WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A011100190001-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 25
• Document Creation Date: December 21, 2016
• Document Release Date: December 20, 2007
• Sequence Number: 1
• Publication Date: September 19, 1975
• Content Type: SUMMARY

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Weekly Summary
Secret
Secret
No. 0038/75
September 19, 1975
Copy N2 63
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The WEEKLY SUMMARY, issued every Friday morning by the
Office of Current intelligence, reports and analyzes significant
developments of the week through noon on Thursday. It fre-
quently includes material coordinated with or prepared by the
Office of Economic Research, the. Office of Strategic
Research, the Office of Geographic and Cartographic
Research, and the Directorate of Science and Technology.
Topics requiring more comprehensive treatment and
therefore published separately as Special Reports are listed
in the contents.
CONTENTS (September 19, 1975)
EUROPE
1
Portugal: Talks Drag On 25X1
2
EC: Summer Lull Ends
4
USSR: Focus on China
MIDDLE EAST
AFRICA
6
Lebanon: Fighting Shifts
7
Egypt: Vigorous Defense
8
Ethiopia: First Anniversary
8
India: Awaiting the Verdict
10
Zambia-Zaire: Transport Problems
11
Angola: Reviewing Options
WESTERN
HEMISPHERE
13
Colombia: Presidential Visit
14
Guatemala-Belize: Preparations
15
Argentina: New Political Team
16
Chile: Popular Support Remains
EAST ASIA
PACIFIC
17
SEATO: Signs of Discord
17
China: Steel Problems
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Prime Minister - designate Azevedo discusses new cabinet positions with Portuguese leaders
/-:5
PORTUGAL: TALKS DRAG ON
Attempts by Prime Minister - designate Ad-
miral Azevedo to form a government reflecting
the results of last April's constituent assembly
elections are bogged down over Communist
demands for greater representation. Meanwhile,
anti-Communist officers are strengthening their
position in the ruling Armed Forces Movement,
and their leader, Melo Antunes, has been con-
firmed as Azevedo's choice to be foreign
minister.
The Communists reportedly have been
offered the transportation ministry, but view it as
a "poisoned gift" because fare increases are con-
sidered inevitable. Instead, they are seeking the
ministry of industry and are trying to maintain
their influence in the information and labor
ministries. They also have demanded the same
number of portfolios as the Popular Democratic
Party, which received twice as many votes in the
election last spring.
outlin-
Under the new government program
pluralism would
ed by Azevedo on September 13,
be guaranteed within the central government and
in the state-controlled media, areas in which the
Communists have wielded disproportionate in-
fluence. If Azevedo follows through on this
promise, many Communist and fellow-traveling
local administrators stand to lose their jobs. The
new program further guarantees that the con-
stituent assembly-which is dominated by the
Socialists and Popular Democrats-will be allow-
ed to carry out its assigned task of drawing up a
new constitution.
The program on paper would appear to
satisfy the EC Nine's requirement for the es-
tablishment of a "pluralistic democracy" as a
precondition for credits and other assistance for
Portugal's stagnating economy. Member coun-
tries, however, have been persuaded by France
and Germany to adopt a wait-and-see attitude.
The composition of the new government should
decide the issue, and the new foreign minister
could join his EC colleagues for talks on aid as ear-
ly as October 6-7.
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The pro-European and anti-Communist
military faction led by Melo Antunes continues to
strengthen its grip on the Revolutionary Council.
The 23-member council will now be reduced to
17-19 members, with cuts coming at the expense
of pro-Communist supporters of former prime
minister Vasco Goncalves. The council will com-
prise the president, the prime minister, the armed
forces chief of staff, the chiefs of staff of the
respective services, the chief of the security
forces, six representatives from the army, and
three each from the air force and navy. Pro-Com-
munist influence on the council could be limited
exclusively to the navy contingent.
The Communists have also suffered reverses
in the labor movement, where the Communist--
dominated trade union federation has lost a series
of recent elections. The defeats, coming at the
hands of alliances between the Socialists and
radical leftists, mark a significant repudiation by
union rank and file of Communist domination.
Although further setbacks for the Communists in
individual union elections are anticipated, Com-
munist domination of the national federation's
leadership is expected to continue for another
three years.
As the threat from the Communists appeared
to recede, Portuguese leaders were paying in-
creasing attention to a possible move by the right.
The Revolutionary Council issued a warning last
week to former president Spinola-whose armed
supporters enjoy sanctuary across Portugal's
northern border in Spain-not to return. Press
speculation about Spinola's intentions was fed by
his ten-day sojourn in Paris, where he reportedly
met associates to review the Portuguese political
situation and discuss strategy.
Although Spinola has since returned to
Brazil, reports persist that his supporters may try
to capitalize on the political turmoil and the
prolonged absence of an effective government.
The continued failure in Lisbon to come to grips
with the country's problems could rally support
for a rightist alternative.
EC: SUMMER LULL ENDS
The EC foreign ministers resumed activity last
week after the customary summer lull. Their re-
cent meetings have been characterized by in-
creased willingness to consult and act together on
foreign policy matters and growing interest in the
Mediterranean region.
The UN and the Middle East dominated
political consultations in Venice on September 11
and 12. The ministers were pleased with their
coordination at the UN's Seventh Special Session
as it was the first time the EC Nine had managed
to maintain solidarity throughout a major UN
economic conference. The Nine reviewed the EC
position on various UN issues but declined to dis-
cuss them publicly in order to avoid subjecting
Foreign Minister Thorn of Luxembourg, the in-
coming General Assembly president, to the
charge of being under the control of his EC
partners.
After reviewing the results of the European
security conference, the ministers established an
ad hoc group to monitor Soviet and East European
compliance--despite strong French misgivings.
The group, working with NATO and other
Western states, will prepare for the follow-up
meeting in Belgrade in 1977.
The ministers noted that progress had been
made on the Euro-Arab dialogue, but reached no
agreement on Arab demands to allow the
Palestine Liberation Organization to participate
directly in the talks or to include political topics
on the agenda. Up to now, groups of
"denationalized technical experts" have con-
ducted the dialogue. A decision was postponed
on a French-backed proposal to call a meeting
soon at the ambassadorial level. The "experts" ex-
pect to meet again in early November.
The Nine concluded their discussion on the
Middle East by agreeing to provide emergency
assistance for Egypt. The West Germans com-
mitted themselves, to a grant of $50 million for
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Egypt; the other EC states are expected to an-
nounce their aid offers shortly.
Prospects for a conference of oil producers
and consumers and the situation in Portugal con-
sumed most of the foreign ministers' attention at
the council meeting held in Brussels this week.
The EC accepted France's invitation to attend
a preparatory conference in October and com-
mended the French foreign minister on his role.
The UK, however, continues to demand the right
to seek separate representation at the full con-
ference-tentatively scheduled for December-if
it does not agree completely with the substantive
positions taken by the community.
The council charged its ambassadors in
Brussels with coordinating the EC views on the
situation in Portugal and asked the EC Commis-
Foreign Minister Caglayangil
sion to begin drafting contingency plans for
providing aid. The Netherlands, Denmark, and
the UK wanted the EC to commit itself at once to
giving aid, but the French and Germans blocked
such a move pointing out that the EC's earlier in-
sistence that Portugal must move toward a
"pluralistic democracy" before aid is granted has
had a beneficial effect on developments in
Lisbon.
Once the EC is convinced that Portugal is on
the way to establishing a "pluralistic democracy,"
the council will invite the Portuguese foreign
minister to its next meeting in Luxembourg on
October 6 and 7. The Nine will probably decide
on the amount of aid at that time.
Greece's application for full membership in
the community-which should be submitted by
the end of the year-was another topic of discus-
sion. The EC is now considering a financial aid
package for Greece of $300 to $400 million in
grants and loans over a five-year period.
Highlighting the inevitably increased difficul-
ty in achieving unanimity among EC members
that Greek membership would entail, Irish
Foreign Minister FitzGerald stressed the need to
move toward routine use of the EC's qualified
majority voting system at the earliest opportunity.
Turkish Foreign Minister Caglayangil,
meeting with the ministers on September 16, ex-
pressed his concern over the speed with which
Greece's application for full membership was be-
ing processed. The community assured him that
Turkish interests would be protected and that the
EC would take no action to impede Turkey's
progress toward eventual EC membership.
The ministers also stressed their concern over
the lack of progress in the Cyprus negotiations
and their interest in playing a more active role in
mediating the dispute. They were rebuffed,
however, by Caglayangil, who linked his rejection
of their mediating role to the Nine's unwillingness
to make a direct demarche to the US on ending
the Turkish arms embargo.
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JCI. c 1
USSR: FOCUS ON CHINA
In recent weeks, the Soviet central press has
been paying more attention to China, in part
because of the unsettled internal situation there.
Some of the commentary is targeted at non-com-
munist Asians like the Thais, the Filipinos, and the
Japanese, and some is clearly intended for an in-
ternational communist audience.
Red Star on September 11 carried an article
on the "dictatorship of the proletariat campaign,"
which recounted Mao's success in making the
army serve as executor of his anti-socialist
domestic policies and implicitly called upon the
army to resist assuming that role. The central press
has withheld authoritative comment, however, on
the newest Chinese campaign centering on the
novel "Water Margin."
The Soviets probably do not know exactly
what to make of the latter campaign, particularly
those aspects that relate to the Soviet Union.
Soviet officials have been saying little about it,
beyond reiterating the public line that it is
evidence of instability in China and factional strife
exacerbated by the problem of succession to
Mao.
Mosc ow has not yet taken note of a recent
Chinese article that can be interpreted as a
defense of Lin Piao. This is hardly surprising,
however, as Moscow has generally been careful
to avoid giving the Chinese ammunition for the
charge that Lin was pro-Soviet. In fact, while the
Soviets frequently allude to the existence of
positive (read. pro-Soviet) forces in China, they
almost never get specific.
Moscow is clearly worried that in the wake of
the communist victories in Indochina a number of
Asian countries have concentrated on es-
tablishing or upgrading their ties with Peking.
Pravda on September 10 carried an authoritative
article warning the Japanese of the "severe" con-
sequences of concluding a peace treaty with
China containing an anti-hegemony clause. The
article doubtless was prompted by rumors that
negotiations on the peace treaty are to resume
shortly. Moscow is not sanguine about its
prospects of persuading Japan to delete the an-
ti-hegemony clause from the Sino-Japanese trea-
ty, but is talking tough in order to give the
Japanese pause. Izvestia on September 11 carried
an article that seemed targeted mainly at South
and Southeast Asians.
Moscow has also increased its anti-Chinese
polemics for the edification of the world com-
munist movement. The party theoretical journal
Kommunist in mid-August carried an editorial ar-
ticle on China setting the line on Chinese internal
and external developments for agitprop types and
wayward thinkers like the Romanians and
Yugoslavs. The Romanians and the Yugoslavs, not
surprisingly are ignoring the message. In fact,
Bucharest underscored its ties to Peking by send-
ing party secretary Elie Verdet to China early this
month, and Belgrade may send Premier Bijedic to
China in October. Verdet was the highest ranking
Romanian visitor to Peking since Ceausescu went
there in 1971, and if the Bijedic trip materializes, it
will be the highest level exchange ever between
Peking and Belgrade.
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SECRET
LEBANON: FIGHTING SHIFTS
Clashes between Christians and Muslims
spread from northern Lebanon to Beirut this
week, straining the internal security services and
raising the prospect that the army might have to
be called in to help restore order. Two cease-fires
were negotiated at the end of the week, but ten-
sions remain high and the pacts are threatening to
break down. On September 18, the government
radio announced-for the first time since the
sharp clashes of late June-that no city streets
were safe. All residents were urged to remain in
their homes.
Fighting has been especially intense in the
southeastern part of the city, where a Muslim sub-
urb abuts a Christian area controlled by the
right-wing Phalanges Party. The Phalangists, who
were deeply involved in the fighting last June,
stepped in on September 17 because the
government-from which they are excluded-has
not called in the army. The sizable Phalangist
militia quickly became involved in firefights with
Libyan-backed Lebanese leftists and radical
fedayeen.
Interior Minister Shamun has threatened to
call in the army if the clashes do not end soon, but
he has been opposed by Prime Minister Karami
and Palestine Liberation Organization chairman
Yasir Arafat. Karami and Arafat are apparently still
hoping that joint action by Lebanese internal
security forces and the Palestinians will be suf-
ficient to restore order. The Lebanese cabinet has
been meeting daily to consider whether to use
the army but has put off any final decision.
Despite the reluctance of Lebanese Muslim
and Palestinian leaders to turn to the army, both,
according to press reports, have been consulting
on contingency plans for just such a move. Beirut
newspapers have speculated that an agreement
may be reached under which PLO forces will
work with the army as they have done in northern
Lebanon. Some army units have already been
mobilized.
The cabinet this week announced creation of
a "Committee of National Reconciliation" to
arrange talks among the leaders of the country's
political and religious factions. The members of
the committee are the same politicians who have
been meeting daily in the cabinet, however, so it
is not likely that the new group will come up with
any dramatic initiatives.
Fighting in the Tripoli and Bayt Millit areas of
northern Lebanon died down this week as leftists
gradually implemented the provisions of the
"truce" negotiated on September 16. The
radical-leftist October 24 Movement has released
most of the several dozen Lebanese policemen it
seized last weekend, and Christians and Muslims
in the area are negotiating through intermediaries
to better define the buffer zone that separates the
Muslim city of Tripoli from the nearby Christian
town of Zagharta.
Among the by-products of the current tur-
moil has been an increase in the influence of Yasir
Arafat in Lebanese domestic politics. President
Franjiyah has played little role at all. Franjiyah,
who to Muslims is a symbol of Christian intran-
sigence, has lost the initiative in government
councils to Karami and Shamun, and critics are
calling for his resignation. Fran'i ah's six-year
term expires next year.
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EGYPT: VIGOROUS DEFENSE
President Sadat is continuing to take the
offensive against Arab and Soviet criticism of the
second-stage Egyptian-Israeli disengagement
agreement. His propaganda counterattacks are
winning broad support at home, but the accord
has made him more vulnerable to attempts at sub-
version or assassination by radical Arabs. His
defense of the accord is likely to spur increased
Arab terrorism against Egyptian targets. The siege
of Egypt's embassy in Spain this week is a case in
point.
Angered by continuing Palestinian criticism
of the Sinai accord, Sadat last week terminated
the Palestinian-run Voice of Palestine radio
program that had used the facilities of Cairo
radio. The Egyptians have replaced it with a
broadcast whose content they control
themselves. Although the new program osten-
sibly broadcasts on behalf of the Palestinians, it
has devoted most of its time to praising Egypt and
the disengagement agreement.
The Egyptians had warned leaders of the
Palestine Liberation Organization during the dis-
engagement negotiations that further attacks on
Egypt, on the US, or on the accord itself would
result in a crackdown on Voice of Palestine. The
Egyptian action has brought even more ac-
cusations from the Palestinians. The PLO, voicing
a real fear and perhaps also attempting to hide its
embarrassment, has charged that the silencing of
its program was part of a secret agreement
between Egypt and Israel.
Sadat and the Egyptians have also turned
their wrath against the Soviets and Syria. Sadat
said bluntly in an interview last week that "no
person with dignity" can deal with the Soviets,
and he has repeatedly charged Moscow with in-
stigating the Arab attacks on Egypt.
In his criticism of Syria, Sadat has concen-
trated on the Baath Party rather than on President
Asad and has derided the Syrians for falling for
Soviet propaganda and assuming that the Sinai ac-
cord signifies Egyptian abandonment of the Arab
cause. Following Sadat's lead, the Cairo press has
carried the attack further, charging that Syria is
seeking arms and financial aid by portraying itself
as having been left alone and unprotected. 25X1
nda attacks and counterattacks
are having a sobering effect on some Arabs.
Many Many Arabs are undoubtedly disturbed t,
the spectacle of the principal front-line Arab par-
ties at each other's throat, and mediation efforts
are thus likely. No similar concern or desire to
quiet the dispute is evident, however, among the
less responsible Arabs. The attack on Egypt's em-
bassy in Madrid on September 15 was a deliberate
effort to highlight Palestinian opposition to the
Sinai agreement and to fuel anti-Egyptian senti-
ment.
The fedayeen who seized the embassy, took
the Egyptian ambassador and two aides hostage,
and demanded that Egypt renounce the Sinai
agreement apparently created a special group for
this operation. The four attackers are not known
to have been affiliated with any established
Palestinian organization. Although PLO leader
Yasir Arafat condemned the operation, the attack
on the embassy is an omen of what is probably in
store for Egypt.
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ETHIOPIA: FIRST ANNIVERSARY
The celebrations marking the first anniversary
of the deposition of the late Emperor Haile
Selassie were held last weekend without any ma-
jor announcements being made. It had been long
rumored that the ruling military council would
use the opportunity to shake up the leadership
and structure of government. With security
tightened in Addis Ababa and in the Eritrean
provincial capital of Asmara, the Eritrean rebels
made no attempt to disrupt the ceremonies,
although they did destroy a US Navy com-
munications facility near Asmara in attacks on
September 12 and 13.
General Teferi Benti, nominal head of the
military council, held center-stage during the
ceremonies, delivering two major speeches and
making himself available for a rare news con-
ference. After ticking off the changes already in-
troduced by Ethiopia's socialist
regime-including the dismantling of the coun-
try's feudal order, the nationalization of financial
institutions and some industries, rural and urban
land reform, and setting up the student-run rural
development program-Teferi then looked
ahead. He indicated that in the offing are ad-
ministrative decentralization, the restructuring of
the bureaucracy, new rules on income, and a
widespread program of "political education."
General Teferi's speeches carried no specific
commitments about the establishment of a
political party or the military's intention to
transfer power to civilian hands. This led to some
Jntiregime sentiments being expressed, largely by
students, during the five-hour parade on Satur-
day. Teferi did say, however, that the military
council was establishing-perhaps as a substitute
for a party-a political coordination committee
"to arouse and prepare the masses politically and
lead them in revolutionary democracy."
On the subject of Eritrea, Teferi reiterated
Addis Ababa's "unflinching policy" that the Red
Sea province will remain an integral part of
Ethiopia. His earlier promises of administrative
decentralization were obviously meant as an olive
branch to Eritrean moderates. At the same time,
Teferi took the opportunity to castigate the Arab
governments supporting the separatists. He also
sought to harden the resolve of Ethiopians to hold
on to Eritrea.
The Eritrean rebel attack on the US Navy
facility, about 12 kilometers southwest of Asmara,
resulted in the kidnaping of two US military
technicians and six Ethiopian employees. It is still
not clear which faction of the rebel movement
was responsible for the attack. Rebel spokesmen
in Beirut have threatened the death of the US
prisoners and additional attacks on US facilities
around Asmara unless a list of demands centering
on an end to US support for the Addis Ababa
regime is met. The insurgents who carried out the
raid have not yet been heard from.
Two US civilian technicians attached to the
communications facility and kidnaped last July are
still being held by insurgents, reportedly belong-
ing to the Popular Liberation Forces fac-
J2 . 9
INDIA: AWAITING THE VERDICT
The Indian Supreme Court is expected to
decide soon on the legality of a constitutional
amendment, retroactively exempting a prime
minister's election from judicial review. The
measure was rushed through parliament last
month. The court's approval of the amendment
would negate Prime Minister Indira Gandhi's
conviction last June for campaign violations in
1971-the event that led to her assumption later
that month of extraordinary powers under a
state-of-emergency proclamation.
While many legal experts in India regard a
victory for the Gandhi administration as likely, a
decision the other way remains a possibility. A
ruling by the court voiding the amendment
would, of course, be a defeat for Gandhi, but it
would not be a major blow to her chances for
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political survival. Other legislation designed to
protect the Prime Minister's position, passed by a
compliant parliament since June, would have to
be overturned, and she would also have to lose
her appeal of her conviction before she would be
in serious political trouble. It is most unlikely that
Gandhi would lose on all cases before the courts.
Gandhi's legal battles may encourage her to
propose major changes in the structure of the
government. She has made it clear that she
regards the judiciary as representing a privileged
minority while the legislature represents "the
people." The, Congress Party's large parliamentary
majority would give her a means to alter India's
governmental structure, either by amending the
present constitution or by adopting a new one.
In the meantime, if Gandhi wins a favorable
Supreme Court ruling on the controversial
amendment, she may further relax some controls
imposed earlier on the press and her political op-
ponents. The publicized release last week of a
prominent Indian journalist together with
government claims that numerous persons im-
prisoned since June have already been freed
reflect New Delhi's sensitivity to charges of
repression, particularly from abroad. The
government's moves may also have been made in
anticipation of the ruling by a lower court on
September 15 that requires the government to
provide specific charges when arresting critics.
The ruling, made on behalf of the already releas-
ed journalist, could lead to thousands of similar
demands for release from persons jailed under
the emergency regulations.
At present, very few Indians are openly
critical of the emergency. Some are uneasy, par-
ticularly in the national capital where income tax
authorities are assessing possessions of senior
government officials and businessmen, and
numerous civil servants are being fired for poor
performance. Elsewhere, however, satisfaction
with the results of the new regulations is the
prevailing reaction. The bureaucracy appears
more responsive and efficient, college campuses
are quiet, prices have stabilized, and organized
labor is generally more peaceful and productive.
Many intellectuals resent the emergency, but few
are willing to court arrest by publicly denouncing
it. Gandhi may seek to capitalize on the situation
and call parliamentary elections in the next few
months.
Gandhi's 20-point program for
socio-economic reform, announced in July, is
viewed skeptically by most, but at least for the
moment it offers some hope to the poor. Im-
proving short-term economic prospects-largely
because of ample rainfall and the likelihood of a
near record fall harvest-should lessen pressure
on the Prime Minister to implement her reform
proposals. The important middle-class farm lobby
already appears confident that its interests will not
be jeopardized by Gandhi's proposals for land
reform and debt relief.
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ZAMBIA-ZAIRE: TRANSPORT PROBLEMS
Zaire and Zambia have been forced to ex-
pand traffic on alternate routes for their foreign
trade because of the closing last month of the
Angolan port of Lobito. These routes have not
proved able to provide the needed speed in ship-
ment, however, and the two countries will con-
tinue to face difficulties even should Lobito again
become fully operational.
Recent fighting near the port and along the
Benguela railroad, which connects the port with
the Zaire-Zambia copperbelt, brought Lobito's
operations to a halt in mid-August. At the time,
ships were already waiting as much as six months
for berths, and even if current efforts to reopen
the route are successful, delays of four or more
months are likely.
Lobito handled about 40 percent of Zaire's
and Zambia's overall trade--including more than
one third of each country's copper exports.
Copper exports account for about 95 percent of
Zambian and 65 percent of Zairian export earn-
ings. The closure has also affected imports to
these countries, curtailing Zambia's by 25 percent
and Zaire's by 15 percent. Zaire's imports would
have declined even without the port closure,
however, because of foreign exchange shortages.
Lobito reportedly was reopened this week.
Some ships are discharging cargoes, and
shipments of copper already at the port are likely
to resume in the next few weeks. The Benguela
railroad, however, is still closed, although it has
apparently escaped serious damage. The Popular
Movement for the Liberation of Angola is in-
vestigating ways to restore its operation. Zambia
probably will not immediately dispatch copper
along the rail line when it opens because of
Lobito's congestion and the risk of renewed
fighting.
Zambia and Zaire do not have an acceptable
alternative for moving traffic diverted from
ANGOLA _
_
Lo6rto `~a l~
n9U"0
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Lobito. Zairian plans for moving its diverted traffic
are unknown. Copper exports from Zambia via
the new Tan Zam railroad were scheduled to
begin arriving at Dar es Salaam on September 14.
Zambia would have to send 50,000 to 60,000 tons
this month by rail and road to the Tanzanian port
to maintain its previous level of shipments. This
plan is unlikely to be fulfilled, however, because
of port congestion-nearly 64,000 tons of cargo
are backlogged at Dar es Salaam and current
delays of two weeks are likely to increase.
The port of Tanga in northern Tanzania is also
being used as an alternative to Angolan ports, but
it will become congested soon. Tanga and Dar es
Salaam will handle the bulk of imports destined
for Zambia as well as some of the copper exports.
Zambia's other road outlets to east African
ports will be able to handle little of the diverted
exports. Road routes through Malawi and
Mozambique to the ports of Beira and Nacala
could add about 20,000 tons a month. Actual ton-
nage carried will be less because of a shortage of
trucks.
The expanded use of Lourenco Marques in
Mozambique for diverted trade depends on a
political settlement with Rhodesia, through which
rail and road routes extend. For the future,
Malawi has offered to build a new railway from its
existing network to the Zambian rail system at
Chipata. Zaire is also considering plans to im-
prove its own railway links as well as its port at
Matadi. Zambian and Zairian economic problems,
however, will dela completion of these projects
for some ears.
tJ /~
ANGOLA: REVIEWING OPTIONS
An uncharacteristic lull settled over troubled
Angola during the past week. Although the Por-
tuguese, the rival liberation groups, and
neighboring African heads of state involved in the
problem are feeling the pressure of the ap-
proaching deadline for independence,
November 11, they all appear to be assessing the
situation and reviewing options for advancing
their interests in the final weeks before Por-
tuguese rule ends.
Lisbon is more anxious than ever to transfer
sovereignty over the territory, but remains con-
cerned that the government that assumes power
on independence be accepted as broadly
representative. With the formation of a new tran-
sitional coalition including all three nationalist
groups virtually ruled out because of the un-
yielding rivalry between the National Front for
the Liberation of Angola and the Popular Move-
ment for the Liberation of Angola, Portuguese of-
ficials in Angola now appear ready to accept a
two-party coalition composed of the Popular
Movement and the National Union for the Total
Independence of Angola. Between them, the two
groups can claim to represent some 80 percent of
the population. Most Portuguese have serious
doubts that the National Front, now isolated in
northern Angola, can ever function as a viable
national political organization.
Portuguese attempts to promote a deal
between the Popular Movement and the National
Union have so far made little headway because
of National Union leader Jonas Savimbi's
distrust of both the Popular Movement and the
Portuguese. Savimbi can no longer count on his
military alliance with the fading National Front
to give him bargaining leverage, however, and
may ultimately be forced to accept a coalition
with the Popular Movement. In that event, he
will seek guarantees that the Popular Movement
will not move against his group militarily
following independence.
The Popular Movement, for its part, is also
not interested in such a coalition at this time.
Although it does not control all of Angola, the
Movement is the dominant military and political
organization in the territory by virtue of its
military successes in the past few months, and
its leaders apparently have concluded that
Portugal will have no choice but to turn the
territory over to them. If Lisbon balks at such
a choice, the Popular Movement will then have
to choose between coalition with the National
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Agostinho Neto of the Popular Movement (l), Holden Roberto
of the National Front (c), and Jonas Savimbi of the National Union
Union or a seizure of political power in its own
name.
Lisbon has recently sent out signals that it
might decide to turn the Angola problem over to
the UN, although this may be simply a ploy to
pressure the nationalist groups to negotiate their
differences. African states probably would strong-
ly resist a UN role in Angola.
Early this past week, Portuguese President
Costa Gomes requested General Amin, the
current chairman of the Organization of African
Unity, to step up the organization's efforts to send
a reconciliation council to Angola to work out a
peaceful solution with the nationalist groups.
Such a council was called for at the OAU summit
in Uganda last July, but was rejected by the libera-
tion groups at the time.
Leaders of neighboring African states, who
have a direct interest in bringing about a peaceful
transition to independence, are divided among
themselves on how to proceed. The presidents of
Zambia, Tanzania, Mozambique, Botswana, and
the prime minister of Congo met on the problem
in Lusaka, Zambia, last weekend. The meeting,
which was boycotted by the Angolan nationalists,
ended inconclusively, largely because Tanzania's
Nyerere and Mozambique's Machel pushed-un-
successfully-for recognition of the Popular
Movement. In an effort to show that they had
agreed on something, the participants announced
they would send investigating commissions to
Portugal, Zaire, and Angola.
With the exception of some skirmishing in
the north between the National Front and the
Popular Movement, no major military actions
have taken place since the Popular Movement
forced the National Front out of its stronghold at
Caxito two weeks ago. The National Front has dug
in at Ambriz, a major base on the northern
Angolan coast.
Portuguese officials in Angola are giving most
of their attention to the evacuation of whites.
They hope to complete the evacuation of some
50,000 whites from Nova Lisboa by early next
month. In addition, there are about 150,000
whites awaiting evacuation in Luanda and
southern Angola. Lisbon plans to augment its air-
lift with sealift operations from southern and cen-
tral A ngolan ports as soon as
possible.
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COLOMBIA: PRESIDENTIAL VISIT
President Lopez' state visit to Washington
next week comes at a less than auspicious mo-
ment for him. Colombia is plagued by a serious
economic slump, a rash of guerrilla kidnapings
and murders, and an acute urban crime wave-all
of which have prompted the President to declare
a nationwide state of siege. He also weathered the
first serious political storm of his 13 months in of-
fice last week when the opposition members of
his coalition government attempted briefly to
leave the administration. In the area of bilateral
relations, there are currently several signs of fric-
tion between Colombia and the US. Lopez will try
to put these poor reflections in the shadow with a
show of advising President Ford on US relations
with other countries in the Americas. This would
further Lopez' efforts to cast himself as a leader in
the Latin American community.
Lopez has been beset with problems almost
from the moment of his inauguration in August
1974. The popular support evident in his large
election victory began to slip away when his im-
position of emergency economic controls put
lower income sectors in a financial squeeze. In
large part reacting to such hardships, the military
high command at that time began pressing the
President to find a quick and equitable cure for
the country's economic ills. Although the officers
recognized that most of Lopez' problems were in-
herited from the previous administration, they
nevertheless demanded stop-gap measures, even
at the expense of more economically sound
long-term policies. This stand by the armed forces
leaders was matched by their reluctance to help
police control cost-of-living demonstrations by
students and the poor, unless such control was
legalized by a state of siege declaration.
Eventually, in June, Lopez was obliged to
issue the declaration, but not until he had reliev-
ed several of the most prominent dissenting of-
ficers-including the army commander-of their
commands. Since then, opposition to his policies
within the military has diminished, but the
economic problems have not. On the contrary,
spawned at least in part by those problems, a
wave of crimes against property has swept Colom-
bian cities, and long-simmering guerrilla activity
has erupted in many rural areas. Last week, Major
General Ramon Rincon Quinones, the extremely
popular inspector general of the army, was
assassinated in Bogota by pro-Havana guerrillas
against whom he had directed operations prior to
his staff assignment.
Lopez' position may have slipped another
notch as a result. The Rincon killing has rekindled
the military's interest in playing a policy-making
role, abetted perhaps by the government's con-
tinued inability to ease the problems of inflation
and crime. In addition, sensing Lopez' gradually
weakening position, the opposition Conservative
Party has thrown down the gauntlet in prepara-
tion for next year's midterm election. Just days
after Rincon's death, outspoken Conservative
critic Bertha Ospina launched a tirade against the
alleged corruption of Lopez and his closest ad-
visers, paving the way for the Conservatives' 6
C
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cabinet ministers and 11 governors to submit their
resignations in a short-lived demonstration of
politics as usual.
Understandably, Lopez is no longer the pic-
ture of self-possessed moderation that was his
calling card when campaigning. Stung by a New
York Times editorial characterizing Colombia as a
major source of illicit drugs in the US, Lopez
charged last week that the US government is un-
able to "keep US criminals from turning our
country into a site for their operations." Such
resentment as this is likely to be evident, although
more restrained, in Lopez' conversations with US
officials next week. It may also color possible talks
on other matters reflecting bilateral friction:
separate proposals to nationalize foreign banks
and pharmaceutical companies and Colombia's
speedily developing diplomatic and commercial
relations with Cuba.
Lopez will come to Washington convinced of
his importance to the US as president of one of
Latin America's few authentic democracies.
Despite his pluralistic policy of maintaining
relations with countries of all ideologies, he is a
firm friend of the US. He is also inclined to be an
advocate for the US in the leadership role to
which he aspires in those regional forums from
which many countries in the hemisphere would
prefer to see the US withdraw.
`'.
GUATEMALA-BELIZE PREPARATIONS
Guatemala is bolstering its assertions of
sovereignty over Belize with increased military ac-
tivity that could foreshadow an invasion later this
year.
Guatemalan officials have told US embassy
officers that the navy will regularly patrol off
Belize to demonstrate a presence in the area
In addition, the government has asked other
Central American countries to provide troops for
Guatemala in the event of a conflict; responses
have been noncommittal.
President Laugerud is still said to be con-
ditioning any military action on a declaration of
independence by Belize or a UN resolution un-
favorable to the Guatemala position. Because of
the well-founded fear of Guatemalan interven-
tion, Belize is not likely to declare independence
in the absence of a defense guarantee from Bri-
tain. The British, who are gradually disengaging
from the Caribbean area, do not want the
albatross of such a guarantee, but they cannot
walk away from a defenseless former colony fac-
ing an aggressive Guatemala.
Belize appears inclined to make a major push
for support at the UN, feeling that the
Guatemalans are on the defensive after the non-
aligned conference in Lima rejected their position
last month. A Belizean cabinet minister is
currently canvassing UN delegations in New York
for potential backing on a resolution supporting
Belize's independence. The British have decided
not to discourage Belize from raising the issue at
the UN but say they will work to keep any such
resolution moderate in tone.
Although the Guatemalans appreciate the
political and logistic problems inherent in an in-
vasion, Laugerud is clearly suspicious of Belizean
and British intentions. The arguments of his more
hawkish generals are reportedly becoming more
and more persuasive. Their consensus seems to
be that any UN resolution will go against
Guatemala; as a consequence, they may now feel
that further negotiations will not get them the
territorial concessions they want.
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ARGENTINA: NEW POLITICAL TEAM
President Maria Estela Peron's departure for a
month's leave of absence may be designed to ac-
custom Argentines to the prospect of a new
government or at least test their reactions. Before
she left for an air force resort in northern Argen-
tina, military leaders persuaded Peron to grant ac-
ting president Italo Luder "full discretion and ex-
ercise" of presidential power.
Luder wasted no time in using his newly con-
ferred authority. On September 15, he apparently
forced the resignation of Interior Minister and
retired Colonel Vicente Damasco, whose ap-
pointment last month sparked a major controver-
sy that brought the armed forces into an in-
creasingly prominent political role. At the same
time, Defense Minister Garrido also resigned
from his post.
Foreign Minister Angel Robledo, who is
highly regarded by the military high command,
took over the powerful interior portfolio from
Damasco. Robledo will also act as foreign minister
until a successor is selected. The new defense
minister, Tomas Vottero, is a long- time Peronist
and former business associate of acting president
Luder.
Military leaders believe President Peron's
absence will give Luder and his new team a
chance to demonstrate that the transfer of ex-
ecutive power need not be unruly. At the same
time the officers probably expect that the issue of
whether to allow the President to finish out her
term, which runs until 1977, will fade during her
leave and thus help prolong the relative lull in
political ferment that has characterized the past
Acting President Luder (I) with President Peron
PI
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President Pinochet addresses the nation;
General Leigh looks on
CHILE: POPULAR SUPPORT REMAINS
The size and enthusiasm of the crowd in-San
-
tiago-estimates range as high as 300,000 per-
sons-that celebrated the military government's
second anniversary last week are likely to rein-
force President Pinochet's conviction that the
junta has chosen the proper path for the country.
Although the lower classes were un-
derrepresented at the ceremonies, according to
US embassy observers, the crowds appeared
genuinely exuberant and the mood was largely
nonpolitical.
In his prepared remarks during the celebra-
tion, Pinochet gave no indication that the regime
intends to change its policies of economic austeri-
ty and tight control over civilian political activity.
At the same time, in response to continued
foreign and domestic criticism of Chile's human
rights posture, the President did announce a
number of programs that are likely to be viewed
by the average Chilean as a loosening of
restraints. Pinochet announced that a "council of
SECRET
state" composed of former presidents and other
prominent citizens will be formed to advise the
junta on important policy matters; a number of
high-level political detainees will be released
from custody and be allowed to remain in the
country; the state of siege, in effect since the
September 1973 coup, will be "reduced" by "one
level"; and new constitutional "standards" will be
adopted by mid-1976.
Although these programs may to some extent
mute domestic criticism of the regime's hard-line
policies, they are unlikely to affect foreign
criticism noticeably. The President's initiatives are
vague and contain important caveats likely to
limit their effectiveness. For example, although
the lowered state of siege means that a number of
criminal offenses now come under joint military-
civilian jurisdiction, the most serious
crimes-including terrorism-apparently remain
exclusively military matters. Also, according to the
US embassy's reading of the conditions of release
for political detainees, those released continue to
be answerable for any civil ch
arges or sentences
outstanding against them.
Pinochet's new programs nevertheless
suggest an added degree of flexibility in the
military's overall scheme for restructuring the
nation's political system. Recent strong criticism
ofu thstaev o President by fellow junta member General
Leigh may be causing Pinochet to ex-
Gamine more closely the regime's economic
policies and the particularly severe economic
plight of the lower classes. Leigh believes that
Pinochet is moving too slowly in correcting these
economic imbalances, and he will probably con-
tinue to press for further policy changes.
Former president Eduardo Frei has reacted
cautiously to Pinochet's call for civilian participa-
tion in a council of state. Spokesmen for Frei's
Christian Democratic Party have stated that
further clarification is needed before the former
president would agree to join such an organiza-
tion. It is unlikely that Frei will respond quickly to
Pinochet's overture
and
,
at any rate he would de-
mand a clear public statement of the council's
role before lending his rt s support and
prestiee to th,, p a
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SEATO: SIGNS OF DISCORD
/ s - /6 7
CHINA: STEEL PROBLEMS
A Philippine bid to abolish not only the
Southeast Asia Treaty Organization (SEATO) but
also to abrogate the underlying Manila Pact of
1954 could become a contentious issue at the
organization's annual council meeting. The ses-
sion is scheduled for New York on September 24.
The foreign ministers of the member states-the
US, the UK, Australia, New Zealand, Thailand, and
the Philippines-normally attend.
During meetings of the preparatory working
group, the Philippines proposed termination of
the Manila Pact when SEATO is phased out as a
formal organization in two years. Thailand wishes
to retain the Manila Pact because, unlike the
Philippines, it has no bilateral security treaty with
the US. Prime Minister Khukrit discussed this
issue with Philippine President Marcos in Manila
in July and came away believing he had Philippine
agreement to continuation of the pact.
Philippine Foreign Secretary Romulo appears
to be behind the change in the Philippine posi-
tion as part of the Philippine effort to improve
Manila's relations with communist countries.
Romulo argues that the pact is outdated and a
gratuitous provocation to the communists. In for-
mulating his proposal, Romulo probably was en-
couraged by comments by Australian Foreign
Minister Willesee who, like Romulo, is playing to
international audiences by advocating an early
end to both SEATO and the Manila Pact.
The US backs Thailand's interest in extending
the pact, and the UK will go along even though
SEATO is not one of its major concerns. New
Zealand sees SEATO as outdated but accepts Thai
interest in maintaining it. Even the Australian
Labor government, despite its dim view of SEATO
and the negative attitude of its foreign minister,
will probably accept continuation of the pact.
The Thai will take the lead in trying to get the
Philippines to moderate its stand before the New
York meeting. The Filipinos may be tenacious,
The dismal performance of China's steel in-
dustry last year is continuing. While industrial
production as a whole showed a marked gain dur-
ing the first half of this year, the steel industry has
been singled out by Peking as a major problem
area. Production this year is unlikely to improve
much over the 1974 level of 23.8 million tons, 7
percent below the level achieved in 1973. Even
with corrective measures now in force to boost
output, shortages of coking coal and high-grade
iron ore as well as steel finishing equipment will
hamper the growth rate of the industry for the
remainder of the decade.
At least three of China's major steel plants,
An-shan, Wu-han, and Pao-tou, have experienc-
ed production difficulties this year. These plants,
with a combined capacity of about 10 million
tons, account for roughly one third of China's
total steel-making capacity. Smaller plants such as
Nan-chang reportedly have also recorded
production shortfalls.
Factors which contributed to the decline in
steel production in the second half of 1974 con-
tinued into 1975. Dissatisfaction over wages and
factional fighting have led to a high rate of
absenteeism among steel workers. Managers
reportedly have also stayed away from the mills,
further complicating the industry's problems.
Labor difficulties also contributed to the coal
shortage. More important, however, is China's
lack of modern equipment to exploit its huge coal
reserves. Peking has imported capital equipment
over the last several years, indicating a shift from
labor intensive methods. Nevertheless, maximum
utilization of coal reserves will not be achieved
for many years.
At midyear Peking began to take steps to cor-
rect some of the most critical problems in the in-
dustry. Two recent central directives have strong-
ly condemned the disruptions of production
caused by labor unrest and factionalism. A July
Red Flag article specifically dealt with factionalism
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in the iron and steel industry, and numerous press
reports have stressed the need for increased ef-
fort in the industry. Troops have been sent to the
provinces of Chekiang, Kiangsu, and Inner
Mongolia to help improve steel or coal produc-
tion.
China's total steel supply has also suffered
because of a decline in imports from Japan.
Delayed steel trade negotiations, mainly because
of Chinese demands for lower prices, contributed
to the decline. In the first six months of 1975, im-
ports amounted to only 900,000 tons, a drop of
more than one third compared with the same
period last year. Japan provides 80 percent of
China's steel imports.
In June, China re-entered the market for US
steel scrap as a means of increasing production.
More than 420,000 tons of US scrap were im-
ported by China in 1973. This amount dropped to
190,000 tons after the US imposed export controls 25X1
in 1974. The controls were lifted at the beginning
of this year, and Peking imported near) 100,000
tons of steel scrap in June and July.
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/Z1 - - //, 5
THE 30th UN GENERAL ASSEMBLY
On September 16, the 30th UN General
Assembly opened in an atmosphere markedly
different from that at most recent sessions. The
successful conclusion of the Special Session on
economic issues, which adjourned Tuesday morn-
ing, showed that cooperation and compromise
promise benefits to both developed and develop-
ing states and that the major powers are still com-
mitted to making the UN work.
The Special Session successfully avoided con-
frontation even though serious differences re-
main on such issues as the status of economic
declarations issued by the developing states and
aid targets. The moderate faction within the
group of developing countries finally succeeded
in overturning what has until now been the
radicals' virtually unchallenged domination of the
group.
Other factors pointing to a less antagonistic
session are the replacement as assembly president
of Algerian Foreign Minister Bouteflika by Lux-
embourg Prime Minister Thorn and the new Sinai
disengagement agreement.
Political Issues
The old East-West political alignment will still
determine the outcome of many votes. The vote
on UN involvement in Korea will follow the old
East-West lines, and it will probably be close.
South Korea's backers have proposed the dis-
solution on January 1, 1976 of the UN Com-
mand-the body responsible for preserving
peace and security in the Korean Peninsula-con-
ditional only upon agreement by the North
Koreans and their supporters to maintain the ar-
mistice agreement. North Korea's supporters
have proposed the withdrawal of all foreign
forces from Korea and the conclusion of a peace
treaty between the US and North Korea, ex-
cluding Seoul as a treaty party.
Cyprus and the Middle East are other major
political topics likely to be raised at this session.
To a large extent, however, both issues depend
on negotiations and events outside the assembly.
The assembly would be faced with a very
ticklish issue if Turkish Cypriot leader Denktash
continues to insist on equal time before the
assembly with Archbishop Makarios, who is
scheduled to speak next week.
The issue of financing the UN peace-keeping
force in the Middle East may come up, with
potentially unsettling consequences. The
developing countries want the developed coun-
tries to pay more of the force's costs.
Moscow faces a special problem concerning
the UN relationship with the latest Sinai accord.
The Soviets want to minimize UN endorsement of
the accord and in particular want to avoid any ac-
tion that implies an endorsement on their part of
the US presence in the Sinai. The Soviets are not
saying what they will do if, as seems likely, the
Security Council is called upon to authorize an
expansion of UNEF to police the new Sinai agree-
ment. The indications are, however, that they will
abstain on this question rather than veto it, an ac-
tion that would put them on the side of renewed
tension in the Middle East.
Soviet Disarmament Proposals
Moscow has chosen detente and disarma-
ment as the themes it will stress at the 30th ses-
sion. The centerpiece of its campaign this year is a
loosely drafted treaty proposing a "complete and
general" prohibition of nuclear weapons tests.
The Soviets have portrayed the test ban as
part of their post-CSCE effort to cap "political
detente" with "military detente. They are also
dusting off their earlier proposals for banning
manipulation of the environment, calling for a
world disarmament conference, and reducing the
military budgets of the great powers. The Soviets'
purpose is clearly propagandistic and an-
ti-Chinese. It undoubtedly is no surprise to
Moscow that the response to its proposals has so
far ranged from indifference to hostility.
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The assembly will be called upon to review
the activities of two meetings on disarmament
and non-proliferation in the past year: The
Non-Proliferation Treaty Review Conference in
May and the annual session of the Conference of
the Committee on Disarmament.
fhe extent of UN involvement in colonial
issues has been drastically reduced because of
events in recent years:
? Portugal has granted or is in the
process of granting independence to its
former colonies.
? Papua New Guinea received its in-
dependence Tuesday, leaving the Trust
Territory of the Pacific Islands-ad-
ministered by the US-the only active UN
trusteeship. South Africa does not recognize
UN trusteeship of Namibia.
Three decolonization issues may, however,
be raised at this session:
? Representatives from Belize may
attempt to gain assembly endorsement of
the colony's demands for independence.
Britain is willing to grant the colony in-
dependence, but Guatemalan territorial
claims complicate such a move.
? Spain is trying to extricate itself from
Spanish Sahara, and the UN has already sent
a visiting mission to test the aspirations of
the territory's inhabitants. Algeria,
Mauritania, and Morocco have historical ties
with the area and the International Court of
Justice is also involved.
? Renewed fighting or further
deterioration of the situation in Portuguese
Timor could lead to calls for a UN
peace-keeping force or at least refugee
resettlement assistance.
Administrative Hurdles
The routine administrative matters of any UN
meeting may be more difficult to dispose of this
year. The assembly has refused every year since
1970 to accept the credentials of South Africa's
delegation. This year, however, Pretoria may not
try to take part in the session, but the refusal of
credentials may be extended to additional UN
members.
Actions at the July meeting in Kampala of the
Organization of African Unity and the August
conference of the nonaligned states may have
defused a campaign led by the Palestine Libera-
tion Organization and Syria to suspend or expel
Israel from the UN. A continued stalemate in
negotiations on the Golan front, however, may
lead to attempts to curtail Israel's participation in
the assembly. Cuba may challenge Chile's
representation at the session.
Despite earlier Security Council vetoes of
their applications for UN admission, both Viet-
nams are expected to resubmit applications, even
though there is little prospect for favorable action
at this session.
The assembly may face one of its nastiest
battles in electing officers for many UN organs
and committees. These positions are allocated on
a regional basis, and each geographic group has
usually been able to resolve its own disputes.
This year, both the African and Asian groups
have competing candidates for one Security
Council seat allocated to each region, and the full
assembly will be required to decide the election.
The Asian contest includes India, Pakistan, and
the Philippines, and it could lead to splits in the 25X1
nonaligned group and the Group of 77, with im-
plications for the cooperation of the developing
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Secret
Secret
Approved For Release 2007/12/20: CIA-RDP79-00927A011100190001-0