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Document Creation Date: 
December 9, 2016
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February 14, 2000
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September 1, 1975
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Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 Secret Nn l~nrei~~a l7~iirm Communist Aid and Trade Activities in Less Developed Countries, August 1975 Secret ER RP 75.29 Septomber 1976 Approved For Release 2000/09/14 :CIA-RDP86T00608RQfb~5~230P~2~'~ Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 NATIONAL SCCURITY INFORMATION Unaut~horizod Disc~oauro Subject to Criminal Sanctions CIr??Illyd by 019710 !?rn+M Irom prn?nl d?cUUIlkNbn ?ch~luN o/ ! O. I lED7, ???mplbn crl?pory: 4 btll l>, 171, rnd IJ) _~ulornNkN-r Oa1ruNMd oe~ DN? Impo?~fbM l0 ONMmM? Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRt:T Nn /~~relKn Dln+eam CON'I'lsNl'S AND SUMMARY OIL CsVI3N'I'S (August I y7S Iligltliglttx ? '1'Itc USSR apparently signed a contract to dcyign st sts;el plant in Nigeria. o 'i'hc USSit sul'1'crcd st setback when h;unusc;us announced that Soviet coil exploration prrsonnel will be rcpbteed with teehnic!tuts from the West. ? Itomunist mctvcd to cement relations with I:gYht and Irsut through protocols tc~ implcntent a number of large development prcrjccts. Continuing Communist Tnnk Deliveries to Libya I 25X1 D i'c~land and the USSR drlivc?red^mcdium t;tnks to Tripoli in August. USSR Signs Ccmtracfs on Steel Mill in Nigcrin 1 'The USS1t rcportrdl, signal a contract to clcsign a I .S million metric tort steel cornplcx in Nigeria, under study r~ncc 1 ~?!:?. G.ech Maintenance Support to Indctnesinn Air force 1 A C'~cch maintenance learn is in Indc~nrsia supervising thr overhaul cf L-~~) jet trainrrs unelrr a Srptrmhcr 1':?~ protocol. Mexico Signs Coopern ion Agreement with CE1NA .. 2 In August, Mexico srgned a general cooperation agreement with the Council for Mutual Economic Assistance, similar to the pact signed by Iraq last rnontlt. Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 ~~~RDP86T00608R000500230028-3 Nn ro-~IKn Dlaerm 1)rlivrrirs Under Savirt-Pcrtr;irtn Military Conlracta Nearly C'umplrtr .. 2 Moscow has larl!ely complelccl equipment clclivcricr unclcr n I')7:~ f!rour+~' forces al!reentent, :rs well as rnusl cti' Ihc~Ml-Ks unclcr ar A,Itril contract. 25X1 D Near Istwt and South Asia Ilangladrsh Tu Repay Suvict Wheat Lunn 3 13angladcsh plans to h~ty 4U,t7UU tans of wheal on Western markets th4~. yc:rr ;ts :; first payment nn :r Sctvict wheat Ie;an. Rontania L?:xpands 'a'irs with Egypt curd Iran . . 3 Rontania signal protocols in August to inrplemcnt a number of large drvrlopntent projects in I?gypt and Ir:ut, two of its m,ijor air) recipients. Palish Military Drlivcrics to India 4 The second of four medium-class tanning ships ordcreef in 197 is er route to India, and delivery of trainer aircraft is hclicval imminent. lrnq Receives hurthcr Sctvict Aircraft hrlivcrics .. S 25X1 D 'I'hc arrival ofd MI(.-?3 jet I~it;hters in /lukust hrint!s lh: r r~m;tcr of M1G-23s in the Iraqi air force lo. cnout!h to equip at Ic,cst tLrr.c squadrons. 25X1 D Kuwait Military Negotiations with the USSR . . 5 Official kuwaiti sources denied n?pctrls Thal the USSR ha~~ n?fused to supply arms to Kuwait. First Sctvict Prtya `'lncs I)esUoycr [scort to Syria S On ~S July. Syria received a ('rtya ll class dcstrayer, now the larl!rst comhatant in the Syrian inventory. Approved For Release 2000/09/14 : QdA-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 :~~~.-RDP86T00608R000500230028-3 Ne ForelKn l)luem Ih1~;C Syrin'1'u fL'nd Soviet Petroleum Activity 5 Syria's oil rrlinisler Ilnnouncc~ in -nill-August that Soviet ail cxpl~~rsltion ncaivitics will he terminated in favor of WCStCrfl-type conccasion ~rr~ng~- I11Cilts, ~tI1Cr AetiVitiC9 Military ... 9 w Approved For Release 2000/09/14y~~~4-RDP86T00608R000500230028-3 Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 st:caET Nrr l~o-rlkn. I)L+,+rrrn C;UMMl1NIS'I' /111) ANU 1'12/11)I? /1C'I'IVI'I'ICS IN 1.1?SS I)L'VL::LUI'I~I) COUN'1'Itlf?S /t.tric~a Continuing, C'ornrnunist 'I~nnk I)elivcrica to Liby,~ 25X1 D Poland and thr. USSR dcliverc:cl^ medium tanks to Tripoli in Auf;ust, bringing the number of Cornrnunist rnedit--n t.rnks supplied to Libya sinrc 1910 to rnurc rh~ur I,000. Althouf;l+ army units arc believed to be using only about 200 tanks, the Warsaw fact c~~xu~tries arc cxpcr_tcd to deliver an .additional 1,000 tanks by rnid-1977. (Secret No;n I)issr.rn) USSR Signs Contracts on Stccl Mil! in Nigeria The USSR arrd Nigeria rr.c:cntly signed contracts for designs and training facilities for along-awaited l.5 rnillian ton steel complex at Ajaokuta. In the plnnnint; stage since 1967, the project has cnrountcred long delays becaue of c:~ntroversy over location and size and questionable availability of raw rnatcri.,ls. Current total cost cstirnates for the plant, including a large allocation fur infrastructure, ranf;e as high as US $1.3 billion. (Sccrrt No F~orcign I)isscrn) East Asia Czech Maintenance Support to Incl~nesian Air Force A Czech rnaintcnancc tca-n, in lndoncsia since early this year, is supervising the complete overhaul of L-29 jet trainers purchased by Note: Ttie substance of this publication has been coordinated with the Bureau of lntelligcnc~ and Research of the Dcpartrncnt of State, with the Defense Intelligence Agency, and with the Agency for International Development. Comments Lnd queries rc ardin this publication arc welcomed. They may be directed to of the office of Economic Research, Code 143, Cxtension 5291. 25X1A Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET September 1975 Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET Indonesia in I9G4. All of Indonesia's L-29s arc ~~;;;~ectcd to be refurbished by year's rnd under a September 1972 aP;~ccrncnt that provides engines and spare parts for Indonesia's It oi:~i~ationai L-29s. Jakarta has made an exception to its policy of not accepting military support from Communist countries, because of the L-29s' importance to Indonesia's Air Force. TI1C Czech aircraft is the most advanced jet trainer in Indonesia's inventory. (Secret No Foreign Dissem) Lat[n America Mexico Sipns Cooperation A~rcemcnt with CEMA On 13 August, Mexice~ signed a cooperation agreement with the Council for Mutual Economic Assistance, calling for the establishmec~t of a joint commission to explore cooperation in oil and natural gas. The agreement appears to be general in nature and probabl;~ is similar to one signed by Iraq last rnor:th. (For Official Use Only) Deliveries Under Soviet-Peruvian Military Contracts Nearly Complete During July and August, Moscow continued to fulfill its military agreements with Peru and tried to interest Lima in additional arms purchases. (Confidential No roreigiti Gisscrn) 25X1 B Peru recently took delivery of at least-tracked artillery prime movers and 130-mm field guns, which along with - T->5 tanks previously delivered Nrobably fulfills most of the contracts under the 1973 accord for ground forces equipment. Soviet and Peruvian technicians also were assembling somt~ of the M1-8 helicopters delivered under an April contract. An estimated 30 Soviet military personnel were in Peru at the end of August. (Secret No Foreign Dissem) 25X1 B 25X1 B Approved For Release 2000/09/14 ~E~I~-RDP86T00608R000500230028-3 Approved For Release 2000/09/14 : ~I~TRDP86T00608R000500230028-3 Durinh a heruvian naval ~.;::Icgc~tion's recent visit to Moscow, the USSR probably tried again to Soli Osa class guided mis,-ile pa?lrol boats and has invited Pcr?u's mii7i~~ter :.~ *'~~ ri-avy to Moscow to follow up these conversations. Howes-er, initial indications arc that Peru will not purchase these hoots. The USSR hopes that Peru will ~~cc~.rt iYs of{er of MiG21 jet fighters, but Lima a~;,~,cars satisfied with the avail:~.'.;ty of Western aircraft. (Secret No Foreign Dissem) Near East and Soup h Asia Bangladesh To Repay Soviet Wheat Loan Bangladesh will buy 40,000 tons of wheat on Western markets this year to make its first payment on a 200,000-ton Soviet wheat loan. According to the agrecrricnt the Soviet wheat, valued at $35 million where it was shipped in 1973, is to be repaid in kind over five years begin~~ing in 1975. Because of reduced world market prices for wheat, this y?:~r's repayrrcnt to the USSR will cost less. Nevertheless, the repayment will contribute additional strains on Gacca's already poor balance of payments. (For Official Usc Only) Repayments to the USSR also raised questions about future US PL 480 wheat deliveries to Bangladesh. Under existing regulations, the United States cannot provide commodities under its PL-480 program to LDCs that will export the same commodity during the year. However, PL-430 deliveries will be continued if Dacca buys the wheat in the llnited States for direct shipment to the USSR. The Unitod States already has allocated 450,000 tons of grain under the PL-480 program for Bangladesh in fiscal 1976. (For Official Use Only) Romania Expands Ties with Egypt and trrn Roman: signed a series of protocols in August to expand existing economic relati~~ns with Egypt and Iran. The new accords underline 3 Approved For Release 2000/09/14 ~~~-RDP86T00608R000500230028-3 Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET Romania's drive to expand equiprnent rriarkets in tlic Ncar East.About one- half of E~ucharest's $1.3 billion In Third World aid has been concentrated in this are~n. (For Official Usc Only) A protocol with Cairo calls fora joint itomanlan-Egypt!an bank, Romania's first such venture in the Third World. The bank, to be located in Egypt, is capitalix~~d at $25 million with 49~G Romanian ownership. Under Egyptian law, the bank will be pcrrnltted to conduct transactions in local and foreign currencies. Industrial agreements signed at the same time call for implementation of projects agreed to under earlier credits: soda and sulfuric acid plants, the Hamrawein phosphate complex, a petrochem- ical project, and an agricultural complex. Romania offered $100 million in new development credits to be made available when the $125 million worth of air still outstanding under existing rredits is drawn. (For Official Use Only) Romania signed agreements with Iran to provide cement plants, bakeries, machine tool plants, and a sodium silicate plant. Technicians will undertake feasibility studies fo~? expanding a chemical plant at Shiraz, electrification of the Dandar Abbas railroad, building an oil refinery and petrochemical plant, and prefa~ricated housing projects. Aid to agricul- ture also will be increased through the construction of grain silos and cold storage facilities in Iran. (For Official Use Only) Polish Military Deliveries to Ind~it~ the second of four Polnocny class mediu-~ landing ships ordered from Poland in 1973 has been sent to India. The unit will be used primarily for logistical support for the development of milit~iry bases in the Andaman and Nicobar Islands. (Confidential No Foreign Diss~m) Delivery of the first batch of Polish TS-11 Iskra trainer aircraft under a March contract also is imminent. The original order, which called for- 25X1 B 4 Approved For Release 2000/09/14 ~?~R~ RDP86T00608R000500230028-3 Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET 25X1 B TS-! ls, is believed to Itavc been increased The aircraft were offered at $315,000 each, as part of an unspecified barter arrangement. (Confidential) Iraq Receives further Soviet Aircraft Ucliveries 25X1 B 25X1 B A Sovlct mcrcl~ant ship carryin~MlG-23 (loggers and-MIG- 21s arrived at the Iraqi port of Urnm Qasr in late August. This delivery will bring the number of MIG-23s in the Iraqi air force --- enough to 25X1 B equip at least three squadrons. The total number of MIG-21s now stands at 25X1 B about- The shipment provides evidence that the USSR is Honoring prior military agreements with Iraq, despite the strains that have developed between the two countries. (Secret) Kuwait Military ~le~otiations with the USS[t Official Kuwaiti sources c'Qnied reports that the USSR refused to supply arms to Kuwait during the August visit of a military delegation to Moscow. E~~:ier this year, the Kuwait press reported a Soviet offer to exchange military equipment for crude oil. (Unclassified) First Soviet Petya Class Destroyer Escort to Syria Syria apparently received a Petya I[ class destroyer escort from the USSR on 25 July. The Petya becomes the largest combatant in the Syrian inventory. Besides Syria, only India has received an export model of the Petya II, armed with two twin 76.2-mm gun mounts, two five-tube 21-inch torpedo mounts, and two 16-ba~~rel 200-mm ASW rocket launchers. It also has a minelayirg and dep~h-charge capability. (Secret) Syria To End Soviet Petroleum Activity Syria's oil minister announced in mid-August t{~at Soviet oil explora- tion activity has failed to meet expectations and that Lamascus would Approved For Release 2000/09/14 : CIA-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 : ~~tDP86T00608R000500230028-3 terminate Soviet-assisted oil exploration in favor of Western-type concession arra~~gements. (Unclassified) Under recent concessions granted to Western firms, Syria will repay exploration and development expenses from production only If oil is found. Under the Soviet program, Syria must pay for Soviet equipment and services even if the venture fails. Beyond the possible financial advan- tages, however, Western technology is considered superior. (Unclassified) Nonetheless, Soviet credits t:,taling $50 million, have been the major support for establishing Syria's national oil industry, an industry that currently produces about 1G0,000 barrels a day. (Unclassified) OTHER ACTIVITIES Economic Africa Mozambique. East Germany signed an agreement on 13 August to provide Mozambique with assistance in animal husbandry and other agricultural projects. Like other Communist countries, East Germany has moved quickly to provide aid to the new government. Prior to independ- ence, East Germany offered $S million in economic aid, possibly for budget support, as well as aid for establishing a na ~ionai police service. (Secret Nei Foreign Dissem) Ni eria. Nigeria is preparing to negotiate contracts with Poland for the expansion of shipyard facilities at Apapa. Polish technicians appar- zntly completed studies for the expansion early in 1975. (Secret No Foreign Dissem) Somalia. A Somalian fishing industry official was in Moscow during August to negotiate implementation of fisheries projects under a recent Approved For Release 2000/09/14 : CIS RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET $60 million Soviet credit to Somalia. (Unclassified) Sudan. Sudan announced in August that a Bulgarian delegation is expected soon in Khartoum to sign a $20 million credit agreement. 1"he accord probably will reactivate 1967 credits that have gone unused. Sofia probably plans to go ahead with meat and vegetable processing facilil;ies called for under the original agreement. (Unclassified) U anda. The USSR presented a preliminary mineral exploration rel-ort prepared by Soviet geologists in Uganda earlier this year. This is the first reference to Soviet assistance to geological exploration in Uganda. Further Soviet activity in this field probably would require now credits, as most of the $15 million in aid previously provided has been used. (Unclassified) Zaire. At a meeting of their joint commission in mid-August, Romania and Zaire discussed forma ion of a joint agricultural and livestock development company. (Unclassified) Latin America Bolivia. Bolivia has approved the final designs for a second Soviet tin volatization plant, with a total cost of $15 million. Installation of the first unit at Potosi has been plagued with delays and cost overruns. Original estimates put the cost of each plant at $8.5 million, of which $6 million represented Soviet equipment to be financed with a $28 million Soviet credit. (For Official Use Only) Dominican Republic. Romania has purchased $16 million worth of sugar from the Dominican Republic so far this year. Trade between the two countries previously had been negligible. (Unclassified) Jamaica. A Chinese textile team arrived in Jamaica in mid-July to study several textile projects first discussed when Jamaica established Approved For Release 2000/09/14 : Cld-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14~K~4A-RDP86T00608R000500230028-3 diplomatic relations wltli China in March 1974. (Eor Official Usc Only) Colombia. Colombia signed contracts valued at $21 million to purchase buses from Hungary and streetcars from the USSR. The National Federation of Coffee Growers is ~3cting as Intermediary In ~thc $12 m111Pon Soviet deal and will finance the sale of streetcars to Bogota over 10 years at 15916 Interest. The hiungarian buses will be financed under a trade agreement. (Unclassified) Chile. China has entered nrgotiatlons with Chile to purchase chemical products, presumably nitrates. Last year, Chile sold about 65,000 tons of nitrates to China, but shipments in 1975 have been negligible. (Unc!: sslfied) Near East and South Asia Afghanistan. On 22 July, Czechoslovakia signed a $6.5 million aid contract to provi~tA b~.rses for a transportation project in Kabul and agreed to assist a powerplant 3t Herat. (Unclassified) Egypt. Egypt recently announced the completion of two poultry combines, a vegetable dehydrating plant, and a meat processing plant constructed by Bulgaria under credit agreements valued at $37 million. (Unclassified) Iran. The USSR signed a contract on 6 August to begin electrification ~~f the 90-mile rail line from Tabriz to Julfa, on the Soviet border. Th~+ USSR extended $18 million in credits in 1968 for rehabilitation of the line. (Unclassified) Iraq. Poland signed a $3 million contract to supply two pumping stations on a turnkey basis far an irrigation project in Iraq. The Iraqi government eventually plans to purchase 8U pumping stations fora $400 million irrigation project, and Warsaw is interested in establishing itself as Approved For Release 2000/09/14 8 CIA-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 SECRET a reliable supplier of this type of equiprncnt through rapid delivery on this contract. (Secret No Foreign I~issrrn) Pakistan. Cl~inesc experts arrived in Pakistan rarly in August to work out final details on construction of a sports complex rat islarnabad, scheduled to begin in UctUbcr. The $35 rnillion complex, to nc cornpletcd for the 197G Asian Garr~c~t, is tieing financed under a 1970 credit far $7.00 million. The two sidrs also recently agrcrd to start work on a $2,9 million textile cornplex i!r Punjab under t~~~~ same credit. (Unclassified) Sri Lanka. At the close of trade talks in Moscow in August, it was announced that Soviet-Sri Lankan trade is planned to increase by S0~', in 1975 to approximately $2G million. Aid deliveries for expansion of tl~c Scviet-built Oruwala steel rr~i!1 will contribute I~eavily to the increase in Soviet exports, while Sri Lanka wily expand shipments of traditional agricultural goods. (Unclassified) S ria. Czechoslovakia signed a contract on 30 July to equip a $105 million fire plant at Hama. The financial arrangements for the project were not revealed. (Urrclassificd) Militate 25X1 B Guinea. The USSR delivered- M1G-21 aircraft and military vehicle4 to Conakry during August under a 1973 agreement valued at $20 million. The USSR previously had delivered -M1G-21s to Guinea this 25X1 B year. (Secret No Foreign Dissem) A Guinean delegation headed by the minister of defense visited Bucharest in mid-August at the invitation of P..omanian military officials. (Unclassified) Approved For Release 2000/09/149 CIA-RDP86T00608R000500230028-3 SECRET Approved For Release 2000/09/14 : ~~I~~~tDP86T00608R000500230028-3 25X1 B 25X1 B Guirteacr i) The nurnbcr vt Soviet-supplied MIG-7.1 ie5 fighters in Guinea I)issau rnsc-with the arrival- additional aircraft in August. The delivery probably rorne; under an apreerncnt conr.luded by a Soviet military delegation to Guinea last (all. (~ec-ret No I'oreipn hissem) Mali. The 1.155(1 has rxpandrd military deliveries to Mali over t!~e past threr months. A Soviet ship arrived i-i (:onakry with tanits, AI'Cs,- truck-mounted rnissilc muncher destined for Mali. (n May and June. Mali received- M(G~-! 7s and a- trainer under a (k~cernbrr 19yri ngrcrmcnt. ('NCrct No (?'or~cign Discern) 25X1 B Laos. Soviet-supplied Laotian river patrol boats reportedly have appeared for the first time on the Mekong 1livcr borderir-g Thailand. The boats probably were delivrrcd in May and .lone to he used to control smuggling and illegal border crossing. (Un~-lacsificd) Near East and South Asia 25X1 C India. Nanuchka class gaited missile patrol boats arc among the combat ships New Delhi will receive under the t~cbruary 195 Soviet- (ndian arms agreement. The Nanuchica is armed with SS-N-9 surface-to- suriace missiles and SA-N-4 surface-to-air missiles. Some of the s.vpd~icti- cated weaponry probably will not be provided far the export model. 25X1 B 25X1 B 25X1 C Approved For Release 2000/09/14 :CIA-RDP86T00608R000500230028-3 !0