CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A014800020001-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: December 15, 2016
• Document Release Date: February 5, 2004
• Sequence Number: 1
• Publication Date: October 18, 1969
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
5
18 October 1969
State Dept. review completed
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No. 0250/69
18 October 1969
Central Intelligence Bulletin
CONTENTS
Bolivia: The government has nationalized the US-
owned Gulf Oil Company. (Page 1)
USSR: The Soviets are improving the missile capa-
ifi lities of Kresta-class cruisers. (Page 3)
Communist China: Peking has issued its first com-
pre ensive economic statement in three years. (Page 4)
Western Europe: A debate is likely over Germany's
measures to protect its farmers. (Page 5)
Libya: Government attempts to generate popular sup-
port may create a threat to Wheelus. (Page 6)
India: Two significant encounters are shaping up
in -the power struggle. (Page 7)
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Poland - West Germany: Relations (Page 10)
UK: Troops to Germany (Page 10)
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C Bolivia: The Ovando government announced the
"total nat nalization" of the US-owned Bolivian
Gulf Oil Company last night.
The company's local manager was placed under
house arrest and its installations occupied by
army troops earlier in the day. This drastic ac-
tion followed a statement issued by Minister of
Mines Marcelo Quiroga charging Gulf and the World
Bank with "political and economic blackmail." Ac-
cording to the La Paz press, Quiroga received a
cable from the Bank saying that any change in
Gulf's contract without prior approval from the
Bank would be grounds for cancellation of the
Bank's loan contract with Bolivia.
The leftist and ultranationalistic Quiroga's
statement showed him to be particularly incensed
with the government's indecision on how to handle
Gulf. Earlier this week, the cabinet had reportedly
split evenly on a vote on expropriating the company
and postponed a second meeting on the same subject.
Quiroga was quoted as saying, "The government must
decide between proving its nationalist essence or
being forced to retreat."
Demands for the expropriation of the company
have been increasing from both the ultranationalistic
members of the cabinet and student and labor groups
throughout the country. President Ovando had stated
that he thought that expropriating the company would
be "unnecessary," but when Quiroga went over the
President's head and took the issue to the public,
the pressure apparently became too great.
18 Oct 69 Central Intelligence Bulletin
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New Missile Systems Seen on Kresta -class Cruiser
New quadruple-tube missile launcher
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Twin # tul s, U-3 cr y missile la nch
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USSR: The Soviets are improving the missile
capabilities of their Kresta-class guided missile
cruisers.
hoto rah of the sixth unit of this
class
shows that it has two quadruple launchers tor a new
type of surface-to-surface or antisubmarine missile.
The two twin SS-N-3 cruise missile launchers and
the associated guidance radar carried on the earlier
ships of this class have been removed.
The modified Kresta also carries the new air
defense equipment found on the Moskva-class guided-
missile helicopter cruisers. This includes two twin
launchers for a new surface-to-air missile, a large
air search radar that is capable of roviding target
data in range, altitude, and azimuth,
18 Oct 69 Central Intelligence Bulletin 3
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Communist China: Peking has issued its first
comprehensive statement, on the economy in three
years.
The statement was published in the October is-
sue of the theoretical journal Red Flag and broad-
cast on 13 October. While containing many Maoist
formulations., it essentially reaffirms a moderate ap-
proach to economic policy. The "primary role" of
heavy industry is restated, but agriculture and
light industry also are to be developed, drawing on
native technology. There is nothing in the article
to suggest that the priority given to the develop-
ment of modern weapons by the regime in recent years
will be changed..
The article is essentially pragmatic in tone.
For example, there is no condemnation either of
private plots or of the other material incentives
that, conservative party bureaucrats are alleged to
have pushed in past years. In addition to endorsing
the long-standing policy of building new industries
in the interior, the article also touts the 1969
small-plant construction program as a means of devel-
oping relatively independent industrial systems in
local areas.
The very fact that a comprehensive article of
this nature has been published at all suggests that
regime leaders believe the internal situation has
calmed down sufficiently to allow Peking to address
itself to economic problems, including systematic
economic planning. Nevertheless, the ambiguity in
the article suggests that a number of issues, in-
cluding the crucial one of the precise mix between
light and heavy industry, may still not be fully
18 Oct 69 Central Intelligence Bulletin
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Western Europe: A serious debate may be shaping
up in the European Communities over how to protect
German farmers from the consequences of the forth-
coming revaluation.
The Germans are likely to press the EC to pro-
long for as much as two years the temporary import
levies that were authorized when the mark was al-
lowed to float. The EC Commission believes, however,
that isolating both the French and German farmers
for so long a time would seriously damage the Common
Agricultural Policy (CAP).
The Commission may, therefore, advocate a sys-
tem of direct income support to German farmers.
This would be less vulnerable to monetary disturb-
ances and might even be considered for future ap-
plication on a wider scale under the CAP.
The German Farmers Union has sharply rejected
such a scheme, and its position is likely to provide
an early test of the new Bonn coalition's approach
to European agricultural problems. Less dependent
on farmer support than the Christian Democrats, the
new coalition parties are inclined toward a more
flexible farm policy. However, their very narrow
Bundestag majority will act as a strong deterrent
to proposals certain to estrange farm interests.
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Libya: The Revolutionary Command Council's at-
tempts to generate popular support may be creating a
new threat to Wheelus Air Base.
At a rally in Tripoli on 16 October, junta leader
Qaddafi called for the evacuation of US and UK mili-
tary bases. This was apparently an attempt to capi-
talize on what the council hopes will be a popular
emotional issue. Although Qaddafi's declaration on
Wheelus represents a disturbing departure from of-
ficial statements and indicates a greater sense of
urgency, he avoided setting any specific time limits.
He may, therefore, have only been resorting to a
time-proven method of generating public support in
the Middle Ea.st--attacking foreign bases--without
really intending to press for an early evacuation.
The popular reaction in Libya in the days to
come, however, may be such that the council will have
to alter its previously announced intention to allow
the US to remain at Wheelus until the expiration of
the base agreement.
18 Oct 69 Central Intelligence Bulletin
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India: Two significant encounters are shaping
up in the power struggle between Prime Minister
Gandhi and her opponents in the Congress Party.
In an effort to consolidate her dominance over
the party, Mrs. Gandhi is moving to unseat party
president Nijalingappa, an old-guard conservative.
According to the US Embassy in New Delhi, Mrs. Gandhi
is planning to gather supporters for a petition that
would force the party to hold its presidential elec-
tion this December, a year earlier than now scheduled.
This move will push Congress members into a "with me
or against me" decision regarding Mrs. Gandhi.
Old-guard leaders are attempting to undercut the
prime minister by focusing parliamentary attention on
the policy "blunders" of one of her key advisers,
leftist Foreign Minister Singh. Because Singh is al-
ready disliked by many Congress members, the old-guard
leaders hope this maneuver will split Mrs. Gandhi's
Congress supporters in parliament. When parliament
reconvenes on 17 November, the old-guard leaders
would like to deal Mrs. Gandhi a sharp rebute. They
hope to achieve this by pushing through a motion of
no confidence in Singh's handling of foreign affairs,
which could topple the controversial minister from
office.
For the moment, Mrs. Gandhi is pushing the at-
tack. At least one of her major supporters is said
to be hedging his bets, however, and the eventual
outcome is far from being settled.
Central Intelligence Bulletin 7
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Poland -- West Germany: Polish Foreign Minister
Jedrychowski,, in a West German television interview
on 16 October, restated Warsaw's willingness to nego-
tiate all outstanding bilateral issues. Jedrychow-
ski's statement that normalization of relations be-
tween the two countries will be the result of a
"process" of negotiation implies Polish flexibility
and hope that Bonn "will reconcile itself to the
present political map of Europe." Jedrychowski's
statements as well as the start last week of bi-
lateral economic talks in Bonn are meant to under-
score Warsaw's hope for further progress after the
formation of a new West German Government.
Minister Healey definitely plans to return the bri-
gade, although he expects opposition from some gov-
ernment officials and the cabinet. The cabinet
might balk unless London is able to work out an ac-
ceptable financing plan with Bonn to offset foreign
U.K: Britain is actively considering returning
the UK Sixth Mobile Brigade to West Germany, accord-
ing to British General Walker. The brigade would
help fill the gap created when Canada completes its
planned withdrawal of approximately half of its
NATO forces from Germany. Walker stated that Defense
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exchange costs.
Central Intelligence Bulletin
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