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February 10, 1975
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Approved For Release 2000/09/14 :CIA-RDP86T00608R0004~~~~6-8 No Foreign Di.r.rrm ~4G^~~~ ~J04C~~~ Western Europe 2sxs International Orgar~izations Secret 1. ~~ ~ No. 0128-75 February 10, 1975 Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 Approved For Releas~~0~01'r~/~q~ ~C~AA~~l'P86T00608R000400120026-8 Warning Notice Sensit~~de Intelligence Sources and Methods Involved NATIONAL SECURITY INFORMATION Unauthorized Disclosure Subject to Criminal Sanctions Classified by 005827 Exempt from general declassification schedule of E. Q. 11652, exemption category: g 5B 111, 121, and 131 Automatically declassified on: Date Impossible to Determine Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/fi~(';(~~=~tDP86T00608R000400120026-8 25X6 US~ESTI=RN EUROPE ? INTERNATIONAL ORGANIZATIONS This publication is prepared for regional specialists in the Washington cum rnunity by the Western Europe Division, Office of Current Intelligr nr:e, with nccasiona! contributions from othar offices within the Directorate ~( Intelligence. Comments anri queries are vr~elccrme. They should be cirrected to the authors of the individual articles. Madrid Sends Reinforcements to Spanish. Enclaves in Morocco 1 New Government in Faeroe Islands 2 25X6 3-4 25X6 5-6 25X6 . . 7-s West Euro~.eans Searching for Ways to Support Portuguese Moderates .ANNEX 9-1.0 UNCTAD Commodity Talks .1.7.-].7 Februarj 10, 1975 SECRET Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/14 ~EP86T00608R000400120026-8 25X1A Phony:: 143-5135 r4adrid Sends Reinforcements tc, Enclaves in Morocco Spain's move over the weekend in sending naval ' and marine reinforcements to its enclaves of. Ceut~~, and .Melilla on Moro,'s Mediterranean coast was evidently designed to make clear Madrid's rejection ' of Moroccan claims to the territories. Late last month, Rabat made a formal dema.rche to the UN Committee on Decolonization requesting an examination of the status of the Spanish enclaves. Moroccan Foreign Minister Laraki followed this with a call for the return of the two enclaves, as well as Spanish Sahara. The Moroccan move is seen as an effort by King Hassan to enhance his domestic prestige, now that interest in the Spanish Sahara question is diminishing, following referral of trat issue to the International Court of Justice. The Moroccan action on the enclaves provoked surprise, alarm, and near-unanimous indignation in Spain. Spanish military contacts 25X1X 25X1X in Madrid immediately stressed that, although Madrid intends to withdraw from the Sahara, it will never withdraw from the enclaves. Spanish officials are aware of the r vulnerability on the Ceuta and Melilla issue in the UN because of the strong influence exerted in that forum by the " - world nations, which support decolonization. Madrid believes that if Spain loses in the UN on this issue, it will ignore any subsequent resolution calling for withdrawal from the enclaves. The enclaves issue is also likely to affect Madrid's relations with th,~ US. Spain may raise this issue with the US in the negotiations that resume today in Madrid over renewal of US base rights in Spain. Spanish officials reacted negatively to news of US arms sales to Morocco during the Spanish-Moroccan dispute over the 5ahara,~and this bitterness may intensify. (Confidential No Foreign Dissem/Background Use Only) February 10, 1975 -1- SECR.ET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/1 ~~~P86T00608R000400120026-8 25X1A New Government in Faeroe Islands Two of the triree parties in the coalition 'government that came to power in the Faeroe Islands after the Danir~h elections on January 9, favor increased self-rule and ]lave taken a stand against allowing NATO facilities to remain in the islands. Despite the likelihood that the Faeroes will demonstrate increase3 assertiveness in ii.s relations with Copenhagen, the new coalition has agreed that no changes should be made in the f?undamer:tal relationship between the Faeroes and Denmark .for the ;text four years. Even if the question of,rIATO facili- ties is raised, Denmark is unlikely to relinquisY~ responsibil~.ty for t:~e islands' foreign relations and assuring their defense as a part of NATO. (Confidential Na Foreign Dis;~em) February 10, 1975 Approved For Release 2000/09/'i~~e~c~tDP86T00608R000400120026-8 25X6 Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 Next 5 Page(s) In Document Exempt Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 `7L V .l~ 1'~ ~.~y Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 25X1A 25X1A Phone: J.43-5135 Phone: 143-.5205 West Europeans Searching for Ways to Support Portuguese Moderates West European officials are expressing grow- ing concern about the drift to the left in Portugal, but are having trouble finding ways to lend support to moderate forces. Although confused by Portuguese developments, many officials believe that the future of democracy in Portugal depends on the elections taking place on schedule, not later .than April 25. The officials are aware of estimates giving the Portuguese Com- munist Party less than 10 percent of the vote. They nevertheless fear that the ~;ommunists may attempt to postpone or subvert the elections in order t;~ retain their appearance of strength. The actions by extreme leftists in breaking up a center-right party congress in Oporto last month received much attention in the European press, especially since representativES of several West European parties were them.. mhe inability of the Portuguese government to specify its aid requirements has frustrated the other Europeans in their attempts to provide direct bilateral aid to Portugal. The UK has embarked upon a modest assistance prugr?ani, howe~~er, and Norway is at present negotiating a technical assistance pact. Several EC capitals have expressed interest in a Dutch proposal to "untie" development aid to ttie former Portuguese colonies, thus allowing them to turn to Portugal instea~3 of ?~.he ci.~nor country for goods and services. February 10, 1975 -9- SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09~~ ~I~~~tDP86T00608R000400120026-8 The French, Danes, and Italians w~. to use EC channels to provide governmental assistance, but the EC Commission is reluctant to commit the community to any long-term preferential arrange- ments until the political situation in Lisbon stabilizes. EC Vice President Soames will visit Portugal this week to discuss the aid situation and to publicize EC inter?st in Portugal. ThP .i.ntent of this visit and that of UK Foreign Secretary Callaghan's last week is to provide moral support for Portuguese moderates. In the period prior to the elections, such visits by European leaders may provide the best means by which Europe can respond to Portuguese Foreign Minister Soares' recent call for support of plu- ralistic democracy in Portugal. The Dutch Socialist Party, meanwhile, has launched a campaign to collect funds for its Portuguese counterpart. social Democratic and Labor parties in the ~:~., Italy, and West Germany are also considering various forms of direct pax~+:y-to-party assistance. (Confidential No Fore_ gn Dissem) February 10, 1975 -10- SECRE~I' Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/14SFS~G~BI~P86T00608R000400120026-8 25X1A Phone: 1 3-5205 ANNNX UNCTAD Commodity Talks At this week's meeting in Geneva of the ~om- mittee on commodities of the UN conference on Trade and Development (UNCTAD), the developing states will take a major step in their effori:s to breathe life into the resolutions deman~3ir.g a "new economic order" which they have imposed on UN members. The over~;ahelming majorities enjoyed by the developing countries enabled these states, at a special session of the UN on development last spring and at the UN general assembly in the fall, to adopt steamroller tactics and force adoption of a Declaration for a New World Economic Order and a Charter of Economic Rights and Duties of States. Both included provisions unpalatak~le to most of the industrialized states. Other meetings are scheduled for this year and next on the problems of the developing states, the most important of which ar~~ another special UN general assembly in September 1975 and a major UNCTAD gathering in Nai~~bi in May 1976. This week's Geneva session comes on the heels of a meeting last week in Dakar of 70- odd developing states aimed at establish- ing a common position on commodity and develop- ment issues. At the Dakar conference, the participants recited their familiar litany of complaints over exploitation by the industrialized states. The developing states agreed to seek "economic emancipation through the recovery and control of their natural riches and resources and the February 10, 1975 SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/1~E(~,R~l,DP86T00608R000400120026-8 means of their economic development." They further pledged unity in the case of egression-- "economic or otherwise"--directed against developing states. The delegates endorsed the communique issued at last month's OPEC ministerial meeting in Algiers which calls for expanding the scope of a French-sponsored meeting of oil producers and consumers to include raw materials and development. The developing states also demanded that they be allowed to select their own partic- ipants in the meeting rather than allow Prance to invite whom it chooses. The principal debate in Geneva will be over an "integrated program for commodities" prepared by the UNCTAD secretariat i~. response to one of the provisions adopted at last spring's special UN session. The corollary issue o~ indexation--tying the prices for raw material exports to those of manufactured goods imported by developing countries-- will not be emphasized in Geneva because the developed states want to avoid the subject at all costs and the developing countries have agreed to give priority to the integrated program on commodities. In3exation will nevertheless return t~ influence future meetings on development because many of the developing states feel some such scheme is the only means by which they can maintain the earning power of their exports. Integrated Program The integrated program would establish international stocks for a number of commodities to be used to stabilize prices at remunerative levels for the producers. The stocks would be financed by a central fund to which producers and consumers would contribute. For commodity markets in which stockpiles could not provide stability or would be difficult to maintain February 10, 1975 SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 pprove or a ease STAN LEY by Murray Boll Continuing tho advonturos of tho Groot Palooolithic Horo "N11[A i1DR YOU TbrW6HT aoa u~sc you uaco One view of the development problem s~cx~;?r? Approved For Release 2000/09/14 :CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/1~~F~?DP86T00608R000400120026-8 the program would provide direct compensatory to developing states whose earnings from their exports decline below a certain level . The program implies that for some minerals producer cartels could maintain price levels. The draft program pays lip service to the need to consider consumer interests. The goal of the UNCTAD secretariat is tc~ secure acceptance now in principle for the program and get the details worked out before the UNCTAD Trade Development Board meets this summer. Developing States The developing states will certainly maintain, in Geneva, the united front they have been showing on economic issues in the UN. They are nevertheless not a homogeneous group and are divided by regional interests, ideological differences, disparity in levels of development and endowment in natural resources. Radical elements among these states have led the developing country bloc in demanding recognition of its new power and influence. These countries are likely to insist on a rapid adoption of the commodities program, or even more radical programs. The moderates are nevertheless cautioning that the developing countries do not have very much real power outside of the UN forum where they hold an automatic majority and that adoption of radical positions only increases the resistance of the industrialized states to cooperating in multilateral development plans. The moderates also realize that exploitation of commodity issues is shaky ground on which to attain developing country solidarity, since not all developing states are commodity producers. Moreover, some of the industrialized states are also exporters of raw materials February 10, 1975 SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/14~~~1~1?86T00608R000400120026-8 and stand to benefit more from commodity arrangements than the developing countries. Still, the moderate: states have not yet broken solidarity with the developing- country bloc on economic issues and are not likely to do so in Geneva. They see little alternative offered by the developed countries to help tY~em face their economic problems. Moderate elements lack an effective spokesman for their position and the radicals, led by Algeria, have remained well organized and prepared to meet internal and external challenges to their leadership. Last week's meeting in Dakar, Senegal reflects this; Algeria financed, organized and set the agenda for the affair. Senegal--along with the other moderate developing states--found itself car- ried along in support of radical positions at a meeting held in its own capital. Looking for an alternative to the radical positions, the moderates could seize on certain provisions in the recently negotiated trade and aid agreement--to be known as the Lome Convention--between the EC and 46 developi:~g states. The agreement commits the EC to protect the developing states' purchasing power earned from exports of 12 commodities to the EC. Formal agreement to this provision is the first such accord between developing and developed states, and the moderates may point to this concession, reached by negotiation, as a more concrete achievement than any reached by the confrontational tactics of the radicals. The latter may well argue that the EC agreement ~.~ limited in scope and that a stronger version of its provisions have in any case been incorporated in the proposed integrated commodity program. February 10, 1975 SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/1 SECR~P86T00608R000400120026-8 Developed Country Attitudes The industrialized states met in late January a.n the OECD to coordinate their position for the Geneva meeting, agreeing to maintain a common front and to avoid confrontation with t't~e developing states if possible. Many of the industrialized states are themselves interested in some mechanism that would lend stability to commodity markets. They are also concerned that the success of the oil producers may encourage the development of other commodity cartels. The emphasis cif the industrialized countries will thus be on gaining multilateral and bilateral guarantees of access to raw materials. While they will consider the commodity program in a "positive perspective," the industrialized states have agreed to take a slow approach. They want more time to study the program and point out that the proposal is both complex and would be difficult to admi.zister as present?y conceived. They want to be sure that the commodity program would not be ~:sed to support prices above long-term equilibrium levels but only to smooth out temporary Price fluctuations. The EC countries, for their part, may seek political capital in Geneva from their concessions in the Lome Convention on earnings stabilization, claiming that the agreement shows that the community is taking the interests of the developing countries to heart. Although most of the 46 states that signed the agreement with the EC are traditionally members of the moderate camp among developing states, the debate on commodities has not approached the point where the solidarity of the developing states wi].1 be seriously tested by calculations of economic benefit. While eager to curry February 10, 1975 SECRET Approved For Release 2000/09/14: CIA-RDP86T00608R000400120026-8 Approved For Release 2000/09/'~~'I~'DP86T00608R000400120026-8 favor with developing states when possible, the EC is not likely to break ranks with the other induEtrialized countries in their cautious approach to the proposed commodity schemes. (Confidential No Foreign Dissem) February 10, 1975 SECRET Approved For Release 2000/09/14 : IA-RDP86T00608R000400120026-8