CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A019000070001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 20
• Document Creation Date: December 14, 2016
• Document Release Date: July 28, 2003
• Sequence Number: 1
• Publication Date: May 14, 1971
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
State Department review completed
N2 040
14 May 1971
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No. 0115/71
14 May 1971
Central Intelligence Bulletin
CONTENTS
EGYPT: President Sadat moves against a number of
critics and possible rivals. (Page 1)
INDIA-PAKISTAN: The refugee situation. (Page 3)
BERLIN: Pankow was exceedingly tough in the latest
negotiations with the Senat. (Page 8)
NORWAY: The prime minister gained overwhelming en-
dorsement from the Labor Party congress. (Page 9)
HUNGARY: A few changes in government personnel.
P age 11)
JAPAN - COMMUNIST CHINA: Peking's efforts to broaden
contacts. (Page
ANGOLA: Low morale among the Congo-based insurgents.
Page 13)
SIERRA LEONE: Stevens' vindictive policy toward his
opponents. (Page 14)
MEXICO-GUATEMALA: The two presidents have discussed
terrorism. (Page 15)
GOLD: The gold market has been active. (Page 17)
CEYLON : Insurgency situation (Page 18)
CHILE: Price increases (Page 18)
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C EGYPT: President Sadat in one move has dis-
posed of a number of critics and possible rivals,
reflecting confidence in his political strength but
leaving an array of powerful victims on the side-
lines.
The "resignations" of Interior Minister Sharawi
Goma and Minister for Presidential Affairs Sami
Sharaf had also been augured in conflicting rumors
of impending changes, stimulated by the unantici-
pated dismissal of Vice President Ali Sabri on 2
May. Goma, who controlled the internal security
services, and Sharaf, with extensive connections in
the Presidency, were considered two of the most
powerful men in the nation. War Minister Muhammad
Fawzi was among other selected targets of Sadat's
purge. Sadat's actions underscore his resolve to
rule as well as reign in Cairo by securing his per-
sonal control over the instruments of power.
A start has been made in filling the vacated
posts with the announced appointment of a former
Nasir associate, Mamduh Salim as interior minister.
Recently appointed governor of Alexandria, Salim's
background in security work makes him technically
qualified to head the Ministry of the Interior.
Chief of Staff Muhammad Sadiq, the new minister of
war, is reputed to have broader support in the mili-
tary than did his predecessor.
By these purges Sadat will be free to exert
personal control over the affairs of the country
and deal with domestic and foreign problems in his
own way. This latest display of personal authority
suggests a good deal of confidence in his ability
to make the changes stick.
The replacement yesterday of the lackluster
General Fawzi may have been intended to gain further
favor with the military. A statement broadcast by
Cairo Radio last night seemed designed to generate
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broad civilian support for Sadat's actions by sug-
gesting that at least some of those ousted had been
plotting to impose "tutelage and domination over
the people" through "repression and terror."
Sadat will need all the support he can get; the
men he has dismissed have strong claims to Nasir's
mantle themselves and some, notably Goma and Sharaf,
have had time to establish power bases of their own.
The statement Sadat is scheduled to broadcast today
should make clearer what he intends to do and how
he expects to go about it.
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INDIA-PAKISTAN: The presence of more than two
million East Pakistani refugees in India is a growing
irritant in Indo-Pakistani relations.
Although no exact figures are available, Indian
officials recently claimed that the refugees numbered
1.8 million, with an average of 60,000 arriving daily.
Indian relief facilities are badly strained, and
sharply rising food prices in the border areas are
antagonizing the local Indian population. New Delhi
is concerned that tension between the residents and
the refugees could lead to violence between Indian
Hindus and East Bengali refugees, many of whom are
Muslims. There is a growing feeling in Indian Gov-
ernment circles that the international community
must "do something soon" to stem the flow of refugees
or New Delhi will be forced to take unspecified "uni-
lateral action."
The Indians believe that the Pakistani Army
will attempt to seal the border against a further
Muslim exodus, but that the Pakistanis may continue
to encourage the Hindus to flee. New Delhi fears
that once established in India, many Hindu refugees--
and possibly some Muslims as well--will be reluctant
to accept repatriation, no matter what conditions
eventually exist in East Pakistan.
Meanwhile, the Indians and the Pakistanis have
exchanged recriminations on the situation in East
Pakistan before the UN Economic and Social Council.
The Indian delegate charged the Pakistanis with
violating the human rights of the Bengalis, and the
Pakistanis blamed India for stimulating secession
in the province. Nevertheless, despite -these emo-
tional charges, the debate was generally restrained.
East Pakistan, and particularly the refugee
situation, is likely to be the main topic of dis-
cussion in the Indian Parliament when it reconvenes
on 24 May. Opposition politicians, as well as some
"young Turks" in Prime Minister Gandhi's Ruling
Congress party, may press strongly for Indian rec-
ognition of an independent Bangla Desh. Mrs. Gandhi
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may make some move short of recognition to placate
her critics; as a starting point, India's presenta-
tion at the UN should help answer those who maintain
that the government has not taken a strong enough
position in support of the embattled East Pakistanis.
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BERLIN: Pankow's exceedingly tough position in
the latest session of negotiations with the West
Berlin Senat has scotched prospects for a Pentecost
pass agreement that would have allowed West Berlin-
ers to visit relatives in the East during the reli-
gious holiday later this month.
The West Berliners, in an effort to seize the
initiative in the stalled talks, tabled a pass pro-
posal at the session on 12 May in the form of a
letter exchange. One letter--which contained a sim-
ple pass formula covering the Pentecost holiday--
was addressed to the Senat and was to be signed by
the East German negotiator. The other was a short
letter of acceptance to be signed by the Senat. The
East Germans promptly rejected the exchange on the
grounds that it was not a formal agreement and that
it contained unacceptable proposals and nomenclature.
The East German negotiator also took a number
of positions that he knew were unacceptable to the
Senat, insisting, for example, that a pass agreement
had to be preceded by the Senat's renunciation of the
Federal government's presence in West Berlin. In
addition he implied that the Senat should help East
Germany to gain membership in international organi-
zations, although this is strongly opposed by Bonn.
The meeting was less friendly than previous
ones and the East German negotiator was described as
"harder and insistent." It was the first pass talks
since Erich Honecker became party first secretary on
3 May. The harsh tone obviously was intended to im-
press the West Berliners that Honecker intends to
pursue a hard line in East-West relations.
Negotiations are to be resumed on 30 June after
the East German party congress. The goal will ap-
parently be to discuss passes for All Saints Day on
1 November and perhaps for Christmas and New Year's.
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NORWAY: Prime Minister Bratteli's Labor govern-
ment has gained an overwhelming endorsement for its
foreign policy program from the Labor Party congress
held earlier this week.
The greatest debate was prompted by the govern-
ment's decision to continue negotiations for member-
ship in the European Communities (EC). Although op-
position within the party was greater than the lead-
ership anticipated, the congress delegates voted by
a three-to-one ratio in support of the government's
policy. The party congress also specified its sup-
port for the government's decision to hold a national
referendum on the question of EC membership before
Parliament makes a final decision.
Bratelli's insistence that Norway's security
policy is firmly based on membership in NATO and his
reluctance to undermine West Germany's Ostpolitik
were also supported by the overwhelming majority of
delegates, who soundly defeated resolutions calling
for withdrawal from NATO and recognition of East
Germany. However, the congress placed the govern-
ment on notice that special efforts would have to be
made in NATO and other international organizations
to restore democracy to Greece and Portugal and to
end the latter's colonial policy. The congress
called for an end to arms deliveries to both coun-
tries. The congress also went on record as favoring
improved trade relations and closer nongovernment
ties with East Germany.
The government's moves toward eventual recogni-
tion of North Vietnam were met with general satis-
faction, and no demands for speedier action were
made. The congress also supported the convening of
a conference on European security, but adhered to
the government's reservation that a satisfactory out-
come of the Berlin talks would have to precede mul-
tilateral preparations for any such conference.
(continued)
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The smooth progress of the Labor Party congress
is a great success for Bratteli, particularly in re-
gard to the EC issue. He will probably use the con-
gress' mandate on membership negotiations to keep
reluctant Labor legislators in line when Parliament
debates EC entry later this month.
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HUNGARY: Government changes announced yester-
day will have the effects of upgrading profession-
ally oriented technocrats and demoting a few high-
ranking party officials of dubious qualifications.
Even though the recent national elections pro-
vided party chief Radar an excellent opportunity for
major changes, he again avoided any but the most
pressing shifts of key personnel. Both the defense
and foreign ministers, who respectively have serious
health and image problems, were probably kept in of-
fice only because of Radar's aversion to unsettling
the internal balances in his regime.
The most important demotion was the transfer
of Antal Apro from deputy premier in charge of CEMA
relations to a formalistic post as president of the
national assembly. This resulted in the dropping
of the old president, politburo member Gyula Kallai,
from the government. Both men were past the legal
retirement age and had been ineffective. Apro's
failings were particularly serious because of the
Hungarians' stake in influencing reforms within
CEMA. Apro's replacement is Peter Valyi, a younger
economist who had served as finance minister since
1967.
Other changes include the appointments of
younger professionals to head the ministries of
light and heavy industry and to replace Valyi as
finance minister. The new ministers will probably
be more flexible and responsive to economic reforms
than were their predecessors. In consonance with
Radar's policy of involving highly qualified non-
Communists in the government, two new ministers are
former members of now defunct liberal-nationalist
parties.
One other noteworthy change was the appointment
of Imre Miklos to head the office for church affairs.
Miklos, like his predecessor retired minister Jozsef
Prantner, is an advocate of tou h but era atic pol-
icies toward the churches.
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JAPAN - COMMUNIST CHINA: Peking's efforts to
broaden contacts with important Japanese groups has
heightened popular sentiment for improved ties with
China.
Wang Hsiao-yun, political leader of the Chinese
ping pang delegation which recently ended a month-
long visit to Japan, met with a wide variety of
Japanese including ruling conservative party offi-
cials and business leaders. He also extended numerous
invitations for unofficial visits to the mainland,
and the way may now be open for a resumption of
large-scale exchanges.
In addition to seeing Peking's well-known friends
in labor and the opposition parties, Wang reportedly
held unprecedented meetings with two leading conserv-
ative aspirants for the prime ministership to sound
out their attitudes toward improved relations with
China. Meetings were also held with the chairman of
the Buddhist-based Komeito party and a wide spectrum
of business leaders, ranging from textile industry
leaders to a top-level group of Tokyo businessmen
close to Prime Minister Sato.
The skillful Chinese diplomacy during the visit
appears to have projected a friendly, reasonable im-
age of China and largely dispelled lingering uneasi-
ness in Japan resulting from excesses of the Cultural
Revolution. The Chinese avoided political subjects
and refrained from public attacks on the Sato govern-
ment. The favorable public reaction to extensive
media coverage of the Chinese visit clearly has fur-
ther increased pressure on Prime Minister Sato to
take a more positive stance on the China issue.
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ANGOLA: The morale of the Angolan Revolutionary
Government in Exile (GRAE) apparently is at a new low
because of an allegedly critical shortage of material
and financial resources.
GRAE leader Holden Roberto reportedly believes
that drastic measures will be necessary to prevent
the disintegration of the Congo-based Angolan insur-
gent organization.
As an economy move, Roberto has ordered many of
the GRAE units along the Congo-Angolan border to
"live off the land." He also plans to send his family
out of the country in preparation for a showdown with
President Mobutu and with other GRAE leaders, who have
become increasingly disenchanted with his leadership
and with GRAE's marked lack of success against Portu-
guese forces.
Roberto probably hopes to persuade Mobutu, his
major benefactor, to reverse a decision of last Decem-
ber that cut in half the Kinshasa government's monthly
subsidy to GRAE. Roberto may stop short of a press
conference because he is aware that Mobutu would
probably resent a public appeal for assistance. He
also may believe that in the end Mobutu will give some
additional support for the insurgents in order to
maintain his pronationalist credentials with black
African states. Roberto, however, is unlikely to
obtain much additional aid from the OAU, which has
long favored the more militant, pro-Soviet Popular
Movement for the Liberation of Angola
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SIERRA LEONE: President Stevens, very much on
top after his near ouster in March, continues to
pursue a vindictive hard line against his opponents.
His foes, however, are in disarray, and Stevens
is now sufficiently secure to permit the return home
of half of the 200 Guinean troops whose timely ar-
rival enabled him to survive ?a coup attempt in March
and reassert his authority. Nevertheless, Stevens
remains apprehensive and is using his newly acquired
and near-dictatorial powers to maintain the pressure
on opponents.
Two leaders of the party faction that challenged
him last fall remain in jail uncharged. Moreover,
the 12 political opponents whose convictions in 1967
on treason charges were overturned this week by an
appeals court will remain under detention because
Stevens has ordered new charges brought against them.
Meanwhile, the secret court martial of former army
commander Bangura and other officers implicated in
the attempt to overthrow Stevens is proceeding. Many
will probably be sentenced to death.
Stevens, concerned about his badly eroded popu-
lar base and the country's worsening economic situa-
tion, is making some attempts to mend political fences.
He passed over his most trusted political ally for
the post of vice president in an effort to appease
a large tribal bloc of supporters previously unrep-
resented in the leadership. More attention also is
being paid to party organization, and prominent
citizens are being pressed into joining the ruling
party in an effort to refurbish its image and, per-
haps, to create a bandwagon effect.
Efforts to transform the army into a reliable
instrument of the government have so far been largely
unsuccessful, and Stevens remains concerned about
its loyalty. He has talked of creating a popular
militia. Nevertheless, Stevens appears to control
sufficient force to maintain his position at this
time, and few within the country now dare challenge
him openly.
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MEXICO-GUATEMALA: Terrorism and security were
the major topics discussed by Presidents Echeverria
and Arana during their meeting at the border on 8
May.
Although their joint communique did not mention
the topic, Guatemalan Foreign Minister Herrera told
the US ambassador that the guerrilla-terrorist prob-
lem dominated the meeting. President Echeverria re-
portedly queried Guatemalan President Arana exten-
sively on the origin and development of the guerrilla
movement and on the counterinsurgent effort. He then
gave Arana a rundown on his recent expulsion of So-
viet diplomats following the discovery of a guerrilla
plot. Echeverria promised to crack down on Guatema-
lan exiles operating in Mexico and even told Arana
that Mexico would "cease to be a bridge between Cuba
and the insurgents of Latin America."
Herrera's version of Echeverria's positions
seems consistent with the Mexican President's very
strong anti-Communist line and his sensitivity re-
garding subversive activity. A high official in the
Mexican foreign office earlier this week told a US
official that relations with Cuba had cooled consid-
erably over the past year and that no progress had
been made on renewing the bilateral civil air agree-
ment that Mexico denounced last July.
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GOLD: Gold markets were active this week in
response to the international monetary situation.
Yesterday free market gold prices reached
$41.30, the highest level since October 1969. The
increase stems more from a lack of sellers than a
preponderance of buyers. Both uncertainty regarding
the future of the international monetary system and
recent purchases of $422 million of US Treasury gold
by the central banks of Belgium, the Netherlands
and France contribute to the unsettled market. These
purchases bring the US monetary gold stock to its
lowest level since World War II, covering less than
one quarter of US short-term liabilities to foreign-
ers.
The recent upward movement of the free market
gold price, however, in no way portends the imminent
collapse of the two-tier system, where monetary au-
thorities deal in gold at $35 per ounce, but supply
and demand determine the free market price. Until
German and Dutch currency parities are refixed, how-
ever, the free market price of gold probably will
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NOTES
CEYLON: Military leaders believe they now have
the situation under control, but realize the insur-
gency is far from over. Their offensive against the
insurgents in the back country appears to be limited
to patrols, mostly along the main trails. Military
chiefs estimate that over 1,000 rebels are holding
out in various pockets around the island, with an
unknown, but probably large, number of others lying
low in Colombo.
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CHILE: Despite Allende's strict price control
program, consumer prices increased 2.5 percent last
month, slightly more than during April of last year.
While this year's total price increase has been only
six percent compared with 19 percent during the same
period in 1970, the sharp increase in inflationary
pressures caused by the regime's economic policies
will make it increasingly difficult to hold the line
on prices. Because declining foreign exchange re-
serves will limit the government's ability to import
adequate supplies, Allende may soon be faced with
choosing between inflation and shortages.
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