CENTRAL INTELLIGENCE BULLETIN
Document Type:
Collection:
Document Number (FOIA) /ESDN (CREST):
CIA-RDP79T00975A019600060001-8
Release Decision:
RIPPUB
Original Classification:
T
Document Page Count:
9
Document Creation Date:
December 15, 2016
Document Release Date:
February 19, 2004
Sequence Number:
1
Case Number:
Publication Date:
July 27, 1971
Content Type:
REPORT
File:
Attachment | Size |
---|---|
CIA-RDP79T00975A019600060001-8.pdf | 290.41 KB |
Body:
Approved For Release 2004/03/18 : CIA-RDP79T00975A01960ftMt8
25X1
DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
N2 42
State Department review completed
27 July 1971
Approved For Release 2004/03/18 : CIA-RDP79T00975A019600060001-8
25X1 Approved For Release 2004/03/18 : CIA-RDP79T00975AO19600060001-8
Approved For Release 2004/03/18 : CIA-RDP79T00975AO19600060001-8
Approved For Release 2004/t.fDP79T00975A019600060001-8
No. 0178/71
27 July 1971
Central Intelligence Bulletin
CONTENTS
JAPAN: Trade relationships with Nationalist China
and South Korea. (Page 1)
CEMA: Ceausescu's opposition to Moscow's version
of economic integration. (Page 2)
SPAIN: Cholera outbreak. (Page 3)
EAST PAKISTAN: Famine probable (Page 4)
SYRIA-JORDAN: Border closing (Page 4)
INDIA-YUGOSLAVIA: Hard currency trade (Page 5)
INTERNATIONAL MONETARY DEVELOPMENTS: Policy on ex-
change-rate fluctuations (Page 5)
Approved For Release 2004/03/ 1,: fp.1 IRP79T00975A019600060001-8
Approved For Release 2004/03/ &kf 79T00975A019600060001-8
JAPAN: Japanese companies are reconsidering
their trade relationships with Nationalist China
and South Korea.
Several major Japanese corporations have decided
not to attend the annual meetings of the Japan-Korea
and Japan - Republic of China Cooperation Committees.
New Japan Steel and Japan Airlines were the first to
cancel plans to send observers to the latter and
Taipei promptly canceled invitations to all other
firms to save face. Moreover, five of the six Jap-
anese shipping firms serving Taiwan plan to terminate
their service, according to press reports.
US Embassy sources in Seoul indicate that Toyota
Motors is seeking to liquidate its substantial in-
volvement in South Korea.
These moves reflect the growing sensitivity of
Japanese firms toward political and economic in-
volvement with Taiwan and South Korea in view of
what they believe is an improving atmosphere for
economic relations with Communist China. Part of
this sensitivity stems from the "Four Principles"
set forth by Chou En-lai in April 1970, which in-
cluded a prohibition against Japanese firms trading
with South Korea or Taiwan.
Over the short term, many firms are interested
mainly in reducing the visibility, rather than the
substance of their trade relationships with the two
countries; over the long run, however, a growing
number of companies will have to choose between
immediate economic benefit in Taiwan and South
Korea and what they believe is a potentially more
lucrative market on the mainland.
27 Jul 71
Central Intelligence Bulletin
25X1
Approved For Release 2004/031.40
Approved For Release 2004/03/18 : CIA-RDP79T00975AO19600060001-8
SECRET
CEMA: Romanian leader Ceausescu will continue
to oppose Moscow's version of economic integration at
the annual session of the Council for Economic Mutual
Assistance (CEMA) that opens today in Bucharest.
To be attended at the chief-of-government level,
the three-day meeting may reveal diverging interests.
These could lead to some minor fireworks with Romania,
in particular, over approval of the draft program
"for a further deepening and improving of cooperation
and for developing socialist economic integration."
The CEMA executive committee approved the draft pro-
gram earlier this month. Although barbs are likely
to be traded, especially by the USSR and their Ro-
manian hosts, the usual public acknowledgment of
respect for national sovereignty will permit Bucharest
to accept a CEMA program document. Previous emphasis
on the coordination of national economic plans is
likely to give way to the narrower aspect of invest-
ment planning where some progress is possible.
In addition to heralding past "progress," largely
in the fields of industrial standardization and some
intranational cooperation among industries, the meet-
ing may note further inching forward toward integra-
tion by the confirmation of projects to receive funds
from the new CEMA International Investment Bank. This
may represent the carrot in attracting East European
support for further efforts toward integration. The
stick wielded by the USSR remains its storehouse of
raw materials now supplied under pricing or barter
arrangements favorable to Eastern Europe.
Ceausescu has reaffirmed his opposition to eco-
nomic integration in several recent speeches. Last
Friday, while asserting that CEMA is "an important
body," he nevertheless added that "interdependence
in production must in no way infringe on national
sovereignty" nor influence the right of any party
to determine for itself the program of development
that it wishes. He then drove home his point by
remarking that "the times of tlic of domination
and diktat are gone forever. "
27 Jul 71 Central Intelligence Bulletin
25X1
Approved For Release 2004/03/SEC R -R.QP79T00975A019600060001-8
Approved For Release 2004/03/1> -FFlQf 9T00975AO19600060001-8
SPAIN: The outbreak of cholera near Zaragoza
in northeast Spain may spread to southern France.
First confirmed on 22 July, cholera probably
reached Spain from Morocco--the first country bor-
dering the Mediterranean to be infected this year.
Actual incidence of cholera in the Zaragoza
area probably is ten times the 250 clinical cases
reported thus far. Although health authorities are
carrying out mass vaccinations, the vaccines are
only about 50 percent effective. Thus the further
spread of cholera, at least in Spain and possibly
to France, is likely.
The disease, which is transmitted by humans,
could easily be carried outside Spain by tourists--
some 2.8 million, predominantly Frenchmen, visited
Spain in July. Although Zaragoza is not the most
favored tourist area, it nonetheless ranks eighth
in the number of overnight visitors. 25X1
27 Jul 71 Central Intelligence Bulletin
Approved For Release 2004/03/ I L-D9P79T00975A019600060001-8
Approved For Release 2004/0 ~J ff- DP79T00975A019600060001-8
NOTES
EAST PAKISTAN: According to the US Consulate
in Dacca, famine appears probable and the most crit-
ical food period will be the last two months of 1971
before the large rice crop is harvested. A smaller
crop, due for harvesting in September, will provide
some temporary relief, but transport bottlenecks will
prevent much of this crop from reaching those areas
that need it most. The government has so far taken
no meaningful steps to speed the movement of food-
grains, and distribution from the ports to the in-
terior is lower in July than it. was in June. There
is no indication that the government intends to do
much to alleviate these bottlenecks. In this situa-
tion, not all of the estimated 1.4 million tons of
foodgrain imports needed through December can be
moved to the deficit areas, and the consulate be-
lieves that starvation is likely beginning in Novem-
SYRIA-JORDAN: Syria has closed its border to
exports from Joan, as a gesture toward joining the
wave of Arab reaction against King Husayn's suppres-
sion of the fedayeen. The closure primarily affects
Jordan's leading export--phosphate rock. There prob-
ably will be no immediate serious economic damage to
Jordan, although there will be a psychological ef-
fect upon the business community. Amman needs a pe-
riod of stability to build business confidence in
order to get the economy rolling again.
(continued)
Central Intelligence Bulletin
25X1
Approved For Release 2004/0 // $_,k -FP79T00975A019600060001-8
Approved For Release 2004//.}t8RC~RDP79T00975A019600060001-8
INDIA-YUGOSLAVIA: New Delhi has acceded to
:Belgrade's demand that trade beginning at the end
of 1972 be conducted in convertible currencies in-
stead of rupees. Delayed implementation will enable
India to liquidate Belgrade's rupee balances of the
equivalent of about $25 million by additional ex-
ports to Yugoslavia in 1972. India is concerned
that by agreeing for the first time to hard currency
trade with a socialist country, the way has been
opened for other East European countries to make
similar demands?
INTERNATIONAL MONETARY DEVELOPMENTS: The Mone-
tary Committee oftoie European communities (EC) last
week focused its attention on a recent US proposal
to the International Monetary Fund that the permis-
sible margins for exchange rate fluctuations be wid-
ened from one percent to two and a half or three
percent. The EC countries favor wider margins, ex-
cept among EC currencies, but disagree on how large
the margins should be. Germany and the Netherlands
would accept a substantial widening of the margin.
France, which earlier had indicated it would accept
an increase to only one and a half percent, is now
reported to be more willing to discuss wider margins
and floating exchange-rate arrangements. The Dutch
and the French insisted at the meeting that margins
should be widened only as one element of an inter-
national monetary reform package, such as that pro-
posed by the Netherlands. The Dutch reform package,
in addition to wider exchange-rate margins, includes
a three-percent devaluation of the dollar against
gold, a revaluation of some other currencies, agree-
ment by all countries to maintain stricter balance-
of-payments discipline, a US tightening of restric-
tions on.investment abroad and a more equitable bur-
den sharing of military and aid expenditures with
the US. It reportedly was approved "in principle"
by the Monetary Committee. 1 :1
27 Jul 71 Central Intelligence Bulletin 5
25X1
25X1
Approved For Release 2004/0 W., l*,f DP79T00975A019600060001-8
Secce-oved For Release 2004/03/18: CIA-RDP79T00975AO19600060001-8
Secret
Approved For Release 2004/03/18 : CIA-RDP79T00975AO19600060001-8