CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A019500060001-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 20, 2016
• Document Release Date: November 8, 2006
• Sequence Number: 1
• Publication Date: July 14, 1971
• Content Type: REPORT

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lef~i
DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
State Dept. review completed
Secret
N2 041
14 July 1971
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SECRET
No. 0167/71
14 July 1971
Central Intelligence Bulletin
CONTENTS
SOUTH VIETNAM:. Indications point to new flurry of
Communist mi itary action. (Page 1)
CHILE: Allende to sign copper nationalization leg-
islation without change. (Page 2)
MALTA: Negotiations on the UK-Malta defense and fi-
nancial agreements may be on the point of stalemate.
(Page 4)
MOROCCO: Calm and tight security prevail. (Page 5)
INDIA-PAKISTAN: The massive exodus of Pakistani ref-
ugees continues. (Page 7)
ITALY-LIBYA: Rome seeks new oil arrangements with
Tripoli. (Page 8)
PORTUGAL: Constitutional revisions approved.
P age 9)
ZAMBIA: Rhodesian corn imports (Page 10)
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SOUTH VIETNAM: The level of Communist military
activity remains low, but there are numerous signs
that a new flurry of shellings and ground probes is
to begin soon.
The current calm can be attributed, in part,
to the recent heavy rains in the northern sector
spawned by a typhoon and to seasonal flooding in
the delta. North Vietnamese main-force combat units
still pose a formidable threat near the DMZ, and in
the south elements of several enemy regiments have
been assembling near a South Vietnamese artillery
base in the northern part of the U Minh Forest.
Elsewhere, Communist forces have been getting ready
,for what appears to be another monthly increase in
hostilities to be conducted largely by the enemy's
local force and guerrilla units.
Captured documents have called 25X1
for increased action from mid-July through August;
the most frequently mentioned period is 15-25 July.
The action is likely to begin on different days in
different places as individual units complete battle-
field preparations. F777 I 25X1
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CHILE: President Allende has decided to sign
the4cvpge-r nationalization legislation without change,
even though he has criticized it as weaker than he
had wanted. The constitutional amendment authorizing
total nationalization of Chilean copper resources,
which was unanimously approved by the Chilean Congress
on 11 July, enables his government to take immediate
and full control of the large mines as soon as he
signs it.
Despite passage of the amendment, a long nego-
tiating process is still ahead. Talks on the trans-
fer and compensation of the remaining Kennecott and
Anaconda interests have not yet begun, and there are
indications that an agreement reached with the Cerro
Corporation in late May still faces major hurdles
before it is signed. The only appeal open to the US
companies concerns the amount of compensation the
Chilean Government offers. The Allende forces are
making every effort to ensure a majority on the ap-
peal tribunal.
Opposition political forces are now unlikely to
run the political risk of challenging the administra-
tion on the enormously popular issue of copper nation-
alization. In fact, the Christian Democratic legisla-
tors may attack as injurious to Chilean interests the
reasonable buyout agreements already reached with other
US firms. This is partly in self-defense; the admin-
istration, in its effective campaign against Kennecott
and Anaconda, has been charging that the partial na-
tionalization effected by Christian Democratic Presi-
dent Frei left the US companies "free to rob and mis-
manage" the mines until serious damage was done. This
campaign fails to mention that some of the problems
stem from extensive expansion activities carried out
in the mines under the Frei agreements. Other prob-
lems were caused by serious morale and discipline
difficulties that arose among key copper technicians
and workers after Allende took office. Allende is
abetting the propaganda campaign by citing studies
by French and Soviet techni,ci,ans that criticize many
aspects of the US operations.
(continued)
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The amendment gives the President various options,
and`lre will be under pressure from conflicting inter-
ests. Communist officials
~-7probably will advocate a relatively restrained
approach. Extremist Socialists, however, will urge
Allende rkot to use the more moder to provisions of
the law.
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MALTA: Renegotiation of the UK-Malta defense
and i~nancial agreements may be approaching a seri-
ous impasse.
A Foreign Ministry official has informed the
US Embassy in London that the negotiations "may be
on the point of breakdown." The official said that
the departure of Defense Secretary Lord Carrington
for Valletta on a fact-finding mission is being
"urgently reconsidered" as a result of another per-
emptory letter received from Prime Minister Mintoff.
In the letter, Mintoff refused to receive Carrington
unless he is given full negotiating powers and char-
acterized the visit as further evidence that the
British intend to stall the talks. In addition, he
said that "under the present circumstances", the
British should plan to withdraw their troops by the
end of July.
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MOROCCO: Calm and tight security prevail as
the roundup of remnants of the insurgents involved
in last Saturday's coup attempt continues.
Ten officers, all Berbers, were executed yester-
day morning, rather than on Monday as first reported.
They included four generals, five colonels, and a ma-
jor. The generals were the commanders of the first,
third, and sixth military regions (Rabat-Kenitra,
Fez-Taza, and Marrakech) as well as the director of
military training, and included some of Morocco's
best. trained and most able officers.
The Libyan news services continue to express
support. for the Moroccan "revolutionaries," and a
break in diplomatic relations appears imminent. The
Libyan Embassy in Rabat is closely guarded and diplo-
matic personnel are restricted, as is the case with
the Moroccan Embassy in Tripoli; the Moroccan Embassy
in Benghazi, however, is open and functioning
although telephone lines have
been cut. The sma size of demonstrations against
the Moroccan King organized in Tripoli on Monday and
the comments of some Libya.ns suggest that the govern-
ment's premature support for the rebels is causing
some embarrassment.
The public reaction of the Algerian Government
remains cautious and essentially noncommittal. Al-
giers has refrained from issuing any kind of official
declaration on the subject, and there is no firm evi-
dence that Boumediene ever assured King Hassan of Al-
gerian "support and solidarity," as reported in the
international press. The Algerian news media have
not reported Libya's expression of support for the
Moroccan rebels. Algerian Minister of State Cherif
Belkacem, who made a quick fact-finding mission to
Rabat, met on Monday with Boumediene and.a.Libyan
emissary.
Tunisian reaction, predictably, was one of
shock and indignation. Bourguiba telephoned Hassan
on Sunday, and sent a four-man delegation--headed by
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a cabinet member and including the chief of staff of
the army--to Rabat yesterday to express Tunisian
solidarity. Tunisia's main concerns appear to be
whether the King's position will be reinforced as
a result of the coup's failure and what long-term
effect the coup attempt may have on Maghreb unity.
The initial Egyptian press reaction was gener-
ally neutral but became slightly more hostile toward
the Moroccan leadership--especially to General
Oufkir--following the announcement of the execution
of the coup leaders.
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INDIA-PAKISTAN: US officials in Calcutta and
New Delhi estimate that refugees from East Pakistan
are continuing to arrive in India at a rate in ex-
cess of 50,000 a day.
The official Indian count as of 3 July was over
6.5 million and the total may now have reached seven
million. Refugees are beginning to arrive from the
interior of East Pakistan, and reports from the bor-
der areas estimate that Muslims now make up 20 to 25
percent of the new arrivals. The Indians had esti-
mated early in July that 91 percent of the refugees
then in India were Hindus.
Assurances by the Pakistani Government that re-
turnees will be well treated are having little ef-
fect; even Pakistani officials claim that only some
50,000 have returned to East Bengal. Reports by the
new arrivals of continuing persecution by the Paki-
stani Army and by vigilante groups are effectively
discouraging most of those who might think of re-
turning. Embassy officials in New Delhi report that
there is no evidence to support Pakistan's claim
that the Indian Government is attempting to dissuade
the refugees from going back to East Pakistan.
The Indians have, so far, managed to, cope with
the formidable economic, administrative, communal,
and security problems posed by the refugees, but In-
dian officials emphasize that, at best, they are
conducting a holding operation. New Delhi's patience
with the seemingly endless flow is wearing thin, and
it is apparent that Prime Minister Gandhi's moderate
policies on this issue have little nationwide sup-
port.
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ITALY-LIBYA: Rome is seeking a new relation-
ship with Tripoli that could result in Italy's get-
ting preferential access to Libyan oil.
In late June the director general for economic
affairs in the Italian Foreign Ministry captured the
interest of Libyan Deputy Prime Minister Jallud with
two propositions. He proposed an umbrella agreement
under which the Italian state oil agency ENI would
meet all Libyan needs for technical assistance in
the petroleum sector. He also held out the prospect
of Italy's support for Libyan association with the
European Communities--an arrangement in which Tripoli
has reportedly expressed interest.
Italy is seeking assured supplies of Libyan oil,
if possible on a preferential basis, as well as com-
pensation for Italian property nationalized by the
Revolutionary Command in July 1970. ENI has been
unwilling to line up with the international oil com-
panies in the conflict with the producing countries.
ENI vice president Girolli recently argued before an
Italian Senate committee that European consuming
countries should establish and protect direct access
to crude. Ital is heavily dependent on imported
oil and gas.
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PORTUGAL: Prime Minister Caetano has obtained
approval of his controversial constitutional re-
visions granting, among other things, more autonomy
for overseas territories.
Following a major political battle in the Na-
tional Assembly over proposed-revisions of the 1933
Constitution, Portuguese overseas territories now
become autonomous regions with greater freedom to
organize provincial affairs. Nevertheless, the
central government will retain control over inter-
national affairs and other matters, such as the
naming of provincial governors, national defense,
administration and finance, and economic integration.
Despite strong opposition from ultraconservatives
to even such limited changes, the measure was adopted
by an overwhelming majority.
Other significant constitutional revisions in-
clude an enlargement of the National Assembly's mem-
bership and a slight increase in its powers, a mod-
erate.exte.nsion of civil liberties, a strengthening
of the foreign policy role of the president, and the
establishment of common citizenship for Portuguese
and Brazilians. The Portuguese hope to get Brazil's
acquiescence in such an arrangement during Foreign
Minister Patricio's visit to Rio beginning on 25.
August.
Although the basic policy lines of the Portuguese
Constitution have been maintained, the revisions re-
flect Prime Minister Caetano's attempt to appear more
flexible and liberal than his predecessor. He will,
however, face further opposition when he attempts to
aet implementing legislation passed in the assembly.
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ZAMBIA: The government, moving to reduce its
dependence on Portuguese railroads, has signed an
agreement with Rhodesia for essential corn imports.
Rhodesia will supply 150,000 tons of corn, worth
about $12.6 million. The accord, which already has
been approved by the UN Sanctions Committee, comes
in spite of Zambia's policy of reduced dependence
on Rhodesia following its unilateral declaration of
independence.
Domestic production of corn, a main staple of
Zambia's diet, has fallen behind consumption in re-
cent years, necessitating large imports, mainly
through Portuguese-controlled Mozambique. Earlier
this year Zambia suffered from a costly, four-month
Portuguese blockade of its corn imports resulting
from the murder of five Portuguese agronomists by
the Zambia-based COREMO guerrillas. The import
stoppage rapidly eliminated Zambia's surplus stocks
and necessitated the emergency importation of addi-
tional corn via more a ensive routes
Tan-
zania and Malawi.
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