CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A021400030001-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 15, 2016
• Document Release Date: September 10, 2003
• Sequence Number: 1
• Publication Date: March 9, 1972
• Content Type: REPORT

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DIRECTORATE OF
INTELLIGENCE
Central Intelligence Bulletin
Secret
N? 41
State Department review completed
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No. 0059/72
9 March 1972
Central Intelligence Bulletin
LAOS: Additional North Vietnamese equipment being
moved closer to Long Tieng. (Page 1)
USSR-LIBYA: Assessment of Deputy Premier Jailud's
visit. (Page 2)
EUROPEAN COMMUNITIES: Decision to move toward eco-
nomic and monetary union. (Page 4)
IRAN - WEST GERMANY: Brandt visit achieves limited
success. (Page 6)
ARGENTINA: Cabinet reorganization does not signal
policy changes. (Page 7)
CZECHOSLOVAKIA: New jet trainer enters production.
(Page 9)
CHAD: Muslim rebels are receiving new arms supplies.
(Page 11)
CYPRUS: Situation report (Page 13)
CUBA: Trade agreement with Communist states
(Page 13)
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YUGOSLAVIA: Price adjustments (Page 14)
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LAOS: PLAINE DES JARRES AREA
0 Miles 10
?Government-held location
*Communist-held location
& Highpoint
Muong Sour
llnia Tam BIe
*Muong Pot
Irregulars advate
Pho Din
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Bouam Lo
Khang Khay
Xienl
Khouangvill
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C LAOS: The North Vietnamese appear to be moving
additional equipment and large quantities of sup-
plies closer to the Long Tieng - Sam Thong area.
US pilots report sighting tanks less than four
miles from Sam Thong; the intervening terrain is
easily negotiable for tanks, and a road connects
Sam Thong with Long Tieng. Pilots also report that
North Vietnamese field guns have been brought for-
ward at least as far as Tha Tam Bleung.
The government has used the time bought by Vang
Pao's offensive to strengthen its position at Long
Tieng. Moreover, Vang Pao has recently launched a
small harassing operation northwestward along the
Pha Dong ridge toward Phou Pha Sai, which overlooks
the new Communist supply route from the Plaine. The
North Vietnamese are reacting sharply to this move,
and advanced irregular-units have taken substantial
casualties.
9 Mar 72 Central Intelligence Bulletin
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USSR-LIBYA: The Soviet presence in Libya may
increase as a result of Deputy Premier Jallud's
ten-day visit to the USSR, but political differences
between the two states remain.
On 4 March, Jallud's final day in Moscow, the
Soviets announced that they had signed an economic
and technical agreement to assist in extracting
and refining Libyan oil. The agreement also calls
for assistance in exploiting Libyan minerals and
gas, and equipping and training Libyan technicians.
A small team of Soviet oil experts has been in Libya
since 1970, but the new agreement may require addi-
tional personnel.
Libyan President Qadhafi has been reluctant to
employ Soviet advisers, and implementation of the
accord will depend on whether he clings to this
view. Tripoli is concerned about the level of oil
reserves available to the oil industry, however,
and may be ready to use Soviet personnel for ex-
ploratory and development work in areas held by the
Libyan state oil company. The Libyans also may
hope to trade some of their oil for Soviet services.
Several days after Jallud's departure from the
USSR, the Soviets and Libyans released separate
communiques that reflect the differences between
them. Whereas the Libyan communiquee called for the
closing down of all "military" bases in the Mediter-
ranean (the terminology used in the Soviet-Algerian
communique last year), the Soviet document referred
only to "imperialist" bases. Neither mentioned
Soviet military assistance to Libya, which may have
been one of Jallud's reasons for undertaking the
trip.
In addition to issuing separate communiques,
both sides gave very little media coverage to the
visit and continue to be critical of each other in
9 Mar 72 Central Intelligence Bulletin
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public statements. On 23 February, the day of
Jallud's departure for Moscow, for example, the
Libyans criticized the Soviet-Iraqi friendship
treaty, which may be signed later this year, and
on 5 March the Soviets castigated the Libyan press
for trying to drive a wedge between the USSR and
the Arab states. Thus, the Jallud visit marks an
upgrading of the Soviet-Libyan dialogue, but the
discussions probably will continue to be heated as
long as Libyan President Qadhafi is unwilling to
temper his op osition to Soviet policies in the
Middle East.
9 Mar 72 Central Intelligence Bulletin 3
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TEUROPEAN COMMUNITIES: The EC Council's deci-
sion to resume progress toward economic and monetary
union has important implications for further develop-
ment of the community.
The agreement in Brussels provides for a narrow-
ing by 1 July of the margin of fluctuation among the
community currencies while they move as a group
within a wider band vis-a-vis the dollar. Initially,
the EC central banks will intervene in the market to
maintain the agreed 2.25-percent intra-EC spread,
but the Council will decide by the end of 1972
whether to establish a stabilization fund for this
purpose.
Reducing the intra-EC spread to 2.25 percent
by 1 July could prove difficult. The spread re-
cently has been in the neighborhood of three percent.
Moreover, prospective business trends in the EC
countries suggest little tendency toward reducing
this disparity. However, should short-term capital
begin to flow out of West Germany, Belgium, and
the Netherlands in response to renewed confidence
in the dollar and interest-rate changes, the dollar
prices of these countries' currencies would tend to
decline and thus reduce the intra-EC disparity.
Further revaluations or devaluations are not ex-
cluded by the new EC arrangements. They clearly
are not desired, however.
A new mechanism to coordinate short-term eco-
nomic policies was also set up and member states
are to consult with the community before adopting
any measures which deviate from its guidelines. A
directive establishing a community framework for
national measures to control disruptive interna-
tional capital flows was adopted. Largely at the
insistence of Italy, arrangements for increased com-
munity aid for regional development were sanctioned.
The Council agreed to give priority consideration to
promoting community tax harmonization and progress
toward a European capital market
Central Intelligence Bulletin
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The agreed institutional arrangements are a
compr""om'ise between the French who favor "inter-
state" mechanisms and others who want to preserve
the existing Commission and. its "dialogue" with the
Council as the mainspring of community action. The
mechanism for policy coordination, in particular,
appears unwieldy. Nevertheless, its operation, how-
ever inefficient, implies in principle further sub-
stantial restraint on the freedom of the member
states to make their own economic policies.
Agreement was made possible by a prior under-
standing between Paris and Bonn, and by the apparent
desire of the finance ministers to act without wait-
ing for the Council meeting, which the foreign min-
isters will attend next week. Dissatisfaction with
current US monetary policies probably also played
a role in forging the "common front." I-- I
9 Mar 72 Central Intelligence Bulletin 5
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WGET
IRAN - WEST GERMANY: Chancellor Willy Brandt's
official visit to mend Iranian-German relations
achieved some limited success but fell short of
Iranian expectations.
According to a joint communique issued at the
conclusion of Brandt's visit on Wednesday, the two
governments have agreed to form a joint government
commission for the promotion of trade and economic
and technological cooperation. The communiqu? also
said that the two sides pledged to maintain and
strengthen their "traditionally good relations."
Iran had hoped to come away with an economic aid
package.
Relations between the two have been strained
in recent years. Student and leftist groups in
West Germany, often prompted by expatriate Iranian
students there, have staged anti-Iranian demonstra-
tions in several German cities protesting the Shah's
"autocratic" rule. In addition, West German Presi-
dent Heinemann made what the Iranians construed as
anti-Shah remarks prior to the 2,500th anniversary
celebrations last fall.
West Germany and Iran have an interest in keeping
their relations on an even keel. Germany is Iran's
biggest customer; Iran is Germany's second largest
Asian market and is looked to as an increasingly
important source of oil. Tehran has a continuing
requirement for German investment capital, techno-
logical know-how and markets for its expanding
ex
Central Intelligence Bulletin 6
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ARGENTINA: President Lanusse's cabinet re-
organization does not appear to signal any major
policy changes.
Four of the 12 ministerial resignations given
to the president last Thursday have been accepted,
but the key interior and finance ministers have
been confirmed in their posts. Lanusse named rela-
tive unknowns to the ministries of commerce and
industry, and he will fill the defense and agricul-
ture portfolios later.
The retention of Interior Minister Mor Roig
and Minister of Treasury and Finance Licciardo
suggests that Lanusse plans no more than minor
adjustments in his political and economic policies
in the near future. Lanusse's economic policies,
in particular, have come under attack as inflation
continues to mount, but he probably hopes that the
retention of Licciardo will reassure Argentina's
foreign creditors, who are considering new loans
to support the current economic reform program.
9 Mar 72 Central Intelligence Bulletin 7
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Czech L-39 Entering Production
Length ................ 40 feet
Span .................. 30 feet
Speed ................. 395' knots
Radiiis .................400 nautical miles
Length ... 35 feet
Span ..... 34 feet
Speed .... 350 knots
Radius . . . 180 nautical miles
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CZECHOSLOVAKIA: The new Czechoslovak L-39 jet
trainer is entering production at the Aero airframe
plant in Vodochody.
The L-39 is a successor to the L-29 that is in
service in large numbers with Communist and non-
Communist countries, mainly as a basic jet trainer.
The L-39 is an entirely new design incorporating
structural and performance improvements. The Czech-
oslovaks have built about 4,000 L-29s since 1963,
and production probably will be phased out as L-39
production increases. Czechoslovak officials have
stated that some 500 L-39s are to be produced by
1975, with 300 slated for use by the USSR and the
remainder by the Czechoslovak and East German air
forces.
Versions of the L-39 that are capable of
carrying cannons, rockets, missiles, and bombs may
eventually also be produced for export and use by
Warsaw Pact air forces as a light ground attack
fighter.
9 Mar 72 Central Intelligence Bulletin 9
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ort-Lamy . Mangalme
Mongo'
# aroua
Lai Fort-
GarOUk{;,Archambault
CAMEROON
Moundou Dote
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Birao'
CENTRAL AFRICAN
REPUBLIC
Ouadda
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AD. President Tombalbaye and the French are
concerned about the new arms supplies reaching Mus-
lim rebels in east and central Chad.
Insurgency first broke out in this region in
1965, but by early last year rebel activity had been
significantly reduced with the aid of French mili-
tary operations and Chadian Government negotiations
with local tribes. In recent weeks, however, new
arms caches have been uncovered; French and Chadian
authorities believe the arms came from Libya via
Sudan. In addition, three French helicopters have
been downed by rebel groundfire, causing the first
significant French casualties in over a year.
The French Government is anxious for domestic
reasons to forestall a major flare-up of the in-
surgency, and it has sent a 120-man special unit
to supplement the 2,170 troops and advisers it is
maintaining in Chad. The unit's mission will be
to train Chadian forces to conduct interdiction
patrols along the Chad-Sudan border. Tombalbaye
seems to be getting cooperation from the Sudanese
Government, with which he has established friendly
ties. Khartoum's press announced on 3 March that
security forces will prevent Sudan from being used
as a base against Chad. Subsequently, Khartoum re-
portedly ordered all armed Chadians expelled from
the country. Nevertheless, Sudanese ability to
control the situation along its borders with Chad
is doubtful at best.
There is little doubt that Libya is behind the
arms traffic. Since relations with Chad were severed
last summer, the Qadhafi regime has openly supported
the rebels and has given official recognition to
the principal rebel group. The Libyans reportedly
are providing training and support facilities for
anti-Chadian rebels and are said to have establis
logistical bases along the border, intended'in part
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to serve the rebels. Libya and Chad are engaged in
continuing and acrimonious propaganda warfare, and
there is no sign that the Libyan leadership will
give up a campaign that it sees as an obligation
to assist fellow Muslims under oppression. I
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NOTES
CYPRUS: Archbishop Makarios probably will re-
spond soon to his Bishops' request that he resign
as president. In a recent conversation with a Ca-
nadian official, Makarios acknowledged that the
Bishops' request had put him in a difficult position.
It appears that Makarios will deal with this new
threat to his leadership before replying formally
to the Greek demarche of 11 February, despite Athens'
renewed pressure for an immediate response. Specu-
lation continues that he will resign. Meanwhile,
demonstrations for and against the Archbishop are
continuing. Yesterday, 4,000 to 5,000 students
marched through Nicosia, presumably in answer to
smaller anti-Makarios student demonstrations the
previous day. So far, there have been no serious
clashes, but in the tense atmosphere, a minor inci-
CUBA: With the signing of the Chinese trade
protocol on 4 March, Havana has concluded trade
agreements for 1972 with all its Communist trading
partners. In contrast with past years, press an-
nouncements have contained little information on
the over-all levels of trade and aid. The absence
of such detail supports the view that trade with
Communist countries probably will fall somewhat
below the estimated $1.5 billion registered last
year. Most of the expected decline will be re-
flected in lower Cuban exports to those areas re-
sulting from this year's poor sugar crop, and im-
ports from Eastern Europe and China may also drop.
Abnormally high prices on the world sugar market,
however, will enable Cuba to increase its earnings
and purchases in trade with the non-Communist
world. Total Cuban exports and'imports, therefore,
will be at about their 1971 levels of $825 million
and $1.4 billion, respectively, with the $600-mil-
lion deficit largely made up by the USSR.
Central Intelligence Bulletin
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(continued)
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YUGOSLAVIA: Recent price adjustments have
clouded prospects that the government will be able
to limit price rises this year to the planned five
percent. Increases in turnover taxes have resulted
in large price hikes for coffee and gasoline, key
consumer items. These follow increases last week
in the price of several food products, including
edible oil, milk, and other dairy products. A
high-level Yugoslav official has pointed out that
such administrative juggling of prices will do
little to improve the price structure or pros ects
for creating more stable market conditions.
9 Mar 72 Central Intelligence Bulletin 14
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Secret
Secret
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