SOVIET UNION EASTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001200340002-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 12, 2016
• Document Release Date: June 5, 2001
• Sequence Number: 2
• Publication Date: June 30, 1975
• Content Type: NOTES

C',
Approved For Release 2001/08/08 : CIA-RDP79T00865A0012003400 -1
secret
No Foreign Dissem
(5ff~TT Kunlu~N,
Soviet Union
Eastern Europe
Handle via COMINT Channels
Secret
?.35
June 30, 1975
SC No. 00456/75
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 Approved For Releiigb # O84-BOA DP79T00865A001200340002-1
Background Use Only/Controlled Dissem
Warning Notice
Sensitive Intelligence Sources and Methods Involved
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Classified by 005827
Exempt from general declassification schedule
of E. 0. 11652, exemption category:
? 56 (1), (2), and (3)
Automatically declassified
on: Date Impossible to Determine
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SECRET SPOKE
This publication is prepared for regional specialists in the Washington com-
munity by the USSR - Eastern Europe Division, Office of Current Intel-
ligence, with occasional contributions from other offices within the
Directorate of Intelligence. Comments and queries are welcome. They should
be directed to the authors of the individual articles.
June 30, 1975
Gromyko Ends Visit to Italy. . . . . . . . . . . 1
Hungarian Price Increases Predicted. . . . . . . 4
PUBLICATION OF INTEREST . . . . . . . . . . . . . 6
SECRET SPOKE
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 Approved For Release 2001iF/UR.I-RBP I 65A001200340002-1
Gromyko Ends Visit to Italy
Soviet Foreign Minister Gromyko returned home
on Sunday after a three-day visit to Italy.
Gromyko did not seem totally satisfied with his
talks with the Italian leaders. At a press confer-
ence at the end of his trip, he expressed some dis-
satisfaction over the pace of Soviet-Italian politi-
cal rapprochement. He also made some veiled remarks
warning against delays in convening the European se-
curity summit.. This suggests that the Italians were
not ready to pull their forelocks for their Soviet
guest.
No mention was made of a visit by Soviet party
chief Brezhnev to Italy this year, but a fall visit
by President Leone to the USSR was announced, and
an invitation was extended to Foreign Minister Rumor.
Gromyko signed a number of minor technical coopera-
tion agreements.
Gromyko also talked with Communist party chief
Berlinguer. Presumably the two men had the Italian
political scene much on their minds, but protocol
and propriety required that they say only that they
had discussed the international situation. (UNCLAS-
SIFIED)
June 30, 1975
SECRET SPOKE
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Hungarian Price Increases Predicted
Budapest will announce an increase in consumer
rices of more than 10 percent in August,
sumably limited to those from the West--would fol-
low in short order.
Party chief Kadar telegraphed at least some
increase in the consumer price level in a tough
election speech in June. The speech was larded
with references to slower economic growth and smaller
improvements in living standards, and Kadar stated
that the population was "not sufficiently aware" of
the real cost of the goods in the domestic market
place.
The resource-poor Hungarian economy has been
severely strained by higher prices for both Western
and Soviet oil and raw materials, and by shrinking
Western markets. On the heels of a record $700-
million deficit with the West last year, exports in
the first four months of 1975 slumped 8 percent be-
low the same period last year.
Despite some trimming of purchases on consumer
goods this year, imports from the West increased by
25 percent. As a result, the trade deficit with
the West reached $400 million for January-April,
compared with $200 million for the same period last
year. The rapidly escalating deficit apparently
has sparked a high-level debate since early this
year over how much to cut back the growth of West-
ern imports.
Maintaining relatively stable prices has be-
come increasingly incompatible with efforts to have
consumer prices reflect real costs. The economic
June 30, 1975
SECRET SPOKE
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GT SP
reform has permitted an inflation rate of 2-3 per-
cent a year since 1968 as part of a deliberate ef-
fort to expose the domestic economy to world economic
forces. When import prices from the West rose 40
percent last year, however, budget authorities had
to step in with massive price subsidies to keep the
rise in the consumer price level to only 2 percent.
Budapest is likely to soften the impact of any
price increases by granting some wage and welfare
benefits. The effective date of the increases may
be delayed until the beginning of the next five-year
plan in January so that the leadership will have an
opportunity to justify its decision and to assess
public reaction before the price hikes take effect,
(CONFIDENTIAL NO FOREIGN DISSEM/NO DISSEM ABROAD/
BACKGROUND USE ONLY)
June 30, 1975
SECRET SPOKE
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PUBLICATION OF INTEREST
June 30, 1975
SECRET SPOKE
Approved For Release 2001/08/08: CIA-RDP79TO086
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Secret
Secret
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01200340002-1