INTERNATIONAL ISSUES REGIONAL AND POLITICAL ANALYSIS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00912A002300010002-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 43
• Document Creation Date: December 20, 2016
• Document Release Date: May 31, 2006
• Sequence Number: 2
• Publication Date: April 20, 1977
• Content Type: REPORT

Approved For Release 200777 -RDP79T00912A00230001'0002-2
r
International Issues
CNAL AND
ICAL ANALYSIS
State Dept. review completed
t
Secret
RP All 77-04
20 April 197
25X1
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 25X1 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
25X1
INTERNATIONAL ISSUES
20 April 1977
CONTENTS
Impact of the US Stand on Human Rights . . . . . . . 2
Brazilian Nuclear Intentions . . . . . . . . . . . . 15
The Politics of the G-77: Near-Term Implications
for the North-South Dialogue . . . . . . . . . . . 21
Less Developed Country Demands for Technology
Transfer . . . . . . . . . . . . . . . . . . . . . 28
The North-South Dialogue and Indonesia . . . . . . . 33
UN Water Conference . . . . . . . . . . . . . . . . 36
This publication is prepared by the International Issues Division, Office of Regional
and Political Analysis, with occasional contributions from other offices within the
Directorate of Intelligence. The views presented are the best judgments of individual
analysts who are aware that many of the issues they discuss are subject to alternative
interpretation. Comments and queries are welcome. They should be directed to the
authors of the individual articles.
RP All 77-004
20 April 1977
Approved For Release 2007/03 WREQIA-RDP79T00912A002300010002-2
 25X1 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
25X1
Impact of the US Stand on Human Rights
Initial international skepticism about the serious-
ness of the new US administration's commitment to the
fostering of human rights has been dispelled by presi-
dential statements and US initiatives in bilateral rela-
tions and international forums. Considerable confusion
and suspicion over US motives persist, however, and there
is apprehension over the lengths to which the US may be
prepared to go in pursuit of human rights objectives.
This article first assesses regional reaction to the US
stand and then explores implications and prospects.
Introduction
The administration's stand on human rights has spear-
headed efforts to reexert US moral leadership in world
affairs. It has focused international attention on the
issue, stimulated thought and debate, and increased pop-
ular awareness. The US stand has been heartening to
many of those who feel oppressed by tyrannies of either
the right or left. Expansion of the horizon of the UN
Human Rights Commission beyond its limited list of usual
concerns in response to US initiatives could serve as a
first step toward more meaningful work by that organi-
zation.
US initiatives, moreover, have prompted several
governments to move toward bettering their human rights
performance. This has occurred principally where the
regime has been anxious to preserve cooperative relations
with the US, has not felt publicly challenged or specif-
ically pressured by Washington, and is relatively confi-
dent about its internal security situation.
RP All 77-004
20 April 1977
Approved For Release 200 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
Even in these cases, however, there has been a nota-
ble reluctance to accept the US stand at face value.
Public expressions of understanding about US concerns
have been matched by private assessments of Washington's
emphasis on human rights as a ploy designed to prod other
countries into comporting themselves in accordance with
US policies generally.
Attribution of such ulterior motivation, the connec-
tion of human rights to other issues, and a marked pro-
pensity to interpret US pronouncements and actions in
egocentric terms have been characteristic reactions of
countries with the most cause for unease over the US
stand. Repressive practices have intensified in some
cases, and bilateral relations have suffered in a number
of instances.
There is enthusiastic support for the US stand in
some countries, but in many cases it is coupled with
considerable worry over the potential for adverse inter-
national political consequences. Applause for Washing-
ton's espousal of human rights principles, therefore,
is not always accompanied by approval of specific US
initiatives.
A broad range of political relationships important
to the US thus has been complicated by the addition of
what many foreign observers view as a new element of
uncertainty in international affairs. The ensuing dis-
cussion explores the impact that the US stand has had on
human rights practices and international politics in
more detail, and examines some implications for the
future.
The Communist World
The Soviets, perplexed and concerned over Washing-
ton's human rights initiatives, tend to view the US stand
as aimed primarily at them. Even sophisticated Soviet
observers reportedly suspect US actions are part of a
campaign to undermine their political system. The So-
viets may choose to cite lack of US criticism of China's
human rights record in support of this interpretation.
RP All 77-004
20 April 1977
-3-
Approved For Release 2007/033Q CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECR ET
Moscow already seems reconciled to tY fact that--
contrary to its previous expectations--this is unlikely
to be a banner year in Soviet-US relations. The Soviets
have protested vehemently that certain actions related
to human rights constitute unacceptable interference in
their internal affairs, and there have been numerous
warnings that bilateral relations could suffer serious--
though unspecified--damage as a result of the US stand.
Thus far, however, the Soviets have limited themselves
to reactions deemed sufficient to make their points
without severely damaging ties with the US.
Hints at the possible spillover of Soviet displeasure
into SALT, for example, continue to be accompanied by ex-
plicit signals that SALT is a separate issue where prog-
ress can be achieved. The human rights controversy com-,
plicated the recent SALT negotiating session, but by no
means did it foredoom Secretary Vance's mission. Had
the substance of US proposals been more to the Soviets'
liking, they undoubtedly would have reacted accordingly-.-
despite their annoyance with the US over the human rights
issue. Nevertheless, at least for tactical reasons, they
are likely to continue to point to the US human rights
stand as a major impediment to progress on the whole
range of bilateral issues.
Moscow is anxious to disabuse the US of the notion
that public urgings on human rights will help Soviet
dissidents and to convince the dissidents that pleading
their cause to the West will be counterproductive. Some
of the dissidents have reportedly been encouraged by US
initiatives despite the fact that they anticipate inten-
sification of repressive measures in the immediate future.
Approval of the US stand among Soviets interested in
bringing about changes in their society tends to vary
directly with the degree to which they feel alienated
from the system.
Moscow is eager to make the revolution's 60th anni-
versary in November and the events leading up to it
bright landmarks in Soviet history and is concerned that
the celebrations could be tarnished if the West vigorously
presses the issue of "Basket III" (human rights) imple-
mentation at the Belgrade CSCE meeting that begins in
June. Efforts to stifle dissident activity before and
RP All 77-004
20 April 1977
Approved For Release 2007/gETCIA-RDP79T00912A002300010002-2
 Approved For Release 2007/0,jR CIA-RDP79T00912AO02300010002-2
during the CSCE sessions are likely to coincide with the
dissidents' own realization that it is a propitious time
internationally to publicize their various causes. The
dissidents also realize, of course, that the risk to
individuals of regime reprisals has increased as well.
Soviet authorities already have significantly in-
creased pressure on the dissidents, and attempts to in-
timidate them through arrests and threats will continue.
There are indications that where dissidents actually are
brought to trial, Moscow may try to blunt accusations of
human rights violations by forgoing political charges
(e.g., anti-Soviet agitation and propaganda) and concen-
trating on criminal counts, such as currency offenses.
Another serious worry for Moscow is that agitation
over human rights could exacerbate existing or anticipated
control problems in Eastern Europe, especially in Poland,
and to a lesser extent in East Germany. Like the Soviets,
the East European regimes seem puzzled by the US stand
and somewhat off balance.
There is disagreement within and among the East
European regimes on their most immediate problem: how
to handle the most serious wave of dissident activity in
the last several years--activity that promises to become
bolder as the CSCE meeting approaches. Regimes with the
least serious dissident problem (i.e., Hungary) or who
believe a hard line would be counterproductive in their
particular circumstances (i.e., Poland) have been resist-
ing pressure from the Soviets for a crackdown. They
have been arguing that party leaders in individual coun-
tries are in the best position to determine a proper
course of action in light of local conditions. Thus far,
the Soviets appear to have listened to these arguments
and tolerated some measure of diversity in handling
dissent. There is no evidence so far that the US human
rights stand has had a significant impact on the tactics
of the East European regimes for dealing with their dis-
sidents.*
RP All 77-004
20 April 1977
Approved For Release 2007/03W ?CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03478 PfA-RDP79T00912A002300010002-2
The East Europeans do seem genuinely worried, how-
ever, over the possibility of US human rights initiatives
provoking Soviet movement away from detente and over the
adverse implications such a development would have for
them both economically and politically. The East Euro-
pean press has been highly critical of the US stand and
has counterattacked with condemnations of alleged injus-
tices in the US and US disregard for "economic and social"
rights. This type of criticism has become more pointed
since a meeting of Warsaw Pact party secretaries in early
March, undoubtedly reflecting a decision to harden the
propaganda line.
China is the only Communist country that seems to
have derived some satisfaction from the US stand. Peking
clearly has taken heart from recent difficulties in US-
Soviet relations, and the Chinese see Washington's atti-
tude on human rights as possibly signaling a toughening
US stance toward Moscow generally. The Chinese thus far
appear unconcerned about their own vulnerability on the
human rights issue, but Peking probably has some private
misgivings on this score. This may explain the failure
of Chinese media to highlight the human rights controversy
despite Peking's usual penchant for emphasizing US-Soviet
differences.
Indeed, initial Chinese enthusiasm may have been
tempered by realization that the status of human rights
in China could become a controversial issue in the US
and complicate the process of normalizing Sino-US rela-
tions. The "freedom of emigration" provision of the
1974 Trade Act could, for example, adversely affect US
extension of Most Favored Nation status to Peking. The
Chinese may also be concerned over the Soviets' increas-
ing their influence at Washington's expense among third
world countries offended by US human rights initiatives.
The Industrial Democracies
There is broad approval in principle of the US human
rights stand in Western Europe, Canada, and Japan. A
joint declaration of the European Parliament, the EC
Council, and the EC Coirunission signed early this month
strongly reaffirmed the signatories' commitment to the
enhancement of fundamental rights and individual freedom.
RP All 77-004
20 April 1977
Approved For Release 2007/0?k~tIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/017CFGIA-RDP79T00912A002300010002-2
Among the industrial democracies, however, there is also
a strong inclination to temper actions based on such dec-
larations with practical considerations.
Leaders of these countries tend to define interna-
tional issues on which the US takes a comprehensive global
approach in more parochial terms. Thus, the Europeans see
the human rights issue mainly in terms of East-West rela-
tions while the Japanese are primarily concerned with how
the US stand will affect US policy and Japanese interests
in Asia.
The Europeans are concerned that US human rights
initiatives risk causing--perhaps in ways now unforeseen--
a deterioration in East-West relations that would have a
more damaging impact on Western Europe than on the US.
As a result, government leaders have displayed a decided
preference for pursuing human rights objectives with
quiet diplomacy and behind-the-scenes approaches.
Britain's Prime Minister Callaghan may have indicated
to the, Soviets that the strong speech on human rights
delivered by Foreign Secretary Owen in early March did
not herald a major change in UK policy. French officials
reportedly are worried about preserving what remains of
the Franco-Soviet "special relationship," and they are
anxious to maintain a propitious atmosphere for Brezhnev's
coming visit to Paris. Traditional reluctance to appear
to be following any US lead may also figure in France's
reticence. In Germany, Chancellor Schmidt has declared
that Bonn will seek to advance the cause of human rights
in its own--i.e., low-key--way.* Among the smaller West
European nations, willingness to be outspoken on the
human rights issue seems to vary inversely with physical
proximity to the Soviet Union.
Latin America
US human rights initiatives have aroused consider-
able resentment in several Central and South American
25X6
RP All 77-004
20 April 1977
Approved For Release 2007/03/BST'.1IA-RDP79T00912A002300010002-2
 Approved For Release 200717E-r CIA-RDP79TOO912AO02300010002-2
countries ruled by military regimes that have felt di-
rectly challenged. They have denounced US statements
and actions as unwarranted and unacceptable interference
in strictly internal affairs.
Argentina and Uruguay rejected all US military as-
sistance after Washington linked aid cuts to human rights
violations in those countries. Brazil, already angered
by US pressure to modify its nuclear deal with West Ger-
many, condemned the State Department's preparation of a
report on its human rights practices* as an affront to
its sovereignty and renounced the 1952 military assist-
ance agreement. Guatemala and El Salvador have also
rejected military assistance conditioned on US judgment
of their human rights situations.
The 'Latins are angered by what they regard as US
failure to understand and make allowances for their
political and internal security problems. The Southern
Cone military regimes, especially, are convinced that
their countries' experiences with political disintegra-
tion, insurgency, and terrorism fully warrant tough in-
ternal security measures. The Argentines, for example,
insist that they will not deviate from the practices they
deem indispensable in their continuing war with leftist
terrorists no matter what outside criticism they incur.
The Latins also believe the US has failed to give
them credit for incremental improvements in their human
rights practices. Brazilian President Geisel reportedly
is particularly upset on this score, and Chile's military
leaders now seem convinced that no ameliorative action
they take will be sufficient to satisfy their critics.
The human rights controversy may have complicated
Geisel's personal efforts to prevent excesses by Brazil's
security forces, and the Chilean junta has recently taken
a still harder line against political activity and ex-
pression.
The military regimes now appear determined not to
take any action that could be construed as caving in to
One of 82 such reports submitted to Congress in
accordance with Section 301 of the International Security
Assistance and Arms Export Control Act of 1976.
RP All 77-004
20 April 1977
Approved For Release 20071! CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/0311 RCfA-RDP79T00912A002300010002-2
US pressure. Significant improvement in their human rights
practices is likely to come only when they believe such
action is compatible with their internal security situ-
ations and when there is no danger of appearing to be
responding meekly to Washington's wishes.
The Latins remain resentful over the fact that they
were not considered important enough to US interests to
be treated specially (e.g., like South Korea). They have
questioned US qualifications for making international
moral judgments and have voiced suspicion that the US has
ulterior motives for its human rights stand. The latter
view is particularly strong in Brazil, where the human
rights issue is viewed as an adjunct to US pressure on
nuclear matters.
The Southern Cone regimes have been commiserating
with each other, and they reportedly are considering
joint moves to convince the US that it has seriously
underestimated the costs of alienating them. There are
also indications, however, that the Latins would prefer
to forgo polemics and halt. any deterioration in their
relations with Washington. This appears to be the case
even in Brazil, where President Geisel reportedly has
reacted positively to a recent letter from President
Carter.
Latin reaction to the US stand has not, of course,
been entirely negative. Venezuela and Costa Rica, two
of Latin America's few remaining democracies, have
strongly endorsed US initiatives.
East Asia
The US stand has been met with a noticeable lack of
enthusiasm in most of East Asia, where with the exception
of Japan all states are ruled by authoritarian regimes
that impose significant restrictions on human rights.
The nations with the closest political, economic, and
security ties to the US--those that feel most vulnerable
to US pressure--seem to have the most negative attitudes.
South Korea's sensitivity on the issue is reflected
in a trend begun last November selectively to ease pres-
sures on dissidents and reduce overt police surveillance.
The press is enjoying greater latitude in its handling
of foreign news, prison conditions for key political
RP All 77-004
20 April 1977
Approved For Release 2007/03 E6IA-RDP79T00912A002300010002-2
 Approved For Release 2007/03 9 R:ECIA-RDP79TOO912A002300010002-2
figures have improve-,--and the goverment has forgone
punishment for a number of protesters. A spate of arrests
in mid-April probably was meant as a warning to those
inclined to increase anti-government activity during the
April 19 independence day period. Seoul shows little
interest in modifying its authoritarian style of rule
which, it argues, is needed to ensure stability in the face
of the North Korean threat.
The Marcos government in the Philippines is quite
concerned over the potential implications of the US
emphasis on human rights. Manila's vulnerability on the
issue is one reason Marcos would like to receive rent
payments for US bases rather than payment in the form of
military assistance subject to annual congressional
scrutiny.
Indonesia is anxious to preserve good relations with
the US, especially the continuance of military aid. Gov-
ernment officials have publicly expressed understanding
of US initiatives, and Jakarta has announced an acceler-
ated timetable for the release of political prisoners.
Privately, however, the Indonesians interpret US emphasis
on human rights as one p:Loy in a series designed to force
their country to cooperate with the US, particularly on
petroleum issues. There is resentment of US interference
in what the Indonesians maintain is essentially an inter-
nal matter.
The government on Taiwan is trying to avoid giving
the US cause to focus on human rights practices there,
but the mainland Chinese political establishment remains
determined to suppress ethnic Taiwanese opposition. Tai-
wan will undoubtedly be tempted to try to turn the issue
to its own advantage by calling attention to the human
rights situation in the People's Republic of China.
Africa
Almost every African government is vulnerable to
criticism on the human rights issue, but reactions to
the US stand have been varied. The white minority
regimes in Southern Africa have for the most part main-
tained a discreet and cautious silence. This reflects
Rhodesian and South African apprehensions about the
prospects they see for US and international pressures
for changes in their discriminatory racial policies.
RP All 77-004
20 April 1977
Approved For Release 2007/03/AVGf A-RDP79T00912A002300010002-2
 Approved For Release 2007/03/0e-RDP79T00912A002300010002-2
Ethiopia feels it has been unjustly singled out as
a human rights violator, and there is displeasure over the
US aid cutback. But poor bilateral relations are mainly
reflective of the revolutionary socialist regime's gener-
ally unfavorable attitude toward the US.
The US emphasis on human rights has been strongly
endorsed by Nigeria, Cameroon, and Gambia. Most black
African states are, in fact, likely to applaud US concern
for human rights so long as they believe its primary
effect will be to foster US support for majority rule in
Southern Africa. The focusing of US attention on the
internal situations of black African states other than
Uganda, however, would with very few exceptions be much
less appreciated.
Middle East
There is an analogous reaction in the Middle East,
where the Arab states tend to define human rights strictly
in terms of concern over Israel's settlement policy in
occupied territories, the fate of Arab prisoners in
Israeli jails, and recognition of the "legitimate rights
of the Palestinian people."
The Arabs will react positively to the US stand so
long as its principal effect in the Middle East is the
focusing of US attention on such issues, rather than on
human rights practices (especially the treatment of mi-
norities) in Arab countries.
The Israelis, of course, are concerned over the
possible implications of increased US interest in their
treatment of Arabs in the occupied territories. On the
other hand, the Israelis apparently believe the US will
be inclined to support initiatives they may take to focus
international attention on Soviet harassment of Jews who
have asked to leave the USSR.
Prospects
The impact that US human rights initiatives will
have on international politics over the next several
months will depend in large part on how forcefully the
US chooses to press the issue. Repeated protestations
as to the universality of US concerns are in any case
RP All 77-004
20 April 1977
Approved For Release 2007/03~b~R CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
unlikely to dissuade most of the vulnerable governments
from continuing to interpret even general US actions or
pronouncements as attacks directed particularly against
them.
The Soviets will continue to seek wide-ranging sup-
port for their contention that comments by one state
about the human rights situation in another constitute
impermissible interference in internal affairs. They
may not be content with continued reliance primarily on
this essentially defensive line, however, and they could
try to turn the issue against the US with allegations of
past domestic and international misdeeds, present injus-
tices, and socio-economic inequities in US society. But
the Soviets would probably prefer to avoid direct po-
lemical battles that would further dramatize the human
rights issue, and they would be likely to couple any
such campaign with private signals that bilateral rela-
tions would be better served by mutual restraint.
Another likely Soviet tack will involve continued
efforts to convince US and West European leaders that
the controversy over human rights threatens to compli-
cate the tasks of Soviet leaders committed to the further-
ance of detente. The obviously self-serving nature of
this argument does not mean that it has no basis in fact.
Nonetheless, Brezhnev is adept at turning seemingly ad-
verse developments to his own advantage, and it could
be that he has been able to use the human rights issue
to deflect attention from serious domestic economic
difficulties.
In preparation for the coming CSCE sessions, the
Soviets will also be trying to convince the West Euro-
peans that degeneration of the meeting into an acrimonious
exchange of charges on implementation of the Helsinki
final act would be a severe setback for detente. There
are indications that many West European leaders are
already worried on this score and do not want the Soviets
to be "put in the dock" at Belgrade. The Soviets may,
in fact, believe that the asymmetry of US and West Euro-
pean perspectives on human rights can be exploited to
create controversy and tension within the Atlantic
Alliance.
RP All 77-004
20 _April' 19.77
Approved For Release 2007/03/AYCI ]A-RDP79T00912A002300010002-2
 Approved For Release 2007/03/9?d I~-RDP79T00912A002300010002-2
Other countries that have reacted most negatively
to US human rights initiatives seem to be hoping for a
"cooling off" period that would permit a resumption of
less antagonistic bilateral relations and allow them to
develop strategies for coping with the new situation.
This is especially the case in Latin America, where re-
cent congressional testimony by Assistant Secretary of
State Tolman and Human Rights Coordinator Derian has
been interpreted as signaling that significant changes
in US tactics for pursuing human rights objectives are
in the offing. Disappointment of such expectations would
give added impetus to the Southern Cone countries' dis-
cussions about convincing the US that they are vitally
important to its interests. They too reportedly have
been considering ways in which the human rights issue
could be turned against Washington.
Countries that might be vulnerable on the human
rights issue but have not felt particularly pressured by
US initiatives probably would also appreciate a more
restrained US approach. Iran, for example, vigorously
rejects accusations that it systematically violates human
rights, but Tehran still is concerned that relations with
the US could be damaged by controversy over its practices.
The Iranians contend that the US is itself subject to
criticism on a number of points.
Actions or pronouncements interpreted by other
nations as heralding the focusing of US attention on
their human rights practices are likely to increase
complaints of US interference in strictly internal
affairs. Attacks on US practices and motives, on such
matters as US failure to ratify international human
rights covenants like the Genocide Convention, and on
Washington's maintenance of a double standard on human
rights where US strategic interests are involved, would
probably also increase in number and intensity. Criti-
cism of alleged US disinterest in the world wide advance-
ment of social and economic justice is especially likely
to increase if the less developed countries (LDC) conclude
that the US plans to link human rights to international
economic issues.
The US already has been accused of defining human,
rights too narrowly in terms of civil and political
RP All 77-004
20-.April 19.77
Approved For Release 2007/0?ki FClA-RDP79TO0912AO02300010002-2
 Approved For Release 2007/0A/P~ -~IA-RDP79T00912A002300010002-2
liberties and of being unwilling to do more than pay lip
service to LDC demands that the economic and social rights
of mankind be advanced by restructuring international
economic relations so as to reduce the gap between the
world's rich and poor nations. A key component of the
LDCs' concept of this "new international economic order"
calls for substantially increased LDC influence over the
decision-making processes of international financial
institutions. Indications that the US might seek to fur-
ther its human rights objectives in these institutions
even where their charters call for loan decisions to be
made strictly on the basis of economic considerations
will undoubtedly intensify LDC pressure for changes in
voting procedures. The "North-South" dialogue, more-
over, could become considerably more contentious generally
if controversy over human rights were to severely damage
US relations with nations (like Brazil) that have played
significant moderating roles in the articulation of LDC
demands.
The composition and strength of US human rights
initiatives will also have an important bearing on whether
and how the US stand affects the actual practices of
other nations in the months ahead. US initiatives are
likely to continue to prove effective in some situations--
especially where governments eager to establish or main-
tain harmonious bilateral relations are confident enough
about their internal security situations to risk amelio-
rative action--and counterproductive in others--where US
pressure compounds existent insecurity and precipitates
a fiercely nationalistic reaction that even local human
rights advocates may be constrained to join.
Either way, the impact of the US stand is likely to
be felt mainly at the margins, at least over the short
term. Human rights practices around the world reflect
underlying socio-cultural and political dynamics, includ-
ing the peculiar imperatives of authoritarian rule.*
Basic progress in alleviating human rights abuses will
probably continue to depend mainly on whether totalitarian
and authoritarian regimes increase their sense of security
enough to moderate their practices or, egive way
to effective democratic governments.
20 April 1977
25X1
Approved For Release 2007/03J 7RBdIA-RDP79TOO912A002300010002-2
 Approved For Release 2007/03 R@A-RDP79T00912A002300010002-2
25X1
Brazilian Nuclear Intentions
The announcement by the Federal Republic of Germany
that it has approved export licenses for the transfer of
sensitive nuclear facilities to Brazil marked an im-
portant stage in the implementation of the 1975 FRG-
Brazil nuclear accord. In light of Brazil's determina-
tion to acquire plants that could greatly facilitate an
attempt to fabricate nuclear explosives, we assess
Brazil's actual and prospective intentions in this area.
The Brazilian government does not appear to have
plans to develop nuclear weapons at the present time.
However, two factors could change this situation in the
near future: the succession to the presidency after
Ernes to Geisel of a more nationalistic and "hard-line"
military figure, or heightened apprehensions about the.
ambitious Argentine nuclear program.
The current regime in Brasilia appears to have
sincere economic and technical motivations for develop-
ing nuclear technology. Brazil's exposed energy position,
which results from dependence on imports for 80 percent
of its oil and the bulk of its overall energy require-
ments, is a strong incentive to develop nuclear power.
Brazil has a formidable hydroelectric potential, but
this source is probably inadequate to meet more than
about a third of anticipated 1985 energy demands.
Brazil also has a strong desire to catapult itself into
the ranks of the technologically advanced, modern
nations. It sees the access it would.gain to high
technology through the West German nuclear deal as a
way of fulfilling these aspirations. Despite concerns
voiced in some quarters that this very access to sensi-
tive aspects of nuclear technology--specifically
uranium enrichment and spent fuel reprocessing--would
pose a nuclear proliferation risk, there is no reliable
evidence that the current Brazilian government actually
intends to divert the German facilities to military or
explosive ends.
RP All 77-004
20 April 1977
--l5-
Approved For Release 2007/0'b7REdIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
ORGANIZATION AND FUNCTIONS OF CIVILIAN NUCLEAR SECTOR
Off i.ce of f.he_ Pres i dent of the Republ i c
Definition of nuclear energy policy
rMi ni stry of Mines and Enema
Planning, execution, and control of national nuclear energy policy
,NATIONAL NUCLEAR ENERGY COMMISSION!
1. Standards and authorization
for nuclear installations
licensing
2. Standards on safety and
protection during the construc-
tion and operation of nuclear
installations and in the use of
nuclear materials
3. Supervision and inspection of
nuclear activities in the country
4. Nuclear scientific research
5. Training of scientists,
engineers, and nuclear
researchers
ELECTRIC POWER SERVICES{
_ CONGESSIQNAL$E5._ I
1. Nuclear powerplant construc-
tion contract
1
'02. Operation of nuclear powerplants
-(ELECTROBRASI
1. Advice on decision regarding
concession to build and operate
nuclear powerplants
2. Financing of.nuclear power-
plant construction
NUCLEBRAS~
1. Monopoly in the prospecting,
search and processing of nuclear
minerals
2. Monopoly on production of uranium
concentrates
3. Monopoly on the construction and
operation of plants for:
uranium enrichment
fuel element production
uranium and plutonium reprocessing
4. Monopoly on sale of nuclear
materials
6. Assistance to provide industry
in production of components for
nuclear installations
7. Nuclear powerplant construction
engineering for electric power
service concessionaires
8. Assistance to electric power
service concessionaires in operation
of nuclear powerplants
9. Operation of nuclear technology
institutes and research centers
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
Brazil's stand opposing advancea military develop-
ment of nuclear technology may be altered if present
political patterns change or if the Argentine nuclear
program progresses in a dramatic fashion. While attitudes
of the most likely presidential candidates toward nuclear
weapon development are not well known, some members of
the Brazilian military establishment, from which Geisel's
successor will be drawn, are likely to give more serious
attention in the future to the military application of
nuclear technology. If a highly nationalistic figure
should ascend to the presidency in 1979, the chance of
the Brazilian military for getting a green light on
nuclear development would be increased.* The Argentine
nuclear program is developing rapidly and may accentuate
a long-standing rivalry with Brazil. Recent intelligence
estimates indicate that Argentina, which is quickly mov-
ing to develop an independent fuel cycle, could conceiv-
ably produce a nuclear explosive within two years.
Neither Argentina nor Brazil is a Non-Proliferation
Treaty (NPT) adherent. Brazil has complained that the
NPT is discriminatory against nonweapon states and in
the past indicated it wished to be free to develop its
own nuclear explosives for peaceful purposes (PNEs).
Brazilian political leaders are currently avoiding dis-
cussion of PNEs, probably to deflect attention from the
fact they have not renounced this.option. The PNE route
is thus left open for the present and future governments
to demonstrate Brazil's nuclear prowess, if a perceived
need should arise.
* Geisel's successor will take office in March 1979 for
a six-year term. If the West German nuclear agreement is
carried out, Brazil will obtain all or most of the nu--
clear fuel cycle during that period. While there is
little information on the attitudes of the major pres-
dential possibilities toward nuclear weapons development,
there are philosophical differences between two senior
military leaders which could be pertinent. General
Reynaldo Mello de AZmeida, a political moderate and a
man of intellectual bent, would most likely view nuclear
technology as a tool to sustain Brazil's economic growth.
(Footnote continued on following page.)
RP All 77-004
20 April 1977
Approved For Release 2007/03/ 'cRCkA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/M-5TA-RDP79T00912A002300010002-2
MILITARY NUCLEAR SECTOR
Ministry of the Army
Department of Research and Training
(DEP)
Directorate of Research and Technical
Instruction (DPET)
Military Engineering Institute (IME)
*Heavy Water Research and Development
Group (GPD/APE)
(Chief)
[General Sylvio Couto
Coelho da Frota]
[General Ariel Pacca
da Fonseca]
[General Ayrton Ribeiro
da Silveira]
[General Paulo Cesar
Pinheinro Menezes]
* In the past has produced reports advocating development of
nuclear explosives
RP All 77-004
20 April 1977
Approved For Release 2007/03/07: CIA-RDP79TOO912AO02300010002-2
~18-
 Approved For Release 2007/03/47Ee--RDP79T00912A002300010002-2
It appears unlikely that Brazil entered into its
agreement with West Germany to purchase enrichment and
reprocessing facilities with the firm intention of us-
ing them to build nuclear explosives. Indeed, there is
some indication that President Geisel has specifically
ordered that there be no discussion within the military
of development of nuclear weapons. Geisel's views are
probably not shared by all parts of the military estab-
lishment. The Armed Forces General Staff has emphasized
the necessity of keeping part of Brazil's nuclear re-
search structure free of safeguards, presumably to
leave the nuclear explosives option open. While Geisel's
wishes will probably not be openly challenged during the
next two years, pro-nuclear views could remain latent.
now but emerge later. All the nuclear facilities sold.
under the 1975 accord with West Germany are to be covered
by extensive international safeguards, more stringent.
than those provided by the NPT. Brazil even agreed not
to duplicate the German facilities and not to use them
to build PNEs. If the Brazilians later decide to develop
a nuclear explosive facility, they might violate their
agreements or draw indirectly on the acquired technology
to construct indigenous facilities.
Thus Brazil's capability to build nuclear weapons
will clearly be increased by implementation of the FRG
deal. But Brazil will not necessarily "drift" into a
nuclear weapons program. A decision to do so would be
conscious and made at the highest levels, and probably
only after considerable debate the consideration of the
implications for Brazil's foreign relations.
* (Footnote continued from previous page.) He has pubZicZy
defended the West German agreement
i,ne nue ear views o ano e
General Joao Baptista Figueiredo, are not a matter of
record. He is chief of the National Intelligence Service
and is associated with the"hard- tine" conservative fac-
tion o the miZitar .
RP All 17-004
20 April 1977
25X1
25X1
25X6
19-
Approved For Release 2007/03/0 .C61f RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912A002300010002-2
SECRET
Proposals that Brazil
go ahead and develop purely
national nuclear reactors
have already been made by
leading members of the
Brazilian scientific com-
munity. These reactors
would use natural (unen-
riched) uranium in heavy
water or graphite moderated
reactors. It is notable
that the scientists making
these suggestions are far
removed from the centers of
political power and not
viewed with favor by the
military regime. In fact,
the mere suggestion that
Brazil alter its plans for
cooperation with West Ger-
many along the agreed upon
lines appears to have led
to attempts by the Brazil-
ian government to suppress
these opinions.
Brazil's Angra I nuclear power plant
(under construction)
Signs that Brazil might be more actively consider-
ing developing a nuclear explosive or weapons option
have not yet been detected. The construction of indigenous
unsafeguarded natural uranium reactors would be a
critical benchmark. Other warning signals would be ex-
pansion of the nuclear engineering and research efforts
of the Brazilian military. In the past the Brazilian
military has had a small group working on heavy-water
production. The head of this group was an active advocate
of nuclear arms. He has not risen to political prominence,
however, and his views appear to have carried little
weight. A sudden increase in this individual's impor-
tance might signal a serious new interest by the military
in the nuclear option.
RP All 77-004
20 April 1977
25X1
?-20-
Approved For Release 2007/04J7R (PIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/g?dam-RDP79T00912A002300010002-2
25X1
The Politics of the G-77: Near-Term Implications
for the North-South Dialogue
This article examines some of the political factors
ZikeZy to affect the outlook of key Zess developed coun-
tries (LDCs) toward the North-South dialogue for the
remainder of this year, especiaZZy their views on the
desirability of maintaining the cohesion of the G-77 as
The basic finding discussed here is that important
differences now exist among LDCs not only over what
goals to pursue but also over commitment to the G-77 it-
self. These differences have contributed to a growing
ambivalence on the part of some key LDCs toward the G-77
and a preference for shifting consideration of some
North-South issues (especiaZZy debt relief, improved
market access for LDCs, regulation of multinational cor-
porations, and technology transfer) from CIEC and UNCTAD
to bilateral and regional forums.
Though this tendency is ZikeZy to encourage Zess
politicized discussions of North-South issues, the gap
between the demands even of the moderate LDCs and the
concessions of the industrial states could still prove
unbridgeable. Thus, North-South tensions are likely to
continue to complicate US relations both with the LDCs
(especially over such issues as human rights and arms
transfers) and with other industrialized countries (over
how responsive they need be to LDC demands).
The "Group of 77"--now composed of 114 countries--
has been the major institution through which the LDCs
have maintained their solidarity in negotiations with
the industrialized countries over demands for a "New
International Economic Order" (NIEO). Thus far, the
RP All 77-004
20 April 1977
-.21-
Approved For Release 2007/03T 1FtTA-RDP79T00912A002300010002-2
 Approved For Release 2007/j7T CIA-RDP79T00912A002300010002-2
leadership of the G-77 (see annex) has been remarkably
successful in subordinating the differences among the
LDCs--over both the appropriate tactics to use in such
negotiations and the priorities attached to particular
demands--for the sake of confronting the industrialized
countries with a united front. But while most LDCs rec-
ognize that G-77 solidarity can have important tactical
value in future negotiations, there is now evidence of
increasing concern about whether the costs of maintaining
G-77 solidarity might make it virtually impossible to
reach sought after compromises with the industrialized
countries. In a sense, this development reflects the
continuing tension in the major LDCs between the belief
that only through far-reaching changes in the interna-
tional economic system can basic development problems be
effectively overcome and the belief that bloc unity be-
hind the NIEO should be played down in order to maintain
the support of the industrialized countries for current
modernization drives.
At the recent Common Fund negotiating conference in
Geneva, for example, concern about the costs of bloc
solidarity was voiced by spokesmen representing such in-
fluential members of the G-77 as Brazil, Argentina, Mexico,
Indonesia, India, the Philippines, Ghana, Saudi Arabia,
and Iran. These states appear to be worried that the
compromises they would like to reach with the industri-
alized countries on measures to improve LDC export earn-
ings, facilitate debt relief, and increase the role and
authority of LDCs in international financial institutions
will be impossible to negotiate within the framework of
the G-77.
At Geneva, the more moderate and pragmatic LDCs
found that maintaining G-77 solidarity required accommo-
dation to the demands of a group of self-styled "radicals"
(Libya, Pakistan, Mozambique, Guinea, Cuba) which oppose
any form of compromise with the industrialized countries
over NIEO demands. The necessity for such accommodation
vitiated all efforts by the more moderate elements in
the G-77 leadership (especially Indonesia and Ghana) to
avert a confrontation over the Common Fund and effec-
tively precluded any meaningful discussion of alterna-
tive proposals. Similar experiences have recently been
reported at the LDC "prepcons" for the CIEC ministerial
and for the establishment of the International Fund for
RP All 77-004
20 April 1977
-22-
Approved For Release 2007/0311 :EQ IA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912A002300010002-2
SECRET
Agricultural Development. In addition, OPEC's rejection
of a Venezuelan proposal to keep oil prices constant for
LDCs along with Saudi Arabia's decision that its contri-
bution to a Common Fund would be taken out of the Special
Fund* have probably also contributed to second thoughts
on the part of influential non-OPEC states regarding the
value of G-77 solidarity.
These developments--coupled with the difficulty most
of the LDC participants in the Conference on International
Economic Cooperation (CIEC) are having in representing the
entire G-77--appear to be contributing to a reappraisal
by key LDCs of the utility of current channels in the
North-South dialogue. Especially for the LDC moderates,
there now appears to be a growing preference for deal-
ing with North-South issues at the regional and bilateral
rather than the global level. These LDCs also seriously
doubt that the new US administration will be able (partly
because of differences among the industrialized states
themselves) to propose compromises that would satisfy
the demands of the radicals. As a result, the moderates
fear that there could be increased tension in North-South
relations that would adversely affect the atmosphere of
the CIEC and sharply politicize the next UN General As-
sembly.
Such tension would reinforce the ambivalence of the
moderates toward the G-77 and the process of bloc politics
it represents. Hence, the more pragmatic LDCs may.feel
that if there is to be any progress on the issues with
which they are primarily concerned, alternatives to the
CIEC and UNCTAD venues should be developed.
While global forums will continue to provide the
setting for rhetorical confrontations on North-South
issues, the LDCs seem likely to look.increasingly to
bilateral and regional relations for concrete progress
toward their objectives vis-a-vis the industrial nations.
However, the LDCs will still probably be seeking funda-
mental (i.e., systemic) changes in the international-
economic system and substantial transfers of wealth and
power that most industrialized countries believe either
The practical effect of this would be to reduce the
total amount of funds available to those LDCs which are
already receiving assistance from the Special Fund.
RP All 77-004
20 April 1977
-23-
Approved For Release 2007/03/976I4 -RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
impractical or unjustifiable. In addition, some LDC mod-
erates may be concerned that efforts to deal with North-
South issues at the regional and bilateral levels may be
complicated by US initiatives in the areas of human rights,
arms transfers, and nuclear proliferation. Thus, the
tendency on the part of most LDCs to waver between support
for a bloc politics approach to North-South issues and
the search for less politicized ways to negotiate with
the industrialized countries will probably continue to
be a major factor in the political dynamics shaping the
North-South dialogue the period ahead.
RP All 77-004
20 April 1977
25X1
-24-
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
 Approved For Release 2007/0 5/ff ECIA-RDP79T00912A002300010002-2
The G-77 was created at the first ministerial meet-
ing of UNCTAD (Geneva, 1964) and has served as the LDCs'
UN caucusing group in New York, Geneva, Rome, and Paris.
While the formal chairmanship of the group rotates among
three regional groupings (African, Asian, Latin American)
and fairly frequently (every three months in Geneva), the
states listed on the chart. are considered by UNCTAD offi-
cials and US mission personnel to constitute the core of
"influentials" who provide the leadership of the G-77.
We believe that of this list Brazil, Argentina, India,
Sri Lanka, Indonesia, Malaysia, the Philippines, Kenya,
Ghana, and Zambia consider themselves to be the major
advocates of compromise with the industrialized countries
over the NIEO. These states also feel that it has been
largely through their leadership that G-77 solidarity has
been maintained despite the many differences which exist
among LDCs over not only negotiating tactics but also
over the priorities to be attached to specific demands..
(Chart follows)
RP All 77-004
20 April 1977
Approved For Release 2007/03/0 D6FIY RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
KEY LESS DEVELOPED COUNTRIES
IN THE NORTH-SOUTH DIALOGUE
POPULATION
(1977)
GNP p/c
(1975 est.)
TOTAL EXPORTS
(FOB, 1975)
TOTAL IMPORTS
(CIF, 1975)
millions
US $
Million US $
Million US $
ROL
E IN NORTH-SOUTH DIALOGUE
LATIN AMERICA
Argentina
B
25.9
1,510
2,960
3,950
CIEC Partici
ant
razil
Mexico
111.7
63
2
830
1
350
8,655
13,657
p
CIEC Participant
.
,
3,309
6,580
Author of CERDS, Host to G-77
Meetings on Third World Economic
800
1,378
2,491
Cooperation; CIEC Participant
Host to UNIDO Meeting; CIEC
C,)
Participant; Co-Chairman, CIEC
Raw Materials Commission; Member,
G-19 Working Group on the Problem
M
i
2
280
of Indebtedness (WGPI)
~ rn
M 1
SOUTH ASI
,
9,500
6,000
OPEC Member, CIEC Co-Chairman
--I
A
India
140
4,500
6,100
CIEC Participant, WGPI
230
588
737
Host to Non-Aligned Nations
N
oro
SOUTHEAST ASIA
Indonesia
136.0
230
6,800
5,000
Meeting
OPEC Member, CIEC Participant;
Malaysia
12
4
670
WGPI; G-77 Spokesman at Common
Fund Negotiations
ro H
Philippines
.
43.7
370
3,600
3,700
Chairman,International Tin Council
FI H
W
H I
AFRICA
2,275
3,350
Host to G-77 Meeting; Chairman
G-77 at UNCTAD-IV; Host to IMF
1976 Meeting; Host to UNCTAD-V
(1979)
of
lD O
~t o
Algeria
17.6
730
4,440
5,860
Leading Spokesman for NIEO;
Ghana
I
C
10.3
390
785
662
Largest Contributor of Staff to
G-77; CIEC Participant
Leader of African Caucus
f G
77
vory
oast
7.0
825
1,200
1
100
o
-
Kenya
14.1
190
600
,
950
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912A002300010002r2
POPULATION
(1977)
GNP P/C
(1975 est.)
$
TOTAL EXPORTS
(FOB, 1975)
Million US $
TOTAL IMPORTS
(CIF, 1975)
Million US $
ROLE IN NORTH-SOUTH DIALOGUE
millions
US
Nigeria
65.6
365
8,000
5,300
OPEC Member; CIEC Participant
ant
IEC Partici
Zaire
26.0
80
825
1,057
p
C
ant
rtici
IEC P
Zambia
5.0
470
780
845
p
a
C
M
MIDDLE EAST
Egypt
38.5
300
510
1,570
900
19
4,590
13,300
President, World Food Council;
CIEC Participant
Seeking to be Headquarters of IFAD;
n
v
Iran
34.5
1,
,
CIEC Participant
M
t
600
28
500
6
Has linked oil prices to progress
H
Saudi Arabia
7.5
5,530
,
,
on North-South issues; recently
Iv `,d
o rd
H
I-i H
F'-
H
Hi
%10 0
-4 o
doubled its financial support
of UNCTAD and regional develop-
ment programs; viewed by most
other LDCs as key country
to success of Third World
Economic Cooperation Movement;
CIEC Participant
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912A002300010002-2
Less Developed Country Demands for Technology Transfer
Less developed country (LDC) demands for technology
transfer from the developed countries have been an in-
tegral part of calls for a New International Economic
Order (NIEO) and are likely to continue to be voiced in
a variety of international forums during 1977. These
demands reflect the increasing awareness of LDC Leaders
that technology can be a powerful instrument of social
change and an important element of economic as well as
political and military power. A document stating the
technology policies of the Andean Pact declares, for
example, that "Technological superiority has political
significance and is a key factor in the exercise of
power." By obtaining their own technological base, LDCs
hope to reduce the extent to which they are the targets
of such power as exercised by the developed countries.
However, even in the event of substantial responsiveness
on the part of the industrial countries, the LDCs' goals
in this area are unlikely to be attained unless they
effectively allocate sufficient resources of their own
to make possible the absorption and further development
of foreign technologies.
The demands made in Manila by the Group of 77 in-
dicate the range of LDC concerns regarding technology
transfer:
--The developing countries should give consid-
eration-, at the national level, to formulation
of a national development plan and the estab-
lishment of institutional machinery including
national centers for the development and
transfer of technology.
--The developed countries and competent in-
ternational institutions should provide the
least developed countries with the necessary
assistance for establishing institutions
for applied technology, with the aim of
RP All 77-004
20 April 1977
25X1
Approved For Release 2007/& /~7 TCIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03,CRA-RDP79T00912A002300010002-2
developing indigenous technologies and
promoting the adaptation of imported tech-
nologies to national requirements.
--In order to compensate for the "brain drain"
resulting from the exodus of trained personnel
from the developing countries, arrangements
should be made by the developed countries to
provide on a cost free basis, the necessary
financial means to create the infrastructure
to retain qualified personnel in developing
countries.
--Adoption of a multilateral code of conduct
for effectively regulating the transfer of
technology that will be a legally binding
instrument.
--The developed countries should grant the
developing countries unrestricted access
to existing tee chnology irrespective of
.ownership of such technology. In addition,
the Paris Convention on Industrial Prop-
erty should be amended so as to meet the
needs of the developing countries.*
The first three demands demonstrate a clear rec-
ognition by the LDCs of their need for infrastructures
and plans for developing their own technology as well
as assimilating imported technology. The LDCs go further
and demand assistance from the developed countries in
building such infrastructures. Yet, of themselves, they
only promise to "give consideration" to the planning and
establishing of the infrastructure. Unless the recipient
makes a specific and considerable effort to create an
infrastructure, however, his assimilation of a new tech-
nology cannot become effective.
Among LDCs, such required preparatory efforts would
include a wide allocation of resources of capital, man--
power, education and training, organization building,
ManiZa Declaration and Programme of Action, Note
by the Secretary General of the United Nations Conference
on Trade and Development, TD/195, 12 February 1976,
(emphasis added).
RP All 77-004
20 April 1977
Approved For Release 2007/03V6t ftIA-RDP79T00912A002300010002-2
 Approved For Release 2007/~i/8' CIA-RDP79T00912A002300010002-2
and time. This is a costly and long-range commitment,
the extent of which depends on the level of technological
development that an individual country starts from and on
its specific objectives. Until the required infrastructure
is ready, the mere acquisition of new technological knowl-
edge and assistance will be of limited utility. Therefore,
if the LDCs are serious about building and using their
own technological bases, then the burden is on them first
to make the necessary preparations for absorbing the out-
side help. Otherwise, their demands from the developed
countries and their goal of achieving at least 25 percent
of the world manufacturing production by the year 2000
are likely to remain mostly rhetoric.
One measurement of the amount of assistance desired
from the developed countries is the demand that the least
developed countries be brought up to a technological
level at which trained personnel will have sufficient
professional incentives to stay and work in their own
countries. Fulfilling this demand would not only be much
more costly than the benefits the developed countries
gain from the brain drain (which are estimated by the
LDCs to amount to several billion dollars by now) but
it is also unrealistic because even the developed coun-
tries cannot always maintain equally balanced professional
incentives among themselves. Furthermore, incentives
for immigration go beyond professional working conditions
and opportunities so that improving those is not neces-
sarily going to stop the brain drain.
The demand for a code of conduct regulating the
transfer of technology that will be legally binding is
not likely to be a very effective instrument. One reason
is that there is no international organization that can
enforce such a code. But more important, the transfer
of technology can be much more successful when spurred
by voluntary action and incentives rather than controlled
by regulations. Some regulation, preferably on a na-
tional level, is advisable in order to keep the process
within equitable limits, but over-regulation is most
likely to accomplish the opposite and stifle the process.
The key to success seems to be an environment of mutual
trust with minimal economic and political risk for both
donors and recipients.
RP All 77-004
20 April 1977
Approved For Release 2007/0C 7t ~ CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/0,Vb$RFdIA-RDP79T00912A002300010002-2
The demands for unrestricted access to technology,
irrespective of ownership, and for corresponding changes
in the status of industrial property pose a serious prob-
lem of institutional incompatibilities. While the seat
of most technological knowledge in the non-communist
developed countries is in private enterprises, govern-
ments are the most prevalent instrument for technology
development and transfer in many of the LDCs. Negotia-
tions between a multitude of private companies on one
side and a government on the other usually is much more
tedious and complicated than a government-to-government
or enterprise-to-enterprise interaction.
The developing countries, however, claim that in
negotiations between enterprises in developed and de-
veloping countries, the former impose unfair restrictions
that increase the expenses and limit the activities of
the technology recipients. Furthermore, many enterprises
in the developing countries lack sufficient knowledge and
experience to negotiate on an equal basis with advanced
foreign enterprises. Therefore, the LDCs insist that
their governments should assist their developing enter-
prises in negotiations on a national or regional basis.
The danger is that too much government heavy-handedness
and regulation might turn foreign companies away.
The alternative of government-to-government inter-
action has only a limited scope because the developed
countries can be of assistance primarily in the organ-
izing of institutions in such areas as education,
defense and, to a certain extent, agriculture. Most
of the current industrial technology in the developed
countries is private property which is protected by
law against unauthorized use and, as much as the LDCs
want it, no government can legally give it away.
The United Nations Conference on Trade and Devel-?
opment estimates that the direct foreign exchange cost:
of transfers of technology to the developing countries--
covering only payments for patents, licensing, know-how,
trademarks and consulting services--may have reached a
total of $1.5 billion by the end of the 1960s.* The
Major Issues Arising from the Transfer of Technol-
ogy to Developing Countries, Report by the United Nations
Conference on Trade and Development, TD/B/AC.11/10/Rev.2,
New York, 1975, pp. 1.
RP All 77-004
20 April 1977
-31-
SECRET
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03 l7 A-RDP79T00912A002300010002-2
same report states that if the targets of the Second
UN Development Decade are to be attained, the payments
could well grow six-fold by the end of the 1970s. The
complaint of the LDCs against the international patent
and trademark systems is that they are based on the
principle of "reciprocity between contracting parties,"
similar to that governing international trade relations.
They maintain that such equal treatment between unequal
countries benefits the more powerful and accentuates
the problems of the less advanced. The LDCs want to re-
place this principle with another based on preferential
treatment for the weaker countries. But if carried to
extreme, the principle of preferential treatment might
undermine the principle of private property. Furthermore,
if international patents are put in danger of losing much
of their commercial values, investors are very likely
going to resort to secrecy, which will make the process
of technology transfer to LDCs much more difficult and,
thereby, defeat the LDCs' purpose.
An effective process of technology transfer to LDCs
will require a long time and many resources until the
recipients cannot only assimilate existing technologies
but, more important, adapt and develop them further for
future need. Both developing and developed countries
have some valid, although conflicting, demands and com-
plaints. In addition, if some past practices and demands
for the future are carried to extremes, they are bound
to cause more harm than good. Therefore, it seems that
an environment of moderation and cooperation might be
beneficial for both sides.
RP All 77-004
20 April 1977
25X1
Approved For Release 2007/0?k EtIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07SE-RDP79T00912A002300010002-2
25X1
The North-South Dialogue and Indonesia
The recent visit to the United States of Widjojo
Nitisastro, Indonesian Minister of State for Economy,
Finance and Industry, and Chairman of the National De-
velopment Planning Board was meant, in part, to under-
score the importance that key less developed countries
(LDC) attach to the North-South dialogue. Because the
objectives of its foreign economic policy are closely
linked to its domestic development goals, Indonesia's
approach to the North-South dialogue has probably been
the most closely coordinated of the Suharto government's
foreign policies. Devised largely by the same techno-
cratic ministers who formulate domestic economic policy,
foreign economic policy has taken precedence over other
more strictly political objectives, and the importance
attached to it permeates every issue in which relations
with the US and other industrial nations are involved.
However, growing opposition to these technocrats on the
part of other Indonesian elites could produce some re-
ordering of priorities in the future.
Indonesia, which has been an advocate of Third
World unity since the 1950s, is an active supporter of
LDC demands for a "New International Economic Order."
President Suharto's personal interest in the basic prem-
ises of the North-South dialogue resulted in the forma-
tion of a cabinet-level committee composed of key eco-
nomic advisers. This committee produced a policy paper
on the NIEO in August 1975 in preparation for the 7th
Special Session of the UN General Assembly. Since then,
Indonesia has frequently acted as a major spokesman for
the LDCs at meetings of UNCTAD and the Conference on
International Economic Cooperation (CIEC). Despite its
dependence on external economic factors for stability
and growth, Indonesia also has been outspokenly critical
of multinational corporations and has joined other de-
veloping nations in demanding major reforms of interna-
tional financial institutions. In its final report to
President Suharto, however, the cabinet-level committee
on the NIEO placed considerable stress on a non-confron-
tational approach to LDC dealings with the industrial
RP All 77-004
20 April 1977
E-33_
Approved For Release 2007/03~/v'f:E6IA-RDP79T00912A002300010002-2
 Approved For Release 2007 %g- CIA-RDP79T00912A002300010002-2
nations, and recent speeches by Suharto and by Minister
Widjojo have reiterated this desire for cooperation.
The need to maintain a posture in support of NIEO
which does not endanger its economic and financial links
with industrial nations will probably continue to be a
moderating force on Indonesia's position in the North-
South dialogue. Indonesia has relied heavily on indus-
trial nations for development assistance and markets for
its few critical raw materials--crude petroleum, rubber,
tin, timber, and copper--and the government does not
feel it can afford to alienate these nations by adopting
radical tactics to achieve the NIEO. While Indonesia
joins other developing countries in seeking relief from
commercial and official debts (its debt-service payments
have reportedly reached the. level of 20 percent of its
foreign exchange earnings), it also realizes that its
credit-worthiness and continuing ability to borrow in-
ternationally could be harmed by vigorous advocacy of
automatic debt-relief proposals. Finally, Indonesia has
encouraged private foreign capital investment, particu-
larly in the oil sector, and will be cautious lest its
pronouncements on the need for an NIEO damage the climate
for foreign investment.
Led by Minister Widjojo and Minister of State for
Research Sumito Djojohadikusumo, the technocrats who
head most government departments are convinced that
more active support of the NIEO will not jeopardize In-
donesia's ties with the industrialized nations. Mostly
US-educated, they have been responsible for rehabilitat-
ing Indonesia's economy since President Suharto took
power in March 1966. Suharto, whose support is the
technocrats' sole power base has until recently backed
them wholeheartedly on both domestic and international
issues. Last year, for example, he relied heavily on
the technocrats' advice and, following the Saudi Arabian
example, approved renegotiation of oil production-shar-
ing contracts with foreign oil companies from a 60-40
to an 85-15 split favoring Indonesia.
But while they are expert economic theorists, the
technocrats proved to be woefully inept businessmen
lacking a basic appreciation of the commercial side of
the Indonesian oil enterprise. The net effect of the
renegotiations was to reduce the incentives to explore
RP All 77-004
20 April 1977
-34-
Approved For Release 2007/03 ~8TA-RDP79T00912A002300010002-2
 Approved For Release 2007/0337A CIA-RDP79T00912A002300010002-2
and invest by the companies to the detriment of both the
domestic prestige of the technocrats and the country's
overall investment climate. As a result, opposition to
the technocrats' leadership has increased. Private
businessmen and military officials, who engage in com-
merce to supplement inadequate budgets, criticize the
technocrats' emphasis on a unified, centrally planned
system and restrictions on foreign private investment
outside the oil sector. They feel that the technocrats
have relied too heavily on advice from the IMF/World
Bank and donor nations.of the Intergovernmental Group
on Indonesia (IGGI) and have ignored the development of
domestic private and public commerce.
Other nationalist and Moslem critics believe the
technocrats have emphasized growth at the expense of
social equity and have, in effect, "sold out" to Western
theories of economic development which are proving harm-
ful to Indonesia. They would prefer an independent, in-
digenous strategy of development. In addition, the mil-
itary debacle in East Timor in 1975-76 has convinced
many military planners that defense should receive a
larger share of the national budget, at the expense of
some of the technocrats' capital-intensive development
projects.
These trends could result in a challenge to the
leadership.of the technocrats and lead to a reexamina-
tion of Indonesia's domestic and foreign economic
policies. While in itself such a development might not
necessarily produce a dramatic change in Indonesia's
desire to see an NIEO, the political pressures that pre-
cipitated it could weaken Indonesia's capacity to re-
mai leader in the North-South dialogue.
na
RP All 77-004
20 April 1977
25X1
Approved For Release 2007/03/07: CIA-RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
SECRET
25X1
UN Water Conference
The United Nations Water Conference, convened for
two weeks last month in Mar del Plata, Argentina, consid-
ered how best to manage the global supplies of water in
the face of mounting requirements from the worldwide
growth of population, agriculture, and industry. The
meeting was the most comprehensive international attempt
made so far toward responsible water usage. Although no
significant new approaches were adopted, concern about
water among the 117 country delegations was translated
into a series of proposals for potentially useful action
at the national, regional, and international levels.
The Mar del Plata conference is one in a series of
UN-sponsored meetings of governments to address critical
resource-oriented problems confronting mankind,. Previous
meetings have dealt with the environment (Stockholm
1972),
food (Rome 1974), population (Bucharest 1974), and
human
settlements (Vancouver 1976). A conference on "desert-
ification" (the encroachment of deserts) is scheduled
for August 29 to September 9, 1977 in Nairobi, and one on
science and technology for early 1979 at a yet to be
determined site.
There was remarkable accord among countries when
the water conference settled down to grappling with the
problems of development, control, and use of fresh water.
Because of intense behind-the-scenes work, potentially
contentious issues that could have detracted from the
spirit and purpose of the conference.were not raised or
were limited to brief exchanges. Argentina and Brazil
held to an apparent preconference agreement to defer
their dispute over the Itaipu hydroelectric project on
the Parana River. Bangladesh, despite rapidly declining
water levels in the Ganges River, did not attack India
for its upstream diversion of water supplies. Nor did
Iraq complain about Syria's usage of the Euphrates'
waters.
RP All 77-004
20 April 1977
6-
Approved For Release 2007/03/(J Cj#-RDP79T00912A002300010002-2
 Approved For Release 2007/03/O&.RR+ RDP79T00912A002300010002-2
Some political disagreements did surface: Panama
denounced the United States for its "exploitation" of
water resources in the Panama Canal Zone, but the reso-
lution finally drafted and passed by consensus came close
to US policy statements. And an Arab-Israeli dispute
briefly flared when Israel protested the presence of the
Palestine Liberation organization at the conference.
Community water supply emerged as a priority concern
among the participants. The United Nations estimates
that at least 20 percent of the world's urban population
and 75 percent of the rural population currently lack
reasonably safe supplies of drinking water. The confer-
ence has a special responsibility to follow up on the
resolution approved at the Vancouver human settlements
conference which called for a worldwide effort to make
potable water available for everyone, by 1990 if possible.
The consensus, however, was that it was not possible to
achieve this goal. Instead, 1980-1990 was declared an
international decade of water supply and sanitation,
following two years of review of present goals. Agree-
ment was reached that greater attention should be
focused on the rural poor, a significant departure from
present priorities in developing countries.
The delegates worked extremely hard to avoid con-
frontation on shared water resources. A resolution was
passed aimed at coordination of water policy among the
users of shared resources, thus reducing the chances
that major water works on transnational rivers will be
planned or implemented without greater concern about
impact on downstream countries.
A principal African-bloc goal in the conference was
the creation of an international fund by the developed
countries to finance water resource research and develop-
ment in the Third World. Extensive African lobbying
drew few supporters, and a substitute resolution was
passed which called for a study by the UN Secretary
General of ways to mobilize additional funding and to
improve the effectiveness and coordination of water
programs based on the use of existing institutions.
In sum, the conference has taken a significant step
toward increasing the awareness of the need for inter-
national cooperation in water management. Remarkably
RP All 77-004
20 April 1977
-37-
Approved For Release 2007/039?TA-RDP79T00912A002300010002-2
 Approved For Release 2007/0,1U EIClA-RDP79TO0912AO02300010002-2
free from polemics, the Mar del Plata meeting stayed on
track through most of the two-week session. It may have
set a tone and style that will carry over into future
international conferences and forums, particularly nego-
tiations on potentially contentious North-South issues.
I I
RP All 77-004
20 April 1977
-38-
Approved For Release 2007/03/6?gR6I7 -RDP79T00912A002300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
Next 1 Page(s) In Document Exempt
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
 Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2
Secret
Secret
Approved For Release 2007/03/07 : CIA-RDP79T00912AO02300010002-2