CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A019000100001-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 14, 2016
• Document Release Date: July 28, 2003
• Sequence Number: 1
• Publication Date: May 18, 1971
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
State Department review completed
Secret
N?_ 040
18 May 1971
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No. 0118/71
18 May 1971
Central Intelligence Bulletin
CONTENT S
USSR: Gromyko's remarks on force reductions. (Page 1.)
LAOS: The Communists are keeping up the pressure in
Bout ern Laos. (Page 3)
PHILIPPINES: Marcos may provoke antigovernment dem-
onstrations. (Page 4)
CYPRUS: Another period of intense political maneu-
vering is getting under way. (Page 5)
TRINIDAD-TOBAGO: Elections. (Page 6)
TANZANIA: Economic problems. (Page 7)
ITALY-FRANCE: The Czechoslovak issue is still divi-
sive in the communist parties. '(Page 8)
AUSTRIA - COMMUNIST CHINA: Diplomatic relations
(Page
ROMANIA: Ceausescu trip to Peking (Page 9)
USSR: Biological warfare stockpiles (Page 10)
SAUDI ARABIA: Faysal trip to Japan and Nationalist
China (Page 10)
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CHILE: Friction with creditors (Page 11)
BOLIVIA: 'Antigovernment front (Page 11)
VENEZUELA: Nationalization of gas resources (Page 11)
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AFGHANISTAN: Government resignation (Page 13)
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*USSR: In a meeting with Ambassador Beam yes-
terday, Foreign Minister Gromyko suggested that the
Soviets would be receptive to a Western proposal on
Mutual Balanced Force Reductions (MBFR), but he did
not significantly expand upon Brezhnev's recent pro-
posal to "start negotiations."
He did confirm that the USSR is now prepared
to discuss either foreign or foreign and indigenous
forces. The most interesting nuance was his sug-
gestion that the Soviets now favor negotiations on
MBFR independent of a Conference on European Secu-
rity (CES). The official Pact position has been
that MBFR could be considered either in a body to be
established by a CES or in any other acceptable
forum. He took care to note, however, that Moscow
did not accept the NATO concept of "balanced" re-
ductions, which could imply larger reductions in So-
viet than in NATO forces.
He was completely noncommittal in regard to
questions of timing, site, and specifics of negotia-
tions, and instead invited further discussion of
these questions between Washington and Moscow.
Gromyko's refusal to spell out the Soviet position
now suggests that Moscow intends for the moment to
leave the burden of initiative with the West.
*Because of the shortage of time for preparation of this item, the analytic
interpretation presented here has been produced by the Central Intelli-
gence Agency without the participation of the Defense Intelligence
Agency, Department of Defense.
18 May 71 Central Intelligence Bulletin 1
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Ban Nape
Pass
Mu Gia
Pass
Dong
Seno _-llene
Bolovens
Plateau
sit
t tENTIANE
Quan@ Tri
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LAOS: The Communists are keeping up the pres-
sure in southern Laos.
Yesterday they captured Dong Hene in the west-
ern panhandle with a heavy mortar and rocket attack.
The town was evacuated in an orderly fashion, and
government troops were able to take their artillery
with them. This is the farthest the Communists have
penetrated westward along Route 9 in several years.
They are now in a position to threaten the town of
Seno, some 20 miles to the west. Communist prison-
ers and ralliers have said that Seno would be a
target if Dong Hene fell. Communist forces in the
area are sufficient to permit continued movement
west along Route 9. If the Communists follow past
practice, they will undergo a period of consolida-
tion before undertaking major new activity. It may
therefore be at least several days before their in-
tentions become clear.
Sketchy reports indicate that a Pathet Lao
sapper battalion hit an ammunition dump in the Me-
kong River town of Paksane yesterday. Rocket fire
also hit the Paksane airfield. Although highly
vulnerable to Communist attack, Paksane heretofore
has been relatively free from enemy harassment.
In the Bolovens area, no major new Communist
attacks have been reported in the past 24 hours.
The Communists fired rockets into the now isolated
base at Ban Houei Kong, the only important site on
the plateau still in government hands. Three North
Vietnamese battalions reportedly were closing in on
that site yesterday.
18 May 71 Central Intelligence Bulletin 3
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PHILIPPINES: President Marcos' expected ef-
forts to use the upcoming constitutional convention
to extend his term of office will deepen public cyn-
icism and increase the likelihood of antigovernment
demonstrations.
The convention opens on 1 June with a broad
charter to change the Philippine constitution, sub-
ject to approval in a national referendum. Despite
public denials, the President and Mrs. Marcos are
busy pressuring delegates to support constitutional
changes that will further their ambitions. They are
considering extending the presidential term to six
years, in effect enabling Marcos to serve until 1975,
although no formula has been settled on. Marcos ap-
parently recognizes that he must move cautiously or
run the risk of generating further widespread public
opposition.
The leader of the opposition party believes
that if Marcos perverts the purpose of the constitu-
tional convention, there is a good chance that the
public will become openly hostile. Student radicals,
who have been claiming all along that constitutional
reform was a sham, have threatened to harass the
proceedings. Alert to this, Marcos over the weekend
directed the Philippine Constabulary to monitor dem-
onstrations, student teach-ins, and radio and TV
broadcasts, and arrest individuals making seditious
remarks. Although the President probably saw the
directive as a means to crack down on the radicals
without imposing martial law, the outcry in the
media suggests that this action will only strengthen
the radicals' hand.
18 May 71
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CYPRUS: Another period of intense maneuvering
is getting under way.
Several recent incidents have threatened to
end the intercommunal talks, now dragging into their
third year. Cypriot President Makarios started the
trouble with several public statements favoring
"enosis" (union with Greece), an issue he had allowed
to lie relatively dormant for the past few years.
The Turkish Government has replied by offering
strong support to the Turkish-Cypriot community, as-
serting that the intercommunal talks were proving
fruitless but deserved one "last chance." If, as
Ankara expects, the talks finally fail, the Turkish
Government proposes to sustain the Turkish Cypriots
as a separate, quasi-independent state and promises
an airlift if the Greek Cypriots in retaliation
should move to isolate the Turks on the island. Ma-
karios has vowed to prevent the establishment of a
separate Turkish-Cypriot state at all costs.
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Even if the Greek and Turkish governments could
reach agreement, it is still unlikely that Makarios
could be forced to accept their views. Makarios be-
lieves he can count on Soviet diplomatic support as
well as US and general UN pressures to fend off any
joint Athens-Ankara move with which he disagrees.
18 May 71
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TRINIDAD-TOBAGO: Prime Minister Williams'
ruling Peoples National Movement (PNM) is guaran-
teed victory in the general elections on 24 May.
The principal opposition coalition party col-
lapsed in confusion last week after its leader, A.
N. R. Robinson, unilaterally decided to boycott the
elections. The coalition leadership is bitter with
Robinson for deciding to withdraw. Local radical
groups have been urging a boycott, charging that
the government plans to manipulate the election
results.
The legitimacy of the elections is now the
main issue in the campaign, and the absence of a
large voter turnout could indicate that the PNM
has lost the public's confidence, but may more
accurately reflect voter apathy. According to the
US Embassy, only the radicals are likely to gain.
The possibility of postelection disturbances has
increased, but the security forces should be able
to contain any violence.
18 May 71 Central Intelligence Bulletin 6
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TANZANIA: The government has created some
potentially serious economic problems as a result
of efforts to put its financial house in order.
To cut down on excessive government spending
and on an outflow of foreign exchange, the govern-
ment implemented exchange controls in March and
decided to reduce development spending. In line
with these decisions, the National Bank of Commerce
recently placed a restrictive limit on overdrafts
for all customers. The State Trading Corporation,
which manages most of the country's import and ex-
port trade, and the National Development Corporation
(NDC), which controls the larger industrial plants,
were hit particularly hard by this policy. Because
of an apparent lack of intragovernmental coordina-
tion, both of the state corporations have had checks
bounced in the last two weeks, and some of the NDC's
companies may soon have trouble meeting their payrolls.
The small private sector is also feeling the
pinch because of credit restrictions and a loss of
income from buildings recently seized by the gov-
ernment without compensation. The mood within the
business community in Dar es Salaam reportedly is
gloomy, and business is at a "standstill." Local
traders are unable or unwilling to place any large
orders, and private building projects have come to
a halt, causing a rise in unemployment.
This economic uncertainty has generated a
plethora of rumors regarding further government
moves against the private sector, of dissension
within the government, and even of coups. The US
Embassy reports that the political situation is
"fundamentally stable," however, although the gov-
ernment will obviously have to take some remedial
steps soon to avert large layoffs of workers in
NDC enterprises. Moreover, in spite of its un-
skillful handling of the economy, the government's
fiscal position is still basically sound and, in
all likelihood, it will be able to muddle through.
18 May 71
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ITALY-FRANCE: The Czechoslovak issue is still
divisive in the Italian and French Communist parties.
The leaders of the Italian Party (PCI) have
been debating what level delegation to send to the
Czechoslovak Communist Party Congress opening on 25
May. Deputy Secretary General Berlinguer has sug-
gested sending only an "observer" who would deliver
a message restating the PCI's critical view of the
Soviet intervention in Czechoslovakia and of the
postinvasion "normalization" period. Pro-Soviet
elements in the nine-man PCI Politburo apparently
blocked this proposal, holding out for the dispatch
of a full, high-level delegation. The strength of
these elements is out of proportion to their numbers
because they are backed by strong Soviet endorsement.
The Italians have sought to coordinate their
policy on representation at the Czechoslovak con-
gress with the French Communist Party (PCF). The
issue has also caused disagreement within the PCF,
which reportedly has now decided to send Raymond
Guyot, a member of the PCF Politburo, presumably as
a compromise choice. Guyot meets the desire of pro-
Soviet elements for high-level representation, but
he is also associated by family ties with the Czech-
oslovak reformers of the Dubcek period.
The Czechoslovak issue is of fundamental im-
portance to both parties because it raises the ques-
tion of their independence from Moscow and of the
conflict between their national and international
loyalties. Over the past year, each of these par-
ties has been seeking to increase cooperation with
non-Communist parties at home.
18 May 71 Central Intelligence Bulletin
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NOTES
*AUSTRIA - COMMUNIST CHINA: Representatives of
the two countries have agreed in Bucharest on the
establishment of diplomatic relations. Agreement
on the text of a communique is based upon Austrian
acceptance of the People's Republic of China as the
"sole legal government of China"--a formula that
has been used in a series of previous reco nition
announcements. formal 25X1
announcement of diplomatic relations may be expected
as early as next week in the respective capitals.
ROMANIA:
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Press ent Ceausescu intends to
tour Peking, Pyongyang, and Hanoi, probably in
June. Ceausescu has traveled to Communist China
once before, but this would be his first junket to
the Orient as party and state chief. Despite the
inevitable objections from Moscow, Ceausescu prob-
ably has been considering for some time paying a
visit to his Chinese benefactors, who only recently
granted a sizable long-term loan to Bucharest. In
the Romanians' view such a trip is called for be-
cause of the steadily improving political and eco-
nomic relations with Peking, and it would help to
counterbalance Ceausescu's private tour of the US
last fall. Ceausescu also will go to Finland in
late June
*Because of the shortage of time for preparation of this item, the analytic
interpretation presented here has been produced by the Central Intelli-
gence Agency without the participation of the Defense Intelligence
Agency, Department of Defense.
18 May 71
(continued)
Central Intelligence Bulletin 9
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USSR: Recent remarks by aSoviet official are
the first admission that the Soviet Union has bio-
logical warfare stockpiles. V. V. Shustov, deputy
chief of the Soviet delegation to the Geneva Dis-
armament Conference, asked a US delegate whether the
US would agree to a provision in the BW convention
requiring a report of the destruction of BW stocks.
When Shustov was asked if the Soviet Union would
submit such a report and whether there would be
destruction to report, he replied affirmatively.
BW-related research and development in the USSR
have led US intelligence to assume that the Soviets
have BW stockpiles, but there is no physical evi-
dence to support the assum tion.
SAUDI ARABIA: King Faysal embarked Sunday on
a goodwill trip to Japan and Nationalist China, stop-
ping off at Tehran en route. Japan--a large consumer
of Saudi Arabian oil--has long urged Faysal to pay a
visit in order to strengthen contacts between the two
countries. Nationalist China welcomes such visits as
an illustration of its claim that Taipei enjoys world-
wide support. It is not known what other countries
would be included if the trip becomes a world-circling
tour, but present plans call for the King to be absent
until at least the latter part of May.
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CHILE: Recent expropriations of domestically
owned textile firms are causing friction with major
Western European creditors. The textile firms pre-
viously received credits guaranteed by official
German and French institutions and the issue of
repayment has raised government-to-government con-
troversies. Germany and France have taken the posi-
tion that the Allende administration is now respon-
sible for the loans and are pressing for payment.
Chile may be worried that such payments would es-
tablish a precedent, but out of concern for its
credit standing in Western Europe, the government
probably will find some way to meet these debts.
BOLIVIA: Increasing evidence that dissident
military and political groups are making progress
toward the formation of a common antigovernment
front may lead to pre-emptive moves by President
Torres. The lack of organization and preparedness
of these forces, which are concerned about the
regime's leftward drift, makes immediate action
unlikely. Torres has previously neutralized op-
position in its formative stages. A crackdown
now, however, could trigger an impulsive and un-
coordinated coup attempt.
VENEZUELA: Opposition is emerging against
plans by the government to develop natural gas ex-
ports. President Caldera's proposed legislation,
now being debated by Congress, would nationalize
the gas resources of foreign oil companies, apart
from the supplies needed for repressuring oil wells.
The companies charge that the bill violates their
concession agreements and are lobbying vigorously
to have it watered down. At the same time, some
Venezuelans are questioning planned government in-
vestment of $1 billion during the next four years
in the liquefaction of gas for export, a project
whose technology and profitability they feel have
not been fully demonstrated.
(continued)
18 May 71 Central Intelligence Bulletin
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AFGHANISTAN: The resignation on 16 May of
Prime Minister Etemadi and his cabinet is a result
of growing dissatisfaction in Parliament with their
generally weak performance. Etemadi-led governments
have held office since late 1967. Dr. Abdul Zahir,
a prominent politician and diplomat who is a close
friend of King Muhammad Zahir Shah, is Etemadi's
most likely replacement. The King, however, will
remain the dominant force, and the new government
in all likelihood will continue the country's cau-
tiously reformist domestic program as well as its
nonaligned international posture.
18 May 71 Central Intelligence Bulletin 13
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