NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A027400010016-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 15
• Document Creation Date: December 20, 2016
• Document Release Date: August 4, 2006
• Sequence Number: 16
• Publication Date: February 1, 1975
• Content Type: REPORT

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TOO secret
National Intelligence
Bulletin
State Dept. review completed
Top Secret
February 1, 1975
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National Intelligence Bulletin
February 1, 1975
CONTENTS
ARGENTINA: Political tension increases. (Page 1)
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CHINA: Australian Wheat Board announces sale of wheat
to China . (Page 4)
IRAN: Shah blames Western oil companies for reduction
of-Iran's exports. (Page 5)
USSR-US: Three high-level Soviets reiterate Moscow's
commitment to detente. (Page 6)
LATIN AMERICA: Venezuelans to pursue leadership role;
Perez may hold summit in Caracas next month. (Page 7)
USSR-EGYPT: Gromyko expects to take tough line in Cairo.
Page
ANGOLA: Transitional government installed. (Page 9)
ETHIOPIA: Insurgents attack government forces in Asmara.
(Page l0 )
PORTUGAL: Small groups of demonstrators marched through
Lisbon last night without serious incident; tensions as-
sociated with such rallies will continue. (Page 11)
FOR THE RECORD: (Page 12)
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President Peron's decision to cut short her summer
vacation and return to Buenos Aires appears to confirm
rumors that political tensions have reached a disturbing
level.
Reports of military opposition to key presidential
adviser Lopez Rega, imminent shifts in the cabinet, and
growing conflicts between Peronist labor leaders and
the government are fueling widespread speculation that
a major confrontation is in the offing. With strong
opposition to Lopez Rega apparently forming among the
military, Peronist labor, and the opposition political
parties, Mrs. Peron will be under great pressure to cur-
tail his power. The strength of military and labor
sentiment to continue to support the President is not
clear, but they are the critical factors in determining
her continuance in office The fear that chaos would
develop should Mrs. Peron resign rather than bow on this
issue may counsel restraint on the part of Lopez Rega's
opponents.
Lopez Rega thus could ride out the storm. He has
had uncanny success in outsmarting his enemies in the
past. There is a possibility that some face-saving com-
promise could be effected to play down his role and quiet
his critics--at least temporarily.
Adding to the President's immediate problems--and
to the widespread mood of disquiet in the capital--is
a new ultimatum from leftist extremists. They are
threatening to conduct a campaign of "indiscriminate
execution" of government officials and Peronist leaders
unless the police show publicly by Sunday night that 19
captured guerrillas are still alive.
Earlier, the discovery of a bomb within the compound
of Mrs. Peron's beach resort reportedly caused her to
move to a nearby naval base before returning to the
capital.
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The Australian Wheat Board has announced the sale
of about 1 million metric tons of wheat, worth about $150
million, to China, apparently under the current three-year
Sino-Australian wheat contract. Delivery will begin in
April and be completed in March 1976. Our estimate of
China's imports of grain from all sources for 1975 remains
at 5.6 million tons; the deal had been expected for some
time.
By buying Australian wheat at a price around $4.00
a bushel, Peking is cutting the costs of its wheat im-
ports over the next few months. The Australian Wheat
Board reportedly has been reducing export wheat prices
daily to keep them in line with or below those quoted
by US traders. The US price is now hovering around
f.o.b. $4.00 a bushel. The total cost will be less,
however, because shipping charges from Australia to
China are much cheaper. The Chinese would particularly
welcome lower grain import costs at this time because
of their current tight foreign exchange position.
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February 1, 1975
Tehran is trying to put the blame solely on pri-
vate Western oil companies for the reduction in Iran's
oil exports.
Officials in Tehran and the controlled Iranian press
claim that a decline in demand by the major Western oil
companies--the group of private companies that produces
and markets about 90 percent of Iran's oil--is responsi-
ble for the drop in oil exports. Iran's estimated oil
output and exports in January were about 10 percent--or
500,000 barrels a day--lower than the average in 1974.
While it is true that the companies have lowered
their oil liftings in response to world market conditions,
this accounts for only part of the cutback in Iran's ex-
ports. A good share of the cutback must be attributed
to lower sales by the government's National Iranian Oil
Company, which is asking over $11.00 a barrel, well above
the marketable value of Iranian oil.
Iran probably is engaged in a deliberate effort to
reduce its output and may well encourage similar efforts
by other Middle East producers, in hopes of eliminating
the oversupply of oil in the world market and the down-
ward pressure on oil prices. The Shah has opposed any
price reductions and has indicated Iran's-willingness
to restrict output to maintain high prices.
Iranian officials, taking note of the possible re-
duction of about $2 billion in oil revenues this year,
have indicated that Iran will consequently have to re-
duce its foreign aid. Even with reduced oil earnings,
Iran would have the ability to continue large loans in
1975. It seems likely therefore that Tehran is using
this excuse to avoid criticism from the developing coun-
tries for its policy to limit aid-related credits in favor
of more remunerative investments. Tehran seems intent on
making the Western oil companies the scapegoats for its
lending actions.
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Two Soviet Politburo members and a candidate member
on Tuesday reiterated Moscow's commitment to detente.
Their speeches add authority to recent Soviet press ar-
ticles on the continuing importance the Soviets attach
to good ties with the US. Party Secretary Ponomarev, De-
fense Minister Grechko, and trade union boss Shelepin
all emphasized the continuity of Soviet foreign policy.
Their remarks were probably meant to reassure for-
eign and domestic audiences about Soviet stability, de-
spite the US-USSR trade setback and General Secretary
Brezhnev's extended absence from public life. The
speeches do not necessarily mean that policy issues are
not under debate among the leaders, however, nor do they
shed much light on Brezhnev's status.
Ponomarev, the candidate member, addressed an armed
forces conference of ideological workers in Moscow and,
said that detente must be irreversible. He emphasized
the importance of Brezhnev's summitry with Western lead-
ers and of the Vladivostok accords to a long-term US-
Soviet arms limitation agreement. In terms reminiscent
of a speech he made to European communists in December,
Ponomarev described detente as offering new opportunities
for socialism.
Grechko, speaking to the same conference, also
praised the Soviet "peace program," but the defense min-
ister characteristically attributed its success to the
USSR's growing military strength. He cautioned that the
danger of war remains a "grim reality" and that the arms
race is accelerating rather than slowing.
Shelepin, meanwhile, was in East Berlin, where he
strongly defended Soviet policy against unnamed critics--
perhaps including his doctrinaire East German hosts--who
argue that capitalists have been the main beneficiaries
of detente. He said that East-West economic cooperation
aids the cause of peace, assists workers in troubled
capitalist economies, and strengthens the Soviet economy.
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Soviet media coverage of the resumption of the Stra-
tegic Arms Limitations Talks has been positive. The
media explicitly stated that progress in Geneva is more
important than ever because of the negative development
in relations caused by the US trade legislation. ~I
LATIN AMERICA
The Venezuelans, elated with their success in rally-
ing Latin American condemnation of the US Trade Reform Act
and with the consequent postponement of the foreign minis-
ters' meeting in Buenos Aires, seem prepared to pursue their
new role as regional leader even further.
There are tentative indications that President Perez
is advancing the timetable for a summit meeting of all
Latin and Caribbean presidents, so that it can be held in
Caracas in March. This would enable the conferees to
establish joint positions on as many of the questions on
the OAS General Assembly agenda as possible before the
Assembly meets in April.
The Latins, in the meantime, seem determined to let
the inter-American "dialogue" remain suspended until they
receive some satisfaction from the US on the trade act.
So far, there are two bills in the US Congress to exempt
Venezuela and Ecuador from provisions in the act aimed
at OPEC members. Although the Latins are obviously,
,pleased with this gesture, they will be waiting to see
if the legislation itself is chap ed.
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Soviet Foreign Minister Gromyko will take a tough
line in Cairo next week in response to President Sadat's
recent criticisms of the USSR.
Y. D. Pyrlin, deputy chief of the Foreign Ministry's
Middle East division, told a US embassy officer in Moscow
on Thursday that Sadat, in his recent Le Monde interview,
had raised "many difficult" matters and had not helped
Soviet-Egyptian relations. A Soviet official in Egypt
has been saying that Gromyko will speak strongly to Sadat
about bilateral matters and the Geneva conference.
The Foreign Ministry official indicated that Gromyko
will sign scientific, consular, and economic agreements
while in Cairo. These accords were negotiated during
the past few months and had been intended for signature
by General Secretary Brezhnev. If Gromyko does the
honors, it will be a further indication that Brezhnev's
trip to the Middle East has been postponed indefinitely.
Pyrlin said that Gromyko will not discuss resched-
uling of Egypt's debts, but that this would be discussed
during routine Soviet-Egyptian economic talks in Moscow
next month. Sadat has grown more critical of Moscow's
failure to postpone payments on past arms purchases as
pressures on Egypt's foreign currency position have in-
creased. Moscow doubtless sees the debt issue--along
with arms supplies--as a lever on the Egyptians.
The Soviet Foreign Ministry official was noncommit-
tal about Secretary Kissinger's projected Middle East
trip. He gave a predictable plug for the Geneva confer-
ence, but implied that going to Geneva does not rule out
other kinds of negotiations.
Pyrlin predicted that Gromyko's visit to Syria,
which begins today, will be routine. The Soviets may,
however, seek to fan Syrian suspicions of Egyptian in-
tentions in the disengagement negotiations and to bolster
Syrian support for talks in Geneva. The Soviet official
in Cairo recently indicated that, after Saudi King Fay-
sal's visit to Syria, Moscow is less sure of President
Asad's commitment to move the negotiations to Genevan
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National Intelligence Bulletin February 1, 1975
ANGOLA
The black-dominated transitional government that
will prepare Angola for independence next November was
formally installed in Luanda yesterday. The government
is based on an uneasy truce among Angola's three rival
nationalist groups that is sure to be subjected to
severe strains in the coming months.
The new Angolan regime is headed by a Portuguese
high commissioner and a presidential council made up
of one member from each of the groups, with the chair-
manship rotated monthly. The high commissioner rep-
resents Portugal's interests but has no vote on
domestic issues. A cabinet of 12 ministers, with
portfolios equally divided among the Portuguese and
the liberation groups, also was installed.
The leaders of the three nationalist groups have
appointed deputies to represent them on the presidential
council, so as to remain free to engage in political
activities. They did not appear in Luanda for the in-
stallation procedure.
Signs of trouble between two of the groups have
already emerged. On January 25, an official of the
National Front for the Liberation of Angola destroyed
some equipment at the government-run radio station in
protest against censorship of Front communiques by
staff members sympathetic to the Popular Movement for
the Liberation of Angola. The next day, Front members
kidnaped the station's deputy director and beat him
badly before he was released. Both the Front and the
Popular Movement subsequently issued communiques ac-
cusing the other of planning civil war.
After a decade of intense rivalry, sometimes marked
by armed clashes, cooperation among the groups will not
come easily, if at all. Indeed, antipathy between the
National Front and the Popular Movement, based on the
personal ambitions and conflicting ideologies of their
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respective leaders, is so strong that open warfare
between them is a distinct possibility. The National
Union for the Total Independence of Angola, the
smallest of the three groups, has emerged thus far
as an effective intermediary. The National Union's
ability to continue in that role, however, is likely
to be weakened by its own political preoccupations
during the transitional period.
Rebels yesterday attacked government forces in
Asmara, the capital of Eritrea Province. The fire-
fight lasted for about an hour. This was the largest
operation mounted by the rebels against the armed
forces in over a year. The rebels are probably trying
to draw the ruling military council into large-scale
hostilities, in which the government's forces could
well suffer some setbacks.
A US naval communications station, located near
an Ethiopian army facility, was caught in the crossfire.
No casualties were reported among the approximately
110 US personnel or among the other 300 Americans in
or near Asmara.
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Small. groups of radical demonstrators last night
marched through downtown Lisbon without serious incident,
but the tensions associated with holding such political
rallies will continue into next week.
The Socialist Party, which canceled its rally last
night in accord with the ban against such demonstrations
by the Armed Forces Movement, has rescheduled it for
February 7. If the Communists should schedule another
anti-Socialist counterdemonstration as they did this
week, the Movement might ban all rallies until after
the election.
The Communists, meanwhile, have made another attempt
to postpone the election set for this spring. They have
demanded that the government publish a list, before next
Monday's deadline for closing voter registration lists,
of those people ineligible to vote because of their
association with the previous regime. Although only a
few thousand people are involved, the Communists assert
that they wish to prevent "fascists" from registering
illegally.
The government quickly obliged and also announced
that it would stick to the electoral calendar, even if
a complete list of ineligibles proved impossible to
compile.
The Communists are expected to continue making
difficult demands upon the government throughout the
electoral procedure. They will be trying to build a
case for later charges of rigging, should they choose
to contest the election results.
Both President Costa Gomes and Prime Minister Gon-
calves have been conspicuously silent in recent weeks,
but Minister Without Portfolio Vitor Alves said Thursday
that Goncalves will soon address the nation and that
Costa Games will shortly announce the date of the elec-
tion. The electoral law requires that the election date
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be announced 60 days in advance. The election will most
likely be held in the first ten days of April, but no
later than April 25.
The Communist-dominated Portuguese Democratic Move-
ment became the fourth party to qualify for the ballot
this week, after it presented signatures of 5,000 sup-
porters to the Supreme Court. The Communists, Popular
Democrats, and center-right Social Democratic Center
have already qualified. The inability of the Socialists
to round up the necessary signatures appears to be a
reflection of their poor organization rather than their
popular support.
France: The cabinet shuffle yesterday--the first
since President Giscard came to office last June--
has been expected for some time and does not portend a
major policy shift. Outgoing defense minister Soufflet,
who has been widely criticized for his lackluster per-
formance, was replaced by another staunch Gaullist, Yvon
Bourges. The secretary of state for posts and telecom-
munications, Pierre Lelong, also was replaced; he has
been condemned for provoking and aggravating last fall's
six-week postal strike. In a move underlining Giscard's
campaign to boost exports, Secretary of State for Foreign
Trade Norbert Segard was promoted to the rank of full
minister. Former EC commissioner Jean-Francois Deniau
was named to the new post of secretary of state for ag-
riculture--possibly a reflection of French concern over
recent arguments with EC colleagues about the common
agricultural policy.
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