WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A011300220001-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 17
• Document Creation Date: December 19, 2016
• Document Release Date: June 16, 2006
• Sequence Number: 1
• Publication Date: May 28, 1976
• Content Type: SUMMARY

25X1 Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Next 1 Page(s) In Document Exempt
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
 Approved For Release 2006/11/13 : CIA-RDP79-00927AO113
220001-4
Viecret
Weekly Summary
Secret
CI WS 76-022
No. 0022 / 76
May 28, 1976
Copy N9 1410
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
 Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
WEEKLY SUMMARY, issued every Friday mornin
by the
g
Office of Current intelligence, reports and analyzes sgn'rfi
d
t
evelopments at the week through moon on Thursday. It
by the Office of Economic Research, the Office of Strafe P
esearch, the Office of Geographic and Cartographic
Research, and the Directorate of Science and Technology,
SECRET
CONTENTS
1
Africa
Angola; Rhodesia; Ethiopia
3
Middle East
Lebanon
3
Europe
Italy; Spain; Greece;
USSR-West Germany
5
Far East
Philippines;
Singapore
6
International
OPEC
7
Ethiopia: Disa
rray Within Regime
9
Algeria: Boum
ediene's Domestic position
11
Poland: Growi
ng Western Debts
comments and queries on the contents of this
publication are welcome. They may be
directed to the editor of thp kly
Summary,
Approved For Release 2006/11/13 : CIA-RDP79-00927A01 1 300220001-4----
 Approved For Release 2006/11/1@;Ef'iDP79-00927A011300220001-4
ANGOLA / 2 __ ? 40 _//
Three months after the end of
large-scale fighting, Angola's economy
remains in serious disarray, and the Neto
government is having difficulty main-
taining law and order.
ven in
Luanda assaults anT armed robberies
have made most streets unsafe even dur-
ing the day. Much of the banditry and
violence is apparently the work of hastily
recruited, heavily armed soldiers who
have never been under the full control of
the Popular Movement leadership.
A worsening food shortage is
aggravating the security situation. Fresh
food is virtually unavailable in the major
towns, partly because of the total collapse
of the country's transportation system.
Medicine is also in extremely short
supply.
The violence and economic problems
are intensifying long-standing animosities
between Angolan blacks and mulattos.
Some poor blacks are said to be focusing
their resentment on the Cuban ex-
peditionary force as well as the mulatto-
dominated Popular Movement
leadership.
President Neto and other Angolan
leaders have been exhorting workers to
return to their jobs but with little apparent
effect so far. A continuing factional
struggle within the Popular Movement
doubtless hampers efforts to deal with
Angola's problems.
Remnants of Jonas Savimbi's National
Union continue to harass government and
Cuban forces in southern Angola. r
the regime does not control
e province of Bie or the area around
Luso because of the frequent guerrilla at-
tacks.
Visit to Moscow
Radio Moscow announced on May 25
the conclusion of talks between Soviet
leaders and the high-level Angolan
government delegation that arrived in the
USSR the day before. The announcement
said the talks were held in an atmosphere
of "complete mutual understanding," but
shed little light on their substance.
General Secretary Brezhnev, Premier
Kosygin, Foreign Minister Gromyko, and
Defense Minister Ustinov headed the list
of senior Soviet officials who met with the
Angolan delegation led by Prime Minister
Nascimento. The participation of Ustinov
in the discussions, along with top Soviet
foreign trade and aid officials, indicated
that questions of military and economic
aid were high on the agenda.
In his speech at the welcoming banquet
for Nascimento, Kosygin reaffirmed
Moscow's strong support for the Popular
Movement government in Luanda and for
the liberation struggle in southern Africa.
Repeating a theme President Podgorny
used in his welcoming toast last week for
Mozambican President Machel, Kosygin
stressed that "detente" and support for
revolutionary movements are not incom-
patible and that improved East-West
RHODESIA 12-1-5
Black nationalist insurgents have
carried out new attacks on Rhodesia's
road and rail links with South Africa and
Botswana. 25X1
Last weekend, guerrillas attacked two
cars on the road linking Bulawayo,
R" M
'I -
Rhodesia's second largest city, with Beit-
bridge, the main border crossing point to
South Africa. The incident follows a
similar attack late last month on the other
main road to the South African border.
In another attack last weekend,
guerrillas damaged a locomotive on the
rail line between Bulawayo and Botswana.
This attack followed an earlier incident on
the same line and several attacks on the
direct rail link with South Africa.
The Rhodesian government has been
able to repair damage to its railways
quickly without much disruption in ser-
vice. Armed convoys are now being used
to protect civilian traffic on the highways.
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 1 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/jV&EfIA-RDP79-00927A011300220001-4
The continuing attacks point up the dif-
ficulty Salisbury faces in coping with
small guerrilla bands that infiltrate
southeastern Rhodesia from Mozam-
bique. The Rhodesians have moved ad-
ditional forces into the area and con-
ducted some operational sweeps, but the
insurgents appear to be successfully
avoiding contact.
Tanzanian President Nyerere and
Mozambican President Machel,
meanwhile, appear to be rethinking their
plan to bypass the squabbling Rhodesian
black nationalist political leaders and
create a new leadership from the ranks of
the guerrillas. The two presidents have
sponsored a Zimbabwe People's Army, or
"third force," but they apparently are
becoming concerned over the un-
willingness of the guerrillas to accept the
new leadership.
Nyerere and Machel are unlikely to
abandon their efforts to assume direct
control of the military struggle against
Ian Smith's government, but they
reportedly plan to meet again soon with
Zambian President Kaunda and
25X1 Botswanan President Khama to consider
25X1 I
what to do about the t' disarray
among the insurgents.
ETHIOPIA;, j
The ruling military military council, desperately
searching for a way to bring the Eritrean
rebellion under control, is sending
thousands of armed but largely untrained
peasants into the province to spearhead a
massive military offensive against
secessionist guerrillas. Regular army
troops will hold the larger towns and
other areas considered secure and will be
used as a back-up force should the
peasants meet serious resistance.
The council decided to mobilize the
peasants because it could not rely on the
regulars. The troops are restive and tired
of fighting a war many believe cannot be
won. Many have refused to take
aggressive measures against the
guerrillas.
The peasant offensive is unlikely to be
decisive, although government forces may
succeed in restricting rebel activities,
pushing them farther away from the cities
and highways, and destroying some of
their base camps. Many peasants are
proving to be recalcitrant participants and
are resisting the government's mobiliza-
tion efforts. Some peasants have
destroyed bridges and blocked highways
to prevent the passage of trucks bound for
Eritrea for use in the offensive.
The council hopes its obvious
preparations for new action against the
rebels will induce them to begin peace
talks. It has attempted to arrange con-
tacts with at least one of the two main
rebel factions. A radio and television ad-
dress in mid-May by council chairman
Teferi Benti was designed to show the
N
government is seriously seeking a political
solution. His reiteration of the
government's promise to grant regional
autonomy to all provinces is unlikely,
however, to be acceptable to the guerrillas
as a basis for a settlement. Other
"concessions" contained in the speech are
probably too vague to appeal to the in-
surgents.
Sudan is concerned that the fighting
will spill across the border and lead to
clashes between Sudanese and Ethiopian
forces. Khartoum has moved troop rein-
forcements and antiaircraft units to the
border. President Numayri on May 24
appealed to Addis Ababa and the in-
surgents to begin negotiations without
preconditions. (An analysis of the deepen- 25X1
ing divisions within the ruling military
council and in Ethiopian society general-
ly appears on page 7.)
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 2 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/11/13 : ? ,IRLT79-00927AO1
LEBANON /6 /
A de facto cease-fire settled over much
of Lebanon this week as president-elect
Ilyas Sarkis continued his efforts to
arrange a formal truce. Sarkis' initiative
is the first major test of his leadership,
and any prolonged delay in implementing
the truce will undercut his effectiveness
and the Syrian diplomatic victory in
engineering Sarkis' election. Sarkis
believes his grace period may last only a
few more days and stepped up his contacts
this week with principal Christian and
Muslim leaders.
The most immediate obstacle for
Sarkis is President Franjiyah's continuing
reluctance to step down. The Christian
camp is divided and confused over what
Franjiyah should do. Many Christians
consider Franjiyah's presidency an impor-
tant symbol of defiance of the Lebanese
left and the Palestinians, while others
recognize the detrimental effect further
delay could have on Sarkis and the
prospects for peace. Interior Minister
Shamun and several of Franjiyah's close
advisers are primarily responsible for en-
couraging the President's stubbornness.
French President Giscard's recent offer
to send troops to Lebanon has probably
also encouraged Franjiyah's hope that
outsiders will eventually come to his aid.
The French proposal created an uproar in
Muslim circles this week that has ended
serious consideration of the offer, at least
for the present.
Leftist leader Kama] Jumblatt accepts
the truce proposal in principle, but ap-
parently has a list of conditions that will
be difficult for Sarkis to meet. Jumblatt
has made clear that he wants
"fighters"-presumably the heads of the
various militias-to participate in future
settlement' talks instead of old-line
politicians. He has also suggested that the
negotiations be held outside Lebanon, an
apparent bid to reduce Syria's influence
over the talks.
Although Jumblatt may be somewhat
flexible on these issues, he will be uncom-
promising in his demand that Franjiyah
resign before the formal implementation
of a truce. The leftists believe that
military pressure is the only way to effect
Franjiyah's departure, and they will not
publicly renounce the use of force-as
Sarkis has proposed-until the President
has stepped down.
ITALY A y J6elrce ci
The campaign for Italy's parliamentary
election on June 20 and 21 is in full swing
now that the parties have completed their
candidate lists and put the finishing
touches on their platforms.
The Communists unveiled their election
platform first and appear to have cap-
tured the initiative with party chief
Berlinguer's call for a post-election
emergency government consisting of all
parties except the neo-fascists. The party
is presenting economic, social, and in-
stitutional proposals framed in general
terms calculated to offend no one. It is
emphasizing its alleged independence
within the international communist move-
ment and its pledge to continue Italy's
relations with NATO, the EC, and the
US.
The Christian Democrats' platform re-
jects Berlinguer's formula for an
emergency government and calls for a
new coalition with the Socialists that
would be open to the smaller parties, with
the exception of the neo-fascists.
The Christian Democrats are trying to
combat their image as a tired, worn-out
party by pointing to the substantial
number of new faces among the party's
candidates. The Christian Democrats'
ability to make "renewal" a credible cam-
paign theme will be hampered, however,
by the party's failure to replace members
of the old guard who are facing serious
corruption charges.
The Socialists, in an effort to protect
the party's pivotal position by keeping
nearly all post-election options open,
devised a platform that endorses
Berlinguer's emergency government for-
mula but does not categorically rule out
another coalition based on Christian
Democratic - Socialist cooperation. The
minimum Socialist condition for another
coalition with the Christian Democrats
appears to be acceptance by the latter of
an arrangement that would permit the
government to negotiate openly with the
Communists and to seek Communist sup-
port in parliament.
Most opinion polls tend to agree that
the Christian Democrats retain a plurality
but differ over the gap between them and
the Communists. Some surveys show the
two parties almost even, while others
show the Communists trailing by a signifi-
cant margin. Nearly all the polls show
about a quarter of the respondents un-
decided or indifferent, which means that
the final three weeks of campaigning will
be crucial.
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 3 WEEKLY SUMMARY May 28, 76
 Approved For Release 20(MCRET: CIA-RDP79-00927A011300220001-4
King Juan Carlos of Spain will visit the
US next week fresh from his first concrete
achievement in liberalizing the political
system he inherited from Franco last
November.
On May 25, the Cortes-Spain's
parliament-passed government-spon-
sored legislation relaxing restrictions on
freedom of assembly. While this bill was
less controversial than other provisions of
the government's reform program, the
overwhelming parliamentary support it
received augurs well for the approval of
other reform laws. Action is expected
soon on provisions to legalize political
parties and reform the penal code.
The King's basic problem is still to con-
vince leftists and centrists his reforms go
far enough without completely alienating
the right. A major obstacle has been foot-
dragging by Prime Minister Carlos Arias
who has been retained because of the
King's belief that there is little chance of
getting a more liberal leader through the
nominating procedure of the rightist-
dominated Council of the Realm.
Arias is still stressing reverence for the
past and continues to cater to the right,
especially in his refusal to enter a dialogue
with leaders of the opposition political
groups. To fill this gap, the King has
himself recently assumed a more active
role in pushing for reforms and has begun
to meet with leaders of the democratic op-
position.
The King's dissatisfaction with Arias'
performance is a topic of open discussion
in Spain, and there is speculation that
Juan Carlos will replace the prime
minister after the US trip. The
government's expected success in pushing
liberalization measures through the
Cortes, however, might ease pressures for
King Juan Carlos with Prime Minister Arias (r)
The King would doubtless prefer to
avoid a showdown with the right if possi-
ble, but he is capable of well-timed
dramatic moves to point up his
leadership. Recent trips with his wife and
family to various regions of Spain have
resulted in an outpouring of popular sup-
port for the monarchy and probably have
strengthened his hand in meeting any
challenge from the right.
GREECE 2
Clashes between Greek police and lef-
tist protesters in Athens and on two
islands in the Aegean this week have in-
jected new strains into Greek politics.
The violence in Athens was touched off
when police tried to prevent striking
workers from marching on parliament to
protest a proposed new labor law banning
politically motivated strikes. The subse-
quent attacks by demonstrators on
government buildings and a pro-govern-
ment newspaper had the earmarks of
pre-planned action and amounted to the
first major challenge to the government
by the left since the restoration of
democratic rule in 1974.
On the islands of Rhodes and
Mykonos, police clashed with protesters
who were trying to block shore visits by
personnel from visiting US naval vessels.
Prime Minister Caramanlis sent a cabinet
minister to Rhodes to coordinate the ef-
forts of the security forces, but the official
soon concluded that he could not
guarantee the safety of US servicemen
and asked the ships to depart.
The government pinned the blame for
both disturbances on the Moscow-backed
Communist Party and the radical so-
cialist followers of Andreas Papandreou,
and condemned the actions of the two
parties. Even main opposition party
leader Mavros decried the distur-
bances-comparing them with those that
brought the junta to power in 1967
-although his party had earlier taken
exception to the new labor bill. In de-
25X1
25X1
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 4 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/11/13 : (5979-00927A011300220001-4
fiance of the left, the government placed
the bill before parliament and quickly se-
cured its passage.
The clear indications that the
demonstrations were a deliberate leftist
effort to test the government's determina-
tion may well lead Caramanlis to move
away from his middle-of-the-road
policies-designed to portray him as the
leader of all Greeks-and to adopt a more
rightist course.
Such a move, already implicit in the
specific attack against those responsible
for the demonstrations, could lead to a
polarization of political forces but it
would be welcomed by the rightist compo-
nent of Caramanlis' constituency in-
cluding the conservative military.
USSR-WEST GERMANY
The USSR issued formal government
statement on May 22 defending its com-
mitment to "detente" and criticizing
groups in West Germany for trying to un-
dermine improvements that have taken
place in Soviet - West German relations.
Although the statement was addressed
to Bonn, it was obviously also aimed at a
larger Western audience, including the
US. A substantial portion was devoted to
refuting Western criticisms of "detente"
and to giving assurances that Moscow will
continue its "patient and consistent" pur-
suit of a relaxation of tensions.
The Soviets said they have no plans to
attack anyone and that any increase in
world tension should not be blamed on
Moscow. Soviet defense spending, they
added, is justified in light of Western ex-
penditures. The statement yielded no
ground in restating Moscow's commit-
ment to support "national liberation
movements" and rejected Western
attempts to use "detente" to "disarm" the
USSR in the ideological arena.
In the West German context, the state-
ment appeared to be a response to
Foreign Minister Genscher's recent sharp
remarks on Soviet policy and to criticism
25X1
of Bonn's policy toward the East by the
West German opposition. The statement
added that West Germany has no real
alternative to "detente" except isolation.
Increased foreign trade, it implied, was
one way to improve relations between the
two countries.
In a departure from usual Soviet
rhetoric, the Soviets described the
Quadripartite Agreement on Berlin as
viable only if "normal good-neighborly
relations" exist between. West Germany
and communist countries, The implica-
tion was that Soviet behavior on West
Berlin might become more truculent
should "detente" further sour.
The defensive tone of the statement
reflects Soviet apprehensions that
"detente" is coming to a halt. The choice
of West Germany as a target may be an
effort to protect US-Soviet relations from
direct polemics. The statement may also
have been a reaction to internal pressure
for a tougher Soviet response to Western
criticisms of "detente." One Soviet
Foreign Ministry official said this week
that he thinks Moscow has been too
restrained in replying to the West.
PHILIPPINES - 417
President Marcos is scheduled to arrive
in Moscow on May 31 for a five-day visit.
The immediate purposes of the trip are to
establish Philippine diplomatic relations
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 5 WEEKLY SUMMARY May 28,. 76
 Approved For Release 20QJ,3 : CIA-RDP79-00927A011300220001-4
Oct
with the USSR and to sign a trade agree-
ment. The visit is part of Marcos' con-
tinuing effort to broaden the Philippines'
foreign relations and markets and end
Manila's reputation as a client of the US.
Marcos had intended to visit Moscow
late last summer to balance his journey to
Peking in June, but the trip was post-
poned when Moscow was unwilling to
guarantee a meeting with General
Secretary Brezhnev. Marcos places a high
value on his visits abroad to strengthen his
prestige at home; he now expects to meet
with Brezhnev and other top Soviet
leaders.
Marcos probably hopes that establish-
ment of relations with the USSR will
strengthen the Philippines' chances of be-
ing admitted to nonaligned councils.
Manila has so far failed to gain admission
to meetings of the nonaligned bloc. Its
security ties with the US and the presence
of US bases in the Philippines will con-
tinue to be a hindrance to its getting an in-
vitation to the nonaligned conference in
Sri Lanka in August.
In his talks with the Soviets, Marcos
will probe Moscow's attitude toward the
Association of Southeast Asian Nations.
In the last year or so Soviet propaganda
has adopted a more positive attitude
toward ASEAN, but Moscow echoed
Vietnamese accusations at the time of the
Bali summit in February that ASEAN is
a US-sponsored military alliance.
SINGAPORE
Prime Minister Lee Kuan Yew's recent
two-week visit to China will enhance his
prestige at home and among Singapore's
partners in the Association of Southeast
Asian Nations.
Peking understood before Lee arrived
that Singapore would not develop special
ties with China despite Singapore's
predominantly Chinese population. Lee
spoke in English throughout his visit,
presumably to underscore Singapore's
distinctive national identity, and
emphasized that its geographic position
requires close relations with the ASEAN
nations.
Peking gave Lee a cordial reception.
The Chinese did not challenge Lee's
reiteration that Singapore will not be
ready for diplomatic ties with China this
year, but both sides agreed that they could
develop closer trade and cultural relations
in spite of differing political viewpoints.
The Singaporeans expected that an
agreement would be reached on an ex-
change of trade missions, but there has
been no announcement yet.
Chinese Premier Hua Kuo-feng's
favorable comments on ASEAN's zone of
neutrality at a banquet for Lee will be
welcomed in Singapore and probably in
other ASEAN countries, particularly
because of the contrast with Hanoi's
hostility toward ASEAN following its
summit in February.
OPEC /-5 2-
A report that exaggerates the impact of
inflation on the prices of goods imported
by member states will be presented to the
meeting of the Organization of Petroleum
Exporting Countries that opened on May
27. It could strengthen the arguments of
members who favor an oil price hike at
midyear.
25X1
The report, approved by the Economic
Commission Board of OPEC, estimates
inflation in the cost of OPEC-country im-
ports at 15.4 percent from October 1,
1975-when oil prices were increased 10
percent-to June 30, 1976. The study
greatly overstates the inflation. We es-
timate that OPEC import prices will have
increased less than 3 percent during the
period.
The Commission, faced with an ab-
sence of reliable import price data, asked
individual OPEC members to provide
pertinent information. Import price data
is not available for many OPEC coun-
tries, particularly Middle East members,
and we believe several countries provided
only estimates, which includedcharges for
freight, insurance, and demurrage.
The inclusion of these non-merchandise
costs overstates OPEC's import price es-
timates. Iran alone paid $1 billion in
demurrage charges in 1975-8 percent of
its total import bill-as ships had to wait
up to 160 days before dockage was
available. Nigeria, Iraq, and Saudi
Arabia also had port congestion and ad-
ministrative bottlenecks that resulted in
large demurrage and insurance charges.
These fees are a penalty for poor planning
rather than an increase in import costs
resulting from inflation in the West.
To arrive at its estimate of price in-
creases in the first half of this year, the
Commission arbitrarily doubled the
Organization for Economic Cooperation 25X1
and Development's projection of domestic
inflation in the OECD states.
Our estimates of import price changes
in OPEC countries are based on dollar ex-
port prices reported by the Big Seven
developed countries, which account for
more than 70 percent of OPEC imports.
OPEC import prices declined in the
second and third quarters last year be-
cause of the recession in the West, lower
raw materials prices, and the strengthen-
ing of the dollar. The decline ended in
the last quarter, and we expect only a
small price rise in the first half of 1976.
Prices in the first half of the year should
thus remain slightly below last year's
average level.
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 6 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/11/13 : GIRB1P79-00927A011300220001-4
The sharp turn toward radicalism by the faction now domi-
nant in Ethiopia's ruling military council is aggravating
divisions within the government and stirring old antagonisms
among the country's principal ethnic groups.
Radical policies imposed by the domi-
nant faction of Ethiopia's ruling military
council are deepening divisions within the
council and in Ethiopian society general-
ly. This, together with the lack of a strong
leader capable of unifying the diverse pop-
ulation, is causing increased social and in-
stitutional disarray.
Major Mengistu Hailemariam, the rul-
ing council's first vice chairman, has
emerged in recent months as its single
most influential member, but his
leadership is not accepted by all council
members. His bid for power seems likely
to set off another round of maneuvering.
His opponents, most of whom favor more
moderate socialist policies, are dis-
organized and leaderless.
Turning Leftward
Mengistu has been the driving force
behind the council's sharp turn leftward.
The shift was apparent in the announce-
ment in April of a Marxist-oriented
"national revolutionary program," touted
as the basis for transforming Ethiopia.
Previous council pronouncements were
issued by anonymous spokesmen, but
Mengistu personally outlined this
program in a radio and television speech.
The new and still fuzzy program is an
attempt by Mengistu and his supporters
to appeal to radical leftist civilians, in-
cluding students, teachers, and trade un-
ionists. These radical civilian groups want
to take over the revolution and apply
quick and drastic medicine for the coun-
try's problems.
~ /~ CeF--
Ethiopia: Disarray Within Regime
Their stated goal, to achieve by mass
action an almost overnight "socialist
modernization" of a still highly
traditional rural society, is clearly un-
realistic. They are, however, the best
organized and most vocal of the political
groups in the large towns where they have
their base of support, and they wield in-
fluence out of proportion to their
numbers.
Mengistu hopes by drawing closer to
the radical left to rally civilian support for
the unpopular military regime, which has
no organizational base and has not tried to
achieve a consensus on appropriate steps
toward the broad socialist goals that most
Ethiopians seem willing to accept.
The council has been ruling by fiat and
has turned increasingly to repression to
overcome resistance to its actions. It has
little solid support in the country. Its only
boosters are the poorer Ethiopians who
have benefited-psychologically at
.least-from the toppling of landlords and
the rich. The new program has little to
offer the apolitical peasants or other
Ethiopians who, while advocating
changes, are skeptical of the council's
leadership.
Mengistu is receiving ideological advice
from a 14-member civilian coin-
mittee-known as the "polit-
buro"-established last fall to aid the
council in forming its program. Its
members, well-known Marxists, are to
undertake the political education and
organization of the Ethiopian masses.
Mengistu has failed so far to win over
most leftist civilians. Students, teachers,
and workers continue to demonstrate
periodically, demanding a return to
civilian government.
In general, leftists who oppose the
council are united only in their desire to
see the current military leadership ousted.
The most significant anti-Mengistu activi-
ty is directed by an underground Marxist
organization that may have ties to-or be
protected by-a faction on the military
council.
The military council can count on little
backing from the armed forces as a whole.
There are serious disagreements within
the military, and the council's relations
with individual units are increasingly
strained. Most council members, in fact,
dare not return to their units for fear of
being detained. Indiscipline is widespread.
Many senior officers have been forced to
retire, and enlisted groups often decide on
their own whether to obey orders.
Most military unrest stems more from
practical grievances than disagreements
over political matters.
Ethnic Tension
The political turmoil in Addis Ababa is
intensifying frictions in the countryside.
Traditional antagonisms between the
large Amhara and Galla ethnic groups
have sharpened. The Amharas-and the
ethnically related Tigres-have
dominated Ethiopia's politics for
generations. In the armed forces, for ex-
ample, most officers are Amharas and
most enlisted men and noncommissioned
officers are Gallas. The less educated and
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 7 WEEKLY SUMMARY May 28, 76
 Approved For Release 20_/O ~ : CIA-RDP79-00927A011300220001-4
less affluent Gallas have long resented
Amhara domination.
The destruction of the old order has im-
proved the relative status of the Gallas, as
have the new rulers' efforts to improve the
lot of the disadvantaged. A majority of
the military council members, but not of
the powerful core group of key decision
makers, are Galla enlisted men and non-
commissioned officers, and Mengistu is
himself a Galla.
The Gallas'
prominence has
consciousness.
newly won political
increased their ethnic
Gallas on the council have placed a
large number of fellow Gallas in high
government offices and civil service
positions. Gallas in southern Ethiopia
have benefited most from land reform,
gaining control of land once owned by ab-
sentee Amhara landlords. Many alarmed
non-Gallas have come to view the revo-
lution as basically a Galla revolution.
The present radical line promotes Galla
ascendancy. Amharas believe, with some
justification, that Gallas predominate
among the leading leftist ideologues.
The council's plan to send thousands of
armed peasants into Eritrea Province to
fight secessionist guerrillas is viewed by
the Amhara as serving Galla interests.
The Amharas reason that Mengistu and
his Galla clique are deliberately fostering
Amhara-Tigre conflict by pitting the
peasants-mostly Amhara-against
Eritrean rebels, many of whom are ethnic
Tigres.
The use of the peasant militia also
suggests that the council is willing to at-
tack the Eritrean problem by setting
Christian against Muslim. Most of the
peasants are Christians; the rebels are
predominantly Muslim. Official media
over the past several weeks have waged a
propaganda campaign against the Arab
supporters of the Eritrean rebels in a way
clearly intended to fan traditional an-
ti-Arab and anti-Muslim sentiment
among Christians. The council may see
this as a way to reduce military discontent
over the Eritrean war.
Neither the Gallas nor the Amharas are
united behind any particular political
program or ideology. The Gallas are
themselves divided into diverse tribal
groups scattered throughout the country.
Some southern Galla, supported by
Somalia, have begun a guerrilla campaign
against the central government.
25X1
25X1
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 8 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/11/13 :JP79-00927A011300220001-4
Algeria's President Boumediene is faced with some in-
crease in domestic discontent, but his position still seems
secure. He has now launched a political process designed to in-
stitutionalize the political system and perpetuate his brand of
socialism.
7z- 77
Algeria: Boumediene's Domestic Position
I
Growing criticism o is foreign and
domestic policies and preparations for
long-awaited national elections have
spurred Algeria's President Houari
Boumediene increasingly to focus his
attention on domestic problems.
Boumediene lost prestige as a result of
the failure of his efforts to prevent the
take-over of Western Sahara by Morocco
and Mauritania. A general malaise has
begun to develop in Algiers.
As of now, however, Boumediene's
domestic position still appears strong, and
he has outlasted or suppressed his major
rivals. Of the original 26 members of the
National Council of the Revolution who
helped Boumediene seize power in June
1965, only nine remain active in national
affairs.
Boumediene, assisted by a small
number of advisers who vary according to
the issue under consideration, makes the
key decisions. The body charged with run-
ning Algeria-a plenary session of the
Council of the Revolution and the Council
of Ministers-ratifies and implements
decisions of the leadership.
Despite the growth of presidential
power over the years, the Council of the
Revolution apparently can assert itself.
Some decisions on the Western Sahara
issue may have been imposed on
Boumediene by the council. During the
unsuccessful week-long efforts in early
February by Egyptian Vice President
Mubarak to mediate the Moroc-
can-Algerian dispute, Egyptian officials
said Boumediene noticeably hardened his
position following consultations with the
council.
Reports of discontent among some of
Boumediene's key advisers have recently
become more numerous and may have
some basis in fact. Foreign Minister
Bouteflika and gendarmerie commander
Bencherif are frequently mentioned as
malcontents. Interior Minister
Abdelghani, military academy head
Colonel Yahiaoui, and Minister of In-
dustry and Energy Abdesselam are now
alleged either to be opposed to certain
Boumediene policies or to be on the outs
with the President for some other reason.
Some of Boumediene's advisers
probably are disgruntled because the
growth of presidential authority has
diminished their own roles, but none
appears to have the support to challenge
his supremacy. Chronic, sometimes bitter,
rivalries divide Boumediene's immediate
subordinates, and he is able to manipulate
these differences to maintain control.
Boumediene's ultimate base of support
is still the military. He has retained the
defense portfolio since assuming power
and has maintained close ties with fellow
military officers over the years. Rumors
of low morale in the armed forces,
however, are now more frequent. It seems
likely that Boumediene's pre-eminent role
in policy formulation on the Sahara issue
has produced some grumbling among
army officers that he has failed to consult
fully with the military.
The President is doubtless aware of
such grievances through a variety of
security channels as well as private con-
fidants. In the past, whenever criticism
has grown he has been able to contain it.
Signs of Discontent
Despite a continuing barrage of official
propaganda in support of Saharan
self-determination and the rebel Polisario
Front, the public generally has reacted
with apathy to the dispute with Morocco
over Western Sahara.
Some of Boumediene's advisers oppose
diverting scarce resources needed for
economic development to a cause that
does not appear to be making much
headway. It is unlikely, moreover, that
many Algerian soldiers have much taste
for becoming involved in a struggle that
they do not consider their own.
Mounting economic troubles, especial-
ly the failure of Algeria's much-vaunted
agrarian revolution, have also reduced the
regime's popularity. Algerian farmers
have shown a noticeable lack of commit-
ment to socialized agriculture.
Agricultural production has declined,
food imports have risen, the migration of
rural people to the cities has accelerated,
and an inadequate marketing system
produces sporadic food shortages.
Inflation has risen to the point where
the wholesale prices that farmers need to
meet costs are higher than the
government-controlled retail prices. The
country's ambitious economic develop-
ment program faces financing problems
and is beset with unfulfilled production
targets, long-delayed completion dates,
waste, and misplaced priorities.
On at least three occasions in the past
two months Algerian officials have com-
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 9 WEEKLY SUMMARY May 28, 76
 Approved For Release 200 h1dhVr: CIA-RDP79-00927A011300220001-4
DC /
plained to foreigners about Boumediene's
handling of the Sahara problem as well as
various domestic issues. Such open
criticism of government policies and
Boumediene's rule-especially to
foreigners-is new for Algeria.
In early March, four former Algerian
politicians who had been living in oblivion
for more than a decade distributed "an
appeal to the Algerian people," which
denounced the regime's policy of confron-
tation with Morocco over Sahara, called
for free elections and the establishment of
democratic institutions, and demanded an
end of Boumediene's personality cult.
Algerian dissidents in exile chimed in
with a flurry of statements of support for
the "appeal"; two or three of these tracts
have been smuggled into Algiers. Their
credibility among Algerians was weaken-
ed, however, by the fact that most of these
statements emanated from Morocco with
the knowledge and encouragement of the
Rabat government.
The regime reacted quickly. The four
authors were placed under house arrest
and apparently remain under close sur-
veillance. The government-controlled
media denounced them and the govern-
ment has subsequently called the dis-
sidents' appeal foreign-inspired and one
more example of the "imperialist" threat
to Algeria's revolution. Although there
has been little evidence of a positive reac-
tion to the appeal, the government was
clearly embarrassed and concerned by the
respectable nationalist credentials of its
signers and the fact that it surfaced inside
Algeria.
Boumediene Responds
Spurred in part by these developments,
Boumediene has been traveling around
the country boosting socialism, urging
vigilance against the "enemies of the
revolution," and calling on Algerians to
increase industrial and agricultural
production. The speeches are designed
both to refurbish his image as a leader
dedicated to the welfare of his people and
to warn any recalcitrants that socialist
Algeria is here to stay.
Boumediene is also preparing to in-
stitutionalize the political system. He has
initiated a lengthy political process that
will culminate in national elections. On
April 27, he announced publication of the
draft of a new national charter-a set of
governing principles-to replace the old
"Charter of Algiers" promulgated in
1964. The new charter is a status report
on the development of socialism in
Algeria and a prescription for the future.
Comments on the draft charter are be-
ing funneled upward through the National
Liberation Front-Algeria's sole political
party-the women's, labor, and youth
organizations, and local and provincial
assemblies. A final draft will be submitted
to a nationwide referendum.
Once the referendum is completed-
probably before the anniversary on June
19 of Boumediene's seizure of power-
a draft constitution will undergo a
similar process and will be submitted
to another referendum. Adoption of a
new constitution is to be followed in turn
by the election of a national assembly-
probably before national day celebrations
on November I-then by a presidential
election and, finally, a party congress.
Boumediene wants to put a stamp of
r A &. PAJ AD*.
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 10 WEEKLY SUMMARY May 28, 76
 Approved For Release 2006/11/1358P1P79-00927A011300220001-4
legitimacy on his government through
elections-but on his own terms. He en-
visions a governing apparatus that will
perpetuate his form of socialism.
It is clear that the Algerian leader does
not intend to share significant power with
a reconstituted national assembly and
that all candidates for this body, as well as
for the party posts, will be carefully
screened for their loyalty to Boumediene.
The subordination of the regime's official
party to the government apparently will
not change.
Boumediene intends to use the national
debate now under way and forthcoming
elections to create the appearance of pop-
ular participation in the governing
process. Despite his commitment to
socialist principles, he has generally
avoided curbing the interests of the
privileged elite, especially senior military
officers, many of whom have become
large landholders. So long as he continues
this pragmatic approach, Boumediene is
unlikely to encounter serious opposition
to the institutionalization of his regime.
Poland's trade deficits with the developed West and the
size of its debt-service payments have grown to the point that
Warsaw is trying to curb import growth. It may have to resort
to some domestic belt-tightening.
1 -1
Massive borrowing to purchase
Western machinery and flagging exports
to the recession-hit West place Poland in
an uncomfortable financial position. By
the end of last year, hard currency in-
debtedness had risen to $7 billion and the
debt-service ratio to 43 percent.
Poland has had mounting trade deficits
with the developed West between 1973
and 1975. Imports have more than tripled
because of above-plan purchases of
capital equipment, higher import prices,
and unanticipated purchases of Western
grain following poor harvests in 1974 and
1975 and Moscow's suspension of grain
deliveries in 1975. Exports doubled in
1973 and 1974, mainly on the strength of
higher prices, but the rise in 1975 was only
7 percent because of the Western reces-
sion, EC trade restrictions on meat im-
ports, and lower prices for copper, textile,
and wood.
Even though Poland's trade gap had
widened by the end of 1975, conditions
had begun to improve during the latter
g7, g, /
Poland: Growing Western Debts
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 11 WEEKLY SUMMARY May 28, 76
pc.T
 Approved For Release 2006MTCIA-RDP79-00927A011300220001-4
Meat factory at Elk: The US is one of the largest
importers of processed Polish meats
half of the year, reflecting curbs in im-
ports, particularly of cement and steel
products. The growth in the trade deficit
in the second half of 1975 was held to 17
percent, compared with 46 percent in the
first half.
To finance its trade deficits and rapidly
rising debt-service payments, Poland has
drawn heavily on Western official and
private sources. Medium-term and
long-term credits from Western
governments covered a large share of the
deficits from 1973 to 1975.
Non-governmental loans grew substan-
tially-from about $200 million in 1973 to
more than $1 billion in 1975. The need to
meet debt payments and down payments
on machinery purchased on supplier
credits forced Warsaw to rely more heavi-
ly on short-term financing in 1974 and
1975. Poland's debt maturity structure
thus has been shortened, and net
short-term liabilities now account for
almost two fifths of total net liabilities at
the end of 1975.
We estimate that the trade deficit this
year will hit $3.2 billion. Even though the
West is recovering from its economic
slump, Polish exports will not benefit ap-
preciably until late 1976 or early 1977. In
the first two months of 1976, Polish ex.-
ports to the developed West were 8 per-
cent below exports in the comparable
1975 period. Soft prices will hold down
earnings from exports of coal, sulfur, and
nitrogen fertilizer. EC trade barriers will
continue to hamper Poland's exports of
beef and bacon.
Polish imports most likely will continue
to grow in 1976, although at a slower pace
than in 1975. Poland still has to take
delivery of large amounts of Western
machinery and US grain it has ordered.
There are indications, however, that
Warsaw is seriously trying to curb import
growth. Citing the shortage of hard
currency, Warsaw has canceled $500-
million worth of projects that would re-
quire massive imports and has postponed
some purchases in the West, including
$80-million worth of US civil aircraft.
Poland is also taking an increasingly
tough stance on negotiations with
Western firms.
To cover its trade deficit and debt ser-
vice payments-the latter projected at
$1.5 billion in 1976-Warsaw will rely on
government-backed Western credits and
Eurocurrency credits. Poland has already
lined up $2 billion in government-backed
credits for use in 1976. Poland will also
receive $300 million in West German
credits and payments to the Polish pen-
sion fund under agreements signed last
year. Middle Eastern money could
provide additional financing, but Warsaw
so far has had little success in tapping this
source.
1'he government will find it increasingly
difficult to obtain untied financial credits.
Many Western banks have plenty of
money to lend, but bankers consider War-
saw in a tight situation and have adopted
a "very cautious" attitude toward further
lending. Poland now pays the highest
rates in Eastern Europe on its
Eurocurrency borrowings. Recent
attempts to arrange a $30-million loan to
finance grain purchases in the US have
been unsuccessful; Warsaw may have to
pay higher interest rates in order to at-
tract lenders.
Poland may be able to muddle through
until 1978 with the help of available
Western credits, a recovery in its export
earnings, and some form of domestic belt
tightening. Large trade deficits will none-
theless persist, and the debt-service
burden will increase as grace periods ex-
pire on previous loans. Although exports
will increase, their growth will be held in
check by capacity constraints, rising
domestic consumption, and the need to in-
crease exports to the USSR.
Poland's need to acquire hard currency
and maintain the flow of Western
technology will make it more flexible in
its economic relations with the West.
Warsaw, for example, recently reversed
itself and will now permit joint-equity
ventures with Western firms. A US group
has been granted approval to build and
operate a hotel-office building on this
basis.
Beyond 1978, Poland will find it less
and less feasible to live beyond its means.
The extent of its difficulties will depend on
how successfully it curbs import growth,
promotes exports to the West, pulls in its
belt domestically, and gets new con-
cessionary credits. The government
presumably fears that the imposition of
severe austerity measures would generate
an unacceptable level icdiscontent.
I I
SECRET
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Page 12 WEEKLY SUMMARY May 28, 76
 25X1 Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
 Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4
Secret
Secret
Approved For Release 2006/11/13 : CIA-RDP79-00927A011300220001-4