WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A011300070001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 28
• Document Creation Date: December 21, 2016
• Document Release Date: January 15, 2008
• Sequence Number: 1
• Publication Date: February 13, 1976
• Content Type: SUMMARY

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Secret
Weekly Summary
Secret
CI WS 76-007
No. 0007 / 76
February 13, 1976
Copy N2 64
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Aw
SECRET
Ki.Y 5UMMAF Y, issued e' .
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CONTENTS (February 13, 1976)
MIDDLE EAST
AFRICA
1 Angola: Movement Onslaught
3 USSR-Angola: More Tough Talk
4 Lebanon: Inching Ahead
4 France-Somalia: Heating Up
5 Morocco-Algeria: No Solution
7 Italy: Respite But No Solution
8 France: Crucial Congress
10 USSR: Party Congress
11 Spain: Government Initiative
12 Iceland: Tensions Increase
13 NATO: Arms Cooperation
14 Balkan Cooperation
14 Albania: State of Paranoia
EAST AS I A
PACIFIC
15 China: "Acting" Premier
17 Japan: Trade Surplus; Scandal
18 Indonesia: Last Act in Timor
WESTERN
HEMISPHERE
19 Cuba: Constitutional Referendum
19 Guatemala: The Earthquake
21 Guyana: Toward a One-Party State
21 Argentina: Labor Support Wanes
22 Peru: Labor Woes
Comments and queries on the contents of this
publication are welcome. They may be
directed to the editor of the Weekly
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ANGOLA: MOVEMENT ONSLAUGHT
The Popular Movement, spearheaded by
Cuban troops using Soviet-supplied armor,
scored major gains this week against the forces of
its adversaries, who appear unlikely to be able to
wage conventional warfare much longer. With
the Movement on the way to occupying the
remaining population centers, African states that
had resisted the Luanda regime's push for accep-
tance as the government of Angola at the OAU
meeting last month are jumping on the
bandwagon. Many African states, including some
that came out for the Popular Movement before it
established its ascendancy, are looking for ways to
promote a political accommodation between the
Movement and its two rivals, but so far Move-
ment leader Agostinho Neto has shown no
willingness to listen.
Military Situation
Huambo, Angola's second largest city, was
taken early on February 9 by a Popular Movement
force that reportedly consisted of several thou-
sand Cubans backed by T-34 tanks, helicopters,
and 122-mm. rockets. Huambo had also served as
the capital of the nominal joint government
proclaimed last November by the National Union
and National Front; the few "administrators" in
residence evacuated the city in advance of its fall.
In acknowledging the loss of Huambo, a
spokesman for the southern-based National
Union indicated publicly this week that his group
would not be able to field a conventional force
for long and would have to revert to the guerrilla
tactics it had long employed against the Por-
tuguese. He vowed, however, that the Union
would fight on. National Union forces that had
been defending Huambo withdrew to Bie, the
group's main military headquarters. That city fell
on February 11, and Union President Savimbi has
withdrawn to the remote southern town of Vila
Serpa Pinto.
The Popular Movement's drive into the
National Union's tribal territory made progress
along the coast, too. On February 10, a Movement
force apparently occupied the vital
Benguela-Lobito port and rail complex. Union
troops in the area were reportedly ordered last
weekend to begin withdrawing southward. Neto's
forces may next concentrate their main efforts on
extending and consolidating their hold over the
populous central area and the Benguela Railway
lifeline. Luso, in eastern Angola, is sure to be an
early target.
In northern Angola, tank-led Cuban and
Popular Movement forces advancing from Am-
brizete took Tomboco and the coastal port of
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Santo Antonio do Zaire last weekend. The Front
has apparently also evacuated Maquela do Zom-
bo and will probably soon abandon Sao Salvador,
its last position of any size. Most of the Front's
forces have retreated into Zaire.
Political Developments
Cameroon extended official recognition to
the Luanda regime last week, and Uganda, Togo,
Gabon Ivory Coast, and Upper Volta followed suit
this week. The Neto regime now has been formal-
ly accepted by 30 of the 46 member states of the
Organization of African Unity. Most, if not all of
the rest, are likely to fall into line before long;
even Zairian President Mobutu, Neto's long-time
enemy, is apparently trying to work out a modus
vivendi with the Popular Movement. In any event,
the Movement's new diplomatic gains ended any
doubts about whether it would be seated as the
government of Angola at the OAU ministerial
meeting that isapparently still scheduled for later
this month.
Uganda's action gave the Movement a special
boost, inasmuch as President Amin had played an
important role in his capacity as OAU chairman in
the effort to check the Neto group's drive for
acceptance as the sole government of Angola. In
a telegram to Neto, Amin explained that Uganda
was extending recognition because the Popular
Movement had been endorsed by a majority of
OAU states and thus was "automatically entitled"
to full OAU membership.
With the deterioration of its military and
political position, the National Union has stepped
up its efforts to get talks going with Neto on a
possible coalition government for Angola. An ap-
proach last month to Kenya to act as go-between
got nowhere; Nairobi recently informed Savimbi
that Neto was unresponsive to its overtures.
The Union is now looking to Nigeria, which it
approached through the British. Although Nigeria
recognized the Popular Movement regime last
November and has given it strong diplomatic sup-
port, Lagos has continued to favor some kind of
accommodation between the warring Angolan
groups. According to the British high com-
missioner in Lagos, the Nigerians agreed last week
to relay to Neto a message from Savimbi propos-
ing discussions in Lusaka, Zambia. There are some
signs that the Nigerians are becoming increasingly
anxious to end the Soviet and Cuban presence in
Angola and consider a reconciliation between the
Popular Movement and the National Union as a
necessary precondition. Neto, however, is ap-
parently still adamantly resisting all efforts to
move him toward any coalition arrangement,
even one limited to the National Union as a
decided junior partner.
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USSR-ANGOLA: MORE TOUGH TALK
Pravda this week published a long,
authoritative article on Angola designed in part to
refute US criticism of Moscow's role in the former
Portuguese territory.
The article-signed "Observer" to indicate
top-level Kremlin endorsement-is Moscow's
most complete and authoritative statement on
Angola to date. Its tone was confident on Angola
itself, assertive regarding the rest of Africa, and
almost pugnacious in its rejection of the notion
that the USSR has anything to apologize for in its
Angola policy. It lashed out at Secretary
Kissinger's recent speech in San Francisco, saying
the Secretary was "obviously out of tune with the
facts" and was attempting to "whitewash"
long-standing US "overt and covert interference"
in Angola. "Observer" emphasized that detente
does not signify "freedom of action for
aggressors."
Moscow has displayed considerable sensitivi-
ty to the Secretary's West Coast remarks and to his
testimony on Angola before the Senate, but this is
the first time that an authoritative Soviet rebuttal
has appeared. Earlier articles had directly criticiz-
ed both President Ford and Secretary Kissinger for
allegedly "distorting" the Soviet and Cuban role
in Angola, but they were careful to balance these
barbs with positive comments on the ac-
complishments of detente. Pravda did not men-
tion Cuban aid for the Popular Movement nor
Soviet naval activity off West Africa, but it did, for
the first time, admit openly that the USSR and its
allies gave Angola "weapons."
Perhaps by way of additional justification, the
"Observer" article went further than the Soviets
had gone heretofore in describing the
"imperialist opponents" arrayed against the Luan-
da regime. Thus, it stated specifically that the
mercenaries who have fought against the Popular
Movement were recruited in the US, West Ger-
many, the UK, and other Western countries in a
"well-organized way."
"Observer" also took a swipe at alleged
NATO designs on Angola, a theme that has
appeared with increasing frequency in recent
Soviet media commentary. "It is no secret," the
article noted, that Western "military, strategic,
and economic interests" play a considerable role
in "neo-colonialist and racist" desires for a
"bastion" in southern Africa to confront all the
"progressive countries" on the continent.
"Observer's" assertion that South African forces
have no intention of withdrawing from Angola
raised by implication the possibility that Soviet
assistance and that of the Cubans will continue.
This may also be the underlying meaning behind
the assertion that the Angolan people should be
"ensured conditions to complete the liberation."
Revolutionary groups elsewhere in sub-
Saharan Africa were offered even stronger en-
couragement than was the case in an Izvestia
"Observer" article on Angola late last month.
Pravda emphasized that the consolidation of the
Popular Movement's power in Angola will repre-
sent a "powerful stimulus" in mounting the
liberation struggle against Namibia, Rhodesia,
and South Africa itself.
At the same time, however, Pravda-like the
earlier Izvestia article-attempted to balance its
hard-hitting prose with a conciliatory gesture.
While making no bones about Soviet "moral,
political, diplomatic, and other" assistance to the
People's Republic of Angola as the "legitimate"
government, "Observer" pointed out that
Moscow by no means considers the "military
way" the only possibility of settling the Angolan
question.
The "Observer" article devoted a paragraph
to a quote from "President" Neto, saying that he
and the Angolan people appreciate all that their
"friends" have done. The purpose of this curious
testimonial may be to tell the Soviet audience that
the Soviets have reason to believe that the
Popular Movement will not prove to be a bunch
of ingrates.
"Observer" took special note of China's sup-
port for the forces opposing the Popular Move-
ment. The treatment may have been in reaction to
a recent attack in the People's Daily on Soviet
policy in Angola.
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LEBANON: INCHING AHEAD
Lebanese President Franjiyah made his
long-awaited trip to Damascus last weekend. His
talks with Syrian President Asad resulted in a
public reaffirmation by Damascus of its guarantee
that the Palestinians will respect past agreements
with the Lebanese government. No an-
nouncements were made concerning the political
settlement for Lebanon that Syria has been seek-
ing, apparently because Lebanese politicians,
while agreeing on the basics of a reform package,
continue to argue over specific provisions.
Damascus will probably attempt to honor its
pledge to control the fedayeen by continuing to
use units of the Syrian-controlled Palestine
Liberation Army to patrol areas of Lebanon where
the fedayeen and Christian militias most often
clash. In addition, Liberation Army forces in
Beirut will probably try to restrict armed fedayeen
to the refugee camps. These actions will help to
preserve the cease-fire and facilitate political
negotiations at no long-term cost to the fedayeen
military position in Lebanon.
A Lebanese newspaper reported last
weekend that Franjiyah and Asad also agreed on a
comprehensive political settlement for Lebanon
that will be made public by Beirut after it is ap-
proved by the Lebanese cabinet. The accord
reportedly provides for:
? A revised and written Lebanese
national charter to replace the existing un-
written national covenant.
? The formation of a new cabinet un-
der Prime Minister Karami.
? The scheduled withdrawal of
Palestine Liberation Army troops from
Lebanon.
The report remains unconfirmed. Syrian
Foreign Minister Khaddam did tell newsmen late
last week, however, that Asad and Franjiyah, even
before their meeting in Damascus, had reached
agreement on a political settlement covering "all
aspects" of the Lebanese dispute. An announce-
ment may be made in Beirut following a special
cabinet meeting scheduled for February 14.
Franjiyah is using the agreement on the
Palestinian question in a final attempt to elicit the
backing of all Christian factions for a general
political settlement. Leaders of some ultra-
conservative Maronite groups are still trying to
qualify their agreement to basic elements of the
reform package by demanding a more detailed
agreement that would better protect the
Christians' political prerogatives.
1
FRANCE-SOMALIA: HEATING UP
Tensions increased markedly in the volatile
Horn of Africa last week as a result of a border
clash between Somali soldiers and French troops
stationed in France's Territory of the Afars and
Issas. Both sides reinforced their garrisons, and
neighboring Ethiopia placed its armed forces on
alert. A wider conflict appears unlikely at this
time, but more trouble seems certain as Paris
proceeds with plans, which Somalia opposes, for
decolonizing the territory.
On February 3, members of a Somali-backed
guerrilla group, the Front for the Liberation of the
Somali Coast, hijacked a bus carrying French
school children in Djibouti, the capital of the
French territory. French troops halted the bus
near the Somali border and, on the following day,
stormed the vehicle, killing the terrorists. During
the incident, the troops exchanged fire with a
Somali force drawn up to the border. France
claims the Somalis fired first; Mogadiscio charges
that the French attacked a Somali border town
with tanks, armored cars, and artillery.
All French forces in the territory were placed
on alert, and Paris flew in about 1,000 riot police.
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The French also arrested the leader of the
territory's legal opposition party, which has close
ties to Somalia and the terrorist group.
Unrest had been increasing in the territory
for several months. Opponents of the pro-French
colonial government have staged several
demonstrations, and French authorities have
been searching homes for arms caches and ex-
pelling ethnic Somalis suspected of being illegal
residents. The expulsions, in particular, have
angered President Siad's government in
Mogadiscio, which claims that France is forcing
out legal residents who might vote for pro-Somali
candidates in any elections to be held as part of
the decolonization process.
Since the clash, the border has remained
quiet, but Somalia has pressed a vigorous
propaganda and diplomatic campaign aimed
against France and Ethiopia, which supports Paris'
plans for the territory. The campaign apparently is
intended in part to deflect attention from
Mogadiscio's ties with the terrorists and to further
Somalia's efforts to gain a voice in negotiations on
decolonizing the territory. Mogadiscio officially
supports "unconditional" independence, but its
long-range ambition is to annex the
territory-and parts of Ethiopia and Kenya as well.
President Siad is particularly opposed to France's
plans to transfer power to a long-time Somali foe
and to keep French troops in the territory after in-
dependence.
On February 5, Mogadiscio asked for a UN
Security Council meeting over the incident, but
subsequently indicated that it would not press for
a meeting until early next week. There are signs
that some African delegates, concerned that a
debate would reveal more disunity in their ranks,
were attempting to get Somalia to withdraw its
Siad is claiming publicly that France and "cer-
tain colonialist forces" have plans to invade
Somalia and has sought political support from
fellow members of the Arab League. Siad will
probably step up pressure against the French by
supporting a campaign of subversion and
France has pledged to guarantee the integrity
and security of an independent Afar-Issa state by
maintaining a military presence, but Paris is
probably unwilling to act as sole peacekeeper in
the region. More terrorist acts against French
citizens could cause France to reconsider its
pledge.
MOROCCO-ALGERIA: NO SOLUTION YET
Arab efforts last week to resolve the dispute
between Morocco and Algeria over Spanish
Sahara made little progress, although Egyptian
and Saudi mediators did succeed in arranging at
25X1
25X1
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least a partial withdrawal of Algerian forces from
the disputed territory. The Moroccans have
resumed a military sweep against remaining
strongholds of the Algerian-backed Polisario
guerrillas in the northeastern Sahara. Algiers is
continuing to provide the Polisario Front with es-
sential material support for its insurgency, while
pushing on the diplomatic level for a referendum
on self-determination.
Egyptian Vice President Mubarak returned to
Cairo on February 5, having failed to-get Morocco
and Algeria to compromise on the substance of
their dispute. Rabat continues to insist on
Algerian recognition of Moroccan sovereignty
over the territory before Morocco will accept
Egypt's proposal for a meeting of foreign
ministers in Cairo. Morocco's position was spelled
out by Minister of State for Information Benhima
in a press conference on February 10. Rabat's
decision to press on with its military sweep in
Spanish Sahara while Egyptian mediation efforts
were still going on contributed to Mubarak's
failure.
Algeria, for its part, refuses to drop its de-
mand for a "free and genuine" referendum on
self-determination for the people of Spanish
Sahara. The Boumediene government reiterated
its position at length on February 6 in a memoran-
dum to UN Secretary General Waldheim. In addi-
tion to again condemning the tripartite agree-
ment signed last November by Madrid, Rabat,
and Nouakchott turning over control of the
Sahara to the Moroccans and Mauritanians, the
memorandum maintained that Spain is still ac-
countable to the UN as the legitimate ad-
ministering power of a non-self-governing
territory. It also characterized the Moroc-
can-Mauritanian take-over of the territory as a
blatant act of aggression affecting the peace and
stability of the region.
The memorandum may be a prelude to an
Algerian appeal to the Security Council. Given
the inconclusive outcome of the debate in the
General Assembly last December-two
resolutions were passed, one of which supported
the Moroccan position and the other the
Algerian-a request that the Council take up the
Sahara issue as a threat to international security is
the only move left to the Algerians at the UN.
Waldheim's personal envoy arrived in the
Sahara on February 7 after two days of con-
sultations in Madrid. He is expected to return
home later this week without visiting Morocco,
Mauritania, or Algeria. The envoy-and the
Moroccans, who insist that the question of the
future of the disputed territory is settled-are
carefully portraying the mission as limited to
fact-finding. The Moroccans are also using the oc-
casion to play up their claim that Saharans have
already been consulted through the territorial
assembly, which Rabat says decisively endorsed
the tripartite accord. The Algerians are
characterizing the envoy's mission as evidence
that the "Sahara file remains open" at the UN.
Within the territory, Moroccan military
operations in the northeast have proceeded
without incident. The Moroccans occupied
Tifariti on February 4 and Bir Lehlu four days later,
after Egyptian and Saudi mediators arranged a
deal with Algeria to withdraw any forces it had in
the two towns. By midweek there were uncon-
firmed reports that Moroccan troops had also oc-
cupied Mahbes, some 30 miles from the Algerian
border. Loss of Mahbes would deprive the
Polisario Front of its last stronghold in the
northeastern part of the territory.
Despite Algeria's decision not to confront
Moroccan forces occupying these Polisario
strongholds, there are no indications that Algiers
is changing its strategy of supporting guerrilla
harassment of Moroccan and Mauritanian forces,
which have now occupied nearly all of the towns
and outposts in the Sahara. So long as Algiers con-
tinues to provide weapons, training, and supplies,
Polisario guerrillas can continue indefinitely their
hit-and-run and sabotage attacks. They will
probably focus their efforts in those areas where
opposition is weak and where they can operate
with relative freedom, such as the part of the
Sahara under Mauritania's control, or even
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ITALY: RESPITE BUT NO SOLUTION
Aldo Moro's search for a new government
ended this week when his Christian Democratic
Party reluctantly agreed to form a one-party
minority administration on terms that make it the
weakest Italian government in years. The govern-
ment was sworn in yesterday and faces a con-
fidence vote in parliament next week. Moro's
cabinet will probably last only a couple of
months-just long enough to take some
emergency economic measures and to permit the
Christian Democrats and Socialists to sort out
political options at party congresses in March.
The Christian Democrats' reluctance to form
a cabinet on their own-a traditional way of let-
ting the dust settle when other solutions prove
elusive-stems from Moro's failure to get more
than a limited offer of cooperation from the other
center-left parties. Only the small Social
Democratic Party will vote with the Christian
Democrats in parliament. The Socialists and
Republicans, traditionally at loggerheads on
economic policy, have agreed to abstain in a
parliamentary confidence vote, which will permit
a government to be installed. The two parties
reserved the right, however, to oppose portions
of Moro's economic program.
Moro had considerable difficulty convincing
the Christian Democrats to go ahead under these
circumstances. Conservatives, such as former par-
ty chief Fanfani, argued that such a government
would quickly find itself in trouble unless Moro
could persuade the Socialists and Republicans to
provide actual support in parliament. Neither par-
ty budged, although Socialist chief De Martino's
public promise of "maximum good will" im-
proved the atmosphere a bit. That, coupled with
President Leone's statement of support for Moro
early this week, helped Moro and his major ally,
Christian Democratic leader Zaccagnini, to cir-
cumvent opposition in the party.
None of the governing parties is satisfied with
the results of the lengthy maneuvering, least of all
the Socialists. They failed to achieve the objec-
tives they sought in bringing down Moro's
previous government early last month, which
Aldo Moro dim 0 C T
were a larger role for the Socialists in a new
government and more open consultations with
the Communists.
The Communists are probably the only
gainers. They will point to the continuing political
deadlock to bolster their argument that the Com-
munist Party must ultimately be brought into the
government. Meanwhile, the Communists retain
the option to criticize in public, while working
behind the scenes in parliament to put their
stamp on economic and other legislation propos-
ed by the new government.
The compromise economic program that
enabled Moro to put together his fragile majority
judiciously combines spending austerity and a
credit squeeze-measures sought by the conser-
vative Republicans-with job-saving provisions
desired by the Socialists and the labor unions.
The more important elements of the
emergency package include:
? Holding down incomes by a partial
wage freeze for the top 10 percent of white
collar workers and restraint of blue collar
wage demands.
? Increasing revenues by. imposing an
excess profits tax and tightening up on
collection, as well as standby authority to
collect $2.6 billion in new indirect taxes.
? Limiting spending by monitoring
state expenditures to reduce the soaring
deficit.
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? Creating jobs by establishing an ap-
prenticeship program to employ some 50,-
000 young people.
The program also reaffirms-without going
into potentially contentious details-the
government's interest in longer range structural
reforms to alleviate Italy's chronic inflation and
balance-of-payments problems. These measures
include investing $26 billion over five years in the
industrial sector, restructuring the industrial sec-
tor, and revising the Southern Development
Fund.
While the fiscal and incomes policy measures
are relatively weak, the government also im-
plemented a series of helpful monetary and
foreign exchange policies. These flanking actions,
including increased reserve requirements and a
higher discount rate, are designed to cut capital
outflows and reduce excess liquidity. The lira,
which the government stopped supporting three
weeks ago, gained strength from its low point last
week, but ebbed slightly in recent days due large-
ly to technical corrections.
The proposed program, still to be approved
by parliament and subject to specific changes,
should restore a modicum of confidence in the
economy. The main thrust of its restrictive
policies would be to dampen inflationary
pressures and thus promote a more balanced
recovery of the economy.
FRANCE: CRUCIAL CONGRESS
The 22nd French Communist Party congress
ended on February 8, after unanimously suppor-
ting Secretary General Georges Marchais' an-
nounced intention to move the party away from
Soviet-style orthodoxy. The new look Marchais
hopes to give the party was also reflected in a
resolution to remove the term "dictatorship of
the proletariat" from party statutes.
Although there was support for this doctrinal
change, debate over its implications has not end-
ed within the party, and Marchais must be able to
enforce party unity in order to follow through
with his policy revisions. Rank-and-file rebellion
was responsible, for example, for the removal
from the congress' agenda of at least one topic in-
troduced by the party leaders at preparatory
meetings. References to the "immorality and sex-
uality of the masses" distressed many members
and resulted in a barrage of letters to the party
newspaper !'Humanize complaining that this was
not a topic suitable for discussion at the congress.
Marchais' call at the congress for a "union of
the French people" based on issue-by-issue
agreements among "like-minded progressive
forces" seems designed to outflank the Socialists
on the right and may encourage some orthodox
Gaullist deputies to join the Communists in op-
posing some government proposals. The issue of
a popularly elected European Parliament, which is
supported by the government and most of the
Socialists, is opposed by the Communists and the
orthodox Gaullists. At least one orthodox Gaullist
has expressed a desire to cooperate with the
Communists in a campaign on this issue. Further
Communist appeals to those Gaullists could make
it difficult for Prime Minister Jacques Chirac to
maintain unity in his party.
The Socialists see the new Communist
strategy as a political ploy designed to offset
Socialist electoral gains, rather than a real deci-
sion to reform. Socialist fears have been fed by a
recent poll which indicates that, in one section of
the country at least, there has been a 4-percent
increase in Communist popularity during the last
month.
Although Marchais emphasized his desire to
cooperate with the Soviets in the "joint struggle
against imperialism," he attacked some of the
most sensitive points in Soviet doctrine. The
French move toward greater liberalism, similar to
that of the Italian party, creates the appearance of
a trend that the Soviets find profoundly distur-
bing. The Soviets undoubtedly fear that Marchais'
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moves will further reduce Moscow's influence in
the world communist movement and provide
renewed temptation for the East Europeans to
take a more independent line. The timing of
Marchais' "declaration of independence" is par-
ticularly upsetting to the Soviet leaders, who have
their own party congress coming up and thus can
hardly ignore the French challenge.
The Soviet rebuttal began while the French
congress was still in progress. Speaking at a rally in
a Paris suburb, Politburo member Kirilenko, who
led the Soviet delegation to the congress, defend-
ed the Soviet way of life as a valid model, as op-
posed to Marchais' "socialism with French
colors." So far- the Soviet media have tried, by
selective and incomplete coverage, to conceal the
magnitude of the French break with orthodoxy,
but the idea that something is amiss cannot be
permanently hidden.
The Soviets appear to enjoy considerable
grass-roots support in the French party, and there
are many issues on which the French and Soviet
parties agree. The Soviets will probably continue
their dispute with the French party, but will not
break off relations entirely. If Marchais fails to un-
ite the party to carry out his new policies, the
Soviets may decide to exploit the disarray to try to
bring the French party back to the orthodox fold.
Soviet Politburo member Kirilenko (1) greeted on his arrival in Paris to attend French Communist Party congress
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USSR: 25TH PARTY CONGRESS
General Secretary Brezhnev is expected to
dominate the 25th Soviet Communist Party
Congress, which opens on February 24 in
Moscow, as he did the two previous congresses.
Much of the opening session will be taken up
with administrative affairs. President Podgorny, or
someone of similar stature, will preside over the
opening ceremonies and the election of the con-
gress' governing bodies-the Presidium, the
Secretariat, the Editorial Commission, and the
Credentials Commission. Candidates for positions
on these bodies are elected quickly and un-
animously.
After the election Brezhnev will deliver the
Central Committee's accountability report. At the
24th congress, Brezhnev's speech was six hours
long and was televised live. The report of the
chairman of the Auditing Commission, G. F.
Sizov, will follow Brezhnev's.
USSR Gosplan chairmen. Kosygin's speech will
conclude the discussion and be followed by the
election of members of the party's ruling bodies.
This election will take place at an afternoon
session the day before the close of the congress.
The session is open only to voting delegates and
those with consultative votes, some 5,000 in all.
Once these delegates have elected a new Central
Committee, its members meet in plenary session
to elect the new Politburo and Secretariat. The
stability that has marked pre-congress
preparations suggests that there will be no major
shake-up in the Central Committee or the Polit-
buro. A small increase in the membership of the
Central Committee is possible; this has been the
practice at recent CPSU congresses. One or two
new faces may appear in the party secretariat.
At the final session of the congress, Brezhnev
will probably preside, and the results of the
For the next several days, the first secretaries
of republics and of other important party
organizations will dominate discussion of these
reports, with first secretary of the Moscow city
party committee Grishin heading the list. If tradi-
tion is followed, he will be followed by the first
secretaries from the Ukraine, Leningrad, and
Kazakhstan. In addition to important party
figures, some representatives of the intelligentsia
and simple workers may be allowed to take part in
the discussion. After six days of turgid debate, full
of encomiums for Brezhnev, the congress will
adopt a decree on Brezhnev's report and approve
the Auditing Commission's report. Full approval
of the General Secretary's report is normally
deferred until the last day of the congress.
When the discussion of Brezhnev's report is
concluded, Chairman of the Council of Ministers
Kosygin will present the draft directives for the
Five Year Plan. Government officials will
dominate discussion of Kosygin's speech. The
chairman of the Ukrainian Council of Ministers
has in the past initiated the debate, and he will
probably be so honored again. Other speakers
will include the chairmen from Kazakhstan,
Belorussia, and Uzbekistan, and the RSFSR and
NTEWORTHY EVENTS AT RECENT
SOVIET PARTY CONGRESSES
CONGRESS , DATE COMMENT
19th Oct 5 - 14, 1952 Stalin's last; name of party
changed to Communist
Party of the Soviet Union;
laid groundwork for a gen-
erational change in the top
leadership.
4 - 26, 1956 Launched K hrushchev`s
de-Stalinization, campaign.
23rd Mar 29 -
tion; Stalin's.-body re-
moygd from mausoleum in
Red Square; approved vi-
sion&ry party program.
Consolidated position of
Apt 8, 1966 the ,group that ousted
Khrushchev; swept Stalin
issue-under the rug.
24th Mar 30 Promised continuity; dull
Apr 9, 1971 but Y businesslikg atmos-
phere
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lw~
previous day's election will be officially an-
nounced. The order in which Brezhnev reads the
names of the newly elected party officials will give
some indication of the Politburo's new pecking
order. This is one of the few occasions under
current practice when names are not presented in
alphabetical order.
SPAIN: GOVERNMENT INITIATIVE
The new Spanish government has acted to
implement two of Prime Minister Arias' promises
to liberalize the political system, but its efforts fall
short of opposition demands and the left con-
tinues to press for faster change.
Last week the cabinet repealed some of the
harshest portions of Franco's 1975 anti-terrorism
law-a major demand of the leftist op-
position-but kept enough controversial features
to make the changes appear largely cosmetic.
Members of the two major terrorist groups in
Spain, the Basque Fatherland and Liberty and the
radical extremist Antifascist and Patriotic
Revolutionary Front, will apparently continue to
be tried by military tribunals that severely restrict
legal rights. Furthermore, the right of habeas cor-
pus will remain suspended throughout Spain, and
police will retain sweeping powers of search
without warrant.
On the same day, the cabinet also approved a
draft law widening the right of assembly. It
provides that police authorization will no longer
be required for indoor meetings of more than 19
people, although police will still have to be
notified in advance. Communists, terrorists, and
separatists are excluded, and permission is still
required for outdoor meetings and
demonstrations. The draft law will be an impor-
tant test of the conservative parliament's
willingness to go along with Arias' cautious
reforms.
Arias has been widely criticized by the far left
and even by members of the establishment for
the vagueness of his promises and his un-
willingness to commit the government to a
specific timetable. Defenders of the government
maintain that caution is necessary in the face of
strong opposition from the entrenched ultra-right
"bunker." The cabinet decisions last week were
apparently intended as an earnest of the
government's good intentions.
Prominent ministers, in an obvious effort to
flesh out the disappointingly bare bones of Arias'
policy speech of January 28, have talked of a con-
stitutional referendum this summer, local elec-
tions in November, and parliamentary elections
by universal suffrage in the first half of 1977.
Justice Minister Garrigues has also said that the
government is already preparing changes to ease
the penal code dealing with illegal association
and propaganda-a move that could facilitate
release of more political prisoners.
The opposition, meanwhile, continues to
press for more. Their impatience is most visible in
the troubled Basque and Catalonian regions
where demands for significant autonomy have
been largely ignored. Demonstrators in Barcelona
defied massive police precautions on February 1
and 8 and managed some of the biggest shows of
opposition to the government since Franco's
death. Organized by the illegal Assembly of
Catalonia-a Communist-manipulated amalgam
of regional groups-the demonstration focused
on demands for more autonomy for Catalonia
and amnesty for all political prisoners.
The assassination of a Basque mayor this
week and the killing of another Basque-ap-
parently because he was mistaken for the mayor
of his town-appears to be the work of a splinter
commando group. The Basque Fatherland and
Liberty, which had apparently slackened off in
order to regroup after harsh government repres-
sion last year, may now try to prove that it can
outdo the rival group, initiating a renewed cycle
of terrorism in the Basque provinces. The splinter
group evidently hopes that continued terrorist
acts will provoke more official repression and
prevent the government from instituting limited
regional autonomy in place of the separate nation
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ICELAND: TENSIONS INCREASE
The cod war warmed up again last week as
Britain ordered its warships back into Iceland's
disputed 200-mile fishing zone and Reykjavik
renewed its threat to break relations with London.
The British move on February 5 came after an
Icelandic patrol boat cut the trawls of a British
fishing boat. Foreign Secretary Callaghan had
warned earlier that further Icelandic harassment
would automatically trigger the return of the
frigates. Prior to his decision to send back the
navy, Callaghan outlined to NATO ambassadors
the British position in the fishing dispute and ask-
ed for support. He said the UK had bent over
backwards in search of an agreement, but had
met only with intransigence.
The Icelandic cabinet's rejection of the draft
fishing agreement worked out by Prime Minister
Wilson and Icelandic Prime Minister Hallgrimsson
further angered the British. Reykjavik contended
that the British request for 28 percent of the total
annual catch off Iceland was unacceptable. The
British proposal also stipulated that the UK would
get a minimum of 65,000 tons of cod this year and
an overall catch of 85,000 tons. Reykjavik wants to
limit the overall catch to 65,000 tons.
Despite its rejection of the London proposals,
the Icelandic cabinet decided on February 6 not
to break relations with London at this time.
Hallgrimsson was apparently able to convince his
cabinet to postpone its decision until NATO
Secretary General Luns had another chance to
mediate the dispute. The cabinet was also im-
pressed by expressions of concern voiced at two
special sessions of the North Atlantic Council.
Luns' chances for success are slim. Although
the British have said they will cooperate fully with
him, they are privately pessimistic over his
chances. London is looking for a face-saving way
out of the current impasse, but feels it has already
gone as far as it can without any sign of reciprocal
flexibility from Reykjavik.
Hallgrimsson's only hope of easing tensions is
to revive the Icelandic proposal for a three-month
agreement, which was dropped when London
sent its frigates back to the disputed zone. The
Prime Minister believes he can sell a short-term
agreement to his government's coalition partner,
the Progressive Party, if the frigates leave the area.
He still must convince Progressive Party leader
Johannesson, however, `who is reluctant to ap-
prove such an agreem nt now that British
warships have returned.
SECRET
NATO Secretary General Luns
OCu
25X1
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NATO: ARMS COOPERATION
Last week's meeting in Rome of the 10
members of NATO's Eurogroup and France was a
successful first step toward greater European
defense cooperation. The goals of the new
"Independent European Program Group" are to
increase arms industry cooperation-seen as an
economic, technical,.-and political necessity-to
strengthen the "European factor" within the
Alliance, and to ensure that Western r.urope
maintains a modern industrial and technological
base. Unless the group moves fairly rapidly
toward developing specific projects, however,
there will be pressure, particularly from Britain
and Germany, to move the standardization effort
back to a NATO forum.
The group convened outside the Alliance
framework largely in order to accommodate
French objections to association with NATO's in-
tegrated military command. Central to the
group's success thus far has been a new
willingness by France to cooperate with its allies.
Participants have indicated that the French show-
ed an encouraging seriousness and flexibility dur-
ing the discussions. As a result, the group was able
to agree easily on a collaborative work program
and on the importance of maintaining the
trans-Atlantic link-commitments that in the past
might have been expected to elicit French reser-
vations about multilateral forums and military
collaboration within the Alliance.
France's cooperativeness is in part due to
Paris' realization that, despite French prominence
in arms production, the other Europeans could
become impatient enough to move ahead
without it in the Eurogroup. The French are also
apparently increasingly confident of their ability
to hold their own among the Europeans and,
backed by them, to compete with the US in Euro-
pean arms sales.
Paris has measured well the eagerness of its
European partners to have France participate in
the arms effort. The willingness of the allies, for
their part, to meet with the French outside the
Alliance framework is attributable not only to
long-run considerations of assuring a European
role in arms production, but also to their percep-
tion of improved French-US relations and US in-
terest in getting on with improving Alliance
military efficiency.
Within the new European effort, France is
committed to preserving "Alliance cohesion,"
but the French can be expected to continue to be
more assertive of the "European vocation" than
the others. Despite its advocacy of closer Euro-
pean cooperation in the arms field, France will be
wary of submitting ultimately to guidelines that
could restrict advantageous bilateral deals with
the US. Paris apparently views such deals as a
vehicle for broadening its access to American
high technology.
The process incorporated by the Rome
meeting has, in any case, seemed to reinforce the
European awareness that defense cooperation is
an essential part of the movement toward political
unity. Belgian Prime Minister Tindemans' recent
report on the future of "European Union"
recommends EC involvement in defense matters
and the establishment of an arms procurement
organization. This is still a politically difficult step
for France, as well as some of its partners, to take,
and the Program Group could in fact perform
much the same function without raising as much
debate.
Arms officials from "The 11" will meet in six
weeks to present their initial findings on possible
programs of common interest and on how work
might be shared among European firms. A
meeting at the political level will be held in June;
by that time there should be significant evidence
by which to gauge the success of last week's
agreements in surmounting traditional barriers to
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BALKAN COOPERATION: A STEP FORWARD
Middle-level officials from all the Balkan
countries except Albania made modest progress
toward economic and technical cooperation at
their recent 11-day conference. They also kept
the door ajar for similar gatherings in the future.
The participants, who met in Athens from
January 26 to February 5, referred 154 non-
political proposals to their governments for con-
sideration. These propositions are in the fields of
agriculture, commerce, energy, transport,
telecommunications, and environment. The com-
munique summarizing the discussions makes
clear that a second conference will depend on
whether the participating governments decide
that multilateral cooperation is "useful and ap-
propriate." Yugoslav press accounts report that
"most" participants believe that a second session
will be held soon.
The conference was inspired by Greek Prime
Minister Caramanlis, who viewed it as an oppor-
tunity to apply on the regional level the principles
of detente adopted at Helsinki last summer. He
also believes it would help secure his country's
northern flank against possible adventurist ac-
tions by Turkey. Although most delegates
evidently tried to avoid politics, there were some
reports that Bulgaria, considered a Soviet sur-
rogate by the other participants, clashed with
Romania when Bucharest advocated designating
the Balkans as a "zone of peace."
Other Warsaw Pact members-possibly at
Moscow's behest-may try to attend the next
round of talks. An Italian diplomat recently said
that the Hungarians had tried unsuccessfully to
participate in the Athens meeting. Moreover, a
Greek Foreign Ministry official asserts that the
Bulgarians, on the eve of the Athens conference,
resurrected an earlier suggestion that the
Hungarians, Czechoslovaks, and Poles attend the
initial meeting.
Belgrade and Bucharest might be willing to
support Hungarian participation in a follow-on
session, but they would almost certainly view ef-
forts by Prague and Warsaw to gain admission as a
Soviet attempt to pack the meeting. Meanwhile,
journalists in Athens say that the Greeks will brief
the Albanians on the first conference and then
are likely again to propose that Tirana send a
delegation to the second round of talks.
ALBANIA: STATE OF PARANOIA
After a series of top-level purges of the party
and government over the past year, Albanian par-
ty chief Hoxha is now making a frantic effort to
strengthen his country's air and sea defenses.
The Italian ambassador asserts that the nor-
mally secretive Albanians are hastily building
bomb shelters and antiaircraft bunkers around
the capital, and are making no effort to
camouflage their activities, They have even re-
quested embassies to build bomb shelters in their
compounds. The French ambassador confirms
these reports and adds that Albania is in the midst
of a "frenzied" attempt to build a chain of
bunkers along the Adriatic coast. Both diplomats
believe that these efforts reflect genuine concern
for the nation's security.
The Italian comments that the country's in-
ternal situation has deteriorated so much that
Albania resembles a concentration camp. Or-
dinary citizens fear even to exchange greetings
with foreigners.
Tirana's anxiety reflects the leadership's in-
creased sense of insecurity and isolation. The ill
health of Hoxha and of Premier Shehu has
probably led the leadership to resort to fear tac-
tics-such as the purges-to preserve its position.
In addition, Tirana's fear of Moscow has increased
sharply since 1974, when pro-Soviet cominfor-
mists were discovered in neighboring Yugoslavia.
The xenophobic Albanians continue to reject
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CY s
Soviet overtures for closer bilateral ties. China's
relative indifference to Albania's current
economic plight may have contributed to the
Hoxha regime's sense of isolation.
Meanwhile, Hoxha seems intent on projec-
ting an image of unity within the leadership. In
mid-January, the entire hierarchy turned out at
the Chinese embassy to offer condolences on the
death of Chou En-Iai. Since then, there have been
no similar appearances by the party elite, but such
absences from public view-particularly by Hox-
ha-are not unusual. Some Western diplomats in
Tirana, however, doubt that Hoxha will be on the
scene much longer.
CHINA: AN "ACTING" PREMIER
Chou En-lai's carefully planned succession
arrangements, which began with the first signs of
his illness in 1972, went awry within weeks after
his death. On February 7, Politburo member Hua
Kuo-feng was publicly listed as acting premier,
raising questions about the status of Chou's
hand-picked successor, Teng Hsiao-ping, who
had been rescued from the obscurity of a purge
victim of the Cultural Revolution and groomed
for several years to succeed Chou. Teng had been
de facto premier for over a year.
Teng's return to power had had the full en-
dorsement of Chairman Mao Tse-tung, but the
party's left wing, which had been responsible for
Teng's purge a decade ago, has never accepted
him. Leftists launched an indirect attack on Teng
in December, criticizing proposed changes in the
educational policies adopted during the Cultural
Revolution. A more pointed attack on him in
People's Daily on February 6 indicated his ap-
pointment was in trouble. The tone of the attack
was reminiscent of leftist assaults on Teng a
decade ago. The propaganda onslaught strongly
suggests the party's left wing retains something of
a veto over major appointments-at least when
such controversial persons as Teng are involved.
The possibility that leftist agitation over the
education issue, agitation prompted in part by
Teng's growing power, might lead to widespread
disruption may have persuaded Mao to abandon
Teng in the interests of stability. The Chairman
may never have been fully comfortable with
Teng, with whom he had major differences in the
early 1960s. His previous support of Teng,
however, leaves the Chairman open to charges
that he has backed yet another "wrong horse"
should Teng not recover politically.
There is no evidence that Teng has again
been purged, but the party's left wing has
mounted a vicious and only thinly veiled attack
on him. Hua Kuo-feng's designation as "acting"
premier-a point he emphasized to a foreign am-
bassador-suggests the succession to Chou En-lai
is not fully settled, leaving an outside possibility
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that Teng could eventually get the job, though
the chances appear quite slim.
Teng's actions over the past year have not
helped his cause and may well have served to an-
tagonize groups other than the left. As army chief
of staff, for example, he has moved close
associates into key military posts, possibly
alienating some powerful regional military com-
manders. He has also rehabilitated several
old-line party officials, which certainly has an-
tagonized the left. The climax may have come last
autumn, when directives announced the return of
several cultural officials who were the initial vic-
tims of the Cultural Revolution and whose
rehabilitation was a blow to the left.
Despite Mao's endorsement of their
rehabilitation, these men never appeared public-
ly. In December, a new directive announced that
their former boss, the party leader in charge of
culture, had been exiled from Peking. This move
suggested the left was attempting to redress the
balance.
Although the left will take comfort in the
current setback to Teng, the appointment of Hua
is far from a leftist "victory." Hua was called to
Peking after the fall of defense minister Lin
Piao-a time when the left was reeling-and lef-
tists attacked him by name in 1974. He is obviously
a compromise candidate. He rose to power dur-
ing the Cultural Revolution, making him more
acceptable to the left than Teng, but he was not
associated with the excesses of that period, which
makes him acceptable to the more conservative
party members. His position as a
middle-of-the-roader was presumably the
primary recommendation for his appointment.
As security minister, the party leader in
charge of agriculture, and former province chief,
Hua has some experience in domestic affairs. He
has been running agriculture for three years and
is closely associated with China's current effort to
mechanize agriculture as part of a long-term
economic modernization program, one with
which Teng is also associated. He is not likely to
depart from current domestic policies, although
the proposed changes in educational policy are
presumably in abeyance.
Hua lacks experience in foreign affairs and is
unlikely to initiate any major changes in China's
foreign policy, especially while the succession
issue remains in doubt. Foreign policy, however,
may have played a secondary role in the struggle
That led to his appointment.
China's party members will probably be un-
settled by Hua's unexpected appointment; most
of them expected Teng to succeed Chou without
trouble. This new evidence of instability and divi-
sion in the party leadership will have an adverse
affect on morale. Moreover, the fact that Chou's
careful preparations for succession to his office so
quickly fell apart suggests that Mao's
arrangements for his own succession are likely to
be equally fragile.
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JAPAN
Japanese firms are in a strong position to take
advantage of a sustained US economic upturn. As
a result, we expect Japan's trade surplus with the
US to reach $1.7 billion this year, compared to a
$1.1-billion surplus in 1975. Despite sagging US
demand, the Japanese share of US imports of
manufactured goods last year increased from 22
to 24 percent of the import volume. Steep cuts in
export prices accounted for most of the increase;
in dollar terms, prices of goods sold in the US fell
an estimated 18 percent last year.
US recovery will probably continue to run
ahead of Japan's and cause US imports from Japan
to increase faster than Japan's imports from the
US. In addition, Japanese businessmen still face
substantial inventories, whereas inventory adjust-
ment in the US has been nearly completed.
The upswing in Japanese sales to the US
began last September and will continue through
1976. The volume of Japan's exports to the US
should grow about 9 percent, to about $12.8
billion. Shipments of steel will probably run
slightly above the 1975 figure of 5 million tons.
Shipments of other intermediate products, such
as textile materials, chemicals, and plastics, will
rise perhaps 3 percent in volume this year.
A substantial increase in Japan's exports of
motor vehicles-18 percent of exports to the
US-seems assured. Japanese plans call for a
40-percent increase in shipments this year. A
strong marketing program and generally com-
petitive prices will help Japanese auto firms main-
tain their 9-percent share of the US market. Ex-
ports of other consumer products will register
small gains at best. Sales have stagnated in recent
months, despite the revival in US consumer spen-
ding, largely because of increased competition
from low-cost suppliers such as South Korea,
Taiwan, and Hong Kong.
Japanese imports from the US will total about
$11.1 billion, up 10 percent from the 1975 level.
Imports of agricultural products-almost one
fourth of the total-should increase 5 percent in
volume this year and perhaps 10 percent in value.
Larger purchases of feed grain, mainly sorghum,
will account for most of the volume growth; im-
ports of wheat and soybeans will be up slightly.
Large inventories and the sluggish pace of in-
dustrial growth in Japan will restrain raw material
imports from the US. Only lumber imports will
show a substantial increase.
The slow recovery in fixed investment in
Japan will keep a damper on purchases of US
machinery and equipment. Imports of these items
fell 15 percent in value last year and even more in
volume. With almost all Japanese consumer in-
dustries still operating well below capacity, any
increase in demand for consumer durables will be
met domestically.
The scandal in Tokyo over alleged payoffs by
the Lockheed Aircraft Corporation to Japanese
officials has clearly placed the ruling Liberal
Democratic Party on the defensive.
In response to vociferous demands by the
opposition, Prime Minister Miki has promised a
full investigation of the revelations made in US
congressional testimony by Lockheed's president
late last week. Miki and other conservative party
leaders apparently hope that a rapid airing of the
issue will curtail the damage to their image. The
government has agreed to call a number of
businessmen already implicated to testify under
oath before the Diet next week.
The conservatives have limited the impact of
previous scandals by restricting the release of in-
formation as well as the scope and pace of official
investigations. This time, however, the informa-
tion is being made public in Washington.
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Miki was almost certainly not involved in the
payoffs, but some leading members of the
Tanaka, Ohira, and Nakasone factions as well as a
number of senior bureaucrats may be implicated.
No government officials or party leaders have
been named as principals in the affair so far. Those
now holding government or party posts would
undoubtedly be forced to resign. Conceivably,
Miki himself might be compelled to step down if
the scandal spreads further within the party, but
at this point he seems reasonably confident that a
limited number of resignations, combined with
the public's relatively short memory of such
matters, will suffice to defuse the situation.
Nevertheless, the scandal has already dis-
rupted government and conservative party plans.
Defense officials, for example, are reviewing their
earlier decision to purchase Lockheed antisub-
marine aircraft. Meanwhile, conservative party
leaders have begun to play down the prospects
for general elections this spring.
INDONESIA: THE LAST ACT IN TIMOR
After several months of advancing into
eastern Timor at a snail's pace, the Indonesians,
spurred by a desire to prevent the UN fact-finding
mission from visiting Fretilin areas, in the past two
weeks moved quickly to capture most of the
remaining towns and all airfields. Marines and
paratroopers, with air, armor, and naval support,
captured Fretilin strong points at Suai, Lautem,
and Lospalos, and infantry units moved into
Bobonaro, Vequeque, and Betano.
The Indonesian occupation of the coastal
towns and airfields forced the UN envoy to aban-
don attempts to arrange sea or air transportation
from Australia to Fretilin-held areas. The envoy,
who last month was treated to a carefully manag-
ed tour of Indonesian-controlled areas on the
northern coast, left Australia on February 8 for
Geneva. UN Secretary General Waldheim, who
was visiting in Australia, said he did not consider
the representative's mission terminated, but set
no timetable for his return, adding that the
Security Council now faced a fait accompli.
Jakarta will probably now attempt to delay
raising the Timor issue at the UN for as long as
possible in the hope that by the time the topic
does come up for consideration, they will be in a
position to argue that Timor's integration into In-
donesia is an accomplished fact and that the UN
no longer has a role to play.
Jakarta should be able to establish quickly an
adequate civil administration in the towns. In the
interior, however, Indonesian commanders are
finding it difficult to expand their control. Some
units have suffered significant casualties and are
having difficulty protecting their supply lines and
rear areas. Jakarta has shown a determination to
cope with remaining resistance.
Fretilin forces, on the other hand, are
gradually disintegrating. Faced with mounting
casualties, dwindling supplies, and growing
numbers of defections, they are withdrawing into
the rugged mountains of the interior. 125X1
PaaR 1 R WFFKI Y Sl IMMAPY Fah 1Q 7r.
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CUBA: CONSTITUTIONAL REFERENDUM
Cubans go to the polls on February 15 to ap-
prove a new constitution. The government has
for some months indicated publicly that it con-
siders near unanimous approval of the constitu-
tion a foregone conclusion. This confident
presumption may be intended as a subtle threat
to those who might be tempted to vote "no" to
register dissatisfaction with regime policies such
as Cuba's increased military role in Angola.
This will be the first time since 1959 that the
government has risked its prestige in a national
referendum. The risk is admittedly small; the
government has spent much of the past ten
months publicizing the draft constitution and giv-
ing the population ample opportunity to make its
sentiments known through the mass
organizations. Rigging the vote to give the im-
pression of widespread popular approval will
probably be unnecessary.
mal means of political succession designed to en-
sure the continuity of the revolution.
Approval of the constitution will also tend to
undercut two main lines of criticism leveled at the
Castro government from abroad, mainly by
Cuban exiles: failure to honor pledges to submit
the regime to the test of a vote; and failure to
restore the Constitution of 1940 as Castro had
promised before he came to power.
The new constitution will replace the out-
moded Fundamental Law of February 1959, a
hastily concocted document based loosely on the
Constitution of 1940 that Castro originally used to
give his regime temporary legal underpinning.
Although the Fundamental Law is technically still
valid, it has in effect been replaced with rule-
by-decree by the Council of Ministers. The new
constitution will give the Castro government
more substantial legalistic window dressing.
Part of the new constitution will go into effect
by means of a constitutional transition law on
February 24, one of Cuba's major political
holidays. The remainder will be implemented on
December 2-Armed Forces Day-the date set for
convening the first National People's Assembly.
Some 5.5 million Cubans will be eligible to vote,
and the mass organizations will work to ensure a
large turnout. Voting is not required by law, but
those who want to maintain their political and
social standing will be sure to underscore their
revolutionary bona fides by appearing at the
ballot box.
With the approval of the constitution, the
Castro regime will have reached another impor-
tant milestone in the process of institutionaliza-
tion that began in 1970. The full implementation
of the constitution and the convocation of the
National People's Assembly will signify the final
consolidation of the Cuban revolution, terminate
the provisional nature of the regime's political
and administrative apparatus, and establish a for-
GUATEMALA: THE EARTHQUAKE
The earthquake and aftershocks that struck a
broad belt of Guatemala last week, killing
thousands and causing widespread destruction,
dealt the economy a grievous setback. The dis-
aster came just as the economy was recovering
from a mild slump and its future looked bright.
Before the calamity, agricultural exports were
increasing and tourism was providing a healthy
boost to the economy. Adding to the favorable
economic prospects were large amounts of
capital for oil exploration and development.
Initial reports indicate that the oil exploration
region in the Peten area did not suffer, but that
tourist, agricultural production, and shipping
facilities were hard hit.
Most other sectors of the economy were also
dealt heavy blows. Railroads, main highways,
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bridges, power and telecommunications lines,
and the port of Puerto Barrios on the Atlantic
sustained major damage. The Guatemala City -
Puerto Barrios highway has been rendered im-
passable by over 100 landslides and the collapse of
two large bridges. Half the capital's fuel supply
and much of its food supply comes over this
highway. President Laugerud has asked for a US
engineer battalion to help clear the road. The
railway from the Atlantic is also out of commis-
sion. Three to six months will be needed to
reopen it and the highway. The Inter-American
highway is also blocked in places.
The main pier at Puerto Barrios, Guatemala's
biggest port, was destroyed. The port normally
handles nearly all the country's banana and sugar
exports and half its coffee shipments. Concern
that the quake raised the sea bottom at Puerto
Barrios, making the harbor dangerous to ships, is
apparently unfounded-one ship with a 28-foot
draft docked there on February 6.
The US embassy reports that there is no im-
mediate shortage of basic foodstuffs, particularly
in Guatemala City. Over the longer run,
agricultural production will suffer greatly since
available money will be used to rebuild homes
and other buildings rather than to invest in fer-
tilizer and farm machinery. The banana plan-
tations in the eastern part of the country were
badly hit and may be slow to recover. Beans, a
Guatemalan staple, will be in short supply for
some time because the major bean growing
region, Chimaltenango, bore the brunt of the
quake.
Some 220,000 homes were destroyed and
over a million people, one sixth of the popula-
tion, left homeless. The economy will probably
require outside assistance for the massive
rebuilding in store.
Guatemala's principal problem in the coming
weeks will be to organize and utilize the disaster
aid that is flowing in from numerous foreign
governments and private donors. The govern-
ment has established a national emergency com-
mittee to cope with the critical task of distributing
food, medical supplies, and equipment, but it has
already had a change in leadership because of
reported inefficiency. The government has, in
effect, turned over to the US government respon-
sibility for relief in the worst hit areas, and the
most effective efforts to date have been those of
private organizations.
The disaster has brought political activity to a
standstill. The talks with the British on Belize,
scheduled to begin on February 9, were post-
poned for at least two weeks. An important
meeting on Central American economic integra-
tion has been canceled. Certainly, any
Guatemalan plans to invade Belize will have to be
set aside for some time, if not abandoned. Even
so, the government's rejection of British govern-
ment aid confirms that its attitude on Belize has
not wavered. There is no word on whether the
disaster will prevent President Laugerud from
meeting, along with the other Central American
presidents, with Secretary Kissinger in San Jose,
Costa Rica, later this month.
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GUYANA: TOWARD A ONE-PARTY STATE
Guyana will celebrate its tenth-and possibly
its last-anniversary as a parliamentary democracy
this May, if Prime Minister Forbes Burnham has
his way. A committee of the ruling People's
National Congress is drafting a new constitution
that is expected to sweep away the last vestiges of
former British rule and transform the country into
a de facto one-party socialist state.
The tentative timetable calls for the new con-
stitution to be submitted to parliament around
May 26-Independence Day. A plebiscite is to
follow within six months. Burnham's control of
the political situation is so pervasive that there will
be little effective opposition from the majority
East Indian population or moderate
Afro-Guyanese.
In fact, there is evidence to suggest that
Cheddi Jagan's East Indian - based People's
Progressive Party plans to end its long-standing
opposition to the government and return to
parliament under a private agreement reportedly
worked out between Jagan and Burnham. Jagan's
party protested Burnham's vote-rigging in the
1973 general elections, and party representatives
have since refused to take their seats in parlia-
ment. Details of the new arrangements are not
known, but at a minimum Jagan would have to
support the proposed constitutional changes; in
return, Burnham might allow Jagan or his
representatives some form of participation in the
government.
This arrangement would benefit both parties.
For Burnham, support of the major opposition
party is essential if he should attempt to seek ap-
proval for the new constitution through an honest
referendum. For Jagan, a return to parliament
would end the party's political isolation, satisfy his
reported desire to have a say in the new constitu-
tion, and assuage his principal bankrollers, the
USSR and Cuba, who have been urging Jagan and
Burnham to come to terms.
The Jagan party newspaper, the Mirror, has
apparently received instructions to reflect the
new cordiality between the once-bitter an-
tagonists and has toned down its attacks on the
government's legitimacy. In turn, the
government's mouthpiece, the Daily Chronicle, is
reporting activities of the opposition party
leaders. An official statement by the People's
Progressive Party that it would resist attempts by
"imperialist agents" to topple the Burnham
government received heavy coverage in the
government's press.
The strengthening of ties between the two
parties was also apparent last December when
representatives of both parties traveled together
to Havana to attend the Cuban Communist Party
Congress. Jagan later made his first known
appearance at a government-sponsored event,
one honoring visiting representatives of the
Angolan MPLA. If Jagan's support continues
through the coming period ofconstitutional
change, Burnham will have little difficulty forging
his socialist state. Tentative steps have already
been taken in that direction by introducing a
quasi-compulsory National Service camp for
youths, making political indoctrination man-
datory in the schools, and increasingly concen-
trating economic power in state corporations.
This process will take time even with the
political power that Burnham is able to wield. To
make the new system work, Burnham must
galvanize people into a 25X6
strongly regimented society in the face not only
of general public apathy and alienation from the
East Indian majority, but lethargy and corruption
within the governing party.
ARGENTINA: LABOR SUPPORT WANES
President Maria Estela Peron may be on the
verge of losing her only remaining source of
significant support, the powerful labor movement
that was once synonymous with Peronism. Some
labor leaders are now saying that they would be
willing to see the army oust her.
Union leaders are angry over their systematic
exclusion from government decision making,
now the province of a few of Peron's personal ad-
visers. Some suspect that the President's inner cir-
cle advised against the last general pay increase,
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and most were upset by the dismissal of the
respected economy minister, Antonio CafierQ, a
labor favorite.
The latest affront was the President's open
bid last week to renew relations with dissident un-
ionist Vittorio Calabro, the Buenos Aires provin-
cial governor who was read out of the Peronist
movement some months ago. Calabro has long
been the most important challenger to labor's
two main leaders. Union heads met Monday to
discuss how to respond; one proposal calls for all
labor representatives in congress and the govern-
ment to resign simultaneously.
The labor movement's estrangement from
the administration would remove a major impedi-
ment to a military take-over. For some military
leaders, an open break between-Peron and labor
would be seen as proof of the popular repudia-
tion they feel they need to justify intervention.
One labor leader is said to have confided that
workers would raise only symbolic resistance to a
military coup. Reluctance to involve troops in
clashes with workers has been an important con-
sideration to officers who have so far hesitated to
move against the governments
Last year, the administration, at the urging of
then strong man Lopez Rega, tried to rescind a
wage increase for workers. The result was a
general strike that not only restored the wage
hike, but also led to the ouster of Lopez Rega.
What labor wants now is not higher wages, but to
break the presidential inner circle's hold on
power.
PERU: BUYING TIME
The Morales Bermudez government has
successfully staved off the labor wolves at its door
for now, but trade unions are planning new
demonstrations to express dissatisfaction with the
austerity program and the lid imposed on wages.
The labor movement and its sympathizers
want to capitalize on general discontent over ris-
ing prices and food shortages to convince Peru-
vian leaders that there should be no slowdown in
the revolutionary process and, moreover, that a
radical change in labor policy is imperative.
The recently formed Unifying Council of
Labor Organizations, an umbrella group led by
Moscow-oriented unionists, has been planning a
mass rally in downtown Lima on February 18, the
day of Secretary Kissinger's visit. The government
can be expected to ban any such activity, but ex-
tremists might try to create enough disorder to
force the government to suspend civil guarantees.
Radicals probably hope to force the cancela-
tion of a demonstration set for February 20 by the
American Popular Revolutionary Alliance-a
long-time enemy of the left. A 48-hour strike
sponsored on February 2 by the Aprista labor con-
federation fizzled, in part because other unions
did not cooperate. In addition, the government's
timely decision to abrogate a 1913 law restricting
rights to strike, and its formation of a tripartite
commission (government, labor, and manage-
ment) to study labor problems helped to dampen
the strike attempt. These can be considered little
more than stopgap measures. If the government is
unable to satisfy workers on the wage question, it
is almost certain to face wider-and perhaps more
troublesome-work stoppages in the future.
The labor problems confronting the Morales
Bermudez government will not be easy to resolve.
The government is faced with an urgent need to
enforce fiscal austerity measures. Peruvian
leaders, fully aware that economic conditions
could worsen, hope to defuse the tense labor
situation, or at least prevent the unions from
better coordinating their actions. This is likely to
prove difficult, since many unions that did not
join in supporting the recent general strike share
opposition to the government's wage policies and
seem prepared to step up their demands.
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OPEC: NEW AID FACILITY
The aid facility agreed to at an OPEC finance
ministers' meeting during the last week of January
falls far short of the expectations of non-oil
developing countries. The announcement of the
new facility follows almost two years of OPEC
debate on whether the oil cartel should handle
aid funding. The $800 million in pledges is short of
the $1 billion annually suggested by an agreement
in principle reached late last year. The life of the
facility is limited to one year-1976-instead of
the five years urged by the co-sponsors, Iran and
Venezuela. Intended largely as a political gesture
to win support of oil-importing developing coun-
tries, the new arrangement will make only a small
contribution to aid.
. Eleven OPEC members tentatively pledged
contributions, which must now be ratified by the
national governments. The shortfall in pledges is
mainly due to lower than expected commitments
by Saudi Arabia, Iraq, and the United Arab
Emirates. Indonesia and Ecuador committed no
funds, but they were not expected to contribute
more than token amounts in any case. The poor
response of the three Arab countries stems from a
desire for greater control over the choice of
recipients, from continued political infighting
among cartel countries, particularly Saudi Arabia
and Iran, and from disagreements as to the
method of determining the size of contributions.
OPEC considered two distinct schemes to ap-
portion donor shares. Iran and Venezuela
Contributions to the OPEC Aid Facility
(Mil
i
U
l
on
S_,$,l
Tian
210
Saudi Arabia
202
.Venezuela-
112
Kuwait
72
Nigeria
52
Iraq
40
Libya
,
40
United Arab emirates
33
Algeria
20
Qatar
18
Gabon
1
800
proposed tying pledges to a minimum of 10 cents
per barrel or about 1 percent of oil export
revenue. Algeria and other states with balance-
of-payments constraints instead advocated tying
contributions to surplus revenues. Unable to
agree on a uniform standard, the OPEC countries
ended up haphazardly pledging amounts suiting
their individual interests.
The formal structure of the facility is still un-
clear. Iran and Venezuela urged an independent
authority to administer the fund; Saudi Arabia
argued instead for coordination authority to
oversee bilateral disbursements. The final com-
promise conforms more closely with the Iranian
formula in that it establishes a "governing coun-
cil" to formulate general policy, with voting
power weighted by national contributions, but
leaves to individual states the actual disbursement
of funds. The size of Iran's and Saudi Arabia's con-
tributions gives them veto power in the council.
Nevertheless, it is not yet known whether the
council will come under the formal OPEC struc-
ture, which would require the approval of all 13
OPEC members. The question will probably be
decided at the next OPEC conference, scheduled
for late spring.
OPEC countries felt they had to come up with
an aid package because of increasing pressure
from non-oil developing countries for some form
of relief from higher oil import bills. OPEC is
counting on support from these countries on
energy and economic Issues in the dialogue with
developed countries at the Conference of Inter-
national Economic Cooperation. Although OPEC
members believe that the aid facility will provide
useful leverage to assuage developing countries
criticism, oil-importing developing countries will
probably soon realize that this well publicized
program has relatively little substance.
Only a fraction of the $800 million under the
facility will be new aid. Agreement has been
reached to make at least part of OPEC country
contributions to the International Agricultural
Development Fund flow through the facility. The
facility may also act as a channel for OPEC country
ib
contr
utions to other multilateral programs, such
as the International Development Association or
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