WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A010900150001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 23
• Document Creation Date: December 21, 2016
• Document Release Date: November 20, 2007
• Sequence Number: 1
• Publication Date: November 8, 1974
• Content Type: SUMMARY

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Weekly Summary
DIA review
completed.
State Dept. review
completed
Secret
Secret
No. 0045/74
8 November 1974
Copy NO
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The WEEKLY SUMMARY,issued every Friday morning by
the Office of Current intelligence, reports and analyzes signif-
icant: developments of the week through noon on Thursday. It
frequently includes material coordinated with or prepared by
the Office of Economic Research, the Office of Strategic
Research, and the Directorate of Science and Technology.
Topics requiring more comprehensive treatment and therefore
published separately as Special Reports are listed in the
contents.
CONTENTS (November 8, 1974)
4 West Germany: Dealing with
Moscow and Pankow
5 EC - Arab States: Getting Ready
LU
8 USSR: Younger Admirals;
9 Turkey: The Stalemate Continues
10 UN: Discussing Disarmament
EAST ASIA
PACIFIC
11 South Vietnam: A Temporary Lull
12 Laos: Souvanna Returns
13 South Korea: Political Tensions
MIDDLE EAST
AFRICA
14 Lebanon: New Government
14 Kuwait Boosts Military Spending
15 Angola: Troubled Territory
WESTERN
HEMISPHERE
16 OAS: Anxiety at Quito
17 Chile Beset by Economic Problems
18 Peru: Confrontation Brewing
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 THE MIDDLE EAST
AFTER THE SUMMIT
(I -G)
The Arab summit last wee PC in Rabat, at
which the participants backed the claims of the
Palestine Liberation organization to future sover-
eignty over the Israeli-occupied West Bank, has
evoked a variety of responses from Arab capitals.
The most consistent theme emanating from Arab
spokesmen has been the notion that the summit
reinforced the image of unity among the Arabs
and clarified their demands in a Middle East peace
settlement. Satisfaction with this accomplish-
ment, however, appears to be tempered in some
quarters by concern over the effect of the sum-
mit's decision on prospects for restoring momen-
tum to the negotiating process. Israel this week
formally reiterated its unwillingness to deal with
the PLO.
Egypt: Victory and Defeat
Egyptian media have praised the summit as a
victory for Arab solidarity and even for President
Sadat's strategy, ignoring the reality that the deci-
sion on the PLO was a defeat for that strategy. It
seems clear that Sadat is now determined not to
break ranks with the other Arabs on the Palestin-
ian question. At the same time, media treatment
and public statements by Sadat and other spokes-
men betray some uncertainty about how to pro-
ceed on other issues related to negotiations.
A Cairo radio commentary immediately
after the summit, for instance, called for a recon-
vening of the Geneva conference in the near
future, and Sadat himself noted in a post-summit
press conference that any further Israeli with-
drawals must be on "all fronts." Although these
remarks suggest that Egypt now feels tied to a
comprehensive approach to negotiations in a
Geneva context, other public utterances from
Cairo seemed to leave the door open for further
staged withdrawals similar to the disengagement
agreements concluded this year on the Sinai and
Golan fronts.
The Egyptian information minister has said
that the summit only laid down principles and
that decisions on the "application" of these prin-
hi
s
ciples and on "timing" must come later. T
suggests a possible readiness to set aside the Pales-
tinian question while further negotiations are at-
tempted on other fronts.
Syria: Scuttling the Egyptians
Although the Syrians have played up the
PLO's victory at Rabat, they clearly believe that
they achieved their own main tactical objectives.
In scuttling Egyptian efforts to work out a com-
promise between Jordan and the PLO, they
hoped to undercut Secretary Kissinger's strategy
and to force both the US and Israel to take Syrian
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interests more into account during the current
phase of negotiations. They also wanted to make
it clear to President Sadat that they are opposed
to Egypt going ahead with any new negotiations
with Israel unless Syria receives something tangi-
ble at the same time.
Although there is concern in many quarters
that a reconvened Geneva conference would
quickly degenerate into a propaganda contest, the
Syrians apparently believe it is the only appropri-
ate forum for taking up the hard political ques-
tions that have not yet been addressed. Of major
concern to them in this respect is that Egypt not
be allowed to get out of step with the other
Arabs. As the Rabat meeting clearly demon-
strated, the Syrians have lost none of their dis-
trust of the Egyptians. They have apparently con-
cluded that the essentially bilateral, step-by-step
approach favored thus far by Secretary Kissinger
does not allow them to keep a close enough
watch over Sadat.
Jordan: "No Place in Negotiations"
Jordan's King Husayn, in an exclusive inter-
view he gave to the New York Times this week,
stated that the Israeli-occupied West Bank was no
longer a part of his country and that he therefore
had "no place in the negotiations over its future."
To take account of the decision in favor of the
PLO at Rabat, Husayn said he intends to change
Jordan's constitution and reorganize the cabinet
and parliament to remove representatives of Pales-
tinians living on the West Bank. Currently, about
half the members of the Jordanian parliament are
West Bankers who commute to sessions in
Amman.
Husayn also said that Palestinians living in
Jordan would soon have to choose between Jor-
danian citizenship and citizenship in whatever
entity is ultimately established on the West Bank.
He promised to continue to pay the salaries and
pensions of West Bank civil servants until Israeli
occupation ends. With a touch of bitterness, how-
ever, the King ruled out the possibility of a future
confederation between Jordan and a Palestinian
state, calling it "totally inconceivable."
Israel: Apprehensive But Ready
Israeli Prime Minister Rabin, in a statement
to the Knesset on November 5 giving his govern-
ment's official response to the summit, said that
his government completely rejects the conclusions
reached at Rabat and rules out any negotiations
with the PLO. Echoing a theme heard repeatedly
in Israel since the summit, he warned Arab leaders
not to think that the threat or use of force could
lead to a political solution. Israel, he said, would
not negotiate under Arab military pressure.
Rabin instead stressed the standard Israeli
position on Middle East peace negotiations: Israel
remains prepared to conduct talks with Jordan
concerning a solution to the Palestinian issue; and
it is ready to resume negotiations with Egypt and
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C' - )
Syria. Rabin was clearly unwilling to make new
proposals pending a review of current Middle East
peace prospects with Secretary Kissinger, who
arrived in Tel Aviv on November 7.
The Israelis are worried that the Arab nego-
tiating position has hardened after Rabat to the
point that there is a greater likelihood of renewed
hostilities. Even before the Rabat meeting, Israeli
pollsters found that nearly 55 percent of the
respondents thought war is likely in the near
future. Rabin and Defense Minister Peres have
recently emphasized to reporters that Israel, too,
retains a military option, is militarily stronger
now than a year earlier, and that it will not be
taken by surprise again. Both have pointedly left
open the possibility that Israel might even launch
a pre-emptive attack.
The Israelis are also apprehensive that pro-
PLO sentiment on the West Bank will grow
quickly in the wake of the concessions made to
Yasir Arafat at Rabat. Tel Aviv is particularly
concerned that this pro-PLO feeling will be trans-
lated into terrorist activity in the occupied terri-
tories. Shlomo Hillel, the Israeli minister respon-
sible for the West Bank, warned on November 6
that "all possible means" would be used to pre-
vent this.
Israeli military authorities early this week
deported four prominent West Bankers charged
with offenses ranging from signing a petition sup-
porting the PLO to membership in the illegal
Palestine National Front. Tel Aviv is hopeful that
the expulsion of these four, together with hints
that Israel might reconsider its policy of allowing
limited commercial contacts with Jordan's East
Bank, will inhibit West Bankers from offering
public expressions of support for the PLO-7
TAKING THE MILITAJY PULE
- '
Tension remained ~igh in the Middle East
last week, as both the Arabs and the Israelis
improved their combat preparedness.
an Egyptian armored brigade was seen on the way
from Cairo to the Ismailia area. At the same time,
one or two convoys of field artillery also were
seen headed for Ismailia. About 40 trucks with
bridging equipment and some amphibious vehicles
were observed about 12 miles west of the city on
November 3-the first time in six months that 25X1
such equipment was detected in this area. The
bridging ui ment may have been the same as
that seen
1 nassinq through Cairo en route to e
canal. In addition, an Algerian armored trigaae
was reported to have moved into the Suez City
area. The Algerian unit has been stationed near
Cairo since the war last year.
According t
had been forced -to react to Israeli military prep-
arations and were preparing to meet any situa-
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that training is being emphasized
and will continue so long as the situation "war-
rants a state of vigilance." He assured the at-
taches, however, that Egypt would "scrupulously
adhere to the disengagement agreement."
Damascus also has stepped up the pace of its
military activity. Intensive military training and
maneuvers have been held during the past several
weeks, and the Syrians reportedly are pressing
ahead with the construction of new defenses in
the capital area. There are no indications that
Syria has put its forces on high alert, but Chief of
Staff Shihabi has expressed nervousness and ir-
ritation over recent Israeli military exercises on
the Golan Heights.
Substantial quantities of military ecluipment
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West Germany
DEALING WITH MOSCOW AND PANKOW
Ij hancellor Schmidt has strengthened his cre-
dentials as a defender of West Berlin's political
and economic iinterests as a result of his meeting
with Soviet leaders in Moscow last week and his
government's recent bilateral negotiations with
East Germany. Although he has extracted conces-
sions from both Moscow and Pankow, skepticism
remains among the West German public about
Bonn's success in negotiating with the East be-
cause the full details are not yet known. The joint
communique issued at the end of the meeting
with Soviet leaders made scant reference to Ber-
lin, and no major bilateral accords were signed,
suggesting to some that the Chancellor accom-
plished very little.
Despite this impression, West German offi-
cials seem essentially pleased with the results of
the summit. Schmidt told the Soviet leaders flatly
that a joint project to build a nuclear power plant
in the USSR was unacceptable unless the trans-
mission lines for the delivery of electrical energy
run directly through West Berlin. In response, the
Soviets confirmed an earlier commitment on this
point and agreed to an arrangement that would
allow West German power plants to supply the
city if deliveries from the East are interrupted.
The Chancellor reiterated his position that
economic conditions do not permit Bonn to give
financial assistance for this project. The Soviets
were clearly displeased, as lengthy negotiations
with German firms and banks will now be re-
quired to resolve the financial difficulties. Mos-
cow also wants to discuss the routing of the
transmission lines with the East Germans, but
they are not expected to raise serious problems.
Schmidt and the Soviet leaders made some
progress toward including West Berlin in bilateral
accords, but the Soviets insisted that this "under-
standing" must not be publicized. The break-
through came on the last day of the talks, when
Soviet Foreign Minister Gromyko offered a novel
formula that allows the appropriate ministries in
Bonn and Moscow to handle exchanges on
humanitarian and scientific matters with the
proviso that no individual be excluded because of
his place of residence or professional activity-
such as federal employees working in West Berlin.
It is not yet clear whether this formula will
be applied to all the bilateral accords under nego-
tiation, but both sides seem satisfied that this
"pragmatic solution" avoids the legalistic pitfalls
inherent in their conflicting interpretations of
West Berlin's political status.
The Chancellor also agreed to sign a sub-
agreement--containing a Berlin clause-to the
Schmidt (1) and Brezhnev in Moscow
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long-term economic accord concluded last year.
This supplementary document is designed to facil-
itate more direct business contacts between So-
viet and German firms, but it is not a substitute
for the bilateral trade treaty that expires next
month. According to EC regulations, the Soviets
in the future will have to deal directly with the
EC Commission on trade matters.
Overall, the Soviets had few concrete results
to point to, but they seemed assured that
Schmidt is committed to continued improvement
in bilateral relations. The two countries' foreign
ministers will now try to meet annually. Soviet
press commentary has placed heavy stress on the
bilateral economic gains that had supposedly been
made.
Schmidt's ? decision early last month to
harden Bonn's negotiating position with Pankow
has also produced results. Only a day before
Schmidt's meeting in Moscow, the East Germans
announced that the minimum currency exchange
requirement for visits to East Germany would be
reduced significantly, returning it virtually to its
former level by November 15.
Most West German and West Berlin politi-
cians called the decision a first step in the right
direction. There are some complaints, however,
that old age pensioners still must pay the ex-
change requirement, as well as speculation that
Schmidt may have made substantial economic
concessions-such as continuing interest-free
credit arrangements-to induce East German
flexibility.
In fact, however, Schmidt did not offer any
economic concessions, despite his interest in gain-
ing Pankow's cooperation on a number of joint
projects. On the contrary, he has authorized
Bonn's official representative in East Berlin to
press for a full return of the exchange require-
ment to its former level and exemptions for pen-
sioners. Bonn evidently remains hopeful that
Pankow's desire for interest-free credits will lead
it to make concessions. Once Pankow demon-
strates its willingness to compromise, Bonn stands
ready to resume talks on credit as well as other
elements of the "package deal" on economic co-
operation.
EC - ARAB STATES: GETTING READY
-T- C
[During their recent m 1etings in Cairo, repre-
sentiatives of the EC and the Arab League dis-
cussed procedural matters relating to the "Euro-
Arab dialogue" and agreed to hold the first meet-
ing of the general commission in Paris, probably
in late November. Although Arab oil-and the
Nine's dependence upon it-has nowhere entered
into the preliminary discussions, it has implicit
importance as a background factor.
The EC-Arab dialogue developed from a
French initiative earlier this year and is intended
to provide a broad framework for relations be-
tween the Nine and the Arab states. Progress has
been slow in organizing working groups and in
completing other administrative preparations.
At the Cairo sessions last month, the EC
proposed establishing working groups in agricul-
ture, industry, financial matters (to include re-
cycling of oil dollars), culture, and technology.
Despite reservations on the part of certain unspec-
ified leaders, the Arabs approved these and re-
lated proposals at the Rabat conference. Accord-
ing to an EC Commission official, the coming
Paris meetings will undoubtedly be restricted to
procedural questions. If all goes well, however,
the working groups will be established and could
come up with definite recommendations by
spring.
The EC official told the US mission
to the EC that it is clearly understood among the
Nine that political questions surrounding a Middle
East peace settlement would be avoided during
talks with the Arabs. When the dialogue was
begun, however, the Arab resolution agreeing to it
gave priority to political cooperation as an area
for joint action and, despite the EC's intentions
to avoid political questions, the Arabs have said
they want to discuss matters related to a Middle
Fast c settlement.
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USSR-PORTUGAL: OL HOME WEEK ))
~)~_,
e Co monist
of even the mores 9
Few
lead rs would have dreamed that long-time Mos-
cow resident Alvaro Cunhal would one day return
to the Soviet capital as a minister in a Portuguese
government. But the leader of the Portuguese
Communist Party was in Moscow last week, head-
ing the first official delegation Lisbon has ever
sent to the Soviet Union. The Soviets greeted him
with the warmth due an old comrade, and they
seemed not overly sensitive to the possibility of
creating problems for the Portuguese or other
West European Communists by their embrace of
Cunhal.
The Portuguese delegation appeared eager to
make up for 50 years of lost time. Over a six-day
period-in addition to the usual round of cere-
monial activities-it met with representatives of
the Soviet Foreign Trade, Foreign Affairs, Cul-
ture, and Merchant Marine ministries, the com-
mittees for Science and Technology and Foreign
Economic Relations, and the CPSU Central Com-
mittee. Cunhal talked with Soviet President
Podgorny, but not with party chief Brezhnev or
Premier Kosygin. He had a session with Boris
Ponomarev, CPSU Central Committee secretary in
charge of relations with non-ruling parties, reflect-
ing Cunhal's dual role as government minister and
head of the Portuguese Communist Party.
No agreements were signed during the visit,
but the joint communique reported that negotia-
tions on a bilateral trade agreement would begin
next month. The communique also stressed the
desirability of preparing concrete proposals on
scientific-technical cooperation and noted that
negotiations on a cultural cooperation agreement
would also be undertaken. References to starting
each set of negotiations "in the near future" or
"as soon as possible" lend an air of urgency to the
development of relations and project a strong
Soviet interest in Portugal.
While Moscow is clearly satisfied with events
in Portugal, the Soviets were careful to avoid any
concrete commitments at this time or to give the
appearance of meddling too obviously in Portu-
guese affairs. Moscow is still concerned about the
Alvaro Cunhal
Portuguese Communist Party leader
possibility of a rightist resurgence in Portugal and
does not want to give the "counter-revolution" a
ready-made rallying point.
The Soviets emphasized the economic side
of relations during the visit, not only because
they do not want to incite the Portuguese right
wing, but also because they recognize that the
seriousness of Portuguese economic problems
could undermine the position of the new govern-
ment and Cunhal's Communists. Thus, the Soviet
negotiating group was conspicuously led by For-
eign Trade Minister Patolichev. Nevertheless, the
Soviets warned that there would be limits to their
economic assistance; Podgorny spoke of the
USSR helping to solve Portugal's economic prob-
lems "to the extent that it is in a position to do
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YOUNGER ADMIRAL? MOVE UP
JRecent shifts in theme Soviet naval high com-
mand have brought some younger admirals into
positions of greater responsibility and influence.
The new naval leaders will probably continue to
emphasize the use of naval forces to further So-
viet political interests in peacetime.
The most important shift occurred in early
October when Fleet Admiral Smirnov, age 57,
replaced Fleet Admiral Kasatonov, age 64, as first
deputy commander in chief of the Soviet navy;
Kasatonov will probably retire. Srnirnov's new
position makes him the logical successor to Ad-
miral Gorshkov, commander of the Soviet navy,
when Gorshkov leaves his post. Gorshkov, who is
64, has commanded the navy since 1956 and is
likely to step down in the next few years. If
Smirnov does succeed Gorshkov, he will be the
first submarine officer to command the Soviet
navy.
Smirnov formerly commanded the Soviet
Pacific Fleet. With his promotion last year to the
rank of fleet admiral-the first Pacific Fleet com-
mander to hold that rank-he immediately be-
came a likely candidate to replace Kasatonov.
Kasatonov has been active in the Incidents at Sea
discussions with the US, and Smirnov probably
will take over this assignment.
Smirnov was succeeded as commander of the
Pacific Fleet by his former deputy, Vice Admiral
Maslov, a submarine officer in his late forties.
This continues the recent pattern of fleet com-
rnand assignments in which submarine officers
have commanded the open-ocean fleets-the
Northern and Pacific-and surface ship officers
have commanded the closed-sea fleets-the Baltic
,rnd the Black.
Other changes in the naval hierarchy since
mid-1974 due to death, retirement, or transfers
have brought younger officers with little or no
World War II combat experience to important
posts. These include, for example, the new com-
mander of the Black Sea Fleet, Vice Admiral
Khovrin, and the new commander of naval avia-
tion, Colonel General Mironenko. Many of these
younger officers have participated in distant
cruises and visits to foreign ports. They are less
likely to be as tradition-bound as their predeces-
sors, and may also be more receptive to new
strategic concepts or to innovative proposals for
naval weapons systems :T
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TURKEY: THE STALEMATE CONTINUES
ec
aretaker Prime is er YEc it's failure to
obta support from other parties in his attempt
to form a new government has prompted him to
postpone Secretary of State Kissinger's trip to
Ankara and to withdraw as prime minister - desig-
nate. This deepening of the 50-day-old govern-
ment stalemate followed Justice Party leader
Demirel's rejection earlier in the week of a broad
range of proposals for forming a new government
submitted to him last month by Ecevit.
Demirel's rejection of Ecevit's nine pro-
posals, including the offer of a coalition or for
either party to support a minority government by
the other, left Ecevit with little new to try. He
approached the small right-of-center Democratic
Party with a coalition offer but, as on two pre-
vious occasions, the Democrats turned him down.
Ecevit then sought support for a minority govern-
ment, but he was forced to ask President Koru-
turk to relieve him of the task of forming the new
government when the three major rightist parties
announced that they were unalterably opposed.
Ecevit will continue as head of the caretaker
government until a new one is formed, but he
apparently believes that this position does not
give him the necessary base from which to hold
high-level discussions with Secretary Kissinger on
the Cyprus problem. While Ecevit no doubt
would be unable to agree to any major conces-
sions to move the Cyprus issue toward resolution,
the postponement of the secretary's visit may also
have been a ploy on Ecevit's part to convince
other political leaders of the necessity of moving
rapidly to organize a new government. By placing
the onus for the continuing stalemate on the
recalcitrant opposition, Ecevit may hope to offset
charges that he blundered by seeking political
gain from the Cyprus issue when he dissolved his
governing coalition on September 18.
President Koruturk has only two options
available in attempting to break the political
logjam, both of which have been tried once be-
fore. He can turn to a political leader from the
right to try to form a coalition. Demirel, as head
of the largest opposition party, is the logical
choice, but he has already tried and failed. This
makes it more likely that Koruturk would turn to
another Justice Party leader, or perhaps to the
leader of one of the smaller rightist parties, such
as Ferruh Bozbeyli of the Democratic Party. The
President's other choice would be to try to put
together a nonpartisan government, as was done
following the elections in 1973 when it took
three months to forge a coalition. Koruturk raised
this possibility last month, but it was roundly
rejected by all political parties.
The caretaker government can probably con-
tinue to function indefinitely, but it can take no
new initiatives and can resolve none of the out-
standing problems. The Turkish constitution has
no provision for dissolving parliament and calling
new elections under these circumstances, unless
parliament itself agrees to the move. In the mean-
time, both Ecevit and his rightist opposition will
try to blame the other for the continuing stale-
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UN: DISCUSSING DISARMAMENT
The concern of many ountriess 91-
over the
growing risk of nuclear proliferation has sparked a
more active debate than usual on disarmament
questions at the current session of the General
Assembly. A number of members are frustrated
by what they see as years of desultory negotia-
tions on arms control and disarmament, and they
were additionally jolted by the Indian nuclear test
in May, which many countries felt confirmed the
failure of UN disarmament efforts. They are now
pushing for early progress toward a test ban
treaty or, at the least, toward stemming the ac-
celeration of international weapons development.
Progress thus far would seem to indicate con-
tinued frustration.
India's efforts to justify its nuclear explosion
as "peaceful" have focused international atten-
tion on this facet of nuclear development as well
and have alerted many countries to the prolifera-
tion potential of peaceful nuclear explosions. This
question is being addressed in a number of UN-
associated committees or organizations, but many
developing countries believe that the General
Assembly should also become involved. These
countries argue that peaceful nuclear explosions
raise political, technical, and economic issues that
require full-blown assembly debate. Moreover, the
developing countries feel they can exert little
pressure for disarmament in the more restricted
negotiating groups.
The Japanese have been among the most
active in pushing for the adoption of effective
disarmament and nonproliferation measures. As a
follow-up to Foreign Minister Kimura's General
Assembly speech, which highlighted Japan's
desire to involve the UN more fully in non-
proliferation, Tokyo has indicated it will press for
a resolution to study peaceful nuclear explosions,
probably in the Conference of the Committee on
Disarmament. The Japanese-and the principal
co-sponsors of such a resolution, the Dutch and
the Swedes--hope that such a study would help
convince states that they can afford to give up
their option to conduct peaceful nuclear ex-
plosions. A provision to cease all such tests until
completion of the study was dropped after the
expected opposition of some countries, par-
ticularly India. Even so, the Indians are ap-
parently still not satisfied, and their attempts to
drum up opposition may force deferral of the
peaceful nuclear explosion issue until next year.
In addition to focusing attention on peaceful
nuclear explosions, the Indian nuclear test has
also rekindled interest in the concept of nuclear-
free zones. Resolutions calling for the establish-
ment of such zones in the Middle East and South
Asia have already been submitted; Nigeria is
thinking of submitting a resolution on an African
nuclear-free zone; and Finland may call for an
experts' study of the whole nuclear-free-zone
concept. The Pakistanis have been pressing the
permanent Security Council members for a new
resolution guaranteeing the security of the
non-nuclear countries, but so far with little result.
Calls for the conclusion of a comprehensive
nuclear test ban agreement continue to have
majority support. This year, the Australians and
New Zealanders have spearheaded these efforts.
Despite their initial intention to press for a
resolution banning the testing of all nuclear
explosive devices-including peaceful nuclear
explosions-the opposition of the nonaligned
states, particularly India, has led the co-sponsors
to specify a nuclear weapons testing ban only.
The Indians and others object to any resolution
that equates peaceful nuclear explosions with
nuclear weapons testing.
A Soviet-sponsored resolution calling for a
convention banning the modification of the
environment for military purposes has received
strong nonaligned support, although most of the
developed countries are not enthusiastic about it.
They argue that the resolution fails to separate
the arms control aspects of the proposed con-
vention from the broader environmental issues it
raises. Pollution and environmental aspects of the
question, they believe, are best handled in other
existing UN organizations, while the disarmament
implications require further study.
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 SOUTH VIETNAM: A TEMPORARY ,.ULL
rFollowing the rash of demon'trations fo-
cusdd on the National Day celebrations, South
Vietnam is enjoying a week of relative calm. Cath-
olic dissidents are busy planning more rallies, and
the Buddhists are working hard in the provinces
to organize their National Reconciliation move-
ment. The present quiet may also be due in part
to an implied warning by President Thieu in his
National Day speech on November 1 that the
government was prepared to get tougher with the
protesters if renewed demonstrations got out of
hand.
Thieu's remarks on the holiday that cele-
brates the overthrow of the Diem regime repre-
sented an appeal for national unity and for sup-
port from the more moderate political opposition
and national religious leaders. Thieu urged the
population at large not to join minority elements
in protests against the government. He indirectly
accused the protest groups of receiving active
support from the Communists and claimed that
the demonstrations would only encourage the
enemy to step up the fighting.
The President balanced these remarks, how-
ever, with a promise to continue his campaign to
clean up the government and to push for liberal-
ization of restrictions on the press and political
parties. He did not announce any new personnel
changes.
Alluding to the presidential election next
year, he said it was not important who was presi-
dent, but only that the country remain in the
hands of nationalists who will not bow to in-
flexible Communist political demands.
Some Western press reporting has inter-
preted these remarks to mean that Thieu is con-
sidering resignation. Over the years, however,
Thieu has often indicated his willingness to step
aside if necessary, mainly to demonstrate that he
is interested primarily in the country's welfare
rather than his own.
support for the dissidents.
Thieu also issued a press release quoting
President Ford's recent letter affirming US sup-
port for South Vietnam. Thieu no doubt hopes
the letter will help lessen fears of eventual US 25X1
abandonment, show that he retains the full confi-
dence of the US, and dispel rumors of secret US
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LAOS: SOUVANNA RETURNS
Prime Minister Sou anna Phouma has re-
turndd to Vientiane from France following nearly
ten weeks of convalescence from the serious heart
attack he suffered in mid-July. Despite statements
by Souvanna's Lao doctor that the Prime Minis-
ter's recovery was proceeding "normally," there
are strong indications to the contrary.
The 73-year-old Prime Minister intends to
continue his recuperation in the royal capital of
Luang Prabang, and is likely to remain there at
least until next. April. Khamphan Panya, the coali-
tion government's newly appointed ambassador
to Washington and a close confidant of the Prime
Minister, believes that Souvanna will be relatively
inactive while in Luang Prabang and is hopeful
that contentious political issues will remain on
the back burner. Souvanna's recovery probably
depends on the extent to which he is able to
avoid personal involvement in the host of difficult
political problems confronting the coalition.
The odds are slim, however, that Souvanna
will succeed in sidestepping the political firing
line for very long. For one thing, the coalition's
Joint National Political Council, chaired by Lao
Communist leader Souphanouvong, reconvenes
shortly in general session in Luang Prabang. There
has also been talk of relocating much of the
government administration from Vientiane to the
royal capital. It seems almost inevitable that Sou-
vanna will be exposed to strong, competing politi-
cal pressures from the coalition partners.
The Communists can be expected to push
hard for Souphanouvong's original 18-point na-
tional political program; for dissolution of the
dormant, rightist-dominated National Assembly
and its replacement by the Political Council; and
for diplomatic recognition of the shadow Com-
munist regimes in South Vietnam and Cambodia.
They may also agitate for a cabinet reshuffle
to remove uncooperative rightist politicians from
the government.
the Communists have singled out power u e-
fense Minister Sisouk na Champassak, Finance
Minister Ngon Sananikone, and Deputy Foreign
Minister Tianethone Chantharasy for dismissal.
While the Communists probably recognize there is
little chance of prevailing upon Souvanna to sack
Sisouk or Ngon, their real target may be the
deputy foreign minister. With the recalcitrant
Tianethone out of the way, Communist Foreign
Minister Phoumi Vongvichit would be able to
pursue Pathet Lao foreign policy objectives with a
freer hand.
The non-Communists will pressure Souvanna
to resist all of these Communist demands, but
they also recognize that the ailing Souvanna may
be unable to resume his full prime ministerial
duties, and they are beginning seriously to con-
sider the choice of a successor amenable to their
political interests. While they seem to prefer a
candidate from the royal family-King's Council
President Prince Khammao is the current front
runner-they have not overlooked neutralist In-
terior Minister Pheng Phongsavan as a possible
compromise. The non-Communists are convinced
that Hanoi and Sam Neua are busily grooming
Souphanouvong for the prime ministership, but,
in spite of the impressive nationalist credentials of
the "Red Prince," they regard him as unaccept-
able at this early stage of the coalition.
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,%me S E U K L I low,
SOUTH KOREA: POLITICAL TENSIONS
''resident Ford's visit to Seoul, scheduled for
4'
Novehiber 22-23, has provided a focus for a bold
effort by anti-regime elements to advertise their
grievances. Since late September, Pak's opponents
have kept up a fairly steady drumbeat of protest
against his persistent refusal to release imprisoned
dissenters and undertake democratic reforms:
? Large-scale student rallies and demon-
strations, many leading to clashes with riot
police, now occur almost daily in Seoul and,
less frequently, in provincial cities.
? Seoul's major daily newspapers recently
challenged government censorship and won
the right to publish limited information on
opposition. activities.
? The main opposition party leader, Kim
Yong-sam, has been pressing vigorously in the
National Assembly for constitutional reform;
late last week, Kim's party voted to boycott
all other assembly activities until this issue is
taken up.
? Though protests by Protestant and Cath-
olic groups have eased somewhat since major
rallies in October, further anti-regime activ-
ities by these groups are likely over the next
two weeks.
The Pak government's immediate concern is
to ride out the current round of unrest until
President Ford's visit is completed. It is using a
combination of firmness and restraint, dis-
couraging greater street activity while avoiding
wholesale suppression. Universities with the most
militant student bodies are being shut down, but
relatively few students-or Christian activists,
either--have been arrested, and even these have
been given light punishment. Although the gov-
ernment has backed off from an immediate con-
frontation with the press, the most defiant
newsmen have been warned of harsh
retribution later on. Pak's lieutenants are working
hard--but behind the scenes--to undermine Kim
Yong-sam's position in the assembly.
The attention of both government and op-
position is now focused on President Ford's visit.
All factions consider the US to be a key influence
in determining how Pak handles his domestic
critics. The opposition is concerned that the Ford
visit will be construed as an across-the-board en-
dorsement of Pak's domestic policies. Pak is
annoyed that his adversaries are taking advantage
of the visit to press their attack. But he badly
wants President Ford to come and probably
believes that continuation of his present, fairly
restrained handling of the opposition will prevent
the sort of domestic uproar that might lead the
US to reconsider the visit.
Following the Ford visit, Pak will have to
decide whether to reach out to the opposition
with some kind of conciliatory moves or to return
to the harsh repressive measures of earlier this
year. If Pak decides on another crackdown, polit-
ical tensions could eventually build to a breaking
point. Further street demonstrations by students
or Christians could evolve into the sort of massive
gathering that requires major police and military
countermeasures. Pak cannot be certain that his
police and military units would shed the blood of
fellow Koreans to defend his regime. The dis-
sident elements, heretofore relatively unco-
ordinated in their anti-regime activities, could in
time coalesce under effective political leadership.
Kim Yong-sam seems to be waiting for such an
opportunity. In addition, the South Korean eco-
nomic situation, expected to worsen over the
coming winter, has already begun to generate an
unusual degree of labor unrest in the country. If,
as expected, unemployment grows more serious,
the opposition's support in the streets could
grow.
Despite the possibility of increased dissent,
Pak is concerned that a conciliatory course might
only encourage the opposition to enlarge its
demands. Pak's pragmatism could lead him to
offer some gestures of reconciliation aimed at
containing the opposition over the winter. He is,
nonetheless, convinced of the essential rightness
of his authoritarian policies, and he is unlikely to
make any major concessions to his opponents.
The outlook, therefore, is for another round of
political warfare in South Korea on the pattern of
the past year.
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LEBANON: NEW GOVERNMENT
(b)
\'President Franjiyah's rmal appointment on
October 31 of Prime Minister Rashid Sulh and his
18-member cabinet has ended Lebanon's month-
old government crisis. The installation of the new
government, however, will not provide relief from
the security, economic, and social problems that
forced the resignation of former prime minister
Taqi al-Din Sulh.
The new Prime Minister, like his predecessor,
has put together a cabinet designed primarily to
balance Lebanon's several religious and political
blocs. It is dominated by conservative, older gen-
eration politicians known more for their loyalty
to President Franjiyah than for any innovative
ideas on public policy.
Sulh has kept for himself the most impor-
tant post, that of interior minister. This reflects
the priority he attaches to reducing civil disorder
among fringe elements of the major political par-
ties and the Palestinians and to maintaining the
government's currently tolerable relations with
leaders of the major fedayeen organizations.
These tasks should be eased by the cooperation
Sulh has been promised by Kamal Jumblatt,
Lebanon's leading pro-Palestinian politician, and
by the Syrian government. Damascus has the25X1
ability to help contain Lebanon's internal security
problem by restricting fedayeen movements and
arms shipments.
KUWAIT BOOSTS MILITARY SPENDING
Kuwait s using its substantial oil revenues to
speed up its military procurement program. Most
purchases have been made from France, but Ku-
wait is negotiating with other West European
countries and the US in an effort to diversify
supply sources.
During the first half of this year, Kuwait
concluded major agreements with France worth
about $115 million, more than half the total
value of Western-Kuwaiti agreements during the
past two decades. These contracts were for Ga-
zelle and Puma helicopters as well as at least
one squadron of Mirage F-1 aircraft. Negotiations
are continuing for the purchase of the Crotale,
Roland, HOT, and Milan missile systems.
In September, Kuwait signed a contract with
the French manufacturer Avions Marcel Dassault
for two types of military aircraft, perhaps includ-
ing another squadron of Mirages. Kuwait, like
Saudi Arabia, may be purchasing the Mirages for
later delivery to Egypt. The UK has also ex-
pressed an interest in selling Kuwait the Anglo-
French Dassault-Breguet/BAC Jaguar aircraft.
The US is beginning to penetrate the Ku-
waiti market. Negotiations began last year on a
$560 million arms package covering jet fighters,
helicopters, tanks, anti-tank and anti-aircraft mis-
siles, and radar. In August an $11 million agree-
ment: was concluded for 1,800 TOW missiles and
some ancillary equipment and training, and
another contract for US Hawk surface-to-air mis-
siles and two squadrons of A-4M Skyhawk air-25X1
craft will probably be signed soon. Currently, 97
Kuwaiti pilots and cadets are in the US for train-
ing on this aircraft.
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t-,) I.._ V I < I
SOUTH-WEST
AFRICA
\ONTERNATIONAL rERRITORYI
WALVIS BAY
IREF OF S. AF.I
Windhoek
ANGOLA: TROUBLED TERRITORY
(ASCa cc;uv'(rb/
Portuguese authorities and Angolan insur-
gent groups are still far from agreement on a plan
for decolonizing the territory, even though the
three rebel groups have agreed to suspend hostil-
ities and are establishing offices in Luanda. Mean-
while, the weakness of the present territorial
government has been underscored recently by an
outbreak of racial violence in northeastern Angola
and by fighting between rival insurgent groups in
the exclave of Cabinda.
In an attempt to speed up the decoloniza-
tion process, Admiral Rosa Coutinho, head of the
military junta that Lisbon installed last summer
to run the territory, is taking a personal role in
talks with the insurgents. On October 27, he met
with Jonas Savimbi, leader of the National Union
for the Total Independence of Angola, the
smallest of the insurgent groups. Rosa Coutinho is
also seeking to arrange personal meetings with
Agostinho Neto, president of the Popular Move-
ment for the Liberation of Angola, and with
Holden Roberto, who heads the National Front
for the Liberation of Angola. Roberto, however,
refuses to recognize the territory's junta, which
he apparently believes is prejudiced against his
group, and has affirmed that he will deal only
with Lisbon.
The junta believes that the success of any
decolonization plan depends on cooperation
among the three insurgent groups and the new,
largely white, non-insurgent political organiza-
tions that have emerged in Angola since the,coup
in Portugal. Neto recently told reporters that he is
negotiating with Roberto, but that both of them
refuse to join with Savimbi and that both reject
the participation of the non-insurgent groups in a
transitional government. The Portuguese are con-
cerned about the disruptive potential of Angola's
500,000 whites, who are not likely to accede
quietly to their exclusion from the regime that is
to lead the territory to independence.
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F_ I
A sudden wave of racial violence broke out
in northeastern Angola two weeks ago, catching
the Angolan authorities unprepared. A number of
farms have been burned out, stores and public
buildings sacked, and white travelers ambushed.
By late this week, such incidents were continuing.
The violence reportedly was initiated by ma-
rauding bands of Africans taking revenge against
white farmers and merchants against whom they
had grievances. White vigilantes dressed in mili-
tary jungle garb were said to have retaliated with
attacks against African villages. The violence was
not associated with any of the nationalist move-
ments.
Meanwhile, a brief skirmish occurred late
last week in the oil-rich Angolan exclave of
Cabinda between a local separatist group and the
Popular Movement for the Liberation of Angola.
This points up another complication for the
Portuguese, as both Lisbon and the insurgents
regard the exclave as a district of Angola. The
Cabindan separatist movement is small and is split
into two opposing factions, but separatist senti-
ment in the exclave has a long history and is now
beginning to re-emerge after a period of dor-
mancy.
In the wake of the recent skirmish, Portu-
guese army elements, acting jointly with troops of
the Popular Movement, occupied key installations
and arrested the local governor and his staff. The
Portuguese junior officers who led the operation
had been looking for an excuse to oust the gov-
ernor, who had supported the separatists. The
junior officers apparently acted without prior ap-
proval from Luanda.
Such unauthorized moves by junior army
officers have occurred in Angola and Mozambique
several times since the coup in Lisbon. On this
occasion, the action taken squared with the
policy of the governing juntas in Angola and
Lisbon-namely, to cooperate with recognized in-
surgent groups to maintain order. The recurrence
of such incidents, however, hints at a lack of
discipline in the Portuguese military that .could
prove disruptive in Angola, especially if political
disagreements intensify and more people begin
OAS: ANXIETY AT QUITO.
The OAS f~reign ministers will 9 w open their
con erence at Quito in a somewhat testy and
anxious mood. The single purpose of the meeting,
which runs from November 8 through 11, is to
decide on the proposal to rescind the ten-year-old
diplomatic and economic sanctions against Cuba,
but the delegates sense that much more is at
stake. They expect that the way the conference
unfolds will be an important determinant of the
prospects for continuing the new inter-American
dialogue that opened early this year.
Apprehension that the meeting might evolve
as a negative factor for the dialogue has arisen
from several directions:
? The sponsors of the resolution under
review have lost confidence that they have the
14 votes required to win.
? Exchanges between those favoring the
termination of sanctions and those opposed
have become rancorous.
? Smoldering resentments against the US
are adding to the potential for a contentious
atmosphere.
As the conference begins, only 11 ayes and 3
nays appear secure. The votes of Brazil, Guate-
mala, the Dominican Republic, Haiti, Nicaragua,
and Bolivia remain up for grabs in varying
degrees. Some of these governments want to fol-
low a US lead; Brazil definitely does not. In any
case, the absence of a defined US position has
made them uncertain about where to stand.
Chile and Uruguay have become increasingly
aggressive with their anti-Cuban theme and ir-
ritated with the general lack of interest by the
other governments in Santiago's and Montevideo's
accusations against Havana. Reports that the
Costa Rican foreign minister made insulting
remarks about their "fanatical" view have angered
the two governments further.
Editorial commentary in various countries
has continued to raise speculation that some
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:. JIZZU 1i I
delegates might bring up US involvement in
Chilean politics as a lever against the delegations
opposed to lifting the sanctions.
Most of the governments believe that if
future inter-American assemblies are to proceed
constructively, Quito must play out as a dignified
and conclusive exercise. For the sake of this larger
interest, they will probably make an intense ef-
fort to play down their differences over Cuba and
seek a formula that dismisses the issue without
greatly offending any government. But existing
frictions will not be easy to overcome, and there
is a real risk that the conference will be a setback
to hemispheric efforts to forge a more coopera-
tive spirit.
CHILE BESET BY ECONOMIC PROBLEMS
Chile faces a eakoutloo next year,
desoite some progress in coping with its economic
problems. Sharply lower earnings from copper
exports will probably force the junta to reverse its
import liberalization program, thus retarding eco-
nomic growth and fueling inflation. Reduced ex-
port earnings will also require new and larger
foreign assistance as well as another debt re-
scheduling by Chile's major Western creditors.
The austerity measures introduced a year
ago by the junta have failed to control inflation.
The cost-of-living index this year is likely to hit
350 percent, far above the junta's initial goal of
only allowing prices to double. The austerity
program's impact fell mainly on workers. Pur-
chasing power was sharply reduced as wage hikes
were kept below price increases. Unemployment
rose to the highest level in 15 years after private
businesses were permitted to fire large numbers of
redundant workers who had been retained
because of political pressures from the Allende
government. The failure to control price increases
stemmed from rapid growth in the money supply
that reflected an unwillingness to restrain credit
expansion to government agencies. Moreover,
high world market prices for food and fuel
together with periodic devaluations sharply
increased import costs.
The junta is now shifting its tactics. It is
attempting to shave spending by cutting back
government employment by 15 percent. At the
same time, it is moving to reduce some of the
hardships imposed on laborers. Wages are now
being raised quarterly to keep pace with the cost
of living and to halt the previous erosion of real
wages. Moreover, released government employees
are being granted subsidies to establish businesses.
The attack on government spending is
unlikely to be successful next year. Falling profits
from copper are likely to offset the receipts from
new taxes that the junta plans to introduce. More-
over, higher wages and subsidy expenditures may
well wipe out the initial savings from smaller
public payrolls. Plans to cut credit to government
agencies will have to be postponed. Combined
with rising import costs, the new measures could
make a mockery of the junta's hopes of reducing
the 1975 inflation rate below 100 percent.
The junta will also find it difficult to sustain
programs to improve the worker's situation. An
unexpectedly poor wheat crop will keep the food
import bill high, and falling domestic petroleum
production will boost oil import requirements.
These factors, combined with lower copper earn-
ings, could push the 1975 trade deficit well above
the $300-million deficit projected for this year.
Because existing credits will be insufficient to
offset the deficit, Santiago will probably seek
additional foreign assistance, particularly from
the US, and call for further debt relief from its
Western creditors.
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PERU: CONFRONTATION STILL BR WING
Unrest in the navy cont~tues at ~a high level,
but the threat of a general move to oust President
Velasco by army moderates appears to have
lessened, at least for the time being. Both moder-
ate and radical officers are trying to strengthen
their positions, however, and a decisive confronta-
tion between them in the near term remains
likely.
The re- 25X1
cently enacted military retirement regulation that
set off the latest coup plotting presumably re-
mains in effect and could be used to undercut the
moderates' power in the government.
attempt to maintain as high a degree of militar
Furthermore, it is unlikely that Velasco has
softened his strong misgivings about allowing a
moderate such as Morales Bermudez to assume
the position of prime minister. Although it is
probable that Velasco plans further moves to 25X1
weaken Morales Bermudez, he may delay in an
Velasco
The threat has lessened
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