STAFF NOTES: WESTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86T00608R000500030025-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 11
• Document Creation Date: December 16, 2016
• Document Release Date: March 8, 2005
• Sequence Number: 25
• Publication Date: December 22, 1975
• Content Type: REPORT

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The Two Germanies Conclude "Package Deal" to
Facilitate Transit Traffic to Berlin . . . . 1
UK-Deland Cod War Cools Off . . . . . . . . . 3
Tax Issue Provokes Coalition Impasse in
Finlard . 4
Austria's Security Measures Questioned . . . . 5
ANNEX
Portuguese Non-Communists Work to Enhance Role
in Organized Labor . . . . . . . . . . . . . 7
December 22, 1975
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25X1
The Two Germanies Conclude "Package Deal" to
Facilitate Transit Traffic to Berlin
The East and West German governments concludc&3
the long-awaited package deal to improve road
and rail routes to Berlin, on December 19--one
day later than scheduled. The delay probably
was caused by 'East German bureaucratic difficult.:Les
in processing the final documents, and not by
the growing controversy about reports that East
German authorities have put up for adoption
children whose parents have tried to escape
to the West.
Schmidt's decision to ignore opposition
criticism over the forced adoption controversy 25X1
and to sign the agreement reflects his basic
satisfaction with the package deal.
On balance, tLe government will probably
deriva more political advantages than disadvantages
from its decision to conclude the transit accord.
.December 22, 1975
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The Christian Democrats will continue to hammer
on the adoption issue, arguing that the Schmidt
government has mismanaged the entire scope of
inter-German relations. The package deal promises,
however, to facilitate transit traffic to 'West
Berlin and is a strong affirmation of Bonn's
determination to support and develop ties with
the city.
December 22, 1975
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UK-Iceland Cod War Cools Off
The approach of the Christmas holidays has
produced a lull in the almost daily skirmishes
recently between Icelandic patrol boats and British
trawlers inside Iceland'-- unilaterally declared
200-mile fishing zone. The only incident in the
week-long lull occurred on December 18 widen an
Icelandic Coast Guard ship cut a trawl wire of
a British fishing vessel 26 miles from the coast
of Iceland. The Icelandic boat reportedly was
then chased from the area by several British
trawlers.
The withdrawal of most British trawlers
from the contested waters during the holidays
will give the Icelandic and British governments
another chance to negotiate a settlement in a
calmer atmosphere unburdened by the pressures
and publicity resulting from incidents between
vessels of the two countries. Unless both sides
make serious efforts over the holidays to get
the stalled negotiations going again, however,
the cod war is certain to heat u when the British
vessels return.
December 22, 1975
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25X1
Tax Issue Provokes Coalition Impasse in Finland
Disagreement over a minor tax issue may lead
to a Communist withdrawal from Finland's three-
week-old coalition government.
The impasse between the Communists and the
other four coalition parties developed after Communist
coalition negotiators persuaded the other government
parties to agree to a modified tax on automobiles and
gasoline. The Communist Party leadership, however,
later disavowed its own parliamentary group and re-
jected the proposal. The Communists then called for
another round of negotiations on the issue.
An exasperated Prime Minister Miettunen said
that he will consider the Communist proposal for
another round of negotiations and announce his de-
cision on December 29. If he rejects another round
of negotiations and the Communists vote against the
modified tax proposal, they could be asked to leave
the government. WIthout the Communists, the remain-
ing_parties--the Social Democrats and three center
parties--would retain a majority in parliament.
As in most areas of Finnish politics, President
Kekkonen will have the last word. In a surjrise
move three weeks ago, he upstaged governmentz forma-
tion efforts by ordering the Communists and Social
Democrats to join a government. Kekkonen feels that
a broadly based government is needed to tackle
Finland's critical economic problems. A Communist
withdrawal from the government at this time could
force Kekkonen to intervene again.
December 22, 1975
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Austria's Security Measures Questioned
Chancellor Bruno Kreisky is defending his handling
of the OPEC terrorist incident in the face of strong
criticism at home and abroad. Within 24 hours, Kreisky
had granted all the terrorists' demands, including
publicizing their polemical statements in the local
media and providing a plane to fly the terrorists and
their hostages out of Austria today. Several Arab
countries have criticized Austria for failing to provide
adequate security measures for the top-level OPEC meeting,
and some of Kreisky's political opponents have scored
him for giving in so easily.
The Chancellor rejected the critics' charges and
said the action had been taken at the express wish
of the ambassadors of the countries involved. According
to Kreisky, he had rejected long, drawn out negotiations
because there already had been casualties and the safety
of the hostages would have been further jeopardized
if the government delayed granting the concessions.
He said it was virtually impossible to prevent such
terrorism.
This is the second time Kreisky has caved in to
terrorist demand;. In 1973 he ordered the closure of
a Jewish transit camp to save the lives of four hostages
held at the Vienna airport by two Arabs. A similar
camp was subsequently opened, however, and continues
to process transient Soviet Jews.
Kreisky may have to improve security arrangements
for OPEC and the numerous other international organizations
that are headquartered in Vienna. Indeed, Austrian
hopes to turn Vienna into another "UN city" will require
them to be more responsive to foreign demands, inter
December 22, 1975
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alia, for better security. The main opposition party,
the Austrian People's Party, is usually at pains to
find flaws in Kreisky's policies and may zero in on
the security issue, pointing out the defeciencies which
have left the government virtually helpless two
occasions.
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December 22, 1975
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Annex
Portuguese Non-Communists Work to Enhance Role in
Organized Labor
Non-Communist forces in Portugal, firmly in
control of the government since the unsuccessful
uprising by leftist paratroopers on November 25,
are mounting a serious challenge to the dominant
position in organized labor that the Portuguese
Communist Party achieved following the overthrow
of the Caetano regime in April 1974. The non-Com-
munists' chances for improving their standing with
labor are good, barring disastrous economic develop-
ments which could threaten political stability.
The Communists' early advantage was the result
of adroit maneuvering rather than popular strength.
The Communist Party was the only opposition political
group to maintain an effective underground organiza-
tion during the Salazar and Caetano regimes. After
April 1974 the Communists quickly took over the
local union set tip under the corporate state system
and replaced the government hacks in it with young
pro-Communist workers.
The Communists also sought to legalize their
preeminent position when the other political parties
began to compete with the Communists in the individual
unions. To that end, they strongly supported the
unitary labor law promulgated in April 1975 after
several months of heated debate. Under the law,
only one labor confederation--the Intersindical--is
authorized and it has exclusive rights to affiliate
with international labor organizations.
December 22, 1975
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Even though the Socialists and other anti-
Communists could not block this legislation they
did manage to bargain the adoption of several.
favorable provisions, including the freedom for
unions not to join the confederation and the require-
ment for new secret ballot elections for union
leadership. These concessions, coupled with the
non-Communists' victory in constituent assembly
elections in April 1975, enabled the non-Communists
to pick up support from many unions. In several
union elections, the Socialists joined forces with
the far-left, but virulently anti-Communist,
Reorganizing Movement of the Proletariat Party and
gained control of most of the white collar unions.
The Communists retain the advantage among blue collar
workers--particularly in the Lisbon industrial area.
Although it has suffered a series of setacks
in recent months, the Portuguese Communist Party
retains suffic..ent labor strength to make trouble
for a government which is trying to stave off economic
collapse. Fed on Communist slogans since April 1974,
Portuguese workers have come to expect a higher in-
come for much less work. Government officials fear
that if foreign economic assistance is not forthcoming
soon, the severe economic restrictions they will be
forced to adopt will provoke labor unrest that could
again tip the power balance in favor of the Portuguese
Communists. The critical foreign exchange situation
threaten: to bring things to a head early next year,
when reserves are expected to run out.
The government seems strong enough now to begin
implementing some of the needed austerity measures.
But before the November 25 military uprising, the
Communists--with minimum representation in the
government--had managed to paralyze the government
through the effective use of labor support. Com-
munist-led construction workers besieged Prime
Minister Azevedo's residence on November 13 and
forced him to retreat on wage constraints. Government
December 22, 1975
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officials fear that unless they receive outside help,
the deteriorating economy will give the Communists
an issue on which they can rally popular support
and replay the challenges of early November.
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The new constitution, now being drafted by a
constituent assembly in which non-Communists have the
majority, will presumably reflect the government's
final decisions with regard to labor organizations.
The draft articles approved by the assembly in October
provide for th,s free formation of labor organizations
at all levels and the right to affiliate with inter-
national labor organizations.
The constituent assembly has also sanctioned
another type of labor organization--the workers
commission--as an alternative to Communist-controlled
unions. The commissions are designed to serve a
liaison function to management and government, while
the unions retain responsibility for contract negotia-
tions. The advantage of the commissions is that they
represent the workers of an entire company, whereas
the same company may have as many as 30 f n,40 separate
un i one
December 22, 1975
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