CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A025100080001-4
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 16
• Document Creation Date: December 15, 2016
• Document Release Date: March 12, 2004
• Sequence Number: 1
• Publication Date: August 24, 1973
• Content Type: REPORT

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Top Secret
Central Intelligence Bulletin
25(1
State Department review completed
Top Secret
d. 14
C
24 August 1973
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24 August 1-9T3--
Central Intelligence Bulletin
CONTENTS
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WESTERN EUROPE - US: EC diplomats prepare for visit
of President Nixon. (Page 3)
WEST GERMANY - FRANCE: Strains result from French
Minister's criticism of Bonn's policies. (Page 5)
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CHILE: Prats' resignation further muddles already
confusing situation. (Page 7)
SWEDEN: No clear sign of voter preference at mid-
point in campaign. (Page 8)
LIBYA-EGYPT UNION: Controversy down to the wire.
(Page 9)
FOR THE RECORD: (Page 13)
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WESTERN EUROPE - US: Diplomatic activity within
the EC on preparations for a fall visit by President
Nixon is continuing during the August vacation lull,
but concern persists that US "pressure" for early
agreement on a declaration of Atlantic principles
may in fact work against a satisfactory European
response,
While discussion proceeds in NATO on a possible
draft declaration that would focus on defense and
security matters, the EC Nine foreign ministers are
preparing for a meeting on 10-11 September to dis-
cuss topics the community might take up with the
President.
Italy and most of France's other partners want
the September session to go beyond a mere list of
topics to define "European" positions. Some of the
Nine believe, however, that the US desire for early
results from the US-European dialogue will reinforce
French arguments that the community needs more time
to work out a common position and only bilateral US
talks with individual EC states are possible at this
stage. A senior Luxembourg official, for example,
has told the US Embassy that. the President's trip
should "launch rather than conclude the Year of
Europe" and that greater US flexibility on the timing
of a declaration could enable the EC to get the French
to be more forthcoming on both the form of the Pres-
ident's visit and the content of an eventual declara-
tion.
Working-group preparations will shortly begin
for the meeting on 10-11 September. The Germans
want the Europeans to be ready to consult with the
US following the September session.
24 Aug 73 Central Intelligence Bulletin
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West German impatience with both its European
partners and the US is evident in an interview with
Finance Minister Schmidt published this week.
Schmidt criticized the inability of the EC states
thus far to come up with a common answer to the US
initiative and indirectly indicted France. He also
criticized the US, however, noting that the absence
of adequate consultation on the US-Soviet agreement
to prevent nuclear war did not inspire mutual con-
fidence within the alliance and that the US distinc-
tion between world-wide responsibilities for America
and regional ones for Europe was not very appropriate.
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WEST GERMANY - FRANCE: The controversy aroused
by French Agriculture Minister Chirac's recent crit-
icism of Bonn's policies has not only strained rela-
tions between Paris and Bonn, but is having reper-
cussions on the West German political scene.
Opposition party leaders have echoed Chirac's
charge that West Germany is "turning away from
Europe" and warned that West Germany is drifting
toward neutralism. Spokesmen for the opposition,
particularly Christian Democratic parliamentary
.leader Karl Carstens, have also questioned whether
the Brandt government, in its preoccupation with
Ostpolitik, is paying adequate attention to Western
Europe.
The government's initial public reaction to
both Chirac and its domestic critics was restrained.
Brandt and other government officials privately ex-
pressed displeasure and anger, however, and German
officials are now publicly and sharply rebutting
Chirac's charges. The US Embassy in Bonn reports
that Brandt made a heated defense of his European
policies during a meeting with Carstens on 21 August.
He also instructed the Foreign Office to make known
his displeasure to the French, and demarches have
been made in both Bonn and Paris. A meeting between
the French ambassador to Bonn and a senior Foreign
Office official reportedly resulted in sharp ex-
changes and was described as quite unpleasant.
West German officials now are publicly question-
ing Chirac's sincerity and are generally distrustful
of French policies. The West German view of l'affaire
Chirac was best expressed by Foreign Office State
Secretary Apel who said that if there is a problem
about European integration, "it is a French problem."
Apel also stated that the other EC countries were
prepared to compromise "whereas France frequently
held back and made it difficult, for itself and also
for us."
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CHILE: The resignation last night of General
Carlos Prats as both Minister of Defense and army
commander in chief has further muddled an already
confusing situation.
Prats has been under increasing pressure from
his army colleagues to step down. The last straw
appears to have been the army wives' march to his
home on Tuesday and the revelation that President
Allende was compiling a list of "rebel" military
officers to be cashiered next month. Prats was
succeeded as commander in chief by General Agusto
Pinochet. All of the other members of the cabinet--
including the military officers--have submitted
their resignations, but, thus far, these have not
been accepted by Allende. A cabinet change may
occur within the next few days, however.
I despite press specula-
tion that a strike set ement is imminent, the
president of the truckers' confederation says that
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the strike will continue at least until 28 August.
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SWEDEN: The election campaign has reached its
mid-poi nt and there are still no signs of a clear
shift in voter opinion toward either the ruling
Social Democrats or the three non-socialist opposi-
tion parties.
The Social Democrats, aware of the waning appeal
of foreign policy issues at a time when the voters
are concerned about economic problems, are stressing
domestic achievements and promising new measures to
improve the lot of the wage-earner. Last week, Prime
Minister Palme came out in favor of increasing old-
age pensions and reducing the tax burden on workers
by shifting the responsibility of retirement contri-
butions to the employers. Palme probably expects
the proposal to neutralize the issue of high taxes,
one of the most potent weapons in the opposition's
arsenal.
Some Social Democrats are skeptical, fearing
that the plan may backfire and aggravate the unem-
ployment issue which, according to polls, is the
principal concern of most voters. They theorize
that the prospect of higher labor costs will dis-
courage employers from hiring additional. workers.
Government leaders probably hope that the recent
increase in subsidized relief work and seasonal ad-
justments will improve the unemployment picture
before the elections on 16 September.
Despite the failure of the opposition parties
to do little more than criticize the government--
especially on the issue of high taxes--their cam-
paign is attracting some attention. According to
the US Embassy in Stockholm, the non-socialist par-
ties continue to draw large and enthusiastic crowds
at their rallies. Nevertheless, unity among the
Liberals, Centrists, and Conservatives continues to
be handicapped by lack of agreement on a broad plat-
form that would attract the support of voters in
all three parties.
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Libyan-Egyptian Union: Controversy down to the Wire
With the deadline for union little over a week
away, Egypt and Libya have yet to agree on a formula
for their merger. Controversy continues over the
structure of union, its implementation, and its lead-
ership, and there is a less pressing, but far more
serious disagreement over the fundamental policies
of the unified state. Presidents Qadhafi and, to a
lesser extent,'Sadat have attached considerable per-
sonal prestige to this much heralded step toward
Arab unity, and the chances are still reasonably good
that they will reach pro forma agreement in time for
a formal proclamation on 1 September. The agreement
will nonetheless probably embody little more than
the trappings of unity and the first few interim steps
toward substantive integration. Whatever the two
leaders set in motion next month,. the fundamental
differences between them will sharpen as each tries
to control the other, generating much friction.
Paradoxically, President Qadhafi has been the
most formidable obstacle to his own unity scheme.
His refusal thus far to approve anything less than
a "complete and immediate" union has virtually can-
celed out over 13 months of planning. In public, he
has protested that Sadat must assume leadership of
the union, but in the actual negotiations he has
been unwilling to accept any less political clout or
military authority than his Egyptian partner. His
fervent espousal of his own brand of Islamic radical-
ism, particularly his cultural revolution, has deep-
ened misgivings about the merger at home and in
Egypt. Finally, his brinksmanship--most notably the
"march on Cairo" and his brief but dramatic retire-
ment--has convinced the wary Egyptian leadership
that it cannot enter a full partnership with Libyan
extremism. Despite this Egyptian firmness, Qadhafi
continues to bargain for concessions from Cairo and
apparently means to do so.right down to the 1 Septem-
ber deadline--and afterwards if necessary. He has
delayed the final working session with President
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Sadat in a deliberate last-minute war of nerves, but
the Egyptians reportedly are still steadfast in their
decision not to cave in to Qadhafi's demands.
The Egyptians originally entered the union proj-
ect unenthusiastically. Sadat saw certain benefits
to be gained if the merger could be accomplished on
Egyptian terms. But in view of Cairo's ill-fated
unity schemes in the past, it has been particularly
circumspect in its approach to the merger with Libya.
The union's principal attraction for Egypt lies
in the access it would provide to Libya's oil wealth
and the opportunity to farm out surplus Egyptian
workers in the backward but lucrative Libyan economy.
Egypt receives an annual subsidy of $59 million from
Libya, and has in the past received large ad hoc cash
payments. More recently, however, Qadhafi has only
been willing, to make military purchases on Egypt's
behalf. The Egyptians probably hoped to dominate
any union that would give Cairo more direct and more
dependable access to Libyan money.
The chief problems from Cairo's standpoint lie
in the role Qadhafi himself would assume in the united
state and the part his policies would play in any
unity scheme. Sadat wants the Libyan leader in a
position of responsibility, primarily because he
feels he can better control Qadhafi in office rather
than out. He also believes that Qadhafi's presence
in the government would be a palliative to those
elements in Egypt, however small in number, who ad-
mire the dynamic Libyan and favor union because he
is its chief advocate.
Sadat is wary, however, of allowing Qadhafi a
role from which he could control any facet of Egyp-
tian policy. Sadat balks at appointing Qadhafi armed
forces commander in chief, a position he might try to
use to translate his extreme views on Israel into
action. On the domestic front, Sadat is determined
to deny Qadhafi leverage to introduce his cultural
revolution in Egypt. The Egyptian leaders are dis-
dainful of the cultural revolution, chiefly because
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they regard it as the embodiment of the political
immaturity that they believe they overcame 20 years
ago; their disdain is tinged with apprehension, how-
ever, at the disruption such a revolution could cause
in Egypt.
A number of scenarios for union have emerged
from sessions of the specialized unity subcommittees
and from the subsequent meetings--increasingly fre-
quent in the past few months--of the higher-level
unity commissions that are directly answerable to
the two presidents. Virtually all have involved a
plebiscite to be held on 1 September and the initial
integration of a few ministries, to be followed at
some later, usually unspecified period by fuller
union. All have been modeled on the Egyptian con-
cept of a gradual integration that would preserve
substantial autonomy for both regions.
The Egyptian plan most recently reported to be
under discussion may become the basis for any com-
promise settlement between the two sides. The pro-
posal calls for one capital, one cabinet, one mili-
tary establishment, and one political party. Presi-
dent Sadat would be nominated for the presidency
with Qadhafi as the vice-presidential candidate. A
referendum would be held in both countries to approve
the proposal, after which a unified cabinet would be
formed. Only the foreign ministries, defense estab-
lishments, and perhaps the interior ministries would
be integrated--at least initially.
The Egyptians apparently are willing to dress up
this scenario with a proclamation that it represents
"complete" merger, but Qadhafi is dissatisfied with
what he considers to be mere cosmetics and has con-
tinued to withhold his approval.
The deadlock can be broken in the week remaining
before 1 September, but Sadat has set out his minimum
position and the burden now rests with Qadhafi.
Sadat has committed enough of his reputation to the
merger that an announcement on 1 September of some
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steps to keep it alive is important to him. The
union is not important enough, however, to induce
him to bow to Qadhafi's demands and, if the Libyan
leader will not compromise in the week ahead, Sadat
would be prepared to reject unity entirely. Sadat
has, or believes he has, less troublesome commitments
from other Arab states, notably Saudi Arabia, of
political and financial support that could compensate
for the loss of a partnership with Libya, and he may
feel that the failure of merger would not in any
event necessitate a complete severance of relations
with the Libyans.
In the face of the Egyptian refusal to accept
the Libyan blueprint, Qadhafi may compromise, accept-
ing a tactical delay in the pursuit of his goals.
Qadhafi could try yet another dramatic ploy to get
his own way, but at this juncture this seems improb-
able. Even when he seems most impetuous, the Libyan
leader calculates his potential gains and losses,
and this time he stands to jeopardize his drive to-
ward Arab unity, a cause he most fervently believes
in. For him, merger with Egypt is the first critical
step in the "battle" to restore Palestine and in the
campaign to rejuvenate Arab dignity. Sadat no doubt
strikes Qadhafi as an unsuitable leader of this cam-
paign; nevertheless Egypt--for Qadhafi--is the essen-
tial vanguard of the Arab people. Qadhafi may also
believe that he--or the force of his principles--will
eventually dominate and strengthen the union, no mat-
ter how feeble it is initially. With this belief in
the forefront of his mind, Qadhafi could justify a
temporary compromise without abandoning his vision of
a united and powerful Islamic Arab nation.
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FOR THE RECORD*
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China-US: The first of ten Boeing 707 jet air-
craft purchased by Peking arrived in Shanghai on 23
August. The delivery of the jetliner followed a
two-week delay because of minor mechanical problems.
The long-range aircraft probably will be used
China's expanding international air system.
Mexico-US: US and Mexican negotiators have
reached a final agreement on the Colorado River
salinity problem, resolving one of the major irri-
tants in relations between the two countries over
the last decade. The agreement states that by July
1974 the US will take measures to control the sa-
linity of water that flows into the Mexicali Valley.
Joint presidential approval of the a reement is ex-
pected before the end of the month.
*These items were prepared by CIA without consulta-
tion with the Departments of State and Defense.
2,4 Aug 73
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