LATIN AMERICAN TRENDS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A002300400001-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 22
• Document Creation Date: December 12, 2016
• Document Release Date: July 22, 2002
• Sequence Number: 1
• Publication Date: December 17, 1975
• Content Type: NOTES

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Secret
Latin American Trends
I ES
ARCHIVAL RECORD
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Secret
December 17, 1975
No. 0540/75
PLEASE R.ET J E " TO
AGENCY ARCHIVES, 2,960 25X1
State Dept. review completed
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S E C R E T
LATIN AMERICAN TRENDS
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CONTENTS
December 17, 1975
Argentina: Combatting the Terrorists ., . . . 1
Bolivia: Business as Usual . . . . . . . . . 3
Brazil: Foreign Policy Angers
Military . . . . . . . . . . . . . . . . . 5
New Challenges for Latin Solidarity . . . . .
Venezuela Plans Shift to Petrochemical
Exports . . . . . . . . . . . . . . . . . .
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Guatemala: Political Assassination .
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ANNEX
Trinidad and Tobago on the Eve of an
Election Year . . . . . . . . . . . . . . . 17
Editor Note: The Latin American Trends will not be
published on December 24. Publication will resume
on December 3Z. Merry Christmas!
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Argentina:
Combatting the Terrorists
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Nonetheless, guerrilla optimism is by no means
unfounded. The Montoneros, for example, have operated
virtually at will for a number of years, and the armed
forces' highly visible campaign over the past two
months does not appear to have reduced the guerrillas'
overall capability, despite government claims of success.
Indeed, in the past two weeks, the guerrillas have gone
on the offensive with another rampage that has included
the killing of a retired general, attempts against
others, and the kidnaping of yet another Argentine
business executive for ransom. The latest activities
seem aimed at humiliating the armed forces and provoking
harsh counter-measures that will gain them wider public
sympathy.
The Montoneros in particular possess a high degree
of motivation and discipline, huge financial resources,
and good training. But, unlike the other principal
extremist group, the Marxist Peoples Revolutionary Army,
the Montoneros claim to be the true embodiment of
Peronism, an ill-defined set of beliefs whose hold on
the Argentine people many fear to challenge. Indeed,
many more conventional Peronists still do not consider
the Montoneros completely beyond the pale, despite
their tactics. As long as this is so, the authorities
are unlikely to wage a completely unrestrained campaign
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on all fronts against this, the most significant of
the terrorist groups. In the final analysis, the
military may remain content to approach the Montoneros
on a strictly military basis, attacking their camps
and interrupting supply lines, recognizing military
inability to blunt the appeal of such groups short of
reordering all aspects of national life.
To view the guerrillas as a purely military threat,
however, is to ignore and perhaps even enhance the
factors that make adherence to the groups attractive.
The dissidents draw on the sons and daughters of re-
spectable citizens for support and are well in touch
with--and able to play on--the hopes and frustrations
of this largely middle-class nation. Many young
Argentines see the guerrilla movement as the only way
they can personally have a hand in changing a highly
corru t: ineffectual
For some time to come the armed forces will continue
to face a particularly galling dilemma. On the one
hand, as security elements, they cannot wholly ignore
the presence of violent insurgents. At the same time,
however, they seem unable to wage all-out war because of
the continuing public sympathy for the guerrillas.
Moreover, the military realize that by being repressive
enough to: rout the guerrillas, they could well engender
the widespread popular repudiation that the guerrillas
hope to provoke.
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Bolivia: Business as Usual
President Banzer, as yet unable to demonstrate
any positive progress toward his pledged goal of re-
gaining Bolivia's access to the sea, may be attempt-
ing to divert public attention by engaging in one of
his periodic exercises to give a semblance of activity
and progress.
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The government announced with fanfare on December
11 the discovery of an "international conspiracy" and
the capture of leftist subversives in Cochabamba who
had been plotting the overthrow of the Banzer regime.
The subversives, who had planned to carry out strikes,
sabotage, and terrorism, were allegedly counting on as-
sistance from organized cells within the mining areas
and in various factories.
The Banzer regime has been known to have created
fictitious subversive threats in order to shore up
public support, but the current group, although small,
appears to be a bona fide terrorist organization. How-
ever, little evidence has surfaced indicating widespread
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local support or sympathy. The government appar-
ently knew of the group's existence and may have made the
arrests some time before announcing them, possibly
as a ploy to justify a decrease in the number of
political prisoners to be released under the usual
Christmas amnesty.
President Banzer has weathered the vicissitudes
of four years in office and does not seem disposed to
step down at this time. The illusion prevails that
progress is being made, but for the most part it is
window dressing.
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Brazil: Foreign Policy Angers Military
A number of senior military officers reportedly
are upset with Brazil's recent foreign policy decisions
to support the anti-Zionist resolution in the UN and to
recognize the Soviet-backed Popular Movement as the
legitimate government of Angola.
I the army general
staff has rejected explanations by a senior foreign
ministry official. The generals appear especially
outraged by the diplomatic action on Angola. They ap-
parently were not consulted and argue that the Soviets
will probably attempt to establish military bases in
Angola and make the South Atlantic a contested region.
Foreign Ministry Silveira so far has not publicly
defended the foreign policy actions. He weathered
similar attacks last year for recognizing the Peoples
Republic of China and for tilting toward the Arabs.
We see no sign that Silveira intends to alter his ap-
proach to foreign policy, and he apparently still
enjoys the confidence of President Geisel.
Silveira's highly nationalistic posture, which
often spills over into anti-US positions, has won him
credit with the generals and enabled him to get away
with actions that otherwise would rankle them. Some
of his most controversial policies seem to have been
undertaken--at least in part--for the purpose of as-
serting Brazil's independence in foreign affairs.
The Geisel administration has had its share of
reversals this year, and it would suffer a further
setback if a majority of the high command lined up
against Silveira on a particular policy issue.
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New Challenges for Latin Solidarity
Two recent US initiatives may be interpreted by
the strong advocates of Latin unity as "divide and
conquer" tactics. Venezuela, Mexico, Peru, and
Panama, all careful to monitor situations in other
Latin capitals, seem likely to be concerned over the
mixed Latin reaction first to US criticism of draft
amendments to reform the organization of American
States, and second, to Washington's new list of prod-
ucts covered under the Trade Reform Act's generalized
system of preferences.
US displeasure with the results of a three-year
effort to modernize the OAS charter has evoked sympathy
from some governments and outrage from others. The
small countries friendly to the US, such as Uruguay and
Costa Rica, value US protection they gain in the inter-
American system and want to be as constructive as pos-
sible in order to maintain Washington's participation
in the OAS. Brazil, Argentina, Colombia, and Chile are
all inclined to agree with the US assessment of the
poor quality of the reform effort but can anticipate
the frustration and impatience that would result if it
were dumped. They prefer to use the existing drafts as
the basis for negotiating further revision.
Peru and Panama have led the attack on the US
position and are assailing Washington's effort to
"sabotage" the reform effort. The press in those and
other countries has assumed that the US no longer finds
the OAS "useful" because of Washington's inability to
impose its will on the rest of the hemisphere through
the inter-American system. An Ecuadorean diplomat,
sounding a theme common throughout much of the region,
told US officials that Latin members of the OAS are
frustrated by US indifference to Latin America and
Washington's resistance to committing itself to acts
that would seem responsive to the region's needs.
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Latin governments are also giving close exami-
nation to the newly authorized list of products to
receive preferential access to the US market. They
regard US trade regulations as an important indicator
of US sympathy toward their development aspirations.
Whether the exclusion of the area's two OPEC members,
Venezuela and Ecuador, will stimulate broad regional
criticism of US trade policy will probably turn on how
beneficial or disappointing the other governments find
the list for their own countries. Several have reacted
favorably to US assurances that the new list will help
their export situation but they intend to scrutinize it
carefully and make their independent analysis of what
its impact will be.
Venezuela and Ecuador are angry over their continued
exclusion from the preference scheme and Ecuador has also
criticized the list's inclusion of too few products.
Panama has succeeded in putting the trade act on all
future agendas of the OAS permanent council until the
discriminatory exclusions are ended. One Ecuadorean made
.the point that Quito complied with the US request for
support on Korea in the UN because the issue was labeled
of US "vital interest;" but the "reciprocity" Ecuador
received a few days later was reaffirmation of its exclu-
sion from the trade preferences.
A Bolivian official believes that the Latin nations
will probably want to meet in some forum to discuss the
product list. It seems likely that Venezuela is making
representations throughout the area to garner support for
such a session. On the issue of OAS reform, various sug-
gestions of how to handle that problem have been offered
by different governments and it seems likely that some
special meeting will be designed to address the future
of inter-Americanism.
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Venezuela Plans Shift to Petrochemical Exports
In the next few weeks Caracas will formally an-
nounce a $2.4 billion plan to develop an export-
oriented petrochemical industry by the mid-1980s.
The government hopes to sell petrochemicals in the
US and other Western Hemisphere markets, where
Venezuela would have a transportation advantage
over potential Middle East producers. The long-term
world market outlook for petrochemicals is neverthe-
less uncertain because other OPEC countries also plan
to develop similar industries. Realization of all
these plans could result in worldwide overcapacity
in the 1980s.
The petrochemical sector is to be a priority
target for economic development. Caracas is anxious
to reduce Venezuela's overwhelming dependence on
exports of crude and fuel oil, which account for 87
percent of total export earnings, by expanding exports
of higher valued products. In this way Caracas seeks
to husband its conventional oil reserves, which will
last only about 14 years at current production levels.
To manage the program, the plan calls for estab-
lishment of a government-owned holding company similar
to Petroven, which was set up to supervise the national-
ized petroleum industry. Caracas hopes to set up sub-
sidiary joint ventures with foreign firms to acquire
advanced technology and to ensure markets for Venezuelan
petrochemical products. Talks are under way with sev-
eral US and West European firms, and Caracas hopes to
announce some agreements by the end of the year.
Caracas faces some difficult hurdles in implement-
ing the plan. Strong leftist opposition to foreign
management of government-owned companies could hinder
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the effective organization of the ailing 22-year-old
state petrochemical company, which will be the nucleus
of the industry. In addition, Caracas will be pinched
for funds in coming years as rising imports and near-
stagnant oil revenues put its current account balance
in the red. Ambitious development plans in other
sectors, such as steel, will also make heavy demands
on financial resources and Caracas will have to decide
whether to borrow abroad or set new priorities for its
limited funds.
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Guatemala: Political Assassination
A minuscule leftist terrorist group, known as
the Guerrilla Army of the Poor, has claimed credit
for killing a right-winq congressman on December 12
together with his bodyguard and chauffeur.
The killing was the first political murder of
any prominent person claimed by leftist guerrillas
since President Laugerud took office in July 1974.
The victim was Jorge Bernal Hernandez, the congres-
sional leader of the National Liberation Movement,
part of the governing coalition. Hernandez, a man
who had enemies across the entire political spectrum,
had a checkered political career that may have direct-
ly contributed to his death. He was a left-wing
guerrilla himself in the early 1960s. Captured by
the army in 1967, he defected from the guerrilla ranks
and went on to become former president Arana's per-
sonal. bodyguard. Arana chose him to run for Congress
in 1974. Hernandez was reputed to be Vice President
Sandoval's henchman in carrying out acts of govern-
ment violence in the early 1970s.
Little is known of the Guerrilla Army of the
Poor other than that it probably has no more than
15 to 30 members. It may be identical to a group
that split away from the Rebel Armed Forces in mid-
1973. According to messages it has occasionally
sent to newspapers, the group says it is responsible
for many kidnapings, attacks, and killings of land-
owners and businessmen in the country's interior.
In late November its members claimed they had killed
19 military commissioners, civilians authorized by
the military to carry weapons and assist in local
law enforcement, in the eastern department of Chi-
quimu.la, Hernandez' home district. Military com-
missioners have been notorious for their involvement
in political murders.
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The killing will test the Laugerud government's
efforts to decrease its own use of violence to elim-
inate opponents. Since the first of the year political
violence by the government and the left has lessened
noticeably, but the Hernandez murder could set off
a new cycle of terror and counter-terror.
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Trinidad and Tobago on the Eve of an Election Year
As political manuevering begins in Trinidad in
preparation for elections that are to be held next
year, the Latin American Trends offers a synopsis of
a recent assessment of the current situation by US
Charge Robert Rich.
The Distinctiveness of Trinidad in the Caribbean
Pre-eminently in the English-speaking Caribbean,
Trinidad and Tobago today has immediately exploitable
resources and economic options. A racially mixed
society, it enjoys a remarkable degree of racial har-
mony and there is no extreme spread of social classes
to fuel highly radical politics. Trinidad's own per-
ception of its natural leadership position is only be-
grudgingly accepted by its CARICOM partners, and then
mostly because Trinidad's money is needed. Prime
Minister Eric Williams, in many respects the senior
politician of the region, no longer commands instant
respect from his neighboring colleagues, who are un-
comfortable with his automatic assumption of the pater-
nal role and find relationships strained from the per-
sonal political clashes of two decades.
Trinidad finds itself in a highly favored position
from a developmental standpoint. Only slightly more
than two years ago, the economy was drifting toward
stagnation. Today, the revenue picture is completely
different, with the government anticipating revenue of
US $700 million per year over the next five years.
Petroleum wealth gives the country economic options and
correspondingly increases the stakes of political power.
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An energy-based industrialization program is in the
offing, although heavy unemployment continues to cloud
the future.
The Peoples National Movement (PNM), under the
leadership of Dr. Eric Eustace Williams, has full con-
trol of the organs of government and easily has the
best organized political machinery in the country. Its
grass roots organization and patronage system have
dominated the political life of the country for twenty
years. In many respects the government is Williams,
and the close rein on which he holds most of his cabinet
is legendary.
Williams is vulnerable, however. His once powerful
charisma is rarely evident at all today. Cyclical periods
of retreat and inaction, coupled with unconfirmed reports
circulating of more serious medical problems, naturally
give his advancing age a less dynamic cast. More impor-
tant, he seems to have lost contact with the young, and
missed the fact that a generation change has quietly
been taking place in Trinidad since he came to power in
1956.
The Political Opposition
The disarray and fragmention of the opposition has
been a paramount factor in recent years. The Peoples
National Movement (PNM) no longer commands the support
of the majority of the electorate, but it will have no
great trouble in winning a strong plurality unless a
truly remarkable degree of last-minute unity can be
achieved among the opposition parties.
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The surprising fact is that almost throughout
the serious opposition there is a sense of responsi-
bility and dedication to democratic institutions.
None of the parties advocates abolishment of private
property or of free elections. Economically the
argument is over what kind of mixed economy should
evolve.
While almost all opposition political parties
are talking unity, at this stage this largely means
each is seeking a coalition on its own terms and with
itself in the leadership position.
The East Indian voter has traditionally turned
to the Democratic Labor Party at election-time as the
defender of East Indian rights against what is usually
viewed as a Negro-dominated Peoples National Movement.
With the East Indian population now generally conceded
to have caught up with the Negro population in numerical
terms, the Democratic Labor Party constituency is poten-
tially quite powerful. However, no really strong ethnic
leader has emerged to galvanize the East Indian voter.
Nevertheless, with the knee-jerk vote of many uneducated
East Indians, the Democratic Labor Party today is the
one essential coalition partner of any opposition party
that might win.
The United Political Front has captured consider-
able imagination among younger Trinidadians, as a pos-
sible real inter-racial political coalition. It is
the outgrowth of a highly political joint labor strug-
gle in the spring of 1975 involving the largely Negro
Oilfield Workers Trade Union under veteran unionist
George Weekes, the East Indian sugar workers led by
Hindu barrister Basdeo Panday, and the cane farmers
under Moslem ex-army lieutenant Raffique Shah. While
Basdeo Panday is the obvious intellectual leader of the
front, he says he feels the country is not ready for an
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East Indian prime minister. He is confident that the
Democratic Action Congress will join in a coalition
led by the United Political Front on the understanding
that its leader, former Williams associate A.N.R.
Robinson will be the coalition's candidate for prime
minister. The achievement of such a coalition will
be elusive, but it is being actively pursued and if
effected would be the closest to a grand coalition of
opposition groups likely to emerge.
In some respects Tapia is the most interesting of
the opposition groups, if only because of the intel-
lectual sophistication of its leadership and the dedi-
cated manner in which it actually pursues issues and
debates national policy with the government. There is
little evidence, however, that Tapia has a sufficiently
strong grass roots constituency to hope to form a govern-
ment on its own. Of all the significant opposition
groups, it seems least likely to become a partner in an
effective coalition. Perhaps the significant question
is whether the Tapia campaign will hurt the Peoples
National Movement or other opposition parties the most.
I suspect it will tend to divide the opposition vote
more than it will draw from the PNM side of the fence.
Prospects and Predictions
Trinidad and Tobago has not really yet had its post-
independence shake-out, but this may now be in sight.
Williams will almost certainly be returned as prime
minister, but it is difficult to envisage him remaining
for a full new five-year term. Next year or the year
after, he will probably step down. The future alter-
natives are probably: a) more of the same; b) a coali-
tion government; or c) radical economic nationalism. Of
the three, a coalition that would provide some conserva-
tive continuity yet capture the impetus to change is the
most likely.
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The next five years will be a significant transi-
tion period for this country. If government or opposi-
tion elements cannot sufficiently capture the hopes of
the young electorate in the 1976 election, the future
of the democratic institution itself could be threatened.
The election of 1976 therefore may say much about whether
the end of the decade in Trinidad will exhibit a
strengthened political process or radical violence--
racial polarization or increasing harmony. The most
likely outcome is that Trinidad and Tobago will achieve
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