CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A027300010004-4
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 20, 2016
• Sequence Number: 4
• Content Type: REPORT

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Top Secret
National Intelligence
Bulletin
State Dept. review
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N?_ 647
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National Intelligence Bulletin
December 19, 1974
CONTENTS
USSR: Defense budget. (Page 1)
USSR-US: Moscow condemns US efforts to link eco-
nomic relations with Soviet concessions on emigra-
tion. (Page 5)
PORTUGAL: US aid offer is well received. (Page 7)
CYPRUS: Makarios moving to consolidate support
among Greek Cypriots. (Page 8)
RHODESIA: Black nationalists divided. (Page 9)
ARGENTINA: As a result of merit promotions in the
army, fewer Peronist supporters hold key commands.
(Page 10)
CUBA-UN: Havana's relations with the Latin Ameri-
can regional group at the UN. (Page 11)
SOUTH VIETNAM: The military situation. (Page 13)
KOREA: North Korea's attempt to gain UN support
to get US troops out of the peninsula has been
blocked. (Page 14)
FOR THE RECORD: (Page 17)
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National Intelligence Bulletin December 19, 1974
Presenting the annual budget for 1975, Soviet Fi-
nance Minister Garbuzov announced that for the second
year in a row, planned defense spending will decline.
The USSR claims that defense spending for 1975 will
amount to 1704 billion rubles, a decrease of about 1
percent from the 1974 figure of 17.65 billion rubles.
After remaining virtually constant from 1970 through
1973, the announced Soviet defense spending figure has
declined the last two years,
In sharp contrast to the announced budget figure,
intelligence estimates project Soviet defense spending
in 1975, including amounts for military research and
development and for space, will be about 29 billion
rubles--in 1970 prices--some 4 to 5 percent higher than
1974. Over the past two years, when announced spending
has declined by 3 percent, these estimates show spending
rising faster than at any time in the past.
The main impetus to this surge comes from the
Soviets' efforts to modernize their strategic missile
force, continue deployment of new sea-based ballistic
missile systems, and sharply increase expenditures for
new tactical aircraft. These estimates are based on
calculations of the cost of observed changes in military
and space programs and forces, They are independent of
the announced Soviet defense figure.
That public figure serves primarily as a political
and propaganda device, both internationally and domesti-
cally. Claims of declining defense spending for the past
two years, although contradicting trends in observed
programs, are in keeping with the image the Soviets
are attempting to project with their policy of detente.
Brezhnev.reportedly has expressed concern lest the
Soviet people learn the true magnitude of the USSR's
military expenditures at a time of domestic pressure
for more consumer goods and services,
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National Intelligence Bulletin
December 19, 1974
The announced figure--the only public defense sta-
tistic given each year by the USSR--has little useful-
ness as an indicator of either the level or the trend
of Soviet defense spending. For example, the announced
defense budget declined in 1974, but actually there were
major increases in Soviet military procurement programs
and a large military pay raise.
In addition, some major items are not included in
the announced figure. The most. significant of these is
military research and development. Most military re-
search and development is funded under the "science" cat-
egory of the state budget. The Soviets have not yet an-
nounced a budget figure for science for 1975.
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National Intelligence Bulletin
December 19, 1974
A strongly worded Soviet condemnation yesterday of
efforts to link US economic relations with Soviet con-
cessions on emigration apparently was intended to get
Moscow's position firmly on, the public record prior to
final action by the US Congress on the trade bill.
The Soviets may have calculated. that a last-minute
reaffirmation of their position would not unduly jeopar-
dize passage of the bill. In the meantime, they have
set forth a public position so that if emigration rates
do not come up to expectations, the Soviets cannot be
said to have reneged on a promise.
Tass, in an authoritative statement, cited "leading
circles" in the USSR as flatly rejecting any attempts
at interference in Soviet internal affairs. In addition
to the emigration issue, Moscow criticized those who
were seeking economic information of a purely domestic
nature. This is probably a reference to Soviet reluc-
tance to exchange data on agricultural crop status and
trade requirements.
To underscore this message, Tass also carried, in
English and Russian, a letter on the emigration question
from Foreign Minister Gromyko to Secretary Kissinger
dated October 26. In the letter, Gromyko denied that
any agreement exists on numbers of emigrants, and he
reiterated the Soviet position that the number of people
who wish to emigrate from the USSR is declining.
The Tass statements represent Moscow's first exten-
sive commentary on the trade and emigration issue since
the trade reform bill was approved by the US Senate last
Friday and sent to a conference committee preliminary to
final approval by both houses.
The Soviet leaders may have felt that the state-
ments were necessary to counter any suspicions in the
USSR or elsewhere that the Kremlin had shown weakness
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National Intelligence Bulletin
December 19, 1974
in dealing with Washington on this issue. This show of
sensitivity is reminiscent of the attack against outside
interference that Brezhnev made at a dinner for Treasury
Secretary Simon on the eve of the compromise announce-
ment last October.
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National Intelligence Bulletin
PORTUGAL
December 19, 1974
The government, through the news media, has widely
publicized the US offer of economic aid and stressed its
political significance.
All newspapers have carried the full text of the
joint statement that was prepared in response to Presi-
dent Costa Gomes' request for a positive demonstration
of US support. In a televised address, the President's
top aide said the offer represented an act of political
support from an ally and old friend. Foreign Minister
and Socialist Party leader Mario Soares said that the.
offer reflects US confidence in Portugal's future and.
that its political significance far outweighs its eco-
nomic content.
The US offer is the first foreign government eco-
nomic aid and is not linked to the Azores bases negotia-
tions. In addition to direct assistance totaling more
than $220 million, the US will support Portugal in gain-
ing economic assistance from international organizations
and urge other friendly countries to provide aid.
Although this initial aid offer falls considerably
below the $160 million in grant aid and $260 million
for armed forces modernization that were suggested by
Soares several months ago, the US offer has been well
received. Lisbon will expect the US to be more forth-
coming, however, in negotiations for extension of the
Azores bases agreement.
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National Intelligence Bulletin December 19, 1974
President Makarios is moving to consolidate his
position within the Greek Cypriot community prior to re-
suming the intercommunal talks.
According to the US embassy in Nicosia, Makarios is
moving ahead cautiously to reimpose his control over the
Greek Cypriot sector, but is attempting to avoid provok-
ing his opponents on the far right or arousing the expec-
tations of his supporters. Since his return to the
island on December 7, the archbishop has held several
meetings with former acting president Clerides and other
Greek Cypriot leaders to solicit their views on the com-
position of his government and on a negotiating strategy
in talks with the Turkish Cypriots.
Clerides believes that Makarios is inclined to form
a government of national unity comprised of individuals
representing all political interests. The ministers,
however, would not serve as official representatives of
any group or be responsible to them. Such an arrangement
would permit Makarios to choose only those individuals
on the far left or far right who placed their loyalty to
him above their respective political parties.
Clerides reportedly is attempting to persuade Ma-
karios to select a cabinet consisting largely of tech-
nicians and civil servants in order to deal more effec-
tively with the many problems confronting the Greek
Cypriot sector. Clerides suggested to Makarios that
such a cabinet could be assisted by a separate "advisory
roups
al
liti
g
c
board" composed of the leaders of all po
to counsel the archbishop on the negotiations with the
Turkish Cypriots.
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National Intelligence Bulletin
December 19, 1974
Despite the outward show of unity displayed by the
black Rhodesian nationalists at the conclusion of their
talks early this month in Lusaka, the principal leaders
now seem preoccupied with outmaneuvering each other for
control of the new organization they all agreed to join.
Their jockeying is likely to intensify and may delay
the projected settlement talks with Rhodesian Prime Min-
ister Ian Smith.
When Joshua Nkomo of the Zimbabwe African Peoples
Union and Ndabaningi Sithole of the Zimbabwe African
National Union agreed to merge their insurgent groups
with the noninsurgent African National Council under
the chairmanship of council leader Bishop Muzorewa, the
organizational details and allocation of leadership
positions were left to be resolved at a future congress
of the newly enlarged council. According to the unity
declaration that the nationalists publicized on December
8, the congress is to be held within four months.
Some of the nationalists reportedly maintain the
congress must be convened before talks with Smith are
held. Others are said to fear that such timing will
only reveal the deep factionalism that exists among the
nationalists.
The key figures in the developing power struggle
seem to be Nkomo and Herbert Chitepo, the hard-line chief
of the Zimbabwe African National Union's guerrilla base
in Zambia. Chitepo appears motivated primarily by a de-
sire to bar Nkomo from leading the new unified movement.
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National Intelligence Bulletin
December 19, 1974
The other nationalist leaders seem to be lining up
with one side or the other. Several of them claim some
degree of tribal support in Rhodesia, and they hope to
draw upon this when a congress of the African National
Council is held.
Promotions and assignments being made in the army
reflect a changing relationship between the government
and those elements of the army considered non-Peronist.
Of 14 new brigadier generals, only one is consid-
ered to have Peronist ties. Most key command assign-
ments will now be in the hands of non-Peronist officers.
The decision of the Peron government to promote
officers on merit rather than on their political sym-
pathies probably reflects the government's realization
that the army must not be pushed too far. The assassi-
nation of ten army officers by the People's Revolutionary
Army, coupled with the reluctance of army commanding
General Anaya to press for a full-scale antiterrorist
role by the armed forces, has resulted in lower morale.
This present governmental position contrasts with
Congress' refusal in December 1973 to approve four colo-
nels for promotion, primarily because of their alleged
anti-Peronist political sympathies. This led to the
resignation of the then army commanding general and the
appointment of Anaya, who has been a malleable and non-
political commander.
The government would like to have an army commander
with Peronist sympathies, but the strengthened position
of the non-Peronist officers makes this unlikely. Luis
Gomez Centurion, a former military attache to the US
and a non-Peronist, has played a significant role in
the government's successful antiterrorist campaign in
northeastern Argentina, and he would be a popular choice
within the army. He will become the ranking major gen-
eral and next in line for this position on January 1.
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National Intelligence Bulletin December 19, 1974
CUBA-UN
Cuba has been inching its way back into the Latin
American regional group at the UN, from which it has
been excluded since the early 1960s.
Havana is likely to win its bid for the Latin Amer-
ican seat vacated by Venezuela on the committee for de-
colonization, over objections from some of the regional
group members. Cuba rebuffed the group on its offer of
a seat on the World Food Conference in exchange for with-
drawing its bid for the decolonization committee. Cuba's
special interest in this committee probably relates at
least partly to its repeated efforts to inscribe the "co-
lonial case of Puerto Rico" on the decolonization agenda.
Despite the Latin Americans' endorsement of Guate-
mala for the seat, General Assembly President Bouteflika
plans to take advantage of his discretionary powe-r--to
appoint Cuba, which submitted its bid first. Some Latin
delegates are continuing to argue that since Cuba was
elected to another UN post as an East European - socialist:
candidate, it has forfeited a claim to the Latin group.
Their argument is unlikely to persuade Bouteflika, who
appears to have made a commitment to Havana's delegate.
This spring, for the first time in over ten years,
Cuba was invited to cosponsor an initiative originating
with the Latin group. Soon after that, Peru ceded to
Cuba its place on the Group of 77 negotiating team for a
conference with the developed countries. In October,
furthermore, Cuba was elected as a Latin representative
on the UNESCO executive board.
Meanwhile, the OAS has moved a step closer to lift-
ing sanctions against Cuba. The working group drafting
amendments to the Rio Treaty gave unanimous support to
changing the voting requirement so that sanctions can
be lifted by a simple majority. It was the current
two-thirds requirement that stymied the effort last month
at Quito. The Rio Treaty amendments will be forwarded
for action to the OAS General Assembly next April.
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National Intelligence Bulletin December 19, 1974
SOUTH VIETNAM
The Communists are continuing to pressure South
Vietnamese forces in the southern half of the country,
while sporadic activity continues in the north.
In Communist-controlled areas of Phuoc Long Prov-
ince, northeast of Saigon, government local forces have
recaptured recently lost positions, but the Communists
still threaten the population centers.
Elsewhere in the provinces around Saigon, pressure
has slackened, but Communist units continue to interdict
roads and ambush government forces and have increased
their rocket and mortar attacks. These actions are de-
signed to harass the South Vietnamese and keep them on
the defensive while Communist forces regroup for another
round of attacks, to which they may commit divisional
units.
In the delta, the most recent fighting has been
around the capital of the newly created Hung Long dis-
trict, in the southern part of Chuong Thien Province.
On December 16, after nearly two weeks of fighting, the
Communists seized Hung Long, the first district capital
to be captured in the delta. In an abortive effort to
save Hung Long, the South Vietnamese airlifted elements
of two regiments into the area. Other government outposts
in marginally controlled areas also have been targeted by
the Communist local forces.
Fighting has lessened somewhat in Kien Tuong Prov-
ince, near the Cambodian border. Activity will probably
pick up, however, after the Communists have resupplied
their units. The South Vietnamese have moved reinforce-
ments into the area in an attempt to thwart the Commu-
nists' effort to seize the rice harvest and secure their
infiltration routes.
Communist activity in the northern provinces of
the country has been limited primarily to reaction to
the government's clearing operations in a mountainous
area of Thua Thien Province. To the south, in several
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National Intelligence Bulletin December 19, 1974
smaller actions against territorial forces, the Commu-
nists may have succeeded in opening a resupply corridor
to three local battalions in eastern Quang Ngai Province.
The US and other backers of South Korea have blocked
North Korea's attempt to win UN support for its campaign
to get US troops out of the peninsula.
By a comfortable margin, the General Assembly on
Tuesday accepted its Political Committee's resolution
calling on the Security Council "in due course" to con-
sider the question of the UN--and, by implication, the
US--military presence in South Korea. The opposing
resolution, which called outright for US troop withdrawal,
had been defeated in a tie vote in the Political Commit-
tee, and Pyongyang's backers made no move to reintroduce
it at Tuesday's plenary session. Also, Pyongyang's
backers were not receptive to a last-minute effort by
Nordic nations to work out a compromise incorporating
elements of both resolutions.
The outcome is a setback to North Korean hopes of
marshaling a UN majority with Third World support against
the US military presence in South Korea. Pyongyang,
however, made effective use of the months of backstage
diplomatic preparation and the week or so of committee
debate on the issue to call attention to the dual legal
status of US forces in Korea. One recent result has
been a private Japanese request for details of the
structural relationship between the UN Command and US
forces stationed in South Korea.. US bases in Japan serve
UN as well as US military needs.
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National Intelligence Bulletin
December 19, 1974
USSR: Nikolay Baybakov, head of the USSR State
Planning organization, reported to the Supreme Soviet
yesterday that this year's grain crop amounted to 195.5
million tons--1Q million tons short of the target.
Nevertheless, Baybakov touted the crop as second only
to last year's record crop of 222.5 million tons. He
blamed bad weather for the reduced output.
Korea: Seoul has admitted that an abandoned, heav-
ily damaged North Korean boat towed into a South Korean
port earlier this week is not an agent infiltration boat
but a fishing vessel. The South Koreans say they will
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