14-00000 . PLANNED RESUME LIMITED EDITICNS |) SHIP. . _ ON TOMAS MORO STREET AFTER FIGHTING. BR Age nee ry ahePa PUM Ie e Be CRE ee Oe Feta F APP A. . a eo ro - os mm eee en eee as an, enamine ote Lett tthe 20 nt we rn nt ete sent inne nomen n= ees coven 18% Been ie BPO Bem mmenene ae OUTGOING MESSAGE — i — _— . om go 6OlCUCltCiti . _. 2 s e C R eT - SAla Prag Cae ° - ; WR RBAGR OCG DELLE eypose CONF: INFO; FILE . - . DISSEM BY: cnn O  mnen O no moss pea of 0 Ek ed 0] wens AND. CIVILIANS: THEY EXPECTEBD TO ELIMINATE LAST POCKETS RESISTANCE BY LY SEPTEMBER. ; , oo Loot . Be JUNTA CONTROLLED RADIO STATIONS AND ONE TV STATION . OPERATING. PUBLIC UTILITIES ARE FUNCTIONING NORMALLY NEUSPAPERS 3 SEPT BUT ARE SUSJECT TO CENSOR=- ye. JUNTA ANNOUNCED THAT PRESIDENT ALLENDE COMMITTED SUICIDE IN LA MONEDA AND TROOPS ENTERING THE BUILDING FOUND HIS BODY INA | DINING ROOM. S. JUNTA TV PROGRAM SHOVED LARGE QUANTITIES OF SOVIET MADE -AUTOMATIC WEAPONS COLLECTED aT LA NMONEDA AND AT ALLENDE RESIDENCE or cemannteanncg fb. JUNTA PRESIDED OVER BY GEN. AUGUSTO PINOCHET {ARMY}. AN INTELLIGENT. PROFESSTONAL OFFICER WITH NO KNOUN POLITICAL TIESS - ADMIRAL JOSE MERINO {NAVY# 5 WHS IS INCLBINED TOWARDS NATIONAL PARTY “CCONSTERVATIVE?S CEN GUSTAVO LEIGH {AIR FORCE}. A STRONG LEADER uno FORMER SUPPORTER, "RADICAL PANTY AND KNOWN TO DISLIKE CHRISTIAN | ‘DEMOCRATBSS AND GENBERAL CESAR RENDOZA, {CARABINERO CHIEF} uHo HAS OATEs a. ! ORIG: ; "reer: ExT: | ev» eee @ eS . aBrnawrec anita ¢ osetan . cuseiw cate” REPROOUCT.... GY OTHER THAS THE ISSUING OFFICE is PRL veo E- -2 IMPOET- > ¢ eheISSE SECRET lot. MELT doy GHEE Denham, GPU EB bad "eo 866 2 nent . eterna Se noe eNO” RNR) | eytentgterentsreee we
14-00000 Ce ee te A tre Se OER Hee OUTGOING MESSAGE Ja Ee i Den Seta SOR ON Binal CHIE RUSE OMT 5 Sa te me si a weet a aaa on ate Op woe . aoe . \ esae oP Parse or o 0 Go Oo oO @ oe 3 ame Ree RES ; & . . SECRET - oo oo | O88 GRADE OF6 RIN 60D BULL FE Oare.rre Came ene . SR dAGG BAPE REELS AMER CONF: . info; FILE a 4 - OISSEM OY: O nos O nomose .¢ , Ysy cog? per Q BORURW IG oon anemone ia] PPRae CLOSE TIES TO MILITARY AND APPARENTLY HELPED PLAN COUP. 7. JUNTA NAMED FOLLOWING CABINET 12 SEPT: ; v . | MINISTER OF THTERTOR - MA GEN OSCAR BONTILLA CARMYS. UHO SERVED AS PRESIDENT FREI'S SENIOR MILITARY AIDE FOR ' TWO YEARS. . MINISTER OF FGREIGN RELATIONS - REAR ADMIRAL ISMAEL HUERTA {WAVY}, HIGHLY RESPECTED IN NAVY AND ONE OF INTELLECTUAL LEADERS OF CoUP. | MINISTER OF ECONOMY ~ MAJ GEN ROLANDO GONZALEZ CARNY}s REPORTED TO BE A U-P. SUPPORTER AGOUT L973. MINISTER OF EDUCATION - JOSE NAVARRO TOBARy A CIVILIAN BIOLOGY AND-BOTANY PROFESSOR OF UNKNOUN POLITICS. MINISTER OF JUSTICE - GONZALO PRIETO GANDARA, CIVILIAN LAWYER. 7 i MINISTER OF DEFENSE - VICE ADM. PATRICIO CARVAJAL, FORMERLY CHIEF OF HATIONAL DEFENSE BSTAFF. REPORTED INVOLVED IN ANTI-GOVERNMENT ACTIVITIES AS EARLY AS 1472- MINISTER OF PUBLIC WORKS AND TRANSPORTATION - BRIG DATs ‘ QRIGs UNITs EXT: ERO trated tn, OFF OEE RY BPE WT ATH OPTED REPRODUCTION BY OTHER THAN THE ISSUING OFFICE IS PROHIBITED «= 2 IMPDET CL BY: OS7SSb RULERS GPPEER Si as tered area SECRET a + wmeren .
14-00000 pe asa aan eee Pari PEPE ENE WER RD PEE BEET FFE ee ane ae) | Ne enn nr ne mice mee cemace mane min marm eens om mm RT TTR OS — coe eee wae ee co ETE 8 ob ae cee cae OUTGOING MESSAGE tet Lil pi ii. SidmeaL CHRTER VIE OMEF an eetere ue eages ace Peed ' ore , ae eae tus onF 9 0 0 0 i} 0 bee are SECRET - 7 oot an . wR epad eae une rend 8 BAG. Fad GRUP ere 6 R666 HOPG SE IY. E PCEEER oo cone: nro: FiLe rn ve aye TP Gg Pek. ee oem GEN SERGIO FIGUEROA {AIR FORCE}. REPORTED IN EARLY L972 (TO BE AMONG ANTI-U.P. AIR FORCE COLONELS. " en i MINISTER OF AGRICULTURE - COL SERGIO CRESPO. (net. are FORCE} + AGRICULTURAL AND CIVIL ENGINEER. MINISTER OF LABOR ~ GEN MARTO MACKAY {CARABINEROS} » “ANTI-U-P OFFICER NAMED IN JULY AS COMMANDER ‘IH CONCEP- CION. MINISTER OF PUBLIC HEALTH - COL ALBERTO SPOERER {AIR FORCE}. FORMER CIVILIAN SURGEON DESCRIBED AS HARD WORKER. MINISTER OF MINING ~ GEN ARTURO YOVANE “{CARABINEROS} + WHO WAS SCHEDUL@ED TO BE RETIRED BY ALLENDE IN AUGUST + CLOSE TO MILITARY- MINISTER OF HOUSING - BRIG GEN ARTURO YIVERD. HARD- WORKING STAFF OFFICER WHOSE PERFORMANCE UNDER PRESSURE SOMEWHAT UEAKe SECRETARY GENERAL OF GOVERNMENT - COL PEDRO EWING “CARMY} DESCRIBED AS INTELLIGENT. PATRIOTIC. COUSERVATIVE: DATE: , ORIG? Units EXx¥s : e we oe oe Lad ; . - : e . ° ° cw : * eee auinde caren of nia9 . we! Bey 6 LB SPeweag gs COOOBMAT HA QC ERE cserenaron REPRODUCTION BY OTHER THAN THE ISSUING OFFICE 1S PREMIER + E 2° YO EMPDEY on eS ewe 7 ~ ereRre
14-00000 ee - OUTGOING | MESSAGE Ce . 3 i BIGMAL CG TSH eed OLE a ae ntti =n am een be 3a aod coe rd roe 198 RD paoe anes OnF Q 1] i] 0 a o COA Be ANE . & SECRE fF. A TERSE Amon Mosh ules APD . QRID-Ties acess « eee MEGG4OE Rar Bag et 8 Atte ORE CONF: ; inFO: “FILE . ; DISSEM BY: 0 PG Pane ° . : 0 Pres . UMSERSECRETARY. OF INTERIOR ~ LTH COL ENRIQUE MONTERO : {AIR FGRCE} FORMER, LEGAL OFFICER IN AIR FORCE. eo MESISTER OF LAMBS AND COLONIZATION - GEN DIEGO PARRA RETIPES CARABINERO OFFICER, ON WHOM LITTLE IS KNOWN. , MINISTER OF FIHANCE - REAR “ADM LORENZO ORTUZAR LITTLE NOUN OFFICER. , & JUNTA HAS BROKEN RELATIGONS WITH CUBA AND WILL PROBABLY goa BREAK WITH OTHER SOVIET BLOC STATES. IT WILL PROBABLY ENDEAVOR © STRENGTHEN TRADITIGNALLY FRIENDLY TIES WITH U-S. AND SEEK AID AND DEGT RELIEF FOR INTERIN. |. JUNTA WILL PROBADLY DECLARE COMMUNIST, SOCIALIST. AND SHALL LEFTIST PARTIES Suca AS MIR ILLEGAL AND DISSOLVE CUT LABOR CONFE DERA~ TION. THEY DO Nor PLAN WORK WITH POLITICAL PARTIES buat MAY CONSULT UITH THEM. THE CHEISTIAN DEMOCRATIC PARTY IS EXPECTED To EXPRESS SUPPORT FOR THE JUNTA AS IS THE OTHER MAJOR OPPOSITION POLITICAL GROUP, NATIONAL PARTY. STRIOKING TRUCKERS AND PROFESSIONAL GUILDS a HAVE EXPRESSED. SATISFACTION WITH COUP AND CALLED OFF STRIKE. - 10. FILE: 25-L24-S2. € 2. IMPDET-A | _)2 SEPTEMBER 1973 : : i DATE: . (S-1a4 "SA i on: CUHK b/ RRO 7710/1069 6 - “ me a Ext: : . . bs “Mutcemicalin® OOeCEs : soe F BEL GARinee OoPeeEs COOehms hs CHP cuasemcaron REPROGUCTION BY OTHER THAN THE ISSUING OFFICE IS PROHIBITED =f 2 IMPOET ao. ceroer . © GL BY gsassh |
14-00000 WILLEISG SUPPLY SPECIAL OUTGOING, MESSAGE mee Pon = | HOw AL CH MOTE UTE omer . ° = : cane 8 et hae D aag eae ane toe 978 - ., B2O . ~ onr ¢ OG 6 0 1] tiasereere SECRET ; O06 BG autmEMP, oe OR ATOR ate. FF eB | STAFF L9204 DIRECTOR 54uO2b2 i on WU MS mror rue ag) Wy LUG, S56 3, . ) astunnso PER \ OG weaee @ 1 TO2° FANGURG INFO SANTIAGOs BONN» FUONES PSYCH CASPECIAL ¥ m4 REF: RANGhaG 2u7S9 ¢IN 225631} ¥ : ra) kL. AT THIS POINT DO NOT CELTEVE OXHERALD ATTEMPT IMPROVE CHILES IMAGE | IN 6G GERMAN | MEDIA STANDS nucH CHANCE OF SUCCESS. PREFER LET BONIGRATION CAMPAIGN RUN ITS COURSE. BUGIS WE WOULD BE BRIEF DESIGNED TO INFLUENCE CAREFULLY SELECTED TIDIVEDUALS WHO ARE OPEN TO PERSUASION AND WHOSE VIEUS WOULD CARRY — REAL HEIGHT, BUT WE DO NOT FEEL BKHERALD SHOULD CNGAGE IN GENERAL BOTH PROPEGANDA SUPPORT OF CHILEAN REGINE SINCE LATTER APPROACH INEFFECTUAL AND NIGHT WELL BACKFIRE-¥ 2+ FILE: 25-L24-4b/3- E2 INPDET-d A L DATE: 44 APRIL 1974 /s~ sed 53 ORIG: | 15 Apert tate DC/UH/b * pS5b/91S5 AC/UHICA 2 —— ICHND DEGAS ond Oo OED herrea tbat ome OFF Popes 20 OO PE FH caneamrcariote REPRODUCTION BY OTHER THAN THE ISSUING OFFICE 1S PROHIBITED € 2 IMPOET SECRET CL BY: 9575S Se ee oe Ce eed en ome ow. aoe meg oe
. 32 a- /- . OTAl COP COPIES oY CABLE SEC OF9GR4 BOL PER oe penne — REPRODUCTION BY OTHER THAN ISSUING OFFICE IS PRONIGITES SECRET ‘ pERBON/UMIT MOTISIED _ARYANGE GOP. 3 vapgonmeg AL -— ACTION UNIT EVES ra bee amen a CTION # oa ws MMM: o- / a ——- 478 COC—COO—CTCOC~CS*CS«i AED. - _ ———"WH335831—O Oe rORIA713262 APR 78 HAMB 24759 meget AO EAL OCC AE OT $£C 8 € T 1712532 APR 74 STAFF CITE HAMBURG 24759 To: BIRECTOR INFO BONN, SANTIAGO, FUOMEN ps vee CASPECIAL 4s CHILI IMAGE AS REFLECTED IN WEST GERMAN MEDIA COMMEN@ TARIES MAS REACHED ALL=TIME LOW AND EVEN CONSERVATIVELY INCLINED OUTLETS SY AND LARGE» NO LONGER QOTHER TO TELL "THE OTHER SIDE." EASTER: BBDTO STATIONS MAINTAIN RELENTLESS DRUNF IRE OF ANTL*CHILEAN PROPAGAND ;A AND THEPE NO APPARENT DEARTH CF INFG TO SUSTAIN RATHER EFFECTIVE DERIGRATION CAMPAIGN. 2, [6 SPITE OF DISMAL AUSPICES TO TURN TIDE, (UNLESS JUNTA DECIDES TO SHOK SOME DECENT REGARD FOR OPINIONS OF MANKIND)» WE CAN STILE PROMOTE FAIRER UNDERSTANDING OF IMPERATIVES OF CNILEAN SITUATLG: TO WHICH JUNTA APPARENTLY FEELS IMFELLED TO RESPOND. TOWARD THAT END. REQUIRE SOME TYPE OF OBUECTIVE spPRAIS HOF RECENT DEVELOPMENTS AND OF PREDICTABLE TRENDS. serra, 3, FILE DEFER, €2 IMPDET. . Cc 4 oe ‘ee SECRET rh. od, ; . f . ‘
14-00000 ewe a oe . me, —- Pd a Ps CAOLE SEC ONSSEM Dace! pra TOTAL coms J f-— 7 <4 ~~ (ez 5 . S Bow peowae +n Re CYION BY OTHER THAN S ECR Ecy : PSE eraiea! Pica 18 PROMOITED AGENCY MESSAGE PERSONS UMIT HOTIIED. Let fe _-ARVANCE COPY ISSUEQ/$LOTTED ACTION UNIT | . RF. FILE . TOA:@4214gd APR 73 SaGo 24546 0 APR 730 >. §$ ECG RE T 9421182 APR 73 STAFF ClTE SANTIAGO 24516 702 PRIORITY DIRECTOR, (c. 418 ns): . a _ [pes [Bap - as REFS! &; SANTIAGO 244677 8, DBIRECTOR 3914223 i, IN VIEW OF THE POSSIBLE REPERCUSSIONS REF A INFO IF IT WERE SURFACED GR IF IT Cavz TO THE ATTENTION OF THE U.P, GOVERNMENT, STATION RECOMMENDS AGAINST FUOMEN EXPLOITATION oo atcnismmg, | | 2. FSLE! 15926052, €2 IMPDET RECORD COPY SECRET HEM TARA OL ORME SO MRE et EF: Mp4 -Sa O44 APR Y 5 Wm
CAGLE SEC DISGEM BY. REPRODUCTION BY OTE THAR 193U.NG OFFICE t8 FavRIBiTED / . a“ ° a? e Bee So nm ew, . ___fOtAL Comins & a Bel- Say By Sole) PERSOM/UNIT NOTIFIED —ADLANCE COPY AGTION wrait C. __ (WKS ACTION @ _. T 6275466 FaGe gt sore) | TURIL417172 JAN 74 SAGO- 27899 SECRET 161350¢ yan 74 9 TAFE Se a CITé SANTIAGO 27699 i TO! DIRECTOR, | le ann, "RY BAT FUUMEN 2 ~1h4° 5 REFr “DIRECTOR a99ao9 °° 1, WISH TO OFFER FOLLaWTNo~e G~eUGUESTED CHANGES [N REF | WHICH BASED ON LATEST INF¢ AVAILABLE LOCALLY. PARA 31 MesCENTRAL BANK DEVALUED THe EsCUDO FGk IMPGRTIS/EXPORTS BY SLIGHILY OVER 120 PERCENT Iw an EFFURT To CURB IM2Q9RT DEMAND, ENCGUAASE EXPORTS AND EASE PRESSURES..." W._ .OTMER PRICE RISES BROUGHT INFLATION FOR THE Yoam ") 526 PERCENT..." ¢FoR DIRECTOR: WHILE FREVIQUS ESTIMATES SY HUT EMGASSY AND IMF IN NOVEMBER FLACED INFLATION FOR THE Kena at PRUBABLY. BSTNEEN 75d aND agg PERCCHT, ThE END@GFSTHE~YEAN FiuURE OF THE NATIONAL STATISTICAL “ke INSTITUTE WAS 306.2 SEs SaNTIAGS EMGASSY TELEGRAM @173 OF 141 JANUARY.) Oo €, PARA 4 LAST SENTENCE SHUULD READ "THE MasSIy¥E 3,5 BILLION GOLLAR FuRelow vest..." Pasa 7: "AONTALY SCPPER PRUDUCTION HAS ALREADY INCASASEL MORE TRAN 5@ PERCENT QVER | THE AVERAGE DUNING THe Fla? NINE MONIRS OF 1973 ana pRadUC | ; ao ECwAeT IS -/2%-57 | RECORD COPY IS -4 #52
TOTAL COPIER PER vines amon ee RUN py s é—€Cref PEMBUORSUNET NOTISIEO ne nee ate a ee ee re rere nema CAULE BEC CINGEM BY WEP ROU POs BY GYR THA (OBVUING GFPICE (8 FROHIGITED ww AUVANCE COPY IS. VERZSLOLYEQ OB en ACTION UMIT RF. FILE . vA. ACTION 8 —_— Th 397546 Baie gene ~ IN 130686. TORELGLIATE GAN 74 SAGO 27899.. lui PROGADLY REACH A REVORY OF AT LEAST 853.300 TONS IN 1974565" 3, WO FILE, e2 [4PDET . oe e ~~ e e eo we i ° « « ‘@ eo @® ad i o ewe ~ - se # ~ ‘ . e 4 . e a ow . — : : w wet gp we Y i _~ ~ oo - “
14-00000 ee cn etlnal spon Remnants Ain Soci A mt te me se et Sa cd 72 oo * @ as ee ee eg me ae gen age gg ae Pang uP enoct + rae a Natt pene aoe ee Bae Uw ce eee ‘ OUTGOING MESSAGE SIGNAL CEMPE GE UBE GAP aes, tor ace we tre MAD oF oO ao 0 a a 0 | 1 SECRET. oe STAFF a9. , DIRECTOR YYUb9 conr.C. lu. HS WWEO:. FIL Kons ck a : G ef: AY g a 0 GISZEM OY: ss . ahs 5, . fs sirvento PER © OER # . 0 inure SANTIAGO. TO: BONN, _ RYBAT FUOMEN i. FOLLOWING “Suni RY_OF POLITICAL AND ECONOTITC SITUATION IN CHILE AT BEGINNING OF 3974 NAY BE USEFUL FOR ORAL BRIEFINGS OF LOCAL GOVERNMENT AND OTHER HIGH LEVEL CONTACTS WHO INTERESTED IW CHER Ere STIPULATION NO FURTHER EXPLOITATION. oe tae a = 2. THE OUTLOOK FOR CHILE IS CAUTIOUSLY oPTINISTIC. roe ile: = NELITARY GOVERNMENT HAS AVOIDED MAJOR INTERNAL CONFLICTS "AN feos J MOVED AGGRESSIVELY To REORGANIZE GOVERNMENT AGE SiCTES nor sam pee EFFICIENTLY, TO CREATE AN APOLEZTICAL CIVIL SERVICES AND TO CORRECT THE EXCESSES OF NEARLY THREE YEARS OF DECAPITALIZATION UNDER STATE SOCIALISM. ITS ECONOMIC PROGRAMS. ALTHOUGH AUSTEREs ARE SOUND AND - OFFER A FIRM FOUNDATION FOR RECOVERY AND GRO ITH OF THE CHILEAN ECONO ony. THE STRICT SECURITY NEASURES ADOPTED BY THE JUNTA HAVE BEEN SUCCESSFUL IN PREVENTING ANY LARGE-SCALE, VIOLENCE OR TERRORISH AND ARE LIKELY TO BE CONTINUED FOR THE FORESEEASLE FUTURE. 3. THE JUNTA MOVED GUICKLY AFTER THE Cou? OF 32 SEPTEMBER TO RENOVE PRICE CONTROLS ON ALL BUT 30 BASIC Couno DITIES: UHILE THE BATE: ORIG: . . i | . . UNIT: : . : . . EXT: Co il Jen 7 4 . RECORD COPY : LS 7/2 ¥-5R GLE A tie orreon SEP MO AT ed FF OC ARH - sana unc atoa cormes chee ec ateom REPRODUCTION BY OTHE @ THAN THE ISSUINS OFFICE tS PROUTITEO € 2 PAPOET ceroeec Ff ev ow SGISokh
14-00000 ° and co at, P OUTGOING MESSAGE TT yo = Sirens Ce MIE UOE OLE fud tee Bao one oo oOo o8 G@ a <a Pee td a] SECRET ot apaud manure waged & Te Pale tema GAO UE eere mecnnce mvenence nuweee ae , DIRECTOR i) . DISSEM DY CONF: INFO: FILE . . 0 a em Dv . , : , 8] mata 13 PER 499967 . O wees @ CENTRAL BANK DEVALUED THE ESCUDO BY SOME bO% IN AN EFFORT TO CURB . IMPORT DENAND AND EASE PRESSURES ON. THE COUNTRY'S MEAGER FOREIGN - EXCHANGE RESERVES. AS A RESULT» CHILE'S COST OF LIVING JUMPED 88% IN OCTOBER, AND OTHER PRICE RISES PUSHED THFLATION TO SOME 770% FOR THE YEAR- : : ue THE JUNTA HAS NOW AGREED TO FOLLOY THE STABILIZATION PROGRAM PROPOSED.BY AN IMF TEAM WICH VISITED CHILE IN LATE saa LLS FOR TIGHTER FEDERAL SPENDING AND FOR LINITING THIS PROGRAN CA THIS IMF PROGRAM IS FEASIBLE BUT MAY . INFLATION TO 200% °IN 2974. BE SOMEWHAT OVER-OPTINISTICs ESPECIALLY SINCE THE WORLD-UIDE ENERGY CRISIS VILL SOON FORCE CHILE TC RAISE FUEL PRICES, THUS EXACCER- BATING THE PROGLEN OF CONTROLLING INFLATION. ADHERENCE TO THE INF HOWEVER: IMPROVEL CHILE'S CCREDIT RATING. AS HAS THE ITED STATES ON CHILE'S “PROPOSAL HAS. SIGNING OF A BILATERAL AGREEMENT WITH THE CHILE IS THUS IN A RELATIVELY GOOD POSITION FOR THE NASSIVE 44 LI71L- L172 DEBT. THE OPENING OF THE PARIS CLUB TALKS IN FEBRUARY. BILLION DOLLAR FOREIGH DEBT» HOWEVER, WILL CAUSE CHILE BALANCE OF BALANCE-OF-PAYMENTS PROBLEMS FOR SONE TINE. . . DATE: ORIG: UNIT; «EXT: evw @ e @ so w ~ ‘* ] e wv ow = . Bt, Asses OFFHCEA COOMREE WG OFF TES , wwe *ayimtn eR ME ber Tee” : “ e ° ~~ 4 ‘+ Sheek wed Abetn . REPROOUCTION @..-THER THAN THE ISSUING OFFICE 67 PAO UDI = gfe ~0°-F ORT v7. cl gy; 657556 SECRET
14-00000 od . . oo a OB OR ee ee UO eo eh eee ee ee ee en eae AA EAE A oe 4 me Ny ew aetna me ea aE # me oo . 2 ry oo. e @ @ #8 «@ OUTGOING 1.cSSAGE feces ns poe - eee fh « SOrwAL CEMIFR USE OME ° ad — coe ee be om ee were hi eens 6 ma of go og oO oO o 0 . 3 S ECRET ; ; ‘ Pre eae _ CATE. F168 GROUP Cate MEV OUs APR REO, 8 SEY STAFF DIRECTOR . > : oo. O] woee OISSEM BY: . CONF: INFO: FILE 0 wp mee QO anento PER IY 67 Dems ff 7. COPPER PRODUCTION HAS ALREADY IICREASED MORE THAN SO% OVER. LAST YEAR'S LEVEL AND. PRODUCTION WILL PROBAGLY REACH A RECORD 750,000 TONS IN LIZ4 DESPITE SPORADIC SHORTAGES OF SPARE PARTS AND SERVICEABLE VEHICLES. FARM OUTPUT, HOVEVER. IS NOT EXPECTED TO RECOVER FULLY UNTIL THE 1974/78 HARVEST SO THAT AGRICULTURAL - IMNPORTS.+ PARTICULARLY GRAIN: WELL CONTINUE TO BE A DRAIN ON CHILE'S - FOREIGN RESERVES- &. THE JUNTA HAS DEMONSTRATED GOOD FAITH IN THE TREATNENT OF FOREIGN EQUITY AND HAS LINED UP SUFFICIENT FOREIGN CREDITS TO ENABLE IT TO PURCHASE CAPITAL GOODS AND FINANCE THE CURRENT. PAY= NENTS GAP.’ THE GOVERNMENT HAS ALSO UNDERTAKEN TO SETTLE ouT-— STANDING COMPENSATION CLAIMS ENANATING FROM ALLENDE NATIONALTIZA- TIONS, STATING THAT IT WILL EIVHER RETURN INTERVENED FIRNS TO THE PRIVATE SECTOR» OR AS IN THE CASE OF LARGE COPPER NINES. ADEQUATELY COMPENSATE PREVIOUS OUNERS. FORMER PIIVATE BANKS WILL ALSO BE RETURNED TO THEIR FORMER OUNERS. BUT PROBAGLY UITH SONE FORMULA INVOLVING WORKER PARTICIPATICH IN BAK NANAGEMENT- THERE ARE ALSO STRONG INDICATIONS OF RENEUVED INVESTOR CONFIDENCE, AND PRIVATE DATE: ORIG: GENET s Exv: LOSS ALG HF CEB Rene Pants MIE AMWG OPH EB REPRODUCTION OY OTHER THAN THE wsSuING OFFICE §S PROWDINCO —& 2 PAPNET ci. BY: US7S5b Mee eahors GFF Ae Weems.) SECRET
14-00000 Meee nn boo hime ace tice eens a dO OUR ee a NE Ee YEO OA DE a a ee LE Het I Re em nee ate al OF come w Reata mee  e ae ee ee ed OUTGOING MESSAGE — — Reena wie ' ‘ « 7 aa Sarak COMES VSS Cer e onr oO G@ 80 oo a 2 4 SECRET . 2 BOR AMT ORL eID BOE: Fird GBkue . . ee ME RCAGE BEF & aan, ¢ SPEED STAFF, ; - DIRECTOR : 7 O woes OISSEt BYs | CONF: IFO: FILE _ : OD no wore” , . a oseuenre PER GG o . FOREIGN INVESTMENT IN CHILE 1S CxPECTED TO GROU SUBSTANTIALLY SURING 11746 | q. INTERNALLYs THE ELININATION OF PRICE CONTROLS AND ADJUST- | MENT OF EXCHANGE RATE HAS PRACTICALLY. ELIMINATED THE ONCE FLOURISH~ ING OLACK MARKETS IN COMMODITIES AND FORELGH EXCHANGE. HOWEVER: THE EURDEN OF AUSTERITY Of CHILEAN CONSUMERS HAZ 2EEN HEAVY. DESPITE HEALTHY INCREASES .IN WAGES AND FENEVED CONFIDENCE BY BUSINESSHENs UORKING CLASS CONSUMERS FIND IY LIFFICULT 70 AFFORD THE BAREST NECESSITIES, AND WORKING CLASS LABOR IS TAKING A UAIT AND SEE | ATTITUDE.» THERE ISv HOWEVER. 9 ORGANIZED FESISTANCE TO THE JUNTA “OR ITS PROGRAMS. SOME POLITIC/L FACTIONS, PARTICULARLY THE — 2 CHRISTIAN DEMOCRATIC PARTY {PDC} ARE GRUMELING>s BUT THIS DISSATIS- FACTION IS LARGELY DUE TO GOVERLIENT EFFORTS TO SET UP NEU NON~ POLITICAL-PARTY MECHANISMS FOR ELACHING THE PUBLIC. | | LO. GOVERNMENT "RECCSSING” OF CONGRESS AND ALL POLITICAL’ PARTIES HAS CREATED A POLITICAL VACUUM IN CHILE. THE GOVERINENTs UNTCH HOLDS THE POLITICAL PARTIES LAURGELY RESPONSIOLE FOR CHILE'S CURRENT PLIGHT. IS TRYIUG TO FILL THIS VOID EY AN INTENSE USE OF! DATEs 2 OnmG; Greats EXT; é ae - e se - w . - , . @ oT + « ” Roti atey orcas CGM Le MEE ry CFS Og aS .  ngint RO patewe 08 Bit . teassewanion REPRODUCTION GE UTHER THAS THE ISSUING OFTICE 1, PAQUET “SECRET CL BY: G5755b
14-00000 wf e Mae BA iene on ew meee MRA ty sea ON a A a ~ een ee Se Gee” TT 8 ee” ee Pe ans A ne we Bede a Ge OUTGOING  iSSAGE Toe eT ne bh ee fe pe . MOAR CENPE USE OME . . 7 ay ean a EE 2 ee : aay cue ace 10 we wee Peet Pona® “"——“OnF o oOo a 0 a s SECRET BE BUHG Ho APEK IS HOE AME Bare Mee saguP ewe” 8 bband OFF PAPEL B munose STAFF DIRECTOR ; QO more DISSEM BY: CONF: info: FILE DO x0 moss . . uo : CG attunwve PER | - | VIILL9 a ama CIVILIAN ADVISERS TO ASSIST THE GOVERNMENT MINISTRIES- THIS PHENOMENON IS NOST APPARENT IN THE AREAS OF ECONOMIC POLICY AMD IN SUCH TECHNICAL FIELDS AS PUBLIC HEALTH AND HOUSING. THE IMPORTAHCE oF THE GROUP OF ECONONIC ADVISERS HEADED oY RAUL SAEZ: FOR EXAMPLE TS WEtt KNOUN. THE MINISTRY OF HEALTH HAS All ADVISORY BOARD NOMINATED BY THE MEDICAL ASSOCIATION. WHILE THE NINISTRY OF HOUSING* S BOARD Is LARGELY CONTROLLED BY THE ORGANIZATION REPRESENT- ING PRIVATE ‘CONSTRUCTION FIRNS. SIMILARLY» ALMOST EVERY MINISTRY. AND NANY AUTONOMOUS AGENCIES HAVE PERMANENT CIVILIAN ADVISORY BOARDS COMPOSED OF REPRESENTATIVES OF GROUPS WHOSE WELFARE IS | AFFECTED BY THE AGENCY'S ACTIVITIES. “Ube IN ADDITION TO THESE CIVILIAN ADVISORY BOARDS. THERE ARE A LARGE NUMBER OF "STUDY CONMISSTONS® THROUGH WHICH CIVIL TANS CAN EXERT THEIR INFLUENCE. BEST KNOUN OF THESE IS THE GROUP oF TiTER- NATIONAL LAWYERS WHICH IS DRAFTING A NEW CONSTITUTION, GUT THERE ARE OTHER GROUPS WORKING ON A NEW MINING cope STUDYING THE EDUCA-~ TIOUAL SEYSTEN, COLLECTING INFORNATION ON uy: EXUHPLOYMENT 4 WRITING A STATUTE FOR WORKER PARTICIPATION IN QUSINESS ENTERPRISES+s AND ogre ORIG: UNITs EXT: CHIMOMmarns OF FLAS QuTwe IC Ate BOs w REPRODUCTION BY OTHER THAN THE ISSUING OFFICE IS PROMIBITCO = EQ LIPDET , CL BY: C 3#526 SPA ESBs OPE SR TLAR BE ave SECRET
14-00000 Fe te BA eee poem vengeance ee oe eer am en semen me = FSO | QUTGOING MESSAGE (oe ny yo f Diana CENTER UST OPAL * ase con ae 86 8 aod o paar our oo 9 Oo @ Oo 2 Sg ge eheo es BI ‘SECRET ed 7h OE aidaitiel WOE ATOR RATA free eRe . cre MESSAGE mao gE POLE aueped STAFF DIRECTOR a j ; 2 0) woes OISSEM BY: \ CONB: INFO: - FILE no mors : . . ; O xaruanto PER Ce PELVING INTO A DOZEN OTHER TOPICS: Lee ALTHOUGH SOME CHRISTIAN DEMOCRATS. HOLD INFLUENTIAL GOVERN MENT POSITIONS, NOST CIVILIAN ADVISERS ARE ELTHER CONSERVATIVE OR APOLITICAL. LACK OF MORE UIDESPREAD PARTICIPATION BY CHRISTIAN SENOCRATS MAY CREATE PROGLENS FOR THE GOVERNMENT IN THE FUTURE. “ESPECIALLY SINCE ORGANIZATIONS REPRESENTING WORKERS» CAMPESINOS | AND POBLADORES {WHICH FORMERLY SUPPORTED EITHER THE CHRISTIAN PEMOCRATIC PARTY {PDCF OR THE ALLENDE GOVERNMENT? ARE 50 FAR INADZQUATELY REPRESENTED ON ADVISORY COUNCILS - THE GOVERNMENT HAS ESTABLISHED UNITS ADDRESSED TO YOUTH: OMEN. GUILDS AND NEITGHBOR- . HOOD CIVIC GROUPS IN THE SECRETARIAT GENERAL OF GOVERNNENT + AND HOPES THAT THESE WILL SERVE AS VEHICLES FOR GOVERNNENT-TO-PEOPLE COMMUNICATION. 13. «THE JUNTA LEADERS VIEW WITH DISTRUST ALL PDC EFFORTS TO WIN NEU POLITICAL ADHERENTS FRON THE WORKING CLASSES UNICH FORNERLY SUPPORTED ALLENDE'S UP COALITION AND REPORTEDLY GELIEVE THAT THE PDC IS NOT RESPECTING THE POLITICAL RECESS- THE JUNTA IS PARTICULARLY CONCERNED BY THE POSSIBILITY THAT THE PDC*S LEFT WING DATE: ORIG: Units Exe: www s ° oe « s ad @ @ ~ + “ “ ow Be - . . eseuww a - HELE ATO CFF CED COnarmarena OFF <nes “ . Bp ate, OFF CEB if 4 . e w 7 A “ot tT Dre CTION BY OTHTR THAN THE t5SUiNG orrice °g ORCH: witp "ep pHy ; REPROOU G&A miport ; “SECRET CL BY: NG7SSb
OUTGOING i. -SSAGE fe signa cents SUSE ONLY ‘ aug co ace TOS ree ee our a o)80OUdG a 0 °O- SECRET © ex ee 8 OCE yt ed wemcatoe . . BAe. rss Breuer , STRAFF : CONF: ; INFO: FILE ; é] BILL AID THE FORMER UP PA SUPPORT + Ly. ONE PROGLEN a t PERU MAY ATTACK CHILE THA ANNIVERSARY OF THE WAR BETUEEN CHILE SONE OF THE TERRIT THE SOVIET SALE OF ING TO CREATE ANOTHER U LATIN AMERICA: . ; ug. THE JUNTA IS ALSO CONCERNED INTERNAL DISCONTENT AND TO MOUTI THE JUNTA EXPECTS THAT THE FORNER UP WILL SET UP A UNIFIED AND WILL TRY TWO PCLITICAL DISCONTENTs OPPOSING THE JUNTA GOVERNHENT ARE BEING ORGANIZED IN EUROPE- ib- DESPITE THE FROSLENS NOTED BATE: . ORIG: UNIT: EXT: Connmnatieg Cor EAS wis ac ven 09 FER REPRODUCTION gy OThon Pre ad cr eRret RTIES IN RETUR F NAUOR CONCERN TO TH some TINE . ory LOST IN THAT WAR- ans TO PERU AND FEAR THAT TH NSTASLETNIDDLE EAST T AN INTERNAL RK FRONT FOR CAUSING CIVILTA - 4 ARGENTINA AND 8 IA THAN THE ISSUING OFFICE iS Pr Byars} ee a p 3 al on eee betes fe) * * = A = “(2 ees aan} TI : eaaa oF ranss wagsace RATT MRMEE pene eee wend 8 DIRECTOR ae DISSEM BY: eG GE E oaoao aeruanra PER WICT amen ft N FOR FUTURE ELECTORAL g JUNTA IS THE POSSIBILITY PRIOR TO LA?A THE .GOTH AND PERU, IN ORDER TO REGAIN THE CHILEANS ARE YORRIED BY E USSR HAY BE TRY- TYPE” OF CLIMATE IN BY COMMUNIST EFFORTS TO CREATE ESISTANCE HOVENENT - PARTIES. LED BY THE CONMUNISTS + N DESTURGANCES AND Q ANIPULATE THE ppc INTO FROHTS FOR CHILEAU RESISTANCE EVERAL ARE BEING SET UP TH above, THE JUNTA GoveriNenT IS [3S ~12F -5* TCUMIAN ED Cc 2 IMPDET cL BY: 057556 { & ke Es a FE : E s 3 § t 5 ‘ ] : : ! ‘
14-00000 Pts _pbOd/ Lob Ne OUTGOING MESSAGE SMALL CHEMTEA USE ONCE onF go o§= G6 Q4 ca a0 SECRET STAFF . | CONF: , . INFO: FILE IN FIRM CONTROL_IN CHILE AND HAS MAD REORGANIZING THE GOVERNMENT AND IN € “ITS PROGRAMS. PROSPECTS FOR ECONONI THE BEST UHICH COULD REASONABLY BE E ENTIRE ECONOMY WAS A SHAMBLES IN SEP (L?- FILE? 2S-b2u-S2. E@. INP BATE: At GRIG: URIT: RY 3 4 . UNZEICO - [eae : X MUKA - Fame wed ace c Ct rec Oats Y rere te ” €6GRee at atapey 4 SECRET ; é REPROOSUCTION 8 ~oTHEN THAN THE ISSUING OFFICE S-F eC india € OE DRAGS REFEREE MOO " e198 DIRECTOR O mose = OISSEM BY: QO ray woe PER wEtuNe To OS > GTI gg €& IMPRESSIVE PROGRESS IN NULISTING PUCLIC SUPPORT FOR C RECOVERY AND DEVELOPNENT ARE XPECTED FROM A COUNTRY. WHOSE TENBER 19730" DETed {IN DRAFT} ra - Aran A Fem Cee ew ~ - 2° iieDtT CS7556 ct BY:
14-00000 STAFF : ; cone: VHS INFO: FILE ve Ona cCantanuaE ye a ee a08 coo ace OMF Cf QO 0 O @..a0 . Chahanne anove SECRET ME 89598 HAMUNG MHCATOR OE OTAHE BE FE OE 15¢ 6 MRED DIRECTOR. 487650 EUNR << 4 mone DISSEM BY: — a Oo mene a ere eT [) ee TO: HAMBURG INFO BONN, SANTIAGO.\ | FUONEN CASPECIAL CAFECET REF? HAMBURG 23861 IIN O5L923/ fee huw/ a& | b ~— L. FOLLOWING ANALYSIS OF CHILE AN ECONOMIC SITUATION AHD OF RIS RE REE IRR ENS STTUATION AND OF RISK FACTORS INVOLVED IN MAKING INVESTMENTS IN CHILE PREPARED FOR PASSAGE (GEES TNENTS IN CHILE To HERMES BANK PER REF PARA 1 REQUEST. A- THE RULING JUNTA IN CHILE I3 MOVING AGGRESSIVELY To REBUILD THE ECONOMY BY ADOPTING A HARSH AUSTERITY PROGRAM AND IN~ STITUTING POLICIES DESIGNED To RETURN CHILE TO A MARKET ECONOHY. 2B. SANTIAGO MOVED QUICKLY AFTER THE COUP TO REMOVE PRICE. CONTROLS ON ALL BUT 30 BASIC ConnopITies, WHILE THE CENTRAL BANK EFFECTIVELY DEVALUED THE ESCUDO BY SOME 60% IN.AN EFFORT TO CuRB IMPORT DEMAND AND EASE PRESSURES ON SANTIAGO'S MEAGER FOREIGN Ex~ CHANGE RESERVAES. AS A RESULT, CHILE’S COS? OF LIVING JUMPED 48% IN OCTOBER. BRINGING INFLATION TO NEARLY 4S0% FOR THE FIRST TEN HONTHS OF THE YEAR. ANTICIPATED PRICE RISES DURING THE REST OF 1973 IS Ex- PECTED TO PUSH INFLATION TO SOME 750% FOR THE YEAR. C. THE ELIMINATION OF PRICE CONTROLS AND ADJUSTMENT OF GATE: UNIT: . ON VEC 44 COGSiema ees Over gay ASME NTL AT ROR GPeEe Se REPRODUCTION BY OTHER THAN THE ISSUING OFFICE 1S PROHIBITED —€2 IMPDET cL BY: O57S56 REA bce Ooo AR CAA REPEL A Peay S‘ECRET SR ee ee a Ag he eel ip nes me nos A omen Sie cae + te ene me ae we
14-00000 EXCHANGE RATES HAS PRACTICALLY. ELIMINATED THE ONCE FLOURISHING BLACK OUIGUING Mb>>AvE i = = i: Bidens CONTE a URE OME "aus soo ee os we raee Pawe® OnF OQ 0 0 0 a. a ChABHS OC A CODE SECRET 28 F80G8 Martinred MoMA TOR Gore. Haag & meee . ete 9 ORAS SONNE eee URETD ae co Q  moee o1SSau BY: CONF: 7 INFO: FILE a v4 Lea CC. D womose a fj 3 ) O corer PER G wenes & H MARKETS IN COMMODITIES AND FOREIGN EXCHANGE. WHILE EXCHANGE RATES CHANGED AND PRICES ROSE. THE GROUTH IN THE MONEY SUPPLY HAS BEEN SHARPLY CURTAILED, CAUSING A RELATIVE SCARCITY OF. LOCAL CURRENCY AND A LIQUIDITY CRUNCH FOR BUSINESSHEN. “De OTHE BURDEN ON CONSUMERS HAS BEEN HEAVY. DESPITE A HEALTHY INCREASE IN THE MINIMUM UAGE, WORKING CLASS CONSUMERS ARE FINDING If INCREASINGLY DIFFICULT TO AFFORD THE BAREST NECESSITIES. © AUSTERITY HAS BEEN EXACERBATED IN MANY CASES BY DISMISSALS OF RELATIVELY UNPRODUCTIVE AND POLITICALLY SUSPECT EMPLOYEES HIRED UNDER THE ALLENDE REGINE- AN UNEMPLOYMENT COMPENSATION PROGRAM HAS BEEN ANNOUNCED AND AN EXTENSIVE PUBLIC WORKS PROGRAM IS UNDER CON~ SIDERATION. E. THE JUNTA IS ATTEMPTING TO ENLIST PUBLIC SUPPORT FOR THE AUSTERITY PROGRAM AND BUSINESS IS SHOWING RENEWED CONFIDENCE. CONSUMERS AND LABOR HOWEVER» ARE TAKING A WAIT-AND-SEE ATTITUDE. NO ORGANIZED RESISTANCE TO THE JUNTA .OR ITS PROGRAMS HAS MATERIALIZED» EVEN THOUGH SOME POLITICAL FACTICAS ARE GRUMBLING AND PREDICTING t OATE: ORIG: UNIT: exve . . @ ove : - “ e . 2 CODEN Pres oe ORD, ja cens @ QUTed ate atid OFC EB _ BY orne® qmas The 9su'NG OFFICE IS °RE «6D 6G 2 IMPDET SO CL BY: 087856 SEBAGO SPCR SIE CRET
14-00000 “REACH A RECORD 750,000 TONS NEXT YEAR DESPITE CONTINUING . Jt. She 844 , <. . ete “= “4 oe Styne, Cemiga we AP a roa [Phebe oF Pages e Py = tra cone” ® ® a . ae a8 ace OnF oO 0 0 Q og i nat a ma 3 SECRET . sesesee RANGE ee seed ar . Gate-Crete eee - ene WOES ROG AE OR OF ON, 8 ERE sone a pissem BY: aarvenvea §=6PER FAILURE FOR THE JUNTA. F. CHILE STILL FACES LARGE BALANCE-oF- PAYMENTS DEFICITS 5. eaoo wonss ot IN BOTH 1973 AND L974 EVEN IF DEBT REPAYMENTS ARE RESCHEDULED IN BOTH YEARS. uITH A MASSIVE ¢y BILLION FOREIGN DEBT HANGING OVER SANTIAGO'S HEAD, IT uTLL AT LEAST BE SEVERAL YEARS BEFORE CHILE'S BALANCE-OF- PAYMENTS: POSITION IMPROVES SIGNIFICANTLY. ~ G- HOWEVER, COPPER PRODUCTION HAS ALREADY INCREASED MORE ~ THAN 50% ABOVE LAST YEAR'S LEVEL AS A RESULT OF A 9% LENGTHENING OF PRODUCTION WILL PROBABLY SHORTAGES OF THE WORK WEEK AND IMPROVED MINE MANAGENENT. . SPARE PARTS AND SERVICEABLE VEHICLES. H. AGRICULTURAL THPORTS CONTINUE TO GE THE LARGEST DRAIN ON FOREIGN EXCHANGE AND THE RECOVERY OF. DOMESTIC PRODUCTION Is A PRIORITY OBJECTIVE OF THE JUNTA. FARM OUTPUT, HOWEVER, IS NoT EX=- PECTED TO FULLY RECOVER UNTIL THE 1974/75 HARVEST SINCE MOST CROPS ALREADY ARE PLANTED AND ARE WELL INTO THEIR GROWING SEASONS. THUS, CHILE WILL CONTINUE To IMPORT GRAIN IN LARGE QUANTITIES DURING 1974. Z. ° ALTHOUGH THE PROBLENS OF ADEQUATE SHORT RUN SUPPLIES DATE: ; ONG: UNIT: e COSMataT wee Qe eae A erh SCAM OPP Re REPRODUCTION BY OTHER THAN THE ISSUING OFFICE-15 PROHIBITED — 2 iMPDET CL BY: os7ssy, REA SOS OOCED CLAS SPRL ATA SECRET Snape Cem me Cree
a MOnae cCenres use One , : PAGS oF PaRae aes coe ae toe « ong piay OMF 0 rf] 4] Nh} a : 4 SECRET , BE OESS6 masety, 208 mea TOD Galette Gane ‘ ere BTS8505 EPs Rem § HU MEGA mone OISSEM BY; Cone: (NFO: FIL@ - 4 0 mas ‘ N65 C. Q aarenea PER , . - ia] Se PRED # , OF RAW MATERIALS AND SPARE PARTS hus BE SOLVED To BoosT PRODUCTION LONG RUN GROUTH WILL DEPEND HEAVILY ON CHILE'S ABILITY TO ATTRACTION: OF SUBSTANTIAL NEW- QUICKLY. ATTRACT ADEQUATE FOREIGN INVESTNENT s ABILITY To DEMONSTRATE GOOD INVESTMENT WILL DEPEND ON THE JUNTA WELL AS FAITH IN THE TREATMENT OF FOREIGN EQUITY AS CONFIDENCE IN CHILE'S PROSPECTS FOR STABLE RECOVERY AND GROWTH. A CRITICAL FIRST STEP IS TIMELY SETTLEMENT OF OUTSTANDING COMPENSBATION _ CLATAS EMANATING FROM THE ALLENDE NATIONALIZATIONS. THE JUNTA HAS “STATED THAT IT WILL ELTHER RETURN INTERVENED FIRMS TO THE PRIVATE AS IN THE CASE OF THE LARGE COPPER MINES. ADEQUATELY - SOME 90 FIRMS ARE ALREADY IN THE a SECTOR - “ORs. COMPENSATE THE PREVIOUS OWNERS. PROCESS OF. REVERSION. Je THUS FAR THE JUNTA HAS SUCCEEDED IN LINING UP sUF- FICIENT FOREIGN CREDITS TO ENABLE IT TO PURCHASE ESSENTIAL CAPITAL GOODS AND FINANCE THE CURRENT PAYMENTS GAP.- IN DU TTHONs THERE ARE STRONG INDICATIONS OF RENEWED INVESTOR CONFICENGE. AND PRIVATE FOR- EIGN INVESTMENT IN CHILE Is EXPECTED TO GRow DRAMATICALLY DURING THE NEXT le MONTHS. DATE: ORIG: Uae: EXT: dames omega AUT BUNCAP OER OFT EE aneincarion REPRODUCTION BY OTHER TRAN THE ISSUING OFFINE 8 PaCwarke E 2 iAPDET SECRET se wot _ Gb BY: gs7gsy ” . COCkDMA TING OF Fre gaR ~ ~ oe “ tee ee ~ ’ ww - +e Nee “ t€ eae ATHEIR ABILITY TO INSTILL TRE -
14-00000 -. , OUTGOING MESSAGE: OonF oO 0 0 0 o0.06hCté«@ ; . 5 Sener namin so ealedilianeatad ene ~ wesasae sereneuce myneee Me IMFO: ‘ous _. oO ‘moss —«DISSEM BYs om wg AS ae | a re oe kK THE ECONOMIC OUTLOOK FOR CHIBLE IS CAUTIOUSLY OPTI-. NISTIC AS THE JUNTA TAKES STEPS TO CORRECT THE EXCESSES OF NEARLY THREE YEARS OF DECAPITALIZATION UNDER STATE SOCIALISM. THE PROGRAMS» THOUGH AUSTERE. ARE ECONOMICALLY SOUND AND OFFER A FIRM FOUNDATION FOR RECOVERY AND GROWTH OF THE CHILEAN ECONOMY. THE MAJOR POLICY CONFLICTS WITHIN THE GOVERNMENT APPEAR TO BE OVER THE DEGREE AND TIMING OF SPECIFIC HEASURES RATHER THAN PROBLEMS OF BASIC POLICY ORIENTATION. . L. THE EMERGING DOMINANCE OF RAUL SAEZ AS SENLOR ECONOMIC , ADVISOR IS PROBABLY FOR THE GEST SINCE THE JUNTA'S. AUSTERITY PROGRAM MUST BE TEMPERED IF POLITICAL-AS WELL AS ECONOMIC RECOVERY AND STABILITY IS TO BE ACHIEVED. MEANUHILE. CHILE IS PREPARING TO SETTLE OUTSTANDING COMPENSATION ISSUES AND COMPLETE GILATERAL NE~ GOTIATIONS ON 1971/72 DEBT SERVICE IN ACCORD WITH THE L472 PARIS CLUB AGREEMENTS. TIMELY RESOLUTION OF THESE ISSUES WILL GO FAR IN IMPROVING INVESTOR AND CREDITOR CONFI@DENCE IN CHILE. 2 2. FOLLOWING QUESTIONS SUGGESTED TG ELICIT HERMES’ VIEWS ON CHILE'S ECONOMIC PROSPECTS AS REQUESTED PARA 3 REF- BATE: ORG: $-Pee-SO BE Behe COPED EGO RONATING OF Put, Hb Bas7 AFOUL BT Oe OF OOD Cas Ger ee a THRE REPRODUCTION BY OTHER THAN THE ISSUING OFFICE IS PRONIBITED E 2 IMPOET SECRET cL BY: O0S7S556 UNIT, : _ __ ExT: - {4 ~ fa? fo Sr 2 7 ahs = ‘ nee ug. a 2, seta SEVIS hen AN nh ea Hl archi etal ORE TE  e wy BRET ea est Rei ATLA id ede cas canes rt eon oo
14-00000 OUTGOING MESSAGE @F-7¢Cea Brad, COMTER UTE ONLF coe ane 106 a0 eS age 788 on oO Oo§ 0 GO GO 9. CLAS BPP At OOS SEcre T ne ; - BE RSASE MANOLIMS meats! Oats. Cee oenuF cre i BBAGs SEPARA SE MVBHSE oe , a _ 0 wees DISSEM BY: CONF: INFO; FILE wy Wp AC O wo woes , , Af 2 : > : 0 esruento PER A. HOW MUCH AND WHAT KINDS OF PRIVATE DIRECT FOREIGN IN- VESTHENT FROM GERMAN AND OTHER WEST EUROPEAN SOURCES IS EXPECTED TO ENTER CHILE DURING NEXT 12 MONTHS? B. D0 BANK OFFICIALS EXPECT SUBSTANTIAL PRIVATE AND /OR 7 OFFICIAL GERMAN CREDITS TO BE EXTENDED TO CHILE DURING NEXT 42 nONTHS? : WHAT TYPES OF CREDITS UOULD THESE BE. I.E. BALANCE “OF PAYMENTS RELIEF. DEVELOPMENT ASSISTANCE. TIED AND UNTIED TRADE CREDITS? C- DO BANK OFFICIALS SEE THE WIDESPREAD ADVERSE PUBLIC | REACTION IN EURCPE TO THE NEU CHILEAN GOVERNMENT AS: SIGNIFICANTLY "AFFECTING FUTURE INVESTMENT AND AID DECISIONS FOR CHILE? HERMES’ REACTION TO ANALYSIS AND RESPONSE TO QUESTIONS” WILL B 3: BE OF INTEREST. | ! ; . : Co ye FILE: 5-L2b-52- £2. IMPDETed | “eREF ATTACHED. a : an HG ; ‘pave: 4 DECEMBER 2973 i ORIG: uO . unit:  C/UH/B7SA we . ext: LLNU/LOLS C/WH/b : | ; C/E/G "ore i ACZUMD cow Ba18 agreey orrces CO ata om &- Ore dB. ~ @ BAT ag CS Tie OPRCER * cinssenarow eo = 2 IMPDET | SECRET REPRODUC)._.¢ BY OTHER THAN THE ISSUING SFEMLE IS PRE CL BYOS?SSb
14-00000 ; nu ao 0 " g | nen s bo cRET oO _ 2" OSS We: 27 STAFF QuLS34Z-" DERECTYR : “45955? CONF: efoiit S wro: re re li tei", fo aa / ee a) it aoc “yor petonrry| RYBAT FUOMEN WEF? DIRECTOR-45d24h a Ll. FOLLOWING INFO CLEARED FOR ORAL FUONEN GRIEF LHGS, STIPU- LATION NO FURTHER EXPLOITATION « SOURCE: CHILEAN CITIZEH RESIDING TH LIMA. B+ SUBJECT: P98 SIBLE SUPPORT BY LATIN ANERTCAN COMMUNIST PARTIES FOR RESTS TANCE IN CHILE. 2 eee rn agen ae tr ce 3. BACKGROUND: IT WAS ONNUINGICATED IN Ant EARLIER BRIEF TUG {RUF} THAT SOVIET CONNUNIST PARTY OF PERU {PCP/SOVIETH INTENDED TO SERVE AS A RECEPTION POINT FOR GUERRILLA FIGHTERS FROM OTHER COUNTRIES WHO WOULD ENTER CHILE FROM PERU TO JOEN ANY RESTSTANCE MOVENENT ITM CHILE. THE FIRST WORD OF CHILEAN COUP WAS RECCIVED BY PCA/SOVIET ue ; ; . EBS ; FROM CHILEAM EMBASS’ IN LIMA. CENTRAL COMMITTEE CALLED AM EMERGENCY MEETING WHEN IT APPEARED THAT EVENTS IU CHILE DERE COTNG AGAINST PATE ; : a LAE: ait: , iil. Lot . Aer Fore OTin, FT 1ekh EPO E COW lees BRE 9 Fe toh MeL eAsieys OOO ew NEPQONUCTION BY OTHEN TIEAIE THE 1SSuis CPFFICE tS PROMIMTED E 2 PMPOET SECRET ~ . ch ay; 497556
Y - a | 0 0 ~ a ao STAVE DIRECTOR INFO: | FILE WS 4589. MLLEUIE REGIME. UHILE YATTING FOR WO NGAGE Mere Reh ets noee Ols5EM BY: Oo swinore Doasnmane PER DO woenes # & INSTRUCTIONS FROW ROSCOU, CENTRAL COuALTTEE DEC DED TAKE CENTAIN NEASURES SUCH AS SENDING SIX S2GASEEERS INTO CHILE. THESE ORGANIZERS WERE NEMGERS OF PERUVIAN Wislagnaasy COUNEGIST YOUTH. WHO USED PASSPORTS OSTALINED EARLIER FROM CHILEAH ENSASSY IM CASE OF SUCH AN EMERGENCY. SUT DATA IN THEM, INCLUDING NAMES. VERE FALSE. THE TO CROSS INTO CHILE AT THE TACNAZARICA BORDER POINT “ACCOUPANTED BY A NUNBER OF BOLIVIANS AND ORAZILIANS. PASSPORTS WERE LEGITIMATE s PERUVIANS WERE AND WERE TO. BE S- ON LG SEPTEMBER. TYO UNTDENTIFIED NEN WHO YERE LATIN Abiqg TUSTRUCTIONS FROM THE COnmnUNIST PARTY OF THE SOVIET ANERTCANS GUT NOT ‘PERUVIANS BROUGHT TO PCP/SOVIET READQUARTERS - UNION {CPSU}. TNSTAUCTIONS WERE DELIVERED TO MNENBERS OF. PCP/SOVIET CENTRAL COMMITTEE AND INMEDIATELY DISCUSSED BY PARTY LEADERS INCLUDING JORGE BEL PRADO CHAVEZ {PC “€PCP/SOVIET POLITICAL COMMISSION NENBERF. GUTLLERNO TWO COURTERS THE NULSENOS {ALSO MENBER OF PCP/SOVIET POLITICAL Cont DELIVERING THE THSTRUCTIONS 2 P/SOVIET SEC GEN}. FELIX ARIAS SCHREIBER HERRERA TSSION}. AND 2 YHO USED THE ALIAS "FIGUEROA." FOLLOWING PISCUSSTON, THESE PARTY LEADERS DATE: one: a LEAD ExT: 7 wwe . STL es Oboe, COED * COL RS WAT. ei eH sree REPROOUC «A AY OL IER MAN TNE I7SUINT OFE-CE 15 PR BITED “SECRET _ - a eure OP eT CoN e —& 2 PAD DET { cu py; US?5Sb
14-00000 j CUTE OTIS PEAS ah mw ae tee abe t TIGA COU UG Oe ‘ * a ie. wen | re I . | wee eee . « Oo ae fue one eens f . ad - oe vee ue raves i or a a 6g 3 ; Rn ET | . Svinte tet, MES DARE UEnUe one _ REAP Rwe Berere kee KURTA AVE DIRECTOR . CONF FO: FILE ~ . Y 4988 7 4 ee “een mv . OQ vvenro HERD CEGAG PREPARETNG INSTRUCTIONS FOR PARTY MEUSERS TO AT) IN- SUPPORT. _ ARTS Iu PARTY OF INITIAL VTETR Je Ri erty rssh RS OF COUNTERP ECTIONS TO PCR/SOVIET HENGERS WERE TO ARRANGE Fer LODGING FOR THE COMMUNIST CHILE {PCCHE. OTHER LATIN AMERICAN COMMUNIST PARTIES Ho WERE ARRIVING Le Gh LIAS TO OBTAIN HAPS OF SECOND STAGE OF SUPPORT To CHILE YAS TO QEGIN QURING WEEK CHILE. FALSE DOCUNENTATION, ETC. TOT ee ee ey mre ete ee ee hs mene ee mee me S¥ 23 SEPTEMBER UHEN COMMUNISTS AND OTKERS WERE To ARRIVE FROM LDA GOES, tui) VENEZUELA PANAMA, COLOMDIA, CUBA AND OTHER i a ALL WERE TO BE : LODGED IN LIMA> ANDs LATER, GIVE FALSE DOCUMENTS AND TRANSPORTATION ‘ TO CHILEAM BORDER. THEIR PRINCIPAL TASK Zit CHILE WAS TO ASSIST Til REORGANIZATION OF PCCH FOLLOWIEG COUP D'ETAT, AS KELL AS IN PRO- DUCTION OF CLAIDESTINE PROPAGANDA. THEY ALSO WERE TO STUDY PoOSsT- “OILITY oF AIDING IN MOUNTING CONCERTED ARMED RESISTANCE TO MILITARY REGTIHEs PRINCIPALLY THROUGH URBAI GUERRILLA WARFARE. THERE YAS NO MEED TO SEND ARMS SINCE THERE STILL ENOUGH WEAPONS HIDPEN IN CHILE To NAKE SUCH” RISK UNNECESSARY. 4 2 vO 2s CENTRAL AND SOUTH ASERICAN conmuNrsy S VERE TO MEET IN LIMA ; On 2S SEPTEMBER. TO CONSIDER SENDING PERSONS TO CHILE To ORGANIZE : OIG: 3 tudes 7S - -§2 FPA as ae wre CO eee See R hue BML AT as eRe Oe 8 ot ao rome REPS COUCHOM BY CHMER THAN TH isSuand OFFICE iS PR fOHIBIFED a. IN COCT SECRET : cL BY.QS7E5h
“te . BDO HV AALE EEE ME tae F Par OE ee SIRECTOR, - wry tp. th owves Nit BYE —Q Aust emmeee @ t OSE: : fiero; FILE C) eseieere FER t GUERGTLLA GROUPS THERE AMD TO AID CHEILEAT CONNUNINTS. SOME DELEGATES 7G MECTING ARRIVED EARLY TN ORDER ATTEND REGIONAL NSETING OF INTER= ° HATZOHAL LABOR ORGANIZATCOM €TLO} WIECH BEGAN VI SEPT. JUAN CAMPOS CARMOS. CHILEANS SECRETARY, FORLATIN AMERICAN AFFAIRS OF WORLD FEDER= ATION OF TRADE UNTONS {UFTUD, uo IS IM LIMA FOR ILO MEETING, HELD PRESS CONFERENCE ON 23 SEPTEMBER DURIIG UNICH HE CALLED ON ALL WORLD TRADE UNTON ORGANIZATIONS TO MOUNT PUBLIC OPINION CRUSADE AGAINST CHILEAN JUNTA. ‘Be FILE: 29-20-52. £2, LilPoeted 3 \ Ty oo cen oe ge para peey / CT Dre a . pe? fe ve Pen e ‘ -_ eee o os { ’ REPROD: NOB@ OUHMEYUAMSTHE beoUr 3S OF reLISS” perreo - ~ woe “ - nn iad SE S’R ET vee Soe