WEEKLY REPORT PREPARED EXCLUSIVELY FOR THE SENIOR INTERDEPARTMENTAL GROUP

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00826A002000010021-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 21, 2016
• Document Release Date: September 13, 2007
• Sequence Number: 21
• Publication Date: May 22, 1967
• Content Type: IR

Approved For Release 2007/09/13: CIA-RDP79T00826A002000010021-0
Secret
DIRECTORATE OF
INTELLIGENCE
Intelligence Report
Weekly Report
Prepared Exclusively for the
Senior Interdepartmental Group
State Dept. review completed
Secret
51
22 May 1967
No. 0411/67
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1. Hong Kong . . . . . . . . . . . . . . . . . 1
2. Venezuela . . . . . . . . . . . . . . . . . 2
3. Bolivia . . . . . . . . . . . . . . . . . . 3
4. Laos . . . . . . . . . . . . . . . . . . . . 4
5. Sudan . . . . . . . . . . . . . . . . . . . 5
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Peking directly involved itself in Hong Kong's
volatile labor troubles by issuing a Foreign Minis-
try statement on 15 May demanding that the British
accept all Hong Kong union agitators' demands.
This was followed by harassment of British diplo-
mats in Peking and the forced closure of the UK
consular office in Shanghai. Chou En-lai and
other top leaders attended a massive anti-British
rally in Peking on 18 May, and there were numerous
smaller demonstrations in Kwangtung Province bor-
dering the colony.
As a result of encouragement and support from
Peking, violence in Hong Kong has risen sharply.
The Chinese are probably motivated by a desire to
undercut British authority and to expand their own
base of popular support in the colony. Their suc-
cess in humiliating the Portuguese in Macao last
winter may also have encouraged them to challenge
the British.
It remains unclear how far Peking is prepared
to go in the current test of strength. A probable
key limiting factor is the $550 million worth of
foreign exchange earned through Hong Kong last
year. The Chinese, however, may believe they can
considerably increase the pressure on the British
without serious risk to their own economic interests.
With the police in Hong Kong taking stronger
action and harassment of British diplomats failing
to achieve results, Peking may now curtail food
and water supplies from the mainland.
London anticipates a long war of nerves and
believes Hong Kong is in for a rough time. It
seems determined not to give in, however, appar-
ently believing that a stronger line would have
served the Portuguese better in the Macao dispute.
If the crisis worsens, London may ask what
assistance the US can provide, particularly should
an evacuation of personnel from the colony be re-
quired. The British may also ask that the US at
least temporarily suspend use of Hong Kong for
rest and recreation purposes. Finally, the British
might seek to curtail Chinese Nationalist activi-
ties in the colony.
22 May 1967
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Venezuela has swung into high gear in its
campaign against Cuban aggression. In addition to
a condemnation of Cuba by the Organization of
American States (OAS), President Leoni wants to
take more direct action.
He suggested to Ambassador Bernbaum that the
United States impress on the Soviet Union the
gravity and danger of Cuba's actions and exert
pressure to get the USSR to intervene with Castro.
At the same time, Venezuela would let the USSR
know "categorically" that relations cannot be
considered so long as the USSR supports Castro.
He also urged that US unions be encouraged to
boycott shipping lines doing business with Cuba
and that firms trading with Cuba be black-listed.
The Confederation of Venezuelan Workers has
already announced that beginning in June Venezuela
will boycott ships of countries which trade with
Cuba. Venezuela has asked Yugoslavia and Poland,
with which it maintains relations, to intercede
with Cuba and the USSR to end subversion in
Venezuela.
There is some pessimism in Venezuelan government
circles, as well as among OAS member states, that
these measures will really be effective in ending
Cuban support to the guerrilla movement. The ambush
of an army convoy on 17 May in the mountains near
the site of the recent guerrilla landing, and Cuba's
statement that it was responsible for the landing
and will continue to support insurgency, give addi-
tional grounds for pessimism.
SEU E'I
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3. BOLIVIA
The insurgent situation in southeast Bolivia
after two months of activity has settled down to a
standoff between the army and the guerrillas.
Although greatly outnumbering the insurgents,
the ill-trained and poorly equipped army forces can
do no more than maintain sporadic contact with the
insurgents. They are not expected to achieve an
effective combat capability until at least the end
of 1967, when the MAP-supported Second Ranger
Battalion completes its training.
Pressed by the public and his advisers to obtain
immediate favorable results, President Barrientos'
concern is to achieve a spectacular victory over
the guerrillas. All his proposed solutions, how-
ever, rest on equipping Bolivian forces with modern
weapons without regard for the need of concurrent
training or for logistic requirements.
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Prime Minister Souvanna's success in electing
a more amenable National Assembly early this year has
not yet led to substantive progress in resolving
long-standing political problems.
The spirit of cooperation between regional family
and military factions which seemed to be emerging
after the election has diminished as Souvanna has
sought to implement his oft-stated political goals.
The reassertion of long-standing factional suspicions
and Souvanna's failure to win backing for a broad-
based "united front" have forced him to abandon all
but the least controversial governmental changes.
One of the current unresolved problems is the
reorganization of the cabinet. Although there is
common agreement that changes must be made, Souvanna
has found it difficult to make ones which will be
acceptable to conflicting regional interests. He
is particularly interested in getting rid of Deputy
Prime Minister Leuam Insisiengmay, an obstreperous
rightist. His efforts to replace Leuam have
foundered on the refusal of southern leader Boum
Oum to see his protege demoted.
Souvanna has also attempted to remove from
Vientiane the left-leaning neutralist, Information
Minister Pheng Phongsavan, long a target of rightist
assembly deputies, by naming him ambassador to Moscow.
His move was complicated by the cool Soviet response
to Souvanna's intent to name the outgoing ambassador,
rightist Khampan Panya, to the position of foreign
minister. Unable to make these desired changes,
Souvanna will reportedly content himself with filling
certain minor subcabinet positions and will retain
the foreign minister's portfolio himself.
Other political problems, such as the designation
of a future successor to Souvanna, have been placed in
abeyance for the present because of the regional
hostilities which they generated. Souvanna is sensi-
tive to the fragility of his present alliance with
key military commanders. His awareness of the danger
in pressing changes too vigorously will probably
cause him to pursue a cautious course in the coming
months.
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5. SUDAN
The Sudan entered a new phase of political
uncertainty last week with the ouster of moderate
Prime Minister Sadiq al-Mahdi and his mildly pro-
Western government.
Mohammad Mahjoub, a member of the opposition
group within Sadiq's own conservative Umma Party,
was chosen to head a new interim government which
will rule until a new constitution can be adopted
and elections held. Although Mahjoub himself
probably will not undertake any drastic revision
of the Sudan's current moderate pro-Western poli-
cies, the cabinet will almost certainly include
representatives from leftist-oriented political
groups who could exert disproportionate influence
on Mahjoub.
Sadiq will probably now concentrate on building
up support for his candidacy in the elections.
Meanwhile, the army is watching the situation
closely. Should the Mahjoub government fail to
make progress toward establishment of the permanent
constitution because of interparty and personal
bickering, and should public unhappiness increase,
some military group might feel compelled to ste
in and take over the government.
22 May 1967
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