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C-O-N-F-I-D-E-N-T-I-A-L00-B-321/33415-72- 2 -2.  During the same private conversation, General Oswaldo Lopez Arellano was quoted as having stated that it would be futile for him to lead a coup d'etat unless there was hope of improving the welfare of the masses and the general economy of the country as well; he firmly believes it would be impossible to accomplish that goal until a change in most of the above conditions were met prior to any coup d'etat in which he would be interested.3.  Selected Honduran army officers have attended special courses at an army facility in Peru since approximately 1967. According to an army officer the number of candidates sent since early 1972 has not only been increased but also each has been ordered to specialize in any one of the branches of their choice. They previously attended the various courses given at that facility.4.  The army gives an outward appearance of being in sympathy with the present regime, but in reality not all the members sympathize with President Cruz. In private conversations some speak of him in a derogatory manner, espec- ially young officers.5.  A man who continues to wield a great deal of power in Honduras is Ricardo Zuniga Augustinus, Minister of Government and Justice, also leader of the Nationalist Party. Zuniga's ability to continue wielding power is due to his being a very clever, astute, wealthy man. He always knows exactly what he wants, and does not hesitate to utilize his personal character- istics and his wealth in obtaining his objectives.6.  Zuniga's present ambition for continued power has forced him to feign being a firm constitutionalist. That is, he is claiming loud and clear that commitments made between the government and political parties must not only be respected but must also be adhered to. Zuniga does not clain this because he really believes this to be a moral obligation, or because he is a fervent democrat. The fundamental reason is that he knows he is the recognized leader of the Nationalist Party, as well as having become influential in the Liberal Party. He believes these parties are the ones sustaining the present regime of President Ramon Ernesto Cruz in power. Therefore, he calculates that through these two parties he can protract the power he has today.7.  Today relations betwen General Oswaldo Lopez Arellano and Zuniga are not as cordial as they were previously. However, one must not be led to be- lieve that this situation is unrepairable because if Zuniga needed Lopez Arellano's help, or vice versa, the former pleasant r 'ationship would be hastily nursed back to life. It is just possible that if a coup d'etat led by General Oswaldo Lopez Arellano should take place, and be successful, Zuniga would make a great effort to settle any differences existing between them. This might not please some of the army officers who dislike Zuniga due to his character and the procedures used by him to obtain power.8.  Up to the present time the Armed Forces do not appear to be leaning towards the "left". They are naturally desirous of improving their way of life. The Air Force has recently organized a company whose entire net profits will go to the Air Force for the benefit of its members. General Osvaldo Lopez Arellano is investing in various industries and small private industries. He has very recently established a company called Empacadora de Carnes (meat packing firm) whose net profits will be for himself alone. The Armed Forces hold General Oswaldo Lopez Arellano in the highest esteem. This knowledge is based on his observations and personal contact with officers and enlisted men.- end -E 2 INFDET CL BY 007622C-O-N-F-I-D-E-N-T-I-I-LNO DISSEM ACROAD