1. ITALY: THE NEXT SIX WEEKS
EMBASSY ROME HAS OUTLINED FOUR POSSIBLE OUTCOMES OF THE
JUNE 20-21 PARLIAMENTARY ELECTIONS.
--DESPITE THEIR DECLARATIONS TO THE CONTRARY, THE COM-
MUNISTS MIGHT ACCEPT A LEFT-FRONT GOVERNMENT, IF THEY
GET MORE VOTES THAN THE DC AND IF THE LEFT AS A WHOLE
WINS A MAJORITY.
--IF THE JUNE 1975 ELECTION RESULTS ARE REPEATED, MANY
OBSERVERS CONSIDER A DC-PSI ACCORD LIKELY, WITH THE
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SOCIALISTS INSISTING ON SOME SORT OF PCI "ASSOCIATION."
--AN "HISTORIC COMPROMISE" (DC-COMMUNIST) SOLUTION
IMMEDIATELY FOLLOWING THE ELECTIONS IS CONCEIVABLE BUT
UNLIKELY.
--A RETURN TO A "CLEAN" CENTER-LEFT COALITION (EXCLUD-
ING THE COMMUNISTS) APPEARS TO BE AN UNREALISTIC PRO-
SPECT.
EMBASSY COMMENT: THE COMMUNISTS ARE OFF AND RUNNING WITH A
CAMPAIGN AIMED AT PRESSURING THE DC TO ACCEPT AN ACCORD
WITH THEM. MANY IN THE DC WANT TO MAKE THE CAMPAIGN A REF-
ERENDUM ON THE COMMUNIST QUESTION, WHILE MOST OTHER PARTIES
ARE CONCENTRATING ON A RANGE OF ISSUES (THE ECONOMY, RE-
FORMS, GOVERNMENT INEFFICIENCY AND SCANDALS) OFTEN HARMFUL
TO THE DC. (CONFIDENTIAL) ROME 7477, 5/7.)
2. PORTUGAL
A. THE RIGHT LICKS ITS WOUNDS
EMBASSY LISBON HAS DESCRIBED PPD AND CDS REACTIONS TO THE
FACT THAT THE APRIL 25 ELECTIONS DID NOT PRODUCE THE SHIFT
TO THE RIGHT THEY HAD EXPECTED.
--PPD LEADERS SAY THEY WILL MOVE BACK TO THE CENTER-
LEFT, WHILE KEEPING PRESSURE ON THE SOCIALISTS TO FORM
A COALITION WITH THEM.
--THE CDS, HOWEVER, HAS VOWED TO INFLICT A "SLOW DEATH"
ON THE PPD IF THE LATTER DOES NOT ACCEPT AN ALLIANCE
WITH THE CDS.
--BOTH PARTIES APPEAR WILLING TO SUPPLY THE VOTES OR
ABSTENTIONS NECESSARY FOR A MINORITY SOCIALIST GOVERN-
MENT TO WIN A VOTE OF CONFIDENCE, IN RETURN FOR CON-
CESSIONS ON THE SHAPE OF THE PS PROGRAM.
EMBASSY COMMENT: THE PS AND THE TWO SMALLER PARTIES SEEM
DISPOSED TO COMPROMISE, BUT AGREEMENT WILL BE DIFFICULT.
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IN MAKING CONCESSIONS, THE PS WILL TRY NOT TO ALIENATE ITS
OWN LEFT. AN INFORMAL COMPROMISE BETWEEN THE PS AND THE
PARTIES TO THE RIGHT MAY BE ALL THAT IS POSSIBLE AT THIS
POINT.
B. OTELO IS WOOED
AT A MAY 7 LISBON SYMPOSIUM OF THE MARXIST SOCIALIST INTER-
VENTION GROUP, LISBON AND RURAL WORKERS' GROUPS PETITIONED
OTELO DE CARVALHO TO ACCEPT A PRESIDENTIAL CANDIDACY. OTELO
DECLARED THAT HE HAD NOT RULED OUT SUCH A BID, BUT WOULD BE
A CANDIDATE ONLY IF HE HAD "POPULAR SUPPORT."
EMBASSY COMMENT: OTELO'S EFFORTS, TO THE EXTENT HE CAN CAP-
TURE THE MILITARY FAR-LEFT, HAVE SOME POTENTIAL FOR DISRUPT-
ING THE COHESION ARMY CHIEF OF STAFF EANES HAS BEEN BUILD-
ING IN THE MILITARY. (CONFIDENTIAL) LISBON 3019, 5/7 AND
LISBON 3058, 5/8.)
3. SPAIN MOVES TOWARD NATO, BUT WITH DELIBERATE SPEED
USNATO HAS IDENTIFIED THE FOLLOWING FACTORS AFFECTING PLAN-
NING FOR THE MOVEMENT OF SPAIN TOWARD NATO MEMBERSHIP:
--WITH SPANISH-FRENCH MILITARY COOPERATION ALREADY AT
AN ADVANCED STAGE, THE NEXT MAJOR STEP WILL INVOLVE
DEVELOPING CLOSER RELATIONS WITH THE FRG.
--THE SPANISH ARE MORE INTERESTED IN THE EC THAN IN
NATO AND CANNOT BE EXPECTED TO PRESS FOR NATO MEMBER-
SHIP BEFORE THE 1980 TARGET DATE FOR JOINING THE NINE.
--ALTHOUGH ALLIED ANTIPATHY TOWARD THE REGIME IS SOF-
TENING, SPANISH POLITICAL EVOLUTION HAS NOT YET PROMPT-
ED QUALITATIVE CHANGES IN ATTITUDE.
AMONG LONG-TERM MEASURES TO INCREASE COOPERATION THE MIS-
SION ENVISAGES:
--CONSULTATIONS AT THE MFA POLITICAL DIRECTORS LEVEL
WITH THOSE ALLIES AGREEABLE TO SUCH MEETINGS;
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--REVIEWING SECURITY PROCEDURES WITH AN EYE TO RELEAS-
ING HIGH-LEVEL US DOCUMENTS, AND SUBSEQUENTLY NATO
MATERIAL, TO SPAIN; AND
--ENCOURAGING BILATERALS WITH OTHER ALLIES TO AVOID
THE SEMBLANCE OF A CLIENT RELATIONSHIP WITH THE US.
MISSION COMMENT: WE SHOULD NOT HOPE FOR TOO MUCH TOO SOON.
YEARS OF ISOLATION AND SUSPICION, STRONG DOUBTS ABOUT NATO
IN HIGH QUARTERS, AND OBSTACLES TO INTERNAL DIALOGUE WITHIN
THE GOS WILL NOT BE EASILY OVERCOME. (SECRET) NATO 2481,
5/7.)
4. INDIA AND PAKISTAN SCHEDULE TALKS
THE INDIAN MINISTRY OF FOREIGN AFFAIRS HAS ANNOUNCED THAT
TALKS WITH PAKISTAN WILL BE HELD MAY 12 THROUGH 14 IN
ISLAMABAD. DELEGATIONS AT THE TALKS WILL:
--BE LED BY THE FOREIGN MINISTERS OF THE TWO COUNTRIES;
AND
--DISCUSS RESUMPTION OF CIVIL AVIATION, RAIL AND ROAD
LINKS AS WELL AS RESTORATION OF DIPLOMATIC TIES.
(LIMITED OFFICIAL USE) NEW DELHI 6844, 5/8.) KISSINGER
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