CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A026000040001-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: December 15, 2016
• Document Release Date: November 3, 2003
• Sequence Number: 1
• Publication Date: January 10, 1974
• Content Type: REPORT

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Central Intelligence Bulletin
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January 10, 1974
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January 10, 1974
Central Intelligence Bulletin
CONTENTS
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ARAB STATES: Western bankers will assist the Arab
countries to invest surplus oil revenues. (Page 3)
LIBYA-ITALY: Libya may use oil as lever to secure
arms from Italy. (Page 4)
INTERNATIONAL MONETARY DEVELOPMENTS: Dollar's surge
ended abruptly yesterday. (Page 5)
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THAILAND: Students take to the streets again.
(Page 11)
BRAZIL-CHILE: Brazil to lend Chile $50 million.
(Page 12)
BOLIVIA: Political rival of President Banzer de-
ported. (Page 13)
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ARAB STATES: Western bankers will assist the
Arab countries to invest their surplus oil, revenues.
A joint corporation was formed this week between the
Arab Bank in Amman--the largest privately owned bank
in the Middle East--and a large British merchant
bank that has strong US ties, The new company will
help the Arab governments channel their capital into
such development projects as oil refineries and man-
ufacturing plants.
The participation of the Arab Bank should en-
courage investment by Arab governments that have ob-
jected to Western control of their assets. Some of
the Arab governments, moreover, lack the administra-
tive capability to handle such large volumes of cap-
ital effectively.
The new corporation is the second institution
to be set up in the past month to channel Arab funds
into development projects in the Middle East. The
first was in response to a call by the Arab League
to repatriate foreign deposits for investment in
Arab countries.
Jan 10 , 1974 Central Intelligence Bulletin
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LIBYA-ITALY: Rome is becoming increasingly
concerned that Tripoli will use Italian reliance on
Libyan oil as a lever to gain the release of 150
armored personnel carriers (APCs) contracted for in
early 1973 but not yet delivered.
Tripoli threatened i - ece er to
shut o oil supplies to Italy if delivery of the
APCs did not commence in the near future. The APCs,
Mll3s manufactured in Italy under US license, cannot
be exported without abrogating the US agreement.
Although the US did approve a sale in 1972 of APCs,
Washington has refused to sanction the new sale.
Rome's sale of 152 APCs to Tripoli in 1972
represented the first Western inroad into a Soviet
and Czechoslovakian monopoly on armored equipment
sales to the Qadhafigovernment. In addition,
Italy has provided Libya with helicopters, artillery,
and support equipment, and Italian firms have con-
tracted to supply naval radar and enlarge and mod-
ernize two Libyan airfields.
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A Libyan delegation that arrived in Italy ear-
lier this month is currently trying to arrange the
delivery of helicopters purchased last year. These
helicopters are also manufactured under US license,
but export approval has already been granted by
Washington.
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INTERNATIONAL MONETARY DEVELOPMENTS: The dol-
lar's surge in early January came to an abrupt halt
on European money markets yesterday. The sizable
gains of Monday and Tuesday were lost as the dollar
fell to its level of January 4.
Bonn's announcement that it was removing all
foreign exchange controls--introduced in 1972 to
slow massive dollar inflows--keyed the shift of
traders from dollars to other currencies. Other
factors in the reversal included an apparent easing
in Europe's oil situation--reflected in the post-
ponement of Germany's weekend driving ban--a reduc-
tion in Libya's previously reported posted oil price,
and intervention by both the German and Japanese
central banks. The only offsetting factor was the
news that the oil-exporting nations, meeting in
,Geneva, have decided to postpone until April 1 an
decision on oil rice changes.
Jan 10 , 1974
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C THAILAND: The arrival of prime Minister Tanaka
has brought students back into the streets of Bangkok
in numbers reminiscent of the riots last October.
Some 10,000 students held a mid-morning rally on Jan-
uary 9 to protest Japanese economic "imperialism."
During the demonstration, some 3,000 students broke
away from the main body to march on the US Embassy.
The students protested alleged CIA interference in
Thai internal affairs and demanded that Ambassador
Kintner leave the country. They dispersed later in
the evening, following assurances from the prime min-
ister's office that government officials would meet
with student leaders.
Thai students have been preoccupied with domestic
affairs in recent months and anti-US sentiment has not
been a major student issue. Student leaders have now
seized on the recent CIA letter episode as a means of
galvanizing public opinion and are pressing the gov-
ernment to take a hard line with the US over this in-
cident. Given the Sanya government's sensitivity to
student political pressure, some-type of formal. pro-
test may indeed be forthcoming.
Jan 10, 1974
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BRAZIL-CHILE: Brazil has signed an agreement
to provide a 450 million loan to Chile--considerably
less than the $200-million package that had been
discussed by the two governments last fall. While
the loan is technically "untied," there reportedly
is a clear understanding that it will be used to
purchase Brazilian goods and services.
Following Allende's overthrow, Brazilian offi-
cials expressed a willingness to provide virtually
any amount of assistance that the junta might need.
After an initial $26-million line of credit, however,
mostly for purchases in Brazil, the Brazilians became
hesitant about making extensive commitments.,. When
a Chilean economic team visited Brasilia to present
formal aid requests, Brazil merely agreed in prin-
ciple to its proposal for a $200-million loan package
and refused outright to guarantee new international
lines of credit.
A combination of factors may account for Brazil'.s
hesitation. Brazil may be reserving judgment as to
the junta's policy directions before making deeper
commitments, or it may hope that other nations--no-
tably the US--will begin providing Chile with enough
assistance to make a heavy commitment by Brazil un-
necessary. Brazil may also be reacting to Chile's
recent failure to support Brasilia's opposition to a
UN measure sponsored by rival Argentina. In addition,
officials of the Medici government, which is in its
final months, may not want to bind the next admin-
istration to such a substantial commitment.
Jan 10, 1974
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BOLIVIA: The exile of former president Victor
Paz Estenssoro marks the collapse of efforts to end
recent friction between Paz and the Banzer govern-
ment.
Paz, leader of the country's largest political
party, the National Revolutionary Movement (MNR),
was deported to Paraguay along with some of his ad-
visers following a meeting with the minister of in-
terior in which Paz apparently rejected an offer
to bring his party back into Banzer's coalition.
Last week Paz and President Banzer met for several
hours, but failed to reach an agreement.
The government's action does not come as a sur-
prise to Bolivians. There have been rumors that Paz
might be forced to leave the country ever since he
ordered his party to withdraw from the cabinet last
November. Some elements of the MNR stuck with Ban-
zer, however, and the President will probably try
to win over other tarty leaders with offers of jobs
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