THE PRESIDENT'S DAILY BRIEF 5 JANUARY 1973

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0005993708
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: January 5, 1973

Declassified in Part- Sanitized Copy Approved for Release 2016/06/14 : CIA-RDP79T00936A011500010004-5
The President's Daily Brief
5 January 1973
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Exempt from general
declassification schedule of E.O. 11652
exemption category 513(1).(2),(.3)
declassified only on approval of
the Director of Central Intelligence
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FOR THE PRESIDENT ONLY
THE PRESIDENT'S DAILY BRIEF
5 January 1973
PRINCIPAL DEVELOPMENTS
President Lon Nol has told Ambassador Swank that
his government now may have a channel to the Khmer
Communists and that the modalities have been dis-
cussed with Soviet representatives.
(Page 1)
Meanwhile within his government, the President's
brother, Lon Non, appears to be maneuvering against
two key figures. (Page 2)
The impasse over Malta's demands for additional
payment for the British facilities continues, with
Italy pressing for increased contributions by all
NATO participants in the arrangements except Brit-
ain. (Page 3)
On Page 4 we discuss Fidel Castro's new agreements
for continuing substantial economic aid from the
USSR.
Venezuela may be preparing to ship some petroleum
to Cuba. (Page 5)
A top Chilean Communist figure has stressed the
indispensability of continued military participa-
tion in the Allende government. (Page 6)
The Panamanian Government is about to proceed with
its request that the UN Security Council meet in
Panama City in March. (Page 7)
A Soviet decree on aircraft hijacking calls for
the death penalty in some circumstances. (Page 8)
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CAMBODIA
In a conversation with Ambassador Swank on 3
January, President Lon Nol expressed some rare in-
terest in establishing a high-level political dia-
logue with the Khmer Communists. The Cambodian
leader stated that the government now may have a
channel to the insurgents, and added that the mo-
dalities of contacting them have already been dis-
cussed with Soviet representatives in Phnom Penh.
First Minister. Hang Thun Hak claimed that
he has "very recently" made contact through an un-
identified intermediary with Sihanouk's "minister
of interior," Hou Youn, who allegedly has been op-
erating in the countryside since the early days of
the war. Hak said that, although this link had not
yet produced anything significant, he was encouraged
that it would eventually result in a substantive
dialogue.
The Soviets recommended
that Phnom Penh agree to the establishment of a legal
Communist party which would take part in new national
elections and be included in a new government. Hak
passed these concessions on to Lon NOl, endorsing
them in the process. According to Hak, the Presi-
dent first reacted unfavorably but eventually agreed
to permit him to proceed. "as he saw fit for the time
being."
Lon NoZ's new-found concern with the polit-
ical aspects of the Khmer Communist prob-
lem may stem from recognition that his
primary approach so far--the rallier pro-
gram--is likely to continue to be unsuc-
cessful. He may also be curious to learn
the Khmer Communists' private terms for
negotiating, particularly whether they
would be willing to disavow Sihanouk.
Publicly, the Communists have shown no
sign of any willingness to compromise.
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CAMBODIA
President Lon Nol's brother, Brigadier General
Lon Non, who has steadily expanded his role in the
government, now appears to be maneuvering against
two key government figures--First Minister Hang
Thun Hak and the able Army Chief of Staff, Major
General Sosthene Fernandez.
Lon Non has ordered that First Min-
ister Hak be investigated for "leftist" activities.
General Fernandez claims that Lon Non is circulating
rumors that Fernandez is plotting a coup against the
president. Fernandez says these allegations have
cost him much of Lon Nol's confidence, thereby com-
plicating his efforts to implement badly needed
military reforms.
The government can ill afford the loss of
Hak or Fernandez or the political stress
that would result from their departures.
If Lon NoZ does not soon put his brother
on a shorter leash, his o,wn ebbing popu-
larity is likely to decline further--
particularly among the military.
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MALTA
Prime Minister Mintoff continues to demand
that if British facilities are to remain, Malta
must receive an additional $3.4 million inCash as
compensation for losses suffered- when the pound
floated. The North Atlantic Council yesterday
failed to agree on any new offer. Italy has been
pressing for increased contributions of some $2 mil-
lion by all participants except the MC:
Mintoff is under pressure from his cabinet and
party to avoid a Completebreak,with the UR. In an
effort ,to reduce that pressure by suggesting that
he has an alternative, he flew to Tripoli yesterday.
Mintoff. is aware, however, that even a large Libyan
subsidy would not sOlve the problem of employment
for the nearly 6,000 workers dependent on the Brit-
ish presence.
Mintoff may well betieve-that the allies
will bow to'his demands as they did last
year. Operating on this premise, he may
lock himself into a posture from which
it will be politically impossible to re-
treat, and so bring about a Britis.hde-
.parture regardless of the effect this,
would have on his country's fragile econ-
omy.
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Soviet Artist's Concept of
Typical Intersputnik
Ground Station
553956 1-73 CIA
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USSR-CUBA
Agreements concluded during Fidel Castro's
recent visit to Moscow give Cuba another $370 mil-
lion for development aid and a grace period until
1986 for repaying its $3.5 billion debt to the USSR.
Moscow also agreed to continue financing for at
least the next three years Cuba's annual trade def-
icit with the USSR, which has been averaging some
$350 million annually. This deficit, however, will
be reduced by the Soviet offer to nearly double
the price it pays for Cuban sugar and nickel.
The new agreements represent Moscow's
recognition that Cuba cannot meet its
debt obligations and that a renewed ef-
fort, however costly, is needed to ra-
tionalize and develop its sluggish econ-
omy. The Soviets have chafed at the poor
performance of the Cuban economy despite
large and increasing infusions of aid.
Since 1970, Castro has been more recep-
tive to Soviet advice and seems to have
reduced his own meddling in economic
matters. His enthusiasm about the agree-
ments, however, may be tempered by the
realization that they tie his country
more closely to the USSR and will restrict
his freedom of action in political mat-
ters.
When the station is operational,
probably by the end of the year, it will signifi-
cantly improve both civil and military communica-
tions between Havana and Moscow.
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VENEZUELA-CUBA
Two leading officials of President Caldera's
party are now saying that Venezuela is prepared to
Ship some of its petroleum to Cuba "if the Cuban
Government offers good prices and favorable condi-
tions of payment." One official told a party rally
in late December that Venezuela was negotiating with
the USSR to provide part of the petroleum which Mos-
cow supplies to Cuba. Some press reports claim that
shipments may be up to 100,000 barrels a day.
This amount would be little more than
three percent of Venezuelan production,
but would satisfy over 75 percent of Cuba's
import requirements.
Since coming to office in March 19693 Cal-
dera's Christian Democratic government has
moderated the strident anti-Castro tone
of earlier government statements. Ex-
changes of low-level delegations are in-
creasing, and a Prensa Latina office has
been allowed to operate in Caracas. More
recently a telephone Zink has been in-
augurated.
An accommodation with, Cuba would meet with
little opposition in Venezuela. There are
differences over timing, but almost all
political parties favor a rapprochement.
Few military leaders favor ties with Cuba,
but they would be unlikely to mount any
strong opposition to such a move.
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CHILE
In a year-end briefing of fellow Communist
leaders, Labor Minister Figueroa emphasized the
indispensability of military participation in the
government and the positive contributions of the
officers involved.
Throughout his briefing, Figueroa showed the
pragmatism that has made the Communist Party Pres-
ident Allende's most valuable political ally. He
dwelt heavily on the inefficiency, dissension, and
disorganization of the Popular Unity parties and
warned that these defects will help the opposition
in the congressional elections on 4 March.
While the Communists and the armed forces
undoubtedly share concepts of authority
and discipline, their basic mistrust of
each other's power remains.
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PANAMA
Within the next few days the Torrijos govern-
ment plans formally to ask the United Nations Secu-
rity Council to meet in Panama City from 15 to 21
March, according to UN sources. With 11 of the 15
council members firmly in favor of such a meeting,
Panama has more than enough votes to carry the mo-
tion. It has not submitted an agenda but plans to
focus attention on the canal negotiations as a major
issue.
Having put the details of the negotiations
in the public record last month, General
Torrijos may believe that he can go into
some depth on Panama's efforts to gain
control of the Canal Zone without creating
the kind of diplomatic bombshell that
might harm Panamanian interests. Torrijos
is likely to wait until the last minute,
however, before deciding how far Panama
will go in attacking the US at the meet-
ings.
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NOTES
USSR: A Soviet decree on aircraft hijacking
calls forthe death penalty in cases involving death
or serious injury and for prison terms of up to 15
years and confiscation of property in other instances.
The decree seems intended primarily to show other
governments that Moscow is concerned over a serious
international problem. The Soviet Union, however,
will not support the US draft convention, providing
for stiff sanctions against countries that harbor
hijackers, which will be discussed next week by the
International Civil Aviation Organization. Moscow
believes that international sanctions should be im-
posed only by the UN Security Council, where it has
a veto.
USSR:
the Soviets have increased the
number of tanks in their active field forces beyond
our current estimates. The standard number of tanks
in the tank battalion of Soviet motorized rifle regi-
ments is being increased from 31 to 40. An addi-
tional tank battalion--beyond those organic to the
regiments--is now directly subordinate to some So-
viet motorized rifle divisions in Eastern Europe.
Depending on the extent to which these changes have
been implemented, Soviet ground forces in Eastern
Europe may now have from 500 to 1,200 more medium
tanks than the 7,800 currently listed in our esti-
mates. In the China border area, there may be'some
9,000 Soviet medium tanks rather than the previous
estimate of 8,100.
Uganda: President Amin's announcement yester-
day of the seizure of a large number of British com-
panies will speed the departure of the 3,000-person
British community and perhaps other Westerners as
well. The president has labeled his moves against
the British, as well as his expulsion of the Asians
and Israelis, as an effort to put the economy in the
hands of Ugandans. The trend is toward replacement
of the West as a source of aid by Arab and Eastern
benefactors.
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Top Secret
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