CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R000800020017-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 16
• Document Creation Date: December 19, 2016
• Document Release Date: January 15, 2002
• Sequence Number: 17
• Publication Date: January 21, 1972
• Content Type: BULL

APproved For,ReIease 20D5V06/09 i C1A fitDF8$T00875ROY10800020017-0. '
.
?t.a.?; .. f< to ~ "I" L ,. ~ t.? t+ ~w ?t.~'t
ut: .. _?f '
,. -.d 5
f ? ':a nn -:~?.. ?f ?i m ?i?. i 1?? `.. ?f ? .~ ?n ?' .n - u.~ ? l t'. t i.' \
1 ttt ~_:; f ftt.i.: fr . f ff fta
f'.Gi S f ? tif~~7 ,~+ ~. j f ! at.~ ..?~, t f. +?'~?`~ T-4 . ~? 9 i? f 2
.
 9 U c/ c.~.4
Approved For Release 2005/06/09 : CIA-RDP85T00875R000800
DIRECTORATE OF
INTELLIGENCE
w
No Foreign Dissem
Central Intellzence bulletin
State Dept. declassification & release instructions on file
Secret
N2 592
21 January 1972
Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
 Approved For Release 2005/06 %8f DP85T00875R000800020017-0
The CENTRAL INTELLIGENCE BULLETIN is produced by the
Director of Central Intelligence to meet his responsibilities for providing
current intelligence bearing on issues of national security to the President,
the National Security Council, and other senior government officials. It
is produced in consultation with the lief ?trtments of State and Defenst.
When, because of the time factor, adequate consultation with the depart-
ment of primary concern is not feasible, items or portions thereof are pro-
duced by CIA and enclosed in brackets.
Interpretations of intelligence information ire this publication represent
immediate and preliminary views which are subject to modification in the
light of further information and more complete analysis.
Certain intelligence items in this publication may be designated specifically
for no further dissemination. Other intelligence items may be disseminated
further, but only on a need-to-know basis.
WARNING
This document contains information affecting the national
defense of the United States, within the meaning of Title
18. sections 793 and 794, of the US Code, as amended.
Its transmission or revelation of its contents to or re-
ceipt by an unauthorized person is prohibited by law.
GROUP 1
Excluded from automatic
downgrading and
declassification
Approved For Release 2005/0 ~~C z DP85T00875R000800020017-0
 Approved For Release 2005/0 - owtIDP85T00875R000800020017-0
No. 0018/72
21 January 1972
Central Intelligence bulletin
LAOS: Long Tieng situation remains unchanged. (Page 1)
USSR-BANGLADESH: Soviet recognition may soon be
for. thco:ning. (Page 2)
25X1 X
ISRAEL: New budget will reinforce inflationary pres-
sures. (Page 4)
EGYPT: Assessment of new austerity measures. (Page 5)
PERU: President Velasco expresses concern about
Chilean regime. (Page 6)
BOLIVIA: President Banzer suspects plotting by sen-
ior military officers. (Page 7)
ITALY: Labor reacts favorably to new plan for eco-
nomic recovery. (Page 8)
SPAIN: Assessment of student demonstrations. (Page 9)
SOUTH-WEST AFRICA: Mineworkers' strike poses di.:.(
lemma for government. (Page 10)
EUROPEAN COMMUNITIES: Debate on aircraft policy.
Page 11
Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
SECRET
 Approved For Release 2005/0~W96RIf DP85T00875R000800020017-0
L?L -TO Q fij-UROE
)GOaernent-hold location
munist-held location
0 co,
A Iligti oint
0 ~5
Mlles
13 Dong
( I ~.
l H'tr1 1 / pPono
?avan kh~.I
urH
Khang Kho
P ?1913 Sal
CONVIDENTDAL
552457 1-72 CIA
Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
SECRET
LAOS
l~
Dan I(and i
IJfVBflliliilil. t; rit'line
.-Pak?oj n
A Oolovons ,.i
1~, Platcnu r;
Cpnn Na
MAT
LONG
PNOU
PLA/N
/
DES
(D"', uOnF Pot
i
JARUES
ciha Trim F)loung
M uong
1hor-
 Approved For Release 2005/06/0~1485T00875R000800020017-0
LAOS: There has been no appreciable change in
the situation around Long Tieng.
The Communists have resumed shelling irregular
positions on Skyline Ridge with 130-mm. field guns,
but no reports of damages or casualties are yet
available. The North Vietnamese are also keeping
up a steady stream of mortar, recoilless rifle,
and small-arms fire on the ridge, causing numerous
irregular casualties--three killed and 24 wounded
in the past 24 hours--and making it difficult for
irregular units to mass for a new thrust eastward.
Elsewhere in the Long Tieng area, irregular pati:ols
continue to report growing enemy troop concentra-
tions west and southeast of the base.
In south Laos, the North Vietnamese are main-
taining pressure on government forces on the pe-
riphery of the Bolovens Plateau. Lao Army units
in forward positions along Route 23 have reported
frequent shellings and probes over the past several
days, but the Communists have pushed no closer to
Pakse. The Communists are also attacking along
Route 231 about 15 miles north of Route 23. (CON-
FIDENTIAL)21
21 Jan 72 Central Intelligence Bulletin
- : , C I A - RDP
V
Approved For Release
7-0
 Approved For Release 2005/06/09 c,L \-JRp 5T00875R000800020017-0
USSR-BANGLADESH: Formal Soviet recognition of
Bangladesh, which Moscow hopes to accomplish with-
out rupturing its relations with Islamabad, may soon
be forthcoming.
Moscow's fear of losing its position in Islama-
bad and its desire not to appear too far out in
front of the lest of the world have been the primary
reasons for Soviet delay thus far. Recently, how--
ever, the countries of the European Communities and
Britain have decided on the desirability of according
nei;;r simultaneous recognition of Bangladesh, possibly
as early as next week. In addition, Islamabad has
not broken diplomatic relations with every country
that has recognized Bangladesh. The Soviets prob-
ably feel that this augurs well for their own pros-
pects of being able to maintain their presence in
Islamabad. They may also hope to score points in
New Delhi and Dacca by being among the first of
the major powers to recognize the new regime. (CON-
FIDENTIAL NO FOREIGN DISSEM)
Central Intelligence Bulletin
Approved For Release 2005/06/0 % F $5T00875R000800020017-0
 25X1X Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
 Approved For Release 2005/06/0$3fJf@ 85T00875R000800020017-0
ISRAEL: The government budget approved by the
cabinet for the fiscal year beginning 1 April will
reinforce already formidable inflationary pressures.
The budget of $3.95 billion exceeds the ex-
penditure ceiling announced previously by Finance
Minister Sapir. About $155 million of the projected
spending will b3 borrowed from the central bank.
The announced expenditure total may not include $83
million in military outlays previously labeled as
a "borrowing from the 1973-74 defense budget."
Moreover, the cost of approved programs apparently
has been calculated on the basis of an unrealisti-
cally low estimate of wage increases, suggesting
that a supplementary appropriation will be required
later.
After allowance is made for price increases,
however, the new budget represents little change
from the current level of government activity. De-
fense spending, which had risen sharply in recent
years, is to be reduced from the current year's
level.
The budget is to be presented to the Knesset
on 22 February. This will not leave sufficient
time for enactment of the required legislation be-
fore the beginning of the new fiscal year, and an
interim budget will be enacted to cover the months
of April and May. (CONFIDENTIAL)
Central Intelligence Bulletin
Approved For Release 2005/06/0.L'&A3R%'85T00875R000800020017-0
 Approved For Release 2005/06/09 S c j -E , fI T00875R000800020017-0
EGYPT: The austerity measures announced by
the new idgi cabinet apparently are designed to
underscore President Sadat's determination to
"mob.lize" the domestic front. The timing of the
announcement may reflect in part a desire to re-
spond to recent student protests.
Measures announced thus far are aimed mainly
at simultaneous reduction of current state expend-
itures and of the privileges of upper-echelon civil
servants. Cairo has imposed cuts ranging from 20
to 50 percent on many of the administrative expenses
of ministries, public utilities, and state enter-
prises; the largest reductions will affect travel
and entertainment expense accounts. Specific meas-
ures outside the government sphere have not been
made public, but an effort to reduce luxury goods
imports further is expected.
The impact of the new expenditure restrictions
on the state deficit cannot yet be assessed. During
the post-war years the government has generally
claimed to have balanced the state budget, but re-
cently the achievement has been mainly the result
of fiscal sleight of hand. Up to $200 million
probably has been borrowed annually since 1969 to
finance the deficit in the unbudgeted post-war
emergency fund. (CONFIDENTIAL)
21 Jan 72 Central Intell~~,ence Bulletin
Approved For Release 2005/06/08ECJ 3 '85T00875R000800020017-0
 Approved For Release 2005/06/09: Il -RP1 5T00875R000800020017-0
PERU: President Velasco has expressed serious
concern about the Marxist regime in Chile, but his
government continues to work with the Peruvian Com-
munists in support of domestic objectives.
In a conversation this week with the US ambas-
sador, Velasco stressed his government's preoccupa-
tion with danger from Chile, an attitude that has
colored Peruvian thought since a Chilean military
victory over Peru in the 19th century. Velasco said
that Peru and Argentina would have to maintain close
vigilance over what he called "Communist Chile," but
he showed annoyance, as have the B.azilians, with
Argentine President Lanusse's apparent friendly at-
titude toward President Allerde. While explaining
this concern about what he considers to be a Commu-
nist threat from the soutl, Velasco was relaxed
about Cuba, stating that it was far away and insig-
nificant. He apparently intends to continue his
government's policy of rapprochement with Havana.
These sentiments are similar to those expressed
recently by Interior Minister Richter, who specific-
ally indicated that the governmant intends to work
with the Communist-controlled labor federation as
long as it suited the government's interests.
Richter asserted, however, that at some point the
government would have to confront the Communists di-
rectly. Such a policy may be difficult to implement
if the Communist-controlled labor federation is able
to get a strong; foothold in the meantime.
Richter also stated that he believed the Soviet
Union was working with the Communist labor group to
undermine the Peruvian revolution. He specifically
mentioned labor agitation in the mining sector, which
seriously hurt the Peruvian economy in 1971. The
Peruvian Government values its relations with the
Soviet Union, however, bozh as an expression of "in-
dependence" from the US and because of economic aid
commitments dating from 1970. Thus it is unlikely
seriously to jeopardize these relations. (SECRET
NO FOREIGN DISSFM)
21 Jan 72 Central Intelligence Bulletin
Approved For Release 2005/06/09 Spell '5T00875R000800020017-0
 Approved For Release 2005/06/09 : fT00875R000800020017-0
BOLIVIA: President Banzer's belief that cer-
tain sent ro military officers have begun plotting
against him has helped motivate rapprochement with
an important group of younger officers..
The recently completed round of military assign-
ments gives the junior officers associated with pop-
ular Lieutenant Colonel Cayoja additional important
troop commands. In the wake of a dispute last Novem-
ber, Banzer was reliably reported to have decided to
remove them from their sensitive posts.
One reason for the President's change of heart
is his reported conviction that interior minister
Colonel Adett, state mining company director General
Miranda, and ambassador to the US General Valencia
are conspiring. While army commander General Arana
and former interior minister Colonel Selich have not
been implicated in the plot, Banzer has good reason
to doubt their loyalty as well.
The President evidently has decided that he must
rely on younger officers, whom he knows to be antag-
onistic toward the alleged plotters, as his main
bulwark in the military.
21 Jan 72 Central Intelligerce Bulletin 7
25X6
Approved For Release 2005/06/09 3J?5T00875R000800020017-0
 Approved For Release 2005/06/09 SJ~QRT00875R000800020017-0
ITALY: Leaders of organized labor have given
a guardedly favorable initial response to a plan of
Confindustria, the country's principal association
of manufacturers, for economic recovery.
Confindustria believes that ambitious growth
targets are within the economy's potential. Its
plan shows a new willingness by management to re-
orient economic growth more toward social develop-
ment and away from dependence on exports. The plan
suggests that both government consumption and social
investment in 1972 be increased by about 36 percent
above 1970 and that the net foreign deficit be al-
lowed to increase. By endorsing labor's goals of
social reform and greater employment, Confindustria
undoubtedly hopes to receive union guarantees of
fewer plant-level disputes and greater restraint in
wage and fringe benefit demands. About 50 national
labor contracts, involving some four million work-
ers, that were signed during the "hot autumn" of
1969 must be renewed this year.
An effective plan to combat the recent economi--
slowdown is a key goal for the center-left parties
in their week-old effort to form a new coalition
government. Opposition to the government's economic
policy was the issue which the small Republican
Party cited when it provoked the present crisis by
withdrawing its parliamentary support from the gov-
ernment.
Negotiations looking toward a new government
are also complicated by a scheduled referendum on
abrogating the country's divorce law, a seriously
25X10 divisive issue among the four center-left partien.
President Leo-ae
e.ieves a e referendum issue should be set-
tled now or parliament should be dissolved and elec-
tions held. The call for elections would postpone
the referendum, whir' :ould not be held until one
year after the convo,,;,Ation of a new parliament.
(SECRET NO FOREIGN DISSEM)
21 Jan 74" Central Intelligence Bulletin
Approved For Release 2005/06/098]glg-R'5T00875R000800020017-0
 Approved For Release 2005/06/09 : CIA-_RDP85T00875R000800020017-0
S.FIGR.~?'.L'
SPAIN: The government expects that strong
police action against Madrid University student
demonstrators will show that it will nci, tolerate
widespread disorder.
Although the clashes were precipitated by the
suspension of 4,000 medical students protesting a
change in the medical school curriculum, the unrest
has more fun.damentel causes. Students resent the
presence of uniformed and plainclothes police on
the campus and in classrooms since the student
riots of early 1969. Many of the deans are inef-
fective and hostile to the students. A polariza-
tion of students has been brought on by the dis-
ruptive tactics of a small but militant group of
extreme leftists--including a number of well-organ-
ized, Communists--who have clashed with an even
smaller group of extreme rightists. Underlying
these factors is widespread campus opposition to
authority in general and especially to the Spanish
Government and the establishment.
The students have become so resentful that
they have extended their demonstrations--which visu-
ally take place up until Christmas-,-into the period
customarily reserved for preparing for February
examinations. The authorities may resort to closing
Madrid University to ease the situation. In the
past, the threat of canceling examinations has usu-
ally served to quiet student unrest.
There is no indication that the government is
considering more severe measures, such as a decla-
ration of state of emergency used during the dis-
orders in January 1969. It was the conjunction of
student and labor protests at that time that caused
the government to react harshly. Although there
were some serious strikes and labor disorders last
fal?., the labor situation has been relatively quiet
since Christmas. Workers might mount scattered
protests to demonstrate their solidarity with the
students, but fear of jeopardizing their jobs prob-
ably will prevent them from undertaking substantial
protest acti.ons. (CONFIDENTIAL)
21 Jan 72 Central Intelligence Bulletin 9
Approved For Release 2005/06/561~P85T00875R000800020017-0
 Approved For Release 2005/06I R ?P85T00875R000800020017-0
SOUTH-WEST AFRICA: The strike of Ovambo mine-
workers, now in its sixth week with negotiations
for a settlement just beginning, poses difficult
political choices for the government.
Almost 14,000 Ovambos have walked off their
jobs, severely hampering activity in the modern
sector of South-West Africa's economy. Agricul-
tural workers, railroad workers, and tugboat op-
erators also have gone on strike recently. Con-
struction is at a virtual standstill throughout
the area. Mine owners have tried to return the
Ovambos to their homeland and hire others, but
only 2,000 untrained and inexperienced replace-
ments have been hired. The mineworkers have de-
manded job security, abolition of the contract
labor system, which the ovambos see as akin to
slavery, and better pay.
A South African student leader claims
the strike was planned as early as
last June by Ovambos organized in cells. F? South
African journalist claims he knew in November
that a strike was planned. The police are still
handling the Situation as an industrial dispute;
perhaps in part because acknowledgement that it is
political would reveal them as lax in their sur-
veillance.
The South African Government finds itself in
a serious dilem*ia. Officials recognize that the
contract labor system is outdated and needs revi-
sion, but to give in now would, in Pretoria's
view, set a dangerous precedent for black labor
elsewhere in southern Africa. (SECRET)
21 Jan 72 Central Intelligence Bulletin
25X6
Approved For Release 2005/06 CD&bP85T00875R000800020017-0
 Approved For Release 2005/06/09 : CIA-RDP85T00875R000800020017-0
S11;CRE'I'
25X6
EUROPEAN COMMUNITIES: France has succeeded in
scheduling an early Council debate on the question
of community aircraft po'.icy, including the issue of
reinstating currently suspended tariffs on aircraft
imports.
Until 1971 there had been no difficulty each
year in suspending the statutory five-percent EC
tariff on aircraft weighing over 33,000 pounds. A
French industry request last year to let the suspen-
sion expire was turned down by the Council, in part
because of pressure from airlines to avoid a step
that would make the aircraft they buy more expensive.
At that time, however, France's partners did agree
to review the suspension policy before the enc, of
1973--that is, after th% British were in the commu-
nity. It now appears that this matter could be dis-
cussed as early as March. In the past, the Commis-
sion has argued that it would be better to work to-
ward the abolition of third-country tariffs on air-
craft--the comparable US rate is six percent--than
reimpose community tariffs.
The EC Commission is preparing a study on the
aircraft industry throughout the community. This
could serve as the basis for community action that
would foster consolidation and modernization and
thus permit facing up to US competition. A prelim-
inary report is expected to be published in February
or March, but a full -olicy paper will be delayed
21 Jan 72 Central Intelligence Bulletin
Approved For Release 2005/C?LQt j,A DP85T00875R000800020017-0