WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A009000030001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 25
• Document Creation Date: December 21, 2016
• Document Release Date: May 15, 2008
• Sequence Number: 1
• Publication Date: August 13, 1971
• Content Type: SUMMARY

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Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
Secret
PETOON TO ARCHIVES & RECORDS CENTER
I tMEDIATEEY AFIER USE
JOB n.`. s~-- Sox ,.----
State Dept. review
completed
13 August 1971
No. 0383/71
Copy NO
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SJ UKt i
CONTENTS
(Information as of 1200 EDT, 12 August 1971)
Indochina
Vietnam: Campaigning in the Summer . . . . . . . . . . . . . . . . . . . 1
Laos: The Government Gains Ground Gradually . . . . . . . . . . . . . . . 3
Cambodia: Lon Nol Takes the Reins . . . . . . . . . . . . . . . . . . . . 3
Korea's Unification Issue . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Thailand Ponders China Question . . . . . . . . . . . . . . . . . . . . 5
Page
Eastern Europe: Tighter Soviet Restrictions on Foreign Policy . . . . . . . . . . 6
Yugoslavia: Tito Parries Soviet Probes . . . . . . . . . . . . . . . . . . . . 7
CEMA Inches Forward . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Sino-Soviet Trade Appears on the Rebound . . . . . . . . . . . . . . . . . . 9
UN Revamps Its Socioeconomic Sphere . 9
. ...............
Italy: Uovernment Pushes Housing and Tax Bills Through Senate . . . . . . . . 12
The Soviet-Indian Friendship Treaty . . . . . . . . . . . . . . . . . . . . 13
Sudan: Complete Break with Soviets Avoided. . . . . . . . . . . . . . . . . 14
Morocco: A New Look? . . . . . . . . . . . . . . . . . . . . . . . . . 15
Middle East Developments . . . . . . . . . . . . . . . . . . . . . . . . 16
Chilean Developments . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Dominican Republic: Still the Champ . . . . . . . . . . . . . . . . . . . 19
Panama: Church-State Relations . . . . . . . . . . . . . . . . . . . . . 20
Argentina: Antiterrorist Campaign . . . . . . . . . . . . . . . . . . . . . 20
NOTES: Iran; Cyprus; Trinidad-Tobago
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Indochina
Vietnam: Campaigning in the Summer
FAR EAST
than disrupt the elections, the Communists are
mainly trying to generate support for candidates
amenable to their interests. In Dalat city in the
central highlands, for example, Viet Cong cadre
have been told to campaign for the election of
"'progressive candidates," while in Saigon Viet
Cong leaders have sent letters to at least four
antigovernment candidates encouraging them to
adopt a "coalition and peace" slogan and to
"rally the masses" to demand peace and fair
I
After numerous delays, North Vietnamese
forces just south of the DMZ began a series of
coordinated shellings and limited ground attacks
late this week. Among the targets were the dis-
trict headquarters at Cam Lo, Fire Support Base
(FSB) Fuller, and other nearby South Vietnamese
positions in northern Quang Tri Province.
This new round of action probably repre-
sents another cycle of the enemy's "summer cam-
paign," which has experienced numerous dis-
ruptions and delays. Unseasonably heavy rains in
the DMZ-where the enemy threat is currently
the strongest-had stalled the planned attacks.
Enemy units in the central provinces and the
western highlands have been experiencing supply
shortages, while South Vietnamese operations and
monsoon rains elsewhere have forced the enemy
to lie low.
New Communist action in the densely popu-
lated coastal regions of the northern provinces is
likely to begin shortly. As in the past, however,
chronic problems could delay the enemy's time-
table in both areas.
There is mounting evidence of the Commu-
nists' interest and involvement in the Lower
House elections to be held on 29 August, al-
though it is questionable whether the / can exert
much influence. rather
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VL V1\L 1
Laos
0 Government-held location
0 Communist-held location
elections. Enemy cadre in the delta were recently
told that COSVN had changed its views on the
elections and now believes that Communist par-
ticipation would be more favorable in the long
run than disruptive tactics.
Nevertheless, the decision to politick for ac-
ceptable candidates may not exclude a measure of
armed harassment. A recent high-level directive
called for greater military activity prior to the
Lower House and presidential elections, but it
pointed out that military action would be halted
on election day to permit voters to get to the
polls and, hopefully, vote for VC-approved candi-
dates. In areas where the Communists have been
unable to make political inroads, however, the
emphasis on military action may be greater.
And Among the Legal Opposition
Internal disagreements in the An Quang
Buddhist organization could weaken its support
for Big Minh and the candidates the An Quang is
backing in the Lower House race. For some time
the An Quang hierarchy has been divided over the
wisdom of openly endorsing Big Minh. Thich
Thien Hoa, the rector of the An Quang Secular
Affairs Institute, is urging that the An Quang
unequivocally declare its support for Minh, a step
also urged by a number of the younger, more
activist bonzes. An Quang leader Thich Tri
Quang, however, wants An Quang support for
Minh to remain behind the scenes. Tri Quang and
others in the dominant Centralist leadership are
convinced that Minh will lose, and they are reluc-
tant to be so tied to his defeat as to limit options
for political manuevering after the election. Big
Minh's chances for at least a respectable showing
could suffer badly if the An Quang give him less
than all-out assistance.
The efforts of the An Quang to make a good
showing in the Lower House contest are also
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running into a few snags. The Saigon leadership
and local pagodas are apparently in disagreement
over the choice of candidates; An Quang leaders
in Quang Ngai, for example, are reportedly miffed
at having candidates thrust upon them without
their prior agreement. Although bonzes and lay-
men are earnestly campaigning for selected candi-
dates, any serious disunity could harm the pros-
pects of the An Quang candidates.
Laos: The Government Gains Ground Gradually
against General Vang Pao's forces. The govern-
ment's irregulars have been shelled, and patrolling
units have been engaged in some sharp skirmish-
ing on the northeastern sector of the Plaine and
to the southeast near Xieng Khouangville.
Souk Vongsak, the Pathet Lao envoy in
Vientiane, has returned to Communist headquar-
ters at Samneua for "consultations" after de-
livering a message in the Lao capital from Pathet
Lao leader Souphanouvong. The message repeats
the line that the Communists are determined to
solve the Laos problem peacefully, but vows that
they will continue fighting until government at-
tacks on the Plaine and in south Lao* are
smashed. In his departure statement, Souk singled
out the attacks on the Plaine as having "rendered
the situation more complicated and explosive,"
and tied his exit from Vientiane to Prime Mipister
Souvanna's lack of good will and to US "sab-
otage."
Government forces are slowly approaching
Paksong on the Bolovens Plateau despite some
strong enemy resistance. Aided by intensive artil-
lery bombardment and air strikes by Lao T-28s,
regular battalions on 8 August occupied Ban Phak
Kout on Route 23 and have moved on to within
four miles of their objective. Progress will prob-
ably continue to be arduous because the North
Vietnamese are building fortifications west of the
town. The three battalions of the NVA 9th Regi-
ment are defending Paksong.
North of the Bolovens, government forces
ranging around Saravane have discovered several
small rice and ammunition caches and have en-
gaged in skirmishes with small enemy units. In the
central panhandle, irregular forces have for the
moment desisted in their attempt to capture
Muong Phalane. Four of the battalions that had
been operating near the town are now sweeping
westward on the north side of Route 9 as they
return to their base in the Dong Hene area. In
north Laos, a three-battalion government force
has begun to move eastward along Route 7 to-
ward Muong Soui, the former neutralist headquar-
ters lost to the Communists last February. The
town is believed to be lightly defended by Lao
Communist units.
The Communists appear intent, however, on
defending the hills north and east of the Plaine
Prime Minister Souvanna Phouma and his
cabinet regard the new message as menacing in
tone and see nothing new in it. Souvanna, who
does not appear to attach great importance to
Souk's departure, gives the impression that he,
too, is prepared to await military developments
before trying again to talk about peace talks.
r
Cambodia: Lon Not Takes the Reins ,
Despite the fact that he has still not fully
recovered from his disabling stroke, Prime l1inis-
ter Lon Not continues to show signs thot he
intends to assume more of the burden of govern-
ing and play a more active political role.: And
whether intentional or not, some of the Cam-
bodian leader's actions seem to have had the side
effect of diluting some of Sirik Matak's authority
and political standing.
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Early in the month the prime minister made
a broadcast to the nation about the country's
economic problems, which he claimed were the
handiwork of "enemy agents." A few day's later,
after Sirik Matak's departure for the United
States, he chaired his first cabinet meeting in
many months. The fact that no one was named
temporarily to handle Matak's duties-aside from
his responsibilities as minister of defense-suggests
that Lon Nol plans to assume those chores
himself.
It is possible that the Prime Minister has
decided to reassert his power at this point to
blunt growing criticism in Phnom Penh of both
his own lack of leadership and of Sirik Matak's
performance. Matak has been the object of con-
siderable antigovernment carping lately, which
has been precipitated for the most part by wors-
ening economic conditions. His trip to the United
States may have an important bearing on his
immediate future. It could serve to boost his
political prestige. On the other hand, however, he
may be taken to task anew by certain of his
critics for failing to fulfill their unrealistic ex-
pectations of additional US aid.
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government control of the
countryside in two southeastern provinces is gen-
erally limited to areas adjacent to main lines of
communication. Although main roads and water-
ways in Prey Veng and Svay Rieng provinces are
open to regular traffic, FANK forces control only
small strips of land about one mile wide on either
side of the Mekong River and some two miles
wide along Routes 1 and 15. Cambodian peasants
are moving from Communist-held areas to resettle
in these narrow zones.
Korea's Unification Issue
Both Seoul and Pyongyang are seeking to
pre-empt the issue of Korean unification in an-
ticipation of the expected UN debate on Korea
this fall. Both sides are concerned that their re-
spective interests may in some way be sacrificed
by the recent movement in Sino-US relations. As
one senior South Korean Foreign Ministry official
recently put it, history has made all Koreans
particularly sensitive to our "fate being decided
by other countries."
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In the South, the government is attempting
to appear more flexible toward unification. Prime
Minister Kim Chong-pil told the National Assem-
bly on 7 August that he viewed a North-South
"dialogue" as "inevitable sooner or later." He
cautioned, however, against any hasty approach
toward the Communist countries during the cur-
rent thaw, adding that talks, when they do take
place, should not be construed as official recogni-
tion of Pyongyang. The foreign minister then
took a similar line before the assembly stating
that Seoul will demand that Pyongyang recognize
the "authority and competence of the UN" to
deal with the Korean problem as a condition for
taking part in the expected General Assembly
debate of the issue later this year. He added,
however, that South Korea "may make some con-
cessions if friendly nations so wish."
Seoul's intention is to give the appearance of
acting boldly while in fact moving with consider-
able caution. President Pak Chong-hui and his
more international-minded advisers are aware that
the time has come for the South to show greater
flexibility toward unification, but he is also con-
scious of the need to avoid alarming the many
South Koreans who oppose any form of com-
promise with the Communists. In his National
Day speech last year Pak called for a lifting of the
barriers that divide Korea and promised under
certain conditions to drop South Korea's opposi-
tion to North Korean participation in the annual
Thailand Ponders China Question
Developments in US-China relations have
accelerated a debate within the Thai Govern-
ment over the stance it should adopt toward
Peking. Foreign Minister Thanat Khoman, the
leading advocate of an accommodation with
Peking, sees his stand vindicated by recent US
moves. In the debate in government councils,
however, the caution of Prime Minister
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UN debate on Korea. His remarks, however, were
couched in terms that the North Koreans could
not be expected to accept.
This year Pyongyang is also attempting to
convey an appearance of greater flexibility and
reasonableness on the unification issue. At the
opening of the Supreme Peoples' Assembly in
April, the foreign minister called on South Korea
to accept the North's standard program for unifi-
cation. A key passage in his statement proposed
that representatives of all political parties, public
organizations, and individuals "of popular charac-
ter" on both sides meet at Panmunjom or in a
third country to negotiate the first steps toward
unification. Although the offer contained nothing
new, the language implied an immediacy that was
absent from earlier proposals.
In his welcoming address to visiting
Cambodian Prince Sihanouk on 6 August, Premier
Kim 11-song returned to the proposal made in
April; this time he specifically mentioned Pak's
Democratic-Republican Party as one of the
groups that should be included in any
North-South meetings. Implicit in Kim's offer,
however, was his long-standing condition that
actual unification will only be possible after
the South Koreans have driven out, the
Americans and gotten rid of the Pak govern-
Thanom and Deputy Prime Minister Praphat
has held sway. The upshot has been a decision
for a wait-and-see attitude, one that will take
greater cognizance of Thai security considera-
tions. Even Thanat admits that Thailand's
problem with Chinese-backed insurgency neces-
sitates a wary attitude toward Peking, and he
does not see diplomatic relations in the near
future.
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Thailand is reportedly considering absten-
tion on a UN vote on Peking's admission, al-
though the issue has not been resolved. Bang-
kok might see the chances increasing for bi-
lateral talks on Peking's backing of Thai in-
surgency if Communist China is seated in the
UN. But it is this insurgency that also could
deter the Thai from voting in Peking's favor.
In its search for a China policy tailored
to its national interests, Bangkok is concerned
about being out of step with its Asian
neighbors. It alone has given a clearly positive
response to Philippine President Marcos' call
last month for an Asian summit discussion of
the regional implications of US moves toward
China. The feasibility of such a meeting will
be considered by the delegations of the coun-
tries concerned at the UN General Assembly
next month.
The China debate within the Thai Govern-
ment is speculative, and Peking evidently has
not responded to various Thai overtures.
F
EUROPE
Eastern Europe: Tighter Soviet Restrictions on Foreign Policy
Reactions from some Eastern European
capitals suggest that Moscow's criticism of foreign
policy deviations at the Crimean summit last
week was harder and more sweeping than past
pronouncements.
The Soviet leaders apparently were espe-
cially firm with Hungarian party leader Kadar,
who rushed home after the meeting to call a rare
joint session of the party, government, and na-
tional front on 4 August. His early departure
from the Crimea and his private hearing with
Brezhnev and Podgorny just prior to the summit
suggest that the Kremlin was particularly anxious
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that Budapest purify its foreign policy orienta-
tion. The communique from the joint session of
Hungarian leaders did just that. It promised closer
service by Hungarian foreign policy to "the Soviet
alliance" and vigilance against imperialist splitting
tactics. The abjectness of Kadar's subservience to
this line is in marked contrast to his usual flexible
style, but it is the price he must pay to protect his
comparative independence in domestic affairs.
Earlier this year Kadar flirted with trouble
by tacitly urging a more forthcoming approach to
China.
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Kadar also
had been trying to improve his relationship with
Romania's Ceausescu despite the latter's disdain for
Moscow's foreign policy directives. The sharp So-
viet reaction to the Ceausescu visit to China and to
President Nixon's proposed China visit caught
Budapest decidedly out of phase with Kremlin
thinking. The Soviets have now put Kadar in tow
early in their campaign against Romania, instead of
risking a repetition of his stubborn moderation dur-
ing the Czechoslovak crisis in 1968.
Other Eastern European mavericks also are
feeling the heat. On 6 August, acting Yugoslav
Foreign Secretary Vratusa privately described the
atmospherics of the Crimean summit as having
"very ugly implications" and said it was time for
everyone to remain cool and "perhaps a little qui-
Yugoslavia: Tito Parries Soviet Probes
Reports of an autumn visit to Yugoslavia by
Soviet party leader Brezhnev surfaced this week
against a background of uneasiness in Belgrade over
Soviet attempts to tighten control over ruling Com-
munist parties in Europe. A steady erosion of good
will between the two countries has been evident in
recent months in occasional Yugoslav public pro-
tests and private Yugoslav complaints about Soviet
interference in Yugoslav affairs.
During the past week, the Yugoslav media
launched bitter attacks against the recent Warsaw
Pact maneuvers in Hungary and the upcoming pact
exercise in Bulgaria, characterizing them as a "gross
insult" to all Balkan countries. In return, Tito has
scheduled his own war games in late September to
test Yugoslavia's all-peoples defense system. The
scenario will be aimed clearly at repelling a Warsaw
Pact invasion of Yugoslavia.
Not publicized, but indicative of the poor
state of relations, is Yugoslavia's flat rejection of
Soviet requests for naval bases on the Adriatic and
increased overflight rights for UAR-bound aircraft.
Belgrade has further emphasized its independence
by establishing closer associations with China at a
time when Moscow is annoyed at the new warmth
in Chinese-Ron;ai. an relations and is preoccupied
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Elsewhere in Eastern Europe there are no visi-
ble signs of either the fevered Budapest reaction or
the tense watchfulness in Bucharest and Belgrade.
The regimes in Pankow, Warsaw, Prague, and Sofia
were not guilty of any serious deviations, but they
have received another object lesson that Moscow's
foreign policy guidelines are not to be
bridged.
with preventing any further Chinese ascendancy in
Communist Europe.
Yugoslavia's decentralized political and eco-
nomic system, which many of Moscow's Eastern
European allies find attractive, is another point of
friction. The Soviet leaders have tried to discredit
Tito's reforms and privately have rejoiced over
Yugoslavia's latest bouts with inflation and regional
squabbles over constitutional reform. Most, Yugo-
slavs believe the Soviets have contributed to these
difficulties by sending subversive Cominformist
agents into Yugoslavia. In addition, a high-level
Yugoslav official has told US Embassy officers that
the Soviets have conducted clandestine financial
operations to harm Belgrade's international credit
rating.
Under these circumstances negotiable topics
for a Brezhnev visit--said to be the subject of the
Soviet charge's call on Tito on 24 July-will be
sparse. Last week Tito gave a lengthy interview to
an Italian journalist that portrayed his attitude to-
ward Moscow in comparatively favorable terms.
The interview may signal that Tito is prepared to
listen to Brezhnev's case, but it did not yield on any
point that Tito believes would infringe on Yu o-
slavia's independence.
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CEMA Inches Forward
The "complex program to perfect coopera-
tion and develop economic integration," which
was unanimously adopted at the late July annual
session of CEMA and released this week, reflects
serious compromise, despite two years' study and
work on economic relations among the member
countries. Insofar as the 60,000-word program
falls short of the tightly centralized scheme orig-
inally advocated by the Soviets, the role of some
East European countries, particularly Romania,
becomes apparent. The document, however, also
points out the complicated nature of many of the
proposals by calling for implementation over a
15- to 20-year period and by failing to make
member participation mandatory in all features of
the program. Nevertheless, experience in recent
years appears to have driven home to the East
Europeans their economic interdependence and,
more importantly, their dependence on the
USSR. Such a realization may be compelling
them to get together in spite of their divisive
interests and some latent mutual antagonisms.
Concern over consumer welfare and Eastern
Europe's vital need for raw materials is spelled
out by the citation that plans now exist for settle-
ment of "the most important economic problems,
particularly those having to do with providing
fuels and raw materials... and satisfying popular
demands for industrial goods and foodstuffs." As
raw materials and foodstuff needs are in large part
met from the Russian storehouse and are supplied
under pricing or barter arrangements favorable to
Eastern Europe, they provide Moscow with some
leverage in urging more forward movement in
cooperative schemes. Furthermore, Eastern
Europe is aware that the possibility of satisfying
such needs from non-Communist sources is lim-
ited. Eastern European exports are not in great
demand in the West and Western financing bycredit
will play a less important role than in the 1960s.
Apprehension over the expansion of the Common
Market also contributes to the forces impelling
Eastern Europe to take another look at the pos-
sibilities in closer association among themselves.
Bilateral understandings, particularly those
hammered out with the USSR, are likely to con-
tinue to dominate relations among CEMA mem-
bers, but these may increasingly lead to CEMA-
wide efforts. Some progress toward multilateral
cooperation already has been made in the fields
of electronics, chemicals, and metallurgy, and
these industries are cited in the "complex pro-
gram" as areas for further cooperation. These
arrangements are specifically based on mutual
deliveries and production cooperation rather than
on grandiose over-all coordination schemes with
the USSR at the apex that characterized earlier
integration efforts. The USSR hopes to foster
more of this type of arrangement as well as the
incorporation of advanced Western technology,
some of which will be financed through the new
CEMA International Investment Bank. The initial
list of projects in the USSR and Eastern Europe
has not yet been announced, but the new CEMA
effort emphasizes the important role that directed
investment is to play.
The problem of price-setting and currency
convertibility remains and is recognized. The
present system of using world prices "stripped of
the harmful influence of transient factors of the
capitalist market" is to be continued, but prob-
ably with adjustments in favor of raw material
exports. Convertibility of currencies within the
CEMA trading area is to be worked out over the
next two years; its application is likely to be
restricted to trade in Commodities not in short
supply.
These problems, lack of discipline, and fears
by Romania and other East European countries
that their national interests will be sacrificed
resulted not only in the long period set for
implementation but also in the liberal sprinkling
of references to equality and sovereignty in the
document. Hence there probably will be no more
than an inching forward on cooperation at this
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Sino-Soviet Trade Appears on the Rebound
The relative easing of the intense hostility
created by the Cultural Revolution and border
fighting of the late 1960s has enabled Moscow
and Peking to move toward resuming some of the
economic contacts disrupted during that period.
The recent signing in Moscow of a one-year trade
pact follows up the trade agreement concluded
last November, the two countries' first formal
agreement since 1967, and is a further effort
toward normalization of commercial relations.
This builds on another step taken earlier this year
when Soviet ships began to call at Dairen to load
salt, the first time since August 1967, when a ship
was harassed and detained by Red Guards.
A Soviet deputy minister of foreign trade
has stated that Sino-Soviet trade this year is slated
to reach $130 to $150 million. This compares
with a meager $47 million recorded last year, the
low point in a constant decline from almost;$2.2
billion in 1959. Recent sales of Soviet aircraft to
China confirm an upward trend.
The extremely low levels of trade over the
past few years have been economically disadvan-
tageous to both countries. The Soviet Far East
has been deprived of goods that are conveniently
available across the border in China. For its part,
Peking has forgone expeditious import from the
USSR of some of its requirements for industrial
and transportation equipment, iron and steel
products, and forestry products. Nevertheless, as
long as both sides fail to resolve their fundamen-
tal differences and view each other as political
antagonists, trade is likely to remain far short of
the levels of the early 1960s.
UN Revamps Its Socioeconomic Sphere
The recently concluded meeting of the UN's
Economic and Social Council (ECOSOC) reached
agreement by a 17-7 vote on several measures
designed to upgrade substantially that institu-
tion's effectiveness in the international com-
munity. Backed strongly by the US, the measures
were adopted only after bitter debate, however,
and the minority-led by Yugoslavia and Brazil--
may attempt to unravel the "package" at the
upcoming session of the General Assembly.
Despite its legal status as one of the UN's
primary organs, the ECOSOC has languished for
years, providing only nominal direction to its
rapidly increasing number of subordinate agen-
cies. Particularly needed are firmer arrangements
for dealing with scientific and technological ques-
tions and for surveying areas in which the concept
of the Second UN Development Decade, the
1970s, can best be utilized. US initiatives in-
tended to achieve these ends were introduced
earlier this year and generally have received strong
Western support, although both the UK and
France abstained at the recent ECOSOC session.
A number of the less developed countries
(LDCs) supported the new arrangements in return
for agreement that the ECOSOC be enlarged from
27 to 54 members. Yugoslavia and Brazil, two of
the leaders in the LDC camp, opposed this com-
promise, arguing that LDCs' interests would be
better served in all-member UN institutions' such
as the General Assembly and the Conference on
Trade and Development (UNCTAD).
The USSR also voted against the decision in
the ECOSOC, because of its traditional distaste
for measures that tend to add muscle to UN aid
programs and thereby weaken Soviet bilateral in-
fluence. Moscow could kill the projected enlarge-
ment-amendment of the charter is required and
is subject to big-power veto-but it may be unwill-
ing to damage its credentials with the LDCs by
doing so.
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Italy: Government Pushes Housing and Tax Bills Through Senate
Recent Senate approval of bills on housing of centrist administrations without the Social-
and tax reform-measures that have been an ob-
ject of controversy in the governing center-left
coalition of Christian Democrats, Social Demo-
crats and Socialists-gives some respite to the
Colombo government. Although the coalition re-
mained basically intact on the vote, tensions re-
main acute, particularly between the two Socialist
parties.
The indication in local elections last June
that the electorate had moved right is having
continuing repercussions within the coalition on
local and regional matters. In a growing number
of instances, both the Christian Democrats and
the Social Democrats-apparently heeding the
trend toward conservatism in the electorate-have
been excluding the Socialists in the formation of
local coalition governments. In Genoa and the
province of Liguria, the resignation of Social
Democratic members of the center-left adminis-
trations may be a tactic to promote the formation
The housing and tax bills should pass the
Chamber of Deputies with relative ease in Octo-
ber. The housing bill provides for increased public
housing expenditures, the expropriation of some
private urban land, and aid to private builders. It
should stimulate the depressed construction
sector and improve the dismal housing of low-
wage southern Italian laborers who have flooded
northern industrial centers. The tax bill simplifies
the fiscal structure and collection procedures and
should cut down on evasion. A single progressive
tax will replace sixteen different taxes and sur-
charges on personal income and a standard tax on
company profits will replace all current corporate
levies. The tax reform will make fiscal policy
more effective by allowing the government to
forecast revenues more accurately and initiate
policy changes more rapidly.
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MIDDLE EAST-AFRICA
The Soviet-Indian Friendship Treaty
News of the signing of the Indo-Soviet
friendship treaty on 9 August dominated the
South Asian political scene this week. Pressure to
recognize the independent government of Bangla
Desh had been steadily building on India's Prime
Minister Gandhi, but both she and the Soviets
were mindful of the fact that precipitate recogni-
tion could spark a costly Indo-Pakistani war. On 8
August Soviet Foreign Minister Gromyko flew to
New Delhi, presumably to caution as well as to
consult with Mrs. Gandhi, and the treaty was
announced the following day.
In one stroke, Mrs. Gandhi's hawkish domes-
tic critics were temporarily upstaged, and the
Chinese, who the Indians feared would intervene
should hostilities break out between India and
Pakistan, were put on notice that New Delhi did
not stand alone. Recent developments in Sino-US
relations also probably intensified Indian desires
to reinforce ties with Moscow. Conversely, it is
not inconceivable that the treaty could lead the
Pakistanis to seek a similar confirmation of their
relations with the Chinese.
The treaty specified only that India and the
Soviets would "consult with a view toward taking
effective measures" in the face of aggression and
that they would suspend "any assistance" to a
third nation at war with one of the contracting
parties. Moscow's pledge merely to consult is a
reflection of its uncertainties about the outcome
of the present crisis. A principal aim of Gro-
myko's trip to New Delhi was to impress upon
the Indians Moscow's desire that India do nothing
that would provoke a war with Pakistan. As a
result of the treaty, however, the Indians may
believe that the Soviets are now so committed to
New Delhi that Moscow would have no alterna-
tive but to support India, no matter how a war
originated. The Indians probably cannot foresee
that Moscow would fail to come to their aid with
effective military assistance-albeit short of a
troop commitment-if the Chinese should inter-
vene in an Indo-Pakistani war. Moreover, the
Indians also assume that the Soviets would cut off
all assistance to Pakistan and protect Indian in-
terests at the UN. An Indian Governments pokes-
man has already told press representatives that, in
addition to the treaty, the USSR has offered
India more military hardware in case India be-
comes involved in a military conflict.
The treaty, despite the fact that it flies in
the face of India's traditional policy of nonalign-
ment, was enthusiastically received by the Indian
Parliament. Concluding the treaty has boosted
Mrs. Gandhi's stock as a statesman and bought
time for her. Should the situation in East Bengal
continue to deteriorate, however, the hawks may
well return to the attack, arguing that India, now
armed with the treaty, is in a particularly advanta-
geous position to seek a military solution in East
Pakistan. The treaty may have already encouraged
continued support of the East Pakistani guerrillas.
Thus if this latest manifestation of Soviet support
brings about more forward military action on
India's part, Moscow's efforts to restrain the
Indians and to avoid becoming over-involved
could backfire. In the present emotionally
charged and fast-changing situation, such a back-
lash may come sooner rather than later. The Pak-
istanis have brought Sheik Mujibur Rahman-the
charismatic East Bengali leader-to trial, add if he
is condemned to death Indian public opinion will
be further aroused.
The Soviets probably initially viewed the
treaty-under consideration for over two
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years-primarily as an anti-Chinese document.
Sino-Soviet relations reached their nadir in 1969,
and such a move then would have been consistent
with a number of other initiatives Moscow took
that year to shore up its position throughout
Asia.
The USSR's immediate aim, however, in sur-
facing the treaty in the present circumstances is
probably to forestall precipitate Indian action on
the East Pakistani question. Moscow still believes
that a war between India and Pakistan is not in
the USSR's or India's best interests.
The Soviets are probably pleased that pres-
ent events have enabled them to get the treaty
finally on record. Moscow has long feared a possi-
ble Sino-Indian rapprochement and is doubtless
aware that China's current policy of forward
diplomacy has been practiced on the Indians. As a
result of the treaty, the Soviets probably believe
they have gained much ground against China (and
also the US) and have taken a long step toward
solidifying their position in the whole region.
When news of the treaty reached West
Pakistan, Islamabad immediately invited
Gromyko to visit Pakistan on his return from
New Delhi-an invitation the Soviet foreign minis-
ter declined. The treaty and Gromyko's rejection,
however, does not necessarily mean that the
Soviets have written off the West Pakistanis. The
available evidence, although not conclusive, sug-
gests that Moscow has not yet given up all hope
that the West Pakistanis will be able to achieve
some sort of modus vivendi with the East wing
and that the volatile situation in the subcontinent
will subside.
Sudan: Complete Break with Soviets Avoided
The deterioration of Soviet-Sudanese rela-
tions has stopped short of a complete break, and
there are indications that neither side wants a
continuation of the public campaign of recrimina-
tion. The Soviets are gradually toning down the
public criticism of Numayri's actions, and the
Sudanese have stated that the do not "intend to
push matters any further."
Numayri himself
on 6 August denied that eit er oscow or Khar-
toum had asked for the withdrawal of the ad-
visers.
Nevertheless, Sudanese Defense Minister
Abbas confirmed on 7 August that Soviet advisers
were confined to their homes, and it was also
announced that Abbas would soon be making a
trip to Peking. These actions, as well as the public
accusations of the past few weeks, make certain
that Soviet-Sudanese relations will remain sour
for the time being.
Meanwhile, the crackdown on Sudanese
Communists continues with the arrest of 700
more party members. The Sudanese have stated
that 1,400 Communists were arrested immedi-
ately after the countercoup of 22 July, although
some of those arrested have since been found
innocent of plotting against Numayri and have
been released. These arrests strike primarily at the
young, educated urban class who make up the
leadership of the Sudanese Communist Party.
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Morocco: A New Look?
The transitional government that King Has-
san invested on 6 August to serve for a year or 18
months and to draft major reforms may provide
the country with a more efficient administration.
Only in this respect will it fulfill the King's prom-
ise-made on the heels of the military coup
attempt of 10 July-that the methods employed
by the regime, not its policies, will change. The
new government does not provide the clean slate
implicit in the King's later statement of 4August,
nor does it provide a much-needed broadened
base of support for the King.
The council of 16 ministers-11 holdovers
from the last government-is headed by Karim
Lamrani, the King's banker and business inter-
mediary. A Francophile, Lamrani is also director
general of the financially important state-owned
phosphate industry and has long been director of
the half dozen or so of the country's most im-
portant industrial complexes and banks. He
retains these bases of power.
entered the government last April as minister of
finance after the ouster of four ministers involved
in corruption, and he himself is not untouched by
the scandal. Like his recent predecessors,
Lamrani's role as prime minister is limited to
economic matters.
The appointment of the controversial farmer
minister of interior, Major General Mohamed
Oufkir, to the combined posts of minister of
national defense and operational commander of
the Royal Moroccan Armed Forces further in-
creases his already substantial personal power.
Although the King presumably retains his nom-
inal position as commander in chief, Oufkir is
likely to wield an almost free hand in whipping
the badly demoralized armed forces into shape.
Several close associates, or proteges, of Oufkir
hold key cabinet posts-notably the capable min-
isters of interior, Ahmed Benbouchta, and agricul-
ture, Maati Jorio-thus ensuring that Oufkir also
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Middle East Developments
Spokesmen in both Israel and Egypt con-
tinue to adhere to a hard line with regard to an
interim Suez agreement. In Israel, the press re-
ported that there was no criticism at the cabinet
meeting on 8 August of Prime Minister Golda
Meir's handling of the talks with Assistant Secre-
tary Sisco. Mrs. Meir said that "it is not easy for a
small nation to tell a big friend 'no,' but Israel
had to do this to prevent yet another war in the
future." Israel Defense Forces Chief of Staff Bar
Lev said that the Egyptians have no chance of
pushing Israel away from the canal. He stated,
however, that Israel should take seriously Egyp-
tian President Sadat's threats to renew the war
and noted that just as there are good reasons to
continue the current stalemate, there are likely to
be as good reasons that will lead the Egyptians to
renew the war.
Meanwhile, President Sadat again publicly
charged that the onus for the continued impasse
in the peace negotiations rests with the US. He
said Tel Aviv has openly demonstrated that it
does not want peace, and he stated once again
both that Egypt will not surrender any of its
claims to the occupied territory and that any
partial agreement on the Suez Canal must be only
the first phase of a total Israeli withdrawal and an
over-all solution to the Arab-Israeli conflict. He
also continued to hammer away at the theme that
1971 will be a year of decision.
IRAN: Confronted with its third successive and
worst wheat reversal in some time, Tehran is in
the market for nearly $100 million worth of grain
in order to ensure enough supplies for the 2500th
anniversary of its monarchy this year. Adverse
weather has reduced prospective crop yields to
only about three million tons, and with little on
hand, Iran probably will need to import at least
one million tons if it is to satisfy the demands of
Preparations are being made in Libya, Egypt,
and Syria for a referendum on 1 September re-
garding participation in the Federation of Arab
Republics (FAR). Presidents Qadhafi, Sadat, and
Asad are to meet in Damascus next week to ap-
prove the constitution and basic principles of the
new federation. Seminars and "enlightenment
committee" meetings are reportedly being held
throughout Libya to explain the federation to the
public: there. Although the US Embassy in Tripoli
expects close to a 100 per cent affirmative vote
on the referendum, it doubts that such a margin
will accurately reflect public opinion.
A clash on 9 August between an Israeli
patrol and fedayeen units along the Israeli-Leb-
anese border was the first such incident since
early July. An Israeli spokesman has confirmed
that the Israelis were engaged in a strike at feda-
yeen bases in the vicinity. Because the level of
fedayeen activity along the Israeli-Lebanese bor-
der has been relatively low in recent weeks, the
Israeli action may have been a pre-em tive strike
to keep the fedayeen off balance.
its heavy wheat-consuming populace. The Shah's
government, acutely aware of popular pressures,
appears determined to avoid speculation and price
rises during this year of national celebration. Ne-
gotiators are seeking to take advantage of long-
term US credits for agricultural produce, but the
proximity of Australian suppliers assures them a
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CYPRUS: The meeting on 9 August between the
Greek and Turkish Cypriot negotiators failed to
resolve the stalemate in the intercommunal talks,
and President Makarios may now take the issue to
the UN. The Greek Cypriot negotiator claims that
the latest Turkish Cypriot proposal--which asserts
that communal authority extend to the top level
of government and that the Greek Cypriots re-
nounce enosis (union of Cyprus with Greece)-
offers no hope for progress.
The Greek Cypriots are scheduled to reply
to the Turkish Cypriot proposal in late August. If
this meeting also flounders, the intercommunal
talks probably will be suspended pending the out-
come of bilateral Greek-Turkish discussions now
set for September.
It now appears that President Makarios, fear-
ful of an imposed Greco-Turkish solution, will ask
UN Secretary General Thant to help find a new
formula to keep the talks going. By appealing for
such UN intervention, Makarios may be hoping to
pre-empt the Athens-Ankara dialogue and to
maintain the status quo on the island.
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WESTERN HEMISPHERE
Chilean Developments
Factionalism within governing coalition
groups and the opposition Christian Democratic
Party has intensified conflicting pressures on Pres-
ident Allende but may increase his political ma-
neuverability. The Communist Party (PCCh), the
only Popular Unity (UP) coalition member not
split by internal dissension, may use its cohesion
to strengthen its position as Allende's most reli-
able support.
Allende would probably have preferred to
make political adjustments behind the scenes and
to maintain the facade of his original cabinet,
whose composition reflected prolonged UP in-
fighting. Five ministers resigned this week, how-
ever, following internal splits in UP parties. By
refusing most of the resignations, Allende main-
tained an ostensible balance, but has actually
done little to relieve the dissensions and impo-
tence of the Radical Party (PR) and the three
smallest UP members within the Communist- and
Socialist-dominated coalition.
dent personally refused to increase the govern-
ment wage raise offer to well-paid copper work-
ers, who backed down after a costly eleven-day
strike. He knew that concessions would set an
expensive precedent at a time when Chile, be-
cause of growing financial problems, urgently
needs every penny from its major export. On 11
August key technicians at another mine and farm
workers called strikes, pointing up the difficulties
of imposing the labor discipline Allende has de-
manded to increase productivity.
These and other economic difficulties have
made Allende and the Communists reluctant to
cause further damage to international confidence
in the Chilean economy by a flat refusal to com-
pensate US copper companies. The Socialists, on
the other hand, have pressed for such a refusal in
the conviction that a confrontation with the US
would mobilize the Chilean masses behind Al-
lende and enable him to move faster toward so-
cializaticn.
~Allendk___
values the pluralistic image projected by the sup-
port of the dissidents, as well as the fact that they
control some 23 votes in a Congress where the
opposition holds a majority. A substantial num-
ber of the dissidents have strong political ambi-
tions that Allende can play on to his advantage.
Economic problems are proving a more diffi-
cult challenge to Allende than politics. The Presi-
Justificai:ion for the refusal would be the asser-
tion that "excess profits," computed under pro-
visions of the constitutional reform for total
nationalization of copper, almost equal or surpass
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Dominican Republic: Stilt the Champ
President Balaguer is determined to wipe out
any lingering effects in the Dominican military of
former General Elias Wessin y Wessin's antigov-
ernment conspiracy and re-emphasize his own
authority.
The expected reassignment of key members
of the military was announced on 4 August. The
presence of known supporters of the powerful
Brigadier General Neit Nivar Seijas among the
new appointees appeared to enhance Nivar's al-
ready strong position and weaken that of his rival,
General Enrique Perez y Perez,
National Chief of Police
General Neit Nivar Seijas
Commander. First Briyad^
national chief of police, General Enrique Perez y
Perez.
Unexpected, however, was an unprecedented
presidential communique to the military and: the
national police that appeared in the press a few
days later. In it President Balaguer pointedly re-
minded the military and the police that their
business is to protect national security and sta-
bility, not to play poli-
tics. He exhorted the
forces to unity and pro-
fessed himself disgusted
with "some high-ranking
members of the armed
forces" who had lately
served as "an instrument
in maneuvers harmful to
stability and the coun-
try's internal and exter-
nal security."
General Nivar is as-
sumed to be the prin-
cipal target of the presi-
President Joaquin Balaguer
dential communique. His
recent public approval of the military's arrest in
San Cristobal of members of La Banda, an pnti-
Communist, antiterrorist organization, doubtless
irritated Balaguer. Nivar can hardly miss feeling
the presidential rebuke and those who feared that
the recent military appointments were too favora-
ble to Nivar may find themselves reassured.
It will be some time before the unsettling
effects of the Wessin incident are entirely dissi-
pated. President Balaguer, however, has demon-
strated that his political perception and nerve are
more than equal to the challenges so far pre-
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Panama: Church-State Relations
As a result of audiences with the Pope by
both President Demetrio Lakas and Archbishop
Marcos McGrath, pressure on the Torrijos gov-
ernment to disclose the fate of missing Colombian
priest Hector Gallego has lessened somewhat. Tor-
rijos is using the respite for increased attention to
internal matters and a bid for wider student sup-
port.
Public opinion in general and the church in
particular have been outraged over the disappear-
ance of Father Gallego on 9 June. Father Gallego,
in attempting to assist the peasants in Veraguas
Province, apparently antagonized the government
by either criticizing its land reform program or by
offending landed members of the Torrijos family.
The widespread belief that the National Guard is
responsible for his kidnaping-and possibly his
murder-has given the Torrijos government a
black eye both at home and abroad. The gov-
ernment's inactivity in solving the case has lent
credibility to the charge and has caused church-
state relations to reach their lowest point in re-
cent history. Archbishop McGrath and President
Lakas visited the Vatican on 28 July and during
the first week in August, respectively, to present
opposing sides of the case to the Poe.
Torrijos, in an effort to improve his gov-
ernment's image, has turned his attention to re-
Argentina: Antiterrorist Campaign
The rising level of urban terrorism has
prompted a government antiterrorist campaign
that may now include sponsorship of so-called
"death commands" aimed at eliminating urban
guerrillas and their supporters through extralegal
vamping the development planning machinery
and instituting a "federal" system-his latest im-
pulse. Although satisfied with most of the long-
term objectives proposed by his planners, Torrijos
has become impatient with the lack of any imme-
diate solutions. Torrijos contends that many of
Panama's problems are the result of a lack of local
autonomy. He therefore has proposed a "federal"
system under which each province would have a
governor appointed by the president. The gov-
ernors would in turn appoint councils to assist
them in planning and executing local programs.
In an effort to gain student support, Torrijos
has agreed to grant university students a number
of financial concessions as well as a chance to re-
view canal treaty proposals as the negotiations
progress. This appears to be a continuation of ear-
lier consultations with various interest groups de-
signed to develop a climate of opinion that can be
further mobilized and used during the nego-
tiations.
The church, although somewhat quieter dur-
ing the past two weeks, shows no signs of drop-
ping its agitation for continued investigation into
Father Gallego's fate. In fact, 9 August, the two-
month anniversary of the priest's disappearance,
was the occasion of an eight-hour prayer vigil in
Panama City. If the church should again demand
action on the Gallego case, Torrijos may try to
draw on some of the favorable public opinion he
is attempting to create.
means. The government's campaign is beginning
to show some results in arrests of high-level sub-
versive leaders, but the publicity being given to
the alleged "death squad tactics" may backfire
politically.
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Over the past several months at least five
separate terrorist groups have operated in Argen-
tina's major cities. These groups have carried out
bank robberies, terrorist bombings, political kid-
napings, and even the occupation of small towns
with near impunity. The government has begun to
counter these tactics in recent weeks by subordi-
nating the provincial police to the military in the
prevention and investigation of terrorist incidents
and by forming a new federal court to deal exclu-
sively with cases of subversion. There are growing
indications that the recent appearance of rightist
"death squads" may be another step by the mili-
tary government to deal with the terrorists.
One of the most serious terrorist incidents in
recent weeks was the political assassination on 29
July of the director of the penitentiary in Cor-
doba Province, one of the areas hardest hit by
urban violence. Three groups claimed that the
killing was "revolutionary execution number
one," suggesting that the various subversive
groups are now cooperating in certain operations
and that other security officials may be targeted
for assassination. Coinciding with this incident
TRINIDAD AND TOBAGO: Attempts have been
made this week on the lives of two key figures in
government action against mutineers in the local
military regiment. Captain David Bloom, com-
mander of the Trinidad and Tobago Coast Guard,
was shot and seriously wounded on 10 August.
was the announced formation of a right-wing,
counterrevolutionary group calling itself the Po-
lice Death Command. This group has vowed to
eliminate terrorists, their supporters, and lawyers
who defend them. It presumably was responsible
for the bombs that exploded on 31 July in the
homes and offices of eight Cordoba lawyers,' most
of whom were on its list.
The Cordoba Police Death Commanri ap-
pears to be made up primarily of provincial police
officers who want to deal with the terrorists on
their own terms. Still other right-wing groups in
Cordoba, Rosario, and Buenos Aires a ear to
have similar on ins
/The govern-
ment's alleged role in the aestre murder has
received considerable publicity and criticism in
the Argentine press and there is good reason to
expect similar treatment of the operations of
right-vying groups throughout the country.r1 25X1
been prominently involved in the prosecution
in three court-martials that have dealt with the
regiment's mutineers, was also shot, and
wounded.
Police believe the attack is directly related to the ~
prominent role Bloom played in the suppression
of the mutiny in the Trinidad and Tobago Regi-
ment in April 1970. A private from the regiment,
whom police suspect of having ties to the black
power movement in the regiment and to the civ-
ilian black radical movement as well, has been
detained.
A few hours after the attack on Bloom,
Theodore Roosevelt Guerra, a barrister who has
Although it is uncertain what effect, these
shootings will have over the long term, local
nervousness has been heightened and additional
pressure has been heaped upon a police force
already beset by an upsurge in crime in recent
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