WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86T00608R000300020032-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 21
• Document Creation Date: December 22, 2016
• Document Release Date: March 1, 2011
• Sequence Number: 32
• Publication Date: July 18, 1975
• Content Type: SUMMARY

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Secret
Weekly Summary
Secret
No. 0029/75
July 18, 1975
Copy N! 54
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CONTENT.; (July 18, 1975)
The WEEKLY SUMMARY, Issued every Friday morring by the
Office of Current Intelligence, roporta and analyzes significant
developments of the week through noon on Thursday. It fre-
quently Includes material coordinated with or prepared by the
Office of Economic Research, the Office of Strategic
Research, the Office of Geographic and Cartographic
Research, and the Directorate of Science and Technology.
Topics requiring more comprenonsivo treatment and
therefore published separately as Special Reports are listed
it the contents.
1 Italy: Fanfani Under Fire
2 CSCE: Nearing Agreement
3 Portugal: f olitical Crisis Mounts
4 USSR-US: Criticism of Schlesinger
4 USSR-France: Chill in Relations
6 Eastern Europe: Floods and Harvest
MIDDLE
EAST AFRICA
WESTERN
HEMISPHERE
11
Comoro Islands:
Independence Declared
12
Argentina: Crisis Continui
ng
13
Peru: Nonaligned Confere
nce
14
Panama: Impatience Over
Delay
EAST ASIA
PACIFIC
16 Laos: Little Progress
ILLEGIB
25X1
18 Vietnam: Recovery Unspectacular
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Italy's Christian Democratic Party is about
to begin an internal debate that could determine
whether the party can maintain its position as
Italy's dominant political force.
The Christian Democratic national council
meeting tomorrow will discuss how to halt the
erosion of the party's strength that was revealed
by the outcome of the regional, provincial, and
municipal elections last month. The Com-
munists came close to outpolling the Christian
Democrats for the first time. Sentiment in the
120-member council has been building against
party leader Fanfani, and a move to revise his
conservative political line is likely. Fanfani says
he will not give up his job unless he is voted out
by the council. There are signs that more than a
majority of the council members are inclined to
do just that.
Prime Minister Moro is one key Christian
Democrat who has yet to break publicly with
Fanfani. Moro is still the party's most pres-
tigious left-of-center leader, and his alliance with
Fanfani h'lped protect the latter from the
attacks of the left wing as the Christian Demo-
crats suffered successive defeats during the last
two years. Moro will probably soon withdraw
his support and that would ensure Fanfini's
departure.
The Socialist Party, meanwhile, is follow-
ing a line at the regional and local levels that
differs only in phrasing from Communist chief
B erlinguer's "historic compromise" concept.
B-:rlinguer has argued since late 1973 that the
solution to the country's problems lies in
cooperation among the "popular and demo-
cratic" forces, mainly Communists, Socialists,
and Christian Democrats. The Socialists are now
calling for "open governments" at tl.e regional
and local levels, in which all parties except the
neo-fascists are invited to participate.
The invitation, however, seems mainly to
be a way of justifying the Socialists' apparent
preference for alliances with the Communists at
the local level. The moderate gains made by the
Socialists in the elections gage them the option
of linking up with the Communists or the
I!ti~,~1''r
Christian Democrats in many areas. In one such
area, the northeastern region of Liguria, the
Socialists chose last week to join a Communist-
led government rather than a center-left coali-
tion with the Christian Democrats.
The Socialists' preference for a government
with the Communists in the larger and more
industrialized region of Piedmont, however, is
more likely to provoke trouble than the
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Ligurian arrangement. Unlike Liguria, the two
parties do not quite have a majority in
Piedmont. The Socialists are inclined to set up a
minority government with the Communists in
Piedmont, despite the fact that a center-left
coalition with the Christian Democrats would
have a comfortable majority. Two members of
the Moro cabinet, whose home base is
Piedmont, are threatening to bring down the
government by resigning if the Socialists
abandon the center-left formula in that region.
In their post-elaction policies, the Com-
munists are sticking to the moderate line they
emphasized in the campaign. Communist labor
leaders, for example, were mainly responsible
for the decision last week by Italy's top labor
federation to seek maximum employment rather
than excessive wage demands in major contract
negotiations this fall. The federation's strategy
should encourage calmer and less protracted
bargaining in the fall, unless some of the
militant constituent unions refuse to go along.
Deputy Prime Minister La Malfa, a frequent
critic of labor's policies, praised the Communist-
sponsored proposals as eminently sensible.
CSCE: NEARING AGREEMENT
Participants at the European security con-
ference agreed on Monday to accept July 30 as
the opening date for a three-day summit in
Helsinki, provided that differences on all out-
standing issues are resolved by July 18. Nego-
tiators have been working furiously in Geneva
throughout the week to reach agreement on
more than a dozen issues, including military-
related confidence-building measures. Final
acceptance of the July 30 date is expected this
weekend.
On July 14, NATO members and the
Warsaw Pact states bowed to Malta's demand
that the final conference document include a
call for the eventual reduction of armed forces
in the Mediterranean region. Prime Minister
Mintoff of Malta, after dropping an earlier
demand for a phased withdrawal of thu US and
Soviet fleets from the Mediterranean, forced
acceptance of a Mediterranean declaration by
refusing-for four days-to agree or. a summit
date.
Agreement was also reached during the
week on several major issues, including follow-
on procedures for the confereni::a, principles
governing relations among states, ?ind a clause
protecting Allied rights in Germans' and Berlin.
Little progress was made, however, in meeting
Turkey's demands for a clause exempting it
from certain aspects of militeeYy-related con-
fidence-building measures.
Agreement had not been reached by mid-
week on more than a dozen other less weighty
issues, including the order of speakers at
Helsinki, trade reciprocity, and a clause extend-
ing the benefits of CSCE throughout Europe-
especially to Berlin. The EC it also insisting that
Italian Premier Moro be allowod to sign the final
act twice-acting on behalf of the EC as well as
Italy.
The Turkish demands are the only major
stumbling block to a final agreement. Influenced
by strong demarches from several NATO states,
Ankara is now showing more flexibility and has
muted its ca,! for Turkish Cypriot representa-
tion at Helsinki. On confidence-building meas-
ures, Ankara appears willing to give advance
notification of manuevers within a 250-kilo-
meter zone along its borders if the conferees will
make concessions on separate notification of
amphibious and airborne troop movements. This
compromise would include language stating that
notification need not be given n areas adjacent
to borders with non-participating states-thus
exempting manuevers in eastern and southern
Turkey.
In Helsinki, meanwhile, preparations for
the summit are proceeding at a hectic pace. The
Finns are expecting 900 delegates, accompanied
by thousands of support personne;, to attend
the 35, nation summit and have begun elaborate
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PORTUGAL: POLITICAL CRISIS MOUNTS
A crisis atmosphere continued in Lisbon
this week as the Revolutionary Council was con-
fronted with the need to form a new cabinet
and with a rising storm of protest over its efforts
to bypass the political parties. The resolution of
these questions may be largely determined by
the outcome of a power struggle now reportedly
taking place among its leading members.
The cabinet ci isis was precipitated when
the Socialist Party pulled out of the coalition
government last week because of the seizure of
the newspaper R spublica. The Socialists were
followed by the center-left Popular Democratic
Party on July 16 when the Armed Forces Move-
ment failed to meet the party's demands for a
free press, a pledge not to dissolve thc popularly
elected constituent assembly, and a promise of
prompt municipal and trade unior elections.
The Popular Democrats also demanded an end
to the present divisions within the Movement
leadership and the urgent adoption of measures
to deal with the rapidly deteriorating economic
situation.
The withdrawal of the Popular Democrats
has effectively dissolved the coalition and paves
the way for the formation of a new government.
Prime Minister Goncalves has been charged with
naming a new cabinet, and a Movement spokes-
man has said it will not be composed exclusively
of military officers. There is speculation that
non-party civilian technical experts will join the
military in the new body.
Meanwhile, the Revolutionary Council is
being subjected to increasing pressure from all
sides. At a large demonstration in Aviero last
weekend, Catholics demanded the return of the
church radio, which is occupied by pro-com-
munist workers. In Rio Maior, just north of
Lisbon, local offices of the Communist, and a
fellow-traveling party, were sacked and burned
by local farmers. On July 16, a pro-communist
demonstration-one of several held this week-
was joined by soldiers from a leftist military
unit.
Page
The firm stand taken by the non-com-
munist parties against the proposed formation
of popular councils hes been reinforced by
sizable demonstrations by the Socialist Party,
which is openly moving toward direct opposi-
tion to the Armed Forces Movement. The
Socialists have publicly denounced security
chief Otelo de Carvalho over his role in the
Republica affair and are demanding Goncalves'
resignation. Party leader Mario Soares has also
denounced the popular councils concept as a
tactic by the military to establish a communist
dictatorship and has threatened a "symbolic
paralysis" of the country if the voice of the
parties is not heeded.
There are increasing signs that these and
other vital issues-notably the threatening
economic collapse, the resumption of fighting in
Angola, and the growing impatience of the
Portuguese people and even members of the
Movement itself-may at last bring to a head the
disagreements and divisions among principal
members of the Revolutionary Council.P
25X1
In its public statements the Movement has
already begun to temporize on its plans to
bypass the parties. It has suggested that the
proposals on the popular councils do not con-
stitute an immutable law and, in any case, are to
be established over a long period. If the
moderates' move to oust Goncalves should fail,
however, another lurch to the left appears
likely. Already apprehensive., militant Socialists
have requested arms and other assistance from
the US to offset the strength of the Communist
militia and other armed radical groups. Should
the Revolutionary Council not succeed in
re-establishing its authority soon, it is possible
the situation could deteriorate into armed con-
flict. F_ I 25X1
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3 WEEKLY SUMMARY Jul 18, 75
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USSR-US: CRITICISM OF SCHLESINGER
The Soviet media have reacted sharply to
Defense Secretary Schlesinger's recent remarks
on US nuclear employment policy, con-
centrating on the political rather than the mili-
tary significance of his statements.
The most definitive response appeared in
Pravda on July 12 under the authoritative
"Observer" by-line. The article condemned the
Secretary's comments as "bellicose state-
ments...in sharp contradiction" to US-Soviet
security negotiations and to detente in general.
It said he was reverting to the "bankrupt"
strategies of the Cold War and flouting the
intent of the bilateral agreement on prevention
of nuclear war by raising the possibility that
nuclear weapons would be used in any crisis
situation. These points recall similar Soviet
criticism of the Secretary since early 1974 for
his comments on US targeting doctrine.
Soviet commentators have attempted to
explain the recent statements in terms of an
internal debate in he US over foreign policy
following the withdh?awal from Southeast Asia.
The Pravda article accused the Secretary of
being a spokesman for those hewing to the
"militarist dogmas of the past." It and other
Soviet commentaries have said that his remarks
were part of a Pentagon effort to win approval
for the US military budget.
The media have drawn liberally from US
critics of Schlesinger's comments in an effort to
show that they are counter to the mainstream of
US opinion. Nevertheless, the Soviets betrayed
some concern over the implications of his state-
ments foi~ administration policy. Noting that the
Secretary is a prominent member of the US
government, one commentator asked why this
moment was chosen for a discussion which
"certainly doesn't facilitate the course Wash-
ington professes to follow."
correspondent mildly observed that the best
reply to opponents of detente is "concrete
deeds" to improve international understanding.
Moscow's support for a successful CSCE summit
and its campaign to play up the prospect of
moving from political to military detente sug-
gest a continuing desire to pursue better rela-
tions with the US. 25X1
USSR-FRANCE: CHILL IN RELATIONS
The most recent manifestation of a "chill"
in French-Soviet relations is the vitriolic attack
by the Soviet news agency, Tass, on French
Minister of the Interior Poniatowski earlier this
month. Poniatowski was condemned for
asserting that the "Ponomarev document"
recently published in a French newspaper was
not a fraud, as claimed by the French Com-
munist Party, but a Soviet guideline tor seizure
of power by communist parties.
Moscow could hardly have ignored
Poniatowski's remarks, in view of strong Soviet
protestations that the document was a forgery
trumped up by the Portuguese Socialists to
discredit the Soviets and the Portuguese Com-
munists. The French nevertheless assume that
the Soviet attack on Giscard's closest political
associate was also a thinly veiled i nal to the
French president on other isc.!as
While clearly pe' ved, the Soviet; have not
Used the Secretary's statements to cal' publicly
for greater defense efforts of their own. One
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Jul 18, 75
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The
Soviets fear that an agreement on Pluton could
enhance the prospects for an independent
European defense, which Moscow strongly
opposes. Moscow may have viewed its blast at
Poniatowski as an opportunity to weigh in with
Giscard prior to the French - West German
summit meeting at the end of this mcnth.
Paris and Bonn continue to deny that there
are plans for stationing Plutons in West
Germany, although the French and West
German military planners are probably making
contingency plans to use the Pluton in the event
of hostilities.
Giscard has already shown he is aware of
Soviet concerns in this area. Last May, he
sympathized with Soviet fears of an
independent European defense arrangement and
suggested the problem not be addressed until
more political unification has been achieved. His
statement was widely criticized in France as a
concession to the Soviets.
French-Soviet relations have suffered
other, more minor irritants in the ast two
months. the
irritants include Giscard's termination of V-E
Day celebrations in France and his visit to
Poland in mid-June. The Soviets were dlso
annoyed by the several strong attacks on the
USSR made by Chinese Vice Premier Teng
Hsiao-Ping during his visit to Paris in mid-May.
1'rarda took French Prime Minister Chirac to
task for expressing satisfaction with the visit.
25X1
Pluton missile passes review stand during Bastille Day parade
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EASTERN EUROPE: FLOODS AND HARVEST
Early tl'?is month, heavy rains and flooding
hit Eastern Europe and Yugoslavia at the start
of the harvest season, causing major losses of
grains and other crops. By contrast, the grain
crop in East Germany is in trouble because of
severe drought.
Eastern Europe had been headed for an
excellent harvest. In mid-June, grain output,
including that of Yugoslavia, was forecast at
about 95 million tons, almost 6 percent greater
than in 1974. Based on early weather damage
reports, grain losses of roughly 9 million tons
are now likely. Losses may run higher if the
riskig Danube causes more flooding in Romania.
Flood waters have receded in Czechoslo-
vakia, Hungary, and Yugoslavia. So far, the
number of fatalities is unknown; Romania
reported that 60 persons died. Although
thousands of persons were evacuated in rural
areas, major urban centers reportedly sustained
little damage, and the floods caused only minor
disruption to industry.
Romania Hardest Hit
According to the minister of agriculture
total grain !oss is expected to reach about 1.5
million tons--equal to more than 10 percent of
last year's harvest. In addition, significant losses
of sugar beets, potatoes, vegetables, fruit, and
livestock have occurred.
Romania has appealed for emergency US
disaster relief. At least 200,000 tons of feed
grain is needed, much of which Bucharest hopes
to receive as an outright grant. Requests for
construction and industrial raw materials also
were made, although the need for them is less
acute. In the longer term, Bucharest wants low-
interest credits to finance necessary imports and
to expand exports. As in 1970, Bucharest may
be exaggerating its claims of destruction in
hopes of getting as much assistance as possible.
Page
Requests also have been made to world
food agencies. Bucharest, in fact, appears to be
looking mainly to the West-and not to its East
European allies-to supply the bulk of materials
needed for recovery.
I n addition to the US. Romania has
approached West Germany, France, the UK,
Italy and Belgium for debt rescheduling, credits,
and assistance in easing EC import quotas, as
well as outright grants. Romania's CEMA
partners are unlikely to provide aid. Five years
ago, Peking was the most generous benefacior
and Moscow provided only belated token
assistance.
Other Countries Less Damaged
Other than in Romania, damage from
storms and localized flooding was probably the
most severe in Yugoslavia. In Vojvodina and
Slavonia-Yugoslavia's bread basket, flanking
th-, Danube and Drava rivers-emergency har-
vesting has been delayed by rain and strong
winds. Early estimates project wheat 'osses at 1
million tons, about one fifth of the expected
crop. Losses of other crops may also be high.
The level of the Danube has fallen in
Czechoslovakia and Hungary. Although flooding
caused some crop losses in Czechoslovakia, most
damage to grains will come from lodging. In
Hungary, the harvest had just begun when the
rains came. About one quarter of a million acres
were reported flooded by July 8, mainly along
the Danube and Tisza rivers. Over one halt of
the flooded land was sown to corn.
In stark contrast to flooding elsewhere, a
two-month-old drought endangers the grain crop
in East Germany. The northern and central
countries have suffered the most with only trace
amounts of rain falling in some areas. Weather
data for the first 10 days of July indicate that
the major grain producing area in the south is
also drying up. Emergency harvestin has started
in 6 of 15 counties.
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6 WEEKLY SUMMARY
Jul 18, 75
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ANGOLA: ANOTHER ROUND
After almost a week of intense fighting in
Luanda, the Popular Movement for the Libera-
tion of Angola forced the rival National Front
for the Liberation of Angola to withdraw from
the city. The latest round o' clashes may also
have destroyed the territory's fragile six-month-
old transitional government-a development that
could seriously disrupt Lisbon's decolonization
program for Angola.
With the fighting in the capital going
against the Front, its senior representative in the
transitional government, Johnny Eduardo
Pinnock, and a number of other Front officials
fled to the organization's headquarters in Zaire.
In a subsequent press conference in Kinshasa,
Pinnock announced that he was resigning from
his position. He also claimed that the Popular
Movement is now controlled by "extremists"
who have pushed aside the group's long-time
leader, Agostinho Neto.
Pinnock's resignation, which carried an
assertion that the National Front is mobilizing
for full-scale war, was probably design ad in large
part to prod the Portuguese into imposing a
tru..e through force of arms. Such a truce may
be the Front's only chance to pull itself
together. With the exception of a few small
garrisons scattered around the environs of
Luanda, the Front is now isolated in its tribal
base in northwestern Angola, separated from the
capital by territory controlled by the Popular
Movement. It is probably low on arms and sup-
piies and in no position to wage sustained war at
the present time.
The military rulers in Lisbon, who have
considerable prestige invested in their effort to
lead Angola to independence next November,
will probably try to convince the National Front
to return to the government. The Front is
unlikely to return unless the Portuguese can
guarantee peace in the territory, at least until
national elections can be held. It is probably too
late for that, however. Although some 24,000
Portuguese troops remain in the territory, there
is a real danger they would refuse to intervene
between the two hostile liberation groups.
Agostinho Neto
Moreover, troops in Portugal might well refuse
to go to Angola at this juncture.
Portuguese Foreign Minister Antunes, who
made a quick visit to Luanda during the height
of the fighting, was unable to arrange a cease-
fire. He subsequently informed UN Secretary
General Waldheim that Lisbon may have to take
"emergency measures" in the territory. Antunes
hinted last Sunday night prior to his departure
for Luanda that Lisbon might have to appeal to
the UN in order to protect the decolonization
process.
Whatever the Portuguese and the National
Front may have in mind, the Popular Movement
appears determined to score a military victory
against its competitors, including the National
Union for the Total Independence of Angola,
the smallest of the three liberation groups. The
National Union has refused to take sides in the
fighting between its larger rivals but on several
occasions has been attacked by the Popular
Movement. 25X1
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Independence Declared
One of the final rounds in the breakup of
France's once extensive o"mrseas empire is being
played out on the Co,noro archipelago in the
Mozambique channel. The legislature of the
Comoro Islands declared the islands inde-
pendent on July 6. The status of one island-
Mayotte-is still in doubt, however; its inhabi-
tants want to remain part of France.
The islands are a major source of the base
essence used by the French perfume industry
and have had a large measure of internal self-
governmeni since 1961. Independence was
abruptly declared by the Comorian government
to counter the effect of a bill passed in late June
by the French National Assembly. The bill pro-
vided for the independence of the archipelago
later this year, but allowed each of the islands to
vote separately on a proposed independence
constitution. This would have permitted the
Mahorais-the inhabitants of Mayotte-to end
their association with the other islands and
make Mayotte a French department.
In a referendum last December, over 60
percent of the Mahorais opted to retain links
with France, while the people on the other three
islands voted overwhelmingly in favor of inde-
pendence. There is heavy French and Christian
influence in the Mahorais' culture, in contrast to
the Muslim culture that is predominant on the
other islands. Mayotte political leaders de-
nounced the independence declaration as illegal,
and are demanding that France maintain its
authority on the island. Ahmed Abdallah, the
new chief of state, has vowed to keep Mayotte a
part of the Comoros.
Paris Seeks Middle Ground
Paris is willing to accept the Comoros' in-
dependence, but it is keeping its options open
regarding Mayotte. The government issued a
communique this week saying it would "take
into account" the wishes of the Mahorais, but it
did not explicitly support Mayotte separatism.
France has agreed to withdraw. its troops and
civil servants from all the islands except May-
otte. Pars is trying to locate a middle ground
between Moroni-the Comorian capital-and
Mayotte, but it will not be easy.
France is concerned that retaining Mayotte
will subject Paris to charges of attempting to
perpetuate a colonial arrangement, in order to
ensure France a military presence in the Indian
Ocean. France is already under increasing criti-
cism from V can and Arab countries because
of its continuing hold on the French Territory
of Afars and Issas.
Relations between the Comorian govern-
ment and France will be strained if Paris finally
agrees to retain Mayotte. The Comorians might
refrain from an open break because of their
reliance on French aid. A cooling of relations,
however, would probably encourage the Ce-
morians to seek assistance from Muslim
countries.
Libya has shown an interest in the islands;
several delegations have visited the Cc'rloros,
and Abdallah visited Tripoli in March. Saudi
Arabia may provide some aid to prevent the
islands from falling under radical Arab influ-
ence. Iran may also be willing to help.
~.'Aozan~lque ISLANDS
r0 Miles 200
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ARGENTINA: CRISIS CONTINUING
President Peron has been seriously weak-
ened by political and economic setbacks during
the past two weeks, and there are no indications
that anyone within the government is capable of
halting her deteriorating position.
Lopez Rega has been ousted from his offi-
cial posts and has moved out of the presidential
residence, but it is widely believed that hr, is still
advising Mrs. Peron. Military, labor, and Peronist
political leaders will continue to urge the Presi-
dent to end his influence.
The crisis is likely to be protracted. Lopez
Rega's opponents stid would prefer that Mrs.
Peron remain in the presidercy, and they seem
content for the time being to wait for her to
make the next move. They now appear prepared
to accept her resignation, or even force her
ouster, however, if she insists on retaining him-
even in an unofficial capacity.l
The prospects for an orderly transfer of
power, in the event that Mrs. Peron does step
aside, improved considerably this week with the
election of a moderate Peronist, Italo Luder, to
fill the Senate's provisional presidency. Luder,
who is first in the line of succession, is a re-
spected constitutional lawyer and academician
and is well regarded in most political circles.
The government has not been able to form-
ulate proposals for dealing with the worsening
economic situation that are politically accept-
able to labor. Ministe.- of Economy Rodrigo, a
protege of Lopez Rega, is continuing to push
President Peron swears in Carlos Villone as Social Welfare Minister, replacing Lopez Rega.
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SECRET
most of the economic austerity program he out-
lined on June 30. He is totally discredited, how-
ever, and may soon be forced to resign. Strikes
and work stoppages are occurring daily in vari-
ous cities as concern grows that even the recent,
massive wage hikes soon will be eaten up by
soaring inflation. Moreover, leftists within the
labor movement are seeking to exploit the cur-
rent tension and widen the gulf between
workers and their top leaders. Some unions are
jealous because their wage increases did not
match those of other unions.
Though there is no evidence of active plot-
ting against the government, the likelihood of
Mrs. Peron remaining in office until the election
in 1977 has diminished considerably. By cling-
ing to the hated Lopez Rega, the President has
alienated labor and Peronist political leaders A a
time when economic problems have reached
crisis proportions. The economy alone wound
have severely taxed the skills of a strong, char;s-
matic leader. Since Mrs. Peron is neither, the
added problems caused by her association with
Lopez Rega may be more than she can handle.
PERU: NONALIGNED CONFERENCE
Latin America will provide the dais for the
next rhetorical attack on imperialism by the
nonaligned conference. As the region has shifted
away from the US toward the Third world, it
has produced a rotating leadership among the
more aggressive proponents of an international
reformation. Venezuela, Mexico, and Peru en-
gage in an active but friendly competition for
the global spotlight as spokesmen for the area.
The first two will share stardom as launchers of
a new regional organization, a Latin American
Economic System, probably at the beginning of
August. Then Peru will take its turn, as host for
the foreign ministers conference of the non-
aligned on August 25-29.
The Lima site for the meeting underlines
the growing case with which the Latins play the
Third World role. Only a few years ago, the
Latins saw little common ground with the gen-
erally less developed Asian and African regions
and shied away from communist regimes. In
1970, Cuba was the sole full-fledged member of
the non,;ligned conference. By 1973, seven Latin
and Caribbean nations attended the summit at
Algiers as full members; eight went as observers;
one was "present." Now the Latins are often
instigators of Third World issues in the UN and
other world forums, especially on economic
matters.
Venezuela and Mexico have been particu-
larly agile at maintaining are ambidextrous for-
eign policy that allows for a productive and
cordial relationship with the US and at the same
time strengthens their place with the lesser de-
veloped. Peru had begun to bend somewhat
away from its more clearly adversary role vis-a-
vis the US, but the interest of moderates in the
Peruvian leadership in easing tensions with
Washington will not put a brake on Lima's in-
dulgence in Third Worldism.
The minority of Latir states that hew un-
abashedly to a pro-US position continues to
shrink. Even the Somoza government in Nicara-
gua has begun to examine ways to exhibit dif-
ferences with Washington in order to avoid isola-
tion from the mainstream of Latin America.
The Lima conference, coming immediately
prior to the opening of the 7th Special Session
of the United Nations, will be the major point
of coordination for the Third World positions at
New York Many contentious issues will be
topical, and sources of friction and division
amr,og the nonaligned continue to be many.
Cuba, for example, has already attacked the oil
producers as a budding new privileged minority.
The pressure for unity nevertheless remains
powerful, and will probably be further strength-
ened as the group begins to react to recent
warnings from Washington about its role in the
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Panamanian leader General Omar -IorIijos
laying the groundwork for a campaign to
r ,tmonstrate his frustration about file delay in
negotiations on a new canal treaty. -1 orrijos told
student leaders on July 9 that he no longer felt
bound to preserve the confidentiality of the
talks because the US government had breached
the secrecy agreement. He thus left the door
open to release those facts that would increase
pubiic support of his canal stand.
The briefing for the students, the first in
series of meetings Torrijos intends to hold will
various groups, is probably intended to signal his
annoyance at the lack of recent progress i i the
t.ilks, the indications of opposition to the
negotiations by members of the US Cong-ess,
and tho pessimistic articles in the US press about
the future of the talks. In statements to the
press in early July, - ,irrijos declared: "When all
peaceful ?,ultrlirrn?, doll! r.lnserl Io ,r (Dually, than
it nncl result Io snltrtinrn', Ihat art' lint I)l's((,.
I he I'ananrsnian Iesder is also con(,enred
about rising (.1ilir isnr at burnt' of Ill-, landlmg r t
Ihr! nr.gntialinrrs, Ile! l,c, raised r!xIm(.1,rhon?, loll
an ,ulvitnt,rrlentr?, Ire,rly within a fairly short lime
h,une 'Ind feel', compelled to produce 1 our Tale
resells, /\ prolonged delay, Ile fear',, will piovitle
ammurrilion to critic" .]fill weaken Irnirrrl,u sep-
porl fur his rruJinre.
/ \ c c u r d i 1)(I I o I I r e I) r rr - (lover n rnen t
I'arrun,urisn `itntle,it I e(Iernlion, tiro adnrinisha-
lion is alre,r(ly taking ',evernl steps to hulsler its
caural negotiating position. I he (rlr ntii of r
(li,llorlue with v,rrion', sec.lnrs of the "o( JOY i?,
the first move. In the international anent, lh('re
will he even snore entplasi?, nn e'Lthlisling
diplomatic relation'. will all (ounlrres (ill(-
USSIt ,lull China (1)1(1(1 (.time soon) ,uul
strengtlerting ties will Ilird World (ounirres.
At ill(! UN, of for t,, will he n( leased to assure
I'rrn,rrn,r a sect on the Security C:1)lrncil, and site
c,eral issue will he submitted to till! General
Assembly.
Although for the present 11)( r ij1); nt,ty he
leaning toward till,, fairly niodcr,tte come,,'. Inc
may decide relatively soon ll,rl lc should (live
Washington a preview of what to expect if a new
leafy is not sit~oed. IIe (ouid choose to trsc
carefully controlled student demurs lations,
perhaps involving minor h,rr,rssment of US
citizen's, to ?lentonshate i'ananut's unhappiness
with the present situation.
At least initially, Iorrijos would consider
such actions a necessary tactical nterve,uul riot a
reversal of his view that negoti-rhon is the best
way to achieve Panama's canal goals. If these
actions failed to produce forward nruvement, 1111
could rapidly marshal students acrd ether groups
for more serious demonstrations that could
eventually leach to a confrontatio'i.
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t hr, L,r,r hive curnnritterl n r nww nu?,r hmf
rtt,un,t US f,rt.ilitic", III Vic?nti,rnr ?inrc deft n-
~tr.rtru~, ,uul truulr-, nrnvctf into %('VeldI I_ISIS
f,:r iIII , nc,nly IIrrrr? wr?rb,??intr. ttlt, Irrngic",,
huwcvI r , r, being nr,rtfe tovml if r r",ulvnrg ',t'ver,rl
tiff f it ult I>rt,hlerns.
Students ,uul police still occupy two US
cunrlxrun':Is in the Capital, and government
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,ICI-11-11t 1
"Ilrcial', refused to rehnfl norr-11S/\II) Ili olrerIy
',eized by the clenronshalcn',. Iflrrrf', to rcr,olve
rl0Ui,11rrl', fill lernrin,rlion salary by national air-
line. errrlrl(ycrr!', a(fucled by the ',nd of /All) r.un-
iracls renrairr dearllockecl, de',Irite talk', between
the US c.hnrcle mitt I'rinre Mini',ter Sutiv,rrnuti
I'hnunra as wall it,, other ranking officials, In ,r
relatively nrinol conc:cr,siorr, I_.ru boobs on July
15 turned Over the USIS wnrehuu',e Ii) US con-
trol. All USI`-7 inslallalions have flow been re-
tillned to the UJS,
IIll ee Irarcl Iine crnnnrurri',t r,rinister?,,
recently arrived from Sara Neon, have taken till
their dutie', in Vientiane to rr:hl,rco rel,itively
nuxlerate cotrirtruni',t rnini',ler', l)l,icecl on sick
leave. f'hoomt 5ilrra,culh, who is by f,n the
hi(lhe',t ranking of the trio a', ictinq delxrty
Ininle minister and foreign rrtini',ler, will Irre-
stnn,rbly have, direct charge of ,)Il fuhne nego-
tiation; with t.re US. f'hotnte proved tough and
inflexible clurinq the lengthy talk', that tell to
the Lao peace ,igieernent',.
1 he l_ao are iust beginning to realize-
apparently with some ',hock -that they will not
receive further aid. The cornniurri'ts so far have
offered no signs on whether they will accept
continued diplomatic relations in the absence of
new US aid. On July 11 the Lao government
formally asked for a bevinnin of tie otiations
on a new rid ac reernent.
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I lanoi has had hotter than two years since
the signing of the r:oaso-fire arrangemonts in
South Violnain to rebuild the economy o'
North Viotnarn. Over,rlI growth (luring 1973 and
1974 was unspectacular, and clearly less than
11anoi had hoped. Moreover, the take-over of
South Vietnam is complicating plans for
development of the Nor ', over the next few
years.
of investment and muddled policies. Rice yields
,ire still among the lowest in Asia, attributable
to insufficient irrigation, water-control facilities,
farm niachinery, and high quality fertilizers.
LZice output sta(]natod in 1973 as adverse
weather (lantaged the autumn harvest, but last
year output was up 10 percent touter favorable
growing conditions.
After lire cease-fire, I-lanoi rapidly restored
the bomb-clamagecl transportation, electric
power, and small modern industrial sectors, its
priority objectives. Transport activity increased
its roads iind bridges were repaired. Reconstruc-
tion of the Thac 13a hydroelectric power plant,
the Uonq 13i and Thai Nguyen thernial power
plants and construction of it new thermal plant
at Ninth Binh restored nearly all of the electric
power capacity that existed before the bomb-
ings; 75 percent had been knocked out in 1972.
The reconstruction effort as it whole, however,
was makeshift and shoddy.
There were some gains in production in
1974, but attempts to restore output to pro-war
levels in iron and steel, cement, chemical
fertilizers, arid coal were only partially success-
ful. Extensive damage surveys and shortages of
electric power, fuel, and raw materials and
technical skills combined to delay the start of
reconstruction.
Output from light industry and handi-
crifts--wiich except for textiles emerged from
the bombing relatively free of direct damage--
erew moderately with the improvement in
transportation facilities, raw material supplies,
and electric power availability. Repairs to
damaged textile plants, including those at Nam
Dinh and Haiphong, and construction of new
ones probably restored most of the country's
textile production capacity.
Agriculture still dominates the economy,
accounting for 35-40 percent of national output
and employing 70 pc--cent of the civilian labor
force, but this sector has lagged because of lack
I lanoi has leaned heavily on its communist
allies for commodity and capital assistance. Aid
jumped f;-om $425 million in 1972 to about
$600 million in 1973 and then to $1.2 billion in
1974.
Last December, Hanoi adopted an
ambitious 20-percent target for economic
growth in 1975, but this now appears unattain-
able even though substantial industrial growth
can be expected as restoration and expansion of
large plants are complete(]. I-li;noi simply (lid not
anticipate the military take-over of the South in
April, which has forced the North to focus
attention on improving security, administering
the government, and reviving the economy in
the South.
Growth prospects beyond the next year or
so are likely to get worse before they get better,
despite a large labor force and relatively
abundant natural resources. North Vietnam
lacks the management sk;;';, technical compe-
tence, and incentives to grow quickly. The
transition to economic integration of the North
with the South will require major adjustments in
Hanoi's investment, production, and distribu-
tion plans. For this reason, Hanoi scrapped its
earlier 1976-80 five-year plan and will probably
replace it with a new one that will scale down
economic targets in the North in order to devote
some resources to socialization of the South's
economy. Finally, Hanoi probably cannot count
on receiving as much foreign aid as in the past,
since the USSR and East European countries are
insisfir,g on closer supervision of aid flows in the
future than they did during the war. j
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