SOVIET UNION EASTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001300170001-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 12, 2016
• Document Release Date: June 21, 2001
• Sequence Number: 1
• Publication Date: July 8, 1975
• Content Type: NOTES

fv'
Approved For Release 2001/08/08 : CIA-RDP79T00865A001300~7Q~O~+QQcret
N11 oUUFore.?iiggnn Dissem
Soviet Union
Eastern Europe
Top Secret
July 8, 1975
SC No. 00462/75
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
 Approved For ReIea;@1bdf'/ft i : fM F'/7'%T00865A001300170001-0
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:
? 5B (1), (2), and (3)
Automatically declassified
on: Date Impossible to Determine
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
 Approved For Rsp1$8,I,CIP9A00865A001300170001-0
SOVIET UNION - EASTERN EUROPE
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.
July 8, 1975
Yugoslavs Rankled Over Slow Progress
on Western Arms Seals . . . . . . . . . . . . 1
USSR Studies Joint Economic Ventures . . . . . . 3
Soviets Lukewarm on Indian Ocean
Arms Control . . . . . . . . . . . . . . . . . 4
Bulgaria-Greece: Prime Minister
Karamanlis Visits Sofia . . . . . . . . . . . 5
1975 Romanian-Chinese Trade . . . . . . . . . . 7
Soviet Visitor Highlights During June . . . . . 8
Approved For RXeQs 2'9919 TCIW- 40865A001300170001-0
 Approved For Re"T2ffft IP kT~0865A001300170001-0
Yugoslavs Rankled Over Slow Progress
on Western Arms Deals
The Yugoslav military is showing signs of in-
creasing frustration over the meager results of its
efforts to procure modern weapons in the West and
its consequent dependence on Soviet weaponry.
Yugoslav Defense Minister Ljubicic took pains to
stress that the delivery of modern Soviet arms to
Yugoslavia earlier this year has not allayed Belgrade's
wariness of Moscow or lessened its desire to expand
military cooperation with Western countries.
Ljubicic was also eager to spike speculation that
the new arms deal with Moscow signified a closer mil-
itary link with the Soviets. Although he admitted
that there are a "few" Soviet technicians in Yugo-
slavia to help assemble the new equipment, he insisted
that no close Soviet contact with operational units
is permitted. Ljubicic rejected suggestions that
the 1974 naval repair law was tailored to give the
Soviets a naval "presence" in the Adriatic and re-
iterated his standing invitation for US naval vessels
to take advantage of the repair facilities.
Ljubicic sought to counter US fears that classi-
fied material might find its way into Soviet hands.
He declared that the Yugoslavs are "fully capable of
protecting the means of their independence," and
maintained that the civilian, not the military, sec-
tor was responsible for any diversions of restricted
technology to the East in recent years.
The defense minister stressed the same themes
during a July 7 speech to veterans in Serbia. He
complained that foreign governments verbally support
Yugoslavia's independence but nonetheless impose
limitations on arms sales to Belgrade and make eco-
nomic difficulties for Yugoslavia. He stressed that
"if what they say were true, they would show it in
deeds not words."
July 8, 1975
Approved For ReIeTsQV0ct
1prr
4-C7A-RD m
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
TOP SECRET UMBRA
Despite his interest in Western arms, Ljubicic
is concerned over their high cost. Belgrade's plans
to install a French-made surface-to-surface naval
missile on a new patrol boat were recently scrapped
because the French system was too expensive. The
Soviets are reportedly going to furnish a less-
desirable--but cheaper--missile.
Ljubicic, who began a four-day visit to London
yesterday, reportedly will close a modest $10-million
deal for British military equipment. If he is suc-
cessful, the Yugoslavs will undoubtedly hail the
deal as evidence that they are not wholly dependent
on the USSR for sophisticated equipment. (SECRET
NO FOREIGN DISSEM/BACKGROUND USE ONLY)
July 8, 1975
Approved For Releas1e31ffRUW5A001300170001-0
 Approved For Rely ?2gAf-eK1V. IAf TX0865A001300170001-0
USSR Studies Joint Economic Ventures
The Institute of the USA and Canada has completed
a study of the feasibility of joint ventures in the
USSR with foreign firms, according to information're-
ceived by the US embassy. The study apparently rec-
ommends that the USSR enter into such ventures "as
soon as possible," but that foreign partners not be
allowed to become "holders of property" in the country.
This restriction is an indication of the consid-
erable problems that still stand in the way of such
projects. On the ideological side, it is difficult
to reconcile foreign equity holdings with Marxist
dogma that all means of production should be held
solely by the state. On the practical side, a key
problem relates to the management role of a foreign
partner in running a Soviet enterprise.
The fact that serious study of the issue has been
ordered, however, does indicate some high-level in-
terest in, if not support for, such an innovation.
There is some corroboration of this interest in the
remarks of a Romanian embassy officer. He claims that
middle-level economists and planners in the Soviet
Union have been ordered "from above" to conduct an
"intensive" investigation into the Romanian experi-
ence with joint ventures with a view to possible ap-
plication in the USSR. The Romanian reports that
enthusiasm is exceptionally high at the middle-level
of officialdom, but that ideological objections at
"the political level" will prevent innovation in the
near or medium term. (CONFIDENTIAL)
July 8, 1975
TOP SES81 T iAJ F ? A p p r o v e d For Release 2001 : CI 0865A001300170001-0
 Approved For RelefO0--7Bkpk865A001300170001-0
Soviets Lukewarm on Indian Ocean Arms Control
The US senatorial delegation that visited Moscow
last week did not get very far in attempts to sound
out Soviet attitudes toward joint US-Soviet naval
limitations in the Indian Ocean. Soviet officials,
clearly caught off guard, responded with platitudes
about the USSR's willingness to negotiate, but
added that the negotiations must take into account
the views of other interested parties. Party Secre-
tary Ponomarev listed more general Soviet arms con-
trol proposals dating back to 1946, and accused the
US of trying to justify a huge arms buildup just be-
cause the USSR sailed into the Indian Ocean. The
head of the USA Institute, G. Arbatov, suggested that
the talks might begin with Moscow's proposal for
banning nuclear-armed ships from the Mediterranean--
clearly a non-starter. Two days later, Arbatov ap-
proached Senator Hart to correct what he said was
perhaps a misunderstanding of the Soviet position.
Arbatov said that the USSR was "of course" interested
in talking to the US about limiting naval deployments
and implied that these talks should be bilateral.
Arbatov's "correction" is probably nothing more
than an effort to persuade the Senators to disapprove
appropriations for an expanded base at Diego Garcia.
If the Soviets have some genuine interest in limiting
the US-Soviet naval competition, it is clear that they
were not prepared to push the idea with the Senators.
(CONFIDENTIAL NO FOREIGN DISSEM/BACKGROUND USE ONLY)
July 8, 1975
TOP SECRET UMBRA
Approved For Release 2001/08/08 : CIA-RDP79T0 865A001300170001-0
 Approved For Release 2001/08/08 : CIA-RDP79T00865A001300170001-0
TOP SECRET UMBRA
Bulgaria-Greece:
Prime Minister Karamanlis Visits Sofia
Athens and Sofia are both pleased with the visit
of Prime Minister Karamanlis to
Bulgaria
from
July
2
to 4, but they apparently hold
Balkan cooperation.
differing
views
on
Sofia favors a bilateral approach concentrating
on economic projects, but Athens is evidently push-
ing a form of multilateral cooperation that carries
political overtones aimed at isolating Ankara. Bul-
garian party chief Zhivkov underscored this differ-
ence when he reiterated Sofia's desires for "good
neighborly" bilateral relations with all Balkan states,
but avoided endorsing any multilateral political ar-
rangements. Zhivkov said that Bulgaria would partici-
pate in such "safe" multilateral areas as tourism,
science, culture, and athletics. In contrast, Kara-
manlis pointedly stressed the need for a "network of
creative cooperation."
Despite their differences, the two leaders were
able to find some common ground. They took identical
positions on Cyprus--thereby contributing to Turkey's
further isolation--and both called for a speedy con-
vocation of the final phase of the European security
talks.
According to Bulgarian press reports--which may
have been selectively edited--the Greek leader appar-
ently took time out from the discussions to poke a
few public jabs at the Yugoslavs. Belgrade was dis-
inclined to go along with the schemes for Balkan co-
operation that Karamanlis put forward during a visit
last month (Staff Notes, June 18). In an oblique ref-
erence to Greece's own historical dispute with Bul-
garia over the Macedonian question, Karamanlis said
that neither territorial claims nor minority problems
July 8, 1975
-5-
Approved For Re 10BEW 'EIAU~ ft#865A001300170001-0
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
TOP SECRET UMBRA
hamper Greek-Bulgarian relations. The implication
was that Greek-Bulgarian relations have transcended
the historical differences which still hinder rela-
tions between Sofia and Belgrade. Athens has thus
far not reported the remarks. (CONFIDENTIAL)
25X1A
July 8, 1975
Approved For ReW10g$TIARAD865A001300170001-0
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
TOP SECRET UMBRA
1975 Romanian-Chinese Trade
Trade between Romania and China will total $320
million this year
This is nearly 30 percent
ig er an the amount ca ed for by the 1974 trade
agreement. The expansion of trade reflects Romania's
desire to import raw materials, semifinished goods,
and foodstuffs at lower prices than it must pay its
Western trading partners. Peking, which imports
machine tools, vehicles, and marine and drilling
equipment from Romania, is interested in increased
trade largely because it wants to expand its in-
fluence in the Balkans.
Romania's trade with China between 1971 and 1973
grew at an average annual rate of 8 percent, while
its trade with all countries increased by 19 percent.
Romania ran a deficit of $7.5 million with China in
1973. Although official data have not yet been re-
leased, a similar deficit is likely for 1974.
A greater volume of goods, rather than higher
prices, will probably account for most of the in-
creased trade this year. In 1971, the two countries
concluded a trade agreement for 1972-75 which provided
for trading at "stopped prices." The Chinese recently
indicated, however, that higher prices will be applied
to some goods.
Despite the growth of bilateral trade, China will
remain one of Romania's less important trading partners,
accounting for only some 4 percent of total trade.
The USSR remains Romania's single most important trading
partner, with 1974 trade at $1.6 billion. (CONFIDENTIAL)
July 8, 1975
Approved For Reld4
j00& IIR %-V R0?65A001300170001-0
 Approved For Release 20 1//008/088 : CIIA-RRD~P~799TT000865A001300170001-0
RET
Soviet agricultural exchange groups arriving
in the US continue to include at least one respon-
sible official from the central Communist Party
apparatus. These men, who usually travel under
a light but plausible cover, usually represent the
party's Agriculture Department and sometimes are
the de facto ranking member of their delegation.
The most recent cases in point--delegations that
came to study cattle feeding practices and agri-
cultural supply systems--arrived here during June.
Vasiliy tlartynovsky, a sector head in the Agri-
culture Department, accompanied the agricultural
supply entourage, which included a deputy minister
of agriculture and the first deputy chairman of
Soyuzselkhoztekhnika, the Soviet agricultural sup-
ply organization. One member of the cattle feeding
group was last noted as first secretary of a dis-
trict party committee in Krasnodar Kray.
At least two other high-level exchange dele-
gations arrived during June: Deputy Minister of the
Petroleum Industry Dzandar Takoyev led a team of oil
specialists and administrators that met with offi-
cials of several US companies and attended a meeting
of the US-USSR Oil Working Group. Deputy Premier
and Gosstroy Chairman Ignatiy Novikov accompanied a
housing exchange delegation to this country and met
briefly with President Ford.
in commercial activity during the month, Soviet
visas, applied for and authorized, fell from around
100 in May to about 80. Over half of that number
were in connection with contracts for American auto-
motive equipment and technology or for talks with
the Occidental Petroleum Corporation concerning an
International Trade Center in Moscow, which the US
company is helping to build. Other June highlights
included:
--A representative of the All-Union Aluminum
and Magnesium Institute, who was scheduled to
July 8, 1975
Approved For Rele` `-Q'bOgB 'A- -8fM65A001300170001-0
Soviet Visitor Highlights During June
 Approved For Releafjf0%1Tfti1A M 0A865A001300170001-0
visit the American Magnesium Company. The
institute is providing American Magnesium
with start-up services for an electrolytic
magnesium production process, which is re-
putedly more efficient than the company's
old process.
--Valentin Polyakov, a prominent surgeon and
bone tissue specialist, who visited the Satra
Corporation and attended a Medeksport exhibi-
tion in Atlantic City. Medeksport exports
and imports medical equipment. (UNCLASSIFIED)
July 8, 1975
Approved For Relea5 AW89 ~ fib-R MIT
 25X1D Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
Next 5 Page(s) In Document Exempt
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
 Top Secr Aff oved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0
Top Secret
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01300170001-0