CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A016700120001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 15, 2016
• Document Release Date: February 10, 2004
• Sequence Number: 1
• Publication Date: July 24, 1970
• Content Type: REPORT

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D
DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
50
24 July 1970
State Department review completed
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SECRET
No. 0176/70
24 July 1970
Central Intelligence Bulletin
CONTENTS
Cambodia: The Communists are maintaining pressure
on scattered government positions. (Page 1)
South KoreaJapaann: Both appear pleased with the
fou rnnual ministerial meeting. (Page 2)
Egypt: Nasir has accepted the US peace proposals but
indicated doubts of US and Israeli intentions. (Page 3)
Algeria: The cabinet reshuffle involves no changes
in policy or priorities. (Page 4)
Algeria: The government has raised the taxes of
French oil companies. (Page 5)
Chile: The Communists reportedly are dickering with
the Christian Democrats for an electoral runoff deal.
(Page 6)
NATO-Greece: Report blocked (Page 7)
Greece: Foreign policy (Page 8)
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Bulgaria-Algeria: Credit extended (Page 8)
Ceylon: Possible further nationalization (Page 9)
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Cambodia: Current Situation
THAILAND
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Communtst-controlled location
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Cambodia: The Communists are maintaining pres-
sure on scattered government positions in the west.
The government's military training base at
Romeas in Kompong Chhnang Province was attacked again
yesterday. Despite heavy air strikes, the Communists
are reported to be holding the market and railway
station. The regional military commander has or-
dered two battalions--one a Khmer Krom battalion--
to Romeas from Kompong Chhnang city.
New enemy attacks were also reported in several
areas of Kompong Speu Province. Government forces
at Kirirom apparently were still in contact with
Communist troops, but no new details are available
on the fighting there.
In the Countryside
Criticism of the way Lon Nol is handling the
war effort has been raised by In Tam, President of
the National Assembly and chief of Kom on Cham
Province. He recently told 25X1
that Lon Nol errs in emphasizing the de tense o nom
Penh and other large cities to the detriment of con-
ditions in the countryside. Tam was particularly
concerned that battalions were being pulled out of
Kompong Cham to defend the capital, a move he be-
lieved would cause the government to lose rural sup-
port.
Back Home from Bangkok
Lon Nol has told the US charge in Phnom Penh
that he thought his talks with Thai leaders in
Bangkok had gone extremely well. He did not specify
any precise results of the talks, however. Re-
strained public comments by Thai leaders on their
sessions with Lon Nol indicate Bangkok is still
hewing to i to the Cambodian
situation. 25X1
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24 Jul 70 Central Intelligence Bulletin 1
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South Korea - Japan: Seoul and Tokyo both ap-
pear pleased with the outcome of the fourth annual
ministerial meeting which closed in Seoul yesterday.
Although the joint communique pays lip service
to a wide variety of bilateral and regional issue-s,
the negotiations appear to have been largely devoted
to economic cooperation. According to the South
Koreans, Seoul offered to conclude an industrial
property settlement and maritime transportation
agreement. In return the Japanese promised prefer-
ential tariff treatment for Korean goods and finan-
cial aid for the construction of four heavy indus-
trial plants and for a number of lesser projects.
In addition, Tokyo agreed to move ahead with a pre-
viously promised loan for $50 million to develop
South Korea's shipping industry.
The Japanese reportedly agreed in principle
to most of what the Koreans requested, with the
proviso that specifics will be negotiated later.
Difficulties are likely to arise when the two
eventually get around to haggling over these, but
in the meantime the Japanese have gained consider-
able favor with the South Koreans at no immediate
cost. Seoul, for its part, can cite the agreement
as compensating for revenue losses that will stem
from the planned cutb in US forces in Korea.
24 Jul 70 Central Intelligence Bulletin
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I Egypt: President Nasir has officially accepted
the US peace proposals but indicated he has doubts
concerning US and Israeli intentions.
In announcing his acceptance yesterday of the
US initiative, Nasir declared there was nothing new
in the US proposals; they merely provided for the
implementation of the November 1967 Security Coun-
cil resolution which Cairo had already accepted.
He said that the 1967 resolution provides for Is-
rael's total withdrawal from all occupied Arab ter-
ritories and also allows the Palestinians to obtain
their rights in accordance with other UN resolutions.
In any case,. the Egyptian leader said, the US initia-
tive was "little more than a process of procedures"
which he does not think "will achieve anything new
due to Israel's stand."
In recounting the military situation in the
Middle East since the June 1967 war, Nasir blamed
Washington for Israel's intransigence and aggres-
siveness. He said there has been complete military
collusion between the US and Israel. The Egyptian
leader charged the US with supplying the most mod-
ern arms to Tel Aviv while seeking to prevent Egypt
from obtaining comparable Soviet arms. He said the
US had threatened to unleash an all-out Israeli air
campaign against Egypt earlier in the year if Cairo
did not accept a cease-fire agreement.
Nasir said he wasn't very optimistic concern-
ing a Middle East settlement and believes that what
has been taken by force can only be regained by
force, but added that he was willing to see if po-
litical action could break the present Arab-Israeli
impasse. Nasir said his doubts about the sincerity
of the US is evidenced by the false US allegations
that Cairo wants war merely for the sake of war,
and that in any event Ec pt would continue to build
up its armed forces.
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Al eriiaa: The long-awaited cabinet reshuffle
announced earlier this week involves no change in
policy or priorities.
Boumediene continues in the dual capacity of
prime minister and minister of defense in a council
that has been enlarged from 19 to 23. Key ministries
remain unchanged except for finance and planning,
which has been split.
The Finance Ministry is now headed by an influ-
ential Algerian economist who has long served as an
adviser to Boumediene; the planning function will
be taken over by a secretary of state. The finance-
planning portfolio has been vacant since last March,
when Cherif Belkacem was relieved for reasons of
health. Belkacem, one of the inner circle around
Boumediene, returns to the cabinet as minister of
state.
Other changes include dividing the Ministry of
Education in two, relieving two ministers for non-
cabinet duties, shifting five other ministers, and
adding five more--in addition to the new finance
minister.
Contrary to speculation among political ob-
servers in Algiers, Ahmed Kaid, chief of the coun-
try's only political party and another member of
the inner circle, did not return to the government.
He presumably will continue his attempts to revit-
alize the nearly moribund National Liberation Front
in preparation for a promised party congress and
parliamentary elections.
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Algeeriiaa: The government's unilateral action in
raising the taxes of French oil companies is designed
to generate additional funds for the country's eco-
nomic development.
Algeria raised the price of oil that it uses as
a basis for tax payments by 77 cents a barrel. This
would increase Algeria's oil revenues by nearly 50
percent, while the profits of the companies would
fall about two thirds to 20 cents a barrel. French
companies produce about 70 percent of Algeria's an-
nual output of crude oil.
This move is the second attempt this summer to
force French concessions in a forthcoming comprehen-
sive review of the 1965 Franco-Algerian oil accord.
Earlier this month, authorities required French
firms to retain about 80 percent of their oil export
revenues in Algeria instead of 50 percent as in the
past.
Under the 1965 accord, the tax reference price
can be modified only by joint action of the two gov-
ernments and any disputes are to be submitted for
arbitration. France, which is resisting the new
price hike, may seek to initiate such procedures.
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Chile: The Communists reportedly are dickering
with the Christian Democrats for an electoral runoff
deal.
Each group,
hopes to line up enough congressional. votes to ensure
success for its candidate in case the presidential
election of 4 September must be decided by the legis-
lature. Under the Chilean constitution, a joint ses-
sion of congress must choose between the two top
contenders if, as is likely, no candidate wins a
majority in the popular election.
The three presidential candidates are independ-
ent conservative Jorge Alessandri, Christian Democrat
Radomiro Tomic, and Marxist Salvador Allende. Many
Chileans find none of the three appealing and may
not settle on their choice until the last moment.
Of the 200 legislators, 82 represent parties
making up the Popular Unity coalition backing Allende,
although he probably can count on only 76 of these.
The governing Christian Democrats have 75 legisla-
tors and Alessandri, now considered the front runner,
has the support of only 43.
In the context of Chilean politics--Marxist
parties received 28 percent of the vote in last
year's congressional elections--discussions like
those under way are the rule rather than the excep-
tion. The race is expected to be close, which will
cause bargaining for congressional votes to intensif
as the election approaches.
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NATO-Greece: The Danes have blocked, at least
until September, consideration of the Defense Plan-
ning Committee's report recommending the strengthen-
ing of local Greek forces. Greek Prime Minister
Papadopoulos, in talks with US officials, agreed to
the delay, but warned that because of Denmark's
"attempted interference" with internal Greek affairs,
there would be no further constitutional liberaliza-
tion until after the report is approved. A confron-
tation on the question has thus been avoided for
the time being, but by September Copenhagen could
be under even more domestic pressure to block the
report.
(continued)
24 Jul 70 Central Intelligewe Bullet r;
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Greece: Career diplomat Christos Xanthopoulos-
Palamas, sworn in Wednesday as undersecretary in the
Foreign Ministry, will have little influence on pol-
icy until he proves his loyalty to the regime.
Prime Minister Papadopoulos personally assumed the
Foreign Ministry portfolio, probably to placate
those regime members who believe Palamas did not de-
fend the regime vigorously enough while serving as
ambassador to the US in the late 1960s. Palamas is
eminently qualified to represent Greece in foreign
affairs, however, having served as representative to
NATO and at the UN. The new undersecretary has ex-
pressed moderate views on the Cyprus question, and
has demonstrated his ability to work well with for-
eign diplomats, including the Turkish representative
to NATO.
Bulgaria-Algeria: Sofia has extended a $40-
million long-term credit for Algeria's current four-
year economic development plan (1970-73). According
to earlier discussions, the credit will be used for
various industrial and agricultural projects, in-
cluding the development of petroleum resources.
Even if the loan is drawn over the plan period, it
will not boost trade sufficiently for the two coun-
tries to reach their announced $60-million trade
goal by 1973. Last year Bulgarian-Algerian trade
totaled only about $10 million.
(continued)
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Cey~lon: The new government may be planning to
nationalize the bunkering facilities of Shell, Esso,
and Caltex. In a letter to shipowners on 14 July,
the state-owned Ceylon Petroleum Corporation (CPC)
offered to meet their bunkering needs and claimed
that it intended to take over the entire bunkering
market shortly. The Ceylon managers of Esso and
Caltex have not yet received formal notification of
such a step, however, suggesting that the CPC may
be trying to force the government to act. On the
other hand, Mrs. Bandaranaike could be using the
CPC, one of the most leftist of Ceylonese state
corporations, to repeat the pattern of extensive
press coverage, followed by official silence, and
then eventual government action that was established
in the recent ouster of the Peace Corps and the Asia
Foundation.
24 Jul 70 Central Intelligence Bulletin 9
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