THE PRESIDENT'S DAILY BRIEF 17 JANUARY 1975

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007920
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: January 17, 1975

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The President's Daily Brief
January 17, 1975
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Exempt from general
?
declassification schedule of E.O. 11652
exemption category 58( I ),(2).(3)
declassified only on approval of
the Director of Central Intelligence
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FOR THE PRESIDENT ONLY
USSR:
Janaury 17, 1975
Table of Contents
(Page 1)
Egypt: President Sadat has raised the pitch of dip-
lomatic rhetoric to fend off Arab criticism
that he is moving ahead of the other belliger-
ents in negotiations. (Page 2)
USSR: The number of Soviet Jews emigrating to Is-
rael declined 42 percent last year. (Page 4)
Israel-Lebanon: A Lebanese-Israeli border clash
has occurred. (Page 5)
Israel: Israel is pumping 70 percent of its daily
oil requirements from the Sinai oil fields.
(Page 6)
West Germany: The government is encouraging pre-
emptive stock purchases of key corporations
to block Arab investments. (Page 7)
Note: Cyprus (Page 8)
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USSR
Throughout the manned
Soyuz and Salyut.space flightjprograms, electrical
and electromagnetic components have been prone to
malfunction and failure. 'The concurrent potential
for dangerous electric overloads has raised the risk
of fire..
The Salyut-1 crew that perished in 1971, when
their space capsule pressurization failed on return
to earth, had an electrical fire early in their mis-
sion. The crew, of Soyuz-16, the precursor for the
joint US-USSR manned mission, also encountered elec-
trical overloads and overheating of components dur-
ing their mission last December.
The apparent low level of Soviet preparations
for handling such problems has a direct bearing on
the safety of the joint Soyuz-Apollo project this
summer; US authorities had already taken steps to
provide additional fire-emergency training for So-
viet crews before this latest incident.
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EGYPT
President Sadat has raised the pitch
of his rhetoric to fend off Arab criti-
cism of his continued involvement in ne-
gotiations for another agreement on with-
drawal in the Sinai Peninsula.
He seems also to be signaling Israel, while
Foreign Minister Allon is in Washington, that a
Sinai withdrawal will not mean the end of Arab de-
mands on Israel.
Sadat told a Beirut newspaper interviewer yes-
terday that he "will not accept anything short of
Israeli movement on the three fronts within three
months.? The Arabic word Sadat used for "movement"
has been translated by the press as "withdrawal,"
but this word is not usually used when a pullback
of troops is clearly meant.
Sadat probably intended to be deliberately un-
clear about whether he is demanding diplomatic move-
ment on the Golan and the West Bank fronts or an
actual withdrawal of Israeli troops. There seems
no doubt, on the other hand, that as far as the
Sinai front is concerned, he does mean withdrawal.
He reiterated his now standard position that it
would be "treason" for any Arab state to refuse any
territory that Israel is willing to return.
By being deliberately vague in his meaning,
Sadat does not commit himself to anything except
diplomatic action on behalf of the other Arabs' ne-
gotiating demands, but he does let them know that
he will not conclude a unilateral final settlement
with Israel. He also reassures the Arabs, particu-
larly Syria, that he will turn his efforts to gain-
ing progress on other fronts when and if a second-
stage agreement on the Sinai is concluded.
Sadat undoubtedly intended to convey the same
message in a statement to a group of French legis-
lators earlier this week in which he linked, equally
vaguely, progress on all three fronts with a deci-
sion to extend the mandate of the UN Emergency Force
in the Sinai. The mandate expires on April 24.
(continued)
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In this connection, Sadat probably will let
the UN mandate lapse in the Sinai if there is no
satisfactory progress by late April toward an agree-
ment there. It seems unlikely, however, that he
would condition continuance of the mandate on with-
drawals, or even negotiating progress, on the other
Arab fronts. Should Egypt achieve an agreement with
Israel in the Sinai by April, a decision to allow
the mandate to expire would jeopardize that agree-
ment by removing the force that polices the disen-
gagement lines and keeps Israeli forces behind those
lines.
Sadat has recently come under increasing criti-
cism in the Arab press for again moving ahead of the
other belligerents in negotiations. The Beirut press,
particularly Palestinian and Iraqi-backed newspapers,
have picked up a month-old Israeli news report in-
dicating that Tel Aviv had asked for an Egyptian com-
mitment to a 12-year suspension of belligerency in
return for a pullback in the Sinai. Arab commenta-
tors are attacking Egypt for allegedly acquiescing
in this demand.
Sadat further emphasized his continuing commit-
ment to the Arab cause by asserting in the interview
yesterday that Egypt would "take action and inter-
vene" if Syria were attacked by Israel. This is
the most direct Egyptian statement of a readiness
to aid Syria if it comes under attack. Sadat avoided
a direct pledge to open a second front under these
circumstances, but we believe Egypt would find it
difficult to remain out of the fighting for more
than a few days.
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FOR THE PRESIDENT ONLY
USSR
The number of Soviet Jews granted per-
mission to emigrate to Israel declined 42
percent last year from the 1973 total.
According to the Dutch officials, who deal with
Soviet citizens applying for emigration to Israel,
they processed approximately 20,200 emigrants during
1974, down from 34,800 in 1973, and 31,300 in 1972--
the peak years. The number of persons emigrating to
Israel dropped sharply from the last quarter of 1973
to the first quarter of 1974, but has held steady
since last April at approximately 1,600 a month. An
additional 800 Soviet Jews emigrated directly to the
US and other Western countries last year.
The Dutch attribute the decline in emigration
partly to harassment by Soviet authorities and partly
to the growing indecision of potential applicants.
The Soviets have recently increased the bureaucratic
red tape involved in exit applications, although
threats that applicants will lose their jobs seem
to have diminished. The Dutch doubt that the pres-
ent lower levels of Jewish emigration will change.
So far, there has been no indication of what effect
Moscow's denunciation of the US-Soviet trade agree-
ment will have on the situation.
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ISRAEL-LEBANON
Lebanese forces, rather than the
fedayeen, yesterday fired on Israeli ve-
hicles and artillery positions. They
may also have shelled the Israeli bor-
der settlement of Metulla. After break-
ing off for a whiles fighting was renewed
last night.
The Lebanese action is of greater political
than military significance. It represents an at-
tempt by the Beirut government to quiet its domes-
tic critics, who, after almost a week of small
clashes along the border, are again decrying the
army's inability to stop Israeli incursions. Vil-
lagers from southern Lebanon, reportedly egged on
by communist, Baathist, and pro-fedayeen agitators,
this week attempted to occupy a district commission-
er's office to protest the government's failure to
protect them?
Beirut's inability to restrict the initiatives
of either the fedayeen or the Israelis in southern
Lebanon has been further exposed by the fedayeen's
newfound willingness to stand and fight and by the
Israelis' determination to drive them out of the
border villages. Yesterday's incident, in fact, ap-
parently began as the Israelis attempted to dislodge
some fedayeen forces from such a village?
The fedayeen for the time being appear to have
shifted from cross-border terrorism to more conven-
tional military action. This strategy apparently
is designed to throw the Israelis off balance and
win acclaim for fedaveen willingness to defend
southern Lebanon.
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Mediterranean Sea
Jerusalem
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FOR THE PRESIDENT ONLY
ISRAEL
Israel is pumping 100000 barrels
of oil per day from Sinai oil fields--a
quantity that amounts to 70 percent of
its daily requirement. In the past
three years the entire increase in
Israel's domestic oil consumption has
been met by stepped-up production from
Sinai.
Sinai oil has been a boon to Israel in view
of the rise in cost of imported oil and the in-
creased pressure made by military expenditures on
foreign exchange reserves. Oil from Sinai fields
in 1974 would have cost Israel about $400 million
at the price it paid for purchases made from Iran.
The major cost to Israel of Sinai oil is a
royalty payment, set aside to compensate an Italian
firm that has an interest in the fields. That
payment, . and other minor
foreign exchange costs, are believed to have amounted
to no more than $50 million last year.
The present rate of production in Sinai will
exhaust those fields in five to seven years. Tel
Aviv has made no significant effort in the past few
years to develop new reserves in Sinai presumably
because it views use of the Sinai fields as an ex-
pedient and because oil there is vulnerable in the
event of hostilities. Not only are the fields ex-
posed, but at present the oil must be moved by
tanker to Elat, a route easily attacked.
Israel has established a six-month reserve of
oil currently stored in aboveground facilities.
Tel Aviv is planning to build more secure under-
ground facilities that would permit storage of a
larger reserve?
Israel's sole foreign source of oil is Iran?
In addition to the $200 million worth purchased
from Iran last year for domestic consumption,
Israel processed for re-export 40,000 barrels a
day of Iranian oil. Another 600,000 barrels a
day of Iranian oil for Europe transits the Elat-
Ashcielon pipeline. Tel Aviv offers an attractive
price to Iran for this service.
Israel's confidence in Iran as a source of oil
was shaken by the Shah's recent expressions of
solidarity with the Arabs. There is no evidence,
however, that the Shah intends to stop selling oil
to Israel.
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1 WEST GERMANY
Rumors of potential takeovers by
oil producers have prompted the gov-
ernment to encourage West German banks
to make pre-emptive purchases of stocks
in key corporations.
As a result of such prompting after the
Kuwaitis purchased 14 percent of Daimler-Benz in
November, West Germany's largest commercial bank
has agreed to double its holdings by buying 29
percent more of the company. Bonn officials have
assured the public that the bank's new shares,
worth more than $800 million, will be resold
during the year to a domestic buyer. Another
bank recently made a similar move to keep a
major machine tool builder in West German hands.
Chancellor Schmidt has repeatedly said that
oil dollar investment in West Germany is welcome
as long as it does not involve a significant
share of a strategically or politically important
firm. It appears that these categories include
those financially sound, heavy industrial firms
that the oil exporters so far have shown the
most interest in purchasing.
German private business is against a proposed
law that would strengthen reporting requirements
regarding sales of stock to foreigners. Banking
and industry representatives are formulating a
code of behavior as an alternative. The recent
pre-emptive stock purchases may help to defuse
public demands for greater controls.
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NOTE
Turkish Cypriot refugees are to be evacuated
by the British from the British Akrotiri air base
in southern Cyprus beginning tomorrow.
The British are hopeful that the evacuation,
which will be carried out ?by Turkish aircraft, can
proceed without incident. Several small-scale
demonstrations by Greek Cypriots, however, have
already taken place. Greek and Greek Cypriot of-
ficials have protested the move, because the 8,000
to 9,000 refugees are one of their few bargaining
cards in the intercommunal talks. The Turkish
government ?is expected to resettle ?the evacuees in
the Turkish sector of Cyprus.
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