STAFF NOTES: WESTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001000030001-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 20
• Document Creation Date: December 20, 2016
• Document Release Date: August 19, 2005
• Sequence Number: 1
• Publication Date: May 16, 1975
• Content Type: REPORT

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Portuguese Moderates Dealt Setback .
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West Berlin Morale Shaken
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Soviets Weigh In on Finnish Political
Situation . . . . . . . . . . . . . . . . . 8
Spain Acts To Ease Labor Unrest . . . . . . . 9
"Leap Forward" for EC Commercial Policy? . . . 11
Turkish Coalition Government Off to
Good Start . . . . . . . . . . . . . . . . . 13
ANNEX
Jockeying for Position Over the Spanish
Sahara . . . . . . . ... . . . . . . . . . . 16
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May 16, 1975
DOS review(s) completed.
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Portuguese Moderates Dealt Setback
Moderates in the Armed Forces Movement
have suffered a setback with the forced resig-
nation yesterday of General Mendes Dias, the
air force chief of staff and member of the
Revolutionary Council.
Mendes Dias' resignation comes as no sur-
prise since his moderate views made him suspect,
especially after the abortive March 11 coup.
Moderate officers in the Movement had hoped
that the popular strength demonstrated by the
Socialists and the Popular Democrats in the
constituent assembly election would give them
increased leverage in the Council. So far,
however, they have had little success in making
their influence felt.
In a communique released by the Revolution-
ary Council, Mendes?Dias was criticized for "de-
ficiencies" in command during the coup attempt,
but he was not accused of complicity in the
plot. The Council stated that his loyalty to
the Movement is not in question.
Press reports
speculate t at t h e Council's rebuke was inten-
tionally mild to avoid antagonizing the air
force, which is inclined to support the moder-
ates.
The Portuguese media indicate that the
commander of the Lisbon air region, General
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Pinho Freire, also submitted his resignation
out of loyalty, but the Council's decision on
this matter has not been announced.
The new chief of staff is Colonel Morais
da Silva, until recently a major who assumed
command of an air base in the aftermath of the
abortive coup. As chief of staff, he is pro-
moted to the rank of general.
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May 16, 1975
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West: Berlin Morale Shaken
Decisions announced this week by two large
US firms to cut their operations in West Berlin
have caused concern there that US commercial
interests may be losing faith in the future
of West Berlin.
The basis for the current concern were reports
appearing in West Berlin newspapers on May 13 and
May 15 that National Cash Register (NCR) and
Pitney Bowes--both hard hit by the recent business
downturn--planned to cut Berlin operations in favor
of centralized operations from their plants in West
Germany. The moves will idle nearly 1,000 workers
in West Berlin.
Officials of both firms have denied that political
factors motivated their decisions, but early reactions
in West Berlin indicate that neither political nor trade
union leaders are convinced. While West Berlin polit-
ical. leaders have'taken a public position-that the
decisions reflect a decline of the US commitment to
Berlin, some have told US Mission officials privately
that. they doubt the decisions were based wholly on
economic grounds. Trade union leaders have been even
more outspoken. A spokesman for the large Metal
Workers' Union (IG Metall) claimed earlier this week
that. the real reason for the NCR move to its Augsburg,
West. Germany, plant was the firm's lack of faith in
the US commitment to Berlin based on recent US per-
formance in SE Asia.
Although fears of diminishing US involvement
abroad may not gain general acceptance, the close
timing of the two announcements has encouraged a
political interpretation in West Berlin, where
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basic insecurity is always a major factor. The
US Mission will urge US businessmen in West
Berlin to coordinate their plans closely with
Berlin authorities to help forestall misinterpre_
tations,of this kind in the future. Some 100 other
US firms are: still operating in West Berlin, though
few are as important in terms of employment as NCR
and Pitney Bowes. F77 I
May 16, 1975
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Soviets Weigh In on Finnish Political Situation
Finnish President Kekkonen will announce
next Monday his plan:; for resolving the current
domestic political impasse. In a statement
on May 15, he assured foreign governments
that domestic political uncertainties would
not impede Finland's hosting the third stage
of the Conference on European Security.
The break up of the present coalition,
deeply divided over a host of issues, has
appeared imminent in recent weeks. During
his visit to the USSR last week, however,
Foreign Minister Kar_jalainen was warned by
President Podgorny that Finnish political
instability could give opponents of European
security an excuse to postpone the third con=
ference stage planned for this summer.
Prior to the Soviet warning, Finnish
leaders assumed that: once the coalition resigned
an interim non-polit::_cal government would
preside until elections in late summer or
early fall. Now, however, some Finns are
talking of retaining the coalition on a care-
taker basis and utt:=_n off an election until
next spring.
May 16, 1975
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Spain Acts To Ease Labor Unrest
The Spanish government has made two moves
to ease labor tension, but its actions may be
a case of too little too late.
The labor minister announced last week
that the cabinet had approved a long-awaited
decree that makes strikes legal for the first
time under the Franco regime. The new law
provides for legal strikes only as a last re-
sort after various prescribed mediation and con-
ciliation steps have been taken. A strike will
be considered legal if it deals with a dispute not
covered in government-approved labor management
contracts and follows a secret ballot in which a
minimum of 60 percent of the workers affected
have voted to strike. Written advance notice
of five working days following a favorable vote
must be given to the government. During that
time, the government will try to settle the dispute.
The following strikes would not be permitted:
all politically motivated strikes, all solidarity
strikes by workers or others not involved in the
specific labor disputes, all strikes involving
worker sit-ins, strikes at any public services
or installations related to national defense, and
any wildcat strikes not following prescribed pro-
cedures.
Given these restrictions, there may be few
legal strikes in Spain. The new law is thus only
a small victory for those wanting to liberalize
the government-controlled labor system. Although
it was a concession for the government even to use
the word strike in the decree--a word Franco has
not previously permitted--the new decree is unlikely
to satisfy critics of the Spanish system at home
or abroad.
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In an additional effort to ease tensions,
the government-controlled Syndical organization
finally announced that elections for shop stewards
will be held in June. Most clandestine labor
organizations, from the Communist-dominated Workers'
Commissions to the moderate Catholic-oriented
Spanish Workers Un.i:)n--but not the Socialist General
Workers Union which refuses to participate--plan
to run candidates in a move to penetrate the official
labor organization at the plant level. This activity
may substantially diminish the recent strike activity
as workers concentrate their attention on the
elections.
May 16, 1975
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"Leap Forward" for EC Commercial Policy?
Immediately upon his return to Brussels
after a one week trip to Peking and Tehran,
Stir Christopher Soames, EC Commissioner for
foreign relations, announced his intention
to seek "economic cooperation agreements"
with China, Iran, and, eventually, with the
Eastern European states.
The economic cooperation agreement the
EC is now negotiating with Canada would
serve as a model for these agreements. The
non-preferential agreement will include
provisions for cooperation in the industrial
and environmental areas and set up formal
consultation procedures. The EC views the
Canadian agreement primarily as a means of
guaranteeing European access to raw materials
in exchange for EC technology.
Soames hopes that once the Canadian
arrangement is concluded, the competency of
the commission to negotiate such broad agree-
ments will be established. The commission
will then seek authority to negotiate similar
arrangements between the EC and state-trading
countries. How much success Soames will have
is uncertain. The EC members have up till
now refused to enlarge the jurisdicion of
the community's common commercial policy to
include cooperation agreements.
During his stopover in Tehran, Soames
pressed the Iranians to accept a non-prefer-
ential cooperation agreement similar to that
being negotiated with the Canadians. Tehran,
however, prefers special trade preferences
May 16, 1975
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along the lines of the EC-Mediterranean
accords. Agreement was, nevertheless, reached
to begin exploratory talks in June on a new
agreement: which will include provisions for
oil and refined products.
At at Brussels news conference,Soames ex-
pressed the hope that his China visit would
not
retard progress toward improved relations
with
the Council for Economic Mutual Assist-
ance
and individual Eastern European countries.
The
Commission surely figures, in fact,
that
the
talks: with China will spur Eastern
Euro-
pean
interest in their own arrangements
with
the
EC.
The initial Romanian reaction appears to
be favorable. ::Zlomanian officials want to
establish closer ties with the community, but
do not want to risk being the first communist
country (except for Yugoslavia) to enter into
a trade agreement with the EC or accord it
full political recognition. The Chinese deci-
sion to blaze the trail may increase the possi-
bility that Romania may follow suit. Bucharest,
however, would not want to follow Peking's lead
too closely because of Moscow's negative re-
action.
Under the EC's common commercial policy,
state-trading countries must recognize the
Commission's authority to negotiate trade
agreements. Romanian economic officials may
hope that by recognizing the EC they will gain,
among other things, more favorable'treatment
in negotiations, on an EC-Romanian textile
agreement and greater access to EC markets for
Romanian cotton goods.
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Turkish Coalition Government Off to
Good Start
After a little more than a month in of-
fice, the nationalist coalition government of
Suleyman Demirel has made a good start toward
achieving the major elements of its domestic
program.
The principal beneficiaries of the govern-
ment's measures are those groups that have
traditionally supported Demirel's Justice Party
such as farmers, labor and women. The main
opposition--former prime minister Ecevit's Re-
publican People's Party--made major gains among
these groups in the 1973 general election. The
government's measures will also probably win
support from government employees who have
generally favored the Republican People's Party.
So far, the governing coalition has exhib-
ited internal unity with Demirel in firm control,
although the leader of the National Salvation Party,
Necmettin Erbakan, has irritated Demirel's party
on occasion. Demirel has maintained his close contacts
with the crucial independent bloc of mostly former
Democratic Party deputies that gave him the necessary
support to win the vote of confidence on April 12.
For the time being, at least, Demirel has
little to fear from his opposition which has
been further weakened since the confidence vote.
The Democratic Party, in particular, has been
hit: hard by resignations and the party now has
only 27 deputies compared to the 45 elected on
its ticket in 1973. Ecevit would need to pick
up 11 votes, while holding the current opposition
forces in line in order to bring down the government--
an unlikely prospect at present.
May 16, 1975
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ANNEX -
Jockeying for Position Over the Spanish Sahara
The arrival. in Spanish Sahara this week of
an investigating, team of the UN Committee on
Decolonization has stirred action among the
parties contesting the disposition of the
territory. The team has already visited
Madrid and will cjo on to Morocco, Algeria, and
.Mauritania.
Recent allegations in the Spanish press
about secret conversations between Spain,
Morocco, and Mauritania for settlement of the
Sahara problem led Foreign Minister Cortina to
announce that Spain continues to support a
self-determination referendum under UN auspices.
A Spanish Foreign. Ministry official told the
US embassy that the press stories came from
certain Spanish officials who favor a negotiated
settlement that would take into account Moroccan
King Hassan's determination to annex the Sahara.
The arguments of these officials have been
weakened by Hassan's renewed claim to the Spanish
enclaves of Ceuta and Melilla in northern Morocco--
territories that Madrid says it has no intention
of relinquishing.
Cortina's formula reportedly has the full
backing of Franco. Madrid appears to believe
that a referendum would result in a vote in
favor of an independent state, which the Spaniards
could hope to control.
The Spaniards postponed their plans to hold a
referendum during the first half of this year as
a result of the adoption by the UN General Assembly
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last fall of a Moroccan-initiated resolution that
sent the dispute to the International Court of
Justice for an advisory opinion. The Court will
decide whether the Sahara was administered by any
government prior to Spanish occupation and, if
so, what legal ties existed then between the
territory and Morocco and Mauritania.
Spain, Morocco, and Mauritania have submitted
written briefs to the Court, which began hearing
the case on May 12. Algeria has notified the
Court it wishes to present its views as an interested
party.
A court opinion is expected next September
in time for the UN General Assembly session. Faced
with competing claims to the area, the Court may rule
that Spanish Sahara was an unadministered territory.
That would return the problem to the General Assembly,
which would probably recommend implementation of
existing resolutions that call for a UN-supervised
referendum.
Relations between Morocco and Algeria have
recently become strained again over the Sahara issue.
Algiers, which is determined to block Moroccan annex-
ation of the territory, supports the proposed refer-
endum, on the assumption that it would result in
independence for the area. Such a solution would
at once deny Morocco any form of control and open
the territory to Algerian influence.
.The two countries clashed over self-determination
for the Sahara at the Arab League foreign ministers
meeting in Cairo last month. The day after the
meeting ended, Hassan warned that Morocco would use
force, if necessary, to prevent "self-determination
in the Sahara." Hassan, however, still prefers a
settlement through bilateral negotiations.
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Mauritania, for its part, is continuing its
juggling act in the Sahara dispute. It does not
want to share a common border with Morocco and fears
Rabat might not he satisfied with the acquisition
of Spanish Sahara. In the past it has relied on
Algiers to defend its interests.
More recently Nouakchott has accepted a $15
million development loan offered by Rabat in an
obvious effort-to buy Mauritanian support on the
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Sahara. The Mauritanians will remain suspicious
of Moroccan intentions, however, and are unlikely
to risk offending Algeria by cultivating too
close ties with Rabat.
Ultimately, the dispute will probably be
settled through private negotiations among the
four interested parties. A compromise solution
based on partitioning Spanish Sahara between
Morocco and Mauritania may emerge. Spain and
Algeria would find it easier to agree if that
alternative can be worked into an option in the
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