CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A018500040001-2
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 14, 2016
• Document Release Date: July 15, 2003
• Sequence Number: 1
• Publication Date: March 12, 1971
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
DIA review(s) completed.
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No. 0061/71
12 March 1971
Central Intelligence Bulletin
CONTENTS
COMMUNIST CHINA: There are signs that the leadership
coalition is involved in additional disputes. (Page 1)
PAKISTAN: East Pakistan continues to drift toward de
factindependence. (Page 5)
PORTUGAL: Recent sabotage could limit the prime min-
istteerl ability to undertake reforms. (Page 7)
SWEDEN: The government has decided to cancel lockouts
and to order strikers back to work. (Page 9)
BULGARIA: The party has shaken up the trade union
lea ers ip. (Page 10)
POLAND: Meat remains in short supply. (Page 11)
JAPAN: Efforts to form a non-Marxist labor movement
are meeting increased resistance. (Page 12)
JAPAN: Tokyo is moving to slow the growth of its
alance-of-payments surplus. (Page 13)
CARIBBEAN: Caribbean Free Trade Association members
are seeking a special relationship with the EC. (Page 14)
SYRIA: Referendum (Page 15)
CHILE: Economic improvement (Page 15)
TURKEY: Military demands (Page 15)
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COMMUNIST CHINA: There are signs that Peking's
unstable leadership coalition is involved in addi-
tional disputes.
In the past year two and possibly three impor-
tant members of the Chinese politburo have been
purged amid indications of continuing disputes over
the pace and direction of the rebuilding of China's
party and governmental apparatus. Now these inter-
necine disputes may have spilled over into foreign
policy matters. Authoritative attention has been
directed at a new "quotation" of Chairman Mao brand-
ing any reluctance to help North Vietnam as "mutiny
and betrayal of the revolution." This is extremely
strong language; such a reference attributed to Mao
has not been seen since the height of the Cultural
Revolution.
It is not clear what precisely is at issue in
Peking, although aid to Hanoi is unquestionably a
factor in the present dispute. It is unlikely that
,the Chinese are contemplating a sharp reversal of
their long-standing policy of caution with respect
to the war in Indochina, however. Chou's speeches
in Hanoi, the joint communique issued at the end of
the visit, and ancillary propaganda material ema-
nating from Peking all strongly suggest that the
Chinese expect the "three Indochinese peoples" to
continue to bear the brunt of the fighting so long
as allied operations in the peninsula retain their
present scope and character. Moreover, when Indo-
china.was'last a subject of dispute in Peking, at
the start of the Cultural Revolution in 1965-66,
Mao argued strongly against a "forward" policy of
direct involvement in the struggle, and it does
not seem likely that he has entirely changed his
mind now.
Chou's statements and Chinese propaganda, how-
ever, have raised the specter of a greater Chinese
commitment to the war if it should expand further,
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and the apparent dispute in Peking may revolve around
this question and whether such an expansion would be
a threat to China's security. The Chinese may be
considering and presumably discussing with Hanoi
such contingencies as the dispatch of troops to
North Vietnam in the event South Vietnamese or US
troops either push north in Laos or invade North
Vietnam itself--or in anticipation of such allied
moves. There are indications that President Thieu's
recent statements on carrying the war to the North,
coupled with allied activity near the DMZ and off
the coast of North Vietnam, have created apprehen-
sions in Hanoi, and the North Vietnamese may have
asked the Chinese where they stood in these circum-
stances. The debate in Peking may be over the ques-
tion of how to respond. In any event, the issue ap-
pears to involve future contingencies rather than
immediate moves on the part of the Chinese.
It may be also that the foreign policy aspect
of the presumed debate in Peking has compounded ex-
isting antagonisms within the politburo. There have
been no previous indications of a foreign policy de-
bate in recent Chinese propaganda, and the purges
within the politburo long antedate the present al-
lied operations in Laos. Thus, any disputes among
the Chinese leadership almost certainly involve do-
mestic issues as well. It is apparent that some
form of "China first" argument has been put forward,
but it is unclear whether Mao's strictures are di-
rected against so-called "radicals" or his more con-
servative associates, since either group might have
reason to argue against foreign "adventures."
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PAKISTAN: The government has not yet taken
any action to interfere with East Pakistan's increas-
ing drift toward de facto independence.
President Yahya Khan apparently still plans to
meet East Pakistani leader Mujibur Rahman to seek a
political solution, but no date has yet been set for
his announced trip to East Pakistan.
In East Pakistan, attempts to interfere with
military movements and to deny supplies to the mil-
itarycould develop into a confrontation. Several
army supply convoys have been stopped by crowds,
but so far the army has refrained from responding
with force. The navy has been refused bunkering
facilities by distributors under pressure from the
AwamiLeague. The government has declared that such
acts are punishable, but has yet to take any action.
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PORTUGAL: The recent sabotage at a Portuguese
Air Force base near Lisbon may result in greater ef-
forts by right-wingers to limit Prime Minister Cae-
tano's maneuverability to undertake gradual reforms.
A group calling itself Armed Revolutionary Ac-
tion (ARA) has claimed credit for the explosions on
8 March that destroyed one troop-carrying helicopter
and six Alouette-III helicopters and damaged an un-
specified number of other aircraft. The ARA is a
radical, anticolonialist group whose ultimate goal
is a popular armed insurrection against "fascist
dictatorships." Ties--if any--with other radical
groups have not been established.
The ARA has claimed responsibility for three
other bombing incidents last fall. The targets, ap-
parently selected in part for their symbolic nature,
included a school for the Portuguese secret police,
a dock where equipment and war material destined
for Africa were loaded, and the USIS cultural cen-
ter in Lisbon. The defense attache in Lisbon states
that the ARA has established itself as a highly
organized, disciplined group.
The helicopter losses represent a setback for
the Portuguese Air Force at a time when it has been
expanding helicopter pilot training. In the past
year or so, Lisbon has put increasing emphasis on
helicopters as a key weapon in combating insurgency
in its African colonies.
Right-wing groups in Portugal have already suc-
ceeded in retarding Caetano's moves toward liberal-
ization, a key element of which is the effort to
give greater autonomy to the overseas territories.
These rightists, whose ranks include military offi-
cers and some businessmen and political leaders
under former prime minister Salazar, will doubtless
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use the ARA's audacious attack to renew their at-
tempts to slow down Caetano's reform efforts. Al-
though Caetano has shown in various ways that he is
no longer in Salazar's shadow, he is still dependent
on the support of conservative elements. He might
feel that he must move even more cautiously in im-
plementing his reform program.
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SWEDEN: The government has decided to cut the
Gordian knot in its relations with its employees by
canceling all lockouts now in effect and ordering
strikers back to work by the end of the week.
Under the terms of the emergency powers act
approved by Parliament yesterday, all strikes and
lockouts would be terminated for six weeks or until
a new collective agreement is concluded, whichever
occurs first. Only 12,000 civil servants have gone
out on strike since its beginning on 1 February,
with another 35,000 locked out, but the government
had threatened to increase pressure on the recal-
citrant unions by instituting an unprecedented lock-
out of most of the armed forces officer corps. The
military lockout was postponed a week as a gesture
to get the unions back to the bargaining table, but
when this failed, resort to an enforced cooling-off
period was the only alternative.
The civil servants' unions have condemned the
government's intervention as a setback to civil
rights and liberties and have threatened to boycott
any mediation efforts. The national federation of
labor, however, has announced its support for the
government's course of action and has accused the
civil servants of subverting the national goal of
greater wage equality. Finding little or no sym-
pathy either among labor or the general public and
facing the full power of the government, the civil
servants will probably go back to work.
The government, with only a minority in Parlia-
ment, had to turn to the opposition bourgeois parties
for support of its emergency powers bill, which passed
by a lopsided majority. Even so, leaders of the cen-
ter and right groups sharply criticized the government
for creating a situation which made such action nec-
essary. Only the Communists opposed the bill as a
group, but there are no signs that they will.recon-
sider their vow not to topple a socialist government
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BULGARIA: A shake-up in the leadership of the
Central Council of Trade Unions is intended to im-
prove control over the unions, a response in part
to recent developments in Poland.
The changes made on 9 March include the demo-
tion of the council's chairman, replacement of all
the secretaries, and a reshuffling of the executive
bureau. The party's control of the trade union
apparatus will be tightened by the appointment of
alternate politburo member Kostadin Gyaurov as the
new trade union boss. He replaces Roza Koritarova,
who was demoted to a newly created slot of deputy
chairman. The appointment of Stoil Khristov, the
deputy chief of the party's organizational depart-
ment with responsibility for cadre appointments,
as one of the new trade union secretaries may signal
further personnel shifts at the lower trade union
levels. Another newly appointed secretary has long
served in the central apparatus of the youth organi-
zation, suggesting that the party desires to increase
communication with young workers.
The changes undoubtedly are an outgrowth of the
15th plenum of the Central Council of Trade Unions
in mid-February, where "concern for man" was cited
by Roza Koritarova as one of the main functions of
the trade unions. This concept reportedly was en-
dorsed by party boss Todor Zhivkov in a speech to
party workers on 17 February. Another motive for the
changes may be to show the party's concern for workers
by rejuvenating the trade union leadership, a move
which in fact is still little more than cosmetic.
There is some evidence that the trade union
leadership shifts were planned as early as January,
but may have been delayed pending a clarification
of the labor situation in Poland, where a trade
union meeting in late February criticized ast prac-
tice but offered only palliative measures.
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POLAND: Meat remains in short supply despite
continued attention to the problem by the leadership.
The selection of meat available for sale is
limited and supplies at times are inadequate. This
situation is expected to continue for several months,
because procurement of meat from Polish farmers is
running 20 percent behind last year's level.
Imports must take up the slack. Although the
recent Soviet credit of $100 million was extended
apparently to finance adequate imports of meat,
only small purchases have been made thus far from
West Germany, Denmark, and Austria. The most press-
ing need for imports begins now and lasts until
heavy slaughterings in September. Thus, only by
quickly increasing imports or by sharply curtailing
exports of pork and beef can the Polish regime hope
to prevent a worsening of the meat supply situation
in the coming weeks. Current plans calling for an
eight-percent increase in per capita meat consump-
tion this year appear to be unrealistic.
The politburo met Tuesday to review plans for
the provision of food this year and approved a draft
plan for development of livestock production in
1971-75. No details, however, were made public.
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JAPAN: Efforts by moderate labor leaders to
form a new, non-Marxist labor movement are meeting
increased resistance.
Extremist elements of Sohyo, Japan's largest,
Marxist-dominated labor federation, acting in con-
zcert with Communist and Socialist party leaders, are
intensifying efforts to undermine plans for the new
labor federation, which is intended to form a base
for a new, moderate opposition party. Formation of
a pragmatic party with a broad labor base, which
does not exist in Japan at present, could provide an
=>ffective vehicle for challenging the ruling conserv-
atives' long hold on power.
The leftists seem to be shifting their tactics
from boycotting unity efforts and instead are trying
Lo sabotage from within. They played a key role in
the recent ouster of the head of the postal workers'
union, who was one of the top leaders of the labor
reorganization movement. Subsequently the leftists
managed to torpedo the long-planned formation of a
unity preparatory committee by insisting on the in-
clusion of a member of the extreme left-wing metal
workers' union, which was unacceptable to the moder-
ates.
The steady success of moderate efforts until
last month apparently gave the labor unity supporters
a bad case of overconfidence, and they were caught
off guard by the Marxists' change of tactics. The
moderates, anxious to prevent their decade-long
unity goal from being frustrated so close to realiza-
Lion, will probably wait until after the Upper House
:elections in June before vigorously renewing their
campaign.
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JAPAN: Tokyo is moving to slow the growth of
its balance-of-payments surplus, thereby alleviating
possible international pressure for revaluation.of
the yen.
The government has agreed to make available
foreign exchange from official reserves at low in-
terest rates for import financing. This action is
designed to stem the recent flow of US capital re-
sulting from increased borrowing by Japanese traders
who have been financing a greater portion of their
transactions with US banks where interest rates are
lower than those in Japan. According to the Japa-
nese central bank, the flow of dollars from the US,
which amounted to $200 million in the last quarter
of 1970, has grown even larger so far this year.
Rising Japanese exports and an upswing in bond
purchases by foreigners still are expected to boost
Japan's present official exchange. reserves of $5
billion by some $1 billion at mid-year. A Japanese
central bank official has reaffirmed other recent
government statements that Tokyo is not considering
currency revaluation despite further sharp increases
in its balance-of-payments surplus.
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CARIBBEAN: The 11 members of the Caribbean
Free Trade Association (CARIFTA) are seeking a
special relationship with the European Communities
(EC) to avoid possible loss of their privileged
trade position with the UK.
These countries are concerned about maintaining
some preferential arrangements for their sugar and
banana exports, which may be jeopardized if Britain
joins the EC. Commonwealth sugar arrangements are
a major substantive issue in the UK-EC negotiations
because some EC countries also are sugar exporters.
Any sweeping change in the British trade preference
system would deal a serious economic blow to the
smaller islands because 60 to 80 percent of their
exports benefit from it.
The UK's chief Common Market negotiator recently
has indicated that a unified CARIFTA position would
be advantageous. He suggested that CARIFTA might
seek "outright association, conclusion of a trade
agreement, or something less than a trade agreement."
Guyana and Trinidad apparently favor a rather loose
relationship with the Market, whereas the other mem-
bers want actual association with it. The Council
of Ministers of CARIFTA is meeting this week to work
out a joint position.
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SYRIA: In a national referendum today, Hafiz
Asad i is be confirmed as president of Syria. This
is another move by the Syrian strongman--he earlier
appointed a People's Council and made some "consti-
tutional" changes--to broaden the popular appeal of
his four-month-old regime. 25X1
some cabinet and other governmental changes will
follow the election, but there is nothing to suggest
a major departure from the less rigid approach to
governing that has distinguished Asad from his more
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CHILE: The strict price controls imposed by
the Allende government have sharply reduced cost-of-
living increases. The consumer price index has
risen only two percent thus far in 1971, compared
with 12 percent for the same period last year. The
Allende regime, like past governments, has paid par-
ticular attention to controlling the prices of goods
in the index. Success in controlling prices, follow-
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this year, will improve the regime's chances of
winning a majority of votes in the municipal elec-
tions on 4 April.
TURKEY: The military commanders have report-
edly decided to press their demands for political,
social, and economic reforms, as yet unspecified,
through the existing structure of government rather
than through a direct military take-over. In taking
this stand, the high command apparently is resisting
strong pressures from lower-ranking officers who
would prefer more direct action. A national coali-
tion government may yet be formed, especially if
Prime Minister Demirel is forced to resign. Dem-
irel's departure probably would gain at least a
brief interlude during which the civilian authori-
ties could try to satisfy existing grievances within
the military; however, the record of coalition gov-
ernment in Turkey gives little cause for optimism.
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