CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A027100010022-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 20
• Document Creation Date: December 21, 2016
• Document Release Date: May 3, 2006
• Sequence Number: 22
• Publication Date: April 19, 2000
• Content Type: REPORT

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National Intelligence Bulletin
ARAB STATES - ISRAEL
October 31, 1974
Egyptian President Sadat appears to have ruled out
a step-by-step approach to negotiations with Israel.
In a press conference on his return from Rabat yes-
terday, Sadat seemed to deny that Egypt had ever con-
sidered further disengagement in the Sinai as the next
step in negotiations with Israel and said, "Withdrawal
must be on all fronts." Sadat insisted, however, that
the decisions of the Arab summit had not impaired
Egypt's freedom of action.
Sadat will meet with Syrian President Asad, Jor-
danian King Husayn, and PLO chairman Arafat next week,
possibly in Amman. In back-to-back press conferences
in Rabat, Arafat and Moroccan King Hassan told newsmen
that the four Arab leaders would meet to discuss strat-
egy in accordance with one of the resolutions adopted
at the summit conference. The Egyptian minister of in-
formation reportedly confirmed that a date has been
fixed for such a meeting.
In his remarks, Arafat refused to say whether the
PLO would now form a government in exile or agree to
attend the Geneva peace conference. Members of the ex-
tremist Palestinian commando groups, known collectively
as the "Rejection Front," reportedly have issued a
statement of their own in Rabat criticizing the "com-
promise" reached between Arafat and King Husayn and have
called for Husayn's overthrow.
Although Husayn was disappointed with the outcome
of the summit, he gave every indication in a speech on
his arrival back in-Jordan yesterday that he would at
least go through the motions of upholding the decisions
reached at Rabat. He pledged support for the Palestin-
ian cause and said Jordan would continue for the pres-
ent to provide material aid and services to West Bank
inhabitants; Jordan pays the salaries of West Bank civil
servants.
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National Intelligence Bulletin
October 31, 1974
The Israeli government has reacted cautiously to
the Rabat summit decisions. Prime Minister Rabin re-
portedly told his Labor Alignment Knesset faction on
Tuesday that the government would make a painstaking
examination of the summit's decision. He said, however,
that the outcome of the meeting was bad news for Israel,
and hinted that it would complicate a Middle East settle-
ment. He reiterated the standard line that the govern-
ment would not deal with organizations whose declared
policy is the destruction of Israel.
Israeli press commentary has been extensive and
predictably negative.
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National Intelligence Bulletin
October 31, 1974
CONTENTS
SOUTH VIETNAM: Internal situation. (Page 1)
USSR - WEST GERMANY: Moscow and Bonn seem satisfied
with results of Brezhnev-Schmidt meeting. (Page 5)
SOMALIA-USSR: Details of friendship treaty published.
(Page 7)
GREECE-TURKEY: Trans-Aegean flights virtually par-
alyzed by dispute over sovereignty. (Page 12)
MALTA: Mintoff to seek republic status. (Page 13)
EC: Beginning next year, EC Commission will have
to negotiate new trade agreements with the USSR and
Eastern Europe. (Page 14)
CHINA: Canton Fair attracts fewer foreign business-
men. (Page 15)
CHILE: Food import bill still high, despite im-
proved agricultural output. (Page 17)
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National Intelligence Bulletin October 31, 1974
SOUTH VIETNAM
The immediate aim of yesterday's replacement of
three of President Thieu's four regional commanders is
to take the sting out of anticipated antigovernment
demonstrations during National Day on November 1. The
longer range intent is to dampen rising political opposi-
tion., Thieu's strong action points to genuine concern
that the corruption issue could serve as the catalyst
for a further buildup of ferment.
Catholic anti-corruption forces last night staged
a torchlight parade in Saigon. Press reports indicate
that Saigon police units have attempted to restrain fur-
ther demonstrations which
included a planned march this morning on the presidential
palace Several' injuries to demonstrators and police
have been reported. Police are said to have sealed off
the downtown area and imposed a 24-hour curfew. Accord-
ing to earlier press reports, police yesterday raided
the Saigon press club and arrested some 50 persons ready-
ing a demonstration against censorship.
Buddhist leaders have informed government author-
ities that their activities will be limited to speeches
in Saigon and seminars in the provinces. Radical fringe
elements, such as Madame Ngo Ba Thanh's movement, can
be expected to participate in the action. A prominent
labor leader has also joined the ranks of Thieu's critics,
but there is no indication that union members will demon-
strate against the government during the holidays.
Buddhist and Catholic dissidents may find themselves
at cross purposes during the holiday, which commemorates
the overthrow of the Diem regime in 1963. The Buddhists,
who were largely responsible for Diem's downfall, tradi-
tionally use the holiday to denounce the former regime.
The Catholics, however, revere Diem and usually offer
day-long prayers for the former'president.
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National Intelligence Bulletin
October 31, 1974
General Duong Van "Big" Minh, the leader of the Diem
coup, will also address the Buddhist meeting in Saigon
and reportedly will denounce the current government's
"Diemist style" of administration. Such a denunciation
is not likely to sit well with the Catholics and could
make future cooperation between Catholic and Buddhist
dissidents even more unlikely.
The President had warned two of the outgoing com-
manders several months ago that they would be sacked
if they did not put down corruption in their regions.
Thieu probably judges that the need to blunt the mount-
ing demonstrations allows him to replace the four com-
manders without jeopardizing vital support of other
senior officers.
The new commanders of regions 2, 3, and 4 have no
record of corruption, and two of them have reputations
as excellent field commanders. General Phu, who will
take over the command of Military Region 2, earned high
marks during the Communist Easter offensive in 1972 when
he commanded the lst Infantry Division in Military Region
1. General Nam, the new delta chief, has established his
combat credentials as commander of the 7th Division, re-
garded as the delta's best combat unit.
The new commander of the politically sensitive com-
mand around Saigon apparently was selected more for his
political reliability than for his combat experience.
General Du Quoc Dong has held sensitive positions in the
Defense Ministry and as head of South Vietnam's delega-
tion to the Four-Power Joint Military Commission in
Saigon established under the cease-fire agreement.
Three new division commanders also were appointed,
and other changes are likely. There are rumors that
several province chiefs will be replaced soon, but Thieu
may wait to get the opinions of his new re Tonal com-
manders before deciding.
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National Intelligence Bulletin October 31, 1974
USSR - WEST GERMANY
Moscow and Bonn appear satisfied with the results
of the meetings between General Secretary Brezhnev and
Chancellor Schmidt in the Soviet capital this week.
West German officials say that in the private conver-
sations, both leaders expressed their determination to
continue the relationship established in the Brandt era.
The focus of the talks was on economic matters.
As he had with other Western leaders, Brezhnev advocated
cooperation on long-term projects, some to run 20 years
or longer. Schmidt expressed West German interest in
enlarging trade and economic cooperation but coupled
this with a firm refusal to offer governmental credits
to the USSR. He advised the Soviets to explore commer-
cial credit possibilities.
Among specific projects discussed were the deliv-
ery of German pipe for Soviet gas, a three-country con-
tract for the delivery of gas from Iran via the USSR,
and the possibility of Wiest German firms building a nu-
clear power plant in the USSR. Yesterday, the two coun-
tries signed a five-year agreement on economic coopera-
tion similar to the one recently concluded between the
USSR and France. General political topics were treated
in routine fashion.
The question of Berlin came up several times, and
the Soviets insisted they would not tolerate any in-
fringement of the Quadripartite Agreement, Toward the
end of the visit, however, they agreed to some procedu-
ral adjustments that will allow residents of West Berlin
to participate in bilateral exchanges between the USSR
and West Germany". In general, however, the Soviets
sought to avoid specific concessions on Berlin matters.
Moscow had viewed the Schmidt visit essentially
as a way of assessing his willingness to continue ost-
politik. The positive, if undramatic, tone of public
and private statements after the meetings suggests Mos-
cow was .satisfied.
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National Intelligence Bulletin October 31, 1974
SOMALIA-USSR
Pravda yesterday published the text of the Soviet-
Somali friendship treaty signed last July. Publication
occurred just one day after Somalia apparently had com-
pleted ratifying the treaty.
Article 4 of the 20-year treaty--the text is not
yet available in Washington provides for Soviet assist-
ance in training Somali military personnel in the use of
Soviet-supplied arms and equipment. No reference is
made to Soviet military use of Somali facilities, and
the accompanying Pravda commentary blasted Western press
"conjectures about mythical Soviet military bases on
Somali territory."
Mogadiscio's delay in ratifying may have stemmed
from internal disagreements over whether Somalia had re-
ceived enough in return for concluding the treaty. The
Somalis also could have been dragging their feet in
order to ensure that Moscow would comply with the prom-
ises of military aid and economic concessions it a ar-
ently had made to induce signature of the treaty.
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National Intelligence Bulletin October 31, 1974
GREECE--TURKEY
The dispute between Athens and Ankara over sover-
eignty and air traffic control rights in the Aegean has
led to virtual paralysis of military and civil trans-
Aegean flights during the past three months.
Greek civil and military aircraft still continue to
fly to the eastern Aegean in defiance of Ankara's attempt
to extend its flight control area, but international
civil aviation flights and US military flights are not
operating in the disputed zone- Since Greece retains
nearly unrestricted access to all desired airfields while
Turkish air routes to and from the West are compelled to
bypass the Aegean, the situation is beneficial to the
Greeks and they may maintain their position on the issue
for some time.
Early in August the Turks issued a Notice to Airmen
(NOTAM) requiring that all aircraft transiting the east-
ern half of the Aegean and a substantial part of the
northeastern Mediterranean do so under supervision of
Turkish air traffic control centers rather than those
manned by Athens or Nicosia. Behind this move apparently
was Ankara's hope of establishing an air defense infor-
mation zone. Athens retaliated by issuing a NOTAM declar-
ing the Turkish NOTAM invalid.
Athens views Ankara's efforts to extend its air
control authority as being directly linked to Turkish
claims to potential mineral deposits in the Aegean sea-
bed. It therefore will not reopen the traditional air
corridor between Greece and Turkey until Ankara cancels
its August NOTAM, although this corridor skirts rather
than passes through the disputed area,
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National Intelligence Bulletin October 31, 1974
Prime Minister Mintoff announced to a Labor Party
audience on October 27 that he intends to make Malta a
republic as part of his long-heralded plan to revise the
1964 constitution. He also said that the head of the
government should be an elected president, not the
British Queen. The Queen is represented in Malta by a
governor general.
This move, the subject of public discussion for
some months, has met with little opposition and has a
better than even chance of winning the referendum and
parliamentary approval. In negotiations between Mintoff's
Labor Party and the opposition Nationalists over revision
of the constitution, the debate has centered mainly on
other questions such as church-state relations and the
electoral system.
UK-Malta relations have been stable during recent
months. Mintoff has even shown concern that the British
defense review may result in the withdrawal of the 2,600-
man British military contingent.
In the three years since Mintoff has been prime
minister, the country has steered an independent,. non-
aligned course. If Malta achieves republic status, it
will have a negligible effect on relations with Britain
and its foreign policy in general,
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National Intelligence Bulletin October 31, 1974
The EC has largely completed its plans for regulat-
ing the nine members' trade with the USSR and East Euro-
pean countries after the community's common commercial
policy comes fully into force on January 1, 1975. After
that date, new trade agreements will have to be negoti-
ated by the EC Commission on behalf of the community
with each of the eastern states.
The EC Commission's model trade agreement to be of-
fered to individual Communist countries after January
is now being reviewed by the Committee of Permanent
Representatives, and the Council is expected to give
final approval at its session on November 11. The model
agreement will contain provisions for joint consultations,
improvement of facilities for promoting trade, and a
general statement about credit terms. It will further
provide that the parties accord each other most-favored-
nation treatment. A remaining problem with the model
trade agreement is the question of including a general
clause giving the EC jurisdiction over industrial coop-
eration agreements. The French seek to restrict the
Commission to negotiating only on commercial matters.
The Commission intends to underscore the EC's de-
termination to negotiate agreements with the individual
Communist nations rather than within the CEMA framework,
which the Soviet Union dominates. Accordingly, before
accepting CEMA's invitation for talks in Moscow on EC-
CEMA relations, the Commission will send the model agree-
ment to all Communist countries--except possibly China--
with which EC members currently have bilateral agree-
ments. A decision on Peking apparently has not yet been
reached.
The Soviets, meanwhile, both before and during the
October 15-18 sessions of the West German - Soviet joint
economic commission made an extremely strong pitch for
an extension of their bilateral trade agreement. After
Bonn refused, Moscow went so far as to threaten a pos-
sible disruption of economic relations with Western
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National Intelligence Bulletin October 31, 1974
Europe unless the EC backed down on its policy of grant-
ing the Commission responsibility for determining trade
policy with the Communist states.
The Commission has long recommended that the coop-
eration agreements, which have assumed considerable im-
portance in recent years, be included under the common
commercial policy, but has so far only won acce tans
for their review at the community level.
As a result of economic problems at home and dis-
appointment with the spring fair, foreign businessmen
have arrived at the fall Canton Fair in fewer numbers
and with limited buying power. The Chinese are stress-
ing exports at the fair--prices are generally lower,
more Chinese goods are available, and negotiations are
proceeding more expeditiously than at the spring fair
this year.
The US contingent is about the same size as at the
spring fair and again is largely made up of import firms.
Several major US firms including Burroughs, 3-M, Coca-
Cola, and Kodak are exploring the long-term trade poten-
tial with China. Peking has reiterated its interest in
doing business with US firms, while reminding business-
men of the importance of most-favored-nation status
for US-China trade.
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National Intelligence Bulletin
CHILE
October 31, 1974
Chile's net agricultural import bill probably will
reach $400 million in 1975, only $200 million below this
year's level, despite some improvement in output.
Production of most food crops is likely to improve
markedly next year. Santiago will be unable to make
greater cuts in food imports, however, because prospects
for the current wheat crop are poor. A recently con-
cluded $17,1-million US credit for PL-480 wheat pur-
chases will cover about 10 percent of next year's wheat
import requirements.
High world wheat prices and Chile's deteriorating
balance-of-payments position is forcing Santiago to seek
additional credits for wheat imports. The junta recently
requested another $17 million in PL-480 credit from the
US. Chile's trade deficit in 1975 will probably increase
sharply from this year's estimated $300 million. Export
earnings from copper are likely to drop because of the
plummeting world price of copper. At the same time,
Santiago will find it difficult to cut imports; in addi-
tion to large foodstuff purchases, greater imports of
petroleum will be required to offset falling domestic
output
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