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April 11, 1969
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Approved For Release 2007/03/06 : CIA-RDP79-00927A007000 40001-2 Secret 25X1 DIRECTORATE OF INTELLIGENCE WEEKLY SUMMARY State Dept. review completed Secret 41- 11 April 1969 No. 0365/69 70 . S3 7 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/OSOURk. tRDP79-00927A007000040001-2 (Information as of noon EST, 10 April 1969) Far East VIETNAM The Communists appear to have ended their spring offensive, but there is no indication that major enemy units are withdrawing out of the country. Meanwhile, the Communists are still side-stepping the issues raised by President Thieu's recent polit- ical initiatives, apparently recognizing that the South Vietnamese President has upstaged them on the peace front. LAO FORCES ABANDON SOUTHERN BASE AFTER LONG SIEGE Low morale and difficulties in moving fresh troops and supplies into the government garrison at Thateng in south Laos led local defenders to evacuate their positions on 3 April. TOKYO PREPARING FOR OKINAWAN NEGOTIATICNS The Japanese Government's overriding interest in securing Okinawa's return is dramatized by a re- shuffling within the Foreign Ministry to strengthen Japan's negotiating team. Europe SECRET Page i WEEKLY SUMMARY 11 Apr 69 Page 1 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2007/O~QCJA-RDP79-00927A007000040001-2 CZECHOSLOVAK LEADERS ACT TO ASSUAGE SOVIET FEARS Dubcek and other top party leaders, apparently with a new cohesiveness, have begun the arduous task of trying to convince the people that they must comply with the new restrictive domestic policies intro- duced last week. YUGOSLAVIA AND RUMANIA ARE TARGETS OF RUSSIAN POLEMICS 10 Yugoslavia and Rumania have aroused Moscow's ire because of their uncompromising attitudes and lack of support for the way the Soviets handled the Czech- oslovak crisis and the border dispute with China. HUNGARY TRIES TO BALANCE DOGMATISTS AND LIBERALS Hungarian leader Kadar is faced with an embryonic resurgence of conservative elements that could sour his delicately constructed relations with Hungary's intellectuals. RIFT WIDENING IN FINNISH COMMUNIST PARTY The Finnish Communist Party, seriously split since its 15th congress closed on 6 April, now faces the possibility that its conservative and liberal wings will break apart and form rival parties. CANADA TO REDUCE NATO FORCES The announcement last week that Canada will remain in NATO but carry out a "planned and phased reduc- tion" of its forces in Europe is the first of the Trudeau government's long-awaited decisions on de- fense policy. SEC RE 1' Page i i WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2007/0Sft DP79-00927AO07000040001-2 INTELSAT MEMBERS RECONSIDER POSITIONS Nations participating in the recent INTELSAT confer- ence in Washington have expressed little surprise that no final agreement was reached, and preparatory meetings will begin soon to set the stage for another meeting in the fall. Middle East - Africa MIDDLE EAST CONTINUES IN QUIET TURMOIL Artillery exchanges along the Suez Canal, the first Israeli air strike on the Jordanian port of Aqaba, and an Iranian show of strength against Iraq high- lighted developments in the Middle East this week. EGYPT'S OIL REFINERY COMPLEX AT SUEZ HARD HIT The extensive damage caused by the shelling of the Suez oil refinery complex last month, for the second time in less than two years, demonstrates Israel's capability to disrupt Egypt's oil economy. SOVIET PRESIDENT VISITS ALGERIA AND MOROCCO Soviet President Podgorny's visits testify to the growing influence of the USSR in the western Medi- terranean. The visit to Algeria accomplished its ceremonial purposes, although some political diver- gences were not entirely bridged. Podgorny's recep- tion in Morocco was more on the correct side, but the visit was one more sign of the gradual warming of Soviet-Moroccan relations. 25X1 COUNCIL SHAKE-UP COMPLICATES GHANA'S POLITICAL SITUATION The replacement of General Joseph Ankrah as head of Ghana's military government by young and mercurial Brigadier Akwasi A. Afrifa is likely to cause a fundamental shift in power relationships. SECRET Page iii WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 SECRET Western Hemisphere PANAMANIAN NATIONAL GUARD EXTENDS ITS CONTROL The guard leadership seems intent on remaining in control for some time regardless of the outcome of any future elections. UNCERTAINTY PREVAILS IN PERU The deferral of US economic sanctions under the Hickenlooper amendment brought an initial reaction of relief in Peru, but government leaders are now concerned that badly needed credit will be withheld and that foreign investors will defer action until a final decision is reached. SECRET Page iv WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 200-SW RB:I -RDP79-00927A007000040001-2 The Vietnamese Communists appear to have ended their spring offen- sive. There is no indication, however, that enemy units are withdrawing to border sanctuaries or out-of-country bases. There were a few sharp clashes east of Saigon this week, but they were the result of allied sweep operations rather than any enemy initiative. The Communists apparently have been caught off guard by President Thieu's recent political initiatives. Thieu's six-point peace plan, which he presented to the National Assembly in Saigon on 7 April, has been only ineffectively rebutted by the Communists. The Liberation Front and the North Vietnamese have been sidestepping Thieu's proposals for negotiations but have avoided rejecting them outright. There has been a virtual news blackout on the proceedings of the Chinese Communist Party's ninth congress ever since it opened on 1 April. This lack of substantive reporting-in sharp contrast to usual practice in Communist countries-suggests that delegates are engaged in heated debate on policy issues which the leadership wishes to conceal. The abandonment of the government position at Thateng in southern Laos late last week does not significantly alter the military equation in the Bolovens Plateau area. The loss of the position is, however, another step in the Communists' campaign begun in late 1967 to isolate the plateau and keep government forces confined to areas along the Mekong 1Ziver. The government withdrawal came after a costly five-month effort by the Com- munists to take the outpost. The Japanese Government has strengthened its team for forthcoming negotiations with the US on the return of Okinawa to Japanese administra- tion. Prime Minister Sato's major problem in ariranging reversion continues to be to find a formula acceptable to both the US Government and the Japanese people regarding the status of US bases in Okinawa after reversion. The Japanese and Okinawan peo le are adamantly opposed to the presence of nuclear weapons in Okinawa. SECRET Page 1 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2007/(i jl) RDP79-00927AO07000040001-2 R(p VIETNAM The Communists appear to have ended their spring offensive. The level of violence over the country has dropped dramatically in the past week. The enemy may be using the current period to refit and rest many of his major formations, some of which have suffered sub- stantial casualties. Prisoners have also hinted that the Commu- nists are now holding indoctrina- tion sessions to review the re- sults of the recent campaign. There is no indication, however, that enemy units are withdrawing to out-of-country bases and border sanctuaries. Meanwhile, there have been a few sharp clashes east of Sai- gon this week, but they have re- sulted from allied sweeping oper- ations rather than any initiative on the part of the enemy. Major cities have remained free of shellings, although four rockets struck the northern outskirts of Saigon on 8 April causing light casualties and damage. Political Developments in South Vietnam April, Thieu offered mainly a restatement of Saigon's existing policy of "national reconciliation" in exchange for Communist military withdrawal, but he also subscribed to the more distant goal of reun- ification based on free elections. Thieu reassured militant nationalists, who have criticized his offer of secret talks, that the government could now afford to take such initiatives in the negotiations because of its strong position in South Vietnam. Moreover, he suggested that ne- gotiations could be conducted "under several formulas, in several places, and at several levels," suggesting a willingness to meet with the Communists out- side the forum of the Paris talks. Thieu devoted most of his address, however, to the need to begin now to unite anti-Communist political elements against the day that political competition with the Communists begins. He also announced that he will per- sonally head a "broadly based" po- litical organization, to include all individuals and groups that approve of his program. President Thieu has followed up his 25 March announcement that Saigon is ready for secret talks with the National Liberation Front by outlining a six-point program to end the fighting. In his state-of-the-nation address to the National Assembly on 7 Page 2 Thieu had previously indi- cated that he would identify imse f with the Lien Minh at a national convention of this progovernment front to be held later this month. Presiden- tial secretary General Nguyen Van Huong--Thieu's political aide--is SECRET WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/1J RDP79-00927AO07000040001-2 reportedly working on preparations for the convention, including a reorganization and expansion of Lien Minh activities and efforts to persuade new groups to join the front. President Thieu has ~~ expressed confidence 1 Ea a ility to organize the South Vietnamese people politically, although he clearly realizes that a number of ambitious politicians will be unmoved by the cause of national unity. Despite Thieu's optimism, he faces problems in trying to mobilize non-Communist political groups. To date, the Lien Minh has failed to organize effectively outside of Saigon, and it is likely to be hampered by the personal rivalry between its current leaders. In addition, initial reac- tion in Saigon to Thieu's Na- tional Assembly speech indicates that although there is widespread hope that his efforts will suc- ceed, there is also considerable skepticism. Many nationalist politicians appear to welcome the move, although they have generally reacted cautiously, and the mili- tant Buddhists have expressed their opposition. Thieu believes the major Communist threat will come at the village level and he intends to take measures immediately to strengthen the government's posi- tion there. He recently told high US officials that he believes he has about six months to get Page 3 ready for political competition with the Communists before the peace negotiations reach their "culmination point." To meet the Communist threat at the local level, the government will try to increase its cadre force in the hamlets and villages, improve local administration, and raise the standard of living of people in rural areas. Communist Political Reaction The Communists are still side-stepping the issues raised by President Thieu's political initiatives. They apparently recognize that the South Vietnam- ese President has upstaged them on the peace front, but to date their rebuttal has been both slow and ineffective. The Liberation Front made a special effort to recapture some of the headlines in Paris by call- ing an unusual and formal press conference on 7 April. Newsmen who came anticipating a thorough- going riposte to President Thieu's six-point peace plan were treated only to a 15-minute harangue on alleged allied atrocities in South Vietnam, and most of them walked out before the conference ended. In general, the Front spokesman avoided any substantive comment on President Thieu's six points. He did say, however, that the Front would never pay the price of dissolving itself for the privilege of participating in the noli-nical life of South Vietnam. 25X1 SECRET WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2q?,T,/h CIA-RDP79-00927A007000040001-2 LAO FORCES ABANDON SOUTHERN BASE AFTER LONG SIEGE Low morale and difficulties in moving fresh troops and sup- plies into the Thateng garrison in south Laos led local defenders to evacuate their positions on 3 April. Thateng is the first impor- tant government position in south- ern Laos to fall to the enemy this year. The withdrawal came after a costly five-month effort by the Communists to take the outpost. Government forces still control a high point overlooking the camp, however, and plans have been drawn up to strengthen this position. The loss of the garrison may eventually open up to the enemy a motorable road onto the east- ern portion of the Bolovens Pla- teau, but it does not signifi- cantly alter the military equa- tion in the plateau area. It is, however, another step in a Com- munist campaign that began in late 1967 to isolate the plateau and keep government forces con- fined to areas along the Mekong River. Recent Pathet Lao harass- ments along Route 13 appear to be part of this effort, and fresh pressure against small government positions at Keng Nhao and Paksong may be de- signed to remove the last ves- tiges of government presence in the northern portion of the pla- teau. In northern Laos, meanwhile except for ground assaults against the government's newly reoccupied position at Phu Cum. the Commu- nists have not pressed their of- fensive. Government forces, for their part, continue to make some progress in diversionary attacks in the Plaine des Jarres area. SECRET WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 200773p,A-RDP79-00927AO07000040001-2 TOKYO PREPARING FOR OKINAWAN NEGOTIATIONS The Japanese Government's overriding interest in securing Okinawa's return is dramatized by a reshuffling within the For- eign Ministry to strengthen Ja- pan's negotiating team. A major feature of last week's reorganization was the appointment of aggressive diplomat Hiroto Ta- naka as roving ambassador to as- sist Ambassador Shimoda in Wash- ington. The naming of this spe- cial emissary, who will spend half his time in Washington, is designed to present more effec- tively the Japanese position on the timing and conditions for Okinawa's return to Japanese ad- ministration. A deputy vice minister was designated coordi- nator of all Okinawan matters as part of the reorganization. These moves indicate that the Japanese are completing the final groundwork for negotiations on Okinawa that they hope will be successfully concluded during the visits to Washington of Foreign Minister Aichi in June and Prime Minister Sato later this year. The toughest problem facing Sato in arranging Okinawa's re- turn is to devise a formula for the post-reversion status of US bases acceptable to both the US Government and the Japanese pub- Page 5 lic. The Japanese people clearly want the same "homeland-level" status for Okinawan bases that governs US bases in Japan. This would preclude special weapons and require consultations prior to major force deployments. Although Sato has not fore- closed any negotiating options, he now appears to favor a formula for reversion that would grant fairly liberal base rights in ex- change for removal of nuclear weapons. The strong public pres- sures Sato must take into account were reflected in a nationwide poll early this year; less than three percent of the Japanese wou:Ld tolerate nuclear weapons on Okinawa. Sato's suggestions last February that the presence of nuclear weapons in Okinawa following reversion would not vio- late Japan's constitution drew harsh and widespread criticism from the press, opposition, and public. Serious dissension within the ruling Liberal Democratic Party on the nuclear question is another compelling factor shaping Sato's negotiating tactics. Sato is well aware that party rivals such as faction leaders Maeo and Miki --both outspoken proponents of "homeland-level" reversion--would quickly exploit any surge of popular feeling against the SECRET WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 20 /0 /06 ? CrIA-RDP79-00927AO07000040001-2 government's handling of the Okinawa issue in their attempts to oust the prime minister as party leader. The increasing popular pres- sure for reversion in Okinawa itself over the past year is yet another prod for Japan to move ahead rapidly on the issue. Base- related incidents, including the crash of a B-52 last November, have given added momentum to local leftist efforts to rein- force their campaign for "imme- diate reversion" with a drive against any US military presence. This week, the Ryukyuan legisla- ture unanimously passed a strongly worded resolution, the 17th of its kind, calling for reversion without nuclear weapons or free US use of bases. SECRET Page 6 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 200/ /i :I A-RDP79-00927A007000040001-2 The 20th anniversary of the North Atlantic Treaty is being celebrated in Washington this week with clear signs that the European appetite for detente has been whetted by the Warsaw Pact appeal for a European security conference. Skeptics are unconvinced that the Soviets are sincere, but many of the NATO countries apparently wish to explore the matter further. Well aware of this, Moscow actively supported the appeal. Soviet diplomats presented the case for a conference to key Western governments in reasonable terms, even letting it be known that Moscow had no objection in principle to US participation. A Soviet government statement on 8 April blamed NATO for all the ills of Europe and concluded with a call for a conference. The substance of the Soviet proposal remains essentially un- changed from similar ones made in 1966 and 1967, and Moscow may have achieved its main objective simply by stirring hopes of a European settle- ment as the NATO ministers gathered. The Sino-Soviet border remained quiet although Soviet propaganda continued the attack. In Czechoslovakia, Dubcek and the other top party leaders have appar- ently been able to come together in a new cohesiveness. Nevertheless, the domestic political situation became more complicated as the regime effected new restrictive policies in response to Soviet demands for a clampdown. A high-level Polish delegation led by party boss Gomulka arrived in East Berlin for two days of talks with the irascible East Germans, probably about the new European security proposals, as well as economic cooperatio Rumanian Foreign Minister Manescu's three-day visit to Moscow apparently failed to produce any agreement on major issues, including revision of the mutual assistance pact, European security, or the China border issue. SECRET Page 7 WEEKLY SUMMARY 11 Apr 69 25X1 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 n Approved For Release 203/ffIA-RDP79-00927A007000040001-2 CZECHOSLOVAK LEADERS ACT Dubcek and other top party leaders, apparently with a new co- hesiveness, have begun the ar- duous task of trying to convince the Czechoslovaks that they must comply with the new restrictive domestic policies introduced last week. The regime also seemed to be searching for ways to maintain its popular support despite new Soviet pressures for the kind of clampdown that doubt- less would alienate the popula- tion. The authorities, neverthe- less, are applying the most unpop- ular restriction--press censor- ship. They reshuffled the edi- torial staff of the main party daily, Rude Pravo, suspended or confiscated some weeklies, and appointed a new government censor. Journalists who are Communist Party members have been warned that they face disciplinary pro- ceedings if they attack party policy. This is only a half TO ASSUAGE SOVIET FEARS measure, however, for there are many non-Communists in the media. Some organizations, like the trade unions, are hoping to avoid the imposition of outside censor- ship by agreeing to scrutinize the content of their own publi- cations. In a major speech last week, Dubcek tried to justify the new restrictions by acknowledging that the recent anti-Soviet demonstra- tions had precipitated the most serious political crisis since the invasion, and he hinted that the Russians had lost their patience. He warned that another anti-Rus- sian outburst would mean the end of his regime, the demise of the reform program, and the return of Soviet occupation troops and tanks to major urban areas. Many Czechoslovak organiza- tions have reaffirmed their sup- port of the present leaders and reluctantly approved the new re- strictive policies. Progressive Prague Celebration of Hockey Victory Over Russians, Which Led to Violent Anti-Soviet Eruptions on Night of 28-29 March SECRET Page 8 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 200S-7L9& 'pIA-RDP79-00927A007000040001-2 trade union leaders agreed to try to calm the situation, and an- nounced that for the first time since the invasion they will con- tribute to Dubcek's "normaliza- tion" efforts by exchanging dele- gations with the trade unions of the invasion powers. The rank and file workers, however, have threatened a general strike to protest anticipated price increases--if they are an- nounced. Students in Prague also plan to strike in the near future over newly imposed press censor- ship. The workers might call a general strike in this situation, too, if there are harsh reprisals against the students. Czechoslovak leaders have enough time, however, to try to mollify the students and workers, but may have difficulty because of the regime's growing credi- bility gap. In an effort to dis- courage further public anti-Soviet provocations, Interior Ministry officials took immediate security precautions, and small, armed Czechoslovak military units joined reinforced police patrols. The leadership also has moved to shore up its popular support in the faction-ridden Czechoslovak Army. President Svoboda last week made four trips to key military posts, probably to use his immense prestige to try to ensure that the armed forces will remain ready and will- ing to follow the regime's direc- tives. As a sop to Moscow, how- ever, Prague cracked down on anti- Soviet dissidence in the armed forces and plans to punish mili- Page 9 tary personnel who took part in anti-Soviet disturbances. Despite the complications it has imbued into the domestic situation, the recent crisis proved once again that when the chips are down the top leaders-- all moderates--can stick together. Even Slovak party chief Husak, a "realist" who at times has been highly critical of the party leadership, is said to have ral- lied support for Dubcek and to have stiffened the backs of wa- vering moderate and progressive leaders, who seemed ready to be stampeded into accepting Soviet demands for a harsh crackdown. Regardless, Dubcek again is walking a tightrope. He must persuade Moscow that he will no longer drag his feet in respond- ing to its directives. At the same time, to maintain his re- gime's stability, he must cater to progressive groups such as the workers, students, and intellec- tuals. Meanwhile, Dubcek's pro- pensity to temporize, which at present he seems unwilling to abandon, appears likely to gener- ate :aew crisis situations. Moscow welcomed the proposed restrictive measures and gave ex- tensive press coverage to Prague's statement promising a crackdown on "concealed antisocialist forces." The Soviets made it clear, how- ever, that they would be watching carefully to see that Prague's actions matched its words. The departure by mid-week of Defense Minister Grechko and Deputy For- eign Minister Semenov, whose strong representations had goaded Prague into action, suggests that the So- viets have been at least tempo- rarily mollified. SECRET 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 20%7~3IA-RDP79-00927A007000040001-2 YUGOSLAVIA AND RUMANIA ARE TARGETS OF RUSSIAN POLEMICS Yugoslavia and Rumania have aroused Moscow's ire because of their uncompromising attitudes and lack of support for the way the Soviets handled the Czecho- slovak crisis and the border dis- pute with China. In the past week, Soviet press articles clearly spelled out Moscow's vexations. Under the guise of criti- cizing the Yugoslav press, the Soviet daily Sovetskaya Rossiya of 4 April castigated Belgrade for engaging in an "anti-Soviet" campaign. The article was par- ticularly critical of Belgrade's neutrality on the Sino-Soviet border dispute. It also took the Yugoslavs to task for criticizing Soviet policy in Czechoslovakia and for equating the Warsaw Pact with NATO. Sovetskya Rossiya touched a sensitive nerve when, in addi- tion to taking note of Yugoslavia's economic difficulties, it observed that Yugoslavia owed its security to the existence of the Warsaw Pact. The article had steered clear of criticizing the regime directly, but Belgrade immediately replied that it considered the at- tacks to be upon the entire range of its domestic and foreign poli- cies, in this way reserving the right to reply in the future. An article in Pravda of 7 April, critical of bourgeois nationalism" and those who would "juggle with the concept of sovereignty," had special meaning for Bucharest because it coin- cided with the arrival in Moscow of Rumanian Foreign Minister Manescu, who had been invited for an exchange of views. The un- compromising article contained the clearest restatement in re- cent weeks of Moscow's doctrine of limited sovereignty. Moscow may have been motivated partly by a desire to establish a posi- tion from which to bargain with Manescu on revising the Soviet- Rumanian mutual defense treaty, which expired in early 1968. Any reiteration of this principle, however, with its veiled impli- cation of justified intervention in Eastern Europe, is unnerving to leaders in both Bucharest and Belgrade. The Doctrine of Limited Sovereignty When a threat arises to the revolutionary gains of a people in any country and thus... to the fraternal community, it is the international duty of the socialist states to do everything to nip this threat in the bud.... i~ravdu, 7,9pril 1969 Elsewhere in the Balkans, Bulgarian pressure on Yugoslavia over Macedonia may be abating. Foreign Minister Bashev, in a major policy review on 4 April, publicly disclaimed his country's responsibility for the squabbling over that issue for the last year and a half and denied that his country had any territorial claim on Yugoslav Macedonia. Bashev also had kind words for Bulgaria's other neighbors--Rumania, Turkey, Greece, and Albania. Sofia appar- ently wants to counter the ill ef- fects of its unquestioning support of the USSR and to put the best face possible on Bulgarian for- eign policy before an official visit by party boss Zhivkov to SECRET Page 10 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release CIA-RDP79-00927AO07000040001-2 HUNGARY TRIES TO BALANCE DOGMATISTS AND LIBERALS Hungarian leader Kadar is faced with an embryonic resur- gence of conservative elements that could sour his delicately constructed relations with Hun- gary's intellectuals, most of whom are liberals whose goodwill is necessary for the viability of his moderate regime. The stronghold of the hard liners is the Philosophical In- stitute of the Academy of Sci- ences, and the prime mover is its ex-chief, Josef Szigeti. Recently, the party had demoted him from his chairmanship because of his authoritarian methods, but Szigeti is now maneuvering to undermine Kadar's working rela- tions with responsible liberals. zige i s politi- cal durability and influence is derived from his ties with con- servatives in the Soviet Union and East Germany. Since the early sixties, the Hungarian party has largely kept its promise of simultane- ously preventing the return of Stalinist attitudes while keep- ing "dangerous" liberals under control. Until censorship was lifted in Czechoslovakia, for example, Hungarian intellectuals probably had the most freedom of expression in Eastern Europe. Since the intervention, however, the liberals have borne the brunt of the authorities' crack- down against ideological devia- tio::is, and they are now complain- ing that it has been too one- sided. The party's failure to si- lence Szigeti and his supporters illustrates how insecure it is about Moscow's skepticism over Kadar's gradual liberal reforms. The Soviet Embassy staff, accord- ing to current Budapest rumors, is now closely watching even the most innocuous regional publica- tions for signs of "dangerous" attitudes. In this tense atmos- phere, the conservatives appar- ently feel free to work against liberal policies. Kadar has tried to restore both the delicate balance and the calm of the period before the Czech invasion. Szigeti's demotion was one aspect of this effort. A party-government com- munique in early March reiterated the party's determination to fight both dogmatists and irre- sponsible liberals, and averred that political reforms were to be directed from the top rather Courageous thinking is not individual adventurism anc! not gambling with the life of the people, but is always an integral part of the responsibility felt for the cause of the country, the people, reality, and socialism. According to our experiences, both the dogmatic and revisionist attitudes are equally dan ger2us. Hungarian party secretary Bela Biszku in an address to the party political academy on 13 March 1969 SECRET Page 11 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 20~,70/,QIA-RDP79-00927A007000040001-2 than forced by pressures from be- low, as happened in Czechoslovakia. This tactic has been only partly successful. Conservative attacks on liberal proponents of meaningful sociological research have lessened, for example, but party controls over liberal sociolo- gists have been increased, and lib- eral apprehensions over seeping Stalinism have not been assuaged. In many ways, the cultural scene mirrors Kadar's main political di- lemma: maintaining movement in his domestic reforms without causing a coalescence of conservative opposi- tion or alarming the Soviet Union. RIFT WIDENING IN FINNISH COMMUNIST PARTY The Finnish Communist Party (FCP), seriously split since its 15th congress closed on 6 April, faces the possibility that its con- servative and liberal wings will break apart completely and form ri- val parties. The liberals were aided in their take-over of the FCP by a walk- out of the conservatives over the selection of the new central com- mittee. In their absence, the lib- erals swept out most of the obstruc- tionist conservatives in the leader- ship. In electing a successor to conservative party secretary Ville Pessi, however, the liberals re- vealed their own internal differ- ences. Lapland district secretary Arvo Aalto defeated organization secretary Erkki Kivimaki, who had been groomed for the post. The victory of Aalto, a firm liberal, over Kivimaki, a moderate, was also a sign of grass-roots discontent with the party bureaucracy. The conservatives, whose strength is concentrated in the traditional areas of Finnish Marx- ism in southern Finland, have an- nounced they will call a congress of their faction on 26 April to de- cide whether to remain within the party or form their own "Communist Page 12 Workers' Party." The return of some of the conservative dissenters to the FCP congress before its Con- clusion, however, is a sign of re- sistance to an actual split. Until the break within the party came into the open, the ma- jority liberals had held that the minority should accept the deci- sions of the majority, but they al- lowed it full freedom for propa- ganda and organizational activity. The liberals now condemn the con- servatives for continuing such ac- tivity, maintaining that it is a defiance of party discipline and contrary to Leninist procedure. A final split in the FCP could significantly influence the up- coming parliamentary elections, which by law must be held by March 1970 but can take place earlier. The FCP, operating through the People's Democratic League, usually gets about 20 percent of the vote, and of the 42 seats it won in Par- liament in 1966, almost one fourth can be identified with the conserv- ative faction. Since 1966, the FCP has also had the distinction of being the only Communist Party taking part in a Western European government. SECRET WEEKLY SUMMARY 11 Apr 69 25X1 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2QI Of ,iCIA-RDP79-00927AO07000040001-2 CANADA TO REDUCE NATO FORCES The announcement last week that Canada will remain in NATO but carry out a "planned and phased reduction" of its military forces in Europe is the first of the Trudeau government's long- awaited decisions about future Canadian defense policy. The de- cision is a compromise between several cabinet factions, includ- ing one that favors withdrawing completely from NATO. The decision, outlined in these general terms, actually rep- resents what the previous admin- istration did but with consider- ably less fanfare. Trudeau, how- ever, may well have in mind more sweeping cuts than the not insig- nificant reductions made in pre- vious years. In announcing the decision, he said only that the scope and timing of the cuts may not be determined for some time. In Europe, Canada now has an air division with some 100 aging fighter-bombers and a mechanized army brigade of less than 6,000 men. Ottawa could cut back by not replacing the aircraft when they become obsolete in the early 1970s, or it might retain both air and ground elements while mak- ing substantial reductions in each. More drastic cutbacks, how- ever, might cost Ottawa the po- litical voice it wants in alli- ance affairs. Trudeau talked only in the vaguest terms about other related strategic aspects of the deci- sion. When asked if this move foreshadowed a reduction in the over-all military budget, he re- plied, "not necessarily." Ques- tioned whether the decision is aimed at a withdrawal of all Ca- nadian forces from Europe at some time, Trudeau said, "maybe, maybe not." Trudeau did say that Canada will continue to cooperate with the US in the defense of North America. He raised the possibil- ity that the forces recalled from Europe will be used "to play a role in Canada which is now played by foreigners." This statement suggests that Ottawa might in- crease its contribution to NORAD, which it has long been reluctant to do. Trudeau might make such a gesture in hopes that it would strengthen Canada's voice in de- cisions about continental defense, such as the deployment of an ABM system. Press reaction in Canada. has been extremely mixed, with criti- cism by both pro- and anti-NATO editorialists.muted by the lack of specific information. The conserv- ative opposition has attacked the government for confusing Canada's allies by not giving details. There has been only limited foreign reaction so far. West German Foreign Minister Brandt, for example, commended Canada on its decision to remain in NATO. He expressed concern, however, about the effect of the Canadian withdrawal on possible East-West negotiations for mutual force re- ductions and on other alliance members who have talked about re- ducinq their own commitments. SECRET Page 13 WEEKLY SUMMARY 11 Apr 69 25X1 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 SECRET INTELSAT MEMBERS RECONSIDER POSITIONS Participants in the recent INTELSAT conference in Washing- ton, having failed to agree on future permanent organizational arrangements, are now re-examin- ing and sharpening their posi- tions for future meetings. All 68 INTELSAT members, together with nearly 30 observer nations, met for four weeks beginning on 24 February to try to set up definitive future arrangements for the satellite telecommunica- tions consortium. Several im- portant issues remain unresolved, however, and a second plenary meeting is planned for November; meanwhile a preparatory committee will meet next month to work out draft agreements. The major issues yet to be negotiated involve the organiza- tion and structure of the con- sortium. A chief concern of the delegates is the role of the US-- and COMSAT, its representative-- in INTELSAT's future. There was especially strong sentiment for replacing COMSAT as the manager of the consortium with a more international body. Many mem- bers also insist upon new voting procedures in the assembly and the governing body to eliminate the current veto power of the US. Other items under discussion included the consortium's legal personality, its procurement policy, and the existence of future regional satellite systems. Most participants were not surprised that no definitive agreement was drafted. There is general satisfaction that the conference permitted a useful exchange of views, the isolation of points of disagreement, and the education of smaller coun- tries in the complexities of satellite telecommunications. Some participants have ex- pressed the hope that the US will soften its position before the November meeting. A West German Foreign Ministry official, for example, has asked that the US negotiate INTELSAT's arrangements with an understanding of their political importance to Europe; he views the principal conflict as one between efficiency and political considerations. A Belgian minister has said that the resolution of major conflicts at the November meeting will de- pend upon the willingness of mem- bers--"particularly the US"--to engage in "serious negotiations." The Soviets attended the conference as observers. A So- viet minister stated 25X1 that the Soviets desire a single global telecommunications satel- lite system, but they also in- sist that membership be univer- sal--the US has favored member- ship in the International Tele- communications Union as a pre- requisite. The Soviets also in- sist that regional systems be permitted, that control of the consortium be internationalized, and that votes by distributed "more democratically." The Soviet re- presentative indicated that Mos- cow would wait until the conclu- sion of INTELSAT's negotiations before acting on its own Inter- sputnik proposal. SECRET Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/?.-RLRDP79-00927A007000040001-2 In the Middle East, shooting incidents continue to be the order of the day, with large-scale artillery duels across the 13uez Canal occurring sporadi- cally. The tacit Israeli-Jordanian truce in the Gulf of Aqaba was broken by a fedayeen rocket attack on the Israeli port of Elat, for which Israel retaliated with an air strike against Aqaba on the opposite shore. On the diplomatic front, efforts to work out a political solution to the impasse are now concentrated in New York, where the Big Four representatives held their second meeting this week. Pakistan's martial law administration is firmly in power, and its spokes- men continue to pledge efforts to redress the ills that led to the protracted violence against the Ayub regime. In a news conference on 10 April, Yahya Khan stressed his intention to end corruption in government and promised new attempts to meet the demands of students, workers, and peasants. Meanwhile, prompt arrests are being made for violations of the strict martial law regulations and at least one serious clash has occurred in East Pakistan between the police and demonstrators. In the Nigerian civil war, a federal drive into Biafra from the north has temporarily stalled, but only after some federal forces advanced to within 11 miles of Umuahia, the secessionist capital. Umu.ahia does not appear to be in any immediate danger, but the Nigerians will probably soon return to the attack. The fall of the secessionist capital would represent a significant psychological victory for Lagos, but it would not mark the end of the conventional war, as Biafran leader Ojukwu would almost certainly move his headquarters elsewhere in Biafra. President Toure's witch hunt against alleged imperialist-inspired con- spirators has brought Guinea's long-declining economic life to a near stand- still and has stirred tension and discontent throughout the country. The national treasury is believed to be empty and food staples are in extremely short supply. Toure appears to have disposed of whatever threat may have existed, however, and retains the u er hand. SECRET Page 15 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 20F. FRE. ,.CIA-RDP79-00927A007000040001-2 MIDDLE EAST CONTINUES IN QUIET TURMOIL As four-power talks seeking a solution to the Arab-Israeli conflict began in New York this week, Egyptian and Israeli gun- ners exchanged artillery fire across the Suez Canal, Iranian military forces continued a de- monstrative buildup along the Iraqi-controlled Shutt-al-Arab River, and Israeli aircraft for the first time made a retaliatory attack on the Jordanian port of Aqaba. Syria's Baath party emerged from a protracted congress with a rearranged leadership coalition that precariously balanced the two principal factions. In the Arabian Peninsula, meanwhile, both Yemen and Southern Yemen produced new but only slightly altered cabinets. Egypt-Israel Sporadic but intense firing has occurred along the Suez Canal as both Egypt and Israel continue defensive preparation in antici- pation of yet more shooting. To minimize the effects of costly artillery duels, Port Said was to have been closed to merchant shipping after 1 April, and the civilian population is to be evacu- ated from the city in the course 25X125X1 of this month, The Israelis claim that the recent artillery exchanges along the canal were triggered by Cairo's realization that Israel was quietly completing a heavy fortification system that would drastically limit Egypt's military options. The Israelis say the barrages were ineffective, that their bunkers are about complete, and that the Egyptians now have to contend with a well-fortified Israeli front line. Israeli mili- tary leaders have warned that heavier "retaliation" might occur once the bunkers were finished., The effectiveness of the Israeli defense was demonstrated in recent incidents in which the Israelis suffered only minor casualties during a week of in- tense shelling. The Israelis also claim that their own artil- lery fire was extremely accurate, and an Egyptian official recently acknowledged that Egypt suffered over $100 million in damage--pri- marily to the oil refineries--as a result of the exchanges. Israel this week for the first time made an air strike against the Jordanian port town of Aqaba following a fedayeen-in- stigated rocket attack on the Israeli port town of Elat on the opposite shore. Jordan, in a Sort of unwritten agreement with Israel, has tried to head off fedayeen activity in this important port area to prevent such an attack. This time, however, the Israelis claim they had no warning, and they moved precipitately to in- voke their aggressive policy of "active defense" in retaliation. SECRET Page 16 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 20?LiMett CIA-RDP79-00927A007000040001-2 Iran-Iraq Iranian military forces have been building up along the Shatt al-Arab River during the past two weeks in response to Iraq's attempts to enforce its rights to the waters that sep- arate the two countries. The Iranian Navy has been put on alert, as have units of the army, and over 1,500 elite gen- darmerie forces have been sent to the border area. General Oveisi, gendarmerie commander and Iran's top military trouble- shooter, has been supervising the operation. The trouble stems from Iraqi harassment of Iranian fishermen and a decision by Iraq to search all ships entering the river flying the Iranian flag. Since 1937, the Iranians have chafed under a British-imposed treaty that placed most of the river under Iraqi control, and they are sensitive to attempts to interfere with their free use of the waters. Nevertheless, the current buildup is not ex- pected to lead to open hostili- ties. Syria In Damascus, the military- dominated Baathist regime has apparently once again managed to meld competing factions within the party into an uneasy coalition. The new leaders of the Syrian Baath party were announced on 31 March, with the leadership about equally divided between the two major party factions--one led by Defense Minister Hafiz Asad and the other by military leader Salah Jadid. The unusual length of the party congress in- dicates considerable dissension among the party ranks during the meetings. Hafiz Asad has held the up- per hand since late February, but was probably anxious to reach some sort of compromise arrange- ment with his opponents to enable the party to present a united front to the public. Asad presumably remains in control, 25X1 but infighting will inevitably continue despite this latest com- promise. EGYPT'S OIL REFINERY COMPLEX AT SUEZ HARD HIT For the second time in less than two years, Israel has dis- rupted the oil economy of Egypt. The shelling of the oil refinery complex at Suez last month has reduced Cairo's domestic refining capacity from 545,000 tons of products a month to only 145,000 tons, or about one quarter of Egypt's domestic requirements. As an interim supply measure, Cairo has concluded an agreement with the British Petroleum Com- pany (BP) under which some Egyp- tian crude oil from the Murgan field,, normally processed at Suez, will be shipped to the company's refinery at Aden for processing. The agreement, which is for one year, calls for BP to SECRET Page 17 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007 p1 -RDP79-00927AO07000040001-2 Israeli-controlled areas following June 1967 hostilities .01 T'ERR: N'E`_ N S Y R I A / *Damascus ,GOLAN HEIGHTS Haifa. -' 1 ''.Ytrrnuk R. ISRAEL) SECRET rat laid \1' AI Arts Al Qantarah Canal Israeli shelling disrupts oil Egyptian oil economy pipeline Cairo S SINAI refinery Murgan A ,17i.141, Egypt shipping crude oil to BP refinery in Aden Hurghada "~L3 j J O R D A N 1 EiafiJ Aqaba SAUDI A R A B I A -Lq'Sharm ash- Sh,lykh Murgan to Aden l apprbx, 1,400 miles 25X1 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007 q3 JA-RDP79-00927AO07000040001-2 supply 200,000 tons of refined products per month. This quan- tity represents about one half of the products. provided by the Suez refineries immediately prior to the shelling and about one third of Egypt's total demand. Several tankers of crude oil al- ready have been dispatched to Aden. Egypt made a similar arrange- ment with BP in November 1967 following damage to the Suez re- fineries by Israeli shelling, but it was then on a month-to-month basis. By mid-1968, the refin- eries had been restored suffi- ciently to discontinue that ar- rangement with BP. The length of the new agree- ment with BP suggests that dam- age from the March shelling is more extensive than in 1967 and that the Egyptians may not in- tend to restore the complex in the near future. In addition to storage tanks and process equipment, the marine loading facilities and the refinery elec- tric power plant as well as the fertilizer plant and the cement plant adjacent to the refineries reportedly were damaged, and a small Egyptian tanker was sunk in the harbor basin. Estimates of damages vary as high as $100 mil- lion. Continued sniping in the vi- cinity of Suez may impede the move- ment of products from Aden to Suez. In early April, however, a Greek-flag tanker reportedly unloaded fuel oil without inci- dent at the damaged jetty at Suez for delivery to Cairo via the pipeline. No Egyptian tank- ers have yet appeared at Suez. The Egyptians are establish- ing temporary anchorage and un- loading facilities south of Suez and a short pipeline to connect with the Suez-Cairo pipeline. They may be planning to use this alter- nate discharge point to avoid possible Israeli harassment of Egyptian tankers returning from Egypt still will have to im- port an additional 230,000 tons of petroleum products a month to meet the level of demand exist- ing p:cior to the recent shelling. There are indications that Egypt is making approaches to inter- national suppliers for bulk pur- chases of kerosene and fuel oil. Stocks on hand are not known, but preliminary estimates suggest that acute shortages of these two prod- ucts may occur in a matter of weeks. The physical limitations on import facilities at Alexandria as well as on the pipeline south to Tanta--about 50 miles north of Cairo--probably would pro- hibit the import through Alexan- dria of the quantity of additional petroleum products necessary to offset the loss of the Suez re- fineries. SECRET Page 19 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 200; Lp~# ' 1A-RDP79-00927AO07000040001-2 SOVIET PRESIDENT VISITS ALGERIA AND MOROCCO Soviet President Podgorny's visits to Algeria and Morocco testify to the growing influence of the Soviet Union in the west- ern Mediterranean. The Soviets apparently see no need--or pros- pects--for expanding their influ- ence in Tunisia and so declined a Tunisian invitation to Podgorny on the grounds that the Tunisian press has been hostile toward So- viet policy. On the surface, Podgorny's visit to Algeria--from 26 March to 1 April--went smoothly, cli- maxing a series of high-level So- viet visits during the past year. Soviet Defense Minister Grechko spent ten days visiting the Al- gerian armed forces last summer; last month, Algerian Foreign Min- ister Bouteflika went to Moscow, where the two sides agreed to set up a permanent commission to ad- minister their increased economic, scientific, and technical cooper- ation. This activity can be ex- pected to increase and will prob- ably be accompanied by an expan- sion of the Soviet presence in Algeria, which already includes nearly 4,000 civilian and mili- tary technicians and advisers. The Podgorny party, report- edly encountered a few obstacles, however. It pressed hard for a public stand by the Algerians in support of the Soviet position on Czechoslovakia and for Algerian recognition of East Germany. The Algerians, whose press has pre- sented only the Soviet position on Czechoslovakia and who have long had close ties with East Ger- many but do not recognize it, de- murred on both requests. Early in the visit, Algeria's President Boumediene delivered a speech calling for the "removal of all forms of foreign military presence" in the Mediterranean, These remarks reportedly irritated the Soviets, who presumably have no plans to cut back on their own activities and are content simply to denounce the presence of the US Sixth Fleet. The Algerians unsuccessfully pressed for an uncompromising $o- viet stand in support of the liber- ation of Palestine. The Soviets, however, agreed in principle to the Algerian request to cease sup- port for and contact with the il- legal Algerian Communist Party, a commitment that the Algerian' plan to test shortly. Podgorny's trip to Morocco was one more sign of the gradual warming of Soviet-Moroccan rela- tions. In the past year, Rabat had agreed to a Soviet naval visit to Casablanca and to the opening of a Soviet consulate there. the two sides signed a five-year trade agreement last July and, during Podgorny's stay, announced the'es- tablishment of Soviet-Moroccan friendship organizations in both nations and a commission to adXnin- ister their economic and techni- cal agreements. Moreover, Pod- gorny's arrival on 1 April was to have coincided with the scheduled beginning of Aeroflot service between Rabat and Havana, a route Moscow has been trying to acquire for more than two years. The Moroccans gave Podgorny a correct and colorful reception. His arrival was given sparse pub- SECRET Page 20 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2O[WRa'I'CIA-RDP79-00927AO07000040001-2 licity, however, and was over- shadowed by the signature of the accord associating Morocco with the European Economic Community. Before the visit, moreover, the King had pointedly dedicated the dam that the Soviets are building in the south, and did not include this or any other Soviet project in the schedule. Podgorny's response to the King's welcoming speech, while apparently bland and superficially correct, contained some elements to give the Moroccan regime pause. For instance, his stress on the people-to-people aspect of So- viet-Moroccan relations implies an effort to appeal to the Moroc- can people over the head of the monarchy. Also, his suggestion that Morocco follow the Soviet pattern has no appeal for a Moroc- can king bent on preserving his own unchallenged authority. Podgorny's farewell state- ment seemed designed to mask areas of disagreement with respect to VietnELm, the Mediterranean, and to some extent the Middle East crisis. A divergence of politi- cal views on these subjects, how- ever, does not preclude Soviet- Moroccan cooperation in economic, scientific, cultural and perhaps even military fields. 25X1 SECRET Page 21 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 200g,f?F EgIA-RDP79-00927A007000040001-2 COUNCIL SHAKE-UP COMPLICATES GHANA'S POLITICAL SITUATION The abrupt removal last week of General Joseph Ankrah as head of the governing National Libera- tion Council has left Ghana's body politic in a state of shock and has lowered public confidence in the pro-Western, military-police regime. Although no changes are expected in the government's basic policies, the shake-up seems likely to cause a fundamental shift in the power relationships within the council and could pro- duce developments that would de- lay the transfer of power to a civilian government. The decision to oust Ankrah came after his colleagues dis- covered he had solicited money from local and foreign business- men for political purposes in con- travention of the ban on political activity. His successor, agreed on only after the senior army of- ficer on the council refused the chairmanship, is young and mer- curial Brigadier Akwasi A. Afrifa. Whether the council retains the cohesiveness necessary for an orderly transfer of power to a civilian government will depend in large measure on the ability of council vice chairman John Harlley to keep Afrifa on an even emotional keel. Harlley, who is also national police chief, has played the role of kingmaker on the council. The power and in- fluence of the dynamic Afrifa, a member of a royal family of the Ashanti tribe, could mount in short order, however. Afrifa is already being cul- tivated by politicians of the Ashanti-dominated political group- ing that long opposed Nkrumah. They view Afrifa's rise to chief of state as having improved the political fortunes of their party, and they are likely to encourage him to chart a course independent of Harlley, who favors a rival political faction. The play of these forces could have an ad- verse effect on meeting the Sep- tember target date for return to civilian rule. The council still insists it will meet the deadline, however, and Afrifa, in his first public action, has announced that the ban on political activity will be lifted on 1 May. Ministerial portfolios have also been exten- sively reshuffled in an effort to give the regime a new public image. Senior army officers are vocally upset over the leadership change. They resent Afrifa's brashness and his rapid rise in rank. Many believe that the senior army officer on the coun- cil should be made chairman and that the military should have greater representation on the council. Some, especially An- krah's fellow tribesmen, suspect the ouster was engineered by Harl- ley for tribal and political reasons. Press reaction to Ankrah's dismissal has been varied, with privately owned media calling for a thorough probe, an action that could implicate other prom- inent Ghanaians in the scandal. SECRET Page 2 2 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 200114-RDP79-00927A007000040001-2 The decision by the US to defer economic sanctions against Peru for its expropriation of the International Petroleum Company was the main topic of conversation in the hemisphere this week. Most Latin American leaders have expressed pleasure and relief over the deferral. The foreign minister of Colombia and an adviser to Brazi, s foreign minister, however, commented that the postponement would be interpreted throughout Latin America as a sign of weakness on the part of the US. In other developments, the Caldera government in Venezuela is taking a more pragmatic approach to foreign relations than did its recent predeces- sors. On 7 April, diplomatic relations were re-established with Peru, marking the first deviation from the ten-year-old Betancourt Doctrine of nonrecogni- tion of governments that come to power unconstitutionally. The move sets the stage for recognizing the military governments of Argentina and Panama, perhaps this week. The government is also pushing ahead with negotiations to establish or re-establish relations with the USSR and some of the Eastern European states. The 1970 presidential election in the Dominican Republic is already occupying political center stage, there, and early jockeying for the nomina- tions points to an extended period of unrest. The latest prospective nominee is ambassador to the US, Garcia-Godoy, prov;;sional president in 1965 and, probably the most popular candidate the left could put forward. Garcia- Godoy will be seeking to undercut President Balaguer, who has also made a veiled appeal to the public to support a national movement for his own re-election. The candidate of the far right is Wessin y Wessin, the leader of the regular military during the 1965 revolt. The "expert-level" meeting of the Special Committee for Latin Ameri- can Economic Coordination ended on 7 April. In a joint communique, the delegates declared their determination to achieve a "Latin American person- ality" with its own values and criteria. A second "expert-level" meeting will be held from 7-14 May, followed by a ministerial session from 15 to 17 May, probably in Vina del Mar, Chile. SECRET Page 2 3 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 200 MMIA-RDP79-00927A007000040001-2 PANAMANIAN NATIONAL GUARD EXTENDS ITS CONTROL Six months after seizing power, Panama's National Guard leadership is showing an inten- tion to remain in active control of the country for a long time to come, regardless of any elec- tions that may be held. A communique issued by the presidential press office, appar- ently at the behest of top guard officials, asserted that govern- ment institutions will remain under the "patriotic protection" of the military--a euphemism for establishment of the guard's power to sit in judgment on the actions of any regime. The National Guard is stead- ily expanding its propaganda ef- fort to demonstrate its popular origins and to generate some sup- port outside its ranks. The guard portrays itself increasingly as being composed almost entirely of men from the lower classes. Guard commandant Torrijos has received extensive coverage in the controlled press, which ex- tolls his virtues and publicizes his activities. During a recent tour of the western provinces, General Torrijos was pictured surrounded by "enthusiastic" peasants as he sought support from rural groups. A spate of new actions by the government junta shows a trend toward greater subordina- tion of government components to National Guard influence. The National Department of In- vestigations (DENI), Panama's small civilian police unit, has been formally placed under the. direct administration of the SECRET Page 24 WEEKLY SUMMARY Panamanian Women Athletes Publicize Their Sponsor at a Recent Sports Event 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 20073//GAra-RDP79-00927A007000040001-2 guard. Although formerly respon- sible to the president, DENI has actually been under the supervi- sion of aguard officer since the ouster of Arnulfo Arias last Oc- tober. The junta has also ap- pointed four new supreme court judges whose chief recommendation is sympathy for government poli- cies rather than personal ability. In addition, a cabinet decree des- ignating 11 October as "National Guard Day" now officially com- memorates the occasion of the guard take-over. some signs of normalcy never- theless are appearing. Business conditions appear to be stabili- zing and economic activity has increased. Despite the lack of any independent evidence of popu- lar support for the regime, no organized opposition has yet emerged, and promises of elec- tions next year remain vague. Torrijos' most immediate chal- lenge is the possible reopening this month of secondary schools and next month of the university, both chronic centers of agita- tion. UNCERTAINTY PREVAILS IN PERU The deferral of US economic sanctions under the Hickenlooper amendment pending further negoti- ations on the International Petro- leum Company (IPC) has stimulated increasing uncertainty in Peruvian economic and political circles. The initial reaction in Peru and throughout the hemisphere was one of relief, but Peruvian Govern- ment leaders are concerned that badly needed credit will be with- held and that foreign investors will defer action until a final decision is reached. Prior to the announcement, a Lima newspaper expressed this concern when it said that the extension of the time limit would be almost as bad for Peru as application of the sanctions. Another newspaper stated that "six more months like the last six" would be harmful for the Peruvian economy and would para- lyze the greater part of expected investments. 'US mining companies had been planning large expenditures for the development of new conces- sions before the expropriation of IPC. These as well as other foreign business ventures in Peru have been held up pending a final settlement of the IPC issue, which now is entering an administrative phase that can last until 6 Au- gust. Leaders of other Latin Ameri- can countries expressed pleasure and relief over the announcement that the sanctions had been de- ferred. Foreign Minister Lopez Michelsen of Colombia, however, reportedly said that the postpone- ment would be interpreted through- out Latin America as a sign of weakness on the part of the US Government. This sentiment was SECRET Page 2 5 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927A007000040001-2 Approved For Release 2007/Rlf(6RDP79-00927A007000040001-2 echoed by an adviser of the Bra- zilian foreign minister, who said that now other countries will think they can act with impunity in defying the US. President Velasco has publicly termed the deferment of the sanc- tions a "Peruvian triumph," but the "triumph" was not sufficient to make him a national hero or to strengthen his position sig- nificantly. F_ I SECRET Page 26 WEEKLY SUMMARY 11 Apr 69 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 ~~~r v9d For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2 Secret Approved For Release 2007/03/06 : CIA-RDP79-00927AO07000040001-2