SOVIET UNION- EASTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A002300340001-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: December 12, 2016
• Document Release Date: October 9, 2001
• Sequence Number: 1
• Publication Date: December 15, 1975
• Content Type: NOTES

Approved For Release 2001/11/07 : CIA-RDP79T00865AO02300340001-0
To Secret
Soviet Union-Eastern Europe
Top Secret
December 15, 1975
SC No. 00557/75
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Warning Notice
Sensitive Intelligence Sources and Methods Involved
(WNINTEL)
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
DISSEMINATION CONTROL ABBREVIATIONS
NOFORN- Not Releasable to Foreign Nationals
NOCONTRACT- Not Releasable to Contractors or
Contractor/Consultants
PROPIN- Caution-Proprietary Information Involved
USIBONLY- USIB Departments Only
ORCON- Dissemination and Extraction of Information
Controlled by Originator
REL... - This Information has been Authorized for
Release to ...
Classified by 010725
+_xemot from General Declassification Schedule
f E.O. 11652. exemption category:
5B(1) (2). and (3)
Automatically declassified on:
date impossible to determine
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NOCONTRACT/ORCON
SOVIET UNION - EASTERN EUROPE
This publication is prepared for regional specialists in the Washington com-
munity by the USSR - Eastern Europe Division, Office of Current Intel-
ligence, 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.
December 15, 1975
Soviet Views on "Option III" at MBFR Talks. . . . 1
25X1 D
Masherov Addresses Economic Problems. . . . . . . 4
Yugoslavia: Serb Party Names
New Man to Number-Two Post. . . . . . . . . . . 7
25X1 D
USSR: Automobile Industry. . . . .. . . . . . . . 9
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Soviet Views on "Option III"
At MBFR Talks
The Soviets, from Brezhnev on down, continue to
maintain that they are interested in an MBFR agree-
ment, but they reportedly are preparing a cool ini-
tial response to the Western proposal to reduce nu-
clear weapons in return for a reduction in the number
of Warsaw Pact tanks. This is the so-called Option
III, which NATO is scheduled to present tomorrow.
During most of the present negotiating round,
the Soviets have anticipated the Western proposal
and have frequently sought to belittle its military
importance. In a further effort to lessen the pub-
lic impact of the proposal, chief Soviet delegate
Khlestov requested on December 13 that it be pre-
sented at an informal rather than a plenary session.
___Khlestov grumbled that some Moscow authorities were
disturbed by the advance publicity the proposal was
receiving and that "one school of thought," which re-
garded the proposal as merely a .propaganda move,
advocated outright rejection of'Option III. Both
sides have traded accusations about violation-of the
secrecy of the talks and manipulation of the press
in the past. So far the Soviets have at least held
their own in the propaganda field, and they are
anxious to keep the West from seizing the propaganda
advantage.
There is little doubt that the Soviets will
label the Western proposal unacceptable in its
present form, but it is unlikely that they will
flatly reject it. Rejection would bring the nego-
tiations to a complete impasse, and the Soviets ap-
pear to believe that there are advantages to be gained
from continued negotiations and an eventual agree-
ment. Furthermore, the Western proposal has features
December 15, 1975
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that will appeal to the Soviets and thus may transfer
the negotiations to a more productive plane. It
moves some distance, for example, toward recognizing
the long-standing Soviet position that nuclear weapon
systems should be included in the reductions. (SE-
CRET NOFORN/NOCONTRACT/ORCON)
25X1A
December 15, 1975
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Masherov Addresses Economic Problems
Petr Masherov, Belorussian first secretary and
candidate member of the Politburo, has recently de-
livered two somewhat different pronouncements on
economic policy in light of the harvest failure and
other problems. On his home territory and before
the Central Committee met in Moscow, he attacked an
important element of agricultural policy, strongly
implying criticism of the center and perhaps of
Brezhnev. In a post-plenum article in Pravda, how-
ever, he lavishly praised the General Secretary
and directed attention to reform measures in indus-
try, a subject less associated with Brezhnev.
Masherov spoke to a plenum of the Belorussian
Central Committee on November 24, a week before the
CPSU Central Committee and USSR Supreme Soviet dis-
cussed the economy and 1976 plans. He bluntly de-
scribed economic difficulties in the republic. He
noted that the republic targets for industrial
growth next year are smaller than this year and an-
nounced that the Belorussian Central Committee had
already decreed the production of above-plan out-
put. He also noted that procurement plans for milk
and meat next year were no larger than this year's
and warned of possible cuts in the volume of mar-
keted basic foodstuffs if plans are not met. Turn-
ing to the farms, Masherov revealed that only 71
percent of socialized cattle in the republic have
enough fodder to tide them over the winter and that
maintenance of the current size of cattle herds is
in doubt.
Masherov did not stress the weather as the
cause of agricultural shortfalls in the present
five year plan. Instead, he pointed to insuffi-
cient use of available resources and the potential
for improving efficiency, saying that "this, and
only this," is the main reason Belorussia did not
meet important agricultural targets.
December 15, 1975
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The heart of Masherov's criticism of agricul-
tural policy concerned the construction of large
livestock-raising and dairy farming complexes. He
charged that leaders and specialists, rushing to
create complexes and to get investment funds for
this purpose, have ignored the development of feed
production, leaving the new complexes drastically
short. Saying that there are insufficient means
to construct complexes and to create a feed base
simultaneously, Masherov called for a "review" of
the agricultural construction program in the next
five year plan. In fact, he proposed scrapping
the program to build complexes and directing invest-
ments to fodder production.
Although couched in terms of the republic,
Masherov's critique was certainly aimed also at the
agricultural bureaucracy in Moscow, first of all
Agricultural Minister Polyansky, and perhaps agri-
cultural secretary Kulakov. Given Brezhnev's im-
portant role in agricultural policy, Masherov's
discussion would seem to imply criticism of the
General Secretary. An anti-Brezhnev intent may
also be seen in the scarcity of references to the
General Secretary and the refusal to play up the
official line on the effect of poor weather. Over
the years, Masherov has vacillated in his support
for Brezhnev and has on occasion attacked his poli-
cies, such as the consumer program in 1971.
Masherov changed his tune, however, in an
article in Pravda on December 7, shortly after the
Central Committee and Supreme Soviet met in Moscow.
He offered a more positive evaluation of the eco-
nomic situation and put more blame on the weather
for harvest difficulties. He repeatedly praised
Brezhnev and attributed Belorussian successes to
effective party and government measures taken "at
the initiative and with the direct personal partici-
pation" of Brezhnev.
December 15, 1975
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Remarking on the enormous size of investment
funds, Masherov said the important question was the
effectiveness of their use, which depends on local
organs (republic, kray, and oblast) and on union
ministries and departments. Instead of arguing for
altering investment programs, Masherov used the
theme of effectiveness to advocate management re-
forms. In general, he complained about the con-
tinued sway of indicators of volume and quantity.
In particular, he commended a Belorussian experi-
ment in the construction industry, where he said
"new approaches and radical solutions" must re-
place the "forceful methods" of the past.
The experiment, to start in January, introduces
new planning and payment procedures, expands the
use of economic levers and the rights of builders,
and puts the ministry involved on a cost-accounting
basis. Besides using this example to advocate re-
form measures in general, Masherov may also have
been trying to demonstrate that the republic is
addressing probltms in the construction industry,
which he sharply criticized at the Belorussian
plenum.
Differences in forum and timing may account
for some of the variations in Masherov's two state-
ments. The variations help obscure Masherov's pre-
cise intent. The statements, nevertheless, show
that economic difficulties provide an opportunity
both for opening debate on investment programs and
for raising the issue of reforms. (UNCLASSIFIED)
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December 15, 1975
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Serb Party Names New.
Man to Number-Two Post
In its first important personnel move in almost
three years, the Serb party leadership last Saturday
named a 39-year-old economic functionary to its num-
ber-two post.
The newcomer, Ivan Stambolic, takes over one of
the most responsible posts in the Serbian party. As
a secretary of the republic party, Stambolic will be
in the direct line of fire for the day-to-day manage-
ment of both party affairs and important political
and economic developments.
Stambolic may have some high-ranking patron in
his corner. His name suggests a relationship to
Petar Stambolic, Serbia's representative on the Yugo-
slav collective state presidency.
Stambolic has been a member of the Serb central
committee only since April 1974, and it is unusual
for such a 'junior official to assume such responsi-
bility in Serbia. The move suggests that the re-
public party is bowing to pressure from the federal
party organization to inject new blood into the local
leaderships.
Stambolic's predecessor was Djordje Lazic, a
58-year-old party hack who came to power in January
1973, when another younger man, after only four months
on the.=-job, was ingloriously sacked for incompetence.
Press comments suggest that Lazic might now be the
scapegoat for poor economic results. (CONFIDENTIAL)
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December 15, 1975
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USSR: Automobile Industry
The USSR is preparing to more than double the
size of its car industry. By 1980, it expects to
expand its production capacity to at least three
million units per year, compared with 1.2 million
units at present. Minister of the Automotive In-
dustry V.N. Polyakov, formerly head of the Tolyatti
plant, and D.M. Gvishiani, deputy chairman of the
State Committee for Science and Technology, are
pushing some of the negotiations with Western firms
for help in building one or more plants. They are
talking with at least one US company about building
a new plant and have talked to Fiat about doubling
the size of the Tolyatti plant, which now. is pro-
ducing 660,000 cars per year.
The Soviets are also seeking car design, plant
layout, and production equipment. They are offering
to pay for the assistance partly in components and
finished cars, an arrangement that Fiat prefers to
the long-term financing of its earlier contract.
US firms are reluctant to join the Soviets in
this kind of venture because of possible competi-
tion with their overseas subsidiaries. Fiat, how-
ever, seems ready and willing to sign a second
contract with the USSR, despite costly overruns and
disappointing financial returns from the Tolyatti
experience. Fiat will insist on protecting its
Western markets by restricting Soviet exports, which
it failed to do before.
Although the USSR wants to expand markets in
the West, it is building cars mainly to increase
its domestic inventory, now about 5 million, and to
supply other CEMA members. Last year the industry
turned out 1.1 million cars and exported one fourth
of them to Eastern Europe. Some 40,000 cars were
exported to Western Europe. (CONFIDENTIAL)
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December 15, 1975
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