CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A015100110001-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 16
• Document Creation Date: December 15, 2016
• Document Release Date: May 15, 2003
• Sequence Number: 1
• Publication Date: December 12, 1969
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
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No. 0297/69
12 December 1969
Central Intelligence Bulletin
CONTENTS
South Vietnam: Security forces at Tan Son Nhut have
been put on alert as a result of coup rumors. (Page 1)
Japan: Economic issues are playing an important part
in the election campaign. (Page 3)
Indonesia: The Consortium has accepted Indonesia's
request for a high level of new aid. (Page 4)
Israel: The new coalition indicates the tough for-
eign policy and military stance will be maintained.
(Page 5)
Yugoslavia-Bulgaria: Talks at the foreign minister
level have been temporarily broken off. (Page 6)
Brazil: Charges of brutality toward prisoners could
seriously embarrass the government. (Page 7)
Ecuador: The President has replaced two cabinet min-
isters and is under pressure to remove another.
(Page 8)
Canada: Trudeau's popularity has declined consider-
ably. (Page 9)
Libya: Relations with US (Page 10)
Korea: Hijacking (Page 10)
Japan-Philippines: Export credits (Page 11)
European Communities - Spain: Negotiations (Page 11)
Chile: Military plotting (Page 12)
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South Vietnam: South Vietnamese Air Force units
at the Tan Son Nhut headquarters complex have been
put on alert and the National Police guard force
there has been doubled as a result of new coup ru-
mors in Saigon.
There is no evidence of any actual coup plotting
in the initial reporting from Saigon, however, and
the top leadership there does not seem unusually
nervous. Nevertheless, even these limited precau-
tionary measures might undercut government efforts
to develop an image of stability, confidence, and
constitutionality. Regime opponents almost certainly
will seek to exploit this evidence of regime nerv-
ousness, and considerable behind-the-scenes political
maneuvering is likely to ensue.
The coup rumors, the government's precautions,
and any actual plotting that may have occurred come
at a time of generally heightened political activity
in Saigon. These all seem to be related to attempts
to take advantage of the bitter reaction against the
government's tax and price hike in late October.
The reaction has been particularly strong among gov-
ernment and military officials.
For most of the past year, key military leaders
apparently have recognized that the overthrow of the
constitutional government would entail a serious
risk of losing US support for the war effort. The
recent flurry of coup rumors, however, suggests that
some military officers again think that a coup might
be a practical possibility. Those opposition ele-
ments who fear Vietnamization is a prelude to a deal
with the Communists, rather than a way to continue
the fight in the absence of progress on negotia-
tions, may also be persuaded to think in terms of a
coup.
(continued)
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The government's failure to keep opposition
elements convinced of its stability is partly caused
by President Thieu's growing suspiciousness and his
consequent tendency to isolate himself from all but
a close group of advisers. Thieu's handling of the
austerity tax and his public position on the My Lai
affair both point to an insensitivity to the polit-
ical situation.
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Japan: Economic issues are playing an important
part in the current election campaign.
Opposition party candidates for the general
elections on 27 December are largely ignoring inter-
national issues like Okinawa and focusing on bread-
and-butter matters such as continuing inflation and
growing rice surpluses. The ruling conservative
party candidates are also playing up local issues,
but at the same time are benefiting from popular
reaction to the Okinawan reversion settlement.
Popular concern centers particularly on higher
than usual increases in consumer prices in recent
months. Inflation is having a particular impact on
the rural population, which traditionally has been
a primary source of electoral support for the ruling
conservatives. Rural voters are especially concerned
over the government's decision this year not to in-
crease the prices paid to rice producers.
The Sato administration, however, is reluctant
to take any more drastic measures, such as cutting
subsidy payments to reduce the growing rice surplus,
just before the elections. Eventually, however,
the government will have to find some politically
palatable formula for reducing the rice surplus be-
cause the problem is going to get worse over the
next few years.
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Indonesia: A harmonious Consortium meeting in
The Hague accepted Indonesia's request for a high
level of new aid, but there is likely to be disagree-
ment over terms for settling Indonesia's debt at the
meeting in Paris today.
The Intergovernment Group on Indonesia closed
its two and one-half-day meeting in almost complete
agreement concerning Indonesia's request for $600
million in aid for a 15-month period ending April
1971. The amount requested is being supported by
the International Monetary Fund and International
Bank for Reconstruction and Development, and roughly
matches pledges for $500 million during the current
year, not all of which was utilized. Food aid re-
quirement is estimated at $140 million and nonfood
aid at $460 million.
Although the meeting was not a pledge session,
several delegations indicated their intentions to
increase their assistance for the coming year. The
Japanese and French delegations, which in the past
have usually expressed serious reservations as to
the total aid request and other aspects of the
Indonesian situation, joined other donors in approv-
ing the request as well as Indonesia's over-all
performance.
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Israel: The composition of Mrs. Meir's new
coalition government indicates Israel's already
tough foreign policy and military stance will be
maintained.
tic issues and in foreign policy. Thus it seems
certain that Israel will remain uncompromising in
The broad coalition which Mrs. Meir has finally
hammered out in over a month of party negotiations
gives cabinet representation to parties accounting
for more than 100 of the 120 members of the Knesset.
Those remaining outside--some 18 or so--are a mixed
bag of Communists, mavericks, rightist rebels, and
four members of former prime minister David Ben-
Gurion's party.
The most striking change in the composition of
the 24-member cabinet is the stronger presence of
the rightist Gahal Party, which wrested six posts
from Mrs. Meir; it previously had two. Gahal fol-
lows a militant hard line toward the Arabs and advo-
cates increased Israeli settlement of the Arab lands
and a "don't give an inch" policy regarding the re-
turn of the occupied Arab territories.
Mrs. Meir's Alignment holds 14 of the posts,
including the key ministries of defense, foreign
affairs, and finance. Gahal, however, appears to
have obtained considerable leverage on policy through
its ability to break up the national unity coalition.
Mrs. Meir could easily have formed a smaller
coalition majority without either the religious
parties or Gahal, but she preferred to establish
the broader coalition to keep interparty differences
within the family and to project the image of na-
tional unity. In so doing, Mrs. Meir apparently
decided to sacrifice some flexibility both on domes-
its attitude toward a peace settlement.
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Yugoslavia-Bulgaria: Talks in Belgrade at the
foreign minister level reportedly were broken off
temporarily on Tuesday.
Bulgaria's Ivan Bashev proposed a joint decla-
ration in which Sofia would renounce its territorial
claims on Yugoslav Macedonia if Belgrade would admit
that Macedonians living in Yugoslavia are ethnically
Bulgarian. The Yugoslavs rejected the offer out of
hand, seeing it as undermining their own position
that the Macedonians constitute a separate nation-
ality. They also regard it as confirmation that
Sofia, despite statements to the contrary, has no
intention of dropping irredentism.
The Bulgarians possibly made the offer to dis-
credit Belgrade's charge that Sofia is to blame for
continuing polemics, knowing that it would be re-
jected. Belgrade also will probably fail to per-
suade Bashev that the Bulgarian press should stop
claiming that its troops played a major role in
liberating Yugoslavia during World War II. These
claims infuriate the Yugoslavs, who consider them-
selves responsible for expelling the Nazis.
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Brazil: Charges of brutality toward prisoners
could seriously iously embarrass the government.
The accusations, made by the news media and
some members of the Catholic hierarchy, are an out-
growth of an all-out campaign to repress terrorism
in several urban areas, especially Sao Paulo. Mili-
tary and civilian security officials have arrested
many suspected terrorists, their relatives, and other
persons who might have information on terrorist ac-
tivities. Those detained have included students,
opposition politicians, and clergymen. Some prison-
ers have been tortured to extract information, and
at least one person has died as a result of beatings.
Several others have been severely injured.
.The justice minister has said that the govern-
ment has no evidence of torture, but will severely
punish anyone found responsible for such acts. Of-
ficials of the new Medici administration apparently
believe that a public investigation may be necessary
to clear the government's name, but this could cause
serious difficulties in the security forces.
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Ecuador: President Velasco has replaced two
cabinet ministers and is being pressured by striking
teachers to remove the minister of education.
The new finance minister, Luis Gomez, apparently
was chosen for his ability rather than allegiance to
Velasco. The previous minister had failed to secure
foreign loans to improve Ecuador's serious fiscal
situation. In a surprise move, Velasco also replaced
the secretary general of administration, reportedly
because he had lost the President's confidence.
The country's teachers are entering the fourth
week of their strike to bring about the dismissal of
the minister of education. Because teachers tradi-
tionally enjoy considerable public support in Ecua-
dor, Velasco has treated this challenge with unusual
discretion. On 1 December he announced that the gov-
ernment was dipping into the 1970 budget for funds to
give teachers some of the back pay owed them. The
President's support for his minister of education,
however, has not weakened publicly.
More cabinet changes may be in the offing.
Sources close to the government say that the minis-
ters have been talking about submitting their joint
resignations in order to leave the President free
to appoint a new cabinet in 1970.
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Canada: Prime Minister Trudeau's popularity
has declined considerably, according to the latest
Gallup poll.
The colorful leader's standing suffered partic-
ularly among English-speaking Canadians who are dis-
satisfied with his seeming preoccupation with Quebec
and neglect, of the problems of other provinces. He
is also less popular among young Canadians than older
people.
The Gallup poll findings differ to some extent
from those of a poll conducted recently by Executive,
a magazine directed at businessmen. By a margin of
four to one, Executive readers indicated that they
would vote to re-elect. Trudeau and his Liberal Party
confreres. It should be noted, however, that this
poll was taken before the presentation of the gov-
ernment's proposals to raise taxes on small busi-
nesses and middle income earners.
Trudeau has been hurt by his off-the-cuff re-
marks such as the suggestion to Western farmers to
"sell your own wheat." Also causing problems have
been the government's lack of major progress in
housing, poverty, and regional development, and its
ineffectiveness in dealing with aid to Biafran ref-
ugees.
Although the Prime Minister's image has been
tarnished, it has not been destroyed, however. If
an election were held tomorrow, he probably would
win.
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Libya: The military junta may attempt to im-
plicate the US in the coup plotting that led to the
recent arrest of two cabinet members. Speaking over
Libyan television, junta leader Qaddafi noted that
the plot coincided with the beginning of negotiations
on US withdrawal from Wheelus Air Base. He alleged
that the plotters had "income or support from the
bases." Qaddafi also alluded to former minister of
defense Hawwaz's recent dealings with two US firms
that have been having problems with the Libyan Gov-
ernment. Qaddafi's speech suggests that the Libyans
will probably take an extremely uncompromising stance
in next week's negotiations.
Korea: Pyongyang has not commented as yet on
yesterday's hijacking of a South Korean commercial
airliner to North Korea. The circumstances are
still under investigation by South Korean author-
ities. The Seoul government so far has responded
in low key to the incident and has indicated to US
officials that it will seek the release of the pas-
sengers, crew, and plane through the International
Committee of the Red Cross and the Korean Military
Armistice Commission. In an earlier hijacking case
in 1958, this procedure resulted in the release
within a month of the crew and those passengers
choosing to return to South Korea. The plane was
not returned.
(continued)
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Japan-Philippines: Tokyo has suspended ex-
tending export credits to the Philippines. According
to Japanese Ministry of Finance officials, future
extensions will depend largely on what the Filipinos
do to remedy their deteriorating foreign exchange
situation. Tokyo probably believes that the Philip-
pines could become, like Indonesia, unable to meet
debt repayments.
Japan and most other major creditors would like
Manila to accept International Monetary Fund (IMF)
guidance in remedying the situation. So far Philip-
pine government leaders have balked at any such sug-
gestion because they think the terms would be oner-
ous and grate on nationalistic sentiments. The
growing pressure from creditors to rectify the coun-
try's foreign exchange difficulties, however, seems
to be softening the Filipino attitude about accepting
IMF guidance.
European Communities - Spain: Negotiations
last week on a preferential trading arrangement between
the European Communities (EC) and Spain ended with
one major and several minor points unresolved. It
had earlier been hoped that the arrangement could be
concluded at this meetin .
T ese negotiations, Which
Spain hopes will lead to its ultimate association
or membership in the EC, are not expected to resume
again until late January or early February.
(continued)
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Chile: The nature and extent of military plot-
ting against the Frei government has been further
obscured by the confusing language of an army com-
munique of 10 December. It listed some alleged
conspirators, but said that none had been detained.
Neither the role of General Roberto Viaux nor the
activities and relationships of several disaffected
officer groups have been clarified. Opposition
political factions are clamoring for the government
to release more information on the alleged plotting,
and these demands are likely to be echoed by the in-
creasingly confused public.
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