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April 12, 1974
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('/4n.r.1 C/tt// Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 OkSFILE COPY OETUi N TO 111-1107 Top Secret 25X1 25X1 Weekly Review State Dept. review completed. DIA review completed. Approved For Release 2009/04/22: CIA-RDP85T00875R001000050003 9 .~, Top Secret 12 April 1974 Copy N2 421 a1e~Sr,.tE'Al~eFfSCR!~r~~r~'yRSA'ASV.7l+SPCCU.'~3R3~C~,5'iF:`~'s..~,,..~yLCr:.'2til.'!4~;:CFI;r_?;:C:.rt~,^t^:~, a,~r .. w*~ -err-, -. . Fitf-ale llwYr. ? 41W 4^3rW'S4.R. ~l iY Se4i 4'V': r.. 4. i'. ,??.~?. U^tn M,\` '+M..rW ., Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Conference hall in Vienna East-West Talks Adjourn I10e Cooferet cco on ScurrIt y and Coupera- hrrn ii; i_ impe (CSCL) III Geneva amI the Mutual I;al,u0~.r.d I orr t? R1:ductii n (ML'F 11) talks III Vi nrra have Muth acllmuoned for L;rslci ,0iter ses- ons a ,lr lard by st0hstant al prurfrc,ss in Geneva but little he delay in Vi11ona. Nixi ris to show snore tangible results he- the L.urop(1arr ser:toily conferinc.e reusrud ml April ), the Soviets agreed to a last-manrte cnrrrf>ron0ise nil the principle u0 inviol,ibility of frontiers. -111e Soviets evidently were motivated by r desire to hove the negotrahuns along toward a concluding thud stage at a meeting of heads of state, ill July. Lilo hnev has taken a close personal interest ir, winding tip the confereoceu this srnruncr. Ii vu >hiu lit y of fl III lier5 (1 CariS, for the So- vrets. Western arce;pt,uncc of the postwar hoUnd- ,irres nn Laster ii Lurope and, by in0plicitiorr, of Soviet hcr_fel0ony in the area. Moscow initially sought an all-encompassing statement on the in0- 111ulahility Of frontiers. This was objectionable to Page I some Western delegations, particularly the West Our ii (dOS, who (lid mtt want lu foreclose the pos- sibility of eventual Ge(rnan0 reunification by peace ful nneans. In the end, the Soviets got a .t,ilr~rnient that was worded in such a way as to n0rply a hall on changes of hontiers by forcible nie,rris. I'mthernone, a separate principle in the ,0gree10eot acknowledges the right of states to r h,nige their borders by peaceful means. Ilaving passed this hurdle, the conlcoence ran move un to the cor0hoversial problem of beer movement of people and ideas when it reconvenes can April 22. The West has stressed that an agree- ment most include some specifics 10 this area so that the corrfereur.e can produce inure than plati- tudes on detinle. i-he Soviets have been holding Dark until the question of inviolability of fron- tiers was resolved. They may now argue that, since they retreated from their nraxirtrunr de- mands on that principle, the West should recipro- cate a11(1 relax pressures for heel n0overnent. Thera is (0010 for acconunoclation on the part of both sides, and it seems likely that wording will be found to satisfy both the West's nnlerest in "concrete" results and Moscow's desire to avoid Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 any "meddling" in what it considers to be the USSR's internal affairs. An Italian plan for a separate document on European-Mediterranean relations has been tenta- tively approved by the EC but not yet introduced into the conference. The Mediterranean issue could disrupt or delay a successful completion of the conference by introducing the contentious Middle East dispute into the negotiations and into any follow-up arrangements th't are adopted. Both the US and Soviets can be expected to oppose the plan, and the EC political directors will take another look at the Italian proposal at their April 18-19 meeting. Ultimate acceptance by the West Europeans of a summit-level finale is likely, but there will still be some uneasiness about thus consecrating the conference results, especially if it seems that little has been gained in the force-reduction talks by that time. The West Europeans alsc hope for progress on the so-called confidence-building measures in the area of military security through adoption by the conference of a plan for prior notification of major military movements. Fears have been ex- pressed that the Soviets may try to win support from neutrals and some allies for a partial solu- tion of this question in order to isolate the US, which would prefer to discuss this issue at MBFR. The EC Nine generally remain cautious on ar- rangements for follow-up procedures to the con- ference, but may be moving toward acceptance of proposals made by the neutrals that would entail limited formalization subsequent to the con- ference. MBFR: Little Headway in Vienna The force reduction negotiations recessed with the NATO and Warsaw Pact participants still far apart on how to achieve a reduction agree- ment. Neither side has made substantive conces- sions, but informal meetings have helped shed light on the issues to be resolved and the need to develop common data as a basis for further nego- tiations. Each side now understands the other's posi- tion better, but there are no signs of a meeting of minds. The Warsaw Pact accepts the fundamental NATO thesis that there is a ground force imbal- ance favoring the East, but argues that, while NATO has fewer ground troops and tanks, it has an advantage in air and nuclear forces. The pact, therefore, does not acknowledge the need for asymmetrical reductions to reach a common ceil- ing, as NATO has proposed. The East contends that there is thus an over-all balance in central Europe. The proposals put forward by NATO and the pact both embody a concept of phasing, but the resemblance ends there. NATO believes that only US ..-.rd Soviet forces should be reduced in the first phase, while the Warsaw Pact wants the forces of all direct participants to be involved in each of three stages of reductions. The Soviets have interpreted the NATO position as indicating a reluctance on the part of the West Europeans to reduce their forces. During the current recess, NATO members will discuss ways to assure the Soviets of their willingness to reduce forcrs with- out abandoning their basic desire to reduce US and Soviet forces first. In recent informal meetings, the Soviets have pushed for Western acceptance of a symbolic re- duction to take place in 1975. In an effort to make this proposal more attractive, they have hinted that air and nuclear forces could be frozen during this phase rather than actually reduced. The Soviet concept, however, still embodies equal numerical reductions by each side as well as re- ductions by all direct participants. This has been rejected by NATO, which suspects that the So- viets' apparent eagerness to conclude a symbolic reduction may trap them into accepting prece- dents that will be difficult to overcome in subse- quent stages of negotiation. The question of establishing agreed data on force strengths was raised at the final informal meeting. The two sides attempted to reach com- mon definitions, beginning with ground troops. This is another topic that both wi!l mull over during the recess. Page 2 Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Syria-Israel As shelling of Israeli positions on the Golan Heights entered its fifth straight week, Syria's delegation to the Washington disengagement talks-led by army intelligence chief Shihabi- finally arrived in the US. A day later President Asad set down in Moscow for consultations with Soviet leaders; an economic delegation had pre- ceded him by a few days. Asad may be seeking additional economic and military aid, but his visit seems timed primarily to assuage Soviet sensi- tivities about being excluded from the Washing- ton talks. Syrian leaders, meanwhile, continued to take a tough public stand on peace negotiations with Tel Aviv. On the 27th anniversary of the Beath party last Sunday, Asad emphasized o',ice more that Syria would settle for nothing 'less than Israel's withdrawal from all occupied Arab ter- ritory and implied that the shelling would con- tinue until this objective is obtained. In a veiled reference to Egypt and other Arab moderates, Asad also criticized "some Arab brothers" for characterizing Syria's position as "inflexible." Relations between Cairo and Damascus have in fact become strained as a result of the lifting of the oil embargo and the postponement of the Arab League summit con- ference until September. Syria had sought to have the summit held this month in order to obtain the endorsement of other Arab states for its nego- tiating stance. Although Asad believes that Cairo has frequently acted uni- laterally to Syria's detri- ment, he is unlikely to break publicly with Presi- dent Sadat as long as he sees some advantage in maintaining the appearance of a united front with Egypt against Israel. Syrian Defense Minister Talas struck an even more belligerent note in remarks on April 5 to a visiting delegation of Arab parliamentarians that included some Egyptians. Talas told the group that while Syria was not opposed to peace, it was "now prepared to launch an all-out war against Israel to ensure the liberation of all occupied territories." At least some Israeli leaders are apparently not taking Talas' threat too seriously. An Israeli Foreign Ministry official told a US Embassy of- ficer in Tel Aviv last weekend that Israeli analysts did not expect Syria to increase the current level of fighting. Instead, the official thought the shelling is designed to put pressure on Israel as Egypt had done during its disengagement talks, to satisfy Syrian hard liners who oppose Asad's ef- forts to seek a disengagement accord, and to impress upon the Soviets the seriousness of the situation prior to Asad's visit to Moscow. Recent reporting from the US defense attache in Beirut tends to support this interpreta- tion. According to the attache's sources, the Syrians seem to be deliberately avoiding inflicting "unacceptable" losses on the Israelis in order to keep tensions within controllable limits. The Syrian shelling has been scattered rather than concentrated and has passed up vulnerable targets such as Israeli troops at mess. The shelling also has begun at almost the same time every day, giving the Israelis time to take cover. These interpretations may not be shared by the Israeli military commanders, however, who have shown that they are prepared to strike hard at anything that looks like a Syrian intention to attack. Controlling the level of violence in the Golan Heights could be a difficult exercise for 25X1 Page 3 Apr 12, 74 "*'-"qi".?"'7 u . R??^'7i?:v,,.",'..'H~:'w.=..::?^:.> -r. ~'.:.-~^:~?.,, w~.o.:s.:u,a..,va.~.:r.?,uwvmar.>+a+r.:.acn;nax " 1975 1980 1985 'Excluding US preproduction stocks. Such stocks amounted to 17.1 million separative work units an 1 July 1973. are expected to reach a maximum at 33.7 million separative work units during fiscal year 1978, and to be completely exhausted by the end of 1982. 55562: 4 14 25X1 Apr 12, 74 Approved For Release 2009/04/22: CIA-RDP85T00875RO01000050003-9 ' Page 14 WEEKLY REVIEW Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 YUGOSLAVIA: POLEMICS ON TWO FRONTS Belgrade is continuing its war of words with Rome on the issue of Yugoslav sovereignty in Zone B, but there are some signs that Yugoslav leaders want to wind down the controversy. At the same time, increased polemics with Bulgaria may herald a shift of Yugoslav concern over "ir- redentism" to the south. Belgrade is showing its concern over Zone B by the continued presence there of the regular army units placed on alert early this month. Moreover, Yugoslav media continue to protest Italy's questioning of Yugoslav sovereignty in Zone B, and to reiterate Belgrade's determination "to defend every inch of Yugoslav territory." Among the signs that the Yugoslavs may be ready to tone down the controversy is the deci- sion to release reservists who were called up especially for the Trieste "crisis." Furthermore, there are hints that Belgrade may be thinking about resuming quiet bilateral talks with Rome. Stane Dolanc, the front runner to succeed Tito in the party, said his country "will do everything possible to settle the situation," though he barred any "unprincipled concessions." A Yugoslav For- eign Ministry spokesman implied privately that Belgrade is indeed thinking about resuming a dia- logue with Rome. As the Zone B affair simmers, a renewed flare-up of the Macedonian dispute is drawing Belgrade's attention southward. Yugoslavia has been denouncing Sofia's refusal to recognize Macedonians as a non-Bulgarian nationality- newspaper in the capital of Yugoslavia's Macedonian Republic has also criticized Moscow for its alleged support of Sofia's position. Yugoslavia's concern with the Macedonian question may also reflect anxiety over reported plans to hold a Warsaw Pact exercise in Bulgaria in late May. This activity, the first in the Balkans since 1967, is scheduled to take place at the same time that Yugoslavia holds its tenth party con- gress. Having sharply criticized the NATO exer- Page 15 Ljubljana. l~l -"--International boundary(1970'L _ O MHAS a 1. ?Rijoka cise in the northern Adriatic last week, Belgrade may feel equally compelled to protest the pact's plans for maneuvers in Bulgaria. Belgrade may feel that both of Europe's major military alliances support countries having designs on Yugoslav ter- TALKS ON DISARMAMENT The 26-member Conference of the Commit- tee on Disarmament will convene in Geneva on April 16. The US still backs the committee- which is a non-UN body under the co-chairman- ship of the US and USSR-as the best forum for the consideration of multilateral arms control measures. Its lack of any substantial progress on a Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 25X1 25X1 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 broad range of issues considered over the past years has undermined the confidence of partici- pating states, however, and possibly threatens further continuation of the CCD. Another sterile session at this time, coupled with the increasingly vocal demands of the nonaligned for real progress in disarmament negotiations between the super powers, could generate new pressures For transfer- ring the debate to a UN forum which would be more amenable to nonaligned control. An agenda for the conference has not yet been drawn up. The two Germanies have indi- cated their interest in joining the committee; to balance their admittance, the nonaligned have re- quested additional slots for Asian, African, and Latin American representatives. The expansion of membership to 31 is likely to meet with little opposition. A potentially divisive issue, however, is the Japanese draft treaty on chemical weapons, which has been submitted for consideration at this ses- sion. A perennial submission, the chemical- weapons issue has received much attention in the committee over the years, but the insistence of the US and other Western powers on the necessity of verification procedures has blocked any at- tempts to draft a new protocol. The US has meanwhile come under increasing criticism for its research and stockpiling of chemical-warfare agents; the discussion of chemical-weapons con- trol may be pushed by a number of delegations. It can also be expected that the super powers will again be taken to task for lack of progress on a comprehensive nuclear test ban. The status of the committee as a forum for disarmament debates has been increasingly eroded in recent years by the proliferation of simil-ir conferences and groups under the aegis of a vari- ety of international organizations. Soviet initia- tives for a world disarmament conference and an experts group to discuss the reduction of military budgets have attracted nonaligned support and are being pursued at the UN. The Law of War Conference sponsored by the International Red Cross, which recently concluded in Geneva, has scheduled a follow-up conference to be held in June specifically to discuss certain weapons, such as incendiary and napalm devices. The first pre- paratory committee for the 1975 Non-Prolifera- tion Treaty Review Conference has just adjourned in Geneva, and in New York nuclear and disarma- ment questions have recently surfaced in connec- tion with discussions of the Indian Ocean " z o n e of peace." Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 25X1 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 cross-service capability, and reduce unit costs. This goal has bee~i strongly endorsed by all except Belgium. EUROPE: F-104 REPLACEMENT BLUES The competition over what aircraft will re- place the US F-104G Starfighter in Belgium, the Netherlands, Norway, and Denmark has been nar- rowed to the French Dassault Mirage Super F-1 and three American contenders of which the Nor- throp Cobra P-530 is currently the favorite. The decision will channel billions of dollars into the manufacturing country and could have ramifica- tions that significantly affect US-European rela- tions. The choice underscores the dilemma of NATO allies who want to preserve defense links to the US while supporting "European" under- takings. It is particularly difficult for such staunch Europeanists as the Dutch and the Bel- gians, who feel trapped in a position where any decision must antagonize either France or the US. Defense ministers of the four will meet soon to discuss the matter further. The French argue that selection of the Mirage would reduce European dependence on the US while strengthening the European aircraft industry. A decision in favor of the US aircraft would encourage continuation of military ties be- tween America and Europe, and would provide for transfer of the latest US aircraft technology to Europe. It would also demonstrate the willingness of the four countries to cooperate in offsetting the US balance-of-payments deficit incurred' by stationing US forces in Europe. The Secretary General of NATO has urged all NATO count; ies requiring new aircraft to seek a common replacement, as standardization would enhance cooperation among NATO forces, ensure Leaders of Belgium's caretaker government- including the prime minister and the ministers of defense and economic affairs-have denied recent rumors that the cabinet has already made a uni- lateral decision to buy the French Mirage. Belgian officials have conceded that they have narrowed the choice to the Mirage and the Cobra, and they have further admitted that Dassault made "very interesting proposals on compensation and coop- eration." They insist, however, that no formal decision will be taken until a new government is formed. Belgium's attitude is critical because it is likely to be the first of the four to commit itself on a replacement. Since Belgium could be the key to world-wide sales that might amount to as much as $10 billion, the French have applied intense political, economic, and personal pressure on Brussels to choose the Mirage. There is apparently fierce disagreement within the Belgian Bureauc- racy, but most of the signals that have appeared so far suggest that the Mirage is the front-runner. The Dutch, referring to an "agreed position" of the four countries to consider all competing offers before making any decision, have expressed concern that the Belgians are attempting to limit the choice. There are indications that high- pressure French sales tactics have been counter- productive in the Netherlands. The Dutch de- cision will b' delayed until a crucial defense White Paper has been approved by :'!e cabinet, which may not occur before next fall. The Nor- wegians and the Danes have privately expressed their preference for an American replacement, but their final decision may not be made this year. Although the Germans are not directly in- volved, they are interested in keeping the US engaged in Europe. They have agreed to attempt a bit of discreet prodding 'n the Scandinavian and Benelux capitals, where they are not without in- Page 17 Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Negotiations on at least five other subjects are currently in progress. Talks on a cultural agreement remain deadlocked because of differing interpretations over what constitutes the cultural traditions of the "German" nation. Pankow wants to restrict cooperation in this field as part of its policy of establishing a German state that has little in common with the political and cultural traditions of the Federal Republic. Many officials in Bonn are skeptical that an agreement will ever be concluded. Negotiations on a legal assistance agreement also pose many difficulties because of the large number of political snares in providing such aid to West Berliners. Commerce between the two Germanies will remain under the aegis of the Interzonal Trade agreement. West Berlin officials are pleased by Pankow's agreeing to let the Interzonal Trade administrative office remain in West Berlin rather than requiring that it be transferred to Bonn's new mission in East Berlin. The right of West Berliners to visit East Berlin and East Germany remains the most troublesome issue in inter-German relations. West Berlin officials complain that Bonn has not done enough to press Pankow to rescind its de- strate that it is an effective defender of the city's in`e..e st WARSAW PACT SUMMIT The pact's Political Consultative Committee, composed of Soviet and East European party chiefs and government leaders, will convene in Warsaw next week to discuss detente. The session may well issue a call for faster movement in the European security and force reduction talks. An East European diplomat claims that special atten- tion will be given to the effects of detente on the East European countries. The gathering may also discuss the renewal of the Warsaw Pact treaty, which formally expires next year but is automatically renewable for a ten-year period unless renounced by May 14, 1974. In this connection, the session could also revive an old propaganda theme designed to por- tray the pact as a champion of peace. The partici- pants might express some willingness to dissolve the pact upon the conclusion of the European security talks and then call on NATO to respond in kind. The Warsaw Treaty provides for its auto- matic dissolution after the establishment of an appropriately vague "European collective security system," part of which is a general European security treaty. The session was evidently initiated by Mos- cow and is expected to last only a day or two. The last such meeting, held in Prague in January 1972, issued a maior statement on force reduc- GERMANS EXPANDING TIES Bonn and Pankow are making progress in fleshing out their bilateral relations despite differ- ences over Berlin issues. The two states will take a major step toward recognizing the division of Germany for the foreseeable future when they exchange missions in early May. Their agreement last month on this step opened the dam, and since then the two sides have agreed on additional bilateral accords regu- lating "practical and humanitarian" matters. A sports agreement was tentatively concluded on March 20, and negotiations on health and non- commercial payments agreements were concluded last week. The details of the latter two agree- ments have not been made public, but both con- tain clauses extending their provisions to West Berlin. All three accords will probably be signed later this month. cision to double the minimum currency exchange requirement for visitors. This step has reduced by nearly half the number of visits by West Berliners since last fall. Egon Bahr, Brandt's chief foreign policy adviser raised this issue with Brezhnev re- cently, but few in Bonn expect Pankow to lift the new currency exchange requirement. The Social Democratic - controlled city government in West Berlin, nevertheless, faces elections early next year, and intends to harp on the issue to demon- Apr 12, 74 Page 19 WEEKLY REVIEW t ta~.w'+`n.. ':d. ta:'.?_U'~ 7w:rS,:'az~r.^?.^.r.'~c'd+rsca~crcntovxn?aa.-.nrr..a ~rv_cnnun.:>.:a~.r....,wr.~..xr~mu+~xma~.~s...~a.> .. ......+~.,.., r+..:nr~cnerie~xmaIIn,..trxo:u-,,vaa~.mm~:~r.r~-:: _, ^t Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Y=y Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 King Husayn campaigned for support of his approach to the West Bank problem in a round of visits to Egypt, Syria, and Saudi Arabia during the past week. Although the King is clearly willing to concede a role to the Palestine Liberation Organi- zation at the Geneva peace talks, he appears as determined as ever that Jordan be the agent for the recovery of the territory from Israel. While in Cairo on April 5-6, Husayn did not fulfill predictions in the Arab press that he would align Jordan with the other Arab states by pub- licly recognizing the Palestine Liberation Organi- zation as the "sole representative of the Palestin- ian people." In an interview with the semi-official Egyptian newspaper Al-Alrram, the King said only that he did not oppose the Palestinian organiza- tion being represented at Geneva and that he had offered it places on the Jordanian delegation. Husayn's position apparently was tougher than Cairo had anticipated. This may make it more difficult for President Sadat, who wants both the organization and Jordan represented at Geneva, to persuade the Palestinian group to attend the talks. Nevertheless, from all indications, the Husayn-Sadat talks took place in a friendly at- mosphere. According to the official communique, Jordanian-Egyptian contacts will continue, and the Jordanian press has indicated that Sadat agreed to visit Amman in the near future for the next meeting between the two leaders. Husayn arrived in Saudi Arabia on the 11th. It is unlikely that King Faysal raised any opposi- tion to Husayn's position on the West Bank, but he may pres< Husayn to hold fast against making 25X1 any territorial concessions-especially on Jeru- Responding to criticism by Egyptian Presi- dent Sadat, Moscow last week quickly began de- fending its record as a reliable ally. In broadcasts to the Arab world, Soviet commentators attacked "some quarters" fcr spreading doubt among the Arab people about the value of Soviet support, and for sowing distrust of basic Soviet policy in the Middle East. Moscow contradicted Sadat's charge that it had opposed the Arabs' use of armed force and stated that it had given firm military support to Egypt and Syria during the war. The Soviets may be doing more than making propaganda to show their displeasure with Cairo. Sadat reportediy said on April 6 that the USSR had "just" ceased delivery of all military equip- ment under "old" contracts, adding that eco- nomic aid shipments had also been halted. The deputy Tass director in Cairo has privately told US officials that supplies had been "cut off," but implied there is nothing immutable about the Soviet decision. The last reported Soviet arms carrier arrived in Egypt two days after Sadat is said to have made his comment, and he may have been referring to a Moscow decision to halt ship- ments after deliveries under specific contracts have been fulfilled. The Soviets are evident;y prepared to take a tougher line with Cairo, anti might cut back or Page 20 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 threaten to stop aid deliveries to the Egyptians. It seems likely, however, that Moscow will try to weather the current storm in the hope that Egypt will not soon get what it wants from Israel and will again see the need for close ties to the Soviet Union. A rumor was floated in a Cairo newspaper last week that an Egyptian-Soviet summit is in the works. This is almost certainly not true, but the rumor itself may be evidence that Cairo is having second thoughts about pushing the Soviets too far. Moreover, Cairo has indicated that it expects Foreign Minister Fahmi to meet Gromyko Burin ISRAEL: GOLDA QUITS Prime Minister Meir's resignation on April 11, barely a month after she had laboriously patched a coalition cabinet together, opens up the prospect that Israel may have to limp along with a caretaker government for an extended period. Page 21 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22: CIA-RDP85T00875R001000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 GREECE-TURKEY: NEW AEGEAN FRICTION The prospect of extensive oil deposits in the Aegean seabed has fueled a dispute between Athens and Ankara over conflicting offshore ex- ploration rights. Turkey is pressing for bilateral talks, but so far the nationalistic junta in Athens has ;own no inclination to negotiate and may welcome the controversy as a diversion from domestiL. orcblems and a means of unifying the army. Offshore oil rc ves recently discovered near the Greek islal.d of Thasos, which may yield some 500,000 barrels per day, are not in dispute, but have encouraged the Turks to plan prospect- ing activities in areas that Greece considers to be part of its continental shelf. This week a spokes- man for the Turkish Foreign Ministry announced a cabinet decision giving Turkey's national petro- leum company the go-ahead to explore near four other Greek islands. The official said this will begin after the decision is published in his govern- ment's official gazette. Ankara's action, probably designed to smoke out a response from Athens to an unanswered Turkish diplomatic note of late February, could well be viewed by the Greek junta as a challenge. The Greek military regards the Aegean seabed as a vital economic preserve and has been taking a touqh stance on the dispute, presumably to con- vince the Turks to take seriously Greece's claims to exclusive oil exploration rights. Even before Ankara's announcement this week, the Greek armed forces reportedly had readied contingency plans that include discreet augmentation of army units near the border with Turkey ana increased naval patrolling of northern Aegean waters. Greek military activity in the border area has in fact increased recently. Athens is saying that the issue should be resolved on the basis of the 1958 Geneva conven- tion on the continental shelf, which would give Greece extensive rights in the Aegean, and that no political negotiations are necessary. The chairman of the committee preparing for Greek participa- tion in the Law of the Sea conference this week confirmed the Greek position to the US Embassy in Athens, stating that the Greeks and Turks would continue to talk, but there was "nothing to negotiate," as "no country could negotiate its own sovereignty." The chief of the Greek Army also reportedly stated this week that an agree- ment by Greece to talk would be an admission that Turkey had a valid case to present. There are some indications, however, that more moderate Greek officials, including the foreign minister, are trying to cool the controversy. Official Turkish pronouncements have been relatively moderate, but the Turks seem deter- mined to get what they believe is their share of Aegean oil. They are not a party to the 1958 convention and apparently maintain that, in any event, the Aegean is a special case and agreement should be reached on a basis of equity. Since oil exploration is still in an early stage, there is time for further assessment and maneu- vering by the two sides. The US Embassy ir. Ankara believes, however, that with possible new sources of wealth and a historic rivalry involved 25X1 Loth governments are probably prepared to run Tirana GREECE Mlles )1:50 0 KII?metcrs 150 555655 4-74 CIA Page 22 WEEKLY REVIEW ,Sofia BULGARIA GRAIN SAM0THRACE0 LEMNOSr 7 Disputed oil 4Xplaratioo am ?oo.tEGEAn?LE TURIIEY S EA ? ylthen cHIM 00 o a?~ Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 CYPRUS: INTERCOMMUNAL TALKS STALLED The six-year-old UN-supervised talks on a system to govern relations between the majority Greek Cypriots and the minority Turkish Cypri- ots were adjourned abruptly last week without setting a date for the next meeting. None of the parties involved appears bent on ending the nego- tiations, but the talks are in a difficult phase caused by a recent hardening of positions and President Makarios' heightened concern about Athens' intentions toward his regime. The current impasse was precipitated by the Greek Cypriots, who chob,: to make an issue of Turkish Prime Minister Ecevit's public statement in late March advocating a federal system for Cyprus. Federalism is anathema to the Greek Cypriots, who insist that talks are pointless unless the object is the creation of a unitary, independ- ent Cyprus. Turkish Cypriot Vice President Denk- tesh and the Turkish ambassador in Nicosia have tried to play down Ecevit's statement, claiming he was misinterpreted and denying that there has been any change in Turkish policy toward Cy- prus. The issue of federalism was apparently not raised directly in the talks, but the spokesmen for Ankara and Athens reportedly were both taking a harder line shortly before the negotiations were suspended. Although Ecevit and his party are on record as favoring federalism for Cyprus, this presumably represents Ankara's maximum bargaining posi- tion. Similarly, the Greek Cypriots' decision to stall the talks at this time is probably essentially a tactical gambit, although they are obviously de- termined to bury the idea of a federal solution. President Makarios has declared that if the dead- lock is not broken, the Cyprus issue should be returned to the UN Security Council. The UN's special representative on Cyprus is trying to work out a formula that will allow early resumption of the intercommunal talks. Athens last week repeated its standard policy line of support for the talks and for an independent, unitary Cypriot state. President Makarios fears, however, that the nationalistic, anti-communist junta in Athens may be plotting against him and clandestinely supporting enosis, which aims at the union of Cyprus and Greece. He has recently tried to increase his control over the Greek-officered Cyprus National Guard, which has been implicated in pro-enosis incidents. The US Embassy in Nicosia also suspects that Makarios, in order to shore up his position, en- couraged recent Soviet demarches-delivererl to Greece, Turkey, Britain, and the US-that pro- fessed to see Cyprus' sovereignty endan- gered. IRAQ: KURDISH AUTONOMY SIMMERS ON The government has made little progress to- ward winning Kurdish support for the autonomy plan announced a month ago, but Baghdad ap- pears determincc ',,) push ahead. A substantial military force has been moved into the Kurdish area to assure government control of urban and industrial centers. The rebels have largely aban- doned these areas for more defensible positioi:s in the mountains to the north and east. Reports of intermittent clashes-sorne involving artillery, mortars, tanks, and even aircraft in limited num- bers-remain mostly unconfirmed, but skir- mishes will probably continue. Kurdish claims of heavy government losses probably are exag- gerated. Both sides have launched propaganda cam- paigns designed to win support for their positions on the autonomy issue. The government has played up alleged progress in implementing its autonomy plan for the Kurds. The Kurds have reactivated a clandestine broadcasting station and have sent representatives abroad to explain their cause and seek foreign aid. The rebels' continuing attention in domestic propaganda broadcasts to the specific issues in dispute suggests they may yet be willing to negotiate their differences with the government. Page 23 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Baghdad has two main options, neither of which has much prospect for early success. It can move to consolidate its hold on the urban Kurd- ish areas it now controls, while launching limited military operations designed to whittle away the territory held by rebel leader Barzani. Alter- natively, Baghdad can try to break the impasse with an all-out military offensive. The govern- ment probably still regards this as a last resort, but it may feel compelled to follow such a course if a more gradual approach ties down a large military force in prolonged and unproductive skir- mishing in the north. Although the government might be able to subdue the Kurds with the forces and weapons already available in the area, any such attempt could drag on inconclusively as in the past. An unsuccessful military campaign against the Kurds could strain relations between the Baath govern- ment and the armed forces, which would bear the brunt of intensified Kurdish resistance. SOUTH ASIA: TOWARD BETTER RELATIONS The agreement reached in New Delhi on April 9 by the representatives of India, Pakistan, and Bangladesh, resolves the most serious prob- lem standing in the way of a normalization of relations among the adversaries in the December 1971 war. Some thorny issues remain, however, and will be the subject of further hard bargaining. Although the accords contain face-saving ele.nents necessary to satisfy domestic political requirements, particularly in Bangladesh, Pakistan achieved its major objective in the trilateral ne- gotiations. Dacca agreed to the unconditional, speedy repatriation of 195 Pakistani prisoners of _ war who have been held in India for possible war crimes trials in 3angladesh. In return, Islamabad made what amounts to a public apology for "any crimes that may have been committed." Pakistan also agreed to re-examine the cases of some Biharis-non-Bengalee Muslims-seeking to emi- grate from Bangladesh to Pakistan, whose ap- plications had previously been rejected. Addi- tional Biharis will prn)ably be admitted to Pak- istan as a result, but the total numbei finally accepted will remain a fraction of the some 400,000 who still wish to relocate. The accord moves reconciliation between what were, before the 1971 war, the two "wings" of Pakistan, an important step beyond the simple recognition Islamabad accorded Bangladesh last February. The two nations can now begin ne- gotiations on various bilateral matters apart from the Bihari issue, including the establishment of trade and communication links and the division of pre-war Pakistan's assets and liabilities. At some point, diplomatic relations will be estab- lished. Indo-Pakistani relations also made limited progress at New Delhi. India, which successfully played a mediatory role 'n the trilateral dis- cussions, concluded a separate bilateral agreement with Pakistan defining priorities for future dis- cussions to implement the 1971 Simla agreement between Prime Ministers Gandhi and Bhutto. Talks will begin shortly on the resumption of postal and telecommunications links and the res- torrtion of travel facilities, particularly for pil- grims. Presumably, discussions will come later on the restoration of diplomatic relations, which Is- lamabad had once insisted must come first, and on economic ties. The New Delhi accords should pave the way for Bangladesh's early entry into the UN. The Chinese, who were committed to keeping Dacca out of the UN until the issue of the 195 POWs was resolved to Pakistan's satisfaction, may now recognize Bangladesh and no longer oppose its Page 24 WEEKLY REVIEW Apr 12, 74 - Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 ARGENTINA: SUCCESSION POLITICS President Peron's age and fragile health, along with the turbulent nature of the internal political situation, seem to be fostering concern and anxiety over the presidential succession. The mood of uncertainty in the country encourages pulling and hauling among the Peronists as they struggle for position in the event of Peron's absence or death. ]Her reluctance to assume greater responsi- bilities despite Peron's prompting is reinforced by her perception of the serious internal conflicts that beset Peronism and of the likelihood that extremists will step up violence in the President's absence. The Vice President's failure to attend several recent official functions may be a sign that she is not holding up well under pressure. Some Peronists are trying to convince her that she has the stature and backing to rule in Peron's place, despite indications that she would be unable to muster a following among key groups such as labor, the armed forces, and youth. Another factor possibly contributing to Mrs. Peron's distressed state is her reportnd falling out with Social Welfare Minister Lopez Rega, an in- fluential adviser to Peron whose ambition for power appears to be souring the formerly close relationship he enjoyed with Mrs. Peron. Lopez Rega's son-in-law, Raul Lastiri, is constitutionally next in line, after Mrs. Peron. As head of the Chamber of Deputies, Lastiri held the provisional presidency after Hector Campora stepped down last July. A number of Peronist factions are appar- ently busy trying to build up independent power bases. Peron is aware of the politicking and re- portedly has said that certain government leaders Mrs. Peron Under stress are playing games" to enhance their positions before he dies. Peron reasons that some of these leaders have tolerated left-wing extremists out of fear that the left might come to power after his passing. While Peron did not pinpoint his sus- picions, reports of an impending cabinet shuffle may indicate that officials out of favor will be purged. Meanwhile, it is still unclear whether Peron will go to Spain before the onset of the Buenos Aires winter. He probably would like to seek medical attention and rest and to escape the damp inclement weather, but he obviously is trapped by the political entanglements caused by terrorism and the quarreling among his fqllowers. His hesitancy may also stem from a conviction that his departure would create a dangerous vac- uum. His doubts are not unfounded, since it is highly probable that politically inspired violence assumed his mantle. Page 25 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22: CIA-RDP85T00875R001000050003 9 t--_ ~-~ Approved For Release 2009/04/22 : CIA-RDP85T00875R001000050003-9 BOLIVIA: BANZER'S PLOY President Banzer has postponed elections in- definitely in the name of achieving the national unity he claims will enable the country to nego- tiate access to the sea. While this initiative in- volves long-term risks, Banzer seems to have strengthened his position for the short term by raising popular hopes of regaining the outlet to the sea that Bolivia lost nearly 100 years ago. Last week, Banzer held a carefully orches- trated conference in Cochabamba with repre- sentatives of the armed forces and various pres- sure groups to obtain their approval for sweeping political changes. Banzer began by stating that Bolivia should project an image of strength in the face of growing tensions between its Pacific coast neighbors, Chile and Peru. A military spokesman then announced that elections, which had been scheduled for May 1975, would be postponed to remove political pressure on the government, and he presented a declaration that gives Banzer a free hand to restructure his cabinet. The tone of the meeting suggested that Banzer believes his talks last month with Chilean junta President Pinochet hold promise for regaining access to the sea- perhaps through the north Chilean port of A: ica. The declaration, which was justified as nec- essary to improve Banzer's diplomatic negotiating position, was signed by most of the delegates. Although th :re was no open dissension during the tightly controlled meeting, a few participants re- fused to sign. So far, the government's only re- action to this recalcitrance has been to refuse to reimburse them for their lodgings and travel expenses. While the meeting gives Banzer the patina of public approval, the long-range effect of his moves will probably be to heighten discontent unless his negotiations with Chile produce results. Political leaders can be expected to be less co- operative, and those plotting against the regime may attract more supporters once the illusion of Cuba: PREPARING FOR THE PARTY CONGRESS Although the Cuban Communist Party's first congress will not be field until some time next year, the Castro regime is already involved in vigorous activity aimed at ensuring the event's success. Success in this case means maintaining undiminished Fidel's hold on power-by no means a sure thing. Creeping institutionalization, brought about both by Soviet pressure and by the demands of efficient government, is rapidly reach- ing the point where Fidel's old free-wheeling style of rule, were he to attempt to revert to it, would Page 26 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 meet significant organized opposition within the regime leadership. Fidel's ultimate authority in the decision-making process is still unchallenged (in large degree because he has voluntarily re- treated from many of his more extreme posi- tions), but he apparently is determinedly carrying out meticulous preparatory political work to pre- vent the congress from being a vehicle by which he is kept in a high position as "revolutionary" window dressing but deprived of his supreme authority. Ever since 1970, Castro has been reducing his interference in day-to-day administrative and economic matters, and thus reducing the da- maging impact of his injudicious meddling in affairs best left to better-qualified subordinates. In the past four years, he has inclined much more toward the appearances of group leadership, and he has delegated responsibility and authority to a greater degree than ever before during his admin- istration. At the same time, he has relaxed his resistance to the creation and development of political, legal, and administrative structures that are the prerequisites of efficient and successful government-the same structures that could be used to limit his heretofore unchecked authority. The party congress, of course, will be a key event in this process of institutionalization ane it is there--where a new political bureau, secretariat, and central committee probably will be se- lected-that the forces opposed to Castro's total domination are most likely to attempt to place formal restraints on him. Fidel-working primarily through his brother, Raul-is determined to prevent the in- stitutionalization process, and the congress in par- ticular, from being used against him. He has turned to his main source of strength-the mili- tary-which held its third party organization meeting from April 3 to 6. The sessions were dominated entirely by members of the Sierra Maestra guerrilla elite-those who s- ved in combat with the Castros during the revolution- and by those who owe their position to Fidel or Raul. By guaranteeing the continued loyalty of the party leadership in the armed forces, the Castros will be assured of considerable control within the party itself because the military has overwhelming influence in the party central com- mittee and, through it, the entire party rank and file. Similarly, the seventh national conference of the Young Communists League (the party's youth arm) held from March 31 to April 4 was domi- nated by those owing their allegiance to the Cas- tros. Ir these political organizations remain la:gely in FiJel's camp, those hopeful of placing re- strair,ts on his rule will have an uphill battle in engineering a political turnabout when the con- gress is eventually held. In less than two years, Quito's fiscal position has changed dramatically. Last year, the first full year after completion of the trans-Andean pipe- line, central government revenues increased by 49 percent to about $312 million. About half the increase came directly from the petroleum in- dustry, and much of the rest was from secondary effects of the larger oil income, mainly taxes on a much larger volume of imports. At the current reference price of oil, the government's petroleum revenue will increase to over $600 million this year, bringing total revenues to an estimated $900 million. Foreign-exchange reserves, which were down to only $12 million in 1972, have climbed to about $250 million. To most Ecuadoreans, however, these new riches have meant little more than higher prices. The consumer price index rose 17.5 percent last year, a sharp increase in a country where economic stagnation and conservative monetary policies had kept prices stable. Inflation has been aggravated by a slump in agricultural production, resulting in the need to import high-priced food. Fiscal policy has not been geared to stabilizing prices-the 1974 budget calls for increased spend- ing of 36 percent above the 1973 budget. New measures decreed on March 25 are unlikely in the short run to dampen inflationary pressures. In an effort to increase agricultural production, the PagE. 27 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9 government raised prices paid to farmers, which should transfer about $120 million from con- sumers to agricultural producers, and modest wage increases were decreed for low- and middle- income workers in both the public and private sectors. The new measures also included a price freeze on a wide range of consumer items, efforts to discourage foreign borrowing, and measures to increase credit available to the agricultural and housing sectors. While the government has been aware of the danger of inflation, it has been slow to attack basic causes. The government is apparently seriously divided on the issue of whether to grant wage increases to compensate for inflation, or to deny them for fear of starting an inflationary spiral. Token wage increases decreed last month have done little to satisfy workers. Further in- creases in food prices, coming after increases of about 25 percent in 1973, will be felt particularly by the politically volatile urban classes. The new price freeze is likely to be ineffective because Quito does not have the ability to supervise present price controls. Aware of the need to deal with popular discontent, the government will probably placate the demands of workers who complain the loudest, but this will only further add to inflationary problems. Page 28 WEEKLY REVIEW Apr 12, 74 Approved For Release 2009/04/22 : CIA-RDP85T00875RO01000050003-9