CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A026300240001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 15, 2016
• Document Release Date: March 30, 2004
• Sequence Number: 1
• Publication Date: April 17, 1974
• Content Type: REPORT

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Top Secret
Central Intelligence Bulletin
Top Secret
C
April 17, 1974
RETURN TO ARCHWES Ea RECORDS CENTER
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April 17, 1974
Central Intelligence Bulletin
CONTENTS
USSR-SYRIA: Moscow pledges assistance. (Page 2)
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EGYPT-ISRAEL: Sadat reminds Israel that Egypt is
ready to counter any attack. (Page 5)
NATIONALIST CHINA - JAPAN: Taipei against impending 25X1
civil air agreement between Tokyo and Peking. (Page 6)
FRANCE: About 40 candidates nominally entered in pres-
iden--t al election. (Page 12)
KUWAIT-FRANCE: Kuwait buys Mirage F-1 interceptors.
JAPAN: Balance-of-payments deficit hits $1 billion
in March. (Page 18)
FOR THE RECORD: (Page 26)
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*USSR-SYRIA: The communique issued on April 16
following President Asad's visit to the USSR contains
no major surprises; it indicates that Moscow will
provide Damascus with additional military and eco-
nomic assistance in order to strengthen its ties to
Syria. Asad signed new agreements on economic, sci-
entific, and cultural affairs during his stay in
Moscow, but the communique made no mention of a treaty
of friendship and cooperation.
There was no reference to an agreement on mili-
tary aid, but the two sides "outlined steps" for the
further strengthening of the Syrian armed forces and
stressed the importance of increasing Syria's "de-
fense potential" in the face of "continued Israeli
aggression." The communique repeated the language
used in the communique following Gromyko's trip to
Damascus last month, which stated that Syria has the
right to use all "effective means" for the liberation
of its occupied lands.
There is no indication whether Moscow was suc-
cessful in persuading Asad to bypass the Washington
disengagement talks in favor of the Geneva forum.
References in the communique to middle East peace
efforts were almost verbatim repetitions of those
in the Gromyko communique. Disengagement was char-
acterized as only a partial step toward peace that
must be tied to an overall settlement. The impor-
tance of the Soviet Union's participation in all
the stages and spheres of a settlement was again
stressed.
The communique ended by stating the resolve of
both sides to give a "firm rebuff" to any attempts
to damage Soviet-Syrian friendship. In part this is
meant as a muted warning to the US, but it also
carries the implication that Syria will not follow
Egypt's example in improving relations with the US
at the USSR's expense.
`Because of the shortage of time for preparation of this item, the analytic
interpretation presented here has been produced by the Central Intelligence
Agency without the participation of the Bureau of Intelligence and Re-
search, Department of State.
Apr 17 , 1974 Central Intelligence Bulletin
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*EGYPT-ISRAEL: President Sadat again reminded
Israel yesterday that Egypt has tanks and surface--
to-surface missiles ready to counter and retaliate
against any Israeli attack on Egypt, but his remarks
seemed designed as much for Arab consumption as for
the Israelis.
Speaking to a group of Egyptian students, Sadat
said that he has a "fantastic" number of tanks ready
on the Suez Canal's west bank should they be needed
to parry an Israeli attack. He also repeated a threat
he made during the October war to retaliate with
Egyptian "rockets" that are targeted against Israeli
cities if Tel Aviv initiates an attack on Egyptian
cities.
Sadat apparently made no reference to a possible
Egyptian response to the fighting on the Syrian front.
By confining his remarks to the Suez front and couch-
ing them in terms of a reaction to any Israeli aggres-
sion against Egypt, Sadat avoided directly threaten-
ing Tel Aviv, while reminding both the Israelis and
his Arab critics that Egypt has not let down its
military guard.
Radical Arabs have charged Sadat with abandon-
ing the Arab cause after achieving the disengagement
agreement with Israel.
*Because of the shortage of time for preparation of this item, the analytic
interpretation presented here has been produced by the Central Intelligence
Agency without the participation of the Bureau of Intelligence and Re-
search, Department of State.
Apr 17 , 1974 Central Intelligence Bulletin
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NATIONALIST CHINA - JAPAN: Taipei's hard line
on the impending civil Fagreement between Tokyo
and Peking is working against any face-saving compro-
mise on continuing Nationalist air links with Japan.
Encouraged by anti-Tanaka forces within Japan's
Liberal Democratic Party, Taipei has reiterated threats
to close its air space (specifically its Flight Informa-
tion Region and Air Defense Identification Zone) to
Japanese planes if Tokyo unilaterally alters its ex-
isting air agreement with the Republic of China. To
give the threat muscle, the Nationalist Air Force has
been placed on alert and given contingency instruc-
tions for intercepting intruding Japanese aircraft,
thus increasing the potential danger of an air inci-
dent.
Premier Chiang Ching--kuo long ago wrote off Jap-
anese Premier Tanaka and Foreign Minister Ohira as
too pro-Peking. He now appears to believe that the
Tanaka government will be forced by right-wing pressure
to suspend the negotiations, or, in pushing the agree-
ment through, will be badly damaged politically.
Such an estimate clearly overstates Chiang's in-
fluence and the right-wing strength within the ruling
LDP. Chiang's course of action, moreover, appears to
be increasing anti-Japanese feeling in Taiwan and
feeding the Nationalists' sense of grievance, making
compromise more difficult..
Despite his adamant public stand, which has aroused
misgivings among his advisers, Chiang has not completely
closed the door to future negotiation, nor has he
specified the exact conditions which would trigger a
rupture in air service. Air links to Japan are still
economically and symbolically important to Taipei, and
Japan is a major economic partner. The points at issue
between the Nationalists and Tokyo have been reduced
to two: the most important being the presence of Na-
tionalist airline personnel in Japan; the less signif-
icant is a change in the name of Taipei's airline.
(continued)
Apr 17 , 1974 Central Intelligence Bulletin
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Both points probably are open to discussion. In the
present overheated atmosphere, however, Taipei may
overplay its hand and precipitate a rupture which will
embitter future Nationalist-Japanese relations in gen-
eral and make future working arrangements more diffi-
cult.
Prime Minister Tanaka, for his part, is deeply
committed to an air agreement with Peking and is un-
likely to change course as a result of Taipei's tough
stand. He plans to have the agreement signed, prob-
ably within a week, and to submit it to the Diet for
early ratification, which seems assured. While Taipei's
new tactics have made it harder for Tanaka to secure
rapid approval of an agreement in the councils of his
own party and in the cabinet, there is good evidence
that key factional leaders, notably Finance Minister
Fukuda, have decided against using the issue in any
overt challenge to Tanaka's leadership.
The hard-line Nationalist attitude will nonethe-
less encourage the ruling party's more extreme right-
wing and pro-Taiwan elements to make sharp public at-
tacks on Tanaka as well as on Foreign Minister Ohira,
who has staked his personal prestige on achieving the
agreement with Peking. If the right wing makes a
case that Ohira has failed diplomatically by his ina-
bility to preserve air links with Taiwan, he may be
compelled to assume the blame and resign.
Apr 17 , 1974 Central Intelligence Bulletin 7
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FRANCE: The deadline for filing in the French
presidential election passed yesterday with about
40 candidates nominally in the running. The plethora
of hopefuls--plus the revolving-door candidacies of
several others, including the Prime Minister--has
made the race something of a joke to the average
voter. The Constitutional Council will pare down
the list to no more than a dozen candidates by the
end of the week, and the campaign will start offi-
cially this weekend.
Three members of the governing coalition parties
are in the running: former prime minister Jacques
Chaban-Delmas, Independent Republican Party leader
Valery Giscard d'Estaing, and former commerce min-
ister Jean Royer. Despite the disarray within the
Gaullist-led coalition, Francois Mitterrand, the
sole candidate of the left, is not now expected to
win an absolute majority of votes in the first round
on May 5. In effect, the first round will be a pri-
mary to determine which candidate on the right will
face Mitterrand in the runoff on May 19.
Mitterrand will gain some votes because of the
absence of a serious center-party candidate. Jean
Lecanuet is backing Giscard d'Estaing, and Jean-
Jacques Servan-Schreiber yesterday said that he will
support Giscard or Mitterrand in the second round.
His statement was clearly directed against Chaban.
Chaban's prospects also were dimmed early this
week by another attempt by prominent Gaullists loyal
to Pompidou to force Chaban to step aside in favor
of a unity candidate. Nevertheless, polls indicate
Chaban is still running ahead of Giscard. Royer is
extremely popular with small businessmen, and his
candidacy is expected to take votes away from Chaban,
Giscard, and Mitterrand.
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KUWAIT-FRANCE: After nearly eight months of ne-
gotiations, Kuwait has purchased Mirage F-1 jet inter-
ceptors from France, according to the Kuwaiti defense
minister. No details of the accord are available;
previous reporting indicates that. Kuwait was inter-
ested in obtaining at least 16 F-1s.
The F-1 is a supersonic fighter and attack air-
craft capable of reaching speeds of Mach 2 at high
altitudes. It is generally armed with air-to-air
missiles. The French aircraft may have been selected
over competing US F-5 and A-7 planes because Paris
attached no restrictions on its use. The Mirages
probably will not be delivered for at least a year
because of the need to train Kuwaiti pilots. Kuwait
is still interested in procuring Franco-British Jaguar
aircraft because of their ground-support capability.
Kuwait is the first Persian Gulf country to buy
the F-1, although Paris has sold other Mirage aircraft
to Saudi Arabia--probably for Egyptian use--and to
Abu Dhabi. Kuwait also acquired French helicopters
in February and ground forces equipment in 1969.
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JAPAN: Tokyo registered a $1-billion balance.-of-
payments deficit in March as the oil bill for the
month reached $1.6 billion. The per-barrel cost of
oil to Japan has continued to rise this month.
Adding to the payments difficulties was the con-
tinued rapid growth in the value of non-oil imports,
which were 56 percent higher than in March 1973. Two
thirds of this rise was the result of price increases.
The rate of increase, however, was lower than in pre-
ceding months, and this trend is likely to continue
as domestic demand weakens,.
Japan's exports were up 43 percent over last
March, but most of the increase resulted from higher
prices. Steel and automobiles were the big gainers.
Advance indicators point to similar increases in the
next few months, and the quick settlement of the sea-
mens' strike has eliminated a potential depressant on
exports. Wage increases on the order of 30 percent
are being granted in various industries, however, and
these could lead to some loss in Japan's competitive-
ness later in the year.
The government has had some success in holding
down long-term capital outflows. The $300-million net
outflow in March was the smallest in nearly two years.
Restrictions on overseas real estate purchases, tight
credit conditions, and the borrowing abroad by Japanese
firms of $180 million have been largely responsible
for the drop in outflows.
The first-quarter payments deficit of $4.1 billion
may not be repeated, but improvement is not likely
until non-oil imports slow markedly. Rapid export
growth, the principal alternative solution, is diffi-
cult to achieve and would spark undesirable reactions
from Japan's trading partners.
Apr 17, 1974
Central Intelligence Bulletin
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France: The balance of trade in the first quar-
ter of 1974 was in deficit by $681 million, compared
with a surplus of $373 million for the same period a
year ago. The turnaround was caused mainly by a near
tripling of oil prices; a gradual deterioration of the
non-oil trade balance over the past six months aggra-
vated the problem.
Apr 17, 1974
Central Intelligence Bulletin 26
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