WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A007500060001-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 33
• Document Creation Date: December 21, 2016
• Document Release Date: May 14, 2008
• Sequence Number: 1
• Publication Date: January 2, 1970
• Content Type: MF

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State Dept. review completed
DIA review(s) completed.
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Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
Secret
oo.
2 January 1970
No. 0351/70
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SECRET
C O N T E N T S
(Information as of noon EST, 31 December 1969)
Far East
THE WEEK IN PERSPECTIVE
VIETNAM
North Vietnam's party first secretary Le Duan has
been conspicuous by his absence from recent im-
portant occasions in Hanoi. In the south, Commu-
nist military activity has been generally light,
and President Thieu is still pressing for the
ouster from the Lower House of three deputies
accused of Communist sympathies.
PEKING CONTINUES ATTEMPTS AT PARTY BUILDING
The Chinese Communists appear to be trying to step
up the rebuilding of their shattered party appa-
ratus.
JAPANESE GIVE SATO RINGING ENDORSEMENT
The ruling conservatives' sweeping electoral
victory has left Japan's political opposition
more fragmented than ever.
SINGAPORE SEEKS HEDGEHOG DEFENSE APPARATUS
Singapore is trying to build up an effective de-
fense organization in anticipation of the British
withdrawal in late 1971.
PHILIPPINES IN FINANCIAL STRAITS
The government is seeking foreign assistance and
initiating a few minor remedial measures in an
attempt to paper over a deepening foreign-exchange
crisis.
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Page
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Europe
THE WEEK IN PERSPECTIVE
SOVIET THESES FOR LENIN'S CENTENNIAL
The Soviet Communist Party has published a massive
statement on the "true" Soviet path to Communism
and has criticized the "incorrect" policies of
other Communist parties in an attempt to reassert
its claim to leadership of the Communist movement.
FINNISH COMMUNIST PARTY SPLIT UNRESOLVED
The conservative-liberal division may result in
party losses in the March parliamentary elections.
OPTIMISM PREVAILS IN EUROPEAN COMMUNITIES
Agreement on European Communities financing arrange-
ments has encouraged EC members as they face addi-
tional difficult decisions.
UN TECHNICAL ASSISTANCE UNDER REVIEW
A substantial alteration of the UN's technical
assistance effort may result from the Jackson
Report on the subject.
Middle East - Africa
UNCODED
SEC R F;'I .
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ARAB SUMMIT PROVES UNFRUITFUL
The conference in Rabat exacerbated differences
between rival Arab regimes. The mini-summit held
by Egypt, Libya, and Sudan this past week follow-
ing the Rabat meeting helped slightly to restore
damaged images and to assuage wounded egos.
INDIA'S RIVAL CONGRESS PARTIES HOLD PLENARIES
Both espouse similar socialist programs, but
Prime Minister Gandhi's party had more trouble
keeping young radicals in line than did her rivals.
Western Hemisphere
VENEZUELA-GUYANA BORDER DISPUTE CONTINUES
The Venezuela-Guyana Mixed Border Commission is due
to expire in February 1970, and no solution to the
border problem is in sight.
JUSTICE IN PERU TO BE "MORALIZED"
The last vestiges of constitutional government
have been erased with the sweeping reorganiza-
tion of the judiciary and the abolition of the
popular election of municipal officials.
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Further clues to the power relationships among North Vietnam's lead-
ers cropped up in late December. On the occasion of three important
anniversaries, most of the hierarchy turned out, with the notable exception
of party first secretary Le Duan, who nominally heads the list of Ho Chi
Minh's successors. Although Le Duan may be active behind the scenes,
available evidence suggests his actual power is less than his top ranking
implies.
On the political scene in South Vietnam, President Thieu is keeping up
the pressure on the Lower House to oust three allegedly pro-Communist
deputies, and the government reportedly is encouraging demonstrations if
the House fails to act. Thieu also has tightened up on the press by suspend-
ing three Saigon dailies that have been critical of his policies.
Only light military activity took place in South Vietnam between the
holiday cease-fire periods, with no US fatalities reported but over 100 enemy
troops killed. Military activity in Laos also was fairly light, especially in the
north. In southern Laos, recent government gains are likely to blunt a
Communist threat against population centers near the Mekong Valley.
The Thai Government announced within the past few days that it had
opened discussions with Saigon on the timing of the withdrawal of Thai
troops from South Vietnam. In keeping the troop issue alive, Bangkok is
more interested in reaffirming the temporary nature of the Thai presence in
Vietnam and in appearing to stay in step with allied policies than in initiating
any immediate withdrawal.
The Republic of Singapore, worried that the British withdrawal in late
1971 will leave it defenseless, is actively building a strong "hedgehog"
defense that would keep the small island from being gobbled up by its larger
neighbors or other possible aggressors. The government is concentrating on
strengthening the army, buying new arms, and seeking military advisers.
Japan's opposition parties are more fragmented than ever following the
sweeping election victory of Prime Minister Sato's conservative party. The
primary losers were the Socialists, who gave up many seats also to the
fast-rising Komeito, the political arm of a powerful Buddhist organization,
and to the Communist Party.
Peking has put forward a new "model" for emulation in its sputtering
attempt to rebuild the shattered Chinese Communist Party. The rebuilding
process will not be accomplished easily, however, and this new statement
still leaves the picture clouded.
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Page 1 WEEKLY SUMMARY
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-SECRliT
VIETNAM
Leadership Turnout: Where's
Le Duan?
Most of North Vietnam's top
leadership showed up publicly in
late December for the celebration
of three important Communist an-
niversaries. Six of the nine sur-
viving members of the North Viet-
namese party politburo made at
least one appearance. Two others
have been out of the country. The
most notable absentee was party
first secretary Le Duan, who, de-
spite his nominal ranking as the
top party official among Ho Chi
Minh's successors, has not played
a significant public role since
Ho's funeral last September.
National Assembly chairman
Truong Chinh, Premier Pham Van
Dong, and Defense Minister Vo Ngu-
yen Giap all performed in their
usual prominent roles. Giap re-
ceived the lion's share of at-
tention during the army's 25th
anniversary celebrations, produc-
ing several major statements for
the occasion.
Truong Chinh, who ranks
just after Le Duan in the cur-
rent party line-up, which was es-
tablished at the last party con-
gress in 1960, has been by far
the regime's most prominent per-
sonality in terms of public ex-
posure and pronouncements since
Ho Chi Minh's death. In marked
contrast, Le Duan has gone vir-
tually unreported in North Viet-
nam's press and radio, where his
activities have been noted only
twice in the past three months.
Le Duan may be preoccupied with
behind-the-scenes party chores,
but the available evidence sug-
gests that he does not command
the power in the post-Ho regime
that would normally be conferred
on him by his ranking in the hier-
archy.
Better clues to the shape of
the leadership may be forthcoming
in the near future. The 40th an-
niversary of the North Vietnamese
party takes place on 3 February
and the regime has indicated that
it intends to mark the occasion
in a big way. A prominent role
for Le Duan would seem to be man-
datory if Hanoi wants to maintain
a facade of collective leader-
ship with the same figures in
the same jobs.
Cease-fire Periods
in South Vietnam
Communist military activity
between the holiday cease-fire
periods was generally light. Aside
from several small-unit attacks
and scattered rocket and mortar
shellings, most of the fighting
was the result of allied initia-
tive. The heaviest fighting
erupted in northern III Corps
and in several delta provinces.
The Communists were charged
with some 115 violations of the
24-hour Christmas cease-fire pe-
riod observed by the allied
forces, a slightly lower number
than during last year's standdown.
1"CR FIT
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In terms of casualties, no US
fatalities were reported, and
only two Americans were wounded.
South Vietnamese forces took
heavier losses than in past years
with 19 reported killed and an-
other 62 wounded. Known Commu-
nist losses were roughly three
times higher than in 196$--more
than 100 enemy troops were re-
ported killed.
President Thieu is maintain-
ing pressure on the Lower House
to oust three allegedly pro-Com-
munist deputies, but he appar-
ently is backtracking somewhat
in public for the sake of appear-
ances. There have been follow-
up demonstrations in some prov-
inces since the 20 December dem-
onstration in Saigon during which
protesters demanding action
against the three legislators
Page 3
Meanwhile, the government
is tightening its control over
the press. The suspension of
three Saigon daily newspapers
in recent days appears to mark
a reversion to a stiffer press
policy; only a few papers had
been suspended since the instal-
lation of a new information min-
ister in September. One of the
suspended papers was published
by the An Quang Buddhists and
the other two by members of the
Lower House--a factor that may
further inflame executive-legis-
lative relations. The new press
law passed by the Assembly ear-
lier this month forbids the
closure of newspapers without
court action, but Thieu promul-
gated the law only after the
three papers were suspended-F 25X1
SECREIT
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PEKING CONTINUES ATTEMPTS AT PARTY BUILDING
The heavy propaganda play
given the formation of several
local party branches in recent
weeks suggests that Peking is
trying to step up the rebuilding
of the shattered Chinese Commu-
nist Party apparatus. Since the
ninth party congress last April
the process has been seriously
hindered by the regime's failure
to resolve several key problems.
In a widely publicized domestic
radiobroadcast of 15 December,
however, the party committee in
a printing plant in Peking was
put forward as an example for na-
tional emulation.
A Chinese official recently
emphasized the importance of the
broadcast by describing it as "an
authoritative statement on party
reorganization."
The announcement concerning
the Peking printing plant pro-
vides an authoritative statement
on the delicate problem of how
authority is to be divided between
the new party organs and the
established revolutionary com-
mittees--the governing bodies
that were formed at most local
levels during the Cultural Revo-
lution. The broadcast stressed
that revolutionary committees
must submit to the leadership of
the new party committee. The Chi-
nese official characterized this
as a beginning that would slowly
spread.
on the crucial question of whol
will run the new party committees,
the broadcast stipulated that the
majority of the revolutionary com-
Page 4
mittee members are also members
of the party committee, and that
the party committee will not es-
tablish separate administrative
organs. If the party is esta~-
lished without its own command
control apparatus, however, it
would be a party in name only,
bearing little resemblance to
traditional Communist party struc-
tures. At this stage it appears
that the men who have been run-
ning China's basic-level govern-
ing bodies for the past three
years may for the most part, Sim-
ply be redesignated as leaders
of the new party committees and
continue to operate largely
through their established cha4.ns
of command. Because the military
controls the revolutionary com-
mittees in the majority of lo-
calities, it can be expected to
continue to exert a dominant in-
fluence.
Regarding the difficult prob-
lem of staffing the party, the
Peking broadcast singled out the
important role to be played by
former party officials. It
pointed out, for example, that
the army blocked attempts to ex-
pel some veteran cadres--who pre-
sumably were criticized during
the Cultural Revolution--from the
party and even maintained some in
positions of leadership. The pre-
cise role to be played by veteran
cadres has been a major stumbling
block in the party rebuilding
process, and the political reha-
bilitation of former local party
leaders has been hotly contested
in many areas by erstwhile Red
Guard factionalists. The latter
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have been seeking places in the
party on the grounds that they
represent the "new blood" that Mao
Tse-tung had said must be infused
into the party after the Cultural
Revolution.
The broadcast of 15 December
was apparently intended to pre-
sent an authoritative picture of
what Peking wants the party to
be, but it is at best a shaky
compromise that falls far short
of creating an effective appara-
tus. Moreover, the experience
of the last few years suggests
that the party-building process
will continue to be difficult and
uneven. The need for competent
local leadership is still criti-
cal as serious personnel problems
continue to beset the revolution-
ary committees that are supposed
to provide the core of leadership
for the new party machinery. The
number of propaganda broadcasts
scoring new cadres for ineffi-
ciency and factional activities
and o:Ld cadres for footdragging
and apathy testifies to Peking's
frustr=ation over the fact that
the revolutionary committees them-
selves are far from perfectly
funct:i.onin or ans of government.
JAPANESE GIVE SATO RINGING ENDORSEMENT
The sweeping victory scored
by the ruling conservatives in
the lower-house elections on 27
December has left Japan's politi-
cal opposition more fragmented
than ever. Prime Minister Sato
and his aides are claiming pub-
licly that their party's unex-
pectedly successful showing repre-
sents a strong endorsement of the
recent Okinawa settlement and a
clear mandate for continuing Ja-
pan's close defense relationship
with the US.
Sato's hand within the party
will be strengthened somewhat by
the ten seats gained by his fac-
tion. A similar gain was also
made by the forces of former
transport minister Nakasone, the
rising young leader of the party's
"new right." Nakasone, an advo-
cate of a more "independent" de-
fense posture for Japan and a pos-
sible future contender for lead-
ership of the conservative party,
now will have to be involved more
directly in party decisions.
The conservative gains came
largely at the expense of the Ja-
pan Socialists, the faltering ma-
jor opposition party. The Social-
ist losses resulted primarily from
the party's unbending preoccupa-
tion with unpopular ideological
issues, bitter factional infight-
ing, and overreliance on wanin
labor-union support.
SECRET
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514 ll}i:"[
The conservatives' actual
share of the total vote decli.neci
slightly, but at a rate consider-
ably less than in the last two
lower-house elections. The con-
servatives benefited from voter
apathy, particularly among the
younger, urban population that
traditionally has given strong
support to the left. This ad-
vantage was reinforced by the
electoral districting system
which gives disproportionate
weight to the votes of proconserv-
ative rural areas. This weightec
rural vote is responsible for the
conservatives' taking almost 60
percent of the seats with only
48 percent of the vote.
Democratic Socialist Party 7.4%
30 Seats
Democratic Socialist Party 7.7%
31 Seats
S I';(;1?', F,
The Clean Government Party
(Komeito) and the Communists also
racked up impressive gains at the
r>xpense of the Socialists. The
Kome__to, which apparently at-
tracted significant support from
beyond its own ranks, moved ahead
of the Democratic Socialists and
now has the third larqest repre-
sentation in the Diet. The Kome-
ito has been very effective in
fashioning its policies to appeal
to the broadest possible base,
particularly on pragmatic local
issues. The Communists made, their
best sho.wincc in recent years, al-
most tripling the number of seats
they held in. the lower house.
The Democratic Socialists,
who picked up only one seat, re-
nnard their performance as a "de-
Fea_" because of their failure
to profit from the debacle of the
.japan Socialist Party.
The conservatives benefited
irorn the inability of the two So-
cialist parties, which were the
major opposition elements going
into the election, to take full
advantage of popular concern over
pragmatic domestic issues such as
i. i s i_ng prices, inadequate housing,
and student unrest.
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SINGAPORE SEEKS HEDGEHOG DEFENSE APPARATUS
Singapore, long dependent on
Britain for security, is trying
to build up an effective defense
organization in anticipation of
the British withdrawal in late
1971. The government has been
working toward establishing a
small but tough and well-trained
army since the dissolution of the
merger with Malaysia in 1965, but
that process is still far from
complete.
Singapore hopes to achieve
what it has termed a "poison
shrimp" position--a security
structure that would be suffi-
ciently potent to deter would-be
aggressors but would be too weak
in itself to attempt offensive
action. Current plans envisage
boosting the present standing
army of roughly 7,000 men to
about 8,800 by the end of 1970--
largely by national conscription.
This force will be backed up by
a People's Defense Force, similar
to a national guard, of around
1,700.
At the present time, the only
major armaments that Singapore
has are 40 to 50 French tanks
Its air
and sea power are even more lim-
ited, and the island state will
remain dependent on Commonwealth
assistance in these spheres for
some time. In addition, the
army is dependent on outside
sources not only for equi ment
but also for training.
Singapore's leaders are ap-
prehensive about the state's fu-
ture security. They see it en-
dangered by a potential squeeze
play by Indonesia and Malaysia,
they worry about the effects of
a US pull-out from Vietnam, and
they distrust the sincerity of
the participants in the five
power defense arrangement in-
volving Singapore, Malaysia, the
UK, Australia, and New Zealand.
In addition, having witnessed
the racial riots in Malaysia after
the elections there last May, the
government is even more than
usually concerned that further
turmoil there might spill over
into Singapore itself.
Singapore's efficient and
often ruthless police force di-
rected by the authoritarian Prime
Minister Lee should have no trou-
ble taking care of internal dis-
turbances. Singapore itself has
demonstrated no aggressive ambi-
tions against other countries,
but authorities believe that their
strategy of a strong defense is
essential and are expected to
continue seeking additional arms
and advisers for the security
forces.
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PHILIPPINES IN FINANCIAL STRAITS
President Marcos, confronted
with a deepening foreign-exchange
crisis, is seeking massive foreign
funds to bail Manila out, and is
initiating some minor corrective
measures.
The Philippine balance-of-
payments situation has deteriorated
over the past three years as a re-
sult of soaring imports and stag-
nating exports. This year a
drought further aggravated matters
by reducing agricultural exports.
The growing trade deficits have
been financed by short-term borrow-
ing, mainly from US banks, and by
drawing down already low foreign-
exchange reserves. Unable to make
good on its short-term obligations
in September, Manila postponed re-
payment until January 1970, and
conditions have continued to worsen.
Many Philippine plants, lacking the
foreign exchange to buy imported
raw materials, indicate they may
have to cut back production. In
early December, moreover, Japan
decided against extending new export
credits.
Manila's initial reaction to
its problems has been to seek long-
term foreign loans to replace short-
term obligations. US banks have
been requested to stretch short-term
debts to five years and Washington
has been asked to make an advance
purchase of Philippine pesos needed
for US expenditures in the Philip-
pines over the next year.
Marcos announced in a tele-
vision talk on 20 December that
stabilization loans and trade
credits had been negotiated from
US, European, and Japanese sources.
These, however, presumably will be
contingent on arrangements for a
drawing from the International
Monetary Fund (IMF)--a subject that
Marcos glossed over during his TV
talk. Marcos and his advisers
hitherto have been loath to seek
IMF guidance and assistance for
fear that suggested measures would
be politically unacceptable.
Manila's inability to obtain
assistance on the scale sought,
particularly from the US, however,
may be softening its attitude to-
ward instituting remedial measures
and accepting IMF guidelines, Re-
strictions on foreign remittances,
government purchases, and stcvck-
market transactions--also announced
on 20 December--are among stops the
IMF almost certainly would require.
Foreign governments have in-
dicated to Manila that large-scale
loans would only be a temporary
palliative unless the Philippines
tackles its fundamental problems
I simultaneously. The Marcos
government, however, seems unable
to curb the manifestations of
I intense nationalism that have
brought about an unfavorable in-
vestment climate for foreign cap-
ital. Moreover, pervasive cor-
ruption permits considerable
illegal foreign-exchange trans-
actions and smuggling.
With re-election behind him,
Marcos may believe he can afford
to attempt more rigorous steps.
Should he persist, however, he will
sooner or later come up against the
oligarchy that controls much of the
economy and to which he is polit- 25X1
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The Soviets are girding for new rounds of talks with both China and the
West. First Deputy Foreign Minister Kuznetsov will return to Peking shortly
to resume the border talks, which apparently have progressed little beyond a
firm spelling out of basic positions. The next round may be a crucial one as
Kuznetsov undoubtedly will try to get things off dead center after consulta-
tions in Moscow. One Soviet official has claimed that the two sides have at
least agreed "in principle" to restore ambassadorial relations.
Meanwhile, in addition to starting arms limitation talks in April, the US
and the USSR will open discussions in Moscow on 7-8 January looking
toward staging a law-of-the-sea conference. The Soviets are also willing to
resume the disarmament conference in Geneva in February.
West German Chancellor Brandt this week publicly confirmed that
agreement had been reached with Poland on the opening of political talks-
probably at the undersecretary level-during the second half of January.
Meanwhile, in the face of East Germany's uncompromising approach to
possible all-German negotiations, pessimism is growing in West German
official circles and in the press regarding the usefulness of such talks. Brandt,
nevertheless, takes the view that the hard-line East German treaty proposal is
only a "draft," and he is determined to make counterproposals. He will
make a careful exposition of Bonn's position on this question in his state-of-
the-nation address on 14 January.
Belgrade expects to announce the appointment of an ambassador to
Peking soon. It also suspects that Moscow is dragging its feet on the 1970
trade talks with Yugoslavia for political reasons. To push his pet project of a
nonaligned summit meeting, Tito is planning a month's visit to Africa
starting in late January.
This week's change in the membership of the UN Security Council is
not expected to have any substantial effect on the voting line-up on issues of
importance to the US. Countries friendly to Taiwan have made contin enc
plans to meet any challenge to Taiwan's right to a council seat.
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SOVIET THESES FOR LENIN'S CENTENNIAL
The Soviet Communist Party's
Theses for the centenary of
Lenin's birth published last
week are intended to reassert
the CPSU's claim to leadership
of the world Communist movement.
Like the 1967 Theses for the
50th anniversary of the Soviet
Union, the document looks back-
ward rather than to the future,
and like those Theses, it will
serve as a framework for ortho-
doxy in the months of preparation
for the celebration next April.
The Lenin Theses forcefully
emphasize the "correctness" of
all major Soviet policies since
1917 and condemn national and re-
gional adaptations as inevitably
leading to the rewriting of the
basic principles of Communism.
Except for brief and perfunctory
jabs at "US imperialism" and "re-
vanchist forces" in West Germany,
the Theses criticize developments
or policies that Moscow dislikes
in other countries and parties
without specifically identifying
the culprits.
In an obvious reference to
the Czechoslovak reforms of 1968,
the Theses warn that any attempt
to weaken the dominant role of
the Communist Party opens the way
to the restoration of capitalism.
Workers' councils--presumably
Yugoslavia's--are described as
having "nothing in common with
scientific socialism." Stric-
tures against "reactionary-uto-
pian and military barrackroom so-
cialism" denigrate Maoist poli-
cies while avoiding mention of
China and staying within the
bounds of the current standdown
in Soviet polemics with China.
The Theses make no specific
reference to the arguments used
in the "Brezhnev doctrine" to
justify the invasion of Czecho-
slovakia. Instead, the anony-
mous authors revived a formula-
tion used in 1960 by the polit-
buro's senior ideologist, Mikhail
Suslov, on the emergence of the
"dictatorship of the proletariat"
as an "international force."
This formulation could in the
future be developed as doctrinal
justification for similar inter-
vention. On the other hand, the
benefits to be derived from the
"political and economic cohesion"
of Communist countries are heavily
emphasized.
In a passage directed as
much at domestic critics as at
restive East and West European
Communists, the Theses warn that
"so-called liberalized socialism"
endangers the keystone of the
"true" Communist system--cen-
tralized planning and management
of the economy--and threatens
to substitute a market-oriented
economy and economic rivalry.
Yugoslavia as well as other
East Europeans such as the Hun-
garians are likely to feel threat-
ened by this message.
Other Soviet domestic con-
cerns including the scientific-
technological revolution and the
contribution of the intelligent-
sia are referred to in vaguely
optimistic tones but without clues
as to how they are to be treated
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in the future. Soviet agriculture
is described as already receiving
everything necessary for its devel-
opment and--in a now-standard formu-
lation--the document notes that So-
viet economic achievements would
have been greater but for the fact
that "the state is compelled to al-
locate great resources for defense."
In an unusually frank reference to
a sensitive issue, the Theses warn
against any attempt to use criticism
of either the "personality cult"
(Stalin) or "subjectivism" (Khrushchc25X1
to revise the principles of Marxism-
Leninism. Nothing is to be allowed
to mar the April celebration.
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FINNISH COMMUNIST PARTY SPLIT UNRESOLVED
As 1970 begins, the conserv-
ative-liberal division in Finnish
Communist ranks shows little like-
lihood of being mended and may re-
sult in losses for the party in the
March parliamentary elections.
Alarmed at the possibility of
a breakup of one of the largest
West European Communist parties and
the only one to sit in a government,
the Soviet Communist Party has
pressed the liberal leadership to
compromise with the conservative
minority, if only to remove the
squabble from public view.
Repeated applications of So-
viet pressure, however, have had
only temporary effect. The liber-
als have bit by bit given way to
conservative demands, but with each
victory the conservatives have
upped their ante. Thus, in the
late fall the conservatives threat-
ened to run their own slate of can-
didates in the March parliamentary
elections in competition with the
party's slate, but were bought off
with the promise that conservative
candidates would be included on the
official lists. Yet local conserv-
ative organizations have stubbornly
refused to accept the compromise
and are going ahead with their orig-
inal plans for separate slates.
After some hesitation, party
chairman Saarinen attempted to
conciliate the conservatives with
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a series of speeches attacking var-
ious government compromises that
had been painfully negotiated with
the social democrats. He even
threatened to pull out of the gov-
ernment if Communist demands were
not met, but he was persuaded by
the Soviets to retreat from this
position. The conservatives, mean-
while, have not only maintained
their attacks on issues of domestic
concern, such as economic stabil-
ization measures and trade-union
reunification, but have also de-
nounced the proposed Nordic Eco-
nomic Union. They have also called
for a reversal of the party's ear-
lier condemnation of the invasion
of Czechoslovakia, thus placing
themselves "to the left of the
CPSU," according to one Soviet me-
diator.
The party's liberal rank-and-
file has bitterly criticized the
leadership for reversing its de-
mand that the conservative minor-
ity close down its newspaper. The
liberals have also been critical
of the leadership's termination of
attacks on the conservative organ-
izations paralleling those of the
party at the national, district,
and local levels and among women,
youth, and labor.
Recent public opinion polls
have shown that the split in the
Finnish Communist Party has led to
a considerable loss in voter sup-
port since the 1966 parliamentary
elections. Should the dispute con-
tinue, the party's popularity will
sink even below the low-water mark
set in the 1968 local elections,,
when, in the wake of the invasion
of Czechoslovakia, many Finnish
Communists either defected to the
social democrats or stayed home.
OPTIMISM PREVAILS IN EUROPEAN COMMUNITIES
The complex agreement reached
last week on European Communities
(EC) financing arrangements and the
manner in which it was concluded
have created an atmosphere of re-
newed confidence in the EC. If rat-
ified by the six national parlia-
ments, the agreement will implement
a key article of the Rome treaties
and will settle the issue that led
to the French walkout four years
ago. The accord will also now.per-
mit the members to take up the crit-
ical problems of surplus agricul-
tural production, structural reform
of agriculture, and the question
of British entry.
Under the agreed plan, the EC
would be financed between 1971 and
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1975 with increasing proportions
of receipts from custom duties,
in addition to the agricultural.
levies and member-state contribu-
tions. In 1975, all such duties
and levies and a portion of the
tax on value added in each member
country would constitute the EC's
own sources of revenue. In the
transition period 1971-1978, the
agreement would prevent wide fluc-
tuations in the proportion con-
tributed by any member.
In an important step for the
future development of EC institu-
tions, German and Dutch pressure
successfully overcame French re-
sistance to strengthening the
budgetary powers of the European
Parliament. According to the
agreement, beginning in 1975 the
parliament will be able, in de-
termining the next year's budget,
to overrule the member governments
as represented in the EC Council
with a three fifths majority vote.
The less contentious question of
the parliament's budgetary role
in the period 1971-1974 was not
settled but will be discussed in
January.
Now that the EC Council has
agreed on sources of financing
and on the proportion each mem-
ber will be expected to pay, the
members must decide how much they
are willing to devote to agricul-
ture. This will be determined
by the future price-support levels
they set, by the production re-
straints they may impose, and by
the structural reform program
they adopt. All of these topics
are highly controversial, and it
is conceivable that debate on them
could undermine the financing
agreement unless the current
spirit of compromise continues.
Because the six national
parliaments must still approve
the finance regulations, it will
be some time before the package
is wrapped up. The Germans have
indicated that parliamentary ap-
proval depends on a successful
resolution of the surplus prob-
lem. At least some of the par-
liaments may postpone action pend-
ing ratification by the French Na-
tional Assembly, where Gaullist
forces might object to increased
powers for the European Parlia-
ment.
Official British reaction
to the financing agreement is not
yet known, but the long transi-
tion period and the limitation
on the proportion contributed by
any member would probably help
the UK adjust to EC membership.
The accord satisfies the only
condition that France insisted
upon before the Six could begin
work on a common position for
negotiating with the UK. The
next: test of the "spirit of The
Hague" will come when the minis-
ters attempt to face the dilemma
of agricultural surpluses--a prob-
lem that bears heavily on the cost
to the UK of EC membership as well
as on the future of the common
agricultural policy.
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UN TECHNICAL ASSISTANCE UNDER REVIEW
The Jackson Report, the first
in-depth appraisal of the UN tech-
nical assistance effort, has cre-
ated a stir in UN circles since its
submission on 1 December. Its con-
clusions--many of them critical--
may lead to substantial changes in
both the size and administration of
the UN's aid program.
Commissioned by the 37-nation
governing council of the UN Devel-
opment Program (UNDP), the study
was directed by Sir Robert Jackson
of Australia, a former UN under-
secretary and a principal archi-
tect of the UN Relief and Rehabil-
itation Program during the late
1940s. In his 600-page report,
Jackson claims that 20 percent of
the assistance projects undertaken
in the $200 million annual effort
are "deadwood," initiated in many
cases by the "salesmanship" of the
UN agencies responsible for their
management. More than 30 such UN
agencies utilize UNDP funds. The
primary dispensers are the Food
and Agricultural Organization, the
World Health Organization, the Ed-
ucational, Scientific, and Cultural
Organization, and the office of
Technical Cooperation.
Jackson recommends that respon-
sibility for the technical aid pro-
gram be vested in a single, power-
ful authority, probably the UNDP
itself. Since he considers that
UN agencies are frequently too slow
in responding to requests and in-
efficient in satisfying them, Jack-
son urges increased reliance on con-
tracting projects out to non-UN or-
ganizations. On the other hand,
Jackson argues that the outlay of
UNDP funds should be doubled with-
in five years because the need is
critical and the UN is tife "ideal
instrument to do the job." These
recommendations will be taken up
at the March meeting of the govern-
ing council.
Scandinavian representatives
at the UN have said that the Jack-
son Report will be a crucial ele-
ment in determining their govern-
ments' future commitments of for-
eign assistance through the UN sys-
tem. If the technical aid program
is not revamped, they would place
greater emphasis on bilateral as-
sistance and other available multi-
lateral channels. Japan also has
commented favorably on the report,
stating that its "most revolution-
ary" proposals should be "vigor-
ously pursued" to make the UNDP
more efficient.
The less-developed countries
have taken a cautious attitude to-
ward the Jackson Report. India ap-
parently fears that a further con-
centration of authority and respon-
sibility within the UNDP would in-
crease the influence of the major
donors. Another negative note is
the view of a number of Western
delegates to the UN who doubt that
the UNDP staff has the capability
to exercise the increased preroga-
tives the Jackson proposals would
confer on it.
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Israeli Prime Minister Golda Meir, in her Knesset speech on 29 Dece,n-
ber, paid lip service to continuing friendship with the US, but devoted most
of her rhetoric to repeating Tel Aviv's "categorical" rejection of US pro-
posals for an Israeli settlement with Egypt and Jordan. The Knesset
demonstrated Israeli unity by passing almost unanimously a parliamentary
resolution backing the prime minister's statements.
A high level of military action along the Jordanian and Egyptian
cease-fire lines has been maintained. Israel has continued to attack Arab and
fedayeen forces in Jordan in an effort to get Amman to curb fedayeen
shelling of Israeli villages in the Beit Shean valley. Israel also continued its air
attacks on Egyptian artillery and missile sites on the west bank of the Suez
Canal and carried out small-scale commando raids in the Gulf of Suez area.
In Pakistan, full political activity resumes on 1 January as the country
prepares for the election of a constituent assembly next October. President
Yahya Khan has canceled the ban on public gatherings and has issued an
order outlining rules of conduct for political activity. Security conditions are
shaky, particularly in East Pakistan, and renewed outbreaks of violence may
occur as politicians begin campaigning.
Security forces in Addis Ababa have been able so far to prevent any
extension of the violence that resulted from the clash on Monday between
university students and troops. The government appears convinced that the
killing of the student-union president that touched off the clash was the
work of radicals hoping to provoke a new student-government crisis.
In the Nigerian civil war, the Biafrans have given some ground in the
face of the most sustained federal offensive in over a year. More heavy
fighting and further federal gains appear likely, but the Nigerians probably
will not be able to advance significantly toward Biafra's major population
centers or its two main airstrips.
Dahomey's three-week-old military triumvirate has attempted to give
itself a semblance of legality by adopting a "charter" and swearing to uphold
it. The charter confers presidential powers on the junta and promises early
elections.
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ARAB SUMMIT PROVES UNFRUITFUL
The recently concluded Arab i
summit conference in Rabat served
only to exacerbate differences
between rival Arab regimes. In-
dicative of the disarray at the
conference was the fact that it
ended without any resolutions or
a final communique; Syria, Iraq,
and Southern Yemen boycotted the
final session. Other sessions
were highlighted by bitter per-
sonal attacks on the leaders of
the conservative Arab countries.
The summit was doomed to
failure when Saudi Arabia, Kuwait,
Morocco, and Algeria refused to
respond to a call for greatly
increased military and financial
support for Egypt, Jordan, and
Syria. The reluctant states
begged off, claiming either that
they were contributing all they
could for the present or that
they would contribute more only
if a detailed plan for an all-
out war against Israel were pre-
pared.
The Palestinians appear to
have benefited most from the con-
ference. Arafat, the leader of
the Palestine Liberation Organi-
zation (PLO), was treated as an
equal by the Arab chiefs of state,
and deference was shown to him by
all.
Egypt's Nasir appears to
have been the principal loser.
As the main force behind the con-
vening of the conference, Nasir
had hoped the summit would in-,
crease his financial subsidy and
confirm his leadership of the
Arab world, thus enhancing his
ability to manipulate both radi-
cal and moderate Arab elements.
His hopes were dashed by most
states at the conference. Nasr,
after an initial public attack on
his opponents, has decided to play
down the differences that arose
at the sessions. He has since
stated that despite the "differ-
ences and negative aspects" of
the summit, there were some pot-
itive accomplishments.
The mini-summit held by Egypt,
Libya, and Sudan this past week
following the Rabat meeting helped
slightly to refurbish images and
to assuage wounded egos. Despite
emotional public rallies and
speeches of Arab unity, however,
little headway was made on the
political unity schemes that Libya
and Sudan have been pushing. The
Egyptian public shows few signs
of being interested in union with
other Arab states. Within Libya
there are many who actively oppose
any increase in Egyptian influence
in Libyan affairs. Indeed, much
of the motivation behind the re-
25X1
cent abortive coup attempt in Libya
stemmed from a desire to put an
end to the influence Egyptians al-
rea have in the country. 25X1
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INDIA'S RIVAL CONGRESS PARTIES HOLD PLENARIES
India's two rival Congress
party organizations held separate
plenary sessions this month. Des-
pite strenuous efforts to smooth
all internal controversy in "unan-
imous" decision, both meetings
were troubled by the special prob-
lems to which each party is heir.
The smaller of the two and
generally considered more conserv-
ative, the Organization Congress
met in Gujarat State from 12 to
22 December. The conferees dem-
onstrated a high degree of unity
on only one subject--animosity
for Prime Minister Gandhi.
On the vital subject of eco-
nomic development and implementa-
tion of India's unique form of
socialism, however, the delegates
were less precise. Although the
Organization Congress leans
slightly more to the right than
Mrs. Gandhi's party, it embraces
a significant body of radical so-
cialist opinion. Because of some
of the finest minds and important
members of the party hold these
views, the conferees found it pru-
dent to come up with economic reso-
lutions that were vague on spe-
cifics and heavy on socialist rhet-
Congress has retained considerable
nationwide support, support based
as much on personal loyalty to
party leaders as on ideological
commitment. This support is not
likely to dissipate quickly, and
it is now apparent that the Or-
ganization Congress, presently
the largest of all opposition
parties in parliament, will be
a major factor in Indian poli-
tics for the foreseeable future.
The ruling Congress party,
which met on 26 December in
Bombay, displayed a higher de-
gree of disunity but managed to
avoid any open defections. In
keeping with the prime minister's
strategy to present her party as
the champion of the poor and the
young, Mrs. Gandhi's party en-
dorsed a slightly more specific
socialist program than her op-
ponents. She was careful, how-
ever, to come out strongly only
for those economic measures that
would not antagonize large vested-
interest groups and, like the
Organization Congress, she
avoided putting a timetable on
the more controversial proposals.
oric. These tactics angered the
"young Turks" in her party who
wanted more concrete and speedy
Attendance at the meeting action. Mrs. Gandhi also had
demonstrated that the Organization I to contend with a large number
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of office seekers and others who
expected rewards for their loy-
alty to her organization.
The two parties, having sur-
vived their "conventions" rela-
tively intact, will now focus
attention on the February budget
session of parliament. Mrs.
Gandhi's minority government will
again face crucial tests on sev-
eral issues in its continuing
effort to maintain the support
of the disparate opposition par-
ties that supported her when the
Congress party split.
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With the approach of the new year, the attention of several Latin
American countries was focused on coming elections.
In Chile, the Popular Unity Movement, the electoral front for six leftist
and Communist parties, seems to be seriously divided because of a conflict
over who should be its presidential candidate in the elections next Septem-
ber. Socialist Senator Salvador Allende, a three-time loser in previous presi-
dential races, reportedly has withdrawn as his party's candidate because of
opposition to him within the front. There are rumors that Rafael Gumucio, a
former member of President Frei's Christian Democratic Party, will be the
compromise candidate.
In the Dominican Republic, a high-ranking delegation from the major
opposition Dominican Revolutionary Party met with "elder statesman" Juan
Bosch in Paris this week to determine whether the party will contest the
presidential election scheduled for May. Influential party radicals have called
for violent struggle in lieu of electoral participation, and Bosch's "dictator-
ship with popular support" thesis generally endorses this view. Moderates
continue to urge participation, warning that the party will cease to exist as a
legal political entity if it adopts a revolutionary platform. Political activity
will continue at a slow pace until the delegation returns in mid-January, and
the party will probably postpone a final decision on participation until
President Balaguer announces whether he will seek re-election.
In Guatemala, the "state of precaution" instituted two weeks ago to
give security forces extraordinary power to deal with a wave of terrorism,
has been extended for another 15 days. There has been a sharp drop in
terrorist activity since the first decree was issued. The "state of precaution"
does not curtail political activity preparatory to the elections on 1 March,
however.
In Panama, General Torrijos continues to consolidate his power follow-
ing the abortive coup attempt in mid-December. Torrijos has made several
changes in the National Guard and diplomatic service. In the most significant
change, the former Chief of Intelligence of the National Guard has been
"exiled" to the Inter-American Defense Board :in Washington.
The running battle between church and state in Paraguay continues.
Four leading Christian Democratic politicians were exiled this week for
alleged subversive activity. Although some Catholic laymen and clergymen
openly espouse revolution
there does not appear to be any serious
threat to his 15-year-old regime. The President continues to have the backing
of the military and of the Colorado Party.
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GUYANA: n Venezueian Territorial Claim TRINIDAD
AND
TOBAGO
POPT-OF-SPAIN
Ciudad Bolivai
VENEZUELA
Escalera. Area claimed by
GEORGETOWN
Venezue'a
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VENEZUELA-GUYANA BORDER DISPUTE CONTINUES
With less than two months
remaining before the Venezuela-
Guyana Mixed Border Commission is
due to expire, no solution to the
long-standing border problem is
in sight. Venezuela's abrupt
breaking off of the most recent
commission meeting has added an
extra note of uncertainty.
The mixed commission was
established in 1966 just prior
to Guyana's independence. The
commission was to last for four
years, and if no agreement on
the border issue was reached by
February 1970, the two countries
would have three months to find
other solutions. Failing that,
the case would be referred to
the United Nations secretary
general by June 1970.
Although the commission has
met regularly, it has made no
substantial progress toward solv-
ing the border problem. Venezuela
has little hope that the United
Nations or any other international
body will hand down a decision
favorable to it, so it has tried
to buy time by urging the Guyanese
to agree to an extension of the
talks. The Guyanese have little
interest in extending the talks,
and this apparently was the rea-
son Venezuela abruptly broke off
the session last week. The next
and :Last scheduled meeting is to
be held on 15 February.
In the coming months Vene-
zuela can be expected to put ad-
ditional pressure on Guyana to
continue the talks. Such pres-
sure is likely to take the form
of diplomatic maneuvering, a
press campaign, and possibly even
some troop movements. The memory
of the Venezuelan-sponsored up-
rising in the southern Essequibo
area a year ago will give an edge
to the pressure. There is no in-
dication that Venezuela intends
to carry out overt or covert mili-
tary operations at this time, and
President Caldera appears to be
firmly opposed to the use of force.
Nevertheless, hawks in the govern-
ment are likely to point to mili-
tary action as the alternative in
view of Guyana's lack of interest
in continuing the commission.
The Guyanese believe that
it would be futile to extend the
mixed commission. They apparently
are convinced that Guyana would
receive a favorable decision
from any international body, such
as the International Court of
Justice, selected to adjudicate
the dispute. On the other hand,
Guyana would welcome Venezuela's 25X1
proposed participation in develop-
ing the area as long as the de-
velopment is multinational.
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JUSTICE IN PERU TO BE "MORALIZED"
The Peruvian military has
erased the last vestiges of
constitutional government with
a sweeping reorganization of the
judiciary. Last week the Velasco
government dismissed 12 of the
16 members of the Peruvian Su-
preme Court in order to "moralize
the country and re-establish re-
spect for the law and the reian
of justice."
When the military assumed
the executive and legislative
functions of the Peruvian Govern-
ment following the coup in October
1968, President Velasco announced
that the basic law of the land
would be the military's "Statutes
of the Revolution" and the oper-
able portions of the Constitu-
tion. The continued existence
of an independent judiciary,
which on occasion overturned
government actions on constitu-
tional grounds, was the clearest
demonstration that at least some
constitutional guarantees re-
mained in effect. This has now
been eliminated. The military
has assumed indirect control of
the judicial branch of the govern-
ment with the appointment of
Supreme Court justices who are
more amenable to the military
and who will be subject to re-
appointment every five years.
All other judges and attorneys
are now subject to ratification
in their posts under the reorgan-
ization plan.
The judicial "reform" has
not met with strong opposition
from any sector of society, but
has been criticized by opposition
newspapers. The move had been
expected since last spring, but
the government seemed to be hold-
ing off while it argued with the
US that the judiciary was inde-
pendent and that problems arising
from the expropriation of the
US-owned International Petroleum
Company (IPC) should be settled
in Peruvian courts. The Velas',co
government apparently has now
given up any real hope that this
strategy will succeed although;
it can be expected to continue
to use it to counter any new us
proposals.
In another move to consoli-
date its hold on power, the mili-
tary has formally abolished the
popular election of municipal
officials. On 15 December the
government issued a communique
appointing new mayors of municipal
districts to replace those elected
under the Belaunde regime. Con-
trary to expectations, the new ap-
pointees in most cases are civil-
ian rather than military of-
ficers. The government's prefer-
ence for civilians in filling the
I municipal posts could indicate
that it now is more willing to
appoint civilians to hi h-level
government positions.
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