WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A011100070001-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 25
• Document Creation Date: December 21, 2016
• Document Release Date: December 4, 2007
• Sequence Number: 1
• Publication Date: June 27, 1975
• Content Type: SUMMARY

State Dept.
review
completed
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..r
Weekly Summary
DOS review completed
Secret
Secret
No. 0026/75
June 27, 1975
Copy Np
62
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tht- hce iii -,wa- g c
ctorete of cjanct and
u;ring more comprehensive treat
bushed separately as $ec el i teport& are
tS. 25X1
1.
India: Opponents Jailed
2
Laos: A Swan Song for Souvanna?
3
Angola: Another Truce
4
Portugal: Moderates Encouraged
6
Spain: Arias Reaffirms Goals
7
CSCE: Qualified Yes to a Summit
8
Greece: A New President
8
Romania-Portugal: Friendship Treaty
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MIDDLE EAST
AFRICA
1.2
Mozambique: Independence Arrives
13
Israel: Focus on the Sinai
WESTERN
HEMISPHERE
14
Venezuela: Political Stalemate
15
Latin American Communism:
16
Meeting in Havana
Peru: Succession Once Again
EAST ASIA
PACIFIC
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2q
Papua New Guinea: Independence at Last
CONTENTS (June 27, 1975)
ree week through fWof on i,nw S day. i
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India: 1-3
Opponents Jailed
Prime Minister Gandhi, who has been
under increasing pressure from her opponents to
resign since her recent conviction for corrupt
electoral practices in 1971, struck back on June
26 by having scores of opposition leaders ar-
rested. A presidential proclamation of national
emergency followed, giving the government
wide new powers.
In a brief radio address, Mrs. Gandhi cited
the threat of internal disturbances as the reason
for the proclamation. The arrests were made
under the provisions of the Maintenance of
Internal Security Act, the language of which will
prevent those arrested from seeking court action
to obtain their release.
Government critic J. P. Narayan, the aging
one-time associate of Mahatma Gandhi in the
independence struggle and leader of a national
non-partisan protest movement, was among
those jailed, as were at least two members of
Mrs. Gandhi's own Congress Party who had
urged her to resign. All newspaper reporting on
internal developments was brought under
censorship, and the editor of at least one opposi-
tion newspaper was arrested. The radio in India
has long been fully under government control.
The Prime Minister's vigorous action came
two days after a ruling by a Supreme Court
justice that granted Mrs. Gandhi only a condi-
tional stay of the judgment against her by a
state court on June 12. That judgment, if it
stands, will disbar her from holding public office
for six years. The conditional stay allows her to
retain the prime ministership but denies her the
right to vote in parliament until the Supreme
Court acts on her appeal. With parliament in
recess, the restriction is academic, but the ruling
further damaged Mrs. Gandhi's political posi-
tion, which had also been hurt by her party's
unexpected defeat in legislative elections in the
state of Gujarat in early June.
Sensing that they might have Mrs. Gandhi
on the run, opposition leaders intensified their
campaign to force her to step down. Their
attempts to arouse the public reached a climax
in a speech by Narayan in New Delhi on June 25
in which he called on the army, police, and
government employees to disobey any order
they considered illegal. A nationwide "non-
violent struggle" to force Mrs. Gandhi to resign
was to have been launched by the combined
opposition parties on June 29.
Much will now depend on the leaders of
the ruling Congress Party. The cabinet, including
the two members most often mentioned as pos-
sible successors to Mrs. Gandhi-Minister of
Agriculture. Jagjivan Ram and Minister of
Finance Y. B. Chavan-is still giving her strong
public support. Even before the events of June
26, however, a small group within the Con-
gress-perhaps 25 of the 515 members of
parliament-was reported insisting on Mrs.
Gandhi's resignation, and others may now take
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SECRET
up the call. Her demonstrated willingness to
take strong action in order to stay in power will
give pause to some, however.
Senior officers within the armed services
apparently were taken by surprise by the proc-
lamation of emergency. The Indian military has
a long tradition of remaining aloof from politics
and probably will not interfere in the present
situation other than to assist the police in main-
taining order, if ordered to do so.
Mrs. Gandhi will probably not convene
parliament in July for its traditional summer
session. Under the terms of the Indian constitu-
tion, however, she must seek parliament's
approval of the emergency proclamation within
two months of its date of issuance or the proc-
lamation automatically expires. The Supreme
Court is expected to begin a review of Mrs.
Gandhi's appeal shortly after it reconvenes on
July 14, and a judgment might be issued before
the expiration of the two month period. The
executive branch of the government, despite
extensive powers granted it under the new
emergency proclamation, cannot block the
Supreme Court's consideration of the appeal.
41b Laos: A Swan Song for Souvanna?
There are unconfirmed reports that Prime
Minister Souvanna Phouma may be planning to
turn over leadership of the coalition government
to his half-brother, Prince Souphanouvong, the
nominal chief of the Lao communist movement.
National Political Council, succeeding to the
prime ministership is also plausible. The so-
called "Red Prince" has long been considered
Souvanna's heir apparent, and he enjoys a na-
tional following second only to that of
Souvanna.
Souvanna reportedly plans to accompany the
King only as far as Paris, with the King and his
royal entourage continuing on to Moscow,
Peking, and Hanoi for official state visits.
Recent press reports from Vientiane have also
mentioned the possibility of a midsummer trip
abroad by Souvanna and the King.
The reports of Souvanna's impending
retirement from active political life are plausi-
ble. The coalition government is now dominated
by the Lao communists, leaving Souvanna a
virtually powerless figurehead. Moreover, the
Prime Minister is nearly 74 years old and his
health is failing; these physical factors alone
argue strongly for retirement. It is unclear
whether Souvanna plans to go into permanent
political exile in France or return to the retire-
ment home he has built in the royal Lao capital
of Luang Prabang.
The notion of Souphanouvong, currently
serving as chairman of the coalition's Joint
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President Kenyatta (1), Holden Roberto (r), and Jonas Savimbi, (second from right) at recent negotiations in Kenya
(7
Angola: Another Truce
The leaders of the three rival liberation
groups in Angola's transitional government
signed a new coexistence agreement last week,
after six days of talks in Kenya. It is intended to
forestall all-out civil war and to preserve the
transitional regime until the country gains
independence next November. Its effectiveness
is questionable, however, inasmuch as the new
accord is little more than a restatement of
earlier agreements that the liberation groups
have failed to honor. Elements of the two major
groups engaged in sporadic skirmishing even
while their leaders were meeting, and new fight-
ing erupted in Luanda, Angola's capital, on June
24.
The three leaders-Holden Roberto,
Agostinho Neto, and Jonas Savimbi-agreed to
release prisoners held by their respective organi-
zations-the National Front for the Liberation
of Angola, the Popular Movement for the Liber-
ation of Angola, and the National Union for the
Total Independence of Angola. They also agreed
to disarm the civilian population and to speed
up the formation of a national army composed
of troops from the three groups. In addition,
they reaffirmed their commitment to hold na-
tional elections to a constituent assembly by the
end of October. The assembly is to select a head
of government who will assume office on
independence day, November 11.
Effective implementation of the truce rests
on the slim chance that Roberto's group and
U
Neto's organization-the main antagonists-will
refrain from further attacks on each other. The
most recent wave of fighting between them left
the Popular Movement in control in several areas
north of Luanda, severely limiting the National
Front's access to the city. The Popular Move-
ment's advantage could spark Roberto into call-
ing for further military action before being cut
off entirely from the city.
A weakness in the agreement itself is its
provision for the ministries of information and
justice to lead the campaign to disarm civilians.
Both these ministries are controlled by the
Popular Movement, the group most responsible
for having armed civilians. These armed civilians
have proved a valuable auxiliary for the Popular
Movement in areas where its regular military
force has been outnumbered by troops of the
National Front. If the Popular Movement hesi-
tates to move quickly to disarm civilians,
Roberto might try to force the issue with his
own troops.
The leaders also agreed to guarantee the
right of political activity for all three groups
throughout the territory. The National Front
and the Popular Movement, however, have
established unchallenged control over areas in
which they have tribal links, and any future
political activity in those areas by a rival group
is virtually certain to provoke serious fighting.
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 PORTUGAL: MODERATES ENCOURAGED
Moderate political parties in Portugal are
seeking to ensure that the momentum generated
by the moderate tone of the policy statement
issued by the ruling Revolutionary Council on
June 21 continues in their favor.
The Council's statement was a hard-fought
compromise resulting from eight days of deliber-
ations. The effect on the fortunes of political
moderates may be more far reaching than the
wording of the communique indicates. The
Revolutionary Council reaffirmed its commit-
ment to political parties and to the establish-
ment of a pluralistic system. At the same time,
however, it reiterated support for the formation
of grassroots organizations tied to the Armed
Forces Movement that will be the "embryo of
an experimental system of direct democracy."
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Socialist Party demonstration in support of the Revolutionary Council's policy statement
Page
4 WEEKLY SUMMARY Jun 27, 75
The Council judges Portugal to be in a
transitional phase of its revolutionary process,
with political parties necessary to help educate
the population. The statement does not project
the parties' future role, but conceivably this
may be diminished in subsequent states in the
building of a "classless society," if popular com-
mittees are created according to the Movement's
wishes.
Moderates are particularly encouraged by
the harsh treatment of radical left-wing groups
that threatened public order during the past few
days. The Council promised to take strong ac-
tions against extremists and did so, the day the
statement was released, by breaking up a group
protesting the jailing of several members last
month. The Council also assured the existence
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of non-socialist opposition parties-like the
right-of-center Social Democratic Center-as
long as they support the Movement's goal of
constructing a socialist society.
The decision to support the existence of
political parties should temporarily silence those
radical officers who have supported popular
councils formed by the far left and who have
proposed abolishing parties as well as the con-
stituent assembly. A list of "recommendations"
favoring a "speeded up revolutionary process"
was formally presented to the Revolutionary
Council last month, pushed by elements of the
internal security forces, led by security chief
Otelo de Carvalho.
The security troops have grown in-
creasingly independent and, although the ma-
jority is probably not radical, the minority has
openly taken sides in theRepublica dispute. The
troops allowed Communist workers to enter the
newspaper offices and denied access to the
Socialist management, despite the announced
government policy to treat both sides equally.
Last week they were also reluctant to protect
from extremist attack Catholic demonstrators
demanding that the church-owned radio station
be turned back to its legal owners.
The policy statement rebuked the security
troops by prohibiting all partisan political activ-
ity by the military. Reports of possible attempts
by radical elements to oust moderates and as-
sume control over the Movement have probably
been discouraged by the moderates' show of
strength in the Revolutionary Council. Rumors
of Carvalho's impending dismissal, however,
have been repudiated by the Council's affirma-
tion of his promotion to commander of the
internal security forces, a position that had been
officially held by President Costa Gomes.
The communique, while acknowledging
economic problems and administrative lethargy,
did not address itself to concrete issues like the
Republica and Radio Renascenca disputes.
Soon after the general policy statement
was issued, the Council resumed meeting to
1
tackle the conflicts in the media. The Revolu-
tionary Council's communique did state that the
Movement intends to exert greater control over
the media and will take over at least one news-
paper to ensure accurate coverage of its policies.
The Council also gave the coalition government
until the end of July to propose an economic
strategy that would reverse the decline in pro-
duction and the increase in unemployment.
The moderates hope that forthcoming solu-
tions on these matters will be in their favor. To
help maintain the advantage they have gained,
moderate parties, led by the Socialists,
responded enthusiastically to the communique
and organized a demonstration on June 23 to
show that they can mobilize the population in
support of the Movement as effectively as the
Communists.
Socialist and Catholic leaders have begun
to line up external support for their causes in a
further attempt to influence the Movement. The
offer of economic assistance made by various
West European countries and organizations is
contingent upon the survival of political parties
in Portugal and apparently served to strengthen
the arguments of moderates last week in the
Revolutionary Council. A major portion of the
Council's statement dealt with economic prob-
lems, and Movement members appear to be
aware that the best hope of help lies in Western
Europe.
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SPAIN: ARIAS REAFFIRMS GOALS
In a major policy speech to the Spanish
parliament on June 24, Prime Minister Arias
reiterated his determination to follow through
on the liberalization program he announced
shortly after his appointment 18 months ago
and promised new measures to increase popular
participation in government. He came down
hardest, however, on the need for law and order
as a prerequisite for orderly political develop-
ment. On balance, conservatives will find the
views expressed by Arias more to their liking
than will the liberals, but neither group will be
fully satisfied.
Arias defended his program as a basis for
creating a national consensus under the monar-
chy of Prince Juan Carlos, Franco's designated
heir. Arias' praise of the Prince exceeded his
references to Franco, whom he treated almost as
if he were already a figure of history. He shed
no light on when the transfer of power would
take place, however. The extensive praise for
Juan Carlos may also have been intended as a
slap at the Prince's exiled father, Don Juan of
Borbon, who recently renewed his claim to the
throne.
The Prime Minister pointed to the out-
lawed Communist Party as the greatest obstacle
to a smooth transition after Franco goes. Arias
announced that before the end of the year, he
would send to the parliament a special draft law
on combating communism. The law will prob-
ably lead to harsher police action against the
Communists and their allies in the underground
trade union movement and in the Communist-
dominated Democratic Junta, which was formed
in Paris last July and now operates clandestinely
in Spain.
Arias also condemned separatist move-
ments, especially those in the troubled northern
Basque provinces. He defended the state of
emergency with its added police powers that
was imposed on two Basque provinces on April
25 and gave no indication when the emergency
decree would be lifted. On a conciliatory note,
he promised that his government will propose
regional development plans that could meet
some of the grievances of the separatists.
The Prime Minister singled out the armed
forces for special praise, noting their stability,
moderation, and acceptance of responsibility to
guarantee the protection of the present institu-
tions of government and order. He also credited
the armed forces for exercising "prudence and
courage" in the Sahara by not giving in to
provocations and threats-his only reference to
foreign affairs in the entire speech.
Arias rejected the call of radicals for a new
constitution, saying reforms can be made by
amending the present basic laws. He referred
again to improved prospects for greater popular
participation in government through creation of
political associations. Admitting that the project
had aroused opposition, Arias announced he
would remove some restrictions on political
associations and will permit them to participate
in the parliamentary election this fall. The
impact of this measure is blunted, however, by
the fact that only one fifth of the 565 members
are elected directly.
Arias also cited the appointment last week
of Jose Solis Ruiz as minister-secretary general
of the National Movement as a boost for associa-
tionism. Solis, Arias noted, was one of the orig-
inal advocates of associations. Despite his posi-
tive remarks about Solis, the Prime Minister is
probably still unhappy about the appointment.
Solis, an ambitious politician who has been men-
tioned as a future prime minister, reportedly
was appointed by Franco against Arias' wish.
1-he Prime Minister dealt only briefly with
Spain's serious economic and labor problems,
promising major tax reforms and citing the re-
cently adopted right-to-strike law as evidence of
the government's concern with labor. Arias
avoided any mention of such current issues as
the conflict with the church on political and
social policies, university problems, youth, and
censorship-all of which he discussed in some
detail in his maiden speech in February
1974.
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CSCE: QUALIFIED YES TO A SUMMIT 12-1,50
The question of whether the European
security conference will be capped by a summit-
level finale in July remains unanswered. Soviet
party leader Brezhnev last week sent letters to
the heads of major Western countries proposing
that the summit be held in Helsinki on July 22.
The foreign ministers of the EC Nine responded
on June 24 with a very qualified "yes." They
stated that it is "desirable and possible" to hold
the summit at the end of July-if a number of
outstanding issues can be resolved quickly.
In the past month, Soviet concessions have
made it possible for many substantive problems
to be resolved, particularly those concerning
increased East-West contacts and exchanges of
information. This week, the Western and Soviet
delegations agreed on a clause protecting Allied
rights in Germany and Berlin, another point of
contention. The representatives of the neutral
states must still concur with the text, but it is
likely that they will do so.
There are still several other major issues yet
to be resolved, including military-related con-
fidence-building measures-particularly one
dealing with advance notification of military
maneuvers-and the type and frequency of fol-
low-on meetings to the conference. The West
Europeans have insisted that these problems
must be resolved before they give final agree-
ment to the summit. They believe that Mos-
cow's desire to have a summit in July will lead
the Soviets to make concessions.
The issue of providing advance notice of
maneuvers will likely be resolved by com-
promise. The East and West will probably split
their differences on how much advance notice
must be provided and on the size and location
of the maneuvers that will be affected.
port a Danish proposal calling for senior officials
to meet in the second half of 1977 to assess how
the conference's decisions have been imple-
mented. A preparatory meeting could be held
two months earlier. In addition, the EC states
agree that there can be ad hoc meetings of
experts, provided there is a consensus among the
participants to convene such meetings.
The Soviets apparently want fairly fre-
quent meetings, in which all aspects of detente
and the state of bilateral and multilateral re-
lations are examined. At the same time, how-
ever, Moscow does not want to be held ac-
countable for implementation of the con-
ference's decisions. The Soviets also hope to
obtain an eventual commitment to another, full-
scale European security conference. The con-
ferees are trying to reach a compromise, but
resolving differences may prove difficult and
time-consuming.
THE EC FOREIGN MINISTERS SAID IT
IS "DESIRABLE AND POSSIBLE" TO
HOLD THE SUMMIT AT THE END OF
JULY IF A NUMBER OF OUTSTANDING
ISSUES CAN BE RESOLVED QUICKLY.
Another possible stumbling block to a July
summit is the Turkish demand that the Turkish
Cypriot community be represented in the
Cypriot delegation to the summit and Ankara's
objections to the presence of President Makarios
at Helsinki. Western delegates seriously doubt
that Makarios can be persuaded to absent him-
self from the summit and are hoping that the
parties concerned can work out a solution.
The Finns have let it be known that they
will require four weeks' advance notice to com-
plete preparations for a summit meeting. If
there is to be a summit in July, the delegates in
Geneva will be under the gun to resolve the
East and West, however, are far apart con-
cerning follow-on meetings. The EC Nine sup-
outstanding issues within a few days.
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Karamanlis and Tsatsos (r)
GREECE: A NEW PRESIDENT
chief of state, with Tsatsos being little more
than a figurehead. It is generally believed that
Karamanlis will move up to the presidency in a
year or two, by which time internal and external
pressures on the government may subside.
Karamanlis's decision not to opt for the pres-
idency now probably stems in part from fear
that controversy over a successor as prime min-
ister might split his New Democracy party. The
constitution also provides that the prime min-
ister serve as party head, and Karamanlis is prob-
ably unwilling at this point to give up day-to-
day control of party affairs.
Only four New Democracy deputies
flouted party discipline and cast ballots for the
opposition candidate, former prime minister
Kanellopoulos, who is not connected with a
political party. Papandreou's Panhellenic Social-
ist Movement and one wing of the Communist
Party cast blank ballots to protest the sweeping
powers of the presidency under the new con-
stitution.
Should Tsatsos eventually step down from
the presidency as expected, Karamanlis will
probably then be elected to a full five-year term
as president. The opposition charges that this
scheme would permit Karamanlis to maintain
control of the government, even if his party lost
the parliamentary election in 1978.
Constantine Tsatsos was elected president
of Greece last week by a parliamentary vote of
210 to 65. He was Prime Minister Karamanlis'
hand-picked candidate and the principal archi-
tect of the new constitution.
Tsatsos, a respected academician, is not
expected to challenge Karamanlis' leadership. A
long-time associate, he is particularly indebted
to Karamanlis, who as prime minister in the
early 1960s brought Tsatsos back into his cab-
inet. Tsatsos had been out of the government
for a year because of his involvement in a scan-
dal over alleged improper awarding of govern-
ment contracts.
The new constitution creates a strong pres-
idency and was tailor-made for Karamanlis. He
will exercise most of the powers granted to the
Page
Romania-Portugal
FRIENDSHIP TREATY n ~? ?j 3
The signing of the Portuguese-Romanian
friendship treaty-the first between a NATO and
a Warsaw Pact country-culminates a year of
rapidly improving relations between Lisbon and
Bucharest. Romania is now markedly ahead of
its Warsaw Pact allies in developing ties with
Portugal.
The 13-article document was the most
dramatic result of the visit of Portuguese Pres-
ident Costa Gomes to Bucharest from June 13
to 16, The treaty stresses national independ-
ence, sovereignty, and the similarities between
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the policies of the signatories and the non-
aligned world. It also bears a striking resem-
blance to a treaty signed by Bucharest and
Pyongyang in late May, when North Korean
party boss Kim 11-song visited Romania.
Romanian President Ceausescu heralded
the treaty as "the first of its kind between
friendly countries that belong to different mili-
tary blocs." Although Ceausescu and Costa
Gomes criticized the concept and existence of
military blocs, Ceausescu counseled moderation.
He avoided mention of the Portuguese Com-
munist Party in public. Romania has con-
sistently sought closer ties to the Portuguese
socialists in preference to the Soviet-oriented
Portuguese Communist Party.
The communique summarizing the visit
points out that both Portugal and Romania are
developing nations. It stresses the need to over-
come the gap between the developed and devel-
oping nations and the Third World theme of
establishing a new political and economic order
in international relations. The communique also
indicates that the two sides signed several trade,
economic, and technical-scientific agreements
and decided to establish a joint commission to
expand economic and industrial cooperation.
Military contacts between Lisbon and
Bucharest also continue to expand. Colonel-
General Coman, the Romanian chief of staff,
visited Portugal from June 17 to 23. Coman's
trip came four months after General Fabiao, his
Portuguese counterpart, visited Romania.
Fabiao later spoke enthusiastically about his trip
and praised the civic action role of the Roma-
nian army in society.
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USSR-EASTERN EUROPE: GRAIN PROSPECTS
USSR
Because of drought in parts of the USSR's
spring grain area
this '
,
years grain crop will
probably reach only 215 million tons. This is 5
million tons less than earlier forecasts, but still 5
million tons above Soviet needs. Large' purchases
of foreign grain may not be necessary this year, Growi pean USSR g conditions in most of the Euro-
the major winter grain area-have
been good to excellent. The harvest there, which
is just beginning, will cover 30 million hectares.
Barring unexpected difficulties, some 70 million
tons of grain should be brought in, 6.5 million
tons more than the record in 1973.
Record yields are likely in parts of the
eastern New Lands area and western Siberia,
where moisture levels are better than normal. In
the Volga Valley, southern Urals, western
Kazakhstan, and Kustanay, however, soil mois
ture is critically low, and yields in these areas
will be three fourths of the long-term average.
A good spring grain harvest still seems
likely. About 100
grain, i About million hectares of spring
9 4 million hectares of corn, will
be harvested this year. Despite dr
parts of the spring grain area d conditions io
be above avers e; ' the Yields are likely to
145 million tons, assuming the drought breaks
A total grain crop of 215 million tons will
probably exceed the USSR's requirements.
Nevertheless, Moscow may million tons of grain for delliiverya n the next
fiscal year to cover shortfalls in corn for live-
stock and in high-quality milling wheat.
Most buying will
probably be done in the
summer and early fall. Grain prices should be
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attractive in the coming months, a result of a
bumper US crop and generally good crop con-
ditions throughout the world. The Soviets have
not bought any grain this year, but deliveries
continue under old contracts. Soviet grain
imports in the current fiscal year will probably
total 6.5 million tons.
A large grain crop this year may result in
substantial storage losses because of the severe
strain on overloaded storage facilities. The
Soviets are making a major effort to increase
closed grain storage; a massive construction
program is under way to raise storage capacity
by 40 million tons by 1980. This means the
Soviets will have to add 8 million tons a year,
more than double the annual rate between 1971
and 1975.
In mid-1974, the Soviet ministry of pro-
curement reported it had off-farm storage facili-
ties for 126 million tons of grain, of which only
28 million tons were in grain elevators. Farms
have the capacity for storing an estimated 100
million tons. The construction program will rely
primarily on prefabricated concrete silos,
though metal silos will be included on a signifi-
cant scale for the first time. The Soviets will
probably purchase some equipment or designs
from abroad.
Major losses during recent years have been
caused by storing newly harvested grain in huge
outdoor piles. Grain with a moisture content of
14 to 15 percent can usually be stored safely, as
long as temperatures remain below 40 to 50
degrees Fahrenheit. In certain regions of the
USSR, however, freshly harvested grain may
contain 25 to 35 percent moisture. If this
moisture is not reduced by drying, the grain
becomes moldy and deteriorates.
Eastern Europe
Grain production in Eastern Europe-
excluding Yugoslavia-could reach 80 million
tons this year, compared with 75 million in
1974, provided the weather is favorable during
the rest of the growing season and harvest. This
level of output still would require grain imports
of 8 million tons, only 5 percent less than last
year.
Bulgaria, Hungary, and Romania-the grain
exporters in Eastern Europe-will account for
the jump in output. Spring rains relieved
drought conditions in both Bulgaria and Ro-
mania. On a visit to Bulgaria in late May, Under-
secretary of Agriculture Campbell observed that
the important winter wheat crop was in excel-
lent condition, but that the corn had been
planted late or was stunted by cool weather.
Soil moisture level is still low in Bulgaria, and
normal summer rainfall is needed to maximize
crop yield.
Crops in Romania, on the other hand, need
hotter, dryer weather to speed development.
Good crop conditions notwithstanding, it is un-
likely that Bucharest's ambitious harvest tar-
get-20 million tons-will be met. In 1972, Ro-
mania harvested some 17 million tons of grain
from roughly the same amount of planted area.
Wheat and corn production in Hungary will
probably match last year's, with a reduction in
the area planted offset by higher yields. The
production of barley and other grains will in-
crease.
Grain production in Czechoslovakia, East
Germany, and Poland will approach the record
harvest of last year. Because of heavy rains last
fall, 500,000 to 600,000 hectares normally
sown to winter wheat had to be sown with
lower yielding spring grains. Only East Germany
fulfilled its fall sowing plan. April rains slowed
spring planting in Czechoslovakia, but no major
problems were reported by East Germany or
Poland. To boost production levels, meadows,
pastures, and other marginal land were sown
with spring grains, mainly barley.
Bulgaria, Hungary, and Romania will ex-
port most of their increase in output, with the
remainder going to replenish drought-depleted
stocks. Czechoslovakia, East Germany, and Po-
land, on the other hand, will account for almost 25X1
all of the 8 million tons of grain imported,
mainly to feed livestock. The Soviet Union and
US will be the principal suppliers. F
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Mozambique, a Portuguese dependency for
over 400 years, became independent on June
25. The date was set last September in an accord
signed by Lisbon's new military rulers and the
nationalist Front for the Liberation of Mozam-
bique, which had waged guerrilla war for ten
years. The Front's leader, Samora Machel,
became president of the new state.
During the nine months that the territory
was governed by a joint Front-Portuguese tran-
sitional regime, it remained generally free of
political strife. The only notable exception was
a short-lived attempt by dissident whites and
blacks to seize control just after the accord was
signed. At present, the Front appears to be
popular throughout the country; at least there
are no signs of active opposition.
The new government inherits a potentially
prosperous economy, but economic activity was
seriously disrupted by the coup in Lisbon in
April 1974 and has not yet fully recovered. The
coup sparked labor unrest in the territory that
led to decreased production and revenue, infla-
tionary wage settlements, and periodic work
stoppages in Mozambique's major ports.
Machel's regime will have to rely heavily on
Portuguese advisers to sort out economic prob-
lems. The Front lacks trained people, and its
leaders are unfamiliar with the territory's com-
plex economy, which was shaped for the benefit
of Portuguese economic interests and directed
from Lisbon. The Front will also need the co-
operation of Mozambique's whites. They
number about 200,000, out of a total popula-
tion of 9 million, and still dominate the
economy, bureaucracy, and social services.
Some are sympathetic to the Front.
The new government will be under heavy
pressure to alleviate widespread black unem-
ployment by giving to blacks the semi-skilled
and unskilled jobs now held by whites. These
whites cannot afford to return to Portugual, and
Lisbon does not really want them. Racial hostil-
ity between the two working class groups could
eventually become a serious problem.
Economic necessity dictates that Mozam-
bique's black rulers take a cautious, pragmatic
approach toward the white minority govern-
ments in South Africa and Rhodesia. During
Portuguese rule, the territory earned about $200
million annually from rail, port, and tourist
services to South Africa and Rhodesia, and from
the repatriated wages of some 100,000 Mozam-
bique blacks working in South African mines.
South Africa, in turn, invested heavily in
Mozambique, especially in the $500-million
Cabora Bassa hydroelectric power project. A
large share of the electricity from Cabora Bassa
is to be sold to Pretoria beginning later this year.
Machel has joined the presidents of
Tanzania, Zambia, and Botswana and with
South African Prime Minister Vorster in an ef-
fort to mediate between Rhodesian Prime Min-
ister Smith and black Rhodesian nationalists.
The four black African leaders promised the
Rhodesian nationalists that their governments
would eventually support efforts to bring down
the Smith government by insurrection if nego-
tiations failed.
Mozambique's new leaders have been con-
sidering applying UN economic sanctions against
Rhodesian trade carried through the ports of
Lourenco Marques and Beira. During the tran-
sitional period, the Front agreed in principle to
deny these routes unless a constitutional settle-
ment is worked out providing for black majority
rule in Rhodesia. Now they are under pressure
from various quarters to follow through.
Mozambique, however, earns some $30
million a year in rail and port earnings from the
Rhodesian traffic, and Machel cannot afford to
shut off so much income without finding an
alternative. In addition, Front leaders have
privately reflected concern that imposing sanc-
tions might invite Rhodesian military retalia-
tion.
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The new government intends to pursue a
nonaligned policy in world affairs. For a while
at least, Portugal's influence is likely to be
strong because of a common language and deep-
rooted social and economic ties. Lisbon's ability
to offer financial assistance, however, is
hampered by its serious economic difficulties at
home. The USSR and China will enjoy close
relations with Mozambique because of their
military assistance during the insurgency against
Portugal. Diplomatic relations with Peking and
Moscow will become effective upon independ-
ence. The US, which is remembered as Lisbon's
close ally before the coup, was not invited of-
ficially to the independence ceremonies.
ISRAEL: FOCUS ON THE SINAI 3,C-57
The Israeli u?I their attention this
week on the prospects for another interim agree-
ment with Egypt. As reflected in the Israeli
press, their attitude in general was one of
cautious optimism that an agreement could be
reached by the end of the summer.
Prime Minister Rabin, however, is not as
confident. He reportedly told a special cabinet
session called last week to hear his report on his
visit to the US that the odds are "less than
50-50" for such an agreement. According to a
recent commentary by one of Israel's best-
informed political reporters, Rabin is firmly
committed to a hard line on Israeli requirements
for another interim agreement and will not give
up control over the eastern ends of the Gidi and
Mitla passes without a clear Egyptian commit-
ment not to use force for the duration of the
agreement.
Rabin reportedly argues that:
? Retention of part of the passes is nec-
essary as long as there is any doubt about
Cairo's intentions, particularly with respect
to its position in the event of Syrian-Israeli
hostilities.
? He cannot reverse, in the absence of
greater Egyptian flexibility, the position he
took on the passes in March without
destroying his credibility at home.
? The principle of mutuality of conces-
sions must be preserved.
The Prime Minister's apparent hard line
reportedly has critics within the cabinet. The
commentary claims "quite a few" of the min-
isters at the special session argued that Tel Aviv
must not allow another attempt to reach an
interim agreement with Egypt to fail. To do so,
they fear, would invite a confrontation with
Washington. Although these ministers do not
constitute a majority in the cabinet, they ap-
parently obtained Rabin's agreement that any
decision to break off the talks with Cairo must
be made by the entire cabinet and not just by
the negotiating team of Rabin, Defense Minister
Peres, and Foreign Minister Allon.
Rabin, however, is said to believe that
Israel is in an excellent bargaining position be-
cause Egypt and the US want very much to
obtain an early agreement and is strong enough
to live without one if its position is rejected.
Furthermore, Rabin reportedly is convinced the
concessions he offered in Washington make it
impossible to accuse Israel of intransigence and
of torpedoing the talks with Egypt. He thinks
President Sadat will have to come up with
appropriate concessions of his own.
Rabin's popularity as well as that of his
government has shown a significant increase
over the past several months. One of Israel's
more reliable polling organizations reported re-
cently that almost half the people questioned
last May believe the government has fulfilled at
least some of the expectations they had of it
when it took over from Mrs. Meir a year ago. To
some extent, this reflects the sharp rise in
Rabin's own popularity in the wake of the gov-
ernment's firm stand last March in the nego-
tiations for another interim agreement with
Egypt. Two polls published early in June in-
dicated that almost 62 percent approved the
Prime Minister's performance.
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The debate over oil nationalization took a
new turn this week with indications that the
governing Democratic Action Party has aban-
doned its efforts to win opposition support for
the petroleum bill now before the Congress.
Instead, the government reportedly is pre-
pared to use its majority in both houses to
steamroller the controversial bill through, prob-
ably in time for President Perez to make the
historic announcement on July 24, Simon
Bolivar's birthday. During the past three weeks
of debate, opposition continued to focus prin-
cipally on the question of whether private oil
companies would be allowed to participate in
the industry after nationalization.
Article Five of the bill, personally drafted
by President Perez, would allow the companies
to form "association agreements" with the gov-
ernment. The leftist political parties for the
most part would either totally exclude the com-
panies or-in the case of the opposition Social
Christian party-would limit their participation
to selected areas and require prior congressional
approval by a two-thirds majority.
Although the debate is expected to drag on
for several more weeks, political leaders seem
reconciled to the fact that Perez will get exactly
what he wants. As a result, some of the more
extreme leftist political parties are attempting to
promote a nationwide strike to put pressure on
the government. This is unlikely to sway either
Perez or his party. Most government and party
leaders take the view that the assistance of the
foreign petroleum companies in providing tech-
nical and marketing help is essential for some
time to come. Further, they probably believe
that the issues now being debated are too
complex to be understood by most Vene-
zuelans, and the Democratic Action Party will
3k 4!
emerge historically as the one that succeeded in
nationalizing the petroleum industry over the
opposition of other political parties.
The Social Christian party leadership is per-
ceptive enough to recognize the pitfalls of total
opposition to what is in principle a popular
political move by Perez. This may have inspired
several recent attempts to reach a compromise
on Article Five. Although these efforts failed,
the Venezuelan ability to work out a pragmatic
solution to roost seemingly unsolvable political
issues could result in the emergence of some
compromise acceptable to both Perez and the
Social Christian party. Significantly, former
president Caldera, who has been active in
keeping open his lines of communication with
government and party leaders, has yet to speak
publicly on this issue. He will do so when the
nationalization bill goes to the Senate for debate
soon.
In the meantime, talks between govern-
ment representatives and the major oil com-
panies continue in desultory fashion, pending
resolution of the congressional debate. Some
industry sources have expressed surprise at the
lack of preparation by the government team and
its seeming inability to come up with any firm
proposals on the organizational structure and
management of the industry after reversion.
This criticism is increasing both within and out-
side the government. It undoubtedly reflects
concern that the government, in its rush to
nationalize the country's major extractive in-
dustry and major export earner, may have acted
before it was ready to take on the job of
operating a complex multibillion-dollar in-
dustry. The government's negotiations will be
watched closely by the opposition in hopes of
eroding Perez' now strong political position.
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...1 SECRET w
Latin American Communism
MEETING IN HAVANA
High officials from all 24 communist
parties of Latin America and the Caribbean met
in Havana from June 9 to 13 to draw up a
broad, coordinated plan of action aimed at
eliminating US influence south of the Rio
Grande. The plan, embodied in a declaration
released three days after the conference closed
(presumably after the attendees had a chance to
get home safely), is intended to serve as a guide
for all the forces of the left and not just for
communists. Although the meeting was unques-
tionably the high point in the Cuban Commu-
nist Party's relations with its hemispheric
counterparts, it will undoubtedly fall far short
of its grandiose goal of unifying the Latin
American left into a solid anti-US front. There
are likely to be very few leftists willing to adopt
a plan of action formulated at a meeting in
which they had no representation.
Excerpts and summaries of the strategic
declaration-its full text is not yet available-
indicate that the unification of the forces of the
left in the anti-US struggle is the document's
basic theme; it has already become obvious,
however, that whatever unity was achieved, even
among those at the meeting, is likely to be only
a thin veneer of dubious durability. The
Mexican Communist Party, for example, had
hardly reached home before it disowned that
portion of the declaration that criticized
Peking's foreign policy. In addition, parts of the
declaration itself clearly reflect considerably less
agreement than the unanimity it is alleged to
have received.
As for Havana's role, the meeting provided
considerable evidence that the Castro regime is
following a foreign policy more closely aligned
than ever before with that of the USSR. In
signing a document that condemned the Chinese
communists by name and in serving as host for a
meeting that could turn out to be a preparatory
step to a world conference of communist parties
(which Moscow hopes to use against Peking),
the Cubans have gone further than ever before
to support Moscow in the Sino-Soviet polemic.
As if to ratify the blast at Peking, Fidel Castro
personally criticized the Chinese during a press
conference last week and praised the declara-
tion's attack on Peking. Moreover, in signing a
public declaration that tacitly accepts the
validity of the Soviets' view that violence is not
always necessary to achieve power, the Cubans
have gone on record as abandoning Che
Guevara's rigid theoretical concepts of violent
revolution.
The Cubans also gave in to Moscow on the
nature of the conference. Still wary of what it
considers the duplicity of many Latin American
communist leaders, Havana had preferred to
invite a broader range of participants, including
some revolutionary movements anathema to the
orthodox communists. The Cubans apparently
had in mind something akin to the conference
of the Latin American Solidarity Organization
held in Havana in 1967. They were also reluc-
tant to invite some parties whose attendance
might prove an embarrassment to the Castro
regime. The Guyana communists, for example,
were apparently to be excluded to prevent fric-
tion in Cuba's blossoming relationship with
Guyana Prime Minister Forbes Burnham. The
Guyanese finally attended, however, and the
meeting was restricted to the recognized, pro-
Moscow communist parties.
The Cubans were not the only ones to
compromise. The declaration gave high praise to
Fidel Castro-which must have been difficult for
those party chiefs who had at one time been
subjected to his scathing denunciation-and held
Cuba up as a showcase for the blessings of
socialism. The fusion of Castro's guerrillas with
the members of the pre-Castro communist party
into what is today's Cuban Communist Party is
described as "a unity that constitutes an
example for all of Latin America's revolutionary
movements," a clear invitation to the non-
communist left to join forces with the commu-
nists. The Cuban interpretation of the downfall
of Allende in Chile in 1973 was accepted, and
the need to be ready to use violence to defend
revolutionary gains was underscored. The decla-
ration, a formidable document of some 18,000
words, is an attempt to focus attention on the
US as the source of all the region's ills. It is
strongly reminiscent of Castro's own Second
Declaration of Havana on February 1962, which
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SECRET
was also a plan of action to eliminate US in-
fluence in Latin America. The more recent plan
is not likely to be much more successful than its
predecessor, despite its more pragmatic nature
and the changed conditions in Latin America.
entrenched himself so well in the line of succes-
sion that a presidential expression of preference
for someone else would jeopardize the peaceful
turnover of power.
41.54
Peruvian President Velasco appears con-
vinced now of the need to turn virtually all
presidential powers over to Prime Minister and
Minister of War Morales Bermudez.
Since Velasco's stroke on February 28,
Morales Bermudez' influence has steadily in-
creased and, through recent efforts to divorce
himself from Velasco's more radical policies, he
has further improved his position. The virtually
uninterrupted growth of Morales Bermudez'
strength within the military, combined with his
business-like manner and considerable profi-
ciency in economics, makes him the prime
candidate to succeed Velasco.
Radical elements in the military, however,
became concerned, when Velasco first fell ill,
that the pace of his extensive revolutionary
program would be slowed as Morales Bermudez
assumed increasing authority. Recent glimpses
of the Prime Minister's economic policies, par-
ticularly his apparent desire to do away with
Velasco's economic subsidies, have led Velasco
to fear that the radicals might attempt to inter-
vene to ensure that the revolution remains on
course. The principal radicals, General Jose
Graham Hurtado, chief of the President's
advisory council, and General Leonidas Rodri-
guez Figueroa, commander of the second mili-
tary region, which includes Lima, have also
fallen into disfavor lately for political intriguing
and questions of competence.
The moderates who support Morales
Bermudez have become increasingly alarmed at
the leftist trend of the Velasco government.
Although Velasco has yielded much authority to
Morales Bermudez, the President manages to
sustain his radical policies on a number of issues.
The moderates have been particularly dis-
satisfied with Velasco's economic policies, his
repressive measures against critics in the press,
and his short-circuiting of the military seniority
structure by forcing retirements and placing his
supporters in key positions. The moderates are
also suspicious of the extreme leftist leanings of
some of these supporters of Velasco.
25X1
25X1
Despite his strong position, Morales Bermu-
dez appears unwilling to make a decisive move
to replace Velasco. He is likely, for the time 25X1
being, to continue acquiring influence and sup-
port gradually, while avoidin a direct con-
frontation with the radicas.
Despite fundamental political differences
between the two men, Velasco now reportedly
acknowledges that Morales Bermudez has
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4%w SECRET "'r''
Northeast Asia
TRIANGULAR TENSIONS
Growing concern over Soviet intentions in
Asia, in the wake of the Communist victory in
Vietnam, was a major factor behind Peking's
increasing insistence on including an anti-
hegemony provision in the proposed Sino-
Japanese Peace and Friendship treaty. The
failure of the two sides to agree on this thorny
issue ended the current round of treaty talks last
week.
Peking has for some time expressed the
view that Moscow's influence in Hanoi is greater
than its own and that a communist victory in
the south represents an opportunity for the
Soviets to increase their influence there, as well
as in other countries in the region.
The Chinese stepped up their propaganda
attacks against Soviet "social imperialism" and
"hegemonism" after the fall of Saigon; several
commentaries have emphasized Soviet activities
and intentions in Japan. Peking also pointed up
the "hegemonism" issue in the joint commu-
nique establishing diplomatic relations with the
Philippines earlier this month. In that announce-
ment, both countries expressed opposition to
any third country attempts "to establish
hegemony or create spheres of influence in any
part of the world," an even broader formulation
than that proposed for the Sino-Japanese peace
treaty
At the outset of the Sino-Japanese talks on
the peace treaty in January, Tokyo proposed
omitting the anti-hegemony clause it had agreed
to in the 1972 joint communique establishing
relations with Peking. Desiring to maintain a
rough balance in their relations with Moscow
and Peking, the Japanese at least hoped to
soften the terms of the hegemony clause in
order to counter any Soviet backlash to the
conclusion of the peace pact.
Initially, the Chinese responded in a rel-
atively low key manner. Premier Chou En-lai
told a member of the Japanese Diet in January
that the proposed anti-hegemony language was
not directed at Moscow and that, in any event,
the issue should not be an obstacle to reaching
agreement on the pact. Chou predicted that
negotiations could be completed within three
months.
As late as April, the Japanese press was still
predicting imminent agreement. There were
reports that Chinese Vice Premier Teng Hsiao-
ping proposed a compromise that would have
allowed the inclusion of the anti-hegemony
clause in the preamble of the treaty, rather than
in the text-a suggestion the Japanese offered
later.
It was not until May-and the communist
assumption of power in Saigon-that reports
were leaked suggesting that Peking had
demanded that the anti-hegemony issue be
treated in the body of the treaty, thus giving it
greater currency and emphasis. The Chinese
were encouraged to maintain their harder line
when a Japan Socialist Party delegation visiting
Peking in May agreed to a strongly worded
hegemony clause in a joint communique.
Shortly thereafter, Tokyo conveyed its
compromise proposal-including the clause in
the preamble rather than in the text-but were
privately rebuffed by the Chinese. For a time,
Tokyo tried to keep the appearance of talks
alive by claiming that Peking had not formally
responded. Finally, Premier Chou En-lai
reiterated to a Japanese visitor earlier this
month Chinese insistence that the clause be in
the text of the treaty. In going public, Chou also
signaled the end of serious negotiations.
Excessive publicity surrounding the talks
restricted each side's room for maneuver and
may have caused some ill feelings as well. The
Chinese might have agreed to inclusion of the
clause in the preamble if such an arrangement
had been negotiated strictly in private. Given
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the extent of public knowledge about the talks,
however, the Chinese may have felt that their
willingness to compromise on the issue of Soviet
hegemony would have been all too evident-and
would have given the appearance that Peking
had buckled in the face of Soviet-inspired op-
position.
Fhe Chinese also probably calculated-
correctly, in our view-that other aspects of
relations with Japan would be unaffected by
postponing the treaty. Given its political prob-
lems with Moscow, Japan certainly cannot turn
toward the USSR. And in time, Tokyo may
offer Peking a more attractive proposal on the
anti-hegemony issue; in any event, the Chinese
will certainly continue to press Tokyo to accept
their uncompromising stand.
25X1
The Soviets are in a poor position to take
advantage of the breakdown in Japanese-Chinese
negotiations. Soviet tactics over the last two
weeks were fashioned with the expectation that
a treaty would be signed. When it was not,
Moscow was left in the unseemly position of
appearing to apply unreasoned pressure on
Tokyo. The Soviets will now make an effort to
change the atmospherics, but this will not be
very important unless Moscow is prepared to
consider returning at least part of the northern
territories to Japan. But Moscow has itself
firmly locked into a position of even refusing to
consider returning the islands, and the
breakdown in Sino-Japanese talks gives Moscow
even less reason to curry favor with Japan.
Vice Premier Teng Hsiao-Ping
The Soviets might rethink their position if
they had as much influence in Asia as the
Chinese claim they have; Chinese apprehensions
and Asian realities are not one and the same.
Indeed, the Soviets have some concern that it
will be China, not the Soviet Union, which will
gain from the US defeat in South Vietnam.
They are likely to see support for this view in
China's developing relations with Thailand and
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Somare claims he was inspired by a dream
to put the independence date to a vote. Passage
was facilitated by absence from the floor of the
most vocal opponents of cutting ties with Aus-
tralia.
Papua New Guinea
9d-?3
INDEPENDENCE AT LAST
Chief Minister Somare has persuaded a
reluctant territorial House of Assembly to agree
to September 16 as independence day for this
Australian trust territory. Independence, orig-
inally planned for last December, had already
been postponed three times because of dif-
ficulties over a constitution. The House of
Assembly was insisting until last week that the
constitution be ready before an independence
date was set. Although differences remain and
could still delay completion of a constitution,
the fact that Australia has informed the UN of
Papua New Guinea's decision would appear to
commit the colony to holding to its timetable.
The toughest unresolved constitutional
issue is citizenship. Racists in the House of
Assembly are pushing for restrictive qualifica-
tions that would force expatriate Australians to
leave and make persons of mixed blood go
through a period of "provisional" citizenship.
The Somare government is resisting, on the
grounds that such discriminatory requirements
would blemish Papua New Guinea's reputation
at the outset of nationhood.
I he type of government to be set up is also
undecided. Somare wants a centralized admin-
istration and fears that the loose federation
advocated by some political opponents would
lead to early strains. Although the matter can
probably be resolved by compromise, it may
take considerable threshing out.
Choosing a head of state also threatened
for a time to become a major obstacle. The
Somare government's proposal, that as a Com-
monwealth member Papua New Guinea should
have the Queen as head of state, provoked
unexpectedly strong protests led by nationalistic
students. The provision was passed this month
over vigorous opposition and will probably
remain a subject of some contention.
Substantive disagreements aside, Papua
New Guinea's experience with self-government
has been too brief to prepare for a smooth
transition to the parliamentary style of govern-
ment that has been chosen. Also, the new na-
tion's myriad problems-tribal animosities, per-
sistent separatism, and a fragile government
coalition-do not resa a an easy transition.
Page
20 WEEKLY SUMMARY Jun 27, 75
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Approved For Release 2007/12/04: CIA-RDP79-00927A011100070001-3
 Approved For Release 2007/12/04: CIA-RDP79-00927A011100070001-3
Secret
Secret
Approved For Release 2007/12/04: CIA-RDP79-00927A011100070001-3