CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A021300030001-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: December 14, 2016
• Document Release Date: April 21, 2003
• Sequence Number: 1
• Publication Date: February 26, 1972
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
N?- 41
26 February 1972
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No. 0049/72
26 February 1972
Central Intelligence Bulletin
ISRAEL-LEBANON: Israelis stage one of biggest re-
prisals since 1967 war. (Page 1)
MALTA-UK: Mintoff resumes talks in London. (Page 2)
CHILE: Military examines possible consequences of
termination of US arms sales. (Page 3)
SPAIN-USSR: Spanish officials anticipate trade
agreement next month. (Page 4)
ZAIRE: Mobutu reshuffles cabinet and party politi-
calbbureau. (Page 5)
BOLIVIA: Nationalist Revolutionary Movement holds
irk' st full convention in eight years. (Page 6)
PAKISTAN: Devaluation rumors (Page 7)
DAHOMEY: Situation following coup attempt (Page 7)
THE NETHERLANDS: Metalworkers strike ends (Page 8)
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Israeli Retaliation
LEBANO
vtlIages
=ale
SYRIA;
AI Mafrag
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ISRAEL-LEBANON: The two-pronged attack into
southern Lebanon yesterday, in retaliation for the
death of two Israeli civilians and an Israeli army
officer, was one of Israel's biggest punitive op-
erations against any Arab country since the 1967
war.
A mechanized battalion, augmented by close air
support, seized and searched three towns in central
southern Lebanon. A number of houses were destroyed
and some prisoners taken before the force withdrew.
At the same time, the Israelis hit fedayeen bases on
the slopes of Mount Hermon with artillery and an es-
timated 40-50 aircraft. Fedayeen losses are believed
to be high, and the Lebanese Army lost at least one
soldier even though it did not directly engage the
Israelis. The Israelis suffered no casualties.
Lebanese officials are dismayed by the magni-
tude of the raids in the face of what they describe
as their strenuous efforts to control fedayeen ac-
tions. They say they are unable to prevent the fed-
ayeen from infiltrating Israeli territory. The Is-
raelis publicly claim, with substantial accuracy,
that there is an agreement between Beirut and feda-
yeen leaders that there will be no firing into Israel
from Lebanese territory and that, in return, the
Lebanese will grant the fedayeen bases in Lebanon
from which the fedayeen can infiltrate into Israel.
Acting Prime Minister Yigal Allon said over Jerusalem
radio that Israel sees absolutely no difference be-
tween the two conditions and that it will continue
to take direct action if the Lebanese do not control
the terrorists.
Beirut has called for a UN Security Council
meeting for this morning. With popular pressures
building up over the approach of parliamentary elec-
tions, this is the least the government can do.
Central Intelligence Bulletin
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L/ZTA-UK: Prime Minister Mintoff will resume
negotiations with British Defense Secretary Lord
Carrington today prior to meeting with Prime Minis-
ter Heath on Monday.
At Mintoff's insistence, the British have given
assurances of an open agenda and have agreed reluc-
tantly to an Italian presence at the talks. Sunday
is presently scheduled to be a "day off" to allow
the negotiators time to consider today's develop-
ments. The British will stand by the final UK-NATO
offer of $36.4 million annually, plus bilateral aid,
and the allied position on foreign military use of
Malta. An agreement still appears possible, how-
ever, if both sides show flexibility on bilateral
issues, particularly those concerning the terms of
local employment.
If the talks succeed, Mintoff will have a set-
tlement that most Maltese will view as an immense
achievement. If the negotiations fail, he will be
able to claim that he has made an extra effort and
then try to shift the blame for failure to T,ond nn_
Central Intelligence Bulletin
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CH E: Military officers are studying the pos-
sible consequences of a complete break with the US
as a source of military equipment, possibly as jus-
tification to refuse a Soviet arms offer.
Materiel commands of all services reportedly
were ordered on 18 February to prepare a detailed
study of the ramifications, especially economic, of
a total refusal on the part of the US to sell Chile
military equipment. The study is to be predicated
on the assumption that Chilean acceptance of a re-
puted Soviet offer of arms credits
would cause the US to react wi an immediate sus-
pension of all military sales to Chile. The time
limit for the study is not yet known, but the con-
clusions are to affect the decision whether to ac-
cept the Soviet offer.
There is still no confirmation that the Soviet
arms credits have been raised I from
thel offer ma a as year.
Whatever the final amount, the ultimate decision
whether to accept the offer has not yet been made.
While the military study will be an important fac-
tor, the decision will be determined primarily by
political considerations.
Discussing Chile's surprise decision on 24
February to start overdue payments on its debt to
the Kennecott Copper Corporation, a Chilean offi-
cial reportedly claimed that the decision was at
least partly due to fear of attachment of military
funds on deposit in the US for the purchase of US
spare parts. This consideration is unlikely to
have been a major factor in the decision to pay
Kennecott. The reference to it, however, is a
sign that the government wishes to keep military
links with the US open or to shift the blame for a
possible future parts shortage to US rather
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SPAIN-USSR: Spanish Foreign Ministry officials
rep'Srtedly are optimistic that agreement will be
reached next month on the establishment of trade re-
lations with the Soviets.
The third round of Spanish-Soviet trade talks,
scheduled to begin in Paris on 13 March, may also
explore consular relations
Efforts to negotiate a commercial-
consular agreement in March and July of last year
foundered on Moscow's wish for a larger number of
personnel for its proposed consulate in Madrid than
the Spanish were willing to allow.
In keeping with Spain's policy of normalizing
relations with all countries, regardless of ideol-
ogy, cultural and economic contacts have increased
in the last year or two. This has occurred in spite
of ideological differences and the residual ill
will caused by the USSR's role in the Spanish Civil
War. Limited rapprochement also accords with Mos-
cow's European detente policy.
While the value of trade with the USSR has
more than doubled since 1960 to approximately $14
million in 1970, it still amounts to only one per-
cent of the total, so that the USSR represents a
largely untapped market for Spain's burgeoning ex-
ports. One reason for this stagnation has been So-
viet recourse to a clearing account arrangement to
balance bilateral trade. Spain would prefer that
payments be in convertible currencies on a multi-
lateral basis, but it is unlikely that the Soviets,
given present pressures on their foreign exchange
reserves, would agree to more than token payments
in hard currency.
Spanish-Soviet relations are expected to fol-
low the pattern Spain has used in improving rela-
tions with Eastern Europe. Hence, the signing of
a commercial pact would precede a consular agree-
ment and the exchange of consular representatives.
Madrid has yet to undertake formal diplomatic rela-
tions with an East European country.
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ZAIRE: President Mobutu Sese Seko's current
campaign to tighten up his government stems more
from a need to increase administrative efficiency
than from political reasons.
Mobutu announced on 21 February that he had
reshuffled his cabinet and the political bureau of
the official political party. He replaced six cab-
inet ministers, shifted three others, and moved
several vice-ministers up to ministerial posts.
The new cabinet is stronger than its predecessor
in technical and administrative expertise and could
be a plus for Mobutu at a time of general economic
malaise in Zaire.
The reduction in the party political bureau
from 35 to 15 members, with seven holdovers, should
produce a policy-making body more responsive to
Mobutu's drive to forge national unity. Although
a number of senior politicians were dropped from
the bureau, it now appears to strike a better bal-
ance between national and regional interests and to
open broader contacts with special groups such as
youth and intellectuals.
Mobutu also ordered last week that senior cab-
inet and party officials, provincial governors, and
directors of state enterprises desist from hiring
personnel on the basis of family, tribal, and re-
gional connections. He informed the officials con-
cerned that he would review all appointments. On
this issue, however, Mobutu is challenging tradi-
tion, and he is likely to meet with widespread foot-
26 6 Feb 72 Central Intelligence Bulletin
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BO IVIA: The national convention of the Na-
tionalist Revolutionary Movement (MNR) got under
way in La Paz yesterday despite demands from dis-
sidents that it be postponed.
It is the full party's first public convention
since the overthrow of Victor Paz Estenssoro's gov-
ernment in 1964. After almost seven years of inter-
nal feuding in opposition, most of the MNR joined
with some old enemies, the armed forces and the
Falange, to overthrow President Torres last August.
The party has since returned to partial power
through participation in President Banzer's coali-
tion government.
The MNR remains Bolivia's only true mass party
and the most cohesive political force in the nation
after the military. It is still rife with dissen-
sion, however, and its precarious unity may be se-
verely strained by the convention. Internal con-
flicts are ideological, political, generational,
and personal.
The key figure remains Victor Paz, still the
personification of the party and a past master of
political intrigue. Whether he leads the party
down his chosen path or merely adapts to the pre-
vailing winds, it seems fairly certain that Paz
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% PAKISTAN: Widespread rumors of an impending
currency evaluation have contributed to a ten-
percent rise in the price of gold in the last ten
days. The rumors stem from the annual visit of an
International Monetary Fund (IMF) team to Pakistan.
According to press reports, the IMF team has been
detailing measures necessary for Islamabad to qual-
ify for a standby credit to strengthen its foreign
exchange reserves. The IMF for several years has
been urging Pakistan to devalue as a means of easing
continuing balance of payments problems and correct-
ing the misallocation of foreign exchange resources
caused by the complicated multiple exchange rate
system Pakistan uses in foreign trade. The World
Bank and the Aid-to-Pakistan Consortium also have
urged devaluation. President Bhutto probably re-
alizes that he cannot avoid this step if he hopes
to gain needed international aid.
DAHOMEY: The ruling civilian triumvirate
headed by President Maga remains in power following
an attempted coup on 23 February by dissident army
officers. The coup move began with an early morning
attack on the-army chief of staff, and ended with
the negotiated surrender late in the day of rebel-
lious elements based in the army camp in Cotonou.
Eight junior officers and noncoms were subsequently
arrested, but senior officers who probably master-
minded the affair so far have not been touched, ap-
parently because the government fears provoking
further military action. Despite the government's
success in defeating this threat, competition for
power will continue among Dahomey's military_,~,Lnd
civilian factions.
(continued)
26 Feb 72 Central Intelligence Bulletin
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THE NETHERLANDS: The end of the 17-day-old
wildcat strike by socialist metalworkers in Amster-
dam and Rotterdam has saved the Biesheuvel govern-
ment from breaking with its policy of noninterven-
tion, a step that might have disrupted the stabil-
ity of the coalition cabinet. In an effort to re-
gain control of its restive rank and file, the so-
cialist trade union leadership had threatened to
ignore the accepted practice of industry-wide bar-
gaining and to negotiate directly with individual
firms if the workers' demands for increased vacation
pay were not met. Because the differences in nego-
tiating positions were narrow, the harried union
leaders finally agreed to binding arbitration that
resulted in a generally favorable settlement that
includes an 11.7--percent negotiated wage increase.
The settlement represents a blow to the government's
battle against inflationary pressures and could set
26 Feb 72 Central Intelligence Bulletin
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