WEEKLY REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001000070022-6
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 31
• Document Creation Date: December 27, 2016
• Document Release Date: May 10, 2010
• Sequence Number: 22
• Publication Date: September 20, 1974
• Content Type: REPORT

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Weekly Review
Copy
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;CONTENTS (September20, 1974)
1 Cyprus Talks Inch Forward
3 Turkey: Resignation Aftermath
'f he WEEKLY REVIEW :issued every _Friday morning by the
Offii a of Current Intel,igence,?reports andanalyzesslgnificant
developments of the,week through noon on:Thursday. It
frequently includes material cobrdinatedwithor prvpa:edby
the Office of, Eco,omic:- Research, the Office of Strategic
Research, and the.Llirectorete of Science and?.Technology;
Topics requiring, more. comprehensive treatment and therefore
published separately as. Special ' Reports '.are listed in 'the , ;:,I
contents.
4 UK: The Campaign Opens
5 Italy: Heating Up
6 France: Labor; Nuclear Tests; Subs
Yugoslavia-USSR: Rude Awakening
12 Romania: The Party Program
14 Egypt-USSR: No Concessions
14 Rabin's US Visit
16 Ethiopia: Testing
the Military; Economy
18 Iran-Iraq: Kurds Win a Round
19 India-Pakistan: Successful Talk,
20 Portuguese Africa: A Government Forming
25X1
24 South Vietnam: Political Opposition;
Fighting
26 Panama: Rapping the Communists
26 Violence Mounts in Argentina
27 OPEC: Oil Prices Up Again
28 Law of the Sea: Unresolved
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CYPRUS TALKS !NCH FORWARD
Greek and Turkish Cypriot leaders have
moved from a limited discussion of humanitarian
matters to broader political concerns. Not much
progress was made in their meeting on September
13 on political issue:, however, and negotiations,
particularly on population transfers, are likely to
be protracted.
,..sting Cypriot P, >sident Clerides proposed
that Turkish forces witndraw to what he called
the "southern line,"
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Page 1
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Sep 20, 74
Territory controlled
by Turkish forces
Buffer Zone
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Under Clerides' plan, Greek Cypriot refugees
who h:ve fled to the south could return to this
area, and a "quiet" migration of Turkish Cypriots
in the south to the Turkish-held north also would
be allowed. Clerides said that if the "southern
line" were acceptable, all prisoners between the
ages of 18 and 55 would be released immediately.
He added that an announcement would be made
concerning UN protection of Turks who remain
in Greek Cypriot areas until an agreement is
reached. Clerides also said he had Athens' support
for the proposal.
Clerides' offer w . confirmed by UN reports
given to the US embassy in Nicosia. According to
this account, Turkish Cypriot leader Denktash
was cold to Clerides' proposal. The Turkish
ambassador in Nicosia also objected because it
asked Turkey to pull back with no assurance of
 Prisoner of war exchange in Nicosia
what it would be getting in return. According to
the UN reports, Denktash will bring counter-
proposals to his next meeting with Clerides,
scheduled for September 20.
Denktash thinks all Turkish Cypriots will
opt to go into the north, although the UN is far
from sure of this. He said that certain Greek
Cypriots would be allowed to return to the
Turkish zone as long as they remain in the mi-
nority and'do not constitute a security threat. In
a press conference this week, Turkish leader
Ecevit said the space available for Greek Cypriots
in the north will not be known until all the
Turkish Cypriots who wish to move to the north
have done so.
The resignation this week of Turkish Prime
Minister Ecevit and the ensuing governmental
crisis-which may last several weeks or more-are
bound to have an effect on the Cyprus nego-
tiations. Greek officials believe some of the pres-
sure of the Cyprus crisis will be eased while
Turkey is in the middle of an election campaign,
and they are even more eager than before to hold
their own elections before the end of the year.
Prime Minister Karamanlis has announced that
parliamentary elections will be followed by
municipal elections.
Clerides issued a statement on September 14
confirming that Makarios would address the ON
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Sep 20, 74
General Assembly as president of Cyprus; he also
said that there was a "common :ine" between
himself and Makarios on the handling of the
Cyprus problem. According to the US embassy,
however, Clerides recognizes Makarios' potential
to undermine the present negotiations and
Clerides' own position by grandstanding at the
UN.
Ilichev's Cyprus Mission
Soviet Deputy Foreign Minister Ilichev's
mission to Athens, Nicosia, and Ankara has served
to reassert Russian interest in a settlement, has
kept alive the Soviet proposal for an international
conference, and has enabled Moscow to sound
out Greek, 'Turkish, and Cypriot attitudes tow:nrd
UN General Assembly debate on the question.
The Russian's reception in Ankara was some-
what cool, but he went out of his way to avoid
offending the Turks. He sought renewed Turkish
assurances that Ankara is not opposed to a sov-
ereign and nonaligned Cyprus. In return, he
expressed explicit Soviet approval of a federated 25X1
state. Ilichev also sought to keep bilat?ral re-
lations on the right track, promising that the 25X1
Turkish finance minister's visit to Moscow this
October will be "most fruitful,"
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TURKEY: Resignation Aftermath
The coalition that has governed Turkey for
eight months was dissolved on September 18
when Prime Minisier Ecevit resigned. Ecevit will
remain in office as caretaker until a new govern-
ment can be formed. President Koruturk is ex-
pected to ask Ecevit to try to form a new coali-
tion, a J the Republican People's Party leader
appears to be wooing the relatively small right-of-
center Democratic Party.
Problems within the governing coalition
came to a head when Deputy Prime Minister
Erbakan, leader of the junior coalition partner,
announced that cabinet ministers of his National
Salvation Party would not sign a decree author-
izing Ecevit to travel to Scandinavia as the official
representative of Turkey. This denial came in
retaliation for Ecevit's decision to name a minis-
ter from his own party instead of Erbakan to
head the government in his absence.
Relations between the two coalition parties
may have reached the breaking point sooner than
Ecevit expected, but the coalition was fragile
from the beginning and he was looking for a way
out. Ecevit became something of a national hero
as a result of Turkey's intervention on Cyprus and
hoped to be able to translate his personal popu-
larity into a parliamentary majority, negating the
need for a coalition. He is aware, however, that
his image could fade as economic problems re-
capture public attention and he is, therefore,
pressing for elections before the end of the year.
Ecevit will need a majority vote in parliament to
approve holding elections before those scheduled
for 1977.
Presidc;it Koruturk has begun a round of
talks with leaders of the various political parties,
the first step toward forming a new government.
After completing these talks, the President is
expected to ask Ecevit to try to form a new
government. If Ecevit should fail to arrange an
alliance that would give him a majority in
parliament, Koruturk could ask him to lead a
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Sep 20, 74
minority government or he could turn to another
political leader.
Democratic leader Bozbeyli appears to have
given Ecevit a favorable initial response to the
possibility of joining a coalition. A coalition of
Ecevit's Republican People's Party and Bozbeyli's
Democratic Party would have only a slim
four-vote majority in the National Assembly,
however, and it is not yet clear that Bozbeyli can
deliver all 45 of his party's votes.
The Democratic Party is generally con-
sidered to be more politically mature and respon-
sible than Ecevit's former coalition partner, but a
coalition of the Republican People's Party and
the Democrats would be strictly a marriage of
convenience. The Democrats have strong ideolog-
ical differences with the moderately leftist Ecevit
and in the past have rejected any suggestion that
they might join with him.
reach a political e-ltlenient on Cyprus.
Even if the Democratic Party decides against
joining a coalition, it could give Ecevit a majority
vote in parliament, enabling him to organize a
one-party minority government. Ecevit might also
draw the votes of even the smaller Republican
Reliance Party, which would give him a little
more breathing room. The Republican Reliance,
which controls only 13 seats in the assembly, is
made up of former members of the right wing of
Ecevit's own party.
The political maneuvering and negotiations
necessary to organize a new government could
take as much as three or four weeks; it took three
months following the indecisive elections last
October. If Ecevit is unable to gather enough
support to govern, the Justice Party led by
Suleyman Demirel might be called on by Presi-
dent Koruturk to try to put together a center-
right coalition. This would delay even longer the 25X1
time when Turkey can again turn its full attention
to such problems as inflation and the effort to
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Britain's political parties have launched their
national election campaigns with the publication
of their manifestos. In Wednesday's long-awaited
announcement, Prime Minister Harold Wilson set
the election date for October 10.
Mud-slinging accusations are conspicuously
absent from the Labor, Conservative, and Liberal
manifestos. The campaign tone is somber, in fact,
as all three parties focus on Britain's serious eco-
nomic problems.
Of the three party programs, Labor's is the
most partisan. Titled "Britain Will Win With
Labor," it offers few surprises. Frankly socialist,
it calls for redistribution of national wealth and
expanded state ownership of indu. try, including
greater public control of North SF a oil and gas
reserves. The manifesto comments on the nation's
economic i;ls, but offers no proposals for tackling
inflation beyond the "social contract" concept of
voluntary wage and price control. Labor also
promises a referendum within a year on UK rnem-
bership in the European communities and rules
out participation in a coalition government.
Leaving the coalition question open, the
Tory manifesto pledges consultation with all
other party leaders if a Conservative government
is formed after the elections. It calls for national
unity and makes conciliatory overtures to
Britain's trade unions with promises of increased
pension benefits, government assistance in train-
ing union officers, and greater recognition of
strikers' rights. The Conservative platform in-
corporates some of the economic views of the
shadow home secretary, Sir Keith Joseph, who
has bean applauded in the press for his contro-
versial analysis of errors in the Conservatives' pre-
vious economic policy. The Tory anti-inflation
program includes control of the money supply, as
Joseph urged, as well as restraint in public spend-
ing and in wage and price demands.
The Liberal campaign has begun on a note of
realism. At the party's Brighton convention last
weekend, delegates overwhelmingly defeated a
resolution opposing any coalition with the Con-
servatives or Labor. Party leader Jeremy Thorpe
did move to placate left-wing Liberals, who are
concerned about an alliance with the Conser-
vatives, by stipulating that any coalition would be
for a limited period. The Liberal manifesto, like
its Tory counterpart, avoic: promising easy solu-
tions to inflation. It admits that the government
will need to reinstitute mandatory wage and price
controls, which are unpopular with trade u-,ions.
The Liberals, however, urge the adoption of such
social programs as the redistribution of national
wealth, a review of electoral processes, and in-
troduction of power-sharing in industry before
statutory wage and price controls are applied.
The Conservatives and Labor appear to be
running neck and neck. The Conservatives have
made some gains since last week, nelped by the
reasoned, conciliatory tone of their manifesto,
which was well received in the British press. A
Gallup poll issued last week showed Labor leading
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with almost 41 percent of the vote, compared
with 38 percent for Conservatives; the Liberals
had 18. A new poll published this week show
ITALY: HEATING UP
The new political season will not open for-
mally until parliament reconvenes on September
24, but Italian politicians have been engaged in a
wide--anging public debate since the end of the
traditional August holiday. Prime Minister
Rumor's government is not expected to last long
and the main issue-particularly in view of the
Communist Party's spirited efforts to establish a
"new relationship" with the center-left coali-
tion-is the complexion and modalities of the
next government.
Sharp differences among the coalition part-
ners have been papered over on numerous oc-
casions since Rumor took office in July 1973
with the rationale that the country could not
afford a political crisis and an economic crisis at
the same time. Now that parliament has passed an
austerity program and the government has
secured a $2 billion loan from West Germany,
party leaders may feel that they have enough
breathing space to attempt the political "clarifica-
tion" that has been discussed behind the scenes
for months. They may have concluded, moreover,
that further progress on the economy is not possi-
ble until the coalition partners have ironed out
their differences-or at least made them explicit
through negotiations for a new government.
The Communists are trying to extend their
influence in national policy making, and they cite
their role in the shaping of the austerity program
as evidence that the government is already com-
pelled to give weight to Communist views. In
parliamentary debate over the program, some
Communist-sponsored amendments attracted
enough support from left-of-center elements
within the coalition to secure their passage. The
Page WEEKLY REVIEW
amendments lightened the tax burden on low
income groups at the expense of corporations and
the more affluent.
25X1
The Communists do not appear ppear to be de-
manding actual membership in the next govern-
ment. For the moment, they would be satisfied
with such a limited but still important ^oncession
as formalized consultations on the government's
legislative program. Communist leader Berlinguer
thinks that such a step would go far toward
achieving his goal of gradually "conditioning" the
public to accept F?s party as a legitimate candi-
date for coalition membership.
The coalition parties are divided on the
Communist question. Most Socialists favor some
form of governmental collaboration with the
Communists, while the Social Democrats and Re-
publicans are opposed. The official response of
the dominant Christian Democratic Party is nega-
tive, but some prominent i nembers of the party's
left wing are publicly supporting closer relations
with the Communists.
In his most recent statement on the subject,
Christian Democratic leadE+r Amintore Fanfani
seemed to be setting the stage for a serious debate
on the issue. He noted all of the practical prob-
lems that a deal with the Communists would
create for his party-a loss of votes, soured rela-
tions with the other coalition parties, and more
neo-fascist violence-and remarked that such a
decision could only be made by a national party
congress.
closer relations with the governing parties.
Fanfani also made much of the difficulties
that increased Communist influence would create
for Italy's role in NATO. In a series of carefully
balanced statemen `s, the Communists have hinted
that they could live with NATO, provided Italy
did not broaden its commitment to the alliance.
The Commc-iists realize, however, that their25X1
ambiguity on NATO remains a major obstacle to
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LAE30R MODERATF, FARMERS MILITANT
Recent statements by French labor leaders
have stressed moderation and the des;ribility of
negotiating with government and management.
Their tone contrasts sharply with veiled threats -in
June and July of a reckoning in the fall. Leaders
of the three most important labor organizations,
including the Communist-dominated General
Confederation of Labor, continue to criticize
President Giscard's policies, but their speeches
lack the customary apocalyptic overtones and are
remarkably free of menacing words about trade
union action. Labor's cooperative attitude has not
been matched by the farmers, however, who are
vigorously protesting the level of EC and govern-
ment support for agriculture.
Labor's moderation may be a by-product of
its recognition that France's economic plight is
severe, and that the rank-and-file union member is
not in the mood for militant action. Most work-
ers seem paralyzed by the specter of unemploy-
ment and the bleak prospects facing them if
France's inflation is not controlled. Union bel-
ligerence has also been dampened by the fact
that, for most members, wages have risen faster
than prices.
The closeness of the recent presidential
election also has encouraged the leftists to avoid
rash behavior in the hope of further improving
their political position. Labor and leftist leaders
are correspondingly more sensitive to allegations
that labor could aggravate France's political and
economic problems through industrial action.
They fear that such claims could hurt leftist
candidates in the next legislative election.
Labor's emphasis on negotiations rather than
militancy also derives from a recognition that
Giscard's government has shown sympathy for
many leftist goals. The establishment of a com-
mission to look into industrial relations, for
example, gives the left something to gain from
cultivating the good will of the government.
Furthermore, labor leaders believe that insistence
on negotiation now could pay political dividends
in the future if Giscard seems to follow their
lead-as they anticipate-by calling for talks
between the government and organized labor to
form a common front against inflation.
While organized labor bides its time,
however, the historical process of elimination of
small businessmen a: -.d farmers has been acceler-
ated by inflation and the credit squeeze. During
the first half of 1974, 6,000 small- and medium-
sized businesses cashed in their chips-23 percent
more than in the first half of 1973. Inevitably,
the workers, too, have been affected. Although
the employment level in France as a whole re-
mains fairly high, the business failures are creating
pockets of unemployment and labor discontent.
Thousands of workers-some 4,000 in the past
week alone-have occupied bankrupt factories
this summer in attempts to save their jobs.
Government and labor leaders alike are keeping a
close watch on these tr' uble spots, waiting for
the spark that could set off a national reaction.
Farmers form one of the most volatile
interest groups in France today. Staunch Gaul-
lists, they voted overwhelmingly for Giscard last
May, but are now saying they have had enough of
"liberalism." The farmers have been hard hit by
inflation and, lacking an effective centralized
organization, they have resorted to mass demon-
strations and occasional violence. Their action
forced the government to make a number of
temporary concessions this summer, but the
demonstrations continue. Unless the EC agricul-
tural ministers can reach agreement this month on
a substantial increase in the support price for
agricultural produce, farmer unrest in France
could become a serious problem for Giscard's
government.
On the whole, the labor scene in France this
fall will probably remain quieter than expected. A
serious jump in unemployment, however, or a
decline in other economic indicators could reverse
the moderate mood.
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France's 1974 nuclear test series in the
South Pacific ended on September :4 after seven
low to intermediate-yield detonations, and at
least one safety test. Paris probably views the
series as a success, although it was marked by a
succession of delays caused by bad weather and
technical problems. The concluding shot may also
have been France's last atmospheric nuclear test,
as the government had announced earlier this
summer that future tests would be held under-
ground.
Major goals of the 1974 program included
testing nl clear components for multiple re-entry
vehicles. and the further miniaturization and
improvement of fission "triggering" devices for
thermonuclear weapons. The French may also
have tested a device f.Dr a warhead to be used on a
new stand-off air-to-surface misdr~ system.
25X1
International protest over French testing in
the atmosphere was more subdued this year than
in the past. Although Australia and New Zealand
registered protests after each test, their lower key
complaints apparently were tempered by Paris'
announcement that future tests would be held
underground.
25X1 25X1 25X1
France is expected to begin underground
testing next year at Fagataufa Atoll, which is near
the present test site.
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I I
NUCLEAR SUB FORCE EXPANDING
struct a sixt nuclear-powered ballistic-missile
submarine. One press report claims the decision
was made last April.
Paris has decided to'
con-
France now has three missile submarine.; in
operation: two have been rotating on patrols or
almost two years; the third is expected to sail for
its first patrol around the end of this month. A
fourth was launched on September 17, and work
on the fifth will begin shortly. At the current
pace, all six could be in operation by 1982.
French missile submarines routinely operate
in the Norwegian Sea-the primary patrol zone
for potential operations against Moscow, France's
highest priority target. During the last three years,
the two oldest submarines have completed 16
such patrols. Because of the limited number of
submarines, the French have been forced to spend
long periods on station-more than 50 percent of
each patrol cycle in the Norwegian, S ea. This has
permitted continuous patrolling since late 1971,
but at the cost of greater equipment wear.
France's first missile submarine, Le Redout-
able, recently completed its tenth patrol, and is
scheduled for a 15-month overhaul at new dry-
dock facilities at lie Longue. It probably will be
',:itted with an improved missile that has greater
range and accuracy than the on ~ it now carries.
Lc. Foudroyant, which was turned over to the
navy in June, probably will replace the Le
Redoutable on patrol 'ater this month.
By the late 1970s, the French should be able
to operate missile submarines continuously in two
patrol zones-the Norwegian Sea and the Mediter-
ranean.
25X1
Stationing submarines in the Mediterranean
would place targets in the southwestern USSR-
including such major cities as Kiev, Odessa, and
Baku-within the range of French seaborne mis-
siles. The submarines could also supplement exist-
ing French coverage of the northwestern USSR,
including Moscow and Leningrad.
The French, at some point, are likely to
build facilities capable of handling missile sub-
marines at a Mediterranean port in order to re-
duce transit time between base and patrol area
and to simplify logistic support. Only the Atlantic
coast facility at Ile Longue is now capable of
servicing nuclear ballistic-missile submarines.
25X1
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Soviet-Yugoslav relations, which had steadily
improved after Brezhnev's visit to Belgrade in
September 1971, are now clouded by Belgrade's
allegations that the Soviets have meddled in
Yugoslav political affairs. The trials of the group
of Moscow-oriented plotters-and Tito's promise
that the trial proceedings will be published-will
deepen suspicions of the USSR among both
Yugoslav officials and citizens.
Tito revealed on September 12 that a group
Of "Cominformists" had established an illegal
Communist party at a secret congress in Yueno-
slavia earlier in the summer. He charged that the
group had circulated "vast" quantities of prop-
aganda materials, which had been printed abroad,
and had "even elected its leadership," including a
secretary who is someone "outside our country."
Yugoslav authorities soon began to spread the
word informally that the group's tracks led to
Moscow and Prague.
their lot with Stalin at the time of his break with
Tito in 1948. A subsequent radio commentary
denounced members of this Stalinist group for
treason and criticized those countries that still
harbor Cominformist emigres.
Some Yugoslavs had come to accept Tito's
assurances of a basic change in the Soviet attitude
toward Yugoslavia; even more viewed the im-
proved relations as a distasteful-but necessary-
deal with the devil. All will be shocked by this
latest development.
For the moment, scheduled visits of Soviets
to Yugoslavia appear to be following a proper-if
somewhat cool-course. The activities of Vladimir
Novikov, a Soviet deputy premier, have been
played down by the media, and the chief of the
Soviet General Staff, who arrived or, schedule on
September 17, has so far seen only his Yugoslav
opposite number.
Tito's description of the group as "Comin-
formists" links them to Yugoslavs who threw in
A Yugoslav diplomat in Budapest said this
week that his country was no longer interested in
obtaining Soviet surface-to-air missiles. This is a
reversal of the previous Yugoslav position and
may indicate that an impending arms deal is
imperiled. On the political level, the diplomat
implied that Yugoslavia would probably not
attend any international communist gathering
when he said that the final decision depended on
the results of the trials.
Tito's decision to make public the Comin-
formist affair raises the possibility that other
problems in Soviet-Yugoslav relations may also
surface. For the past several years, differences
between the two countries have been smoothed
over in order to bring about a rapprochement.
Now that the door has been opened, Yugoslav 25X1
complaints could easily multiply and cause
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ROMANIA: THE PARTY PROGRAM
The new Romanian party program throws
down the ideological gauntlet to Moscow, im-
plicitly challenging the Kremlin's authority to be
the sole interpreter of Marxism-Leninism. The
program widens the gap between Moscow and
Bucharest and leaves Romania open to charges of
pursuing a "revisionist" and "national commu-
nist" course.
The cardinal Leninist tenet of a world
divided into capitalist and socialist camps is re-
jected. Instead, the Romanian program contends
it is necessary to recognize that the world is made
up of developed, developing, and undevelop25X1
nations. This formulation runs counter to Soviet
doctrine by taking a non-class approach to politi-
cal groupings and moves Bucharest closer to the
views of Peking and the nonaligned states. It
implicitly lumps the Soviet Union with the de-
veloped capitalist states.
The program also parts ideological company
with the Soviets by:
? Criticizing the Sino-Soviet dispute as
harmful to socialism and pledging the Ro-
manian party to act with all "determination"
to surmount differences between socialist
states;
? Describing the "nation" as an abiding
and enduring force, one of Ceuusescu's fa-
vorite themes that leaves Bucharest vulnerable
to charges of "bourgeois nationalism";
? Asserting that socialist, as well as capi-
talist, societies contain "inner contradic-
tions," a view similar to Chinese formulations.
The program criticizes the socialist move-
ment (read Moscow) for seeing all parties in the
same light without recognizing the special needs
of each party in its development. The document
also asserts that integration can be achieved only
when equal levels of development have been
reached by all socialist countries. Finally, the
program focuses on the humanist purposes of
society, a subject conspicuously avoided else-
where in the Soviet camp since Dubcek's
Czechoslovakia.
The program is to be formally adopted at
the party congress in late November. In the
meantime, nationwide debates and discussions are
to be held to educate the public and to drum up
support for the program.
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SALT: UNCERTAIN PROSPECTS
The Strategic Arms Limitation Talks re-
sumed this week after a six-month recess. The
1972 Interim Agreement on offensive arms ex-
pires in 1977, and the goal is to replace it with a
ten-year pact that would run until 1985.
The new session faces uncertain prospects
for an early resolution of the differences separat-
ing the two sides. Nevertheless, the Soviets, par-
ticularly since the summit in June, have re-
peatedly stressed their interest in the negotia-
tions. In July, General Secretary Brezhnev de-
clared that the Soviets were eager to go beyond
the arms control measures agreed on at the Mos-
cow summit, which included a partial under-
ground test ban, further restrictions on ABM
deployment, and an agreement covering environ-
mental modification for military purposes.
Soviet hints about specific new areas for
negotiation have been notably absent. Proposals
from Moscow, frequent since June, for a de-
nuclearization of the Mediterranean and a com-
prehensive nuclear test barn have been advanced
primarily for their propaganda value.
The change of administrations in Washington
is probably viewed with mixed feelings by senior
planners in Moscow, who are uncertain about
where President Ford stands cn the specific prob-
lems of arms limitation. They have emphasized
how important the personal relationship between
Brezhnev and former president Nixon was to the
arms talks. Although Moscow began a concerted
public campaign to de-couple detente-and, by
implication, arms control-irom "accidental"
factors in the waning months of former president
Nixon's administration, the Kremlim still es-
pouses leader-to-leader diplomacy.
A debate has evidently been under way in
Moscow for some months over the present and
future role of nuclear arms. Spokesmen for one
side-centered in, but not confined to, the Soviet
defense establishment-argue that Soviet foreign
policy successes, including detente, are in-
extricably linked to a position of strength. The
military newspaper, Red Star declared in August
that the stronger the Soviet armed forces become,
the shorter will be the road to lasting peace.
DIA disagrees with the view expressed in
this article that the Soviets are polarized into
two separate camps-essentially those calling
for more weapons and those satisfied with the
current balance. DIA finds Soviet military re-
action to the Strategic Arms Limitation Talks
and detente in general to be quite favorable.
DIA finds no military spokesmen criticizing
detente or voicing worries about the wisdom
of Strategic Arms Limitation Agreements; on
the contrary, the military press extois both.
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The arguments for the opposing side-that
the nuclear arms race carries great risks for the
Soviet Union-are usually advanced by members
of the USA Institute, but they have also been
endorsed publicly by Brezhnev. During a speech
in July, Brezhnev denied the validity of the thesis,
"If you want peace, be ready for war," by saying,
"If you want peace, conduct a policy of peace
and fight for that policy."
The debate continues, indicating that both
factions are strong, but not strong enough to
force a decision. Meanwhile, the USSR is pro-
gressing rapidly toward the deployment of major
new strategic weapons systems, a deployment
that is permitted under the 1972 Interim Agree-
ment. Of chief concern to the US are four new
Soviet ICBMs, three of which have been tested
with MIRVs and are in the late phases of their
flight-test programs.
The USSR accuses the US of concentrating
its demands on areas of greatest Soviet strength.
The Soviets have consistently attempted to
broaden the negotiations to include systems other
than ICBMs, SLBMs, and heavy bombers. The
Soviets especially want to include the so-called
forward-based systems of the US. This issue will
probably again be raised by the Soviets, as it has
been consistently at past sessions. The Soviets
argue that they =oust have larger strategic forces
tri?n the US because they face nuclear threats
from "third countries"-the UK, France, and
China. Moscow recognizes, however, that asym-
rnetrv in the strategic forces of the two super
powers means that the search for "equal securit "
is likely to proceed slow)
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EGYPT-USSR: NO CONCESSIONS
Moscow and Cairo are continuing to keep
alive the prospect of better relations, but neither
appears willing to make the concessions necessary
for any significant improvement.
Last week, Soviet President Podgorny met
with Egyptian First Deputy Premier Hijazi in Bul-
garia to discuss the possibility of a Brezhnev-
Sadat summit. Although the meeting was cordial,
the only agreement reported was that Foreign
Minister Fahmi should take up the question when
he visits Moscow next month.
Podgorny reportedly said that Moscow
wants to begin a new chapter in Soviet-Egyptian
relations, but the Soviets continue their attempts
to influence Sadat by withholding-as they have
since last spring-significant supplies of new weap-
ons. There have been no new deliveries of military
equipment since two ships arrived last month
carrying ammunition and spare parts, primarily
for the Egyptian air force. Press reports that the
Soviets recently delivered some 50 MIG-23 air-
craft to Egypt are false.
As a result of the cutoff, President Sadat
undoubtedly is feeling some heat from the Egyp-
tian military. In an apparent gesture to Moscow,
Sadat openly acknowledged this week that Egyp-
tian attempts to obtain other sources of arms
notwithstanding, there is no practical alternative
to the USSR in the near future.
This will please Moscow, but the Soviets
want more than Sadat's recogni' ion that Egypt
continues to need the USSR. They want Sadat to
give the Soviets a m,.,.?e substantial role in Middle
East peace diplomacy and to limit his dialogue
with the US. They also want him to abandon
efforts to undercut Soviet influence elsewhere in
the region-such as in South Yemen and Somalia.
And finally, they want Sadat to reverse his swing
away from socialist development of the Egyptian
economy.
The Soviets apparently hope that by later
this year their pressure tactics, combined with
Egyptian disillusionment with the US, will force
Sadat to be more amenable. In the meantime, the
Soviets are continuing to hold out the prospect of
significant new military aid. The Soviets will be
looking to the visit of Fahmi and Chief of Staff
Gamasy next month to determine if movement in
Egyptian policy warrants the Iona-talked-nf
Sadat-Brezhnev summit.
RABIN'S US VISIT
Pr;me Minister Rabin's five-day official visit
last week appears to have resulted in some easing
of apprehension in Israel over the future of
Israeli-US relations.
Senior Israeli officials, liberals and conser-
vatives alike, tcld US embassy officers in Tel Aviv
that the reception accorded Rabin in Washington
had a favorable impact in Israel. The officials
expressed particular satisfaction with the spirit in
which talks about next steps in the peace negotic-
tions were conducted. Behind these favorable
remarks probably lay a considerable feeling of
relief that the US had not forced its views on
Rabin.
Rabin himself told reporters, on his return,
that he was satisfied with the military-aid package
promised by Washington, although he hinted that
he had been unable to extract the multi-year
commitment from the US that the Israelis were
after. He commented that it will require a con-
stant struggle on Israel's part to achieve all its
goals on this score.
Israeli media emphasized the red carpet
treatment given the Prime Minister, the cordial
atmosphere of the talks, and the personal rapport
between Rabin and President Ford. In their initial
assessments of the trip's results, most press
commentators have reflected satisfaction over the
US response to Rabin's request for increased US
military aid, at least as far aF Israel's short-term
needs are concerned. On the c,ther subject of vital
interest to all Israelis, prospects for further
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I I
negotiations with the Arabs, the commentators
concluded that Washington's views are not en-
tirely in line with Israel's. Some have stated that
complete agreement and cooperation between the
US and Israel is impossible because of US efforts
to strengthen its ties with the Arabs.
Rabin stressed in a radio interview on his
return that the next stage of the peace talks must
include political concessions by the Arabs. He
gave no indication as to whether Egypt or Jordan
would be Israel's initial negotiating partner when
talks resume. Although earlier he had reportedly
said that his discussions in Washington had
strengthened his persona; conviction that talks
with Egypt should come first, he said in the radio
interview that this is not an absolute condition.
Moreover, Rabin reiterated his stand that a solu-
tion to the Palestinian problem must be sought in
negotiations with Jordan. He strongly criticized
the Palestine Liberation Organization'- pre-
tensions to represent the Palestinians L.id said
Israel must do all it can to thwart the PLO's
efforts to gain international acceptance of its
claim.
Meanwhile, Rabin's attempts to broaden his
narrow coalitic-,, received a boost this week when
the ruling boay f the Naticnal Religious Party
voted to rejoin the cabinet. The leadership of
Rabin's Labor Party had previously approved a
compromise formula for getting the Religious
Party, which controls ten Knesset seats, back into
the cabinet. Rabin is now seeking to obtain the
consent of his three smaller liberal coalition part-
ners. One of them, the Citizens Rights Party,
which holds three Knesset seats, has threatened to
leave the coalition if the Religious Party returns,
but Rabin may be able to persuade the other two
t, go along with him. If so, he would expand his
present one-vote Knesset majority by seven. The
Religious Party's participation in the cabinet is
likely to make it more difficult for the govern-
ment to arrive at a flexible negotiating position
on the West Bank with its numerous Jewish
religious sites and intimate association with
historical Israel.
The Arab response to Rabin's visit to Wash-
ington has thus far been reserved. Arab media
treatment of the visit and of the m:;itary aid
requests Rabin brought with him was more ex-
tensive before the Israeli leader arrived. Since his
departure, such criticism as there has been from
Arab capitals has focused on Israel rather than on
the US, suggesting that the Arabs intend to re-
serve judgment on the US-Israeli military rela-
tionship and its possible effects on peace negotia-
tions until they are more sure of the degree of
satisfaction that Rabin achieved.
The Egyptian media's treatment of the visit
was typical among Arab countries. Before the
visit, commentators saw in it an attempt by Israel
to obstruct negotiations by seeking US support
for Tel Aviv's military, political, and "moral"
rearmament. Despite an implied presumption that
a new US-Israeli arms agreement would be con-
cluded, Cairo's editorialists expressed confidence
that Washington would neither underwrite a mili-
tary imbalance in Israel's favor nor support an
intransigent negotiating position.
Since the visit, commentary has been sparse.
Editorialists have again taken the position that
Israel is seeking military aid for aggressive pur-
poses, but they have studiously avoided comment
on whether agreements concluded in Washington
in fact meet the alleged Israeli goal. Although the
commentators note that Rabin did obtain an
agreement for continued US military assistance
and that this could raise tensions in the area, they
shrug off the US role in this as expected-and,
thus far, not unacceptable-in view of continuing
US ties with Israel. The change in Washington's
poiicy toward the Arabs, one newspaper com-
mented in an adaptation of a standard Egyptian
line, was never expected to bring tangible changes
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Ethiopia's military leaders apparently en-
countered little or no public opposition to their
removal of former emperor Haile Selassie last
week. The move had been preceded by a harsh
propaganda campaign against Haile Selassie and
the nobility. Many people in the country's urban
centers welcomed the emperor's downfall, while
the countryside, once Haile Selassie's stronghold,
remained quiet. The military rulers are n)w being
confronted with demands for immediate civilian
participation in the government from their former
civilian allies-students, teachers. ind organized
labor. The military has thus fa- -cted with re-
Ethiopian military guard the palace gates
straint, but it can be expected to get tough with
students and labor if they continue to cause
problems.
Following the deposition of the emperor on
September 12, the Armed Forces Coordinating
Committee proclaimed a provisional military
administration to serve until an elected consti-
tutional government takes over at an unspecified
time in the future. Effective power continues to
be wielded by the still largely anonymous com-
mittee-consisting of officers and enlisted per-
sonnel from all the military and public security
services-which is unlikely to relinquish any
authority to civilians.
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Last February, student demonstrations
helped set in motion the events that culminated
in the collapse of the old regime. Until now, the
approximately 5,000 university students and a
much larger number of secondary students in the
capital have sided with the military, which has
stirred them up by its propaganda attacks against
Haile Selassie and the Ethiopian establishment.
Early this week, however, ;econdary stu-
dents staged a sit-down demonstration near the
campus demanding an immediate end to military
rule. Soldiers and police broke up the crowd
without violence, but several thousand students
later defied the military's ban on gatherings by
congregating on the university campus to hear
speakers harshly condemn the military as "scoun-
drels" who were unrepresentative of the Ethio-
pian people. Military committee spokesmen ap-
peared briefly and addressed the students in a
conciliatory fashion. The military decided to
permit the students to let off steam, but troops
and police ringed the campus to keep the students
from marching downtown.
The students were reported earlier to have
demanded membership on the dominant military
committee as well as the abandonment of the
committee's plan to send a large number of uni-
versity students to rural areas for two years to
carry out literacy and development programs and
to indoctrinate the population on the military's
goals. The 18,000-member teachers association
was also reported to have urged expansion of the
military committee to include civilians and has
expressed doubts about the program to send the
students to the countryside.
Early this week, the Confederation of Ethio-
pian Labor Unions adopted a resolution support-
ing most of the military's programs, but deploring
what it considers the Ethiopian people's loss of
rights under the new provisional military govern-
ment. The resolution urged the establishment of a
civilian "people's government," and made veiled
reference to a general strike should the military
attempt to move against the confederation. The
confederation claims 140,000 members nation-
wide, but int'rnal divisions and widespread un-
employment would probably make it hesitant to
carry out the threat of a general strike.
The military would prefer to avoid making
martyrs of either the students or trade unionists.
Some enlisted army personnel and probably a
large part of the air force are believed to share the
outlock of the students and labor militants. There
are no indications at this time, ho,v-ver, that
military and police personnei would refuse to
obey orders to crack down on demonstrations or
strikes.
The military rulers will be in a fairly com-
fortable financial position, but they will have
trouble delivering on promises made over the past
several months to modernize Ethiopia's economy
and to ease urban inflation and unemployment.
The new government has inherited an econ-
omy adversely affected by ycwrs of drought and
months of political uncertainty. They have to
contend with living standards that are among the
lowest in the world. Semi-feudal traditions con-
tinue to defy proqress toward economic moderni-
zation. The church and the nobility still oppose
changing a primitive system of land tenure and
sharecropping methods.
Nevertheless, the country has accumulated
foreign assets sufficient to cover about 14 months
of imports. Export earnings have been better than
usual because of high prices for coffee and a
greater volume of other agricut` Al exports,
while imports have been depressed by an austerity
prograrn and political uncertainty. Government
finances are also healthy because of increased
efforts by the military to collect taxes.
Even so, th" military is under great pressure
from students ar.. labor groups to improve living
standards rapidly, and they must find a way to
continue paying for concessions already given to
armed forces and police personnel. They have
already moved to control prices of food, petro-
leum, and other goods, probably in light of the
fact that Lruan demonstrations over living condi-
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IRAQ-IRAN: KURDS WIN A ROUND
The Iraqi drive against the Kurds that began
in mid-August suffered a serious setback last
weekend when the rebel forces repulsed an attack
on their mountain positions northeast of
Rawanduz. During a ten-hour battle, a reported
300 Iraqis were killed-including a brigide com-
mander-and a large quantity of military equip-
ment was lost. Baghdad's aim in this la+est phase
of its offensive was to drive the Kurds from two
strategic heights overlooking the road from Ra-
wanduz and to separate Kurdish forces in the
north from their supply points along the Iranian
border.
The Kurdish leadership considers the victory
at Rawanduz one of the most significant battles
since hostilities were renewed in March. The suc-
cess has boosted the morale of the Kurdish forces
and reportedly has made the Iraqis realize that
their offensive is not achieving its objectives. As
winter approaches, the Iraqis may commit addi-
tional forces to the action in an effort to end the
conflict quickly. Once the winter weather sets in,
however, large-scale offensive operations wil
become impossible
Kurdish troops training
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INDIA-PAKISTAN: SUCCESSFUL TALKS
India and Pakistan have successfully com-
pleted another round in the normalization process
that began with the Gandhi-Bhutto meeting at
Simla, India, two years ago. The prospects seem
reasonably good for further gradual progress,
despite the persistence of strong mutual suspi-
cions.
istani proposal because it would not include
China and because its provisions for international
supervision would run counter to India's policy of
opposing foreign inspection of its nuclear facil-
ities, other than those already covered by existirg
agreernerts.
After three days of negotiations in Islama-
bad, agreements were signed on September 14
restoring postal, travel, and telecommunications
facilities that had been suspended since the 1971
war.
(they agreed to
hold subsequent talks to explore possibilities for
the establishm?nt of scientific, cultural, and trade
links, and for thrr resumption of air travel and
overflight rights.
No dates were set for these further discus-
sions, nor was dily mention made of restoring
diplomatic relations, also broken in 1971. Pak-
istan is now ready to resume diplomatic ties, but
India wants this step to await further progress on
other issues.
The agreements demonstrate that both coun-
tries remain willing to continue negotiating
despite deeply ingrained suspicions of one an-
other and differences on a variety of issues. For
instance, Pakistan continues to be critical of
India's nuclear detonation of last May. In fact, it
was the Indian nuclear test that led Pakistan to
delay the recent round of talks, originally sched-
uled for June.
India, for its part, has been unsympathetic
to Pakistan's recent proposal at the UN for a
South Asian zone free of nuclear weapons. New
Delhi recognizes that the Pakistani proposal was
intended primarily as a rebuke for India's nuclear
program. The Indians also are wary of the Pak-
Islamabad is also unhappy over New Delhi's
current efforts to reach a political accommoda-
tion with the leaders of Indian-held Kashmir.
India appears willing to give the state more
autonomy in return for greater cooperation on
the part of Kashmir's most influential political
leader, Sheikh Abdullah. Bhutto is obliged b~
political pressures to criticize any step that sug-
gests Kashmir's status as an Indian state is irre-
versible.
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Moreover, Pakistan suspects India of en-
couraging the Afghans to maintain tensions along
the Pakistani-Afghan border. In recent months,
New Delhi has provided Kabul technical assist-
ance and has promised military training. It report-
edly has also given some assurances of support
should Pakistan attack Afghanistan. At the same
time, New Delhi is concerned that trouble could
erupt along the Afghan border with unpredictable
consequences, and it has therefore advised the
Afghans to be careful.
Finally, the Pakistanis were strongly critical
when India tightened its control over Sikkim
earlier this month, although the Indian move
apparently was consistent vvith the wishes of the
Sikkimese legislature. Bhutto publicly condemned
the Indian action as "the latest demonstration of
Indian psychosis-a craze to dominate, to spread
their wings."
These sources of tension could slow the pace
of progress in future negotiations, but they are
unlikely to halt the "Simla nrocess" al-
together.
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the Front group arrived. Local authorities are
anxious to avoid any repetition of the violence
that spread through the city last week following
white and black protests against the dominant
position conceded to the Front in the transitional
government. Lisbon's high commissioner, who
will govern jointly with a Front prime minister
during the interim regime, announced on Septem-
ber 13 that "the 20 or so agitators" responsib'e
for the recent "subversion" will be "severely
punished."
Portuguese Africa
A GOVERNMENT FORMING
Once officially installed, the transitional gov-
ernment will have to deal with Mozambique's
serious economic problems. The government will
be subject to heavy pressures fr,m Mozambique's
blacks to overcome widespread black uneriploy-
ment, and from all elements of the socie,,, to
clamp down on steadily rising prices. The Front's
leaders are unacquainted with Mozambique's
complex and white-dominated economy, and
they will need the expertise and cooperation of
Lisbon and the Portuguese seti!ers in order to
cope with it. Front leaders have declared that
they will not tolerate any labor unrest and have
assured the business community that they will
not challenge Mozambique's lucrative economic
links with South Africa.
Mozambique's transitional government,
which will guide the territory toward independ-
ence next June, is in the process of being formed.
Although the government will be dominated by
members of the former black insurgent move-
ment, the Front for the Liberation of Mozam-
bique, it will be heavily dependent upon Portu-
guese technical expertise.
A 72-member delegation from the Front
arrived in Lourenco Marques this week from the
Front's headquarters in Dar es Salaam. The dele-
gation was led by Joaquim Chissano, the Front's
defense minister and third-ranking officer. Also in
the group were the deputy information minister
and Janet Mondlare, the LIS-born widow of the
Front's founder. Front President Samora Machel
and Vice President dos Santos remained in Tan-
zania. Their absence raised speculation among
political and diplomatic observers that the Front
would name Chissano prime minister.
Portuguese forces and troops of the Front,
who arrived in Lourenco Marques last weekend,
have maintained tight security in the capital since
Similar progress on decolonization in Angola
is still held up by the inability of that territory's
three rival insurgent groups to agree on a common
strategy for negotiating with Lisbon. Breaking the
impasse was probably the main topic of con-
versation in a meeting last weekend in the Cape
Verde Islands between President Spinola and
Zairian President Mobutu, the principal patron of
one of the Angolan rebel groups.
I n an attempt to show some forward
motion, Lisbon is preparing a new iaw granting
the territory internal self-government. For the
time being at least, Angola will be governed by a
"provisional" government that was sworn in on
September 14. The government, composed of
whites and mestizos, will function under the
Guidance of the territory's military junta.
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JAPAN - SOUTH KOREA: DISPUTE SETTLED
South Korea and Japan this week patched
up the sharpest and most prolonged diplomatic
dispute the two countries have experienced since
establishing relations in the mid-1960s.
The immediate crisis, which last week
seemed on the verge of disrupting relations, was
settled when a high-level Japanese envoy brought
President Pak Chong-hui both a personal letter
from Prime Minister Tanaka and assurances-
negotiated in advance-that Tokyo accepted a
degree of responsibility for the assassination in
Seoul last month. The envoy also promised that
Tokyo would take action to curb anti-Pak Korean
activists in Japan; a compromise was struck on
language referring to Chosen Soren, the pro-
Pyongyang group in Korea that Seoul wanted
exp..,:itly condemned. Both Seoul and Tokyo
have acknowledged publicly that US mediation
played an important role in bringing about a
settlem ent.
President Pak this week provided the US
ambassador in Seoul with some additional insight
into Korean objectives in the recent dispute.
Emphasizing his deep concern over what he de-
scribed as a leftward trend in Japan over the past
two or three years, Pak pointed out the potential
danger to South Korea if this continued and
Tokyo adopted neutralist or pro-communist
policies. Pak's remarks somewhat reinforce the
view that Seoul's heavy-handed anti-Japanese
campaign o1 recent weeks cannot be explained
fully by Kor~:an emotional and domestic factors,
but that it wa: also a deliberate attempt by Pak to
check a policy drift in Tok',n, inc!urding moves
toward Pyongyang, at least until Seoul can shore
up its own international standing.
A question being pondered now in both
Seoul and Tokyo is what impact the dispute will
have on future relations between the two coun-
tries. The fact that Tokyo has gone far to accom-
modate Pak's demands has probably encouraged
him to believe in the effectiveness of tough tactics
in dealing with the Japanese. In his talk with the
US ambassador, Pak gave the impression that he
took satisfaction from the fates` turn of events.
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in Tokyo, there is no doubt that the recent
controversy, at least over the near :grm, has
resulted in greater Japanese sensitivity to South
Korean interests.
The Japanese
say that any rapprochement with North Korea
will have to be very gradual and can only take
place during a period of good Seoul-Tokyo
relations.
Still, over the long term, there is little room
for optimism that the patl, of Seoul-Tokyo rela-
tions will be smooth. Korean-Japanese animosities
are deeply rooted, and there is likely to be linger-
ing resentment in Tokyo for some time over re-
cent Korean pressure tactics and the events of the
past year. Tokyo is unlikely to be willing to give
to Seoul the kind of blanket commitment that
the South Koreans feel they need while still fac-
ing a hostile North Korea.
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CAMBODIA: BITING THE BULLET
Just before leaving Phnom Penh to attend
opening ceremonies at the UN General Assembly
this week, Cambodian Prime Minister Long Boret
announced a sweepi-,g economic reform package
aimed at putting domestic prices for key goods
more in line with world prices. The announce-
ment of the package was prompted by continuing
rampant inflation and by the prospect of a sub-
stantial cut in US economic aid. The reform meas-
ures provide for greatly increased prices for both
domestic and imported rice, for similar steep
increases in the price of petroleum products, and
for a major devaluation of the riel. Implementa-
tion of the unpopular reform measures involves
some political risk, but the government is granting
moderate salary increases to civilian employees
and military personnel to partially offset the
impact on living standards.
The Military Scene
Government efforts to gain some fa~,orable
publicity on the eve of the UN battle fizzled as
the major Cambodian army operation southeast
of Phnom Penh has now bogged down com-
pletely. Army units made some initial gains in the
operation-which began on August 22-and suc-
ceeded in pushing the Khmer Communists out of
rocket range of the capital. Flooding, caution on
the part of army commanders, and the need to
withdraw some units for rest have cost the
government the initiative, however, and have al-
lowed the insurgents to move into strong defen-
sive positions. Battle lines in the area are now
drawn along high ground.
Fighting continues to seesaw in other parts
of the country. Army troops have mounted suc-
cessful clearing operations in the northwest,
where over 20,000 civilians have crossed over to
government territory since early last month. The
Communists, for their part, are keeping steady
pressure on government units along Route 4 in
the southwest and have used artillery to shell the
northern provincial capital of Kompong Cham for
the first time in nearly a year
Political Opposition Rises...
During the pest several days, political dissi-
dents of varying stripes have stepped up their
opposition to the Thieu government. A Catholic
splinter group organized dem.instrations in Hue
to denounce government lethargy in coming to
grips with corruption. A Buddhist group led by
Senator Vu Van Mau is forming what could be a
new parry organization that will be mildly anti-
government. Opposition legislators and newspaper
publishers have been pressing the government to
relax restrictions on the press and to lower re-
quirements on forming political partics.
While these actions represent a departure
from the inactivity that has characterized opposi-
tion forces in recent years, they do not pose any
immediate threat to the stability of the Thieu
government. Indeed. Saigon so far has treated the
disturbances calmly, and police and security of-
ficials have been ordered to take a tolerant atti-
tude toward the protesters. Although President
Thieu no doubt will be careful to keep the protest
movements from gathering too much steam, he
appears satisfied that, for the time being at least,
some opposition is good for appearances, es-
pecially while the US is deliberating the amount
of aid it will send his government. Moreover, the
common theme of anti-corruption adopted by
these groups could be used by Thieu as a pretext
for dismissing some of his more incompetent
officials to demonstrate his willingness to clean
up the government.
...While the Fighting Lessens
Although the level of fighting declined
throughout much of the country this week, the
Communists recently have been having considera-
ble success using their firepower to keep govern-
ment forces from retaking lost territory.
In the southern part of Military Region 1,
North Vietnamese shelling attacks have slowed
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the South Vietnamese drive toward Thuong Duc
district town and other positions in Quang Nam
Province that were lost in late July and early
August. In Thua Thien Province, Communist
shellings have forced government troops out of a
number of small outposts several miles west and
south of Hue. After destroying a key bridge on
Route 1 southeast of Hue on September 11, the
Communists used mortars and rockets to harass
South Vietnamese engineers repairing the road
and to delay its reopenina until the next day. The
road is a vital supply route for Hue.
In Military Region 3, Communist gunners
have used mortars with telling effect against
government forces attempting to retake two
positions just west of Route 13 in Binh Duong
Province that were lost in June. Despite President
Thieu's orders to retake the bases, the South
Vietnamese are no longer optimistic over their
prospects for doing so.
The Communists have been using mostly
mortars, rockets, and small-caliber artillery in
recent weeks, although North Vietnamese artil-
lery units possess large numbers of heavy field
guns. They are estimated to have enough am-
munition to sustain large-scale offensive action,
comparable to that of 1972, two
years. 25X1
The government's inability to advance in
these areas is not due to a lack of artillery fire-
power. Despite recent orders from Saigon to
conserve fuel and ammunition, the South
Vietnamese have been firing approximately the
same number of shells as earlier in the summer.
But government troops may have adopted more
cautious tactics as a result of the supply con-
straints.
A more significant development, however,
concerns the performance of South Vietnamese
units. In the recent fighting southwest of Hue,
two regiments of the government's 1st Infantry
Division-which was thought to be one of its best
fighting units-apparently abandoned their
positions after offering only token resistance. The
regional commander has realigned his forces in
this sector, and he may replace several leaders-
including the division commander. Government
forces in Military Region 3 also have been criti-
cized for a lack of aggressiveness.
SOUTH
VIETNAM
-..Hue
:Hn mrN,
\ -' r Da Nang
ucng Duc ~' ~~ R 1
OLIn Nf.~!IAM f
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SO MILES
~5bb39 9 74
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Ce traI
Highlands
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PANAMA: RAPPING THE COMMUNISTS VIOLENCE MOUNTS IN ARGENTINA
The Torrijos government is cracking down
on Communists because of their role in promot-
ing student actions not approved by the adminis-
tration. The authorities have been told not to
permit the secretary general of the Moscow-line
Peoples Party to return to Panama from his
travels, and his brother, who is also a party func-
tionary, has been exiled to Peru. In response, the
party hierarchy has expelled a large number of
pro-government young militants and has ordered
affiliates in secondary schools and the University
of Panama to go underground.
The current rift between the govei,
and the Communists appears to have t .1
sparked by the party's involvement with a small
anti-government student group. These radical stu-
dents apparently were responsible for the violence
that erupted during what was supposed to have
been a peaceful demonstration at the US embassy
in August, and for the hostile reception given
Torrijos when he appeared at the convention of
the Panamanian Students' Federation early this
month. They also probably crganized the un-
authorized demonstration at the Chilean embassy
last week marking the fall of the Allende regime.
Torrijos places much of the blame for the
students' unruliness on the Communists, and he
has told them to stay away from the youth. Since
coming to power in 1968, Torrijos has generally
been tolerant of the Communists and has oc-
casionally used both them and the students to
organize demonstrations of public support for his
government.
In addition, the Peoples Party is the only
political organization he has allowed to continue
functioning, and approximately 200 of its mem-
bers and sympathizers now have jobs with the
government. On the other hand, he frequently
does not consult the party leaders on government
policy, even when it appears to concern them.
For example, they were very displeased by his
failure to consult them before re-establishing
diplomatic relations with Cuba. Nevertheless, the
Communists' desire to preserve whatever measure
of influence they now have with Torrijos is likely
to lead them to try to heal the nrecanf rift.
President Maria Estela de Peron has closed
the University of Buenos Aires, a major center of
leftist agitation, and is attempting to formL'late
other measures to cope with the terrorist violence
and labor disputes that have engulfed Argentina
during the past week.
A new university administrator, appointed
by Mrs. Peron, has declared a week's holiday for
faculty and students, but the government has
indicated that it is prepared to extend the closure
for the remainder of the school year, if necessary.
For the past month, leftist youth, including a
number of Peronists, have occupied university
buildings in protest against the appointment of
Oscar Ivanissevich, an old-guard Peronist, as
education minister. Several hundred demonstra-
tors have been arrested in recent weeks, but it was
not until the homes of both the rector and a
department chairman were fire-bombed, pre-
sumably by right-wing groups, that the govern-
ment decided it must intervene directly. The
move probably will precipitate even more
violence on the part of radical youth, especially
the Montoneros, who have used the university as
their chief stronghold.
Since the Montoneros broke with the
government two weeks ago, bombings and assas-
sinations have taken a quantum jr-mp. So far, the
wave of violence has included over a hundred
bombings and nearly a dozen assassinations. The
death of the most prominent victim, Atilio
Lopez, a union leader and former vice governor of
Cordoba Province, has touched off a new wave of
strikes.
Earlier this week, representatives of Peronist
workers met with a number of leftist and Marxist
union leaders in the provincial city of TucL!man
and announced the formation of a rival organiza-
tion to the orthodox Peronist labor confedera-
tion. Although the new grouping does not yet
include national-level unions, it does create an
important nucleus of anti-government sentiment
that could cause serious nrnhlemc fnr Hors. Feron.
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 Million US $
900-1,130
775-970
335-420
450-560
410-510
290-360
The OPEC ministers agreed on little else at
Vienna. Some of the more contentious issues,
such as managing production cuts and schemes to
establish a single price for oil, were referred to
working groups in preparation for the OPEC
meeting in December. The issue of apportioning
production cutbacks was particularly touchy.
Iran's representative, for example, was opposed to
any scheme that could require his country to cut
production.
Saudi oil minister Yamani was odd man out
in Vienna, just as he was at Quito in July. He
refused to go along with the other members' plans
to increase oil revenues by raising company taxes.
Instead, he indicated that the Saudis would in-
crease their revenues by raising the buy-back price
of government-owned oil to nearly 95 percent of
posted price-the buy-back price for most of the
Gulf countries being 93 percent. If the Saudis
stick to this formula, they will he receiving at
least 20 cents per barrel less than other OPEC
members.
Yamani probably was posturing, publicly
choosing a smaller price increase while knowing
that the Saudis would later insist that Aramco
pay Saudi Arabia at least as much per barrel as
other Gulf producers are getting. Aramco will
doubtless price their oil with this in mind. In any
case, the Saudis apparently plan to take 100-per-
cent control of the company next month and to
introduce a new pricing system.
Despite a production cutback of 300,000
barrels per day in Abu Dhabi, the world oil sur-
plus still exceeds a million barrels a day. At the
OPEC conference, a number of countries re-
portedly announced decisions to cut production,
but no details are available. If the initiative to
reduce liftings is left to the companies, the cuts
would fall most heavily on high-priced buy-back
oil. Most affected would be those Arab countries
that have already borne he brunt of the cut-
backs-Kuwait, Abu Dhabi and Libya.
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OPEC: OIL PRICES UP AGAIN
At their conference in Vienna last week, the
oil ministers of the Organization of Petroleum
Exporting Countries decided to freeze posted
prices, but to raise the taxes paid by the inter-
national oil companies. Depending on how each
of the OPEC members implements the tax in-
crease, the average cost of oil to the companies is
expected to increase between 40 and 50 cents per
barrel.
The ministers made an effort to convince the
consuming nations that the increase in taxes
could come out of oil company profits and
should not result in higher oil prices to the con-
sumer. It is unlikely, however, that the companies
the companies pass on the full
ax increase, the oil bill for consuming countries
will rise some $4.4-5.5 billion annually.
The ministers also decided that, beginning in
January 1975, the rate of inflation in the indus-
trialized countries will be taken into account in
setting oil prices. This action would preclude any
easing of the burden of oil prices as a result of
continuing world inflation.
COST INCREASE FOR
MAJOR OIL-CONSUMING COUNTRIES
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LAW OF THE SEA: UNRESOLVED
The UN Law of the Sea Conference at
Caracas ended its ten-week session last month
with a number of contentious economic questions
unresolved. The three committees into which the
conference was divided are now trying to
crystalize the major issues for presentation at
meetings to be held in Geneva next spring.
Committee 1
This committee is to tak' up questions re-
garding seabeds beyond the limits of national
jurisdiction, primarily deep seabed mining, but an
agreement seems further away now than at the
outset of the Caracas meeting. The establishment
of an international authority that would license
and regulate deep sea mining was generally ac-
ceptable to most participants, but neyotiators
were unable to agree on the framework and
power or the authority. Develophrg countries
already producing minerals on land favor the
imposition of strict controls to protect their
land-based industries. Developed countries-
concerned over the US technological lead in deep
seabed mining-are insisting chat a quota be
placed on the number of sites a;,y nation could
control.
Mining of high-purity mineral nodules-
which lie on the deep seabed in tremendous
quantities-could satisfy all of the world's
demand for manganese and provide substantial
amounts of cobalt, nickel, and copper. Com-
mercial production is likely in about ten years.
Committee 2
This group-covering territorial seas, straits,
and economic zones-seems certain to reach
agreement on a 12-mile territorial sea and an
additional 188-mile economic zone. Freedom of
navigation through straits and archipelagic waters
is receiving some support. Progress is also being
made in accommodating the demands of maritime
nations for "free passage" with the concerns of
straits states over security, safety, and pollution.
The extent of coastal-state control over
fishing, research activities, mineral exploitation,
and regulation of pollution in the economic zone
is still being negotiated. States with broad con-
tinental shelves-often extending beyond 200
miles-are seeking exclusive exploitation rights
over the full extent of the shelf. Offshore oil is
almost always found on the continental shelf.
The USSR and Japan are expressing growing
concern over these developments. Most of the
world fisheries lie over continental shelves extend-
ing from a few to several hundred miles offshore.
Imposition of a 200-mile economic zone could
drastically reduce the Soviet and Japanese fish
catch, a major source of protein for both coun-
tries.
The third committee is dealing with matters
pertaining to pollution and scientific research.
The developing countries are seeking a double
standard for pollution control-strict for the in-
dustrial countries, permissive for themselves. This
would enable them to pursue national develop-
ment plans-chemical plants and steel mills, for
example-without regard to protecting the marine
environment. Freedom to conduct scientific
research in the economic zone is gaining some
acceptance. Coastal states however, seek informa-
tion about the projects, an opportunity to partici-
pate in the research, and access to the data
acquired.
In the six months before the Geneva meet-
ing, these issues will be the subject of vigorous
negotiations. Warsaw has already agreed to play
host to an international symposium on world
fisheries to review developments at Caracas, while
the UN has planned a number of meetings, es-
pecially for groups dealing with seabed mining.
Current plans call for the conference to draft a
treaty at Geneva in the spring of 1975 and return
to Caracas in midsummer for an official signing
ceremony. Drafting probably will not be comple-
ted at the spring session, however, and a third
workin s ay be required.
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