PORTUGAL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00353R000100340003-6
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 3
• Document Creation Date: December 16, 2016
• Document Release Date: January 11, 2005
• Sequence Number: 3
• Publication Date: November 10, 1976
• Content Type: REPORT

CONFIDENTIAL
Approved For Release 2005/03/24: CIA-RDP85T00353R000100340003-6
The idealistic young military officers who overthrew the
Caetano regime in April 1974 wanted a change from the rightwing
dictatorship that had prevailed for 50 years, but their political
naivete and confusion over what to replace. it with kept the,
country in a state of turmoil for over two years. The inaugura-
tion last. summer of a new government and a freely-elected
president, General Antonio Ramalho Eanes, marked the victory
of those who advocated democracy over those who hoped to
install a Marxist state.
The Government: The Socialist minority government of Prime
Minister Mario Soares, after more than three months in office,
is coming under increasing criticism from both sides of the
political spectrum, from a military ready to step in whenever
it feels threatened, and from President Eanes, who wants
tougher economic action than the Socialists have been willing
to take so far. Time is running out for Soares to show he
can tackle Portugal's problems, although a change in govern-
ment is unlikely before the end of the year.
The Soares government has introduced a modest austerity
program and has made an effort to correct abuses of the
agrarian reform program by returning some illegally occupied
lands to the original owners. Legislation is under way to
regain some control over labor by clamping down on absenteeism
and politics during working hours.
Stronger actions will have to be taken if the government
hopes to make a dent in Portugal's economic problems and
ensure its own survival.
--The Socialists have proceeded cautiously so far to
avoid aggravating divisions between the left and right
wings of the party and setting off Communist-inspired
protests against harsh austerity measures.
Approved For Release 2005/03/24: CIA-RDP85T00353R000100340003-6
 CONFIDENTIAL
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--The elimination of leftist Socialists from the cabinet--
the agriculture minister resigned last week--may make
it easier for Soares to implement the relatively
conservative measures needed to place Portugal on the
road to recovery. The extent of the Prime Minister's
resolve is open to question, however.
The Opposition: The Communists thus far have shown little
interest in fomenting unrest against the Socialist government.
--They appear to be directing their energies toward
rebuilding their power base, which has dwindled
with the party's loss of political standing last
year.
--Communists still hope to eventually-gain control of
the government, but they probably realize they are
not now in a position to take advantage of a Socialist
government collapse if it should occur.
More strident opposition has come from the two parties
to the right of the ocentrist Dheotic
con-
Party, formerly known as
servative Social Democratic Center.
--Both are undoubtedly trying to shore up their own
images for the local elections to be held on December
12, in which they hope to pick up enough support to
convince the Socialists to form a coalition government.
The Military: The armed forces, still the ultimate arbitertofal
power in Portugal, are frustrated with the continuing p
bickering and the economic temporizing of the Soares administra-
tion. The armed forces suffer from internal dissension them-
selves, however, and a growing number of professional complaints
are complicating the longstanding divisions between left and
right.
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CONFIDENTIAL
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The President: President Eanes is concerned about the slow
pace of economic recovery and the failure of the Socialists
to take more dynamic steps. Should the Socialists fail to
resolve their internal differences, Eanes may consider taking
action himself.
--He would probably avoid a government change before the
local elections, but if the situation has not improved
by the beginning of the year, he may demand that the
Socialists broaden their support through a coalition.
--Other alternatives may include returning to a military
junta or Eanes' assumption of more powers for himself.
His commitment to the constitution appears real, how-
ever, and he would probably try another civilian govern-
ment before resorting to military rule.
CONFIDENTIAL
Approved For Release 2005/03/24: CIA-RDP85T00353R000100340003-6