WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A010200040001-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 28
• Document Creation Date: December 21, 2016
• Document Release Date: November 14, 2007
• Sequence Number: 1
• Publication Date: April 13, 1973
• Content Type: SUMMARY

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DIRECTORATE OF
INTELLIGENCE
S~cret
WEEKLY SUMMARY
DOS, DIA, NAVY reviews completed
Secret
13 April 1973
No. 0365/73
Copy N2 so
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iopments of the week through noon on Thursday.
EE.KL,Y SUMMARY, issued every Friday morning by
of Economic Research, the Office of Strategic
+on;s:ents.
25X1
1, and We Directorate of Science and Technology.
aed separately as Special Reports are listed in the
CONTENTS (13Aprit'1973)
I China: A Certain Distance
2 Argentina: Terrorist Challenge
2 Arabs-Israel: Trouncing the Fedayeen
n Cambodia: Sihanouk Resurfaces
t, Vietnam
6 Laos
MIDDLE EAST
AFRICA
France: The New Team
Malta: In the Web
Denmark: Back to Work
USSR: East and West
USSR: Soviet Navy Stirring
Yugoslavia: Defense Doctrine Recast
Bulgaria: Room at the Top
International Money
Doing Business With Romania
Italy: The Fragile Margin
17 Sikkim: Political Upheaval
18 Kuwait-Iraq: Stalemate
18 Rhodesia: Groping
20 South Asia: Faint Hopes
20 Pakistan: New Constitution
21 Turkey: Finally a President
21 Cyprus: Makarios vs Grivas
WESTERN
HEMISPHERE
22 Panama: Vox Populi
22 Chile: A Truce
23 Venezuela: Energy Resources
24 Peru: Moderates on the Move
f
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A CERTAIN DISTANCE
Chinese economic and political u
continue. The current s
Si
m
r
no-Vietna
ese
m litary
aid pact almost certainly runs through the end of
1973, and there are signs that aid under this pact
istheconautintuumingn.~illtand should be up for renegotiation in
, further hints about Peking's
course almost certainly should be available before
then. )
1f [There are other signs that Peking is rethink-
ing the military aid question. Sihanouk recently
claimed that Chou En-Iai had declared that no
new Chinese military assistance to the Khmer
insurgents will ho
A reement flatly h?k,.k:* "II n9 because the Pari
JA "commentato
r article in the party daily
of 7 April-the first article since early January to
use this authoritative by-tine-charged that the US
was using its Power "to negotiate with an inten-
tion of dividing and provoking the socialist coun-
tries." This formulation, with its implicit criticism
of Chinese and Soviet attitudes toward big-power
detente, has not appeared in the North Vietnam-
ese media since last August when Hanoi was
under heavy pressure from its big patrons to be
forthcoming at the Paris talks.]
1 1In any approaches to the North Vietnamese
do this matter
Chines
,
e attitudes would con-
ditioned by their ap
rai
l
b
p
sa
of prospects or
So iet
mili tar aid to Hanoi and US sup ort for Sal-
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Chou En-lai
[Public and private Chinese statements since
the cease-fire in Vietnam underline Peking's desire
to see it removed as a major issue in big-power
Politics. Not only are the Chinese taking a relaxed
and positive attitude toward the situation, but
they may lso be using their influence with Hanoi
to this end?
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\The army and police forces have launched a
counter-offensive against the radical leftists who
have terrorized Argentina with a rash of bomb-
ings, murders, and kidnapings in the past few
weeks. The Peronists, who are still trying to pla-
cate the terrorists with the promise of amnesty
for political prisoners, are be inning to doubt that
they will have much success
[The security forces arrested several sus-
pected terrorists and confiscated arms and subver-
sive propaganda in a series of raids and searches of
homes and automobiles beginning on 10 April.
They failed, however, to turn up any of the
so-called "people's prisons," where at least 25
kidnap victims so far this year have been held for
periods ranging from a few days to several weeks.
\T--wo recent kidnap victims-a retired Argen-
tine admiral and a British businessman-are still
being held. Earlier this week a US business execu-
tive was released from ca tivit
ment and have claimed that it would cease if they
won the election. In public, President-elect
Campora has continued to take a conciliatory line
in the apparent hope that terrorists will lay down
their arms in exchange for amnesty. He has called
on the terrorists to observe a "truce" to let him
prove that he "is on the right path."]
If the terrorism continues, the most likely
effect will be to make the Peronists more depen-
dent on the military and thereby strengthen the
hand of armed forces leaders in the next govern-
ment. Working togetherl the Peronists and the
military might be quite effective against the vari-
ous terrorist organizations. In their years out of
power, the Peronists have occasionally worked
with and claim to have penetrated most of the
The violence is finally beginning to worry
the Peronists. They have long blamed terrorism
on the repressive tactics of the military govern-
Page 2
currently active organizations.
Arabs-Israel
TROUNCING THE FEDAYEEN
!0 In the early morning of 10 April an Israeli
para-commando company carried out a three-
hour operation against the fedayeen in Lebanon,
hitting seven targets in Beirut itself and one in
Sidon. This time the Israelis sought out and killed
three top fedayeen leaders. In addition, the Is-
raelis blew up an apartment belonging to the
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WEEKLY SUMMARY 13 Apr 73
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Popular Democratic Front for the Liberation of
Palestine. They attacked two weapons workshops,
the reputed headquarters for Fatah operations in
the Gaza Strip, and a vehicle repair shop at Sidon.
As was the case in the raid against seven guerrilla
targets north of Tripoli, Lebanon, on 20 Feb-
ruary, the commandos were transported by patrol
the fedayeen have no alternative. Nevertheless,
the raid must have had a chilling effect on feda-
yeen morale, and restrictions imposed by Leba-
non and Syria have severely limited their capa-
bility to strike directly at the Israelis in cross-
border operations..
boats and put ashore and brought out in rubber
dinghies; helicopters were used to evacuate the 13 SFor the moment, Fatah leader Yasir Arafat
casualties.) is trying to exploit sympathy for the fedayeen
1-k dead.IAAs part of this effort, the fedayeen com-
1' /The deputy chief of Israeli military intelli- mand charged that the US collaborated with the
gence, Brigadier General Shalev, said that the Israelis in staging the strike and that the US
strike was "part of Israel's policy of hitting those Embassy in Beirut is harboring members of the
responsible for international terrorism." He said I Israeli assault team.J)'Several mass protests against
the raid was not in direct response to the feda- the US were organizedyand there were threats of
yeen attempts against the Israeli ambassador and fedayeen terrorist action against the US Embassy
the El Al aircraft in Cyprus and obviously had itself.j
been planned much earlier
/ f JChief of Staff Lieutenant General Elazar un-
derscored the Israeli view that most terrorist plots
are hatched in Lebanon, where terrorists have
"complete freedom.'j(Since the slayings of one
Belgian and two American diplomats in Khar-
toum on 2 March, Palestine guerrillas have killed
an Israeli leather merchant in Nicosia who they
claimed was an Israeli spy. There have also been a
growing number of fedayeen-inspired incidents on
the Israeli-Lebanon border, including one in
which two Arabs and one Druse on a hunting
party were killed by a mine. There has also been
an increase in guerrilla activity in the Gaza Strip,
and several explosions in Israel itself. The sub-
sequent arrests of a number of guerrilla suspects
in the occupied west bank indicate the raid was
successful in its intelligence gathering aspects]
The Lebanese Government has been shaken
severely. Prime Minister Salam submitted his
resignation, apparently because President Fran-
jiyah would not agree to dismiss the army
commander for what Salam regarded as negli-
gence. Salam seems to want to dissociate himself
from the government and to preserve his standing
with the Muslim community. His resignation has
not yet been accepted, but Franjiyah is said to be
considering the formation of a government of
"national union," presumably including more
leftist, pro-Palestinian sympathizers.'
commenting on the fedayeen actions in Nicosia,
has publicly warned the Arabs and Israelis not to
extend their conflict to Cyprus. Criminal charges
have been brought against the terr rists, but it is
(,~ not clear whether they will be tried(rhe organiza-
iThe precision of the Israeli action in Leba- tional affiliation of the terrorists as not been
non stunned the Palestinians. When the fedayeen
leaders re er, they will turn to the problem of
Zretaliation (The deaths of three senior Fatah offi-
cials, inclu ing a leading Black September figure
and the destruction of installations, are not crip-
pling losses. As with previous Israeli raids, the one
this week will not affect the guerrillas' commit-
ment to international terrorism. As they see it,
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After being out of the public eye for almost
two months, Prince Sihanouk is back in his favor-
ite position-the limelight. The former Cam-
bodian leader reappeared in Hanoi late last week
professing to have just returned from an extensive
tour of the "liberated zone" in Cambodia. The
attention that Sihanouk received in the North
Vietnamese capital, including strong support for
his claim as Cambodia's "legitimate" chief of
state, is the clearest indication to date that Hanoi
is willing to endorse Sihanouk's return to a posi-
tion of power in his homeland. jT
[.The North Vietnamese apparently calculate
that the deteriorating situation inside Cambodia
improves the chances that negotiations with
Sihanouk will eventually prove acceptable to
Phnom Penh. Even if such negotiations prove
impossible, the new emphasis helps convey an
impression of Khmer Communist unity and legiti-
macy.)
Sihanouk contends that he now enjoys the
unreserved allegiance of the Khmer Communists
in Cambodia and is entitled to speak and act for
them. He lost little time in assuming this role,
asserting that the indigenous Communists had
asked him to tell the world that they would never
accept any settlement or cease-fire with the Lon
Nol government. Sihanouk indicated that his trip
had reduced political frictions within the anti-
government forces via a "marriage" of non-
Communist and Communist factions. He made it
clear, however, that he expects the Communists
to dominate any future government in Cambodia.
\On the military side, Sihanouk stressed that
his "army" is an "independent" force, now total-
ing 120,000 "effectives"-an obvious exaggera-
tion. Despite this boasting, he played down the
possibility of a direct assault on Phnom Penh,
claiming that, because of US air support, it would
be better to wait for the Lon Nol government to
collapse of its own weight. Asserting that military
deliveries from Peking were stopping, Sihanouk
claimed that the Khmer Communists had already
been given enough materiel to allow them to keep
fighting until 1975.1
Nearly Out of Gas
(Phnom Penh almost literally ran out of gas
early in the week, but a major fuel emergency was
avoided when four petroleum tankers braved
Communist shellfire and moved up the Mekong
from South Vietnam to the capital. They de-
livered about a week's supply of gasoline and
other POL products. The tankers were part of an
18-vessel resupply convoy. Four other ships from
the convoy carried general cargo. The remaining
nine, including five tankers, did not get through.
One was sunk. If the remnants of the convoy are
not able to run the Mekong gauntlet within a
week, Phnom Penh's petroleum reserves will again
be dangerously low.j
The River and the Roads
Most of the fire directed against the convoy
came on the South Vietnam side of the border.
On the Cambodian side, the security situation
along the Mekong has improved. Government
troops have regained control over sizable stretches
of the river's banks north of Neak Luong. With
the aid of air support, they have also cleared all
but two sections of Route 1 between Phnom
Penh and Neak Luong. In the southwest, the
Cambodians reopened a section of Route 4 north
of the port of Kompong Som on 9 April without
meeting any resistance:]
r
j ,'The government's situation along Route 2
south of Phnom Penh has deteriorated. Khmer
Communist units have kept up their harassment
of Cambodian positions in the vicinity of Takeo,
as well as their shellings of the isolated provincial
capital. A few miles west of Takeo, the Com-
munists pushed government forces out of the
town of Angtassom-a serious setback which sub-
stantially increases the threat to Takeo. Route 5,
Phnom Penh's rice line to the northwest, remains
closed between Oudong and Komponp Chh-
nang.
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StL;Kt I
The ICCS Shootdown level since the cease-fire went into effect last
,j ?- January] (Shells are still falling on some govern-
IThe ICCS contingent in South Vietnam suf- ment positions, however, especially in forward
fered its first fatalities on 7 April, when one of its. bases near Viet Cong areas
helicopters was shot down near Khe Sanh in thW
Communist-held part of Quang Tri Province. The
aircraft, one of two on a flight to a designated
Communist resupply point, was hit by a small
surface-to-air missile. All aboard-one Indonesian,
one Canadian, two Hungarians, two Viet Cong,
two Americans, and a Filipino-were killed.1
The helicopter was in an area the North
Vietnamese are turning into a major military base.
Regret has been expressed in Communist propa-
ganda output
I__.,- At the same time, the Communists have
done their best to shift the blame for the incident
to the ICCS. They tried to persuade the crew and
passengers from the second Commission heli-
copter, which landed safely a mile or so from
where the first crashed, that both aircraft were far
off course:jrCommunist media have taken up the
same theme, charging that the aircraft was lost
because its "US crewmen did not adhere to the
established itinerary." T Actually, a Viet Cong
v--'-.5official was navigating, and the pilots of the
second helicopter sa they are sure the aircraft
were right on course.)
,?; IICCS inspection efforts in Communist-con-
trolled areas are sure to be inhibited, at least for a
time, and those who question the value of the
whole supervisory operation under the present
cease-fire guidelines will become a bit more cyni-
cal.f7Moreover, even though Communist members
of ICCS local teams are angered by the Viet
Cong's handling of the incident, they apparently
will not be allowed to lean very hard on the
Vietnamese Communists4
The Military Situation
lin the northern provinces, ground fighting in
some areas during the past week was at the lowest
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-- iln the southern provinces, the Communists
are maintaining their pressure on the isolated
Tonle Cham ranger camp. The Communists have
the capability to overrun Tonle Cham, but appar-
ently hope to starve out the defenders, who have
only a few days' supply of food and ammunition.
Efforts to-arrange a truce in the area have borne
no fruit. ]+,The South Vietnamese military com-
mander in the region, General Minh, views the
situation around the camp as a crucial test of
ICCS effectiveness, and sees the ability, or in-
ability, of the ICCS to investigate the fighting as
setting a precedent.0Another possible test of ICCS
effectiveness could be shaping up near the pro-
vincial capital of Phuoc Long northeast of Tonle
Cham, where Minh believes the threat of a new
Communist assault is "very serious."j
of defense, and finance; the portfolios for public
works, foreign affairs, and information will go to
the Communists. Bargaining continues over the
interior ministry. Posts of lesser importance will
be divided evenly between the two sides. Vien-
tiane will appoint the number-two man in each
ministry headed by a Communist, and the Com-
munists have the same right in reQand to the
ministries headed by the government. )
(Despite the progress on political issues,
formidable obstacles remain. The Communists are
maintaining a hard line on military matters, and
this could block the formation of a new gov-
ernment for some time)TSpecifically, the Commu-
.nists demand a formal demarcation of the zones
of control, a prohibition on the integration of
irregulars into the Lao Army, the dismantling of
irregular bases such as Long Tieng, the abandon-
ment of enclaves such as Bouam Long, and a
severely circumscribed role for both the Lao
There have been sharp skirmishes in several . ?Commissionj (The Communists almost certainly
delta provinces at points close to Communist base intend to give way on some of these demands as
areas or entry points. Dinh Tuong Province has the talks progress, but at the moment they are
had considerable fighting, and the Communists showing no signs of yielding.
have managed to scare much of the population
out of the western delta town of Hong Ngu-an
ICCS border entry checkpoint. Some of the fight-
ing is intended to divert government attention
from the infiltration of supplies and men, but
much of it suggests that the Communists are bent
on eliminating remaining South Vietnamese
troops in these areas.
LAOS: PASSING OUT PORTFOLIOS
)Although the two sides remain far apart on
many issues, Communist and government nego-
tiators this week reached tentative agreement on
the make-up of a new coalition cabinet. Under
the agreement, Vientiane will retain the ministries
Long Tieng Area
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;Pyongyang has always hoped that its dia-
logue with Seoul would lead to the termination of
the UN's role in Korea and an acceleration of US
military withdrawal. Seoul, however, not only
retains UN support but has recently received
strong reassurances of continued US backing.
Frustrated by these developments, Pyongyang is
appealing directly to foreign governments in an
effort to stir greater support for its position
;Its message is an old one, with some new
twists. Speaking before the Supreme People's
Assembly on 6 April, Premier Kim 11-song decried
the presence of US forces as the major obstacle to
progress in the North-South talks.j',He said that
Pyongyang was ready to reduce its armed forces
by 200,000 men if the US withdrew its 40,000
troops. This was a departure from Pyongyang's
previous proposals which have tied any reduction
in its forces to cutbacks in the larger South
Korean forcesij Kim called for the abolition of the
UN Command and the United Nations Commis-
sion on the Unification and Rehabilitation of
Korea and insisted that North Korea be allowed
to attend the discussion of the Korean situation
at the UN General Assembly this fall.
These themes were repeated in letters sent to
various governments. One addressed to the US
Congress did not contain the specific offer to
reduce forces; it did warn that the US presence
and continuing military support for the South
Koreans increased the possibility of conflict on
the peninsula;
The North Koreans probably realize that
their offer of troop reductions will not be taken
seriously, but, by appearing to be flexible in talks
with the South, Pyongyang may hope to increase
international support for its position. The North
Koreans may believe that direct appeals to the US
will complicate relations between Seoul and
Washington..`
More specifically, North Korea's campaign is
designed to undercut Seoul's contention that
there should be no consideration of the Korean
issue at the UN this fall lest it jeopardize progress
in the talks. Both in public speeches and in the
private high-level talks with Seoul last month, the
North Koreans have warned that there will be no
progress in the talks until there is some agreement
on military matters. In the absence of such prog-
ress, Pyongyang and its allies can be expected to
lobby strongly for consideration of the Korean
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The cabinet appointed on 5 April shows
certain ,changes in President Pompidou's ap-
proach, which reflect his stronger personal posi-
tion after the legislative election last month. Over
half of the 22 cabinet positions went to Gaullists;
but for the first time in the Fifth Republic only
one Gaullist "baron" figures in the government,
and the exception is a close friend of the Pres-
ident. Pompidou's own men hold the major posts.
The new line-up does not foreshadow a sharp
move away from the basic tenets of Gaullism to
which Pompidou is committed. It does suggest
that the President will be better able to react
pragmatically to events than he could when
orthodox Gaullists were stronger in the gov-
ernment.
(,Michel Jobert, formerly the head of the pres-
idential staff, is the new foreign minister, replac-
ing Maurice Schumann who lost his assembly seat
in the election. Jobert is one of Pompidou's
closest working associates and a foreign affairs
specialist. Robert Galley, a technocrat and strong
Gaullist replaces a hard-line Gaullist, Michel
Debre, at the Defense Ministry.)
The Independent Republicans, the Gaullists'
major partner, increased their strength vis-a-vis
the Gaullists in the election, but gained only one
additional cabinet post. Giscard d'Estaing, their
leader, retained the Ministry of Economics and
Finance. Pompidou reportedly has suggested that
the Gaullists and Independent Republicans be-
come more unified and has singled out Giscard
for special praise. Pompidou may be trying in this
way to dilute arch-Gaullist influence, but the flat-
tering attention given Giscard will raise specula-
tion that an heir is being drawn forward.]
~A \The removal of Debre, along with some of
the other cabinet changes, is aimed at convincing
the voters that Pompidou is responsive to
demands for change. Creation of a new ministry
for administrative reform is another signal] IThe
new government has announced plans for social
reforms, including changes in the controversial
draft law, increases in the minimum wage, and
more flexibility in retirement programs. It has
also proposed redrawing the boundaries of elec-
tion districts and shortening the presidential term
from seven to five years.}
Arch-Gaullist Prime Minister Messmer was
reappointed, though his tenure may be short.
Messmer has served only since last July, and Pom-
pidou may plan to retain him for several months
as a face-saving device. Conspicuous by his ab-
sence from the government is Jean Lecanuet,
head of the centrist faction that cooperated with
the government in the last round of the legislative
race. Lecanuet declined Pompidou's offer of a
post. Lecanuet may be waiting to see if Pompidou
acts on reforms and may be watching to see if
Messmer is replaced soon. He probably also wants
to be free to regain control over the centrists who
split with him over cooperation with the govern-
ment.
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MALTA: IN THE WEB
`) '!While Prime Minister Mintoff chips away at
the complicated problem of NATO payments for
the use of naval facilities in Malta, domestic prob-
lems are piling up on the island. Unemployment is
acute, inflation is zooming, and discontent has
cropped up among the Labor government's reg-
ular supporters. Mintoff's government has not
really faced up to these serious problems.]
complaints from the labor force, which custom-
arily provides him solid support. In an effort to
soothe disgruntled dry dock workers, Mintoff
signed an agreement providing for pensions, a
reduction of the work week, and a cost-of-living
bonus. He refused to grant wage increases and
insisted that economic sacrifice will be necessary;
this is likely to irritate the impatient workers. 7
EOn the base payments issue, Mintoff, who - /An estimated 8.5 percent of the work force
has never really sought to create an atmosphere of is unemployed. In an effort to reduce the ranks of
cooperation, is caught by fluctuating exchange 4' the unemployed, Mintoff has established the
rates. There are disagreements over the special' Pioneer Corps, a paramilitary unit that will con-
payments provision of the base agreement by- centrate on public works projects. Measures such
which NATO countries are compensating Malta as this and the concessions granted to port
for losses caused by the sterling float last June. workers merely poke at the edges of the eco-
These have been made worse by the dollar deval- f-7 nomic problems facing the island.Jtf the Maltese
uation and the decision by other countries to economy is to recover, Mintoff must address him-
float their currencies. He has been pressing for
advance guarantees of exact amounts to be paid
and assurances about the level of future payments
for the duration of the agreement. He has not yet
received them.
(, )On the domestic front, Mintoff's public
pronouncements of a rosy future created high
expectations and have led to bitter disappoint-
ment as promises fail to materialize. He is getting
Empty Dry Dock
self to inflation and to economic growth. Without
a positive business climate to stimulate new
investments an economic turnaround is unlikely
to develops T
[If he does not get the economy moving, his
political future will be threatened. As disillusion-
ment with Mintoff grows, the Labor Party is
losing popularity. So far, the rival Nationalist
Party, which suffers from disorganization and the
absence of an articulate leader, has not been able
to put together an effective challenge to Mint-
DENMARK: BACK TO WORK
'r J~ [Workers and employers this week accepted a
settlement to end a nationwide strike that had
idled some 260,000 workers for nearly three
weeks. The employers' federation ended by acqui-
escing in an agreement similar to the one it re-
jected earlier, apparently reasoning that it was
better than a government-imposed settlement. I
percent loss in production.
3 ' [Other European labor organizations had
,,pledged support to the Danish workers, and the
/employers may have felt that further recalcitrance
would only hurt Danish industry. The price for
two years of labor peace was a 7.5-percent in-
crease in wages and benefits and a reduction in
man hours that may result in a two- to three-
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[Moscow recently has picked up a few new
endorsements of party chief Brezhnev's four-
year-old proposal for "an Asian collective security
system." In the communique issued at the end of
Premier Kosygin's visit to Iran in mid-March, the
Shah agreed to work for the realization of such a
system. Subsequently, in an interview in Pravda,
Japanese Foreign Minister Ohira said that Japan
would be willing to exchange views with any
country interested in the idea. The Soviets are
using these statements in their own effort to
enlist more Asian support for the concept, but
they almost certainly realize that the idea will not
become a reality soon.1
because the USSR is now publicly on record that
the system is not aimed against China.
i j jfhe Soviets are under no illusions that the
recent endorsements will bring Brezhnev's scheme
closer to fruition. A senior Foreign Ministry offi-
cial this month noted some of the hurdles to be
overcome first: a European security arrangement,
a solution to the Arab-Israeli conflict, and nor-
malization of relations between India, Pakistan,
and Bangladesh. What has happened is that the
Asian collective security system proposal is now
firmly a part of Moscow's diplomatic effort to
increase its acceptability in Asia. 1
lBrezhnev introduced the proposal in 1969 to President Podgorny and Premier Kosygin
+_ake advantage of Asian concerns about China were in Finlaod and Sweden, respectively, last
and the announced US plan to withdraw mili-/f /'week and appear to have scored modest successes.
tarily from Indochina. The proposal was purpose-4' Still both were upstaged in the Soviet press by
fully left vague so that it would appeal to the reporting on plans for party chief Brezhnev's visit
largest possible number of Asian countries. Mos- to West Germany next month.)
cow's chief aim was not actually to create such a A
system, but rather to remind Asians of the USSR tWhile Podgorny attended ceremonies in Hel-
and its security interests when Asians were pre-(,,t'sinki marking the 25th anniversary of the Finno-
occupied with their shifting relations with China b Soviet Friendship Treaty, Foreign Minister Kar-
and the US.1 1,+1 jalainen represented Finland at the similar cele-
bration in Moscow. Lesser demonstrations of Fin-
~In early 1972 after the Indo-Pakistani war, land's close ties to the USSR included a Soviet
the Soviets undertook new demarches on behalf Week in Finnish schools and a large Soviet scien-
of Brezhnev's proposal. Brezhnev at that time tific exposition in Helsinki that will run until 15
listed the "principles" on which such a system April. Finnish President Kekkonen's anniversary
should be based: speech was obsequious, especially on the sensitive
issue of the Winter War of 1939-40, and has
garnered stinging criticism in Finland and
Sweden. 1
i; 1 ,During Podgorny's visit, Helsinki announced
that it will sign the Finnish-CEMA economic co-
? recognition of the inviolability of bor- ;' operation agreement, something Moscow has long
ders, advocated. Nothing was said, in public at least,
about the proposed free-trade agreement between
? the development of mutually advanta- Finland and the EC. Podgorny did confer with
genus bilateral ties. Kekkonen in private for several hours, and a key
topic presumably was the Soviet attitude on this
These are so anodyne that they give governments problem. Soviet reservations about the EC ar-
like Japan and Iran little difficulty, particularly rangement undoubtedly have not lessened.'
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litical and economic questions.
one. Both sides expect it will result in some
progress toward the resolution of outstanding po-
tion to come to West Germany. The visit, a first
for a top Soviet leader, is tentatively set for 12-17
May. it will be 25X1
a "working visa rather than a state or official 25X1
fter a normal winter lull, the Soviet Navy is
~~11 Kosygin's Uncomfortable Press Conference
Alf in Sweden, demonstrations by Jews and Bal-
tic emigres and an awkward press conference se-
verely damaged Kosygin's hopes of scoring a pub-
lic relations success. He had smoother going in his
political talks with Prime Minister Palme. The
resulting joint communique was bland and
avoided explicit criticism of the US. The eco-
nomic talks produced no substantial accord. The
Swedes complained about the recent sharp drop
in Soviet imports of Swedish goods, but the So-
viets claimed that inadequate Swedish credits
were at fault. The parties agreed to open negotia-
tions next month on Soviet uranium enrichment
services for Sweden.)
]} [Pravda for two days running gave less play to
the Nordic sojourns than to plans for Brezhnev's
{n"~ travel. On 5 April, Chancellor Brandt formally
announced that Brezhnev had accepted his invita-
7 [Activity in the western Mediterranean in-
dIved the helicopter-carrier Moskva and other
currdntly engaging in a variety of exercise, sur-
veillance, and relief operations. An anti-carrier
defense exercise is being staged in the Norwegian
Sea. A surface force, led by a Sverdlov-class
cruiser, is simulating a carrier force and serving as
a surveillance target for Soviet naval aircraft.
Except in 1972, the Soviets have conducted
similar exercises in the Norwegian Sea for a num-
ber of years. Last fall, US-NATO participants in
exercise "Strong Express" were treated as aggres-
sors by Soviet aircraft performing reconnaissance
and simulated air-to-surface missile attacks./
units in a series of anti-carrier and anti-submarine
exercises. This activity coincided with the arrival
of the initial contingent of submarine relief units
from the Northern Fleet. Five F-class diesel at-
tack submarines and one J-class cruise missile unit
entered the Mediterranean submerged in an appar-
ent attempt to avoid detection. The Soviet
Mediterranean Squadron will doubtless monitor a
US amphibious exercise that begins on Sardinia
on 13 April.I
7 [in the Far East, units of the Pacific Fleet are
also engaging in spring exercises. Fourteen surface
combatants in the Northern Sea of Japan were
noted conducting operations on 11 April.
(A turnover of ships on the West Africa pa-
'rol also is taking place. An Alligator landing ship 25X1
arrived in the vicinity of Conakry, Guinea, on 9
April, relieving a destroyer that had been on sta-
tion since November 1972.
25X1
I
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'The party presidium's new ideological jour-
nal, Socijalizm , has recently stated the case for
flexibility in forming wartime alliances and for
closer party control of the military-1,The journal
opened new ground when it admitted that Yugo-
slavia would consider military alliances if attacked
and that emergency alliances with capitalist coun-
tries are permissible)
is a likely candidate for the axe. Last December
he made veiled threats against Vienna over the
problem of the Slovene minority in Austria.
Socijalizm 's complete rejection of "all thoughts
of aggressive acts, threats, or pressures against
other states" is thus an indirect slap at the de-
fense minister.
,Such an admission has long been inhibited BULGARIA: ROOM AT THE TOP
by Tito's doctrinaire opposition to alliances of
any kind. Heretofore, the party line held to the On 7 April, 44-year-old Dimitur Stoyanov
dreamy view that the UN, nonaligned friends, and was appointed minister of interior. He joined a
"other progressive forces" would come to the growing number of young leaders who have been
rescue if Yugoslavia were attacked. The absence""., moved into prominent jobs in the aging Bulgarian
of any substantial effort to save the Czecho- hierarchy over the last two years(
slovaks in 1968 destroyed whatever credibility
this theory ever had and created pressures in _ [Since party boss Todor Zhivkov has been
Belgrade for more solid security guarantees:] ailing and been out of sight for six weeks, Stoya-
nov's elevation at this time has sparked rumors of
Even so, Tito refused to budge for almost-,-; some dark Balkan intrigue. For the moment, how-
five years. He has lately been trying to improve
relations with the Soviet Union and thereby re-
duce the threat from the East. The Socijalizm
article serves to remind the party elite that Brezh-
nev's doctrine of "limited sovereignty" could still
pose a danger to Yugoslavia. The article, in effect,
is a signal that Tito and his colleagues are taking
due account of the Soviet threat and that they are
looking into Yugoslavia's options. Socijalizm does
emphasize that nonalignment is the best policy
for normal times, because formal peacetime alli-
ances restrict national sovereignty and frequently,
prove useless in a real emergency.
ever, the change seems to be nothing more than a
recognition in Sofia that age is catching up with
the Bulgarian old guard. Most of its members are
now in their late sixties and seventies, and Zhiv-
kov, himself 62, is well aware of the need to
groom replacements. After the sudden death of
Foreign Minister Ivan Bashev, Zhivkov turned to
Petur Mladenov, at 36 the youngest foreign minis-
ter in Eurdpe. i
lln the party, Ivan Abadziev's star is rising.
At 42, he has already been entrusted with a
number of delicate assignments, including the
thankless task of attempting to patch up party
the Yugoslav military was put on notice' ties with the Yugoslavs. Abadziev now appears
that its internal role of defending the state against strong enough to challenge Boris Velchev, the
domestic enemies is "disappearing"-an admoni- current number-two man, for the title of Zhiv-
tion designed to persuade the generals to stay out kov's heir-apparent in the party.%
of politics. Tito has generally agreed with critics
in the military that the party had been too soft \Washington will get a firsthand look at one
on nationalists and liberals, and he has used mili- of the new breed when Deputy Trade Minister
tary backing in his purges. Now that he has set Andrei Lukanov leads an economic delegation to
about restoring party supremacy, he does not f'~, the US in late April or early May. At 34, Lukanov
want further military interference. has been assigned the task of promoting Bulgarian
trade with the West. He has already had some
fhe article hinted at personnel changes in success in economic talks with the British.)
25X1
the military hierarchy. Defense Minister Ljubicic
25X1
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The dollar has been relatively strong in inter-
national financial markets in recent weeks, and
the Europeans have had little difficulty in main-
taining their joint float. Since the float was initi-
ated on 19 March, the dollar has risen slightly
against the joint float currencies. Only modest
interventions have been required of European
central banks to maintain the joint float. Activity
on the international money markets has been
sluggish, but the lack of trading indicates hesi-
tancy and uncertainty rather than faith in the
new exchange rates.
The mere existence of the joint float band
serves as an inviting target for money managers
and speculators who have tens of billions of dol-
lars at their disposal. Balance-of-payments trends
will probably produce short-term pressures for
appreciation of the mark and the French franc
and for depreciation of the Scandinavian cur-
rencies, and any unsettling economic or political
news from a country whose currency is involved
in the joint float is a potential source of specula-
tive pressure. Among other currencies, the yen
will be under upward pressure and the Swiss franc
and sterling subject to downward pressure; any
substantial variation from present exchange rates
by any of these currencies also will have a de-
stabilizing effect on the European band. Unless
the Europeans demonstrate a firm determination
to support the band when the pressures increase
and unless provision is made to control the mas-
sive funds available to speculators, a successful
attack on the float is likely, probably before
autumn.
International monetary reform
DOING BUSINESS WITH ROMANIA
7 7 [The signing of Romania's first joint owner-
ship agreement with a US firm and the visit to the
US later this month of a deputy prime minister
highlight the positive trend in US-Romanian eco-
nomic relations. The joint ownership agreement,
involving Control Data Corporation, is the first
time Romania has allowed US ownership to
accompany an infusion of US capital. The joint
venture, to be known as Romcontroldata, will
produce computer equipment. Production will be
supervised by a joint management staff and board
of directors with Control Data holding 45 percent
of the equity. Both partners will be allowed to
market the computer equipment, and this may
indicate that Control Data will not make its most
advanced technology available to the Romanians. 7
' Romania was the first CEMA country to
legislate for Western equity participation, but
until recently was unwilling to follow through
and allow joint ownership. US firms were more
reluctant to enter into cooperative production
ventures without the benefits of ownership and,
eventually, the Romanians, who are much inter-
ested in increasing hard currency earnings, gave
in. Romania is not alone. Hungary has already
enacted a law permitting equity participation, and
Poland is considering such a law. These legal
changes, along with Eastern Europe's quest for
technology and managerial techniques, will con-
tinue to attract US capital under terms more
favorable to US firms.?
Economic relations will undoubtedly be on
2 the agenda when Emil Draganescu, deputy prime
minister and minister of transportation, visits the
layed until major US-European differences over a
number of trade and monetary issues can be re-
solved. Most foreign officials feel that long-range
monetary stability will require increased US
cooperation and a firmer attitude by the Ameri-
cans toward trade and financial imbalances. They
regard the joint float as a satisfactory temporary
expedient but seek a return to a more conven-
tional, if slightly more flexible, international
exchange rate structure.
most-favored-nation status. In the strongest of a
series of public and private signals, the Romanian
press gave front-page coverage to President Ceau-
sescu's comment to a Western journalist that
most-favored-nation status would increase bilat-
eral trade three or fourfold. The Romanians are
interested in offsetting import contracts with bar-
ter deals to minimize hard-currency deficits. Even
if Romania is accorded most-favored-nation treat-
ment it would probably continue to run a trade
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1 !Prime Minister Andreotti, who comes to
Washington next week, faces growing disaffection
at home. His tenure is uncertain. Some of his
colleagues are already talking about a successor
government but hope to postpone decisive action
until June}
!Discipline in the government parties is fee-
ble, and government bills have been faring badly
in parliament. On 11 April Andreotti survived
two votes of confidence by margins of only four.
He has been holding to the view that only his
defeat on a formal vote of confidence would
cause him to resign. This position is contrary to
custom, but it has lengthened Andreotti's stay as
prime minister. Only once, in 1953, has an Italian
goverment been ousted through a vote of no
confidence; usually the fall comes about by party
action outside parliament)
3 Last week, Vice Prime Minister Tanassi's
Social Democratic Party officially invited the
Christian Democratic, Republican, Liberal, and
Socialist parties to separate meetings with the
Social Democrats for preliminary soundings on
how and when to change the government. The
Tanassi initiative is taking hold and some meet-
ings may be held soon. In talking with US of-
ficials, Tanassi has declared that he distrusts the
Socialists, but publicly he has expressed hope for
a return to the center-left formula of 1962-72.
The center-left included Socialists as well as Chris-
tian Democrats, Social Democrats, and Repub-
licans. Business-oriented Liberals replaced the
Socialists in 1972.)
r; \These formal inter-party meetings must
Work out agreements on economic policy and on
relations with the Communists. The Republicans,
Liberals, and Socialists lay particular stress on
economic issues while the Social Democrats
emphasize the Communist question. The Chris-
tian Democrats are deeply concerned with both.)
y (Despite a more pro-business government
orientation during the past year, Italy's economy
is showing few signs of a strong self-sustaining
revival. The present government's program to
stimulate the economy and restore rapid growth
will help boost consumer prices eight percent this
year. Labor-oriented political leaders feel the
program is skewed in favor of business and against
the consumer. The government's failure earlier in
the year to float the lira jointly with other EC
countries is also controversial. The Republicans,
in particular, claim that the Andreotti gov-
ernment is repudiating Italy's long-standing com-
mitment to European unity[
(The Communist issue was played up by both
the Christian Democrats and the Social Demo-
crats in campaigning against the Socialists in par-
liamentary elections last May. Christian Demo-
cratic leaders were responding to pressure from
their own voters who threatened to defect to
right-wing parties. The Christian Democrats now
will be anxious to see the Socialist Party take new
public positions which can be adduced as repre-
senting greater conservatism, even if the changes
are only for appearances. The Social Democrats,
on the other hand, value Socialist loyalty to the
center-left formula in local and regional gov-
ernments as well as in Rome; this would require
the Socialists to forgo good jobs in Communist-
dominated local governments.)
I Even if discussions go smoothly, a change of
government may be delayed. Political leaders
want first to assess the strength of left and right
within the Christian Democratic Party. The
leaders will be able to do this at the party's
congress scheduled for early June; they will not
push for a government change before then, al-
though one may be forced upon them by growing
disaffection.
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J
in this tiny Himalayan kingdom. Weeks of unrest,
culminating in several days of demonstrations, led
this week to negotiations aimed at a compromise
between the 50-year-old chogyal (ruler) and the
opposition, which is dominated by ethnic Nepalis.
SIKKIM: POLITICAL UPHEAVAL
>r Important political changes are taking place
"I J
limited authority. His new role is likely to be
spelled out in a written constitution and a one-
man, one-vote system. The State Council may be
expanded to give the Nepalis representation pro-
portionate to their numbers.
The latter, mostly Hindu, make up 75 percent of ! l ;_~ rBy encouraging more representative govern-
the 200,000 people in this Indian protectorate. ment, New Delhi may create problems for itself.
They are demanding an end to political and eco- ) Nepali youth leaders are committed to ousting
nomic discrimination that favors Sikkim's original 'f-~the chogyal completely and might not be satisfied
inhabitants, the Bhutias and Lepchas, who are. with the political compromise New Delhi has in
Buddhists and culturally oriented toward Tibet 112/mind. In the end, however, India, whose officials
fill key positions in the Sikkimese bureaucracy,
[The current unrest was sparked by elections can be expected to take whatever measures are
last January to the 24-member State Council. The necessary to preserve Indian security interests
Indian pressure, sub-
sequently "requested"
India to take over full
administration of his
kingdom. There were
few casualties, and the
royal family, including
the chogyal's 32-year-
old, American-born
votes were counted, the Nepalis accused the gov-
ernment of rigging the elections, and skirmishes
broke out between the rival communities. Things
quickly got out of hand, and the chogyal had to
ask for Indian assistance. The approximately
30,000 Indian soldiers regularly stationed in Sik-
kim restored order. The chogyal, possibly under
wife, was unharmed/
LA capable Indian
official was sent to
iJ,Gangtok to assume
administrative control.
2 He will also try to
work out a compro-
mise between the ruler
and the Nepalis. The
chogyal will have little
alternative but to ac-
cept an Indian,-dictated
compromise.1Such a
compromise will prob-
ably curtail his already
Delhi is not likely to permit any substantial
change in the 1950 Indo-Sikkim Treaty, which
gives India control over Sikkim's defense, external
affairs, and communications. The Indians are
anxiously looking for Peking's reaction to this
sign of instability on India's northern fron-
The Chogyal (1) In Happier Times
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KUWAIT-IRAQ: STALEMATE
\Three days of direct negotiation brought no
solution to the impasse growing out of Iraq's
seizure on 20 March of a police post on the
Kuwaiti side of the border. Iraqi Foreign Minister
al-Baqi was in Kuwait last weekend, ostensibly to
begin negotiations on a border demarcation, but
he arrived without authorization to conclude a
border agreement or to compromise on Iraq's
demands for Kuwaiti territory. When Kuwait
proved equally unbending, al-Baqi packed up and
went home.;
' aghdad looks deadly serious about retain-
ing control of the area it occupied. The area
overlooks the Iraqi naval base at Umm Qasr.
Baghdad may have withdrawn some forces from
the disputed area, but Kuwaiti forces have not
reoccupied it. Iraq covets the Kuwaiti islands of
al-Warbah and Bubiyan, which are strategically
located on the approach to Umm Qasr4
Kuwait holds that the border runs where a
somewhat vague 1963 bilateral agreement said it
did, and the Kuwaitis are willing only to negotiate
a more specific line. The territory under dispute is
clearly inside Kuwait. The Kuwaitis are somewhat
more flexible on the two islands; they might agree
to lease a part of both, but they will not entertain
any arrangement which permanently cedes the
islands to Iraq.
The dispute thus remains stalemated. Kuwait
may try for another round of direct talks, or
request further mediation by other Arab states, or
appeal to the Arab League for intervention. The
desirability of UN mediation is also being
weighed. Each of these courses, except the last,
has been tried before to no avail, and there is
little reason to expect that further diplomatic
effort will be any more fruitful. The Iraqis con-
tend, in blithe disregard of the 1963 agreement,
that the territory they occupy is rightfully theirs,
and Kuwait is in no position militarily to elect
RHODESIA: GROPING
s+f Prime Minister Smith told the Rhodesian
parliament last week that he would try once more
to settle the seven-year-old dispute with Britain
over Rhodesia's unilateral declaration of inde-
pendence)Although Smith may have an ace up
his sleeve, it is more likely that he is reacting to
economic and political pressures that could be
alleviated by international recognition]
f ej' ]According to Smith, he will seek to convince
the British that most black Rhodesians have come
to accept the provisional agreement negotiated
between London and Salisbury in November
1971. Bishop Muzorewa, whose African National
Council convinced the visiting Pearce Commission
in early 1972 that most black Rhodesians
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7 a
a Kuwait
Mina'al
LAhmadi
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opposed the agreement, declared last week that
the Council still rejects it))Smith may claim that
the Council is no longer as broadly representative
as two other groups, the African Settlement Con-
vention or the Rhodesian Settlement Forum.]
[In London, British officials have professed
surprise at Smith's latest move. They doubt that
he has any basis for asserting that black opinion is
shifting in favor of) the 1971 agreement, which
would put off majority rule for at least 30 years.
Although the Heath government would like to
recognize Rhodesian independence and cancel
economic sanctions, it must consider domestic
opinion to the contrary, as well as the reactions
of such major trading partners as Nigeria. The
British public was aroused against the Smith
regime last week, hen it secretly tried and prison
sentenced Peter Niesewand, a Rhodesian jour-
nalist who has reported for both the BBC and
Reuters.;'
(Nevertheless, Smith may feel that his hand is
being forced by adverse developments in Rho-
desia. The drain on Rhodesian foreign currency
since international sanctions were imposed in
1966 has been aggravated this year by the impact
of a severe drought on agricultural exports and by
the closure of the Zambian border. President
Kaunda's extension of a trade boycott-originally
imposed by Smith in a vain attempt to stop
Zambian support of guerrilla incursions-appar-
ently reduced Smith's influence among white
Rhodesians.)
`7( 4Smith's heaviest political liability appears to
be the cumulative effect of the insurgency that
began last December when some 200 foreign-
trained guerrillas infiltrated from Zambia through
Mozambique and began to raid farms held by
whites. Although no more than a dozen white
civilians, soldiers, and police have died, hundreds
of reservists have been kept on active duty, a
sense of physical insecurity is evident in the white
community, and the capabilities of the security
forces have been questioned in parliament.]
')u [Although the main group of guerrillas-the
Zimbabwe African National Union-has been con-
tained in northeastern Rhodesia, a white farmer
was recently killed 60 miles south of Salisbury,
and two armed terrorists were captured in the
capital itself/
7j ~A settlement with Britain that did not pro-
vide for early majority rule would not stop guer-
rilla activity, but it would at least reduce, if not
eliminate, the impact of international sanctions.
Smith claims that the resulting economic progress
would be shared by Rhodesian blacks and would
make them less susceptible to the militant
minority. This is at least questionable, but an end
to the sanctions surely would ease the financial
bind, facilitate procurement of more materiel for
the security forces, and enable more white farm-
ers to stay on the land-a critical factor in any
counterinsurgency effort.)
J lthough such considerations may push
Smit toward a new accommodation with Lon-
don, there are limits on what he can and will
offer. Recent terrorism may have stiffened the
feeling in the dominant Rhodesian Front that 25X1
white rule must be maintained, and Smith has
always preached that steadfastness would even-
tually bring the British around.
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SOUTH ASIA: FAINT HOPES
;1 Hopes for improved relations among India,
Pakistan, and Bangladesh were given a slight boost
during the week. President Bhutto's victory on
the new constitution should permit him to focus
more attention on foreign relations; he followed
up his victory with a call on his countrymen to
accept the "realities" of the subcontinent and
make an effort to improve relations with their
-1 neighbors] Bhutto recognizes, however, that he
still faces a major task in selling the need for early
recognition of Bangladesh to his countrymen, par-
ticularly the strongly nationalistic Punjabis.)
11r ~A ranking Indian Government official says
that progress toward improved relations among
the three countries is likely "soon." He indicated
that the recent exchange of views between Prime
Minister Gandhi's representative and Prime Minis-
ter Mujib were not as unproductive as pictured in
the press. The Indian said Mujib concentrated on
the need to release Bengali civil servants held in
Pakistan since the war. Mrs. Gandhi's representa-
tive probed Mujib's position on the approxi-
mately 90,000 Pakistani prisoners of war held in
India. Apparently, Mujib did not press his posi-
ion that no movement on the prisoner issue
would be possible until Pakistan formally recog-
nized Bangladesh. Mujib made clear, however,
that he still feels Islamabad must make the first
gesture.
)Mrs. Gandhi has been concerned both over
growing domestic and foreign criticism that India
is violating the Geneva Conventions by continuing
to hold prisoners of war. She also worries about
the costs of maintaining them. Nevertheless,she is
not likely to risk relations with Dacca by using
India's considerable leverage as one of Bangla-
desh's major sources of economic, military, and
technical aid to force Mujib to make major con-
cessions on the prisoners.]
r, v Dne highly emotional issue could scuttle any
early movement toward better relations. Mujib is
publicly committed to holding war crimes trials
for at least some Pakistani prisoners-150-250 has
been suggested as a likely number. He considers it
his moral duty to hold such trials. Bhutto has
repeatedly warned that war crimes trials would
provoke a violent reaction in Pakistan and could
destroy any chance for early recognition of Bang-
PAKISTAN: NEW CONSTITUTION
1