TRANSMITTAL OF DOCUMENTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00702A000200110003-3
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 45
• Document Creation Date: December 20, 2016
• Document Release Date: February 25, 2004
• Sequence Number: 3
• Publication Date: December 28, 1978
• Content Type: MF

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Foreign
Assessment
Center
Communist Aid
To Less Developed Countries
Of the Free World, 1977
A Research Paper
ER 78-10478U
November 1978
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Communist Aid to Less Developed Countries
of the Free World, 1977
Central Intelligence Agency
National Foreign Assessment Center
Key Judgments
The USSR reinforced its Third World connections in 1977 with military
sales agreements of near-record size and economic pacts that seemed to
ensure long-term Soviet involvement in several key less developed countries.
Moscow once again focused on military aid as its most effective means of
building up influence in the Third World. At the same time, the USSR
expanded economic and technical cooperation with LDCs in order to
consolidate political gains and to assure markets and raw material supplies
for various branches of Soviet industry.
Despite Moscow's apparent preoccupation with sub-Saharan Africa-
where its Cuban surrogates played an increasingly important role-three-
fifths of the $4 billion military commitment in 1977 went to support radical
Arab regimes, Moscow's traditional arms clients.
Moscow's most decisive supply action was in the Horn of Africa.
Following political decisions made in 1976, the USSR shifted its alliance
from Somalia to Ethiopia in an arms buildup unprecedented in size or
character in the sub-Sahara. Meanwhile, the USSR gave more active support
to African insurgent groups through new and heavier assistance. The 21,000
Cuban military personnel in black Africa at yearend (almost twice the
number at yearend 1976) were further testimony of Moscow's heightened
interest in the area.
The record $3.3 billion in Soviet military deliveries in 1977 featured a
larger proportion of advanced weapons systems and naval craft. Egypt's
ongoing peace initiatives toward Israel provided Moscow further opportuni-
ties to cement relations with Algeria, Libya, and Syria-members of the
"Steadfastness Front" opposing accommodation with Israel.
In 1977, the USSR and East European countries signed 19 economic
framework agreements with LDCs, the majority to be implemented over 10 to
15 years. The amount and kind of assistance for specific projects and the
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terms of repayment are to be negotiated separately. ,hey may include
conditions ranging from straight commercial transactions to liberal long-term
provision of aid. The agreements shift the burden for formulating viable new
projects to the developing country.
The USSR hopes by these economic aid agreements> to quiet growing
Third World discontent with the level and character of Soviet assistance.
Moscow also expects return benefits, mainly in the form o.' (a) establishment
of markets for Soviet goods and (b) securing new source:. of foodstuffs and
industrial raw materials such as bauxite, iron ore, and phosphates. East
European countries are particularly interested in concludic.g agreements with
the LDCs that will provide future oil supplies, since their increased needs
almost certainly will not be met by the USSR.
In 1977, Communist economic aid commitments fell to their lowest point
in nearly adecade-only $875 million in new credits. The most precipitous
drop was in the Soviet program, as Moscow pledged less t~?~an $400 million of
aid, mostly to India. The decline in the value of new aid e~ctensions, however,
should not be interpreted as a switch in policy since ~~.id deliveries were
5 percent higher in 1977.
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Key Judgments ........................................................................................ i
The Military Program in 1977 ................................................................ 1
A Near-Record Year ............................................................................ 1
Little Change in Client Pattern .......................................................... 1
Arab States: Economic as well as Political Payoff to USSR ............ 1
African Clients: Political Considerations Paramount ........................ 2
Other LDC Clients ................................................................................ 2
Deliveries at a Record Pace ................................................................ 2
Military Technical Services .................................................................. 2
LDC Trainees in Communist Countries .............................................. 3
The Economic Aid Program in 1977 ...................................................... 4
Soviet Aid: Few New Initiatives .......................................................... 7
Commercial Accords Expanded ............................................................ 8
Other Communist Aid .......................................................................... 8
Technicians ............................................................................................ 8
Technical Training ................................................................................ 10
Academic Students ................................................................................ 11
Appendix A
Country Sections ........................................................................................ 13
1. Communist Military Relations with LDCs ...................................... 1
2. Communist Military Technicians in LDCs, 1977 ............................ 3
3. Military Personnel from LDCs Trained in Communist
Countries, 1956-77 .......................................................................... 4
4. Communist Economic Credits and Grants Extended to LDCs ...... 5
5. Communist Economic Aid to LDCs ................................................ 6
6. Communist Economic Technicians in LDCs, by Country, 1977 .... 9
7. Academic Students From Selected LDCs Being Trained in
Communist Countries as of December 1977 ................................ 11
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Communist Aid to Less Developed Countries
of the Free World, 1977
The Military Aid Program in 1977
A Near-Record Year
Large sales to traditional clients and massive
support to Ethiopia pushed Communist arms
sales to LDCs to anear-record $4.2 billion in
1977 and arms deliveries to a peak $3.6 billion
(see table 1). Only in 1974, when Moscow was
restocking Middle East inventories, were mili-
tary sales higher. Transactions in 1977 raised
total Communist sales to LDCs since the mid-
1950s to almost $30 billion. In 1977, as in
previous years, the USSR accounted for the
lion's share of the Communist program (95
percent of sales and 91 percent of deliveries), and
Moscow continued as the second-ranking LDC
arms supplier, after the United States. East
European countries and the People's Republic of
China contributed only $220 million in new
agreements.
Little Change in Client Pattern
A few large arms sales dominated the Soviet
military aid picture again in 1977, with five
clients-Syria, Algeria, Ethiopia, India, and
Libya-accounting for almost 90 percent of the
sales. The Soviet commitment to furnish $2
billion of arms to Algeria, Libya, and Syria
bolstered the hard-line stance of these countries
against Egyptian peace initiatives. The USSR's
sales of modern weaponry to these radical Arab
clients have been motivated by political consider-
ations; the substantial hard currency earnings
from the sales are a highly attractive secondary
consideration. In 1977 the USSR broke the
Western arms supply monopoly in the conserva-
tive Persian Gulf states with a $50 million cash
sale of missiles and rockets to Kuwait.
Arab States: Economic as well as Political
Payoff to the USSR
The Soviets made few known financial conces-
sions to large clients last year, either in pricing
arrangements or repayment terms. In all, the
Soviets will gain perhaps $1.5 billion in hard
currency from 1977 arms sales. These earnings
come at a particularly opportune time-follow-
ing the large hard currency trade deficits of
Communist Military Relations with LDCs'
Total' ..........
1954-67 ....
1968............
1969............
1970............
1971............
1972............
1973............
1974............
1975............
1976............
1977............
Total
USSR
Eastern
Europe
China
29,28(1
28,050
2,420
810
6,025
5,045
755
225
535
450
60
25
485
360
125
5
1,265
1,150
50
65
1,790
1,590
120
80
1,865
1,635
150
80
2,965
2,810
130
25
4,690
4,125
480
85
2,260
2,010
215
40
3,195
2,890
160
145
4,205
3,990
180
40
Total
USSR
Eastern
Europe
China
23,885
21,035
2,130
700
4,910
4,080
680
150
595
505
65
25
555
450
80
25
1,105
995
80
30
1,045
865
120
60
1,360
1,215
70
75
3,330
3,130
120
80
2,485
2,315
150
25
2,090
1,775
230
85
2,815
2,445
290
80
3,570
3,265
240
65
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1975-76-and reduce pressures on the USSR to
cut back imports of badly needed equipment,
grain, and semimanufactures from the West.
The Soviet-Syrian relationship, which had de-
teriorated in 1976 during the Lebanese crisis,
was rekindled last year with new military agree-
ments. Iraq followed its $1 billion 1976 order
with purchases of long-range jet transport air-
craft (IL-76s) never before exported by the
USSR.
Algeria plans to modernize its inventories fur-
ther with the squadron of MIG-23 fighters that
Moscow is providing under the 1977 agreement.
It will use the additional tanks and combat
vehicles to reorganize its ground forces into
mobile units better suited to desert warfare.
African Clients: Political Considerations Paramount
The Soviet venture into Ethiopia was frankly
political. Rising international criticism did not
deter Moscow's continuing sub-Saharan offen-
sive, for which military agreements in 1977
soared to $850 million, triple the 1975 level (the
year of the Angolan insurgency). The record-
setting transactions represent the largest Soviet
commitment ever made to black Africa and
reflect a major shift in Soviet policy in the Horn
of Africa. Soviet agreements for equipping Ethi-
opia with modern weapons was accompanied by
(a) Moscow's refusal to ship offensive weapons to
Somalia, (b) Mogadiscio's abrogation of the
1974 Somali-Soviet friendship treaty, (c) Somali
withdrawal of Soviet rights to naval and air
facilities in Somalia, and (d) the expulsion of
1.,500 Soviet advisers from Somalia.
Other LDC Gients
In South Asia, India continued its long de-
pendence on the Soviet Union with arms orders,
which include licensed production of MIG-21 bis
aircraft in India, and continued Moscow's assist-
ance for Indian defense production begun in the
1960s. India's cumulative military purchases
from the USSR stood at $3 billion at yearend
1977.
Deliveries at a R~~KOrd Pace
The USSR shi~~ped LDCs an unprecedented
$3.3 billion worth of military equipment last
year, almost sev ~n times Moscow's average
annual deliveries :o LDCs in the late 1960s and
almost twice the ~_werage 1970-76 deliveries. At
yearend 1977, the Soviets had delivered a total of
$21 billion of weapons to the LDCs, about 80
percent of its totaa commitment.
Three Arab customers-Iraq, Libya, and
Syria-were ama:ng the top five recipients in
1977, along with India and Peru. Collectively,
the five accounted for about 70 percent of Soviet
deliveries. Ethiopia and Algeria were also major
recipients. Mosco?,v also made its first deliveries
of important wea;~onry to Peru and Ethiopia-
SU-22 fighter/bo::nbers to Peru and MIG-21 bis
to Ethiopia.
Military Technical) Services
Approximately 33,000 Communist military
personnel were in LDCs in 1977 to assemble and
maintain equipment and to instruct local units in
combat technique: and the maintenance of new
weapons. In the ease of Angola and Ethiopia,
Cubans were en?:aged in actual combat. The
preponderance of Cuban personnel and their
overwhelming concentration in sub-Saharan Af-
rica is shown in .able 2.
The 50-percent rise in the number of military
personnel in LDCs in 1977, compared with 1976,
was almost entirely attributable to a near dou-
bling of the Cuban contingent in Angola, where
in addition to the: usual advisory services, many
were directly involved in combat support. Others
worked in Angoh~ before being transferred else-
where. For example, a thousand Cubans were
moved to Ethiopi