CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R000800010044-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 16
• Document Creation Date: December 19, 2016
• Document Release Date: November 26, 2001
• Sequence Number: 44
• Publication Date: October 16, 1971
• Content Type: BULL

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Secret
No Foreign llicrent
DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bullefin
USAID declassification & release instructions on file
Secret
N?. 56i
J.6 October. 1971
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Secret
'fhc CE'jt.I'1'BM, IN'1'1;1,1,1(;1;NC1,; li(11,1,1s'1'IN is 1,'odnecd by the
Director oi' Cettt.ttl lulclligcrrcc t'? meet his respollSihilities for providing
current intelligcrtce hearing on issues oI' national s('cnrity to the I'residcnt,
thu! National Security Council, and other senior govcrutnent officials. It
is produced ill consultation with the I)clmrltucnls of State and I)cfcuse.
When, bccscItse of the tituc factor, adequate cPi)Soltatioll with the c.elru't-
ntcut of' primary concert is not fcasiblc, items or portions thereof' arc pro-
duced by CIA and enclosed in brackets.
In; ~rpretations of intelligence iltformatiou in this pilI,lication represent
immediate vtd prelintioary views which are subject to modification in the
light of hurt"rer infornrationn and more complete analysis.
Certain intelligence items in this publication may ;e (Icsignate(1 specifically
for no further dissemination, Other intelligence items tnay be disseminated
further, but only on a need-to-know basis.
WARNING
This c'octunent contains information affecting the national
defense of the United States, within the meaning of Title
18, secti;;ns 793 and 794, of the US Code, as III] CI IdC().
Its transmission or revelation of its contents to or re-
ceipt by an innwthorized person is prohibited by law.
GROUP 1
Excluded from automatic
downgrading and
declassification
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lio. 0248/71
16 Octobnx? 1971
Central Intelligence Bulletin
NORTH VIETNAM - USSR ?? CHINA: Hanoi remain3 silent
on President Nixon 's trip to Moscow. (Page 1)
25X6
INDIA-PAKISTAN: Indian leaders still pushing for
the return of refugees to East Pakistan. (Page 5)
25X6
INTERNATIONAL OIL: OPEC to seek ten percent more
revenue from oil companies. (Page 7)
WESTERN EUROPE: Summit meeting contemplated to
strengthen ties. (Page 8)
CHILE: Military expresses dissatisfaction with per-
formance of government. (Page 10)
COMMUNIST CHINA - ETHIOPIA: Chinese aid said to
total some $84 million (Page 11)
SOUTH KOREA: Government exercises caution in han-
dling students (Page 11)
USSR-LEBANON: Arms purchase talks in Beirut (Page 12)
GREECE: Athens unhappy over West German contacts
with Greek opposition (Page 12)
ANDEAN GROUP: :,outh American group seeks additional
capital resources (Page 13)
PERU: Lima agrees to compensation for property
seizure (Page 13)
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NORTH VIETNAM - USSR - CHINA: Hanoi has so
far failed to comment on President Nixon' s planned
visit to the Soviet Union, although it probably
recognizes the trip will intensify speculation
abroad that a war settlement may be eventually
reached behind Hanoi's back.
The only Vietnamese Communist response so far
has come from a Viet Cong spokesman in Paris who
attempted to minimize the significance of the
President's trip by claiming that it was an in-
ternal matter between the US and the Soviet Union.
As yet, there is no indication that the Vietnamese
plan to level the kind of criticism at Moscow that
they directed at Peking in the wake of its deci-
sio:i to host,the President. Although Hanoi has
never commented directly on the China trip, its
propaganda for several weeks following the announce-
ment was filled with statements indicating suspicion
of a Chinese sellout.
Visits to North Vietnam by a Chinese politburo
member in late September and subsequently by Soviet
President Podgorny doubtless served to reassure the
Vietnamese somewhat concerning the intentions of
Moscow and. Peking. Both visits produced substantial
economic aid grants for North Vietnam and pledges
of support for Vietnamese proposals on a war settle-
ment.
Hanoi will probably now intensify its effort
to portray these agreements as indications of com-
plete backing from its allies. The North Vietnamese
ambassador in Paris recently claimed the Chinese
visit had produced the largest aid package ever
concluded between Peking and Hanoi, If so, the new
commitment could carry a price tag of at least $225
million, the value of total Chinese military and
economic assistance in the peak year of 1967. The
1970 total was an estimated $180 million.
Although no details are known of Moscow's aid
package, the Soviet allusions to their generosity
following the agreement in Hanoi suggest thy-.:t aid
16 Oct 71 Central intelligence Bulletin
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for 1972 will at least match i'losc'w's commitment
for the present year, some $400 million of economic
and military assistance.
In the past, Soviet and Chinese aid has not
been translated i:,.to substantial political influ-
ence in Hanoi, in part because Sino-Soviet rivalry
left Hanoi free to pursue its own path. If the up-
coming summit meetings, however, should convince
Hanoi that both Moscow and Poking, for their own
interests, were changing their views on the war,
the Vietnamese Communists might be inclined to
alter their own approach to a war settlement. (SE-
CRET NO FOREIGN DISSEM)
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INDIA-PAKISTAN: Indian leaders continue to
ewphasize that they are primarily concerned with
the return of the Pakistani refugees.
Both Prime Minister Gandhi and Foreign Minis-
ter Swaran Singh, in several speeches this week,
asserted that India's main concern is the return
of the over nine million East Pakistani refugees
now ir, India. Commenting on the frequently asked
question of when India would grant formal recogni-
tion to an independent East Pakistani regime, Mrs.
Gandhi stated on 14 October that recognizing Bangla
Desh is "not going to help." The prime minister
had earlier said "what we want- is that th?a refugees
be taken back in safety and dignity."
Indian leaders are also emphasizing that they
are willing to buy any solution to the Pakistani
problem that is acceptable to the elected leaders
of East Pakistan. Last weekend SJ.ngh, speaking at
a Ruling Congress Party conference, said India
would accept a settlement of the East Pakistani
problem "within the framework of Pakistan, or in-
dependence, or regional autonomy." Singh explained,
however, that Islamabad must work out a solution
with East Pakistan's "already elected" r.eprezenta-
tives.
Mrs. Gandhi has been less specific. According
to her, it is for the "Bengali people" or "the peo-
ple of Bangla Desh" to decide their fate. Her for-
mulation does not refer directly to the "already
elected" representatives of East Pakistan. These
are the leaders of the province's popular Awami
League. The party is banned now, but it won a ma-
jority of National Assembly seats in elections
last December. India would probably not accept an
agreement which excluded these leaders. (CONFIDEN-
TIAL)
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SECRET
INTERNATIONAL OIL: The Organization of Petro-
leum Exporting Countries has formulated its demands
on the oil companies for increased revenue to offset
the decline in the value of the dollar.
A meeting of central bankers from the 11 member
states was held ir, Vienna this week, and recommenda-
tions were drawn up to guide OPEC members in their
talks with the oil companies. The first showdown
will take place between the Persian Gulf OPEC mem-
bers and Western oil companies "very soon." The
ministers of finance from t;uwait and Iran will rep-
resent all Gulf members. They will seek a ten-percent
increase in posted prices retroactive to 15 August.
Lengthy negotiations are likely to ensue; a "progress
report" on discussions already is scheduled for the
next OPEC ministerial meeting on 7 December.
The oil companies will probably resist the
demands and prolong the negotiations as long as pos-
s;.ble. Their initial position apparently will be
that any OPEC effort involving price adjustment
would violate the five-year revenue pacts signed
this year. A compromise settlement is, however,
likely.
The other complicated and contentious issue-
-OP"-C's demand for "participation" in Western oil
company operations within member countries--will
probably be put off until the devaluation issue is
settled. (CONFIDENTIAL)
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25X1X
WESTERN EUROPE: West European countries are
contemplating a summit meeting early next year to
give new impetus and direction to the unification
movement.
The summit would be the first since the suc-
cessful Hague conference of the Six at the end of
1969 and the first including both present and pro-
spective Community members.
largement of the EC now almost certain and with the
commercial, political, and military implications
for Europe of the US' new economic policy still un-
clear, many West Europeans feel a strong need for
a basic reassessment of where they are heading.
terest in a hign-ievei review o urope's future
reflects more basic considerations. With the en-
25X1X
25X1X
the general in-
(continued)
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Therc have also been signs that the community
members and applicants are not content with existing
mechanisms . Even the French, who have been reluc-
tant to institutionalize the consultations on for-
eign policy initiated last year, recently indicated
that the current procedures are inadequate. (CONFI-
DENTIAL NO FOREIGN DISSEM)
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CHILE: Many military officers reportedly are
dissatis d with the effects of the Popular Unity
government's political and economic programs.
Some officers who until recently hoped thaw
Allende would improve the lot of most Chileans are
growing skeptical. They are particularly critical
of the latitude given the pro-Moscow Communist Party
and leftist exl.remists. Several ranking officers
reportedly plan to complain directly to Allende.
They will include a request that the military not
be exploited for his government's political pur-
Top government officials, including Allende,
ere concerned over evidence of military dissatis-
faction and will try to blunt it. Pay raises and
reassurances would placate some officers. Others
particularly mistrusted by the government could
be isolated and differences among them exacerbated.
(SECRET NO FOREIGN DISSEM)
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25X1 C
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SJ (JtP,1'
COMMUNIST CHINA - ETHIOPIA: Peking agreed to 25X1C
provide its first economic aid to Ethiopia during
Emnerr)r le Sol-assie's recent visit to China.
The irs p. -
ects to be undertaken will be in agricultural devel-
opment, and the only Chinese technicians initially
scheduled to go to Ethiopia will be for these proj-
ects. Ethiopia established diplomatic relations
with Communist China last year. It has now found
a new source of assistance for much-desired agri-
cultural development and further strengthened its
credentials as a nonaligned nation. It is not
known, however, whether the Emperor was able ;:o in-
duce the Chinese to suspend their assistance to in-
surgents operating in Eritrea. (SECRET NO FOREIGN
DISSEM)
SOUTH KOREA: The governmen't's decisive action
yesterday in authorizing police and army forces to
seize and close Seoul's major universities has none-
theless been tempered by caution to minimize an ad-
verse aftermath. Only a sr ill percentage of the
estimated 500 students arrested are to be held for
trial, and the military presence on the campuses has
already been reduced. Pak, moreover, has not crit-
icized either the opposition New Democratic Party,
which had condemned the current actions, or any par-
ticular student organization. Rather, he has chosen
the safe course of claiming that Pyongyang's hostil-
ity toward the South and its efforts to manipulate
South Korean students caused him to act. Despite
all this, the issues behind the student demonstra-
tions remain unresolved. There could be further
outbursts once the pressures of the moment ease.
(CONFIDENTIAL)
(continued)
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USSR-LEBANON: A Soviet military delegation is
scheduled 'arrive in Lebanon on 21 October. to pur-
sue discussions on Beirut's purchase of Soviet mili-
tary equipment. Beirut announced last summer it
would purchase ground forces equipment from Moscow,
reportedly in order to quiet leftists in the Lebanese
Government and elicit additional aid from Western
suppliers. The Soviets have shown greater interest
in Lebanon since the anti-Communist purge in the Su-
dan. Moscow apparently wants to expand its ties to
Arab states noc affiliated with the Confederation of
Arab Republics, the formation of which probably has
heightened Soviet interest in arms talks with Leba-
non, South Yemen, and Iraq and partially accounts
for Kosygin's visits to Algeria and Morocco. (SECRET
NO FOREIGN DISSEM)
GREECE: The Greek Government has warned the
West German Government that economic ties between
the two countries are dependent on their political
relations. The minister of national economy, at
the signing of an agreement for construction projects
with West German firms, publicly expressed Athens'
displeasure over the C._:rman ambassador's insistence
on meeting with opposition politicians. Athens has
little economic leverage for influencing Bonn's pol-
icy. The West German market, however, is of great
importance to Greece, taking about 20 percent of
Greek exports and supplying a large share of its
emigrants' remittances. (CONFIDENTIAL)
(continued)
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S 1.
ANDEAN GROUP: The Washington visit last week
by officials of t e Andean Development Corporation
marked the conclusion of their worldwide effort to
increase the organization's capital resources. In
discussions with US officials, they pressed mainly
for $10 million from AID to enable the corporation
to make loans to the private sector. This meeting
follows similar exploratory discussions in several
West European and Communist capitals, as well as
in Ottawa and Tokyo. The main objective cr the
corporation, which began operation in June 1970,
is to promote integration among the group's members
through regional investment in industrial and other
projects. Thus far, its capital resources are lim-
ited to the $25 million subscribed by member coun-
tries, but officials hope that foreign credits will
increase the figure to $150 million by 1974. (CON-
FIDENTIAL)
PERU: Lima has signed an agreement with W. R.
Grace and Company providing compensaticn for the
Cartavio and Par.amrnga sugar estates and properties.
These were seized in 1969 by the Velasco government
under its agrarian reform law. The agreement, which
i3 apparently acceptable to the company, followed
extensive negotiations. The final price will depend
on a technical-financial audit to determine the cur-
rent value of the properties. Grace has agreed to
assist the government =n finding financing for its
immediate purchase of majority ownership, but the
company's management team will remain in charge of
the properties until its equity is reduced to about
one third. At t:iat time, company control will shift
to a management contract basis. This settlement
should bolster Peru's improving image with foreign
investors, reflected in recent weeks in important
development contracts in the oil, copper, and fish-
ing industries. (CONFIDENTIAL)
Central Intelligence Bulletin 13
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