CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A019700020001-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 15
• Document Creation Date: December 15, 2016
• Document Release Date: February 25, 2004
• Sequence Number: 1
• Publication Date: August 3, 1971
• Content Type: REPORT

Approved For Release 2004/04/19 : CIA-RDP79T00975A019700028sefet
25X1
DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
N2 42
3 August 1971
State Department review completed
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
 25X1 Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Approved For Release 2004/04/ (q*fgP79T00975A019700020001-1
No. 0184/71
3 August 1971
Central Intelligence Bulletin
CONTENTS
USSR - EASTERN EUROPE: The Crimean meeting was meant
to highlight Romania's isolation. (Page 1)
COMMUNIST CHINA: Confirmation of the purge of Chen
Po-ta. (Page-3)
CEYLON: Speculation about a possible coup.
(Page 6)
CHILE: Allende reportedly is blaming the US for
Chile's economic problems. (Page 7)
FRANCE: Opposition to additional special drawing
rights. (Page 8)
TURKEY - COMMUNIST CHINA: Opposition to recognition
Page 9)
UN-PEACEKEEPING: Soviet wish to resume bilateral
talks (Page 9)
ICAO - SOUTH ASIA: Dispute between India and Paki-
stan (Page 10)
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Approved For Release 2004/04/1 ,, 1 I79T00975A019700020001-1
C USSR - EASTERN EUROPE: Yesterday's meeting of
three top Soviet leaders with counterparts from all
their East European allies save Romania was meant
to highlight Bucharest's isolation and to put pres-
sure on it to conform to Soviet foreign policy.
The communique does not directly threaten or
even mention Romania. Its formulations on intra-
Bloc relations and Bloc foreign policy are generally
routine, but the broad range of topics covered,
from economic integration in CEMA to Vietnam and
the Middle East,_formalizes the seemingly informal
vacation gathering in the Crimea and underscores
Romania's deviant status.
Frequent bilateral meetings of Soviet and East
European leaders in the past month were capped by
a CEMA summit in Bucharest last week. Thus, there
is scant substantive reason for consultations, ex-
cept for Romanian recalcitrance. Indeed, there is
reason to believe that the meeting was called quite
abruptly. East Germany's Honecker had been on vaca-
tion but was reported in yesterday's press as having
met, presumably on 1 August, with the Soviet ambas-
sador in East Berlin.
Romania has irritated Moscow in recent years
by not siding with the Warsaw Pact positions on the
Middle East war and Soviet disarmament proposals.
Romania also has resisted Soviet plans to integrate
CEMA, and did not supress its delight that this
goal, as defined at the CEMA summit last week, will
take 15 to 20 years to implement.
Perhaps Ceausescu's greatest present sin, how-
ever, is to insist upon neutrality in the Sino-
Soviet dispute, to cultivate good relations with
Peking, and to welcome the thaw in Sino-US rela-
tions. The USSR is gravely worried about the dan-
gers to Soviet interests which it sees in a possible
rapprochement between Peking and Washington, and it
suspects that Romania has assisted in nourishing
3 Aug 71 Central Intelligence Bulletin 1
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
 Approved For Release 2004/04/19 : -UT9T00975A019700020001-1
C these contacts. Unable to stop the Chinese, Moscow
is determined at least to force the Romanians back
into line.
The Romanians, judging by their recent behavior,.
have not been expecting a sharp squeeze from the So-
viets. Earlier this summer, the Romanians were ap-
prehensive that Moscow would try to force them into
participating in a joint military exercise in.Bul-
garia or, alternatively, to permit Soviet troops
bound for the exercise to cross Romanian territory.
Such reports have died out and there are no indica-
tions that the Soviets have reopened the matter of
Romanian participation in the forthcoming exercise
in Bulgaria.
Having carried their dispute with Romania into
the open in this fashion, however, the Soviets are
not likely to let the matter rest. If Romania does
not cease its misbehavior, Moscow may step up eco-
nomic pressures, and insist on closer adherence to
the Warsaw Pact's foreign policy goals. Ceausescu
will be reluctant to appear to give ground under at-
tack, but he may well decide to ul his horns
for a time.
3 Aug 71 Central Intelligence Bulletin
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Approved For Release 2004/04/19 St~,9T00975A019700020001-1
COMMUNIST CHINA: The purge of leftist polit-
buro member Chen Po-ta, whose political demise ap-
parently is intended to symbolize Peking's repudia-
tion of extremist policies both in domestic and in-
ternational affairs, has been confirmed by a Chinese
official.
c now e ge
that Western press reports of Chen's
rumored purge were correct and that Mao Tse-tung
had been alluding to Chen's failings in his inter-
view last December with American journalist Edgar
Snow. In that interview, Mao condemned "hypocrites"
who told lies during the Cultural Revolution, de-
plored the maltreatment of many former party cadres,
and endorsed the accuracy of foreign press reports
of internal cha during the revolutionary period.
implied that the intent of Mao's
emares was to dissociate himself from the excesses
perpetrated by the radical ideologues in his en-
tourage, particularly by Chen Po-ta, who had been
Mao's personal secretary and was originally appointed
by him to lead the Cultural Revolution Group.
Although Chinese media have yet to denounce
Chen officially, there have been ample indications
in recent months that Peking is seeking to persuade
both domestic and foreign audiences that the in-
fluence of the leftist forces represented by Chen
is on the wane. These signs include the increasing
publicity accorded the year-old campaign against
reputed followers of the extremist "May 16 Corps"--
which Chen allegedly organized--and repeated apol-
ogies to Western diplomats in Peking for excesses
perpetrated against foreign missions in the summer
of 1967, the period when the May 16 group was riding
high.
(continued)
3 Aug 71 Central Intelligence Bulletin
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
25X1
25X1
 Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
SECRET
It is still uncertain whether Peking intends to
make Chen a public scapegoat for the May 16 group's
extremism.
because other politburo
members, including Madame Mao and Kang Sheng, also
were involved, Peking may be reluctant to risk ex-
posure of the full extent of leadership disunity
through an open pillorying of Chen.
At this stage, Peking's handling of the down-
fall of Chen Po-ta reflects the marked shift to the
right that has occurred in the bitter struggle over
power and policy within China's unsettled leadership
coalition since the ninth party congress two years
ago. The issues involved have been complex but
clearly have included attempts by the leftists in
Mao's inner circle to weaken Chou En-lai, to resist
the reinstatement of many veteran party and govern-
ment officials, and perhaps also to thwart the move-
ment of China's foreign policy in several areas in
the direction of more moderation and flexibility.
The case against Chen Po-ta and the "May 16 Corps"
over the past year appears to have been accompanied
by a corresponding strengthening of Chou En-tai's
personal position, although the ranking of Madame
Mao just behind Chou and ahead of Chief of Staff
Huang Yung-sheng at the Army Day celebrations last
weekend suggests that the jockeying between leftist
and moderate elements within the regime has not
ceased.
3 Aug 71 Central Intelligence Bulletin
SECRET
25X1
25X6
25X1
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 25X6 Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Approved For Release 2004/04/191,79T00975A019700020001-1
CEYLON: Deteriorating economic conditions and
rumors an early renewal of insurgency are. leading
to increased speculation about a possible coup.
Much of the reporting focuses on General Don
Sepala Attygalle, the commander of the army. Atty-
galle has been described as an extremely ambitious
opportunist who at one time believed Ceylon needed
a "modified" form of democracy in order to maintain
stability. He is also said to be overworked and
under great mental stress as a result of the insur-
gency.
In recent weeks, the general has been causti-
cally critical of the politicians who, he complains,
are a frustration for anyone attempting to do good
for the country. Attygalle appears to have no
strop political attachments but
lhe would
e e ieve t e countr were going further toathelf
left.
with Att a coup,
yga e backing Prime Minister. Bandaranaike
in an attempt to move the government to the right,
would be possible.
Rumors of possible military coups are heard oc-
casionally on Ceylon. The present economic and po-
litical situation, combined with the personality of
Att alle gives added weight to the present reports.
3 Aug 71 Central Intelligence Bulletin 6
SECRET
25X1
25X1
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
 Approved For Release 2004/04/19?E~IZDP79T00975A019700020001-1
ET_
CHILE: President Allende reportedly is begin-
ning to lame a US-"boycott" of Chile for his in-
creasingly serious economic problems,
He is privately asking Chilean businessmen for
unity in the face of "an impending confrontation
over copper nationalization and other issues." At
the same time, industrialists complaining about the
adverse impact of a recent partial devaluation on
firms making payments to foreign banks, mostly US,
were advised by the minister of economy to simply
"not pay and see what happens."
The most pressing problem in Chile is the short-
age of important consumer goods. Beef, pork, poultry,
and eggs are in especially short supply, and a black
market is developing. The sharply increased demand
resulting from Allende's populist policies is also
causing some shortages of textiles and other manu-
factured goods. Chile's ability to meet consumer
demands by expanding imports is increasingly being
limited by dwindling foreign exchange reserves and
a drying up of foreign credits. E Moreover, copper
exports--already depressed by managerial problems
and poor worker discipline--are now being affected
by a strike at the recently nationalized El Salvador
mine; the mine is Chile's third largest and accounts
f
or about 15 percent of total output.]
3 Aug 71 Central Intelligence Bulletin
SECRET'
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
25X1
 Approved For Release 2004/04/19 sRI[9T00975A019700020001-1
FRANCE: The government recently announced that
it will oppose the creation of additional special
drawing rights, a new form of international reserve
activated in 1970.
The present agreement, which provides for al-
locations totaling $9.5 billion over a three-year
period, expires at the end of 1972. Special drawing
rights were created to ensure steady growth of world
liquidity envisaged at approximately seven percent
a year and to supplant eventually other major assets
such as gold and foreign exchange. International
liquidity, however, increased at the annual rate of
18 percent in 1970 and at an even faster rate during
the first half of 1971 because of the massive infu-
sions of dollars that resulted from unexpectedly
large US balance-of-payments deficits over the past
two years.
Western European nations, and especially the
countries of the European Communities (EC), have
become increasingly frustrated by failure of the US
to slow the dollar influx, which has had an infla-
tionary impact on the European economies. This frus-
tration could prompt other major countries to rally
behind the position of Paris by the time a new agree-
ment is negotiated. A voting power bloc of 15 per-
cent, which could be mustered by the EC alone, is
all that would be required to veto a proposal for
further large allocations. F__ I
3 Aug 71 Central Intelligence Bulletin
SECRET
25X1
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Approved For Release 2004/04/19 .. ti`/bT00975A019700020001-1
TURKEY - COMMUNIST CHINA: Recognition of Com-
munist China, which was to have been announced this
week, may be temporarily delayed by opposition in
Parliament. The chairman of the Senate's foreign
relations committee has publicly attacked recogni-
tion, claiming it would have a bad effect domestic-
ally at a time when the government is attempting
to stifle Maoist-oriented subversives. A majority
of the members of the Senate and Lower House foreign
relations committees reportedly oppose recognition
and a joint meeting of the two groups will convene
within a few days. The parliamentarians will prob-
ably ask Prime Minister Erim to defend his China
policy and may consider calling for Foreign Minister
Olcay's resignation.
25X1
F
UN-PEACEKEEPING: In spite of the Soviets' re-
cent negative response to the 1970 US paper on peace-
keeping, they evidently wish to resume bilateral
talks on the subject. In a recent conversation with
the US delegation to the UN, Soviet mission offi-
cials referred several times to "impending changes"
in the Security Council--i.e., the prospective seat-
ing of mainland China--and implied that it would be
desirable if an agreement could be reached before
these changes occurred. In urging that the bilateral
talks continue, the Soviets may also fear that the
US will decide to join at the General Assembly with
other countries, such as Canada, in sponsoring peace-
keeping proposals unpalatable to Moscow. However,
as long as Moscow clings to the rigid position it
reiterated only last month that the Security Council
must exercise full and exclusive control over a
peacekeeping mission, it remains difficult to see
how any compromise can be reached. F_ I 25X1
(continued)
3 Aug 71 Central Intelligence Bulletin
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
 Approved For Release 2004/04/19 5]BU4 th 9T00975A019700020001-1
ICAO - SOUTH ASIA: The dispute between India
and Pakistan in the International Civil Aviation
Organization (ICAO) may now be referred to the In-
ternational Court of Justice (ICJ)--with attendant
publicity and aggravation of existing tensions be-
tween the two countries. Last February before the
civil war in East Pakistan, India banned Pakistani
overflights in retaliation for the hijacking to
Pakistan of an Indian commercial aircraft by a group
of "Kashmiri freedom fighters." Islamabad appealed
the ban to the ICAO Council, which last week rejected
New Delhi's contention that the council lacks juris-
diction. In view of this setback, Indian Foreign
Secretary Kaul has told the US his government will
probably take the matter to the ICJ. 25X1
3 Aug 71 Central Intelligence Bulletin
SECRET
Approved For Release 2004/04/19 : CIA-RDP79T00975A019700020001-1
 25X6 Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1
 Si ted For Release 2004/04/19: CIA-RDP79T00975AO19700020001-1
Secret
Approved For Release 2004/04/19 : CIA-RDP79T00975AO19700020001-1