CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A022900080001-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 18
• Document Creation Date: December 15, 2016
• Document Release Date: October 3, 2003
• Sequence Number: 1
• Publication Date: October 6, 1972
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
State Department review completed
Secret
N2 41
6 October 1972
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No. 0240/72
6 October 1972
Central Intelligence Bulletin
VIETNAM: Military developments. (Page 1)
NATO-MBFR: Differences on participation issue con-
tinue to block preparations for MBFR. (Page 3)
EGYPT: Sadat's proposal for Palestinian government
fails to generate significant Arab interest. (Page 4)
CHILE: Allende gets political boost from Kennecott
action. (Page 6)
EUROPEAN COMMUNITIES: New proposal reflects EC
interest in Mediterranean region. (Page 7)
LIBYA-ITALY: National oil companies agree to joint
venture. (Page 8)
PORTUGAL: Police strengthened to counter terrorists.
(Page 9)
PAKISTAN - NORTH KOREA: Diplomatic relations consid-
ered. (Page 10)
SUDAN: Cabinet resigns (Page 11)
SWITZERLAND-EC: Free trade pact (Page 11)
WEST GERMANY: Quotas on East European imports re-
moved (Page 12)
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Petroleum Pipeline in North Vietnam
K'un-ming
Fang-cheng
New pipeline Chan-chiang
s construction
Hon Gai
Petroleum pipeline
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VIETNAM:
otography I Ireveals
preparation of right-or-way tor a new pipeline along
the northeast coast of North Vietnam. Two miles of
trenching and ten miles of intermittent trace were
observed, starting at a point five miles northwes
of Hon Gai near, but not joining, the system that
Central Intelligence Bulletin
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-ry~ns from Hon Gai to Hai Duong. If the construction
pattern follows that of the previous pipelines built
by North Vietnam to China, this new line mi h al-
ready be completed-to the Chinese borde 25X1
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'NATO-MBFR: Differences on the participation
issI ontinue to prevent allied agreement on pro-
ceeding with preparations for Mutual and Balanced
Force Reduction (MBFR) talks.
At a North Atlantic Council meeting on 4 Octo-
bet, the allies continued to seek a compromise posi-
tion. The US wants to include only those states
that would be directly involved in the proposed
force reduction area--a formula which among others.
excludes Greece, Turkey, and Italy. These three,
however, restated their insistence that they be
represented in the proposed talks, which they feel
directly concern their own defense. They contend
that their exclusion would in fact threaten NATO
unity. The Dutch are supporting a compromise posi-
tion that would allow the flank states to have a
single, rotating, non-participating observer at the
MBFR talks. The Germans are also supporting a com-
promise and are attempting to reduce the flank
states' opposition in bilateral contacts with the
three southern states. Bonn would also acquiesce in
putting off the participation issue, thus allowing
the US to respond to a recent Soviet note proposing
the start of MBFR preparatory talks next January.
The allies are still worried that the sequence
of events proposed by the Soviets does not afford
sufficient overlap for the MBFR talks and the Con-
ference on Security and Cooperation in Europe to
satisfy NATO's insistence on parallelism. Their
concern probably was increased by the report of the
Netherlands representative that Soviet Foreign Min-
ister Gromyko, in a conversation with Dutch Foreign
Minister Schmeltzer, pressed for as little parallel-
ism as possible. Gromyko insisted that actual MBFR
negotiations could only begin after a CSCE had been
concluded and that preparatory talks lea in to
both shpuld be non-substantive.
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SECRET
EGYPT: President Sadat's recent suggestion
that a provisional Palestinian government be es-
tablished has failed to generate any significant
Arab interest.
Although the Arabs continue to discuss the
creation of a Palestinian entity, there are serious
differences among them about its structure. After
two days of deliberations in Beirut, the Executive
Committee of the Palestinian Liberation Organiza-
tion (PLO) announced on 2 October that it would
support a "Palestinian entity as embodied by the
PLO and its institutions"--an indirect rejection
of Sadat's proposal. The formation of a govern-
ment-in-exile has been a contentious issue among
fedayeen leaders for some time. Sadat's unexpected
proposal on 28 September probably caught the PLO
leadership off guard, precluding serious discus-
sions at this time.
PLO chairman Yasir Arafat and the other mem-
bers of the Executive Committee are probably appre-
hensive about retaining what authority they now
have over the fedayeen in any new Palestinian or-
ganization. In addition to its form being a point
of contention, bitter infighting would almost cer-
tainly develop over key positions within the new
structure. The fedayeen also would face the
broader problem of gaining general Palestinian
support for a PLO-sponsored provisional government.
Some Palestinians'in the Israeli-occupied West Bank
of Jordan are antipathetic toward the fedayeen in
general; their counterparts on the East Bank, fear-
ing repression from Amman, are reluctant to voice
approval of a Palestinian government-in-exile.
President Sadat's motives in publicly broach-
ing this idea appear to be primarily rhetorical and
tactical. The Munich incident and its aftermath
generated an emotional polarization of the Arabs
around the Palestinians, and Sadat apparently deemed
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it necessary to strengthen his claim to Arab lead-
ership by raising this idea. In the event that a
provisional government is formed, Sadat may hope it
would be more moderate and more responsive to Cairo's
control. Sadat's proposal may also have been aimed
at undercutting King Husayn's plan for a United Arab
Kingdom.
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CHILE: The Allende government is getting a
political boost from the Kennecott Corporation's
interference with a copper shipment to France,
despite its serious economic implications.
Chilean officials were quick to publicize the
recent decision of a Paris court to accede to the
Kennecott Corporation's demand that a copper cargo
worth $1.3 million from the former Kennecott mine
in Chile be attached when it reaches a French port
this week. Opposition spokesmen rallied to Allende's
support as they have consistently done on the highly
nationalistic issue of the role of foreign investors
in Chile's major resource. A Christian Democratic
deputy called the move an open attack on Chile that
demands retaliation.
The Chilean ambassador in Paris, Nobel poet
Pablo Neruda, garnered support for his expressions
of outrage from the multiparty Chilean delegation
on its way home from the recent interparliamentary
congress in Rome. Neruda carefully pointed out that
the French Government was not responsible for the
court's decision, indicating the Allende admini-
stration's desire for good relations with Paris.
The attachment could cause severe copper mar-
keting problems for Chile in addition to the poten-
tial loss of foreign exchange involved in the cur-
rent shipment. The government will shortly enter
into negotiations for 1973 sales contracts with ma-
jor European buyers, who will be leery of contract-
ing for copper shipments subject to being blocked
by subsequent court actions.
6 Oct 72 Central Intelligence Bulletin
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EUROPEAN COMMUNITIES: An EC Commission proposal
for a unified Mediterranean policy further demon-
strates the EC's belief that it has "special" respon-
sibilities and interests in the area.
The Commission approach is designed to increase
the effectiveness of Community action, permit the EC
to offer similar agreements to both Israel and the
Arab states, and allow for an industrial free trade
agreement with Spain. The Commission is also con-
cerned about Community dependence on the Mediterra-
nean area's oil, and plans a separate document on
petroleum in the next week or so.
The proposal would broaden and unify the Commu-
nity's economic ties with the Mediterranean countries.
Building upon the present preferential trade agree-
ments, the EC and these countries would gradually
establish free trade areas in industrial and, to'the
extent possible, agricultural products. Difficulties
could arise over the EC's desire to maintain protec-
tion for certain products, such as textiles, wine,
and citrus fruit, in which the Mediterranean coun-
tries are most competitive. Moreover, the Mediter-
ranean countries may wish to protect certain "infant"
industries indefinitely. Beyond these trade provi-
sions, the Commission envisages extensive EC finan-
cial, technical, and employment assistance for the
Mediterranean and also recommends economic coopera-
tion in such areas as pollution control and invest-
ment regulation.
The proposal will be the subject of debate in
the EC Council. When preliminary discussion begins
on Monday, Italy and France are likely to voice
reservations about agricultural provisions, even
though Paris earlier supported the concept of a
unified approach. The proposed agreement will also
raise difficulties Tor the US because of possible
damage to American trading interests both in the
Mediterr can area and i_ the EC countries.
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LIBYA-ITALY: The national oil companies of
both countries have signed a 50-50 participation
agreement that probably will set a precedent for
Libya's future negotiations with other Western oil
companies.
The Libyan National Oil Company now has joint
ownership in three ENI concessions. Two of these
have proved unproductive thus far, but production
from the third, held up since spring when negotia-
tions began, will start immediately. ENI represent-
atives consider the terms of the agreement favorable
because Libya will base its compensation to Rome
for past investments on the original rather than on
depreciated values. In addition, Tripoli will share
equally in the considerable investment and develop-
ment costs and ENI will handle the marketing of the
oil. Libya's difficulties in marketing nationalized
British Petroleum crude this year probably prompted
this arrangement.
The joint venture represents ENI's largest for-
eign oil producing success in some 15 years of world-
wide search. The projected annual production of
ten to 15 million tons from the venture will more
than equal ENI's total oil production last year.
Most of the oil probably will be utilized in ENI's
own refineries which supply about one quarter of the
Italian market.
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PORTUGAL: The new decree law strengthening the
Portuguese political police (DGS) reflects the gov-
ernment's increased concern about terrorist groups.
The new law raises the authorized strength of
the DGS by 13 percent. It also exempts the DGS from
the most important of the penal. code reforms that
took effect on 1 October, the same day the DGS law
was issued. The DGS receives a blanket exemption
in overseas territories where "grave subversive acts"
are occurring. In the metropole, it is released
from reform provisions such as the mandatory pres-
ence of a lawyer during interrogation of suspects
and the preparation of pre-trial dossiers by a judge
rather than the police.
The law also sanctions the current DGS practice
of issuing arrest warrants. It raises the pay of
DGS personnel and authorizes its active and retired
"higher functionaries" to carry arms without a li-
cense.
The government has been embarrassed by sporadic
terrorist acts over the past two years. Last month,
a communications station near Lisbon was bombed. A
bombing in July heavily damaged 13 new troop trans-
port vehicles in Lisbon. The "revolutionary bri-
gades," reportedly associated with a dissident Com-
munist exile group in Algiers, claimed responsibil-
ity for these acts and for sabotage last year. The
"brigades" and Armed Revolutionary Action, the lat-
ter reportedly linked to the orthodox Portuguese
Communist Party, have been setting off explosives
since 1970. Their aim is to demonstrate opposition
to the Caetano government, the war in the African
provinces, and Portugal's link to NATO.
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PAKISTAN - NORTH KOREA: Islamabad is consider-
ing establishing full diplomatic relations with
Pyongyang, according to the Pakistani foreign secre-
tary, but will not take any action until the end of
the year.
Pakistan now has relations at the consulate
general level with both North and South Korea, but
does not recognize either country. There is no in-
dication that Pakistan will recognize Seoul at the
same time.
China has been urging Pakistan to accord recog-
nition for some time. The North Koreans have sup-
plied some military equipment to Pakistan and have
recently been making a major propaganda effort to
sell themselves in Pakistan. President Bhutto,
moreover, may believe that recognition will lessen
the restiveness among his left-wing followers over
other foreign policy moves, such as Pakistan's re-
newed participation in the Central TreatLv Organiza
tion (CENTO).
6 Oct 72 Central Intelligence Bulletin
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NOTES
SUDAN: The resignation of the cabinet yester-
day will set the stage for the convening of the first
constituent assembly since President Numayri came to
power in May 1969. A new cabinet--which probably
will include most of the former ministers--may be
appointed sometime before the assembly's first ses-
sion on 13 October. Numayri, however, may drop those
officials identified as pro-Egyptian, as relations
between Cairo and Khartoum continue to deteriorate.
Sudan's relations with Egypt hit a new low when
Numayri intercepted Libyan troop transports en route
to Uganda to support President Amin in the dispute
with Tanzania.
SWITZERLAND: The Swiss-EC industrial free trade
s on le is
a
h
i
-
-- - - &
a
n u u.Ly
agreement concluded
proval but faces uncertain prospects in a forthcoming
-
l A
d
s
era
referendum. In approving the treaty the Fe
sembly, after some dissension, also endorsed the ad-
ministration's long-standing pledge to subject the
agreement to a national referendum. This vote, now
set for 3 December, may imperil the treaty despite
strong popular support for its ratification. Swiss
.federal law stipulates that any measure submitted
to referendum must carry a majority of the 22 cantons
as well as of the total popular vote. Recent sound-
ings raise the possibility that a majority of the
smaller and more insular cantons, skeptical of the
's benefits and of its impact on Swiss neutral
treat
y
ity, may vote against the agreement.
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(continued)
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SECRET
WEST GERMANY: Bonn reportedly is removing quota
restrictions on some 430 items that are imported from
Eastern Europe. The move to increase import competi-
tion comes shortly before parliamentary elections
scheduled for November, and is designed to demonstrate
the government's determination to fight inflation.
It probably also is an effort to improve economic re-
lations with the East. Chancellor Brandt's Ostpol-
itik has not yet produced the economic benefits prom-
ised by the ratification last spring of the Moscow
and Warsaw treaties. Bonn's move will have a more
immediate psychological impact than a practical ef-
fect on inflation.
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SECRET
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NATIONAL INTELLIGENCE ESTIMATE
The United States Intelligence Board on 4 Octo-
ber 1972 approved the following national intelligence
estimate:
NIE 75/76-72 "The Horn of Af "
Central Intelligence Bulletin
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Secret
Secret
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