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December 14, 2016
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August 6, 2003
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December 27, 1972
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Approved For Release 2003/08/27 : CIA-RDP79T00975A0234Siet-7 25X1 DIRECTORATE OF INTELLIGENCE Central Intelligence Bulletin Secret N2 42 27 December 1972 Approved For Release 2003/08/27 : CIA-RDP79T00975A023400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 SECRET No. 0310/72 27 December 1972 Central Intelligence Bulletin CONTENTS USSR: Spending for defense, including military re- search and development, to increase moderately. (Page 1) USSR: Brezhnev's speech on domestic affairs. (Page 2) INTERNATIONAL COPPER: Copper-producing nations hope to force prices up. (Page 4) JAPAN: Tokyo encouraging foreign borrowing in Japan (Page 5) SWEDEN: Price freeze on food (Page 5) SECRET Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 SECRET USSR: Soviet spending for defense, including military research and development, is expected to increase moderately next year. The announced 1973 defense budget of 17.9 billion rubles--unchanged for the fourth year in a row--does not include a number of allocations normally associated with defense. The most sig- nificant exclusion is military research and de- velopment, which is funded principally from the science allocation. Science outlays have in- creased steadily for the past several years, and the 1973 allocation is seven percent greater than last year's spending. Based on observed Soviet force structure and programs, intelligence analysis projects a slight rise for 1973 in Soviet spending on deployed forces. Military research and development expenditures are expected to rise more rapidly. Total outlays for deployed forces and for research and development next year are expected to reach the equivalent of nearl $70 billion valued at 1970 US costs. 27 Dec 72 Central Intelligence Bulletin 25X1 SECRET Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 SECRET USSR: In the domestic portion of his speech saluting the USSR's 50th anniversary, General Secretary Brezhnev devoted primary attention to relations among the various Soviet nationalities. He also revived the promise of a new state consti- tution. Rendering the obligatory praise for the mutual benefits that all Soviet nationalities have derived from their union, Brezhnev nevertheless chose the occasion to warn bluntly of the dangers of persisting nationalistic tendencies that "interweave" with special local or regional interests. His Soviet audience would have no difficulty in recognizing this reference to recent developments in both the Ukrainian and Georgian republics. Brezhnev also referred frankly to "objective problems" that arise in attempts to achieve a balance between the in- terests of individual nationalities and the inter- ests of the Soviet Union as a whole. In the con- text of long-term (1976-1990) planning, he flatly stated that the task of enabling underdeveloped or "backward" republics to catch up economically has been completed "in the main," and that "now" Soviet planners can approach economic problems primarily from the view of the needs of the economy as a whole. Brezhnev also unveiled another "new" stage in Soviet development, declaring that the time is now ripe for a new constitution that would reflect the changes that have taken place in Soviet society since the present constitution was adopted in 1936. He said that the draft of the new version will be submitted for nationwide discussion before the next party congress, due to be held in 1976. A new So- viet constitution was one of Khrushchev's pet pro- jects that seemed too have fallen by the wayside since 1966 when Brezhnev last referred to it. (continued) 27 Dec 72 Central Intelligence Bulletin Approved For Release 2003/0 >727CCL - DP79T00975A023400130001-7 - Du O'L Approved For Release 2003/08/27 : CIA-RDP79T00975A023400130001-7 SECRET Brezhnev's remarks on the Soviet economy in- dicated once again that the goals set for the five- year plan would be difficult to achieve unless the entire population makes a major effort. He offered no new approach that might accomplish this mobili- zation, however. Although Brezhnev looked haggard and tired by the final day of the celebration, he delivered his three-and-one-half hour speech with vigor and appeared to have recovered from the illness that sidelined him during part of October and November. Central Intelligence Bulletin SECRET Approved For Release 2003/08/27 : CIA-RDP79T00975A023400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975A023400130001-7 SECRET INTERNATIONAL COPPER: The four major copper exporting countries wi attempt to develop joint action to force a substantial rise in world copper prices. tive e intergovernmental Council ofeCopperta- Exporting Countries (Chile, Peru, Zaire, and Zambia) will meet in London in early JanuarvF- The CIPEC countries account for more than 60 percent of the world's primary copper exports. Agreement on joint action at this time is un- likely, although. publicly there will probably be some expression of unanimity. CIPEC has held public meetings since the world copper price dropped in 1970, but it has been unable to agree to withhold copper from the market. Because the copper market is weak, such a program would require costly stock- piling or cutbacks in production, alternatives which conflict with member countries' national ob- jectives. CIPEC's most recent display of verbal solidarity occurred at a meeting in Santiago where they condemned legal actions taken by the Kennecott Copper Corporation against Chilean copper shipments. This pronouncement, however, did not prevent Peru and the African members from continuing to take advantage of Chile's discomfiture by arranging long-term sales contracts with Chile's European customers. Central Intelligence Bulletin 25X1 25X1 25X1 Approved For Release 200g/ A-RDP79T00975A023400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 SECRET JAPAN: Japan is emerging as an important source of international capital, partly as a re- sult of the government's policy of encouraging foreign borrowing in Japan. The net long-term capital outflow this year will exceed $4 billion, compared with only $1.2 billion last year. In recent agreements, one Japanese banking syndicate will provide Brazil with $200 million and another will market $60 million worth of debentures in Japan for the Ford Motor Company. The easing of restrictions on capital outflows is part of the government's effort to cope with Tokyo's very large trade surplus and rowing supply of dollars. SWEDEN: In response to growing dissatisfac- tion over rapidly rising food prices, the govern- ment will institute a price freeze on selected food products on 1 January. With the government set to stimulate the slowly growing but highly inflationary economy, this action may be pre- liminary to a general price freeze. In 1970 a similar price freeze on food was followed by a general price freeze. If the ruling Social Demo- crats are to quell increasing public discontent over the economic situation, prices must be con- tained while the economy expands. Prime Minister Palme's handling of the economy has come under increasing criticism and could hurt the party in the elections next September. Central Intelligence Bulletin 25X1 SECRET Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7 Secret Secret Approved For Release 2003/08/27 : CIA-RDP79T00975AO23400130001-7