WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A006500010001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 38
• Document Creation Date: December 20, 2016
• Document Release Date: June 13, 2006
• Sequence Number: 1
• Publication Date: June 7, 1968
• Content Type: SUMMARY

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Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
NAVY review(s) completed.
State Dept. review completed
Secret
441,
7 June 1968
No. 0023/68
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(Information as of noon EDT, 6 June 1968)
VIETNAM
Hanoi has significantly strengthened its delegation
in Paris with the arrival of ranking politburo mem-
ber Le Duc Tho and several technical specialists.
Major enemy action in South Vietnam centered on Sai-
gon as the Communists intensified their campaign of
harassment in and around the capital. In Saigon,
Prime Minister Huong sought both to set his new gov-
ernment in motion and to conciliate potential adver-
saries.
FIGHTING EASES IN LAOS
The fighting continues to taper off as Communist
forces move to a defensive posture in preparation
for an expected government counterattack during the
rainy season.
SOUTH KOREAN REGIME TORN BY INFIGHTING
The sudden resignation last week of government party
chairman Kim Chong-pil represents an unprecedented
break with President Pak Chong-hui's leadership and
confronts Pak with the prospect of a dissident fac-
tion loyal to Kim.
COMMUNIST CHINA'S LEADERSHIP STILL IN FLUX
Shifts in the relative positions of officials attend-
ing a major reception on 3 June in Peking indicate
that the leadership is still in a state of flux. In
the provinces, a revolutionary committee was finally
established on 31 May in Szechwan, which has been
one of the most troubled areas of China.
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Europe
CRISIS IN FRANCE CONTINUES
Tensions have relaxed somewhat with De Gaulle's
announcement of new elections but his call for a
massive "back to work" movement has not been fully
heeded and militants are trying to prolong the
crisis.
CZECHOSLOVAK LEADERS MAINTAIN ACTIVE POLITICAL PACE
Dubcek and other party leaders traveled to several
major cities this week to brief the rank and file
on the central committee plenum and to seek support
for the extraordinary party congress scheduled for
September.
YUGOSLAVIA AND RUMANIA CEMENT RELATIONS
During his recent visit to Yugoslavia, Rumania's
Nicolae Ceausescu found Tito's views similar to his
own.
USSR STUDIES SUBMARINE ENVIRONMENT IN THE ATLANTIC 14
A group of Soviet ships conducted acoustic research
and submarine-related tests west of the Canary Is-
lands during the latter half of May, but dispersed
when US ships and aircraft began to search the area
for the missing Scorpion.
YUGOSLAVIA'S MOUNTING TRADE PROBLEMS WITH THE EEC 16
Ever since tight restrictions on imports from West-
ern Europe were partially removed early last year,
Yugoslav trade with the Common Market has been run-
ning at a large deficit, and Belgrade may have to
reimpose controls.
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Middle East - Africa
THE WEEK IN PERSPECTIVE
NIGERIAN PEACE TALKS BREAK OFF
With the breakdown of the negotiations last week, a
peaceful end to the civil war seems remote. At pres-
ent, the heaviest fighting continues in the Port Har-
court area as the Biafrans strike back stubbornly.
SENEGAL SHAKEN BY STUDENT AND LABOR AGITATION
Although calm has returned to Dakar after a week of
strikes and agitation, serious problems remain. The
Senghor regime, having lost prestige and self-confi-
dence, may be less able to cope with future chal-
lenges.
AFRICAN RAIL PROJECTS PUSHED BY COMMUNIST CHINA
The Chinese are moving ahead with plans to construct
a 1,000-mile rail link between Zambia and Tanzania,
and have signed an agreement to help build a 200-
mile railroad between Mali and Guinea.
ANTI-US CAMPAIGN GAINING IN SIERRA LEONE
An anti-Western and especially anti-US campaign is
being whipped up by radicals around Prime Minister
Siaka Stevens in an effort to convince him that ele-
ments in the West have been conspiring with indi-
genous plotters to overthrow his new regime.
NEW BORDER FLARE-UP MARKS ARAB-ISRAELI WAR ANNIVERSARY
A major fight along the northern Jordanian-Israeli
border took place on the day before, but the anni-
versary date itself passed relatively quietly in the
Arab world.
Western Hemisphere
PANAMANIAN GOVERNMENT TRYING TO INVALIDATE ARIAS VICTORY
To squelch the government's efforts to disqualify
Arias' election by "legal" means, backers of presi-
dent-elect Arnulfo Arias reportedly are using threats
of impeachment action against President Robles and
judges on the Supreme Court.
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PROSPECTS FOR ECUADOR UNDER VELASCO SEEM UNCERTAIN
Although Jose Maria Velasco's presidential victory
seems secure, his chances of finishing his term are
cast in doubt by the present opposition to him as
well as his past history of being ousted.
PERU'S NEW CABINET FACES OLD PROBLEMS
President Belaunde's cabinet changes last week may
be an attempt to deal with Peru's economic problems
by altering form rather than substance.
CHILEAN STUDENTS DEMAND UNIVERSITY REFORM
Students have occupied most buildings at the Univer-
sity of Chile and brought a halt to normal teaching
and research functions to enforce their demands for
a voice in choosing university authorities.
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The arrival of ranking politburo member Le Due Tho had no im-
mediate effect on the official position taken by the North Vietnamese
delegation in Paris. Hanoi spokesmen are attempting in private, however,
to create the impression that the talks will move forward and some
concessions might be made if only the US would halt the bombing.
Saigon was the main arena for fighting in Vietnam this week, and
there is abundant indication that the Communists intend to sustain their
campaign of harassment in and around the city for a prolonged period.
Although this new campaign has not been as large scale as the Tet attacks,
civilian casualties, destruction of buildings, and the number of refugees
may well have surpassed the Tet levels.
In Peking, the latest turn of the kaleidoscope suggests that the
regime's top economist, a subordinate of Chou En-lai, has been down-
graded. Another Chou associate, who coordinates the advanced weapons
program, has also come under renewed attack. The regime has finally
pieced together a Revolutionary Committee to govern troubled Szechwan
Province. The new committee may reduce, but probably will not end, the
factional fighting there.
South Korean President Pak is confronted with an unprecedented
break in the unity of his regime. The sudden resignation last week of
government party chairman Kim Chong-pil, for years one of Pak's closest
associates, was stimulated by a number of factors, most notably the
conflict between Kim's presidential ambitions and Pak's apparent inten-
tion to have the constitution amended so that he can run for a third term
in 1971. Although Pak has accepted Kim's resignation, the President may
find it politic to leave the door open for an eventual reconciliation. Kim
still has a substantial following in the party and in the National Assembly.
Australian Prime Minister Gorton appears to have changed his mind
and now believes that Australia should maintain a military contingent in
Malaysia and Singapore after the British withdrawal in 1971. Prior to his
visit to the US last week, Gorton had been inclining toward a "Fortress
Australia" concept, partly out of fear of possible American retrenchment 25X1
in Asia. The precise form of the Australian post-1971 presence may
become clearer after the five-nation Commonwealth conference scheduled
to begin in Kuala Lumpur on 10 June.
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THUA 5H(F.N ..
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-NH I LUNG
LUNG
LONG
KHANH
BINH
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SOUTH VIETNAM
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VIETNAM
Hanoi has significantly
strengthened the North Vietnamese
delegation in Paris with the ar-
rival of ranking politburo member
Le Duc Tho and several special-
ists, including a legal expert
and a propaganda specialist on
American affairs. Tho, at least
initially, will serve Xuan Thuy
as a "special adviser," a some-
what anomalous position in view
of Tho's considerably higher rank
in the North Vietnamese Communist
Party hierarchy.
other acts of war." In private,
however, the North Vietnamese have
been trying to create the impres-
sion that there would be movement
and some concessions if only the
US agreed to a bombing stop. Al-
though the official record is by
no means clear, Hanoi also seems
to be hinting that an interim
period might be possible between
an agreement to halt the bombing
and its actual implementation in
which the talks could move on to
substantive matters.
Although no clear-cut reason
is apparent for the dispatch of
Tho to the talks, it seems probable
that his presence is designed to
give the North Vietnamese dele-
gation somewhat greater authority
in any on-the-spot decisions that
might be necessary in the course
of the Paris talks. Tho is one
of the most influential politburo
members in the Hanoi hierarchy,
is considered a leading party
theoretician, and has been in-
timately associated with Viet-
namese Communist efforts in South
Vietnam for over 20 years. It
is also possible that Hanoi in-
tends Tho to lead the delegation
during any substantive phase of
the talks and wanted to see him
established and circulating in
Paris well in advance.
Meanwhile, the deadlock in
the Paris talks continued, with
the North Vietnamese still hold-
ing officially to the line that
no progress could be expected
until the US "determines" the
cessation of bombing and "all
Vice Premier Reports on
North Vietnamese Economy
Vice Premier Nguyen Con's
economic report to the North Viet-
namese National Assembly last week
dwelt on many problems that have
become chronic in the war economy.
Among the problem areas he cited
were labor utilization, funds and
materials management, market and
price control, and the equitable
distribution of goods. Although
most of these difficulties are
endemic to the economy, they have
been aggravated by the bombing.
Con's speech was devoid of spe-
cific prescriptions for dealing
with North Vietnam's economic
problems, but his claim that the
basic needs of the people are be-
ing met appears justified.
The food problem, for in-
stance, remains manageable. Crops
are still below prebombing aver-
ages, but the Soviet Union and
China are continuing to provide
whatever is necessary to-supple-
ment domestic production. Sea
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deliveries of food during the
first five months of this year
totaled about 285,000 tons, up
more than 40 percent over last
year's total for the same period
and accounting for almost 35 per-
cent of total shipments to Hai-
phong.
The War in South Vietnam
Fighting during the week
centered on the Saigon area as
the enemy continued its campaign
of harassment in and around the
city. In addition to subjecting
Saigon to the heaviest rocket
barrage of the war, the Communists
infiltrated ground units into
parts of Cholon and Gia Dinh,
forcing allied forces to under-
take difficult house-to-house
fighting.
These engagements, coupled
with supporting air strikes, have
resulted in significant new de-
struction of buildings and houses
as well as new civilian casual-
ties, and have added to the gov-
ernment's already heavy burden of
refugees. An errant and defec-
tive US rocket blew up the police
command post in Cholon, wounding
Saigon's mayor and killing or
wounding virtually the entire
top command of the national po-
lice force.
Even though the Saigon popu-
lace thus far seems to be accom-
modating itself stoically to this
Communist campaign and tends to
blame the Communists for its
hardships, captured documents
and prisoner interrogations sug-
gest the enemy intends to keep up
these tactics indefinitely. To
sustain the campaign, the Commu-
nists apparently plan to rotate
units, bringing in fresh troops
from other parts of III and IV
corps. Among the units identified
by prisoners in the recent fight-
ing have been elements of three
Viet Cong main force battalions
from IV Corps.
Enemy ground activity slack-
ened in I Corps, perhaps partly
because of Communist preoccupation
with food procurement. In Thua
Thien Province, for example, prison-
ers from two main force battalions
have stated that their battalion's
mission was to provide security for
rice-harvesting operations. In
recent operations, allied forces
uncovered some 60,000 pounds of
rice near Phu Bai and another
12,000 pounds just south of Da
Nang. South Vietnamese troops on
3 June captured three North Viet-
namese near Phu Bai who said others
would surrender if given the chance.
Subsequently, loudspeaker aircraft
were sent to the scene, and an-
other 50 troops and sympathizers
surrendered.
Political Developments in Saigon
Saigon political activity
was in low key during the week
as Prime Minister Huong divided
his time between trying to set
his new government in motion and
soothing bruised feelings through
a series of calls on such figures
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as the leaders of both houses of
the assembly and hospitalized
General Loan. Huong indicated
he had no immediate intention
of replacing Loan as security
chief.
The new premier's first cabi-
net meeting on 30 May was reported
to have been largely a pro forma
affair, with Huong stressing a
short-term action program, a stream-
lining of the government, intensi-
fied anticorruption and informa-
tion programs, and an abolition of
press censorship.
There are indications that a
major role is envisaged for General
Khiem as interior minister. He re-
portedly will be given substantial
powers over nonmilitary governmental
activities in the provinces. Inas-
much as most provincial governors
are military men, interior ministers
in South Vietnam have traditionally
found it difficult to assert their
administrative authority at the pro-
vincial level. To the extent that
Khiem attempts to establish his sway,
he may soon find himself embroiled
with a military establishment already
suspicious of President Thieu's in-
tentions in recalling Khiem from the
ambassadorship in Taipei.
Thieu has returned the general
mobilization bill to the National As-
sembly with a request for amendments
to extend the upper and lower age
limits for draftees, eliminate all
exemptions for veterans, and increase
deferments among police and Revolu-
tionary Development cadres. The re-
strictions in the present bill were
drafted in the Lower House and passed
by a two-thirds majority. An Upper
House version would have allowed the
government wide discretionary power.
Should the Lower House stick to its
guns, it could easily defeat Thieu's
amendments, which require approval
by an absolute majority of both houses
meeting jointly.
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FIGHTING EASES IN LAOS
The fighting continues to
taper off as Communist forces
move to a defensive posture.
In the north, the enemy
threat to the vital government
guerrilla base at Na Khang con-
tinues to subside. Villagers re-
port that the enemy sustained a
substantial number of casualties
from heavy air strikes in the
area and was forced to withdraw
from the immediate area. Govern-
ment forces are now planning to
attempt to regain positions north
of the base lost last month.
Activity in the Plaine des
Jarres and Paksane areas has been
light. Government forces have en-
countered only small enemy pa-
trols. Although intensive air
strikes may have discouraged an
enemy build-up in the Paksane
area, it is possible that an al-
leged Communist "threat" in the
area was exaggerated by the re-
gional military commander, Gen-
eral Kouprasith.
In the south, government
forces also moved back into Ban
Houei Mun and Muong Phalane,
which were lost earlier this year.
Although there was little or no
Communist resistance, the enemy
subsequently retook Muong Phalane.
In the Bolovens Plateau area,
government forces reoccupied an
outpost some nine miles east of
Khong Sedone that had been over-
run two weeks ago.
Although early rains have
not yet become an important mili-
tary factor, the lessening of
Communist activity over the past
several weeks suggests the enemy
is already digging in for the ex-
pected government wet-season coun-
teroffensive. There have been no
indications so far that North Viet-
namese troops are being withdrawn
from Laos, as they have in past
SOUTH
VIETNAM rainy seasons. The enemy will
? Government-held
location
5 MILES
75 KILOMETERS
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probably allow the government to
retake several minor positions,
but they will probably resist ef-
forts to drive them from important
areas, such as the Se Done Valley,
which they occupied with consider-
able loss of men and material.
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SOUTH KOREAN REGIME TORN BY INFIGHTING
The sudden resignation last
week of government party chair-
man Kim Chong-pil represents an
unprecedented break with Presi-
dent Pak Chong-hui's leadership
and confronts Pak with the pros-
pect of a dissident faction loyal
to Kim.
Kim is reported to have said
that he resigned because Pak
continually ignored his recom-
mendations for ministerial ap-
pointments and because he be-
lieved the President had decided
to amend the constitution so that
he could seek a third term in
1971. Kim is ambitious to suc-
ceed Pak and had generally been
regarded in Korean political
circles as Pak's heir apparent.
The timing of the resignation
suggests it was triggered when
Pak recently expelled one of Kim's
leading followers from the party
for attempting to organize sup-
port for Kim's candidacy.
Kim's action may be calcu-
lated to regain political influ-
ence he had gradually lost to op-
ponents within the regime. These
men owe their positions to Pak
and are thus anxious to remove
the constitutional bar to a third
term for the President.
Pak is reported to have been
surprised by Kim's action and ap-
parently attempted to dissuade
him. On 4 June, Pak called for
party unity and appointed as Kim's
successor a long-time party stal-
wart not aligned with any of the
factional groups. With Kim's
withdrawal--at least temporarily--
from national leadership, Pak may
make further personnel changes in
an effort to redress the factional
imbalance in the regime. In view
of Kim's substantial following
in the party and the National As-
sembly, Pak may find it politic
to leave the door open for an
eventual reconciliation. I
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COMMUNIST CHINA'S LEADERSHIP STILL IN FLUX
Shifts in the relative posi-
tions of officials attending a
major reception on 3 June in Pe-
king indicate that the leadership
is still in a state of flux. In
the provinces, a revolutionary
committee was finally established
on 31 May in Szechwan, which has
been one of the most troubled
areas of China.
Peking
The most significant change
disclosed by a listing of offi-
cials at a reception in Peking
on 3 June was the downgrading of
Li Fu-chun, the regime's top
economist, a subordinate of Chou
En-lai, and until now a member
of the elite group around Mao
Tse-tung. Li was not listed in
his usual spot among standing
committee members, but was in-
cluded among ordinary politburo
members.
In another development,
Nieh Jung-chen, chairman of the
National Defense Scientific and
Technological Commission, is
again being criticized in wall
posters. Nieh, who is in charge
of coordinating the advanced
weapons program, nevertheless
continues to appear publicly in
his usual place among politburo
members.
The order in which military
figures have been listed in the
four major turnouts since March
records several shifts but, in
general, military leaders now ap-
pear to have gained a stronger
political position. Military men
also continue to dominate the "rev-
olutionary" governments being
formed in the provinces. Repre-
sentatives, mainly military offi-
cers, from all five provinces not
yet "revolutionized" attended the
reception on 3 June. The publicity
accorded these men suggests they
have been selected to head the new
governments scheduled for their
provinces.
The establishment of a pro-
vincial revolutionary committee on
31 May in Szechwan may reduce, but
probably will not end, the factional
fighting. Appointment of the Szech-
wan committee came after months of
political pulling and hauling in
Peking. The membership follows
the approved Maoist formula for a
"three-way alliance" among repre-
sentatives of the army, the cadres,
and "revolutionary" organizations.
The inclusion of members of opposing
factions probably will ensure that
political friction will continue.
The chairman is Chang Kuo-hua,
the ranking military man in south-
west China and the choice of "con-
servative" political forces in
Szechwan. The more important of
the 15 vice chairmen are Li Ta-
chang, former governor and party
secretary; Cheng-tu Military Re-
gion commander Liang Hsing-chu, who
has been aligned with "conservative"
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Status of Provincial Level Governments, 3 June 1968
0 Revolutionary Committee
Preparatory Group for Revolutionary
Committee
^ Military Control Committee
(M) Committee with Military Chairman
(C) Committee with Civilian Chairman
REVOLUTIONARY
DATE OF
REVOLUTIONARY
DATE OF
COMMITTEE
FORMATION
COMMITTEE
FORMATION
Heilungkiang (C)
31 Jan. 1967
Hopeh (C)
3 Feb. 1968
Shanghai (C)
5 Feb. 1967
Hupeh (M)
5 Feb. 1968
Kweichow (M)
14 Feb. 1967
Kwongtung (M)
21 Feb. 1968
Shantung (C)
23 Feb. 1967
Kirin (M)
6 March 1968
Shansi (C)
18 March 1967
Kiangsu (M)
23 March 1968
Peking (C)
20 April 1967
Chekiang (M)
24 March 1968
Tsinghai (M)
12 Aug. 1967
Hunan (M)
9 April 1968
Inner Mongolia (M)
1 Nov. 1967
Ningsia (M)
10 April 1968
Tientsin (C)
6 Dec. 1967
Anhwei (M)
18 April 1968
Kiongsi (M)
5 Jon. 1968
Shensi (C)
1 May 1968
Kansu (M)
24 Jon. 1968
Liaoning (M)
10 May 1968
Honan (C)
27 Jan. 1968
Szechwan (M)
31 May 1968
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forces; two notorious radical
figures, Liu Chieh-ting and his
wife, who are advocates of a
thorough-going purge; and Tien
Pao, a Tibetan national also known
as Sang-chi-yueh-hsi.
Li Ta-chang went into politi-
cal limbo after being paraded in
disgrace by Red Guards in January
1967. A Cheng-tu broadcast of
a "self-criticism" by Li Ta-chang
last August and Red Guard material
in March 1968 indicated that he
was being "rehabilitated." This
material did not suggest, how-
ever, that he would end up as
number two on the revolutionary
committee.
In his inaugural speech,
Chang Kuo-hua emphasized that
the existence of the revolution-
ary committee did not mean the
"end of class struggle but a
starting point for new battles."
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In France, the tensions eased somewhat with De Gaulle's counterat-
tack and the focus shifted to the electoral struggle ahead. The "back to
work" movement, however, was not as massive as the government had
hoped and militants are trying to prolong the crisis.
The Italian Government resigned on 5 June as Parliament met in its
first session since the elections of 19-20 May. The Christian Democrats
and the small Republican Party will probably form a minority government
with parliamentary support from the Unified Socialists, at least until that
party's congress next October.
In Yugoslavia, long considered the most progressive Communist
country, student riots broke out in several cities. The regime initially was
of a mind to grant what concessions it could to the students, but clearly
will take a harder line if they refuse to be mollified. The regime has
summarized its position as, "Demands, yes; disorders, no."
The Czechoslovak leadership continued an active political pace in
local and foreign affairs. Dubcek's supporters fanned out from Prague to
tell the locals about the just-concluded party plenum and to set the stage
for an extraordinary party congress in early September. Simultaneously,
the very progressive president of the Czechoslovak National Assembly
went to Moscow leading a parliamentary delegation for a lengthy visit.
This appears to be part of Prague's efforts to keep a dialogue going with
the Russian leadership.
Dubcek and others in their statements concerning foreign policy
continued to offer Moscow assurances of loyalty to the Soviet alliance.
Nevertheless, Soviet troops remain in place along Czechoslovakia's borders,
and Warsaw Pact exercises will be held in Czechoslovakia this month in
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CRISIS IN FRANCE CONTINUES
After remaining aloof to the
first phase of the student-labor
crisis, De Gaulle vigorously
counterattacked last week. In a
broadcast on 30 May, he "post-
poned" the referendum he had pro-
posed earlier and called for new
parliamentary elections. He
coupled this with a show of mil-
itary force and a reorganization
of the cabinet. These initiatives
appear to have relaxed tension
and to have shifted attention
from protest demonstrations to
the electoral struggle. The gov-
ernment's call for a massive
"back to work" movement was not
fully heeded, however, and mili-
tant opponents of the government
are trying to prolong the crisis.
The new government, officially
constituted on 1 June, bears the
personal imprint of Premier Pom-
pidou. Two of his closest asso-
ciates were moved to key positions,
and a number of persons whose
main allegiance was to the Presi-
dent rather than the premier were
dropped. Heir-apparent Pompidou
thus appears to have acted with
a new assertiveness.
The electoral campaign opens
on 10 June with voting on the
23rd and again on the 30th in
those constituencies where no
candidate gets a majority on the
first round. The major parties,
with few exceptions, will present
their former assembly deputies
for re-election, but campaign
issues will be sharpened by events
of the past month. The Gaullists
will combine promises of social
"renovation" and "participation"
with warnings about "totalitarian
Communism" and "dictatorship"--
themes De Gaulle emphasized in
his speech of 30 May. The left
will charge that the Gaullists
have ignored basic problems for a
decade and are not capable of exe-
cuting required reforms.
Only one innovation in elec-
toral tactics has emerged. The
Gaullist-allied Independent Repub-
licans have decided to run their
own candidates on the first ballot
in constituencies held by the left.
In 1967 this party made an agree-
ment with the Union of Democrats
for the Fifth Republic, the ortho-
dox Gaullist party, to present a
single candidate on the first bal-
lot to represent Gaullist forces.
Hopes for channeling the pro-
test from the streets to the bal-
lot box may yet be endangered by
militants. Even if workers in
key industries and public services,
encouraged by agreements that go
beyond the provisions of the re-
jected protocole d'accord of
27 May, return to work shortly,
holdouts in certain sectors could
continue to harass the government.
Moreover, tensions appear to
be increasing on the student front.
Moderate elements are being out-
maneuvered by radicals, an in-
creasing number of whom now demand
a revolutionary renovation of so-
ciety.
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CZECHOSLOVAK LEADERS MAINTAIN ACTIVE POLITICAL PACE
Party leaders this week
briefed the rank and file on the
results of the central committee
plenum and sought support in pre-
paring for the extraordinary party
congress scheduled for September.
Party first secretary Dub-
cek's speech in Brno on 3 June
presumably served as a model for
the other party leaders. Dubcek's
major theme was that the party
must continue its revival process"
by implementing the action pro-
gram. He implied that the cen-
tral committee must be revamped
in order to accomplish this.
As in his speech at the plenum
on 29 May, Dubcek scored the ac-
tivities of "extremist elements"
outside the party, but he ap-
parently devoted more time in Brno
to attacking party "secretarians."
For the first time, he publicly
lashed out at Novotny and the Tat-
ter's supporters, explaining that
it was necessary to move up the
date of the congress because these
men would not voluntarily resign.
Dubcek said the party cannot
stop "halfway," but must mobilize
to create a "socialist democracy."
He again appealed for popular sup-
port, stressing that the working
class is the "principal force" in
the country and holding out the
possibility that workers will be
given a greater voice in the ad-
ministration of enterprises.
In discussing foreign policy
on 29 May, Dubcek reaffirmed that
Prague will maintain its alliance
and "good relations" with the USSR
and other friendly socialist coun-
tries while it pursues an "active
and flexible" policy toward all
other countries. His remarks on
West Germany, however, were more
negative than those made recently
by some Foreign Ministry officials.
He noted that there are differences
between Czechoslovakia and its al-
lies, but suggested that Prague's
policy will be based on his unique
negative version of the "Golden
Rule."
Moscow may be somewhat re-
assured by the moderate tone Dub-
cek and other leaders have taken
during and after the central com-
mittee meeting, but it cannot be
happy about the scheduling of the
special party congress. Nevertheless,
the Soviets, apparently as one re-
sult of Kosygin's trip to Czechoslo-
vakia, are maintaining the truce in
the "press war." Instead of polemi-
cal attacks, the Soviet press, as it
did before April, is relying on
heavy-handed editing of news reports
from Czechoslovakia to express Mos-
cow's views on developments there.
Moscow also has been giving broad
and favorable coverage to the ac-
tivities of visiting Czechoslovak
delegations.
The Soviet forces that moved
into positions near the Czechoslo-
vak border in early May remain in
place. Some Soviet signal units
have entered Czechoslovakia in prep-
aration for the Warsaw Pact command-
staff exercise to be held later this
month. 25X1
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YUGOSLAVIA AND RUMANIA CEMENT RELATIONS
Rumania's Nicolae Ceauses-
cu's visit to Yugoslavia from 27
May to 1 June led to the two
countries drawing together more
closely, in part as the result
of Moscow-directed pressures on
Czechoslovakia. The two leaders
hold similar opinions on most
matters, and the final communi-
que pointed the way to expanded
economic cooperation.
Throughout the visit, Tito
and Ceausescu were careful to
avoid any statements that would
have complicated the position of
the reformist Czechoslovak re-
gime. The communique implicitly
supported Prague's independent
stance, however, heavily empha-
sizing the right of each Commu-
nist party to determine its own
road to socialism without out-
side interference.
Ceausescu and Tito gave no
hint that they had softened their
opposition to the world Commu-
nist conference scheduled for
next November in Moscow. The
two accommodated their once-
divergent views on the Middle
East--differences that had ac-
counted for the postponement of
Ceausescu's visit to Yugoslavia
last June--and called for the
withdrawal of Israeli forces
from all occupied areas.
Tito apparently did not is-
sue a direct invitation to the
Rumanians to attend the "non-
aligned" conference he is plan-
ning for next year, but he did
for the first time elicit Ceauses-
cu's interests in the scheme. The
communique called for wider co-
operation among all "progressive"
movements, including non-Communist
groups, in opposing "imperialism."
It also called for further efforts
to promote European detente by
the Group of Ten, an informal
organization of the smaller Euro-
pean states to which both Rumania
and Yugoslavia belong.
USSR STUDIES SUBMARINE ENVIRONMENT IN THE ATLANTIC
Soviet ships and submarines
have again conducted special oper-
ations in distant Atlantic waters.
Two hydroacoustic research
ships--Petr Lebedev and Sergey
Vavilov--arrived off the Canary
Islands on 11 May, followed by
a nuclear-powered E-II - class
cruise-missile submarine and a
submarine rescue vessel. The
same two research ships have con-
ducted hydroacoustic surveys in
the area between the Cape Verde
Islands and the Azores almost
every year since 1963. Experts
in hydroacoustics and noise con-
trol on submarines are aboard
both ships. The Soviets were
probably studying submarine noise
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levels and sound-wave propagation
in the waters, where favorable
sonar listening conditions exist.
A group of Soviet submarines
and submarine-support ships spent
six months off Cape Verde and
French Guiana last summer in an
evaluation of extended submarine
deployments to distant waters.
Moscow may intend to operate nu-
Hydroacoustic Ship
VAVILOV with Balloon
clear submarines from a mobile
support base in the mid-Atlantic,
where the submarines would be dif-
ficult to locate and in a good
position to make an end run on
the US through the Caribbean.
The Soviet units dispersed
last weekend when US ships and
aircraft began to search the Canary
Basin for the missing submarine,
Scorpion.
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YUGOSLAVIA'S MOUNTING TRADE PROBLEMS WITH THE EEC
Ever since tight restrictions
on imports from Western Europe
were partially removed early last
year, Yugoslavia's trade with
members of the European Economic
Community (EEC) has been running
at a large deficit, and Belgrade
may have to reimpose controls.
The pent-up demand for West-
ern goods caused an upsurge of
imports last year that resulted
in the EEC displacing CEMA as
Yugoslavia's principal collective
trading partner. Italy edged the
USSR as Yugoslavia's leading trade
partner, and West Germany drew
close to the USSR.
During this period, exports
to the EEC have been declining.
Intensified EEC restrictions on
Yugoslavia's agricultural exports,
particularly meat, as well as dif-
ficulties in selling its indus-
trial goods, which tend to be of
poor quality, have thwarted Yugo-
slav efforts to increase exports.
A recent EEC proposal to
classify Yugoslavia as a "state
trading country" in order to ap-
ply additional import restrictions
has provoked bitter reactions in
Belgrade. The measure would af-
fect most of Yugoslavia's agri-
cultural exports, which last year
comprised about half of its total
exports to the EEC.
Yugoslav concern has been
heightened by problems in financ-
ing last year's deficit of $454
million with the Common Market
countries. The deficit has been
growing so far this year. With
only limited hard-currency re-
serves and no large hard-currency
credits in sight, Belgrade prob-
ably will have to add to the list
of restrictions it reimposed on
imports last November.
Belgrade will continue to
seek hard-currency credits and
may sound out the West Germans
when Foreign Minister Brand
in Yugoslavia next week.
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MIDDLE EAST - AFRICA
The first anniversary of the Arab-Israeli war passed rather quietly in
the Arab world, but a major border flare-up between Israel and Jordan
took place on 4 June, the day before the anniversary. Support for the
terrorists is still strong in the Arab world and further clashes are inevi-
table.
The Shah of Iran and Saudi King Faysal had a cordial exchange of
views on 3 June. Their talks focused mainly on Persian Gulf problems, and
the two agreed on the need for Iranian-Saudi cooperation in the gulf-
particularly in view of the British withdrawal from the area.
Representatives of the Greek and Turkish communities on Cyprus
will begin "full talks" in Nicosia on 24 June. The representatives held
preliminary discussions in Beirut this week after weeks of haggling over
the site. The meeting marked the first open contact between the two sides
since December 1963. The basic problems dividing them are so formidable,
however, that the talks will probably not be very productive.
In Turkey, the incumbent Justice Party ran well ahead of all other
parties in the senatorial and local elections on 2 June, a further indication
that the party will retain power in next year's general elections.
The Nigerian peace talks broke down this week, and the prospects for
a negotiated ending of the civil war seem ever more remote. Elsewhere in
Africa, President Senghor of Senegal survived a week of strikes and
student agitation, but at the cost of losing prestige and confidence for his
regime.
In Sierra Leone, militant youths trained in Communist countries are
spearheading a virulent anti-US campaign to convince Prime Minister
Stevens that elements in the West are conspiring to overthrow his regime.
Zambian President Kaunda, concerned that liberation fighters oper-
ating out of Zambia will eventually provoke retaliation by the white-
controlled southern African regimes, is actively seeking defensive arms.
He wou like Western as-
sistance for his defe e n ee ut says he will turn to the Communist
countries if necessary.
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NIGERIAN PEACE TALKS BREAK OFF
With the breakdown last week
of the peace negotiations in Kam-
pala, Uganda, an end to the civil
war seems remote. At present,
the heaviest fighting continues
in the Port Harcourt area as the
Biafrans strike back stubbornly.
The Biafrans pulled out of
the Kampala talks on 31 May,
nitshc\
6
90820 6-68 L
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of )'Aba
Port Harcout,~?
R I V E R S
EAST State boundary and name
Q Airfield
0 25 50 75
claiming the federal negotiators
were stalling and were not se-
riously interested in halting the
war. Unable to get Lagos to
agree to an immediate cease-fire,
the Biafrans refused to yield to
the federal demand that they re-
nounce secession and accept their
place in Nigeria's 12-state
structure.
m powerplan
FERNANDO PO
(Sp.)
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The failure of the cease-fire
talks may prompt additional rec-
ognition of Biafra by African
states that consider Lagos' posi-
tion too unyielding. Senegalese
recognition could come at any
time because President Senghor
reportedly has already been em-
powered to recognize Biafra. He
was awaiting the outcome of the
peace talks before acting. Congo
(Brazzaville) may also recognize.
Tanzania, which accorded Biafra
its first recognition in April,
is now strongly urging that
"Biafra must be helped."
The heads of the Entente
states of West Africa--Ivory Coast,
Niger, Upper Volta, Togo, and
Dahomey--agreed at a meeting in
Togo last week to use their in-
fluence with each side to help
bring about an end to the hostili-
ties. President Diori of Niger,
a strong supporter of the Lagos
government, may try to arrange a
meeting with federal leader Gowon
to urge him to soften federal in-
sistence on the 12-state concept.
Ivorian leader Houphouet-Boigny,
who has already recognized Biafra,
is expected to contact the seces-
sionists.
Maj. Gen. Gowon, whose mili-
tary forces have not slackened
their effort during the peace
talks, has now publicly told the
Ibos to accept federal terms or
be "pushed to the wall." His
basic strategy is to occupy Rivers
State and complete the isolation
of the Ibos in the East-Central
State. The military situation
in the Port Harcourt area, however,
is somewhat confused. The Bia-
frans have managed to land troops
in the harbor area and are firing
homemade rockets at federal planes
using the airfield. Biafran
troops have also recaptured the
Afam powerplant southeast of
the city. Lagos probably will
manage to find enough reinforce-
ments of men and munitions to
assist its hard-pressed 3rd
Division. The federal air force
has been of little help because
of the rains now in progress.
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SENEGAL SHAKEN BY STUDENT AND LABOR AGITATION
Calm has returned to Senegal
after a week of student and labor
strikes, but the problems under-
lying public discontent remain.
The Senghor government--its con-
fidence shaken by the crisis in
France, with which it has close
ties, as well as by events in
Senegal--has suffered a loss of
prestige and may find it more
difficult to cope with future
challenges.
The strikes that broke out
on 27 May at the French-adminis-
tered University of Dakar--tra-
ditionally a hotbed of radical-
ism--and spread to several lycees
were the culmination of a leftist-
sponsored campaign against recent
changes in government scholarship
policy. That they were sympto-
matic of more deep-seated griev-
ances and were actually an indict-
ment of the whole French-struc-
tured education system became evi-
dent in the refusal of the stu-
dents to negotiate with the govern-
ment on the scholarship issue.
Labor leaders, who had broken
their shaky alliance with the
government to voice their own de-
mands on May Day, were initially
reluctant to join in the agita-
tion. After the dispatch of po-
lice to the campus on 29 May,
however, the major national union
called for a general strike on
31 May to protest the government's
use of force and to support stu-
dent demands. President Senghor
responded with a radio appeal for
support and proclaimed a state
of national emergency. He blamed
the troubles on "outside forces,"
citing the "Maoist" orientation
of his opposition.
Although the strike was never
fully effective, intervention by
Senegalese troops was required
to quell the accompanying loot-
ing and rioting. Locally based
French troops were deployed to
guard strategic facilities in the
capital. Senghor was also bol-
stered when party militants were
rushed into Dakar by the conserv-
ative Muslim brotherhoods that
underpin the regime.
By evening of 31 May, order
had been restored in Dakar. Many
labor leaders, including several
on the national level, had been
arrested for fomenting the strike
and allegedly plotting a coup.
When strikers began drifting
back to work over the weekend,
the government responded with
conciliatory gestures. It de-
clared that the cabinet would
consider union demands on 5 June
and that a meeting of government,
union, and employer representa-
tives would be held on 12 June.
On 4 June, the government an-
nounced it had agreed to release
the jailed union leaders in re-
turn for their formal termination
of the strike.
Economic difficulties will
add to Senghor's problems in
dealing with the growing dissat-
isfaction. The budget has already
been strained by a decline in
revenues from Senegal's major ex-
port, peanuts, and prospects are
dim for a revival of the stag-
nant economy.
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AFRICAN RAIL PROJECTS PUSHED BY COMMUNIST CHINA
The Chinese are moving ahead
with plans to construct a 1,000-
mile rail link between Zambia
and Tanzania, and have signed an
agreement to help build a 200-
mile railroad between Mali and
Guinea. These developments re-
flect an increased effort by Pe-
king to enlarge Chinese influence
state since Mauritania's President
Daddah went to Peking last Oc-
tober.
The agreement for the Tan-
Zam project was signed last Sep-
tember and the protocols in April
1968. Some 340 technicians ar-
rived in Dar es Salaam in April
to begin a detailed engineering
survey of the Tanzanian segment.
This evidence of Chinese willing-
ness to proceed with the project
may already have borne political
fruit.
Bamako
GUINEA:
Conakry
in Africa and are probably part
of a larger plan aimed at pro-
jecting an image of normality
in foreign relations to offset
the costly excesses of "Red Guard
diplomacy" last year.
The foreign ministers of
Guinea and Mali received red
carpet treatment in Peking prior
to the signing of the tripartite
agreement on the construction of
the Guinea-Mali link on 24 May.
The highlight of their visit was
a meeting with Mao and Lin Piao,
the first time the Chinese lead-
ers had hosted a nonbloc mission
in seven months. President Julius
Nyerere of Tanzania is due in
Peking later this month, the
first visit to China by a head of
Dar es Salaam has taken a
strong stand against the nonpro-
liferation treaty, adamantly op-
posed by Peking, and led an abortive
move at the UN to postpone further
consideration of the measure until
the next regular session of the
General Assembly. A Tanzanian
Foreign ministry official said that
one reason for his government's
position was a desire to avoid an-
tagonizing Peking and possibly
jeopardizing Chinese aid.
The exact cost of constructing
these railroads is not known, but
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the burden on the Africans will be
minimal. The Tan-Zam link is to
be financed under an interest-free
loan that may be repaid, at least
partially, in African commodities.
Details on the Mali-Guinea railway
agreement are lacking, but the fi-
nancing will probably follow the
pattern set by the Tan-Zam agree-
ments.
These railroad projects high-
light Peking's long-standing com-
mitments to three of the states in-
volved. Guinea has been receiving
a wide range of economic assistance
from China since 1959. Mali began
receiving economic aid in 1961 and
now has the largest Chinese aid
mission in Africa, with some 1,400
technicians operating throughout the
country. China's assistance to
Tanzania began in 1964 and has re-
mained at a high level. Peking's
first credits to Zambia were ex-
tended in 1967 for the construction
of the Lusaka-Mongu highway.
ANTI-US CAMPAIGN GAINING IN SIERRA LEONE
An anti-Western and especially
anti-US campaign is being whipped
up by radicals around Prime Minis-
ter Siaka Stevens in an effort to
convince him that elements in the
West are conspiring to overthrow
his new regime. The political
situation is complicated by a
deterioration in security condi-
tions as a result of mounting
tensions between Sierra Leone's
two major tribes, the northern
Temne and the southern Mende.
Leftist militants in Stevens'
government and in his northern-
based party, dominated by the
Temne, are circulating a story
that US, UK, and expatriate busi-
ness firms have been involved in
an antigovernment plot with dis-
affected indigenous elements.
These militants, many of whom are
young people trained in Communist
countries, may also have insti-
gated the breakup by soldiers of
a Peace Corps conference in
Freetown on 1 June.
Several other anti-US inci-
dents have occurred, mainly in-
volving minor harassment of US
citizens, and anti-American
editorials have appeared in Free-
town's press. Stevens gave a
less than satisfactory response
when the US ambassador informally
protested these incidents. A
youth leader in Stevens' party
claims that demonstrations are
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planned against the US and UK
embassies.
Meanwhile, security condi-
tions in the north have deterio-
rated. Supporters of Stevens
have been inciting crowds and
hoodlums against local chieftains
who supported the former Mende-
dominated government. Extra
police units have been dispatched
to deal with the violence, but
the disorganized police force will
be hard pressed to control spread-
ing disorders.
Stevens' grip on the reins
of power remains very tenuous.
His control over the army and
police is marginal, and his abil-
ity to keep party extremists in
line is questionable. Further
plotting by Mende troops, who
represent the most immediate
threat to his regime is a dis-
tinct ossibility.
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NEW BORDER FLARE-UP MARKS ARAB-ISRAELI WAR ANNIVERSARY
A major fight along the
northern Jordanian-Israeli border
took place on the day before the
first anniversary of the June 1967
Arab-Israeli war, but the anni-
versary date itself passed rela-
tively quietly in the Arab world.
Both the Israelis and the
Jordanians had been extremely nerv-
ous over the possibility of
major trouble this week. The
Israelis had built up their forces
in the northern border area
shortly before the anniversary,
apparently as a precautionary
step. A firefight over the border
on 4 June triggered the most seri-
ous clash between Israeli and
Jordanian forces in over a month.
After the first border exchanges,
during which the Jordanians fired
on several Israeli settlements,
the Israelis sent up planes and
attacked the Jordanian town of
Irbid. Approximately 30 Jorda-
nian civilians were killed dur-
ing the attacks, and the fight
continued during most of the day.
Violence broke out in Jerusa-
lem on 5 June when Arab demonstra-
tors carrying flowers to commem-
orate the Arab deaths last year
were dispersed by Israeli police-
men in the Old City. A number of
demonstrators were wounded during
the incident, as were two Israeli
policemen.
In other parts of the Arab
world, the day passed calmly. A
protest march in Beirut in sup-
port of Arab terrorists took place
on 5 June without incident, and
speeches and demonstrations in
other Arab countries were vitri-
olic but orderly. Nasir made a
short speech in Cairo, stressing
the rearmament of Arab armies
since last June's debacle.
The Israelis were obviously
fearful that the Arab terrorist
groups would try some major strike
into Israeli-occupied territory
to mark the occasion. The terror-
ists, however, confined their
anniversary celebration to state-
ments that they are determined to
continue the revolution and ex-
pressions of mourning for their
fallen comrades.
Further border clashes are,
however, inevitable. Although
King Husayn has recently been
trying to curb terrorist activity
and has tried to use recent clashes
between terrorists and his own
security forces as an excuse for
a crackdown, sympathy for the
terrorists is still strong through-
nii+- the Arab F_ I
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Domestic problems overshadowed international affairs in Latin Ameri-
can countries again this week.
In Panama, backers of president-elect Arnulfo Arias are reportedly
doing everything in their power to forestall government attempts to cast
doubt on the legitimacy of Arias' victory. They fear that any legal shadow
over an Arias administration would prevent progress toward conclusion of
a canal treaty.
On 2 June, Jose Maria Velasco Ibarra was elected president of
Ecuador for the fifth time. The elections were conducted without serious
incident, even though some of the more intransigent members of various
political groups had earlier threatened to commit acts of terrorism.
In Peru, President Belaunde appointed a new cabinet, but serious
economic problems seem all too likely to continue and to create political
burdens similar to those Belaunde has faltered under in the past. The
President's own party, Popular Action, nominated the leader of the leftist
faction as its presidential candidate for next June and adopted a number
of leftist planks in its platform.
Students at the University of Chile occupied most of the university
buildings, which are scattered throughout Santiago, and brought teaching,
research, and administrative functions to a halt. The students seek greater
participation in the election of academic and administrative authorities.
Long-smoldering discontent among students in Argentina has tended
to become violent. On 29 May, police in downtown Buenos Aires broke
up a rowdy demonstration by almost 300 students protesting the lack of
academic freedom. The following day, some 700 students staged a demon-
stration at the University of Buenos Aires and were forcibly removed by
police. Leftist labor unions plan to support massive student demonstra-
tions scheduled for 14 June.
In Bolivia, antigovernment demonstrations connected with an ex-
tended teacher's strike have required police to intervene with tear gas.
Several bombs have been detonated by terrorists, one on 3 June just a
block away from the site of a conference between President Barrientos
and the leaders of the striking teachers. IE:
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PANAMANIAN GOVERNMENT TRYING TO INVALIDATE ARIAS VICTORY
Backers of president-elect
Arnulfo Arias reportedly are do-
ing everything in their power to
intimidate President Robles and
forestall any government action
that would cast doubt on the
legitimacy of Arias' electoral
victory.
On 30 May, immediately after
the National Elections Board
accredited National Union (NU)
leader Arias as the winner of the
election on 12 May, the govern-
ment-controlled Electoral Tri-
bunal issued a decree nullifying
all actions by the board. it
explained that it was acting be-
cause a progovernment appointee
was denied permission by the
National Guard to function as
board president. In addition,
the Supreme Court is rumored to
be preparing a decision upholding
the tribunal ruling.
Although the Robles govern-
ment would be unable to enforce
such rulings without guard sup-
port, NU leaders nevertheless
fear that a legal shadow over an
Arias administration would in-
hibit the US from concluding a
canal treaty.
Despite heavy pressure from
National Guard commandant Valla-
rino, and even from some Samudio
supporters, Robles has resolutely
refused to call off legal mach-
inations against Arias.
appear optimistic about the
prospects of removing Robles,
Vallarino thus far has opposed
a move that would probably re-
vive political tension.
Sensationalist news media
in both camps--some of them in-
filtrated by left-wing elements--
continue their inflammatory re-
porting. A pro-Samudio radio
station is spearheading a vitri-
olic anti-US campaign, highlighted
by charges that Arias has made
a secret pact with the US to de-
liver Panamanian consent on the
proposed canal treaties.
Arias, for his part, ex-
pressed a desire for cordial re-
lations with Washington during
a recent meeting with the US
ambassador. In discussing US
AID programs, the NU leader
alluded to a possible need for
budgetary support from the US.
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PROSPECTS FOR ECUADOR UNDER VELASCO SEEM UNCERTAIN
in a close three-way race,
Jose Maria Velasco was elected
president of Ecuador for the fifth
time on 2 June. The election
was probably the most efficient
and honest in the country's his-
tory and, despite only a one-
third plurality, Velasco's vic-
tory seems secure. Nevertheless,
the opposition to him from many
sectors and his previous three
ousters from the presidency indi-
cate that the 75-year-old Velas-
co's chances of finishing his
term, which starts on 1 September,
are not assured.
In separate balloting, Velas-
co's vice-presidential candidate
lost to Jorge Zavala Baquerizo,
the controversial and dynamic run-
ning-mate of center-left candidate
VELASCO
Andres Cordova. Although the
vice presidency is an unimportant
position, the combination of its
loss and an opposition majority
in the newly elected congress will
contribute to Ecuador's chronic
political unrest. Zavala's and
Velasco's animosity toward each
other has already cropped up in
postelection statements.
Some military leaders partici-
pated in Carlos Julio Arosemena's
ouster of Velasco in 1961, but
the present armed forces command-
ers seem willing to accept his
return to power. Their attitude
is influenced by his statements
that he would not again force the
retirement of senior officers, and
by reports of broad support in the
military ranks. The military
leaders will, however, keep wary
watch on political developments
because they feel a strong re-
sponsibility to maintain stability.
Velasco has already made sev-
eral statements marking the general
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direction he plans for his new admin-
istration. He re-emphasized his
interest in opening or expanding
trade with any country, including
Communist ones, to protect markets
for Ecuador's major exports, bananas.
On foreign policy, however, he said
he would not renew diplomatic re-
lations with the USSR or Cuba be-
cause he "would already have enough
problems."
He denied charges that he was
an enemy of the US, implying that
he could not afford to take such
a position. Recently, Velasco
criticized Interim President Otto
Arosemena's hostile attitude to-
ward the US and his ouster of the
US ambassador, saying he would
rectify such mistakes. He has also
said that he agrees with the con-
cept of cooperative programs as en- 25X1
visioned in the Alliance for Pro-
gress, but that he considers
"ponderous and cumbersome."
PERU'S NEW CABINET FACES OLD PROBLEMS
President Belaunde's cabinet
changes last week may be an attempt
to deal with Peru's economic prob-
lems by altering form rather than
substance.
Preliminary reaction to the
new cabinet was mixed. Most oppo-
sition newspapers have criticized
it, although there is a general feel-
ing that judgment should be reserved
until the cabinet's program is
known. The US Embassy in Lima com-
ments that the cabinet contains some
good elements but does not immedi-
ately inspire confidence.
Although the President has met
demands by the opposition APRA party
for a cabinet of technicians, he
has done nothing about its call for
specific actions. APRA wants the
government to cut expenditures,
solve the long-standing dispute with
the International Petroleum Company,
and refinance the foreign debt be-
fore resorting to new taxes. Peru
might well encounter difficulties
in obtaining relief from foreign
debt payments (scheduled to more
than double in 1968) and substantial
cuts in other expenditures would
be very difficult politically.
Wages, social benefits, and military
purchases account for the rest of
the increase in expenditures budg-
eted for 1968.
The issue of new taxes has been
a major stumbling block to coopera-
tion between the executive and con-
gress, as APRA believes that much
of its recent political resurgence
is attributable to its stand against
additional taxes. Unless this dis-
agreement can be resolved, the new
cabinet is unlikely to have more
success than the old, and Belaunde
will continue to try to muddle
through until his term ends in July
1969.
Belaunde faces additional prob-
lems from within his own Popular
Action Party. The party's national
convention has nominated leftist
leader Edgardo Seoane as its presi-
dential candidate. Seoane is pres-
ently first vice president of Peru
and has called for nationalization
of the US-owned International Pe-
troleum Company. Further leftward
moves by the party could provoke
a complete rupture between Belaunde
and the Popular Action leadership.
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CHILEAN STUDENTS DEMAND UNIVERSITY REFORM
A dispute over student "co-
government"--participation by
students in the election of aca-
demic and administrative author-
ities at the University of Chile--
has resulted in student occupa-
tion of most university build-
ings and complete cessation of
normal teaching, research, and
administrative functions.
over these personnel groups have
met with mixed success so far.
Legislative approval of the
bill depends on cooperation of
the Communists with the Christian
Democrats. Such cooperation
played a part in the passage of
the 1968 wage adjustment bill and
the settlement of postal and
teachers' strikes.
The problem began on 23 May
when the university council voted
to reorganize the Marxist-domi-
nated faculty of philosophy and
education, which had permitted
student participation in the elec-
tion of the director of the Peda-
gogical Institute. The Socialist
rector of the university, Eugenio
Gonzalez, thereupon resigned, and
various student groups occupied
the university buildings. Gon-
zalez' replacement probably will
be Enrique Silva Cimma, a Radi-
cal who heads the Soviet-Chilean
Cultural Institute.
On 30 May, President Frei
submitted to Congress his higher
education bill, designed to gov-
ern student participation and the
growth of the public system of
higher education. The proposal
would permit each university to
decide how students are to par-
ticipate in the choice of the
highest academic authorities, but
students would be permitted no
voice in the choice of professors
and researchers.
The bill would also allow
professors and researchers to par-
ticipate in key decision-making
bodies, thus diluting the effect
of student participation. Com-
munist efforts to gain control
The recent student disturb-
ances have provided an excellent
illustration of the Communist
Party's attempts to maneuver
between its Socialist allies and
the leftist faction of President
Frei's Christian Democratic
Party (PDC). On 29 May the Com-
munist and Christian Democratic
student groups came to an agree-
ment, isolating the more extrem-
ist students belonging to the
Socialist Youth and the Movement
of the Revolutionary Left (MIR).
The Communists later withdrew,
however, partly because of de-
fections to the MIR and partly
to placate the Socialists. The
directing group of the University
of Chile student federation then
gave its Christian Democratic
president an overwhelming vote of
confidence, thus defeating a Com-
munist proposal for his resignation.
The Communists would like to
work out an alliance with the
Christian Democratic leftist fac-
tion, to which most PDC students
belong, but they are unwilling
to break completely with the
Socialists. This type of maneu-
vering can be expected to inten-
sify with the approach of the con-
ressional elections in March 1969.
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