WESTERN EUROPE CANADA INTERNATIONAL ORGANIZATIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A000100330001-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 13
• Document Creation Date: December 12, 2016
• Document Release Date: December 31, 2001
• Sequence Number: 1
• Publication Date: January 15, 1975
• Content Type: NOTES

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Secret
No Foreign Dissem
TLEEF UEYDEE
Western Europe
Canada
International Organizations
Secret
No. 0112-75
January 15, 1975
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Warning Notice
Sensitive Intelligence Sources and Methods Involved
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Classified by 005827
Exempt from general declassification schedule
of E. 0. 11652, exemption category:
g 5B (1), (2), and (3)
Automatically declassified
on: Date Impossible to Determine
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WESTERN EUROPE - CANADA - INTERNATIONAL ORGANIZATIONS
This publication is prepared for regional specialists in the Washington com-
munity by the Western Europe Division, Office of Current Intelligence, with
occasional contributions from other offices within the Directorate of
Intelligence. Comments and queries are welcome. They should be directed to
the authors of the individual articles.
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Swedish Aid to Portugal . . . . . . . . . . . 3
New Cypriot Cabinet Composed of Ministers
Loyal to Makarios . . . . . . . . . . . . . 4-5
Labor Issue Threatens Portuguese
Government . . . . . . . . . . . . . . . . 6-7
A Risky New Year's Agenda for Italian
Prime Minister Moro . . . . . . . . . . . . 8-10
January 15, 1975
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25X1A
Swedish Aid to Portugal
Sweden and Portugal signed an aid agreement for
the first time on January-9 at the conclusion of
a three-day visit by a Swedish delegation. Sweden
also agreed to provide 90 tons of paper to be used
for election ballots.
The Swedes will provide technical assistance
in the fields of telecommunications, housing,
education, and the cooperative movement. Final
decisions on the extent of future aid will be made
either in Lisbon or Stockholm within a month, according
to a Foreign Ministry official.
The Swedish visit was a follow-up to the visit
last October by a Nordic delegation of Social Demo-
crats headed by Swedish Prime Minister Palme. This
latest delegation was exclusively Swedish and
represented the government rather than the Social
Democratic Party. The Swedes are giving priority
to aid to Portugal in order to bolster the efforts
of the Social Democrats against the Communists, who
are well organized and financed. (Confidential)
January 15, 1975
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New Cypriot Cabinet Composed of Ministers
Loyal to Makario s
President Makarios on January 14 announced the
formation of a new cabinet made up of men who have
proved their loyalty to him in the past.
Five of the nine ministers held, cabinet
portfolios at the time of the coup in July, while
two others were important bureaucrats. The other
two are holdovers from the interim Clerides admin-
istration, but they do not owe their political
allegiance to Clerides, who is now a potential
rival to Makarios for the presidency.
Makarios had earlier considered forming a
government of national unity, composed of represent-
atives of all political groups, including the left
and right extremists. He abandoned the idea after
he could not get agreement on appointments, partic-
ularly to the important ministeries of foreign
affairs and interior.
Having excluded all but his supporters from
the cabinet, Makarios will probably seek regular
consultations with political party leaders in
order to maintain a semblance of Greek Cypriot
unity.
According to Makarios
appears to be less secure in is tion since
his return to Cyprus last month. He no longer
trusts many of his old friends and appears more
worried about the activities of his political
enemies.
Makarios, according to is concerned
about the infiltration of hi s opponen s into the
government during his absence, but he is reluctant
to purge them for fear that he may jeopardize the
January 15, 1975
25X1A
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tenuous unity of Greek Cypriots and his own
position. Makarios is particularly suspicious
of derides and will probably try to take credit
for any successes in the intercommunal talks,
which. Clerides is conducting with Turkish Cypriot
leader Denktash.
Clerides and Denktash began preliminary dis-
cussions of political issues and will meet again
later this week to discuss reopening Nicosia
airport and the island's seaports, particularly
Famagusta. The Greek Cypriots, 80 percent of the
island's population, are likely to call for pro-
portional representation of the two communities
in the operation of the airport, under UN auspices,
and joint control of Famagusta port.
The Turkish Cypriots are likely to insist on
equal, representation in the operation of the air-
port. They may also offer the use of Famagusta
port to Greek Cypriots, but they are not likely
to consent to Greek Cypriot participation in its
operation.
The Turkish Cypriot side will be under pressure
to make concessions because of the impending end of
US military aid to Turkey on February 5. Once the
airport and seaport issues are settled, the negotia-
tors will begin to talk about the powers of the
central government in the proposed federation.
Clerides and Denktash agreed yesterday to set up
a sub-committee to discuss remaining humanitarian
issues.
The British, in the meantime, are apparently
planning to begin soon the evacuation to Turkey
of Turkish Cypriots living in the sovereign British
base area in the south of Cyprus. Turkish and
Turkish Cypriot leaders had earlier voiced concern
about, the Turkish Cypriots on the base. They will
now be under pressure to reciprocate by responding
to the humanitarian concerns of Greek Cypriots.
(Secret No Foreign Dissem)
January 15, 1975
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25X1A
Labor Issue Threatens Portuguese Government
The Portuguese Armed Forces Movement is at-
tempting to establish a compromise among the three
parties of the governing coalition by granting
concessions to moderates on the proposed economic
plan while supporting the Communist concept of a
single labor confederation.
The Popular Democrats and the Socialists had
threatened to leave the government over the uni-
tary labor law which they feel will perpetuate
Communist control of the labor movement. The Com-
munists organized a massive rally last night to
demonstrate "popular support" for their position,
and the Socialists were planning a counter-
demonstration today. All of this activity has
led to speculation, but no hard evidence, that a
leftist takeover or a right-wing coup may be im-
minent.
The Movement apparently is trying to reduce
the political tensions that have been building
during the past week. The cabinet meeting sched-
uled to debate the economic and labor plans has
been advanced from Friday to today.
There is no indication of how the Socialists
and Popular Democrats will react to the trade-off
proposal by the Movement. The alternative to the
compromise--leaving the.Communists in the govern-
ment by themselves--is not an attractive option
either to the Movement or the two coalition part-
ners.
It has become increasingly apparent that the
Communists will not surrender the advantage they
now have in the labor movement and are prepared
to carry the debate over the unitary labor law as
far as necessary. It is possible that they would
January 15, 1975
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welcome the political disarray that would ac-
company such a contest because it almost cer-
tainly would cause a postponement of the electior
that is now expected in April. The Communists
have been searching for ways to delay the elec-
tions until they can build a more popular base.
(Secret)
January 15, 1975
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A Risky New Year's Agenda for Italian
Prime Minister Moro
Political activity is resuming in Italy
after the holiday respite, and a number of
emerging issues could strain the cohesion of-the
two-month old Moro government.
Among the issues causing controversy are:
--labor's drive for higher benefits and
wages;
--a pending parliamentary vote on reform of
the state radio.-TV network;
--the consolidation of various investigations
of right-wing coup plotting into one inquiry
under the Rome judiciary--a development
which the left claims is a prelude to a
cover-up;
--proposed changes in the organization of
police forces controlled by the interior
ministry. .Leftists are pushing to grant
police the right to organize into trade
unions;
--parliamentary discussion of a Socialist
proposal to legalize abortion in Italy.
Pressure to take this step has increased
since the French did so recently, and the
battle lines are the same as in the divorce
referendum last year: The Christian
Democrats and Neo-fascists oppose abortion
while the other parties, including the
Communists, favor legalization.
The labor question and. the radio-TV reform
package, however, provide the most immediate and
January 15, 1975
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dangerous problems for Moro. A new round of
negotiations is under way this week between the
government and the labor organization that repre-
sents all of Italy's major unions. Labor's
cooperation is essential to the success of Moro's
economic programs, but preliminary talks with the
unions have not gone well. To offset the effects
of inflation, labor wants higher pension benefits
and steep increases in wage adjustments linked
to the cost-of-living index. The government is
inclined to make some concessions but not enough
to satisfy the unions; another day-long general
strike is scheduled for January 23.
The Republican Party, which has joined Moro's
Christian Democrats in the governing coalition, is
most adamant in resisting labor's demands. The
Socialists, whose parliamentary support provides
the government's majority, are backing the unions'
proposals.
A key factor in the outcome of labor-government
discussions will be the attitude of the Communist
Party, whose influence is predominant in labor
circles. Since the revival of the center-left
coalition in mid-1973, the Communists have en-
couraged labor moderation. A recent debate in the
party's theoretical journal, Rinascita, suggests,
however, that some Communist leaders are arguing
that greater labor militancy is required to force
the government to give Communists a direct voice
in national policymaking.
The reform of the state radio-TV network was
put into effect two months ago by a decree law
which must be approved in parliament by January
29 in order to remain on the books. The reorganiza-
tion weakened traditional Christian Democratic
control over the radio-TV network and gave the other
parties, including the Communists, a larger say in
communications policy.
Right-wing Christian Democrats are unhappy
with the changes, and Moro is worried that they
January 15, 1975
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may support an effort by the neo-fascist Italian
Social Movement--litaly"s fourth largest party--
to block passage of the law in parliament. This
could put the government in the uncomfortable
position of either letting the reform lapse
temporarily or relying on Communist votes to
secure its passage..
Either course would increase tension among
the governing parties. If the law is not approved,
the Socialists--who are the chief beneficiaries
among the center-left parties--will protest. If
Communist votes provide the margin for passage,
the Social Democrats--who were largely responsible
for the fall of the last government--will have a
fresh example to bolster their argument that the
center-left alliance is too strongly influenced
by the Communists. (Confidential)
January 15, 1975
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Secret
Secret
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