Iryani and President Ali of
4~South Yemen to discuss ways of resolving their
differences. It was their third meeting in the past
three months; they had gotten together at the
nonaligned conference in September and again in
North Yemen on November 10-11. The latest
conversations brought no dramatic changes, but
both leaders apparently believe that such presi-
dential diplomacy helps prevent miscalculations
that could lead to another round of border
clashes like those of a year agoj
l 2- A more significant development at the Arab
summit was a tentative conciliatory move by King
Faysal, via Iryani, toward the Marxist leader of
Ll 3 South Yemen; heretofore, the Saudis have been
Prior to the Algiers meeting, A en a
4 t4 already begun to tone down its belligerently anti-
Saudi propaganda and had even commented
favorably on the Saudis' use of oil as a political
weapon. Moreover, the South Yemenis are now
emphasizing the tactical advantages of a rap-
prochement with Saudi Arabia in the political
indoctrination given to members of their National
Front Party.]
~_j -,;~ aysal's attitude toward South Yemen will
largely determine the extent and pace of any
detente. At this time, the Saudis' position has
evolved only to the point where they are willing
to consider some use of the carrot as well as the
stick, heretofore their preferred means of dealing
with Aden
1+7, (Furthermore, hard liners in both Yemens are
highly suspicious of any moves toward detente
and can be expected to try to sabotage them. Just
prior to Ali's visit to North Yemen last month,
for example, South Yemeni extremists sent a
90-man terrorist group across the border in an
unsuccessful attempt to forestall the presidential
talks.
SECRET
Page 17 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
oc:url I
VENEZUELA: PEREZ CHARTS HIS COURSE
`Buoyed by a massive election margin of over
half a million votes and majorities in both houses
of congress, President-elect Carlos Andres Perez
has begun outlining the policies that will guide his
Democratic Action administration when it takes
office in March 19741
lf6 rAlthough Perez' views on the petroleum
issue have attracted the most attention, unem-
ployment and inflation appear to be the immed-
iate concerns for his government. Citing agricul-
ture as the neediest sector of the economy, Perez
pledged tax reforms, a better distribution of na-
tional income and strong support to agrarian re-
form. His recurring references to agriculture as
the "true moving force behind the development
of Venezuela" and as the "first heavy industry"
to receive government attention suggest that as
much priority will be devoted to this a:,pect of
President-elect Perez
1-4l VWhile acknowledging petroleum's role in
financing social and economic programs, Perez
has not accepted as a necessary corollary the need
to give priority attention to new arrangements
with the oil companies or to a new energy agree-
ment with the US. His statements on petroleum
thus far do not indicate any sense of urgency in
ne otiating a long-term agreement with Washing-
ton.
~Q `Perez has not referred to his earlier state-
ments that, on assuming the presidency, he would
appoint a non-partisan, national commission in-
cluding former presidents Caldera and Betan-
court, to discuss an energy agreement with US
representatives and the petroleum companies. The
commission may still be under active study, how-
ever, and Perez may even decide to follow the
example of his predecessor by sending a personal
envoy to Washington before his inauguration to
exchange views with US officials. He has already
y{~ indicated that Venezuelan petroleum policy
should be used as a lever to obtain needed raw
} materials for other industries. The fact that many
i a of these raw materials are now in short supply in
the US is not likely to cause the Venezuelans to
moderate their demands, particularly if the coun-
try is faced with the prospect of rising unemploy-
ment as a result of some industr shutdowns in
earl 1974.
3 lmendation to promote four colonels, including
ARGENTINA: NEW ARMY CHIEF
c l he resignation of army commander General
Carcagno gives President Peron an opportunity to
strengthen his support among the military. In
naming General Leandro Anaya, corps com-
mander for the Buenos Aires region, as new army
51chief, Peron may be buying time to initiate a
thorough housecleaning that would give control
of the military to ounger officers more respon-
sive to his direction
5 C FCarcagno resigned his post when the Senate
refused its usual pro forma approval of his recom-
SECRET
Page 18 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
SECRET
General Carcagno
his chief aide. The aide was rejected ostensibly
because of his ties with Peronist youth and his
role in planning recent civic action projects.
Actually, the legislature probably acted at the
behest of Peron, who had lost confidence in
Carcagno because of his rumored presidential
ambitions and his efforts to curry favor with
leftist youth and labor.]
G"1 Recently, Carcagno had attempted to create
a better image for the army by involving it with
Peronist youth groups in a flood relief project. He
had also sought to boost his own popularity by
taking a nationalistic stance at the recent meeting
of inter-American army chiefs in Caracas.
Nevertheless, Carcagno's popularity among fellow
officers-never high-had dipped further in recent
hold of anti-Peronist sentiment.
enabled Peron to oust his opponents in that
service, which had long been considered a strona-
months, and both military and political circles
considered his departure inevitable?
5- 1 \The Senate's refusal to reconsider its deci-
sion reportedly will force the colonels to retire;
Carcagno's aide has already done so. A similar
5 high-level shake-up in the navy earlier this
month-ostensibly over a promotion dispute-
optimism among some US Government observers
4 that the administration is at last preparing to
tackle the nation's persistent economic problems:]
5 3 The functions of the council, proposed by
URUGUAY: RENEWED OPTIMISM
5 [President Bordaberry's appointment this
week of a state council to replace the national
congress he disbanded last June has renewed
the resident last June, were vague, but some of
the economic proposals that came out of govern-
cment-wide planning meetings in August and Sep-
tember had been put aside for its consideration.
Among the first tasks facing the 25-member coun-
cil, therefore, will be approval of a new foreign
investment code, an industrial development law,
and a river boundary treaty with Argentina that
permits Uruguay to explore for oil in the Rio de
la Plata estuary. Other proposals made by the
planning meeting, like trimming the over-inflated
bureaucracy, are bogged down in various study
groups?
SS Dust what power the council has in relation
to the President and his military overseers is not
yet clear. When he first proposed to establish the
new body, Bordaberry said it would have power
to check on the executive's conduct in the area of
civil liberties and respect for law and the constitu-
tion, as well as authority to draft constitutional
reform measures. The council apparently will not
have the power, however, to debate the wisdom
of all government proposals, as the di banded
congress did. 25X1
SECRET
Page 19 WEEKLY SUMMARY 21 Dec 73
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
 .Ambl
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0
Secret
Secret
Approved For Release 2007/11/16: CIA-RDP79-00927A010600060001-0