WEEKLY REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001000080050-4
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 28
• Document Creation Date: December 27, 2016
• Document Release Date: May 13, 2010
• Sequence Number: 50
• Publication Date: November 14, 1975
• Content Type: REPORT

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Top Secret
meekly Review
To Secret
25X1
November 14, 1975 25X1
Copy N2 666
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The WEEKLY REVIEW, issued every Friday morning by the
Office of Current intelligence, reports and analyzes signifi-
cant developments of the week through noon on Thursday. It
frequently includes material coordinate.! with or prepared
by the Office of Economic Research, the Office of Strategic
Research, the Office of Geographic and Cartographic
Research, and the Directorate of Science and Technology.
Topics requiring more comprehensive treatment and there-
fore published separately as Special Reports are listed in
the content,.
CONTENTS (November 14, 1975)
MIDDLE EAST
AFRICA
1
Spanish Sahara: March Canceled; luvieib
3
India: Gandhi Exonerated
4
Angola: Two Regimes; Soviets
6
Bangladesh: Another Coup
7
Israel: Economic Problems Exaggerated
25X1
8
USSR: Anniversary Waltz
10
USSR: Styx; Peru; Mars;
12
Economic Summit
14
MBFR: Problems for the West
15
EC: Farm Policy Worries
15
Finland: New Government Likely
WESTERN
HEMISPHERE
17
Argentina: Impeachment Motion
18
Ecuador: A Shaky Presidency
19
Canada: Economic Controls an Issue
20
Guatemala-Belize: Seeking a Compromise
EAST ASIA
PACIFIC
21
Vietnam: Coping with Dissidents
22
Vietnam: Reunification Now
Comments and queries on the contents of this
publication are welcome. T:iey may be
directed to the editor of the Weekly Review,
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SPANISH SAHARA
On November 9, Morocco's King Hassan call-
ed off his "green march" into Spanish Sahara after
receiving new proposals on the disposition of the
territory from a high-level emissary sent by
Madrid. The King's action relieved Spanish con-
cern that the march would lead to hostilities
between the two countries. If Rabat and Madrid
have struck a deal that will transfer the territory to
Morocco, they will still have to contend with
Algeria, which opposes any direct annexation and
insists that a self-determination referendum be
held under UN auspices.
In a speech from Agadir that was studded
with conciliatory remarks about Spain, Hassan
stated that the mass march, which began on
November 6, had "accomplished its mission."
Hassan strongly implied that Morocco's claim to
the territory would be successfully resolved
through negotiations. His optimism was clearly
based on talks he held with a senior Spanish of-
ficial on November 8. Although Hassan did not
reveal any specifics of an understanding or a
framework for future negotiations, he had too
much personal prestige at stake to have backed
down empty-handed.
When Hassan called the marchers back, the
main body of Moroccans had advanced only a
few miles into a sector of the territory south of
Tarfaya. A second column had crossed the border
some 50 miles to the east. Spanish troops had pull-
ed back from loth areas.
The Moroccan marchers, who had been fired
up for their venture by nationalistic and religious
propaganda, reluctantly began to withdraw on
November 10. In general, the Moroccan public
has adopted a wait-and-see attitude toward the
King's speech. He will be under mounting
pressure, however, to demonstrate with more
than implications that progress is being made
toward a settlement favorable to Morocco.
On November 11, a Moroccan delegation led
by Prime Minister Osman went to Madrid to nail
down a firm agreement based on the apparent
understanding reached between Hassan and the
Spanish emissary. The inclusion of the director of
Morocco's national phosphate company suggests
part of the talks will deal with arrangements to
assure Spain a share in the profits from the rich
phosphate deposits in northern Spanish Sahara.
Mauritania, with which Morocco is willing to par-
tition the territory, is also pzrticipating in the
talks.
Both Rabat and Madrid are being
tig,.'-lipped about the new talks. Press reports
from ivia.rirl, however, suggest Spanish officials
are less optimistic about hammering out a final
agreement than are the Moroccans. Although
Spain is eager to get out of the territory and will-
ing to see it go to Morocco and Mauritania,
Madrid still wants the UN to play a role-possibly
by establir.hing a temporary trusteeship. Moroc-
co, however, wants to negotiate a settlement first
and then seek the UN's blessing.
Algeria, which condemned the Moroccan
march as an aggressive act, has continued to lam-
bast Hassan through its media. The Algerians have
also been playing up and p, obably exaggerating
clashes that have occurred this week in
northeastern Spanish Sahara between Mcroccan
irregulars, reinforced by some army units, and
guerrilla forces of the Algerian-backed Polisario
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Front. The Front, which has significant support
among indigenous Saharans, demands in-
dependence for the territory. Spanish troops have
pulled back to a defense perimeter that leaves the
northeastern region bordering Morocco, Algeria,
and Mauritania outside Spanish lines.
Algiers opposes a Spanish deal to divide the
territory between Morocco and Mauritania and
can be expected to remind Madrid of the
Algerian position. During a round of talks in
Madrid in late October, stern warnings against
such a deal conveyed by an Algerian delegaticn
helped persuade Spain's wavering government to
stand by previous Spanish promises to seek a UN
role involving a referendum for the disputed
territory.
Meanwhile, President Boumediene is trying
to persuade Mauritanicn President Ould Daddah
to accept Algeria's view. On November 10 the two
leaders met at Bechar; two days later Ould Dad-
dah flew to Morocco for further talks with King
Hassan.
Moscow's shift to a pro-Algerian position on
thL Spanish Sahara dispute has brought a
deterioration in Soviet-Moroccan relations.
In the UN Security Council, the Soviets sided
with the Algerian view that the Spanish Sahara
question should be resolved by the colony's in-
habitants. Pravda also weighed in on behalf of
Algiers, pointing out that the General Assembly
had twice approved self-determination for the
territory's inhabitants and voicing Moscow's op-
position to any effort to deny them this right.
Soviet UN representative Malik-with an eye on
King Hassan's mass march-urged restraint and
moderation on the concerned parties.
The Soviets have also reportedly responded
favorably to the Algerians' request for rapid arms
deliveries to strengthen their forces facing
Morocco and Spanish Sahara. Moscow apparently
helped facilitate the rapid transfer of Soviet-
supplied arms from Libya to meet the request.
Until a few weeks ago, the Soviets looked
benignly on King Hassan's irredentism. They had
tried to make a few points in Rabat by privately
suggesting sympathy for Moroccan annexation.
They had agreed in October 1974 to sell Rabat $30
million in arms, even though they were aware that
King Hassan would use the new equipment to
bolster his territorial claims.
The recent Soviet tilt toward Algiers may have
stemmed from:
? A Soviet decision to revert to their
long-standing position calling for self-deter-
mination.
? A desire to utilize the crisis t-, mend
their frayed ties with Algiers.
? Concern that endorsement of King
Hassan's mass march might give ideas to
countries-particularly China-with
territorial claims against the USSR.
? Interest in forestalling a Moroccan
stranglehold over the rich phosphate
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deposits in Spanish Sahara, which would
give Rabat nearly 80 percent of the world ex-
port market for the rock.
King Hassan has reacted strongly to the
Soviets' actions. He canceled the visit of a Soviet
delegation that was to put the final touches on a
new agreement expanding the USSR's involve-
meni in development of Moroccan phosphates.
Hassan also has dispatched an emissary to
Moscow to make his displeasure known.
Soviet diplomats in Rabat have displayed
meir discomfort and are trying to make amends.
They are now suggesting that self-determination
for Spanish Sahara does not necessarily equate
with independence. The USSR will probably make
further attempts to repair the damage so it can
continue to buy Moroccan phosphates. The
Soviets I'.ave been importing substantial quantities
of this basic fertilizer ingredient in order to
supplement their sagging production. Moroccan
phosphates may take on even more importance
INDIA: GANDHI EXONERATED
The Indian Supreme Court on November 7
overturned Prime Minister Gandhi's con'. Lion
last June by a lower court for relatively minor
violations of India's election law during her 1971
campaign. Gar? hi, now freed from the threat of
being barred from office for six years, may soon
take new political initiatives designed to con-
solidate her position further.
All five members of a Supreme Court panel
that heard Gandhi's case upheld election law
changes that retroactively eliminated the legal
basis for her conviction. The changes were
enacted by parliament in August after efforts by
Gandhi's politica! opponents to capitalize on the
lower court ruling had led her to impose a state of
emergency on June 26
In another decision, the Supreme Court
struck down a constitutional amendment that had
exempted the election of a prime minister from
challenge in the courts. This ruling, however,
does not affect Gandhi's case, in view of the
court's approval of the election law changes.
With her court case out of the way, Gandhi
might decide to ease some aspects of the
emergency, though she claims the emergency
was decreed because of a conspiracy against her
government and not because of her troubles in
the courts. This week she released J. P. Narayan,
one of her principal opponents, reportedly
because of his failing health. Narayan is the first
major political leader to be released from jail
since the ern -rgency began.
Gandhi may also make some constitutional
changes to further strengthen her control. In
recent months she has talked about reducing the
powers of the judiciary and enhancing those of
parliament, which her Congress Party domi-
nates. Her interest in taking such action may
have been heightened by a Supreme Court deci-
sion this week not to reconsider a ruling by the
court in 1973 that barred parliament from
amending the "basic structure" :If the constitu-
tion. Parliament is expected to convene this
month, and changes aimed at weakening the
judiciary may be on the agenda.
Gandhi could also decide to call a general
election when the present parliament's five-year
term expires next March, although she can legally
postpone the election under the state of
emergency. Gandhi and her party would enter
any election as heavy favorites. Most Indians
appear satisfied with-or at least reconciled
to- -her authoritarian rule, largely because it has
coincide, with an improvement in the nation's
short-term economic prospects caused by good
rainfall this year. Moreover, the opposition par-
ties, which in India's 28 years of independence
have never done well enough in a national elec-
tion to supplant the Congress as the country's
rulers, have been further weakened by the
government's repressive measures under the
emergency. Whether the opposition leaders still
in jail would be released in nrenaration for an
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AREAS
CONTROLLED OY+
MPLA *
FNLA W
ANGOLA
8 e diin III Serpe
ds,- Pinto
After almost 500 years of Portuguese rule, 13
years of national insurgency, and more than six
months of sluggish civil war, Angola drifted into
independence on November 11 with the
leadership of the state still being contested on the
battlefield. The three warring liberation groups
immediately set up two rival governments that are
now vying for international recognition.
The Portuguese left without transferriog
sovereignty to any of the liberation groups, simply
announcing that it was being turned over to the
"Angolan people." The Popular Movement for
the Liberation of Angola lost no time in asserting,
fron its Luanda stronghold, that it was the sole
legitimate heir of the Portuguese. Movement
leader Agostinho Neto was proclaimed president
of the country. Simultaneously, the National Front
for the Liberation of Angola and the National
Union for the Total Independence of Angola
jointly announced the establishment of their own
government in Nova Lisboa, which they renamed
Huambo.
Both sides have published constitutional
structures for their governments. The National
Front - National Union coalition has not officially
released its leadership slate, but it reportedly is to
be headed by National Front leader Holden
Roberto, with the National Union's Jonas Savimbi
serving as minister of defense. There is friction
between the two groups, however, and their
partnership is not as firm as their joint announce-
ment implied.
In the race for international recognition, the
Popular Movement took an early lead by receiv-
ing almost immediate recogti +ion from the Soviet 25X1
Union, Cuba, and four African states-Mozam-
bique, Guinea, Guinea-Bissau, and
Congo-whose leaders have long had tieE with
the Popular Movement. A number of East Euro-
pean governments have expressed their
"readiness" to establish diplomatic relations with
the Neto regime. So far, the National Front -
National Union regime has not been recognized
by any country. Zaire, Holden Roberto's long-
time backer, and the rest of Africa are observing
the Organization of African Unity's request to re-
main neutral pending formation in Angola of a
government of national unity.
As long as the OAU position remains un-
changed, neither Angolan claimant seems likely
to win enough support to gain general inter-
national acceptance. Soviet and Cuban recogni-
tion is important for Neto, however, since the two
countries can now assist the Popular Movement
directly and with greater ease and will not have to
channel their military assistance through in-
termediaries such as Congo. This week the Soviets
mounted another sizable airlift to West Africa, ap-
parently consisting of new supplies for the
Popular Movement.
The three groups did not let independence
ceremonies impede the military campaigns they
have been pressing for some weeks. The Popular
Movement dispatched troops and equipment
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southward to meet a combined National Front -
National Union force advancing tcward Luanda.
The force is still some 300 miles from the capital,
however. In the north, the National Front is still
trying without success to break through Popular
Movement defenses at Quifangando. This week
Front troops may even have been pushed back a
short distance.
In Cabinda, fragmentary information
suggests that heavy fighting is taking place
between the Popular Movement and forces of a
Cabindan separatist group that have moved into
the enclave from Zaire. The inability of the
separatist group's troops to achieve a quick vic-
tory in what was supposed to have been a surprise
attack suggests that the Popular Movement may
well continue to hold the upper hand at the pre-
sent time.
Neither the Popular Movement nor its adver-
saries are likely to win a decisive military victory
any time soon. The fighting will probably settle
into a seesaw war of attrition with the staying
power of the opposing forces being determined
by the amount of external military assistance each
can obtain.
SOVIETS MOVE QUICKLY
The USSR, as expected, moved quickly this
week to recognize its Angolan client-the
Popular Movement- -as the sole legitimate gover-
ning authority in the former Portuguese territory.
A communique establishing diplomatic relations
at the ambassadorial level between the Soviet
Union and the "People's Republic of Angola" was
issued in Luanda on Wednesday.
The move will almost certainly lead to more
Agostinho Neto's forces.
Meanwhile, the Sovie' press campaign on
Angola continues unabated, with Moscow
blasting "foreign interventionists" for their sup-
port of the Popular Movement's rivals-the
National Front and the National Union. The most
recent authoritative Soviet commentary appeared
last weekend in a Pravda article signed
"Observer." which indicates Kremlin endorse-
ment.
The "Observer" article reserved its heaviest
brickbats for the "racist" regimes of South Africa
and Rhodesia, apparently as part of an intensive
effort to elicit additional support for the Popular
Movement from other Black African states. This
effort apparently is needed because in other areas
of Africa, heavy-handed Soviet involvement with
the Popular Movement has backfired. In addition
to the break in diplomatic relations with Uganda,
Nigeria has publicly criticized the Kremlin's
"flagrant interference" in the affairs of Angola.
Lagos has reportedly denied overflight rights for
Soviet aircraft destined for Luanda.
struggle.
relations with the Popular Movement's adver-
saries if they ultimately prevail in the current
"Observer" also made the usual charges
against the Chinese but, in contrast to earlier
Soviet commentary, did not direct,y mention US
support for the Popular Movement's opponents.
This could mean that Moscow intends to play
down its earlier I:ne that the US and China are
supporting the same side. 25X1
Despite the Soviets' strong military and
diplomatic support for the Popular Movement,
they are apparently not closing their Angolan op-
tions. The "Observer" art;cle, like other recent
Soviet commentaries, suggested growing ner-
vousness in the Kremlin over the deteriorating
military position of Neto's forces. Moreover, "n a
recent conversation with US embassy officials, the
Angolan desk officer of the Soviet Foreign
Ministry refused to rule out the possibility of
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BANGLADESH: ANOTHER COUP
in the second violent change of government
within a week, enlist;. men loyal to Major
General Zia ur-Rahman on November 7
overthrew the five-day-old regime of General
Musharraf and made Zia the country's new strong
man. Zia appears to have a better chance of
stabilizing the situation than did his predecessor,
but discipline has not yet been completely
restored in the army's enlisted ranks, and he
could face a challenge from some other officer
seeking to take advantage of the delicate balance
of power in the military. The continuing instability
in Bangladesh has deepened concern among In-
dian officials who are keeping a vigilant watch on
the situation.
Musharraf early last week antagon'zed Zia's
many supporters in. the army by displacing Zia as
chief of staff and having him arrested. Widely cir-
culating allegations that Musharraf was pro-India
and that New Delhi had supported his bid for
power also probably played a part in spurring the
enlisted men to action; anti-Indian sentiment
runs deep among the ranks. There is no evidence
available to confirm either allegation.
On gaining power, Zia reclaimed the position
of chief of staff. He retained President Sayem, the
former chief justice who was appointed president
by Musharraf, and turned over to him the title of
chief martial law administrator. Zia and the other
service chief are to act as deputy martial law ad-
ministrators, but real power apparently will re-
main in Zia's hands.
Since becoming the new Bengalee leader, Z-a
has had to cope with a mutiny that broke out on
November 8 among enlisted men in the main
Dacca base. The troops sought to take advantage
of tie confused situation following the second
coup to settle old scores with their officers or de-
mand redress of various grievances. Several of-
ficers and dependents were killed and others
detained.-
As the mutiny unfolded, it became evident
that a far-left political group, the National
Socialist Party, had become a force among the
enlisted men. The party, which never developed
much support among civilians, seems to have
been able to capitalize on the grievances of the
troops.
By midweek the revolt appeared to have
abated. Most of the arms held by the rebels had
been returned to the base armory, and a majority
of the mutineers had rejoined their units. Officers
at the base apparently persualed the noncom-
missioned officers to join them in efforts to
restore discipline. Their effort is complicated by
contention in the officer corps between those
who fought in the 1971 war of independence and
those who were held in Pakistan until 1973.
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This week's events in Dacca may have in-
creased chances that India will try to influence the
situation in Bangladesh. New Delhi's uneasiness
was probably heightened by the fact that it was
once again caught off guard by a change of
government in Bangladesh and by anti-Indian
demonstrations that accompanied Zia's assump-
tion of power.
ISRAEL: ECONOMIC PROBLEM EXAGGERATED
Public pronouncements in Israel in recent
weeks lamenting Tel Aviv's deteriorating trade
situation and sounding the need for further belt-
tightening exaggerate the country's short-term
difficulties. The government's austerity program,
implemented in the summer of 1974, has achieved
its goal of lowering consumption in the civilian
sector. The still sizable current-account deficit is
being covered by substantial assistance from the
US and by other capital inflows.
Since the austerity program was im-
plemented in mid-1974, Israel has devalued the
Israeli pound by 40 percent, cut back nonessential
budget outlays, and instituted wage and tax
reforms. As a result of these policies, together
with the worldwide recession, Israel's real gross
national product fell 6 percent during the first half
of 1975 compared with the same period in 1974,
the first such decrease in nine years. Private per
capita consumption fell 5.5 percent, industrial
output 3 percent, and investment 11 percent.
The consumer price index cooled to a 12-per-
cent annual rate durng the first nine months of
the year, compared with 30 percent in the same
period in 1974. Despite the economic downturn,25X1
the unemployment rate at midyear was only 3.5
percent, compared with 3 percent at year-end in
1974. Increased emigration and frequent military
callups have limited the number of workers look-
ing for jobs..
Israel's current-account deficit this year,
while manageable, is likely to reach a record $3.7
billion. Exports, hindered by sluggish US and West
European demand, should grow only 5 percent. A
good harvest, which permitted expanded food
exports, will keep the increase from falling even
lower.
Israel will import $2 billion in defense goods
in 1975, 18 percent above the level in 1974 and
four times the 1973 prewar rate. At the same time,
the economic slowdown has cut back growth in
civilian impc,rts. Israel officials are forecasting a
4-percent increase in the value of these imports,
or a real drop of 5 percent.
The trade deficit is likely to increase by $800
million in 1976, mainly because of higher military
imports. This estimate assumes that nonmilitary
consumption will continue to be curtailed by Tel
Aviv's restrictive policies. Civilian imports are
likely to rise only 5 percent. Transfers and capital
receipts, including US assistance, will also in-
crease so that Israel will not need to draw down its
foreign exchange reserves.
During recent cabinet-level deliberations on
the fiscal budget for 1976, Finance Minister
Rabinowitz took a tough stand on the need for in-
creased austerity measures. This has led to rumors
of more devaluations, reductions in government
services, and new taxes. Major new measures will
not be required if the pending US aid bill is fund-
ed at close to requested levels.
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USSR: THE ANNIVERSARY WALTZ
The USSR observed the 58th anniversary, of
the Bolshevik Revolution last week in wayi that
seemed designed to avoid giving, meaningful
political signals. All the Moscow-based Politburo
members turned out for the festivities except F. D.
Kulakov, party secretary for agriculture and wide-
ly regarded as ,a political comer. Kulakov, who
also missed last year's observance, may have been
ill last week.
The Politburo chose Arvid Pelshe, the oldest
(76) and one of the least influential Politburo
members, to deliver the principal address on :the
eve of the holiday. It dearly would be hard for
any observers, inside or outside the USSR, to
build persuasive or tantalizing political
hypotheses: around the figure of Pelshe.
An effort was made to suggest that all is well
with General Secretary Brezhnev. On several oc-
casions Pelshe paid homage to Brezhnev, and
these references were greeted with "thunderous
applause." The television cameras repeatedly
focused on Brezhnev during Pelshe's speech, ap-
parently to show that he is still in charge and to
allay suspicions about his physical and political
well-being. Brezhnev also had well-publicized
meetings with. the heads of the Uruguayan and
Argentine Communist parties and this week zdd-
ed West German President Scheel to his list of
visitors.
As to the substance of Pelshe's speech, the
only noteworthy item on the domestic side was
his gloomy statement on agriculture. He reported
that since *e revolution agricultural production
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had not increased as rapidly as industrial produc-
tion and admitted that difficulties Lll have to be
overcome in the agricultural sector. Pelshe did
not give a harvest figure nor did he mention
Soviet grain purchases abroad. In his speech,
Pelshe also defended the Soviet record on human
rights and cii'icized "illusory and unreal"
democratic rights in the capitalist world.
The foreign policy portion of Pelshe's address
was a notably restrained recitation of familiar
Soviet themes. Detente received Pelshe's un-
inspired endorsement, together with the ritual
warning that its opponents-notably political
spokesmen for the "military-industrial complex"
-remain active. He made no prediction, as
Foreign Minister Gromyko has recently, that the
25th party congress will reconfirm Moscow's
current foreign policy line.
In contrast to Gromyko's anniversary address
last year, Pelshe accorded relations with the
Western powers perfunctory treatment. The US
received only one brief, albeit favorable,
paragraph; relations with Western Europe and
Japan were assessed in an additional three
sentences.
Pelshe referred to "realistic trends in t: rul-
ing circles" of the leading capitalist states, bu said
nothing about the contribution of summitry to
US-Soviet relations nor did he aiiude to
Brezhnev's next visit to Washington. He endorsed
further progress at SALT but, in a departure from
the usual order, mentioned both MBFR and
Soviet UN arms control initiatives before SALT.
Pelshe devoted considerable attention to the
world communist and "national liberation"
movements, including some warm words for
visiting North Vietnamese party chief Le Duan.
Pelshe's castigation of China's "Maoists" evoked
from his audience the only real enthusiasm
generated by the speech. He warned Peking
about "encroachments" on the "interests" of the
USSR and, in a new addition, its "friends."
The amour' of military equipment displayed
during the Moscow parade was well below that
exhibited last year. Only 151 vehicles participated,
compared to about 300 last year. The military
parade in Leningrad was similarly curtailed, con-
fined to a march-by of troops with no large items
of military equipment. In a break with previous
years, the Moscow par,..fe did not include
strategic missiles, tracked vehicles, or new equip-
ment of any kind. The Soviets did display the SA-8
and SA-9 surface-to-air missiles, indicating their
growing interest in tactical air defense.
Defense Minister Grechko's brief address in
Red Square on November 7 contained the usual
invidious comparisons of communist and
capitalist societies. He expressed satisfaction,
however, with the trend toward a relaxation of
world tension and toward cooperation among
states with different social systems. While
Grechko warned of "aggressive imperialist
forces," he singled out for specific criticism only
"Peking's leaders" and their "provocative
policy." He added that the party and government
are working to strengthen Soviet "economic ? nd
defense capacity." 25X1
Soviet leaders observe the parade
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USSR
the Soviets delivered at least 18 SS-N-2 Styx missile
crates to Somalia during October. These crates,
now av the missile-handling facility built by the
Soviets near the port of Berbera, are in addition to
two +hat have been in Somalia since spring.
Because of the size and elaborate nature of
the missile facility-capable of handling a wider
variety of Soviet naval missiles than just the Styx
-we believe that it was designed and built by the
Soviets primarily to support their naval missiles on
ships in the Indian ocean and eventually will be
used for that purpose. It appears that the Somalis
will share the facility with the Soviets.
crates were being unloaded. Some were on deck,
others were still in the hold, and two had been
moved to the missile facility. Subsegt25X1
photography showed 19 missile crates at the facili-
ty, including one which had been there since the
spring.
Photography of Berbera during October also
showed the Osa-II class guided-missile patrol
boat that was delivered to Somalia via the Suez
Canal in late September. Somalia will probably
receive additional Osas. Local officials told a
visiting US congressional group last July that the
Soviets were going to provide them, and the
number of Styx crates delivered appears to be
more than necessary for just one Osa. Further-
more, the Soviets do not appear to have a re-
quirement now for Styx missiles in their InrIian
Ocean naval contingent. 25X1
Osa-class patrol boats are equipped with four
SS-N-2 Styx missiles-which have a maximum
range of 25 nautical miles-as well as four 30-mm.
antiaircraft guns.
Moscow is continuing efforts to increase
arms sales to Lima, its only Latin American military
aid recipient outside of Cuba. The Peruvians are
considering Soviet offers made to an all-service
delegation that was in Moscow in August.
Previous Soviet arms agreements with Peru, total-
ing as high as $130 million, were concluded with
the army.
Current offers probably include air-defense
equipment-radar and antiaircraft artillery and
missiles-and MIG-21s, in which Lima has ex-
pressed an interest. The navy, which sidestepped
previous Soviet overtures, is considering a Soviet
offer of as many as six Osa- or Nanuchka-class
guided-missi,, patrol boats.
The Soviet-Peruvian military supply
relationship dates back to 1972-1973, when Lima
turned to Moscow because of continuing restric-
tions on US sales and the inability of West Euro-
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while Styx missile
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25X1
pean countries to meet delivery schedules. Soviet
prices and repayment terms were favorable-ten
years at about 3-percent interest-and accep-
tance of Moscow's military aid gave credibility to
Lima's nonaligned stance.
Lima has signed two arms agreements with
the USSR. The first, in 1973, included more than
200 T-55 tanks, 122-mm. and 130-mm. howitzers,
truck-mounted BM-21 rocket launchers, and
ZSU-23-4 antiaircraft guns. The second, conclud-
ed early this year, is a $30-million order for 30
MI-8 helicopters. All equipment ordered under
the agreements has been delivered.
Although initially satisfied with Soviet ground
equipment, the Peruvians are now having
problems with the tanks because of the need for
frequent repairs and the lack of spare parts.
Moreover, the Peruvian army is uneasy over the
growing number of Soviet military advisers that
accompany the arms and the required extensive
training of Peruvians in the USSR. About 50 Soviet
advisers are now in Peru, and about 150 Peruvian
military personnel are training in the USSR.
Peru is discussing arms purchases with
Western countries, including the US, but these
sources cannot match the combination of price,
credit terms, performance,'.and delivery
schedules the Soviets are offering. The recent
Lima-Moscow discussions will probably result in
orders for high-performance aircraft and naval
vessels. Moscow sees these orders as leading to
sales elsewhere in Latin America.
PROBLEMS WITH MARS PROJECT
In contrast to their recent successes with
Venus spacecraft, the Soviets are having problems
with their Mars project.
This year, for the second time since they
began exploring Mars in 1960, the Soviets did not
launch a probe. The opportunity for such a
launch comes every 25 months when Mars and
Earth are in the right positions. In 1973, the Soviets
used their largest operational booster to send
four spacecraft to Mars-two orbiters and two
landers.
Since 1972, there had been conflicting
evidence whether the Soviets were preparing for
a Mars probe in 1975. While there is no clear
evidence as to why a probe was not attempted
this year, we believe the energy that would be
required was the basic consideration.
The energy requirement for a Mars probe
this year was considerably greater than two years
r.go because Mars and Earth were farther apart. If
.he Soviets had used a booster with the same
rower as in 1973, less weight could have been
oelivered to the planet, and the Soviets may not
have been able to reduce the probe's weight.
A Mars mission this year may have depended
on the availability of a more powerful booster. In
1971, the Soviets started to build a new launch site
at Tyuratam that is strikingly similar to those
currently used to launch planetary missions. The
new site has extra facilities for storing liquid ox-
ygen and liquid hydrogen-high-energy
propellants capable of boosting heavy payloads
into oroit. The new site may have been scheduled
for completion in time for a 1975 Mars mission,
but it now looks as if it will not be finished until
late next summer. The next opportunity to launch
a spacecraft to Mars will occur in November 1977.
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ECONOMIC SUMMIT
Seeking Political Dividends
At the economic summit in Paris this
weekend European and Japanese leaders-ac-
companied by their foreign and finance
ministers-will all be looking for results they can
use to bolster their national and international
positions. The US will be importuned by the
French to return to international monetary
"stability" and by others to give priority to the
harmonization of economic policies. US support
may also be sought in the dispute over a separate
seat for Britain at next month's conference of
developed and developing states. The developing
states will probably look at the summit results as
indicating the degree of solidarity existing among
the developed countries as the December con-
ference approaches.
The French have been seeking a return to fix-
ed-later amended to "stable"-currency ex-
change rates since President Giscard first called
for the conference. West German, British, Italian,
and Japanese leaders, at first reluctant to par-
ticipate in such a forum, have come to recognize
their stake in successful talks on this or other
issues. The summit will therefore cover a broad
range of issues. In addition to a discussion of
monetary problems, the agenda has expanded to
include economic policy coordination against
recession, trade in raw materials, development
problems, and East-West trade. In addition, the
leaders may discuss the threat of trade protec-
tionism and the status of the Multilateral 'Trade
Negotiations in Geneva.
Of all leaders at the conference, Giscard has
the greatest political stake in demonstrating some
visible progress. A successful summit would help
restore a sense of dynamism to French foreign
policy in the wake of the snub delivered to
Giscard during his recent visit to Moscow.
Another consideration, which the US embassy in
Paris says is not being discouraged by French of-
ficials, is that the summit represents a success for
the French aim to participate in an exclusive
group that would lead the other industrialized
democracies. Seeing no chance for an early
agreement to return to fixed exchange rates,
Giscard professes this is only a long-term goal;
now hn. wants a commitment to work towards less
flexible, "viscous," exchange rates.
In addition to its interest in monetary affairs,
Paris will urge acceptance of the French view in
favor of establishing worldwide price agreements
on raw materials. The French will push this argu-
ment in relation to trade with the developing
world and trade in agricultural goods-particular-
ly grains.
West German Chancellor Schmidt's principal
aim at the summit will be to push his views on
greater coordination of economic policies among
industrialized states. Germany faces national elec-
tions next fall, and success in making his views felt
would reinforce Schmidt's international and
domestic standing.
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Schmidt will ask that the US review its
economic policies with an eye to helping lead
other countries out of recession. Schmidt may
raise the issue of harmonization of export credit
policies but is not likely to get a favorable hearing
from Giscard on this.
Schmidt will also support moves to develop a
common strategy for the developed countries at
the Conference on international Economic
Cooperation next month. This conference will
bring together ministerial-level representatives
from 27 industrialized, oil-exporting, and poor
developing states to discuss energy, raw materials,
development, and related financial issues.
Flexible exchange rates have generally
favored the UK, and London initially was among
the most reluctant to accept Giscard's invitation
to discuss their abolition. Prime Minister Wilson's
foremost concern will be to secure cooperation
from the other participants to help the UK meet
its current economic problems. He will probably
not ask directly, however, that the US and Ger-
many expand their economies at a faster rate. Fac-
ed with increased demands at home to impose
barriers to imports, Wilson may seek understan-
ding from other leaders of pressures that could
push him to move toward protectionism.
The West Germans and French could seize on
these British requests to get London to soften its
stand on separate representation at the
December conference. The British move has
stymied efforts by the industrialized states in the
Organization for Economic Cooperation and
Development to select their eight representatives
for the conference. The original plan called for
single representation of all the EC members, but
Britain has insisted that its interests as an oil
producer and a financial center cannot be ade-
quately represented by the EC. Giscard and
Schmidt may use the opportunity to point out the
inconsisiency of British claims to independence
on energy matters with London's pleas for
recognition of its dependence on other economic
issues.
Italy, not invited to the summit at first, will
have in many ways fulfilled its major goal simply
by attending. Rome will also be looking for help,
however, in reflating its economy, but the
relatively minor role Prime Minister Moro and his
advisers are likely to play in other areas will, in
some ways, only serve to re-emphasize Italy's
junior-partner status.
Italian participation will also highlight the
frustration of the smaller EC members and other
Europeans who are not participating in the sum-
mit. These states, who are resigned to, but not
pleased with, their exclusion would prefer utiliz-
ing already established international forums
where they are represented. The small EC states in
particular will question whether the summit ap-
proach can do anything but hinder EC efforts to
coordinate economic and financial policies.
Canada is particularly displeased with Paris' ada-
mant refusal to consider participation by Ottawa
in the face of statements of support from the US
and other participants. Paris will apparently try to
make amends by pushing Canada as one of two
co-chairman of the Conference on International
Economic Cooperation.
The summit is a particularly important
political event for Japan: it is the first time Tokyo
has participated in such a meeting since before
the war. Tokyo still feels unsure of its position,
however, and may wonder wF,ether it has in fact
been in on all of the advance work between other
participants.
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MBFR: PROBLEMS FOR THE WEST
The force reduction talks in Vienna have
marked time s1;ice the seventh round began in
mid-September, awaiting the introduction of the
West's nuclear proposal. Differences among the
Western allies make it uncertain, however,
whether the proposal will be tabled before the
round ends in December.
The West's nuclear proposal would add to
the basic allied negotiating offer a willingness to
withdraw some US nuclear warheads and delivery
systems from Europe. It also would offer to in-
clude discussion-but not reduction-of air force
manpower levels in the negotiations. The
proposal is designed to obtain Soviet withdrawal
of a tank army and agreement to a common man-
power ceiling in order to arrive at the overall
numerical equality of forces that NATO is seek-
ing. The Soviets have been insisting that the
reductions include Western nuclear and air
forces, which they contend make up for the
Soviet advantage in ground manpower and
equipment.
Substantial progress has been made in allied
negotiations on how and when to table the
nuclear proposal. The few issues that now remain,
however, are especially difficult. Expecting that
the negotiations will move forward once the
proposal has been introduced, and believing it
the biggest bargaining chip the West is likely to
play, some European allies-notably the British
and the Germans-seek to ensure that the
proposal i!, not presented until the allies decide
among themselves how to respond to Soviet
demands for European force reductions.
The Europeans are especiaily concerned that
the allies not signal any willingness to reduce or
limit European-as opposed to US-arms and
equipment. The Germans, whose large army i~ of
special concern to the Soviets, are arguing for a
cul!ective allied reduction commitment to avert
the possibility that Germany will be singled out to
take all or most of the European reductions. Apart
from the immediate desire of the Germans to
avoid individually any diminution in their own
security, the more general European interest is to
Page 14 WEEKLY REVIEW Nov 14, 75
avoid commitments to the East to discuss matters
that would give the Soviets a voice in West Euro-
pean defense discussions and limit allied military
flexibility.
As a result of these anxieties, there have been
several discussions in the EC in recent months on
the Vienna negotiations, largely at the insistence
of the Germans. Bonn has argued that these dis-
cussions are designed merely to define distinctly
European interests in a force reduction agree-
ment. They have thus sought to involve the
French, who do not participate in the Vienna
talks, both in order to neutralize the effect of
French opposition to the force reduction talks on
the German domestic scene and to draw Paris into
discussions of European security.
While enthusiasm for the discussions in the
EC appears to have waned in recent weeks under
the twin burden of intra-European differences
and strong opposition from NATO, the discussion
participants continue to resist invitations i.-om
NATO to report in detail on their deliberations,
and the talks are likely to continue in a variety of
alternative forums.
Bonn a1id London have suggested another
trilateral meeting of the US, German, and British
representatives to work out allied differences
over the nuclear proposal. The US has resisted this
bid on the grounds that such a meeting would
make it impossible to table the nuclear proposal
before the end of the present round. Because it is
asst'med that the allies basically favor an agree-
ment, there is some reason to think that the
remaining differences can be worked out in
bilateral sessions. Presentation of the nuclear
proposal during the present session is
nevertheless in doubt.
Aware that the West hopes to table the
long-awaited proposal during the present round,
the Soviets reacted initially by disparaging the
mi.ary significance of the proposed nuclear
withdrawals and demanding that the offer also
respond to their desire for reductions in West
European forces that the West has reserved for a
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later phase. This denigration of the Western
proposal is mainly tactical in nature, intended to
show that the Soviets do not regard it as a pan-
acea. The Soviets will probably be receptive to the
proposal if and when it is tabled. Ever since the
start of the negotiations the Soviets have insisted
that nuclear elements be included in the reduc-
tions, and they can scarcely reject a proposal in
which NATO finally moves toward acceptance of
their position. While the Soviets will thus
probably agree to incorporate the nuclear
proposal as an element in the negotiations, this
does not mean that they will accept all of its
specifics or that a meaningful agreement will
quickly follow.
The Soviets still appear to be interested in
making progress in the negotiations and have
offered a modification of their approach to the
question of defining whether intermediate types
of forces fit into air or ground categories. It
appears that the Soviets are toying with ways to
juggle force figures in such a way that the
appearance of a common ceiling will be created.
This approach will probably be unacceptable to
the West because the underlying disparity would
not be affected, but the Soviet move could
foreshadow greater willingness to meet Western
FINLAND: NEW GOVERNMENT LIKELY
The prospects for the formation of a new
majority coalition government, needed to deal
effectively with Finland's difficult economic
problems, were enhanced last week by the vic-
tory of the Social Democrats in a hard fought
election for control of the Metalworkers'
Union, Finland's largest and most influential
union. Following inconclusive parliamentary
elections in September, most party leaders
were unwilling to talk seriously about the
makeup of the next government until after the
Metalworkers' election. A Communist victory
would have further complicated efforts now
under way to form a government and raised
doubts about the ability of the next govern-
ment to come up with strong economic
measures.
Page 15
concerns once the nuclear proposal has been for-
mally presented.
EC: FARM POLICY WORRIES
The EC has begun a thorough review of the
common agricultural policy that will receive
high-level attention when the nine heads of state
and gcvernment meet in December. Last year,
Bonn made the review a condition for West Ger-
man consent to an increase in farm support
prices. Despite the polemics during the past year
over EC farm policy, attention is now focused on
several modest reforms. The Nine presumably
have realized that the common agricultural policy
already represents so many carefully worked out
compromises that radical changes are politically
impossible.
During its initial months, the review was
hampered by the campaigning before the June
referendum on continuing British membership in
the EC that made an oversimplified reform of
The Social Democrats captured 259 of the
506 seats to the Metalworkers' convention on
December 14. The Communists won 240 seats,
while the Center Party took 7 seats. Earlier
predictions of a close tally that would have
enabled the Center Party to cast the deciding
votes did not pan out.
The Social Democrats now have the upper
hand in charting the course of the union for
the next four years. Although the margin of vic-
tory was slim, the Social Democrats' morale will
get a boost from their election showing. Their
discouraging performance in the parliamentary
elections and a scandal involving the smuggling
of funds from West Germany and Sweden to
aid in the Metalworkers' election had seriously
dampened party enthusiasm.
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agricultural policy an issue. Since then, the British
have had little to say, but the West Germans, the
French, and the Italians have contributed
acrimoniously to the debate.
Chancellor Schmidt, a former finance
minister and the first postwar chancellor to have
few inhibitions about seeking political influence
commensurate with West Germany's economic
strength, has long made political hay out of his
criticism of waste and inefficiency in the Brussels
bureaucracy. With an eye to stringent budget
pressures in Bonn and close national elections
next year, Schmidt has been especially critical of
any moves o raise community expenditures for
agriculture.
In France, rivalry between President Giscard
d'Estaing and Prime Minister Chirac has added to
the difficulty over EC farm policy. Chirac made his
national reputation during 1972-1974 as an
agriculture minister who advanced the interests
of the French farmers through theatrical tactics in
Brussels. At Chirac's insistence, Paris contravened
EC regulations this fall with a tax on Italian wine
shipments.
Italian Agriculture Minister Marcora has
been particularly aggressive in promoting Rome's
point of view. He has emphasized that the Com-
munity allocates a larger share of its resources to
support thee prices of agricultural commodities
produced in northern rather than southern
regions, and he asks corrective action. Marcora,
who owns a livestock and dairy farm in Italy's Red
Belt, operates from a strong position in Rome as a
leader on the rise in the newly influential left
wing of the Christian Democratic Party.
Implementation of several reforms suggested
by the EC Commission would greatly extend the
scope of the Community's common farm policy,
but such steps are likely to face stiff opposition in
the member countries, the changes are aimed at
overcoming some of the long-standing problems
associated with the common agricultural policy,
especially with regard to surplus production, but
implementing the changes would require ad-
ditional expenditures-a step certain to be
criticized in a time of economic difficulty.
The member states are nevertheless getting
down to considering politically feasible reforms.
Some members hope to clear up misunderstand-
ings about the program and prove that the com-
mon tam policy is not the drain on EC resources
that its critics allege.
Future debate will take place at several levels,
with Commission and national officials working
closely with representatives of farm organizations.
The EC heads of government, however, will
probably have to establish guidelines for farm
policy reform when they meet in Rome at the
beginning of December.
Within the next few months, the EC is likely
to endorse Commission suggestions for more
stockpiling of farm products, long-term contracts
for overseas sales of food, and the adjustment of
grain price ratios to encourage use of surplus
low-grade wheat as a feed grain. The EC is less
likely to accept Commission proposals looking
toward gr .ater producer responsibility in
avoiding surpluses, increased firm size, more use
of direct payments to farmers as a substitute for
price supports, and extension of the common
agricultural policy to more products.
Nearly three fourths of the EC's budget is
spent on agriculture, with dairy support the
largest single item. National critics find Brussels an
easy target for the planning that leads to surpluses
of milk, butter, beef, and wine.
The member governments nevertheless
recognize that the large proportion of the Com-
munity's budgetary outlays devoted to agriculture
is necessary because Brussels has assumed
budgetary responsibility from national
governments. Moreover, more EC farmers are in-
volved in the troublesome dairy sector than in any
other. Even at the height of bitter debate during
the past year, none of the EC members has
spoken out in favor of dismantling the Com-
munity's agricultural program and returning to
national
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ARGENTINA: IMPEACHMENT MOTION
An impeachment motion against President
Maria Estela Peron, introduced late last week, is
gaining support in congress. The motion charges
gross incompetence as well as large-scale misuse
of public funds.
At least three opposition political groupings
have already lined up behind the motion, and the
largest opposition group, the Radical Civic Union,
seems to be moving in that direction. Parties
allied with the Peronists in the governing coali-
tion are said to favor impeachment also, at least
unofficially.
Recent schisms within the Peronist party may
provoke defections that could ensure passage of
the motion. Late last week, the party formally ex-
pelled Buenos Aires Governor Vittorio Calabro, a
prominent unionist and spokesman for those
Peronists who oppose the President. The US em-
bassy reports that his ouster could well provide
the 20 or so Peronist votes needed for passage of
the measure.
Peron's recent actions have led some to
speculate that she is deliberately seeking to
provoke a military coup and thus achieve a kind
of martyrdom. She remains isolated in he-
hospital room, taking counsel only from a small
clique of followers of ousted Lopez Rega. During
the period of her hospitalization, Peron has ig-
nored requests from cabinet members that she
meet with them to discuss government business.
Military leaders, who could at any time
remove the President, hesitate to do so Iest they
incur widespread popular disaffection as they did
two decades ago when they moved against Juan
Peron. Indeed, military spokesmen have
reportedly told influential civilians not to expect
the armed forces to step in and provide a solution
to the leadership problem. The spokesmen say
they will take over only if the government com-
pletely collapses; the added that if they are forc-
ed to do sot eturn power to
civilians 25X1
President Peron following her recent resumption of the presidency
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cent signing of a bill making journalists "liable for
crimes against the state," plus the arrest of former
Ecuadorean president Arosemena and conser-
vative leader Trujillo, may be evidence of a
decrease in civilian influence.
creasing, and his future is put in doubt by. eroding$
military support.. and increasing political and
The President's inability to deal with
economic problems has added to public discon-
tent. Popular economic measures, such as the re-
cent reduction in import tariffs, have been
overshadowed by persistent problems in labor,
industry, and agriculture. The labor unions
appear to be Rodriguez' most immediate
problem. Labor. leaders have reportedly stated
that' if yesterday's general strike does not bring
results, they will try again with a longer one. The
President's reaction may well be a factor affecting
his longevity as the nation's leader.
President Rodriguez is also faced with. rr:-k-
ing a decision on oil policy, which will affec, all
areas of they economy. He will have to decide how
to adjust the price of Ecuador's oil in light of the
recent OPEC increase. If the selling price is forced
up, Ecuador's oil will no longer be competitive
and significant oil revenues will be lost. Even if the
oil remains competitive because of market.fluc-
tuations, a price hike without tax relief for the oil
companies will reduce the already lagging incen-
tive to exploit existing sources of oil, upgrade
facilities, and undertake : further exploration.
Despite all the problems the President faces,
there is still no coordinated movement to replace
him. Opposition. to his regime,. however,. isin-
economic pressures.
ECUADOR: A SHAKY PRESIDENCY
President Rodriguez continues to hold on to
the presidency; but only because the military is
disunited and unable to agree on a successor.
Despite his best, efforts, Rodriguez has not been
able to gain the support of the military, and his
regime still' is plagued by discontent, economic
problems, charges of corruption, and plotting.
The President's intention in the long term to
restore civilian control of the government has suf-
fered -a setback. Last month's cabinet changes,
which-removed two civilians from their posts, in-
creased the military's dominance. Rodriguez' re-
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CANADA: ECONOMIC CONTROLS AN ISSUE
Ottawa's attempt to deal with Canada's in-
flation-plagued economy is having an impact on
both federal and provincial politics. At last week's
Liberal Party convention, 20 percent of the
delegates voted in favor of holding a leadership
convention, a blow to Prime Minister Trudeau's
formidable political prestige. In the western
province of British Columbia, left-wing Premier
David Barrett called an early provincial election,
ostensibly to seek a mandate to take tough an-
ti-inflation measures.
Trudeau admitted to the press that the size of
the vote favoring a leadership convention-dou-
ble that at the convention in 1973-showed a
"significant measure of dissatisfaction." One of
the motives behind the government's introduc-
tion of the controversial wage and price control
program was to refurbish Trudeau's image as a
"take-charge" leader in order to head off a
sizable vote against him at the convention.
Failure to appease the party dissidents was
due in large part to the control program's shaky
start and blunders by the government. The bill to
formalize institution of controls remains bogged
down in parliamentary committee, and opposi-
tion members predict that it will take another two
or three weeks to win approval. Meanwhile, the
proposed Anti-Inflation Review Board designed
to administer the program is still in the
organizational stage, and its regulations remain
unpublished.
Canada's powerful labor unions continue to
oppose the control program and are planning a
court challenge. Negotiations in the postal
workers' strike, now in its fourth week, have
resolved all but the key wage dispute. Talks broke
off last week with the union still demanding con-
siderably more than the maximum allowed under
government guidelines. Despite the challenge
presented to his programs by the postal strike,
Trudeau insists that the government has no im-
mediate plans to intervene.
The US embassy notes the government may
be fortunate that the first challenge comes from
the postal clerks and handlers. The union does
not have a strike fund, and its leadership is viewed
with disdain by other labor leaders. The Trudeau
administration needs to win this initial confronta-
tion to maintain the credibility of its economic
program with the public.
British Columbia Premier Barrett cited
Canada's economic problems as the chief reason
for calling the election in his province. Normally,
none would be held until early 1977. Nationally,
the party is strongly opposed to the federal con-
trol program, but Barrett has recently given it
some support at the provincial level. Despite this
action and Barrett's recent sponsorship of legisla-
tion forcing striking workers in key provincial in-
dustries back to work, Barrett retains the support
of organized labor. The overriding reason for the
early election in British Columbia, however, is
probably the strictly partisan desire to act before a
required redistricting of parliamentary con-
stituencies takes place that might favor the op-
position.
Alberta's Progressive-Conservative Premier
Lougheed remains the only holdout among the
provincial premiers in refusing to support the
federal economic controls. Quebec, however, is
the only province that has gone so far as to
authorize its own Anti-Inflation Review Board.
Despite press rumors, Trudeau will not risk
calling an election early next year to test support
for his economic program unless he sees a quick
improvement in his political stock. The economic
controls will take time to be fully tested, and
mounting public displeasure over the likely immi-
nent abolition of the death penalty will require
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GUATEMALA-BELIZE
Seeking a Compromise
Guatemalan leaders are looking for ways to
defuse the volatile Belize issue, but time and
political considerations stubbornly held by the
three parties involved in the dispute may be
working against a peaceful settlement.
The reinforcements sent into Belize last week
by the British in response to a buildup of forces
on October 31 on the Guatemalan side of the
border have convinced the Guatemalans that
London is determined to defend against an inva-
sion British forces in Belize, now about 1,100
troops plus six Harrier attack aircraft-which are
vastly superior to any airpower Guatemala
has-have the capability of defending all but
remote jungle areas of Belize. Faced with the
strong probability that a military action with even
a limited objective would fail, the Guatemalans
are seeking to find a solution through
negotiations with the British.
Guatemala has accepted as a foregone con-
clusion that the British-sponsored resolution on
Belize will be adopted by a large margin in the
UN. Guatemalan leaders then will have to carry
through on their threats to respond with military
action, or risk losing face.
Not yet willing to foreclose all options short
of war, a Foreign Ministry official this week held
the door open to the possibility of renewed
negotiations with the British. He said that there
can be many ways to resolve the issue peacefully,
such as the international Court of justice, arbitra-
tion, or a friendly mediator. The implication is
that Guatemala very much wants the US to take
on this role-and, of course, to favor Guatemalan
interests, In another attempt to reach a solution
through diplomacy, Guatemala this week laid the
groundwork for interventicii by the OAS. The
OAS played a major role in calming the last
flare-up of the Belize dispute in 1972.
The reaction to the British reinforcements has
thus far been restrained, although the
Guatemalans are concerned that incidents with
British forces patrolling the border could occur
and lead to a clash of serious proportions. Mexico
has proposed a compromise resolution that calls
for the parties involved to refrain from any action
that would delay negotiations or jeopardize har-
mony in the region. Guatemala seems willing to
accept the Mexican proposal, but feels that it has
come too !ate in the game and has no real
possibility of acceptance in the UN.
Domestic Reaction
What the Guatemalans are really looking for
is some gesture from the British indicating that
meaningful negotiations are a distinct possibility.
President Laugerud will need something to offset
the domestic reaction, both from the public and
from the hawks in the military, that seems certain
to follow passage of the British resolution.
A public announcement before the UN acts
on the resolution, coupled with a private ap-
proach by the British to give Guatemala some
clear indication of what London has in mind to
settle the dispute, would probably be enough to
prevent, or at least forestall, an outbreak of
hostilities. If the British do not offer a face-saving
device, the risk of a military conflict will increase.
Still, there is no guarantee that London would
be able to persuade Belize to agree to
Guatemala's very exacting demands. Guatemala
has in the past insisted on a sizable chunk of Beli-
zean territory, in addition to satisfying economic
and security concerns, before it would relinquish
its claim. The Belizeans are hardly likely to agree
to any significant territorial concessions.
Guatemala would have to scale down its demands
considerably in order to make headway on a
settlement. At this point, there are few signs that
either side would he willi.,o r., back down.
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VIETNAM: COPING WITH DISSIDENTS
Some limited resistance and acts of banditry
by various ethnic and religious groups and former
government soldiers have been reported in South
Vietnam since shortly after the collapse of the
former government last April. While these various
anti-communist forces To not pose a serious
threat, they nonetheless have been a thorn in the
side of the communists and have forced the new
regime to expend considerable effort dealing
with them.
Follow!ng the communist victory last spring,
former South Vietnamese military personnel were
ordered to turn themselves in to the new ad-
ministration for registration and re-education.
Less than two thirds reportedly complied. Many
simply shed their weapons and uniforms and
blended into the population, while others fled to
remote areas where communist control was
weaker. Former troops who kept their arms have
been in the vanguard of opposition to the com-
munists.
Some of these resistance forces have
reportedly been able to initiate fairly large-scale
attacks in the delta, the highlands, and northeast
of Saigon. In these areas, they have attacked com-
munist convoys, captured military supplies and
food, and temporarily cut major roads. For exam-
ple, Route 4 in the delta and Route 20 between
Dalat and Saigon have frequently been disrupted,
and travel at night along coastal Route 'I has oc-
casionally been stopped.
the communists were beginning to
fighting. Sharp fighting reportedly resulted from
some of these actions, in which the communists
made good use of tanks and captured US-made
helicopters. Preliminary indications are that the
take s ronger action against the resistance forces
in the central highlands and coastal provinces.
Elements of as many as four North Vietnamese
divisions were dispatched to areas of heavier
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communists dealt some severe setbacks to the op-
position forces, especially tribal elements in the
central highlands and guerrilla troops in the delta.
Such opposition is likely to continue in South
Vietnam for some time, but the communists have
sufficient military strength to maintain stability
and order. Moreover, since each of these opposi-
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elements can operate effectively in only a
single area, communist forces can concentrate on
eliminating their presence one by one.
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VIETNAM: REUNIFICATION NOW
The announcement last weekend that the
Vietnamese 'communists will convene a con-
ference on reunification indicates Hanoi is ready
to proceed swiftly to join formally the two coun-
tries. The process could be completed this
year-or early next.
The joint North-South conference will be a
cosmetic exercise, giving the appearance of
mutual agreement between "northerners" and
"southerners" to what has been a political reality
since the collapse last April of the former govern-
ment. Vietnam has already experienced de facto
reunification under a single party and military
structure, with Hanoi essentially making all the
important administrative, economic, and political
decisions.
The conference will get under way soon in
Saigon. The heads of both delegations are ranking
members of the North Vietnamese Politburo.
Truong Chinh, head of Vietnam's National
Assembly, heads the North's contingent, and
Pham Hung, the party's chief in the South, will
head the South's.
The conference will formulate plans for a
new national assembly and new "common" state
organs, suggesting that Hanoi will use the North
Vietnamese governmental structure as a model
and expand established legislative and executive
organizations to include southerners. The
proposed elections are for a new countrywide
national assembly and will serve as a plebiscite,
reflecting the so-called "national will" of the peo-
ple for a reunified state. In reality, the assembly in
the North has no power, merely rubber-stamping
decisions of the Politburo and the Central Com-
mittee. The impression left by the announcement
is that the elections will be soon.
Since the communist victory, leaders in both
zones have made it clear the ultimate goal was a
reunified Vietnam. There have been :xed signs,
however, on how rapidly this process would oc-
cur and what form it would take. One reason for
the confusion was the rapidity of the communist
military victory. When Saigon collapsed Hanoi
almost certainly had no formal timetable for
reunification.
Most of the early indications pointed to a
gradual process of reunification, which many
scurce.; in and outside of Vietnam maintained
'ould take at least a year or two. The communists
themselves added to such speculation by pressing
foreign governments for diplomatic recognition
of the South's Provisional Revolutionary Govern-
ment by maintaining that economic aid would
have to be provided separately for each state and
by an effort last summer to gain separate
membership in the UN for both Vietnams.
Southern communist leaders in the early stages
after victory seemed to suggest that reunification
would have to be gradual to give time to over-
come the severe economic and administrative
problems brought on by the sudden collapse of
the former government.
By late summer the signs of a "gradualist" ap-
proach to reunification had begun to disappear.
Public statements by Vietnamese leaders carefully
avoided any suggestion of an independent South
of indefinite duration, a promised civilian ad-
ministration never materialized, and no foreign
state was permitted to establish a diplomatic
presence in Saigon.
Starting in June and possibly lasting into
September, senior southern and northern officials
held a series of meetings in South Vietnam. It
seems entirely plausible that Hanoi's decision to
move ahead on reunification was revealed and
procedural matters worked out during the course
of these sessions.
The intriguing question is why Hanoi decided
to move away from a scenario that seemed to
provide for a separate southern administration.
The question was obviously debated within the
North Vietnamese leadership because a separate
southern regime presented both advantages and
problems for Hanoi. Many diplomatic observers
in Hanoi for instance thought the gradualist ap-
proach would prevail, in part, because North
Vietnam believed that a facade of southern in-
dependence would help attract aid, trade, and
foreign investment.
Hanoi may have decided, however, that any
diplomatic or economic benefits to be derived
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from two Vietnams would be outweighed by in-
ternal political and administrative problems. The
North Vietnamese also may not have wanted to
accept the risk that a separate southern ad-
ministration might lead to the growth of vested
southern interest in a degree of political
autonomy.
Another factor may well have been the
prospect of inevitable Sino-Soviet rivalry for in
fluence within a separate southern ad-
ministration-perhaps in itself ei.ough to cause
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Whitlam
AUSTRALIA: A TIME OF ACRIMONY
Australia may be entering a period of un-
precedented disorder in the wake of the Gover-
nor General's sacking of former prime minister
Whitlam. Inflammatory remarks by Whitlam
could turn scattered demonstrations and work
stoppages supporting him into a nationwide
general. strike, despite calls for restraint by some
trade union leaders.
Whitlam's insistence that, the Governor
General's action was unconstitutional: raises the
possibility that he will challenge his dismissal and
will contend that the caretaker cabinet headed by
Liberal Party leader Fraser has no legal standing.
Whitlam may calculate that pressing con-
stitutional issues will place him and his party in
the strongest possible position for the election on
December 13, which he recognizes cannot be
avoided even though called by a government he
regards as illegal.
Whitlam will play heavily on concern that the.
precedent now established-that the Senate has
the power to force national elections for the
House of Representatives-could result in such
frequent elections that political stability would be
undermined. Whitlam may propose that the
Senate's wings be clipped for its flouting of the
convention honored since Australia's federation
in 1901-that the upper house should, not block
appropriations even though it has the con-
stitutional authority to do so.
Labor will also seize on a widespread feeling
that the Governor General, in unilaterally dismiss-
ing Whitlam, overstepped the ceremonial role
Australians expect of this honorary representative
of the Crown. Labor might conclude that a revival
of the idea that Australia declare itself a republic
could win votes. In focusing on such issues as the
Senate and Governor General, Whitlam would
hope to minimize discussion of his government's
limited achievements.
The election campaign promises to be the
most acrimonious in Australia's history. United as
never before by what they see as the Governor
General's departure from impartiality, the
Laborites will wage a stiff fight. Labor risks a
strongly negative reaction, however, should it en-
courage demonstrations and strikes to the point
of causing major economic dislocations.
National preoccupation with the month-long
struggle over the budget distracted the public
temporarily from its dissatisfaction with Labor's
performance. Fraser will work hard during the
campaign to capitalize on Labor's poor record in
dealing with Australia's economic- problems.
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