WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A011200010001-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 26
• Document Creation Date: December 21, 2016
• Document Release Date: March 16, 2009
• Sequence Number: 1
• Publication Date: October 3, 1975
• Content Type: SUMMARY

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G,l~r~O STATES OF P~~~`GP
Weekly Summary
Secret
No. 0040/75
October 3, 1975
Copy N2 5 4
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CONTENTS (October.:?, 1975)
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- EUROPE 25X6
quently includes material coordinated with or prepared by the
Office of Economic Research. the Office of Strategic I Spain: Execution Aftermath
Research, the Office of. Geographic and Cartographic 2 France: Defense S endin ; S ace
Research, and the Directorate of Science and Technology.
j?opic r requiring more comprehensive treatment and omania- ugoslavia: China Ties
therefore published separately as Special Reports are listed 5 Austria: To the Polls
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MIDDLE EAST
AFRICA
6 Lebanon: A Shaky Truce
/ India: External Matters
Rhodesia: Nationalists Split
9 Ethiopia: Unrest Growing
EAST ASIA
PACIFIC
10 China-Vietnam: Signs of Coolness
10 Thailand: Musical Chairs
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12 Cambodia: Diplomatic Activity
13 Timor: No Solution in Sight
1 I China: A Restrained National Day
WESTERN
HEMISPHERE
III Brazil's Trade Initiative at the UN
14 Peru: Seventh Anniversary
1.6 Ecuador: Coup Plotting Continues
1 Argentina: Campora Returns
18 Chile: No Relaxation
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.uba: Promotinq Puerto Rico
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SPAIN: EXECUTION AFTERMATH
The enthusiastic pro-Franco rallies staged in
Madrid and the provincial capitals this week will
reinforce the government's decision to stand firm
in its campaign against terrorism in spite of vehe-
ment criticism from abroad. The storm of foreign
protest over the execution on September 27 of
five terrorists for killing policemen constitutes a
major setback, however, to Spain's effort to
achieve closer political, economic, and military
relations with its European neighbors.
Franco's short speech at a rally in Madrid on
Wednesday was drowned out by cheering
crowds. The impressive attendance-estimated by
the US embassy at over 200,000-reflects a
patriotic backlash to foreign criticism. This out-
burst of pro-Franco sentiment and the
government's anti-terrorism campaign are likely
to make more difficult the transition to a more
open system in the post-Franco period.
those West Europeans who see the Franco regime
as the last remnant of fascism on the continent.
East and West Europeans alike have voiced out-
rage through official statements, withdrawal of
ambassadors, mass demonstrations, and some
violence.
The governments of Western Europe are try-
ing to limit the damage to their long-term
relations with Spain, but moves to establish closer
relations with the Franco regime are precluded
for now. One of the first casualties will be the
negotiations, scheduled to begin this month, to
establish closer economic ties between Spain and
the EC.
In a televised speech to the nation on Tues-
day night, Prime Minister Arias labeled Western
criticism hypocritical and intolerable interference
in Spanish affairs. In a further show of disdain for
foreign sentiment, the government reportedly in-
tends to bring to trial soon 15 more Basques, in-
cluding the guerrilla leader accused of the
assassination in 1973 of Premier Carrero Blanco.
The few significant breaks in public order
within Spain since the executions have been a
fairly effective two-day general strike in the Bas-
que provinces and the killing of four more
policemen in terrorist attacks. Three of these ap-
parently were well-coordinated attacks in
Madrid. This brings to 16 the number of Spanish
police killed by terrorists this year.
The government's hope of reducing foreign
reaction by sparing the lives of 6 of the 11 con-
demned terrorists was dashed by the widespread
and vehement protests. The executions of the
other five loosed deeply felt emotions among
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French President Giscard has come under
sharp criticism for his government's allegedly
weak efforts on behalf of the Spanish terrorists.
The French Communist Party, seizing the oppor-
tunity to pose as a defender of liberty after a long
embarrassment over Portugal, has been extremely
vitriolic and will do what it can to keep the issue
alive. The Socialists have also protested
vociferously, and even the center and right have
been critical, although less inclined to blame
Giscard personally.
In the UK, leading government spokesmen
have defended London's effort to obtain clemen-
cy for the five terrorists. Union leader Jack Jones
has called for a labor boycott of Spanish ships, air-
craft, and trucks.
Anti-Spanish sentiment has also surfaced at
the UN. Delegates from Mexico and a number of
East and West European countries boycotted a
policy speech by the Spanish representative. The
Security Council, however, rejected Mexican
President Echeverria's request for an urgent
Council session to consider suspending Spanish
membership.
FRANCE
DEFENSE SPENDING
propose de tense spending for next year will
amount to 50 billion francs-the equivalent of
about $11 billion dollars at current exchange
rates. This is a 14-percent increase over this year's
outlay for defense. The increase in real spending,
however, will come to no more than 5 percent
after inflation is taken into account. The National
Assembly will debate the proposal this month.
Defense Minister Bourges said earlier this
year that France could not keep its forces at pre-
sent levels and also put his reform program into
effect unless the 1976 defense budget grew by at
least 20 percent. President Giscard reportedly
settled on 14 percent after he had heard from the
minister of finance. Most of the budget increase
probably will be used to cover the cost of pay
raises and other personnel benefits ordered
earlier this year to alleviate morale problems in
the armed forces.
Operating costs will absorb about 58 percent
of the military budget, up 2 percent from 1975.
This growing imbalance is causing problems on
the capital expenditures side of the budget, and
the government will have to re-evaluate its
priorities for new military hardware. All branches
of service will feel the effects. Even so, France has
one of the most ambitious defense spending
programs in Europe, and the percentage of spen-
ding devoted to hardware purchases probably
will still top that of many of France's neighbors.
The nuclear programs will retain a most-
favored status. Nearly one third of all equipment
funds will go for these programs with more going
to the strategic programs than the tactical ones.
An increase in funds has also been authorized for
France's Pacific nuclear test center, probably
because of the higher cost of underground
testing.
The air force will order 33 of the new Fran-
co-German Alpha Jet trainers for delivery begin-
ning in 1978, and the tactical air forces will get 10
more Anglo-French Jaguar fighter-bombers.
Budgeting for future aircraft programs will be
kept to a minimum, and the fate of the next
generation ACF fighter and a proposed
long-range transport will remain in doubt.
The navy will receive two new conventionally
powered attack submarines, and construction on
several new frigates and corvettes will continue.
Money reportedly has been authorized to begin
construction of France's first nuclear-powered at-
tack submarine, and design work on a nuclear-
powered helicopter carrier will continue. The
navy will slow its purchases of Super Etendard at-
tack aircraft and additional Exocet anti-ship mis-
siles.
Little information has been released on
procurement plans for the ground forces. The
army apparently will get some money for im-
proved Hawk surface-to-air missiles.
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SPACE PROGRAM TAKES A BREAK
The French successfully launched a scientific
satellite into space last weekend, using a Diamant
BP4 rocket fired from French Guiana. This marked
the last of three shots using this improved version
of the Diamant-B rocket. France will now concen-
trate on developing the larger Ariane-an all
European satellite launch vehicle.
The Ariane launch vehicle is a cooperative
program of the ten-nation European Space Agen-
cy (ESA). The booster is based on the former
French L-3S satellite launcher and will be capable
of launching satellites of up to 1,650 pounds into a
geosynchronous orbit, or a payload of 5,500
pounds into a low-earth orbit. France will take on
almost two thirds of the development costs. West
Germany will be the other major con-
tributor-about 20 percent.
The ending of the Diamant program and the
development plans for the Ariane rocket have left
the French base in Guiana without a planned
satellite launching until the summer of 1979,
when the Ariane is ready. Meanwhile, the rocket
base will be maintained in a caretaker status.
Ground testing of the assembled Ariane is not ex-
pected for at least another two years. Civil
engineering work at the construction site of the
Ariane launch pad reportedly has begun and will
take about two years to complete.
The French will continue to pay at least two
thirds of the operating costs of the facility when it
reopens. The other members of ESA will con-
tribute the balance. Because of this larger share,
the range will remain French, and Paris will retain
the right to use the facilities for purely national
purposes. The French say that priority will be
given to ESA projects.
Many European political leaders have
questioned the need for Europe to develop an in-
dependent launch capability. Previous
failures-most notably the Europa launcher
program-have prompted them to ask whether
Europe might be better advised to leave launcher
development to the US and spend its money on
spacecraft.
Diamant BP4
The French Space Agency this year estimated
that between 20 and 40 Ariane launchers could be
required between 1980 and 1990, provided the
European rocket could be offered at a com-
petitive price.
The French have long argued that Europe
needs an independent launch capability.
Although they recognize that the US probably
will continue to offer launch vehicles that will cost
much less than.the Ariane, they point out that the
US has not been willing to provide launchers
without restrictions on using them for orbiting
either communications or military satellites.
Although French military space projects ap-25X1
parently are still in early development, Paris has
indicated an intent to launch satellites with
military applications.
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ROMANIA AND YUGOSLAVIA: CHINA TIES
Ceausescu and Tito seem to be working
together to expand their contacts with China and
thus to counter what they regard as Moscow's
"hegemonist" aspirations.
An unprecedented number of high-level
Romanian delegations-five at last count-went
to China last month. They were led by such rank-
ing officials as the party secretary for cadre affairs,
the secretary for economics, the head of military
intelligence, and a deputy defense minister.
These visits-coming in the wake of fresh
assaults on Peking by the Kremlin-underscore
Romanian determination to resist any Soviet
pressure to read the Chinese out of the inter-
national communist movement. They also suggest
a high degree of confidence that Ceausescu will
be able to cope with the irritation that the visits
are certain to cause in Moscow.
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While the Romanians were in Peking,
Belgrade was making the final arrangements for a
long-delayed upgrading of its contacts with
China. Premier Bijedic-the highest ranking
Yugoslav ever to make an official trip to
Peking--is scheduled to arrive on Monday for a
six-day visit.
Just prior to Bijedic's departure, his Roma-
nian counterpart went to Belgrade to set up a
mid-October meeting between Tito and 25X1
Ceausescu. Their talks will probably center on still
further cooperation that could be read as a
message of defiance in Moscow.
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AUSTRIA: TO THE POLLS
Austrians go to the polls on October 5 to
determine whether Socialist Chancellor Bruno
Kreisky will retain his mandate for another four
years. The Socialists probably will obtain a plurali-
ty, but Kreisky's hope to retain the majority he
won in 1971 is in some doubt. If he narrowly mis-
ses a majority, he may form a minority govern-
ment, as he did in 1970, or co-opt selected
members of other parties into a "government of
experts."
Although generally opposed to a coalition
government, Kreisky may have to consider the
possibility if the gap is more than a few seats short
of a majority. The tiny Liberal Party would be his
most likely partner and Kreisky probably would
only consider a "grand coalition" with the
People's Party as a last resort.
The scarcity of issues has made for a dull cam-
paign. With the possible exception of the
economy and one or two regional questions,
most talk has centered on personalities.
The problem with the economy is that after
nearly six years of boom, moderate inflation and
marginal unemployment have begun to stir up
discontent. The fuel crisis in 1973 marked the
beginning of a gradual decline in economic
growth rates. Although inflation is well below that
of most industralized countries-Austria's rate
was 8.3 percent in June-dissatisfaction among
consumers is widespread. Unemployment is
about 2 percent, also below the West European
average, but one of the most debated issues in the
campaign.
Kreisky began an anti-inflationary stabiliza-
tion program in 1972. He has emphasized that he
will not create more unemployment in order to
curtail inflation. The main thrust of the op-
position's campaign, nevertheless, is the specter
of greater joblessness.
A few regional issues have played a small part
in the campaign. Delay in completion of the
country's south autobahn has annoyed Austrians
and tourists alike, but the government probably
will plead austerity on this issue. Kreisky's failure
to provide bilingual road signs in Carinthia has
alienated the Slavic minority in that state, but may
win some support from the German-speaking
majority there. No significant foreign policy elec-
tion issues have surfaced.
Kreisky's challenger is the chairman of the
People's Party, 42-year-old Josef Taus, who was
elected after the accidental death of Karl
Schleinzer in July. Taus-a self-made man from a
working class family-has general appeal and, un-
like his predecessor, is on an intellectual par with
Kreisky. 25X1
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Chancellor Kreisky
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LEBANON: SHAKY TRUCE
Fighting in Beirut between Christian and left-
ist militias flared up again in midweek after
several days of relative calm during which the
cease-fire announced last week appeared to be
finally taking hold. A collapse of the fragile truce
would probably bring to a quick end the current
reconciliation talks among the leaders of
Lebanon's numerous competing factions.
The latest fighting followed the shooting
deaths on September 30 of eight people, at least
three of whom were members of the Druze sect,
in a Christian suburb of the capital. Progressive
Socialist Party leader Kamal Jumblatt, a Druze,
blamed the shooting on the Phalangists and
demanded that the killers be turned over to the
authorities. The Druze have in the past tended to
side with the Shia Muslims.
The 20-man national reconciliation com-
mittee under the leadership of Prime Minster
Karami has thus far focused largely on security
issues. Agreements were reached early in the
week to remove barricades and end sniping and
kidnaping. After the incidents on October 1,
however, barricades went back up in many areas
and a number of people were kidnaped.
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Destruction in downtown Beirut
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Problems raised by the make-up of the com-
mittee, which includes 10 Muslims and 10
Christians, could complicate the talks. Conser-
vative Shia Muslims and some Christians claim
they are underrepresented. The leftists, however,
are opposed to any attempt to increase the com-
mittee's membership. The committee has put
aside, at least temporarily, the troublesome ques-
tion of Lebanese-Palestinian relations, which had
been raised by Phalangist leader Pierre Jumayyil.
Christians, Muslims, and Palestinians are
almost certainly all engaged in re-equipping and
rearming their forces. The more moderate
fedayeen organizations as well as the Shias and
the pro-Syrian Baath Party of Lebanon probably
have been receiving arms and ammunition from
Syria.
The US embassy in Beirut reports that sub-
stantial damage has been done to the capital dur-
ing the latest round of fighting. The damage to
the commercial and industrial areas alone is es-
timated in the hundreds of millions of dollars. The
middle class, made up of shopkeepers and other
self-employed businessmen, has been particularly
hard hit. About one quarter of this group is said to
be on the verge of destitution. The embassy now
estimates that since the fighting broke out in late
August at least 500 persons have
died.
INDIA: EXTERNAL MATTERS
The military-led coup in Bangladesh in
August was a distinct setback for India, costing
New Delhi the strong influence it had exerted in
Dacca since Bangladesh became independent in
1971. It now appears Prime Minister Indira
Gandhi's government may be unwilling to stand
idly by while the new regime in Dacca seeks to
balance its foreign relations and establish ties with
India's adversaries, China and Pakistan.
The desire of Bangladesh's new leaders for a
more balanced foreign policy is clearly viewed
with suspicion by New Delhi. The Indians see ear-
ly recognition of the new regime by Pakistan and
China as part of a scheme aimed at introducing an
element of uncertainty for India on its eastern
flank. Dacca is aware of New Delhi's distrust and
has tried to reassure the Indians that the In-
do-Bangladesh friendship treaty, signed in 1972,
is still a cornerstone of Bangladesh's foreign rela-
tions.
Developments in Bangladesh probably have
also contributed to a downward trend in In-
do-Pakistani relations. Two sets of bilateral
negotiations-one related to the design of an In-
dian dam that will affect Pakistan's water supply
and another on the restoration of civil air
flights-are now deadlocked. Additionally, the in-
termittent propaganda war between New Delhi
and Islamabad has heated up, and the two coun-
tries are engaged in a bitter contest for a two-year
term on the UN Security Council.
In contrast, Indo-US relations could be on
the upswing. On October 6-7, Foreign Minister
Chavan will be in Washington to inaugurate a
bilateral commission aimed at expanding
relations in the fields of economic, commercial,
educational, cultural, scientific, and technological
affairs. Gandhi's bid for closer relations
presumably is motivated largely by the economic
incentive for increased US aid and trade, but also
by a desire to demonstrate that India remains a
nonaligned state despite its strong ties with the
USSR. Nonetheless, Gandhi's basic suspicion of
US intentions and activities abroad and her sen-25X1
sitivity to Western criticism of her authoritarian
rule stand in the way of a truly harmonious
relationship.
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RHODESIA: NATIONALISTS SPLIT
Rivalry among factional leaders of the
Rhodesian African National Council, the umbrella
organization formed by four black nationalist
groups last year, has pulled the council apart. A
national congress in Salisbury last weekend
elected Joshua Nkomo, a moderate who favors
negotiating a settlement with Prime Minister Ian
Smith's white regime, to the council presidency.
Other council leaders condemned the national
congress as illegal and scheduled a rival congress
for October 19.
Nkomo's election by several thousand
delegates who convened in the Rhodesian capital
lends some support to his claim that his faction
controls a majority of the council's local branches
inside Rhodesia. Nkomo faces bitter opposition,
however, from Ndabaningi Sithole, the militant
leader of an important rival faction that has long
wanted to scrap settlement talks and resume
all-out guerrilla warfare in Rhodesia. Bishop
Muzorewa, who was installed as a compromise
figurehead president of the council when it was
formed in December 1974, also vehemently op-
poses Nkomo's bid for leadership. Although
Muzorewa has advocated a negotiated settle-
ment, his breach with Nkomo has sealed his
dependence on Sithole and the other militant ex-
iles.
Last month Muzorewa expelled Nkomo from
the council for setting up the recent congress
over Muzorewa's objections. The presidents of
Zambia, Tanzania, Mozambique, and Botswana,
who have been trying to unify the council for
talks with Smith, subsequently met with the
Rhodesian nationalists in Lusaka, but were unable
to heal the rift.
The reaction of the four presidents to
Nkomo's election is not yet known, but it will be a
critical test of their cohesion. There have been in-
dications that Zambia's Kaunda, who does not
want new fighting, in Rhodesia because it would
intensify his country's economic problems, and
perhaps President Khama of Botswana, might
accept Nkomo. It is doubtful, however, that
Kaunda and Kharna could persuade Tanzanian
President Nyerere and Mozambique's Machel,
who have had closer ties with Sithole's faction, to
go along.
At this point:,, the four presidents probably
have no firm ideas about how to proceed. They
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Bishop Muzorewa
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may await the results of the rival congress before
committing themselves to new courses of ac-
tion.
ETHIOPIA: UNREST GROWING
Faced with strikes by disgruntled workers, the
ruling military council this week issued a tough
state of emergency declaration in Addis Ababa.
The coercive tactics forced most of the strikers to
resume work, but the council has apparently
widened the breach between it and influential
leftist union elements. Meanwhile, insurrections
led by conservative landlords are posing an in-
creasingly serious threat to the council's control
of the northern provinces.
Labor leaders for some time have been dis-
satisfied with military rule and the council's
failure to satisfy specific labor grievances. On
September 22, the Confederation of Ethiopian
Labor Unions, the country's central labor
organization, adopted a resolution threatening a
general strike unless power was returned to
civilian hands within a month. The resolution also
said workers would strike if any confederation
leaders were arrested or if the council attempted
to interfere with distribution of the resolution,
which is highly critical of the military leadership.
Late last week at least seven workers were
killed and 19 wounded in a clash with security
forces who were attempting to arrest airline
employees for distributing copies of the labor
resolution. In a separate incident, the council also
arrested about 30 teachers for distributing an-
ti-regime leaflets. In response, workers in Addis
Ababa began leaving their jobs, but the council's
crackdown prevented a general strike. The
sweeping emergency proclamation, issued on
September 3.0, permits the arrest of all strikers
who do not return to work, the search of homes
without warrants, and the detention of individuals
for an unlimited period without charges.
During the past several weeks insurgent ac-
tivity in Wollo, Tigre, Begemdir, and Gojjam
provinces has grown markedly. Conservative
peasants appear to be cooperating with
traditional leaders in carrying out increasingly
better organized operations against government
security forces. The insurgents recently killed the
chief administrator and three other officials of
Begemdir Province and also forced the evacua-
tion of Chinese road builders. Last month the
council airlifted troop reinforcements to the area
from the Ogaden, the region adjoining Somalia. 25X1
Begemdir and Tigre are the home provinces,
respectively, of former general Nega Tegegne and
Ras Mengesha Seyoum, two important tribal
leaders. They fled Ethiopia last year and have con-
tacted other former officials about planning a
resistance movement. Some of the recent dissi-
dent activity was almost certainly carried out by
their followers. The US embassy, in fact, recently
received information that Ras Men esha has
returned to Tigre.
Port
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CHINA-VIETNAM: SIGNS OF COOLNESS
A North Vietnamese delegation, led by party
chief Le Duan, apparently ran into heavy sledding
in talks with its Chinese hosts during a visit to Pe-
king last week.
Although agreements were signed on trade
and the provision of an interest-free loan to
Hanoi, signs of coolness between the two sides
were evident throughout the visit. Chinese press
coverage was less enthusiastic than it was during
Le Duan's last visit in 1973, and the speeches on
both sides reflected differences of view-notably
regarding Moscow's role in Vietnam and
Southeast Asia. Most significantly, no joint com-
munique was issued at the end of the visit, and
the North Vietnamese failed to host a reciprocal
banquet for the Chinese.
The reference to an interest-free loan in the
economic agreement is itself new and suggests
that Peking no longer feels an obligation to
provide Hanoi with non-refundable aid. This con-
trasts sharply with Peking's attitude toward the
new communist regime in Cambodia, to which
the Chinese only two months ago agreed to
provide grant aid.
The question of sovereignty over the Paracel
and Spratly islands in the South China Sea may
also have upset the discussions in Peking. Just
prior to the delegation's departure for Peking,
two Chinese broadcasts to Vietnam underscored
Peking's claims to both island groups.
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Le Duan returned to Hanoi after the China
trip, and a few days later departed for Eastern
Europe.
The Soviets will surely try to take advantage 25X1
of current Hanoi-Peking differences to improve
their own influence in Hanoi and will offer at least
matching economic assistance.
25X1
THAILAND: MUSICAL CHAIRS
The desire of newly retired army commander
Krit Siwara to remain a power in Bangkok by
assuming a high-level cabinet post has created
serious strains in the Khukrit coalition govern-
ment. It seems likely that General Krit's political
ambitions will force Prime-Minister Khukrit to
shuffle his cabinet and possibly realign the ruling
coalition as well.
Krit is lobbying for the defense portfolio. He
sees the position as a means of retaining his in-
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fluence in the army, protecting his considerable
financial interests, and furthering his political am-
bitions. Krit's plans, however, have run into a
serious snag. The current defense minister,
Praman Adireksan, has made it clear that he is not
prepared to step aside to make room for Krit.
Prime Minister Khukrit is in a difficult situa-
tion, because he cannot afford to alienate either
Krit or Praman. Krit was instrumental in bringing
together the various conservative factions in sup-
port of Khukrit last April. Praman, on the other
hand, heads the Thai Nation Party, the third
largest in the National Assembly and a key
member of the coalition. He is threatening to pull
his party out of the government if Krit is given the
defense portfolio.
Khukrit has announced that he will not shuf-
fle his cabinet until the budget bill is passed by
the National Assembly; this should take place
within the next two weeks. By postponing choos-
ing between Praman and Krit, Khukrit probably
hopes each will use his considerable influence in
the National Assembly to ensure passage of the
budget.
If Praman does thwart Krit's desire to become
defense minister, Khukrit's most likely option
would be to offer Krit another cabinet post. While
it is possible that the Krit-Praman clash could
bring down the governing coalition, Khukrit
would almost certainly come out on top of any
new coalition to emerge from the National
Assembly.
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CAMBODIA: DIPLOMATIC ACTIVITY
'The communist regime in Phnom Penh has
stepped up its diplomatic activity recently in an
apparent effort to broaden its international con-
tacts.
France
Deputy Prime Minister for Foreign Affairs
leng Sary told newsmen in Paris in
mid-September that he wanted to normalize
Cambodian-French relations "in the near future"
and that Paris could play an important role in
Cambodia. Although the French are still miffed
over the treatment their people received when
the communists took over Phnom Penh, they are
nevertheless eager to re-establish their presence
in Cambodia. The French intend to treat Prince
Sihanouk cordially when he stops in Paris early
this month on his way to New York to address the
UN, and talks on re-establishing relations could
well be in the offing. The Cambodians probably
regard France as a potential aid donor.
Thailand
There has also been progress in the develop-
ment of Cambodian-Thai relations. Officials of
the two countries have held meetings in New
York, and the Thai foreign minister announced
recently that a high-level Cambodian of-
ficial-either Foreign Minister Sarin Chhak or
possibly leng Sary-had agreed to visit Bangkok,
probably in late October. Topics on the agenda
will include the establishment of diplomatic
relations, trade, and probably border security
problems, and the status of Cambodian refugees
in Thailand' as well.
Special Friends
The North Vietnamese ambassador to Cam-
bodia arrived in Phnom Penh on September 19.
The Chinese ambassador arrived earlier in the
month. There are also signs that Phnom Penh may
receive other envoys from friendly communist
and nonaligned countries. Diplomatic sources in
Peking have claimed that Cambodia will allow the
opening of ten embassies in the capital by the end
of the year. The others: Yugoslavia, Egypt, North
Korea, Algeria, Albania, Romania, Mauritania,
and Laos.
USSR
The Cambodians will proceed carefully in
working out new relationships with Moscow. Ties
between the USSR and the Khmer communists
have been strained and tenuous, as indicated by
Moscow's refusal to break relations with the Lon
Nol government until the last days of the war.
Deputy Prime Minister Khieu Samphan and
Sihanouk met with Soviet representatives in
Hanoi in early September, but there has been no
indication that the dialogue will be continued
soon.
Other Moves
The Cambodian embassy in Peking has also
begun to acknowledge earlier recognition of the
Khmer communist regime by several non-com-
munist countries.. Letters have been sent thanking
the governments of Australia, Japan, and other
non-communist Asians. Although the Japanese
consider that relations have been re-established,
they are proceeding cautiously and have no
near-term plans to follow up on Phnom Penh's
response on recognition. The establishment of
Cambodian-Mexican relations at the am-
bassadorial level was also recently announced,
following a brief visit by leng Sary to Mexico City
in mid-September. Despite the appearance of a
more forthcoming Cambodian attitude, it will
probably be some time before ambassadors from
non-communist countries are permitted to reside
in Phnom Penh. The Khmer communists are
highly suspicious of "foreign" influence and do
not want non-communist diplomats in Phnom
Penh at this earl stage reporting on conditions in
the country.
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TIMOR: NO SOLUTION IN SIGHT
The impasse over Portuguese Timor con-
tinues. The new Portuguese government says it is
ready for talks that would lead to an incorpora-
tion of Timor into Indonesia, and President Suhar-
to has again agreed to sound out the Portuguese.
The Indonesians remain skeptical of Portugal's
motives, however, and have little hope that any
settlement will emerge.
The radical Fretilin party, whose forces now
control most of Portuguese Timor, is adamantly
opposed to even participating in any talks that in-
clude its local rivals. Fretilin asserts that its de fac-
to control of the territory entitles it to represent
all Timorese in any discussions about the
territory's future.
The pro-Indonesia forces, even with the aid
of Indonesian special forces units, apparently
have been no match for Fretilin's troops. For the
short term, Fretilin has the upper hand and may
soon decide to announce Portuguese Timor's in-
dependence.
Suharto, for his part, is still standing firm
against the desires of the Indonesian military to
send large numbers of Jakarta's troops into Por-
tuguese Timor.
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CHINA: A RESTRAINED NATIONAL DAY
National Day ceremonies this year were
more subdued than usual. For the first time in
four years, there was no authoritative editorial
in Peking's major publications, and the
festivities were marred by the absence of ailing
Premier Chou En-lai.
Most national leaders were on hand for 'a
reception given in Chou's name on September
30 and for parties in Peking's parks the follow-
ing day. Young party Vice Chairman Wang
Hung-wen appeared in his home town ' of
Shanghai. He reportedly has been in neighbor-
ing Chekiang Province to oversee efforts to
restore order there.
Senior Vice Premier Teng Hsiao-ping,' who
served as host at the reception, emphasized
unity, stability, and economic progress inn his
toast. He made no reference to the current dis-
cussion of the ancient Chinese novel Water
Margin, suggesting that study of the novel is
not intended to become a major political cam-
paign.
The large turnout at the reception reveal
ed some new appointees to the national
military hierarchy. Former, chief of staff Lo
Jui-thing, who was rehabilitated without an of-
ficial post two months ago, has apparently join-
ed the national military apparatus. Another
rehabilitated official_with close ties to Teng has
also gained a central military post, reflecting
Teng's.; continuing' efforts to consolidate his
power in the military. In addition, several,
military men who until recently were serving in
the provinces have apparently been named to
positions in the national rrtilitary structure.
Several former cultural and: propaganda
officials made their first public appearance
since the Cultural Revolution of the mid-1960s
These were second-echelon bureaucrats, but
their rehabilitation adds weight to reports that
leading cultural figures of the past, who were 25X1
among the earliest victims of the Cultural
Revolution, have been reinstated to part `
ositions in ding.
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BRAZIL'S TRADE INITIATIVE AT UN
Brazilian Foreign Minister Antonio Azeredo
da Silveira is continuing efforts to focus world
attention on his proposal to reform trade relations
between the developed and less-developed
nations.
During the past month, Silveira has made two
speeches to the UN General Assembly
recommending that a new framework be es-
tablished for conducting bilateral negotiations.
Silveira argues that there is a growing need to give
less-developed countries effective access to in-
dustrial markets and at the same time guarantee
developed nations adequate supplies of raw
materials. Although his initiative has been
moderate in tone-apparently designed to por-
tray Brazil as a constructive spokesman for the
less-developed countries-it constitutes a marked
departure from the low profile Brazil usually
maintains in international forums.
There is reason to believe that Silveira is
largely representing his own views and not
necessarily those of the Brazilian government.
During his assignment as head of Brazil's delega-
tion to the UN office in Geneva from 1966 to 1969,
Silveira reportedly favored the use of large
deliberative bodies to resolve trade issues. Also,
he is not known to have obtained wide support
within the government prior to his appearances at
the UN, nor has he followed up with specific
plans for implementing his proposals.
The fact that :Silveira has come back to the
subject twice within a three-week period suggests
that he at least has the backing of President
Geisel. Brazil, as an emerging world power, can
appreciate the major concerns of industriaiized
nations and can understand common problems of
economic growth among the less-developed
countries. Brasilia may now see its international
role as a mediator between com etin , in-
terests.
PERU: SEVENTH ANNIVERSARY
The military government today celebrates its
seventh anniversary-under new leadership and
amid signs of important administrative changes
affecting the pace and style of the revolution. At
the same time, President Morales Bermudez faces
many of the same political and economic
problems, including intra-military rivalries and
labor unrest, that stymied his predecessor.
Since taking office August 29, Morales Ber-
mudez has indicated his administration will tackle
Peru's many problems with more flexibility and
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less personalism than did President Velasco. Over
the longer term, this approach is likely to yield
some success in building greater popular support
for the armed forces and in providing the govern-
ment with a more efficient and responsive
bureaucracy. For the time being, however,
Morales Bermudez will be pressed to convince
more radical officers that his new economic
policies, including a 12.8-percent devaluation,
will reverse recent setbacks and that this and
other measures will not increase civilian antipathy
for the military.
The devaluation, announced last week by the
new civilian economy minister, is a sharp depar-
ture from Velasco's policy. The former president
was particularly sensitive since the previous
devaluation by civilian president Belaunde had
figured prominently in his ouster by the armed
forces in 1968. Morales Bermudez' own economic
expertise-he served as economy minister from
1969 through 1973-and his currently strong
military support should afford him sufficient time
to undo some of the economic excesses of the
Velasco administration.
The President's plan for streamlining the
cumbersome military bureaucracy in order to
create a more efficient policy mechanism and
allow top officials more time to concentrate on
long-range policies includes measures to weaken
some of the prerogatives of the presidency. A
likely offshoot of this program will be a greater
role for civilians in setting government policy.
Morales Bermudez' concern for maintaining sup-
port of the radical officers at least for the time be-
ing may cause this process to move slower than he
would like, but some further loosening of
restraints on political and journalistic freedom is
likely.
Reported maneuvering by less extremist of-
ficers to get the President to move against more
radical officers is indicative of the mistrust and
ideological disagreement present beneath the
facade of military unity. Like his predecessor,
Morales Bermudez is certain to have difficulty in
balancing these various factions and personalities.
For the time being, the President's desire and
need for solid military backing for his domestic
programs will probably cause him to seek some
compromise. He may be counting on the success
of economic and political liberalization measures
to enable him to resist pressure from the radicals.
A more immediate problem for the President
is the threat to the viability of his economic
programs posed by recalcitrant labor groups.
Many of the unions are led by leftists who de-
mand frequent and sizable wage increases and
other unrealistic concessions by the government.
At this time, Morales Bermudez can probably 25X1
count on solid military support in resisting labor
opposition, but other military leaders-particular-
ly those who strongly supported Velasco-might
go into opposition if prolonged or serious
resistance to the new policies develop s.
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ECUADOR: COUP PLOTTING
The military and political discontent that
precipitated a coup attempt on September 1 has
not gone away, and President Rodriguez Lara
faces an uncertain future.
The army is upset about personnel policies
affecting it and the failure of the government to
replace obsolete equipment. Rodriguez' recent
cancellation of approved expenditures for new
military equipment, although dictated by
economic necessity, has further irritated military
leaders.
A number of military officers are deeply con-
cerned about the government's handling of the
economy. In conservative business circles, there is
considerable talk about the military government's
ineptness in managing the economy. Politicians
and the news media are complaining more
vigorously that the President has yet to fix any sort
of schedule for a return to constitutional govern-
ment. As a consequence, the divided political
leaders are reportedly drawing together in an ef-
fort to bring down the government, which they
perceive to be considerably weakened by the
events of last month.
Rodriguez and his closest supporters are
acutely aware of the government's present
vulnerability. The euphoria induced by his quick
victory over a handful of coup leaders quickly
gave way to dismay as Rodriguez learned that
many more senior officers had considered joining
the plot. Initially surprised by the widespread dis-
satisfaction within the armed forces, he is now
reported to realize that he is becoming daily more
separated from the military and that there is no
quick and easy way to reverse this trend.
To gain time for an orderly return to civilian
government, Rodriguez has placed heavy
emphasis on winning back and maintaining the
support of the military. He is working against
strong odds. The question of how to deal with the
military officers involved in the coup attempt
would appear to be the biggest immediate
problem. If justice is harshly imposed, Rodriguez'
hopes of rebuilding the armed forces' unity will
collapse, and he could precipitate another
coup.
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ARGENTINA: CAMPORA RETURNS
Former president Hector Campora has
returned to Argentina, undoubtedly hoping to
cash in on the growing confusion and fragmenta-
tion within the Peronist movement.
Campora, at one time the darling of the
Peronist left, reportedly promised the govern-
ment that he would stay out of politics if allowed
to return from exile in Mexico. He specifically
ruled out any dealings with the dissident Au-
thentic Peronist Party, from which he dissociated
himself last July.
It will be difficult for Campora to remain out
of the political limelight for very long. Although
his spokesmen announced that he had no
political plans, Campora could not resist telling
reporters on September 27 that he had come back
to be "a factor of unity and characterizing
himself as a "man of involvement. Two days later
he issued a platitudinous statement invoking the
name of Juan Peron and offering his services "to
the cause of the people."
Campora's presence undoubtedly is viewed
with disquiet in conservative Peronist and military
circles. They recall the extreme leftist influence in
the government and the indignities the armed
forces suffered during Campora's six-week
presidency in May-July, 1973.
Loyal Peronists will also remember that from
his deathbed Peron ordered Campora fired from
his ambassadorship in Mexico and expelled from
the Justicialist Party. Peron's move came after
Campora hurriedly returned to Buenos Aires to
sniff the political wind upon learning that the ag-
ing dictator was seriously ill.
Campora will have to exercise extreme
political and personal circumspection. He will
need to eschew leftist connections and keep off
the target lists of the right-wing death squads who
earlier threatened to assassinate him. Campora
probably will try to appeal first to the middle road
of Peronism. Because he is unlikely to find sup-
port there, he will be susceptible to blan-
dishments from the left wing, which badly needs a
figure of national prominence as a rallying point.
The 66-year-old Campora has survived the25X6
rough and tumble of Peronist politics for over 30
years, and he may gradually e able to rebuild his
political fortunes.
e may25X6
be drawn too soon into the political arena, and his
trv for a political comeback will be short-lived.
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CHILE NO RELAXATION
Actions of the past week leave little prospect
that the government will soon relax its tough
?;tance on security or its ban on politics.
When a dozen former Allende officials were
released on September 12, it was announced that
some charges remained pending against them.
Now the navy has begun proceedings against at
least six of these persons, including Luis Corvalan,
secretary general of the Communist Party, on
charges of "subversion."
The Ministry of Interior also announced that
the Christian Democratic Party--Chile's
largest-will not be permitted a voice in running
the government. The statement came alter public
airing of correspondence between two party
leaders, which in effect reaffirmed the party's
desire to reach an understanding with the military
government so that the country eventually could
return to traditional democratic processes. The
government's reaction was a categorical rejection
of any possible constructive dialogue with the
party on this basis. The government's statement
raised the threat of punishment for activity con-
trary to terms of the political recess.
One effect of the statement will be to com-
plicate President Pinochet's proposal on
September 11 to form a "council of state," com-
posed of former presidents and prominent
Chileans, to advise the government. Former presi-
dent Frei, the most prominent Christian
Democrat, will find it even more difficult to par-
ticipate now that his party has been so strongly
rebuffed.
Internally, these issues will have little lasting
effect. On the international scene, however, they
come at a bad time for Chile. Efforts to improve its
standing will be severely damaged. Belgium, West
Germany, and the UK hope to sponsor a resolu-
tion in the UN condemning Chile's human rights
stance. Denmark, France, Luxembourg, and
Several other countries apparently approve the
Belgian draft.
In the meantime, Pinochet reportedly has
conducted an investigation of the human rights
In July, the President warned.the
high oc mm and of the armed forces that severe
disciplinary action would result if authority in
these areas was "exceeded."
In yet another effort to improve its image
abroad, Chile has begun a campaign to have the
1976 OAS General Assembly held in Santiago. The
regime believes that if Chile succeeds in these ef-
forts, representatives of the American nations can
see for themselves that Chile's enemies have ex-
aggerated the human rights issue.
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the risk of slowing the accommodation with the
US.
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CUBA: PROMOTING PUERTO RICO
Prime Minister Fidel Castro gave further
evidence in a speech this week that his govern-
ment intends to uphold the Cuban position of
promoting Puerto Rican independence even at
In endorsing this position, he lent his per-
sonal prestige to an issue that has become a major
stumbling block in the path of normalizing
relations with the US. His remarks apparently
were intended as a response to what he labeled
"strong statements" by US officials.
In a speech devoted largely to internal affairs,
Castro spoke briefly about Puerto Rico and the
US. He implied that Cuban solidarity with the
cause of Puerto Rican independence is a matter of
principle that will not be renounced in order to
improve relations with the US. He added, "If that
is not understood, we will know how to be as
patient as necessary."
Contrary to some press accounts of the
speech, Castro did not depart from the now-stan-
dard Cuban position regarding Puerto Rico.
Nothing that he said indicated a retreat from his
stated willingness to begin negotiations with the
US to settle bilateral differences.
There may be more flexibility in the Cuban
position than appearances suggest. In the final
analysis, rather than risk torpedoing the chances
for a normalization of relations with the US, the
Castro regime would probably accept some for-
mula that would trade a temporary softening of its
Puerto Rican independence campaign for US
negotiating concessions.
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