NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A029600010002-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 20
• Document Creation Date: December 20, 2016
• Document Release Date: May 19, 2006
• Sequence Number: 2
• Publication Date: December 1, 1976
• Content Type: REPORT

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NATIONAL INTELLIGENCE DAILY CABLE
Wednesday December 1, 1976 CI NIDC 76-280C
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CIA-RDP79T00975A029600010002-1
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National Intelligence Daily Cable for Wednesda December 1, 1976.
The NID Cable is for the purpose of informing
senior US officials.
CHINA: Government Positions
UN: Election of Secretary General
USSR-US: Brezhnev Speaks on Relations
Page 1
Page 2
Page 3
EUROPE AND JAPAN: Computer Markets
WEST GERMANY: Nuclear Energy Dispute
Page 5
Page 6
PERSIAN GULF STATES: Foreign Ministers Conference
Page 7
NAMIBIA: Constitutional Conference
BANGLADESH: Zia Takes Over
INDIA: Another Good Crop
THAILAND-MALAYSIA: Prime Minister's Meeting
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Page 10
Page 11
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USSR - SAUDI ARABIA: Exchange of Broadsides
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A meeting of the standing committee of the National
People's Congress, China's legislature, opened yesterday in
Peking. The last and most important item on the agenda is ap-
pointments to and removals from high-level government positions.
These appointments were not announced yesterday
but are almost certain to include the formal replacement of the
minister of culture, an ally of the four fallen leftists. It
also seems increasingly likely that China's foreign minister,
Chiao Kuan-hua, will be replaced.
The Foreign Ministry in any case appears to be in for
a major shakeup. Chinese ambassadors to Canada, West Germany,
France, Italy, Japan, Turkey, and the UN have all been recalled,
apparently permanently. Some of these men may be in line for new
posts at home, but nearly all have been identified to some de-
gree with Peking's more outward-looking foreign policy of the
1970s. This, in addition to the extensiveness of the Foreign
Ministry shakeup, raises questions about a possible readjustment
in foreign policy. Thus far, the Chinese have been at pains to
emphasize continuity in their foreign policy since the death of
Mao.
I Yesterday's meeting featured a brief speech by Party
Chairman Hua Kuo-feng, who nominated Chou En-lai's widow to be
one of the vice chairmen of the standing committee of the Na-
tional People's Congress. Hua, whose speech was greeted with
"thunderous applause," is plainly trying to capitalize on the
immense popularity of the late Chou En-lai. Expressions of pro-
Chou sentiment, which were partially stifled for most of this
year as the leftists pursued Teng Hsiao-ping, have re-emerged
with the fall of the four leading lefti-a-.s.
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National People's Congress Vice Chairman Wu Te, who
seems a good bet to be promoted to chairman--a position roughly
equivalent to head of state--also gave a speech yesterday. Wu
hailed Hua's appointment as party chairman and acclaimed the
fall of the leftists. He reiterated the conciliatory attitude,
announced in a People's naiZy editorial on Sunday, toward lower
level followers of the leading leftists. Wu also called for the
continuation of criticism of Teng Hsiao-ping.
I I It has been rumored that Teng will be rehabilitated
now that his major detractors have fallen, but Wu's comment
strongly suggests that Teng's rehabilitation, while still likel
y
i
n the longer run, is not imminent.
I F
UN: Election of Secretary General
I I The UN Security Council will meet Friday to elect the
organization's secretary general for the next five years. The
Council's recommendation will be forwarded to the General As-
sembly, where the appointment has usually been confirmed unan-
imously.
I I Despite the introduction of some competition into
the race--outgoing Mexican President Echeverria, who has been
campaigning behind the scenes for months, formally announced
his candidacy yesterday--incumbent Secretary General Waldheim
appears to have the support to assure his re-election.
I I The Mexicans, however, apparently still consider
Echeverria a viable candidate. They have been counting on the
Chinese to veto Waldheim's re-election.
Only the five permanent members can veto a candidate;
the other four--the US, UK, France, and the USSR--support Wald-
heim's re-election. In a recent conversation, Mexican Foreign
Minister Garcia Robles reiterated his belief that the Chinese
had practically confirmed their intention to veto Waldheim,
thus throwing open the election to third-world candidates. This
could open the way to contenders such as Sri Lanka's Amerasinghe
as well as Echeverria.
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I IWe do not know Chinese intentions. They have repeat-
edly e ected requests for public support of Echeverria's can-
didacy by urging the Mexicans to seek broad third world support
first. The Chinese might, however, repeat their performance
in 1971 when they vetoed Waldheim on the first secret ballot
but then dropped their objections, permitting his election.
USSR-US: Brezhnev Speaks on Relations
Soviet General Secretary Brezhnev took the US to task
last night in a speech honoring Secretary Simon and the partici-
pants in the Fourth US-Soviet Trade and Economic Council.
Brezhnev's comments were clearly intended for the incoming US
administration and the new Congress. He summarized Soviet griev-
ances with Washington and expressed hope for expanded coopera-
tion in the future.
Brezhnev's complaints were not new, but he obviously
wanted to emphasize Moscow's view that in the key areas of trade
and arms control, the US is responsible for retarding progress
in US-Soviet ties and must take the initiative in getting rela-
tions back on track.
Brezhnev was quite blunt, as was Foreign Trade Minis-
ter Patolichev earlier in the day, in criticizing US trade pol-
icy toward the USSR. He said "we resolutely reject any attempts
to link trade with any political conditions and will not toler-
ate any interference in our internal affairs. This must be made
clear once and for all." He warned that US businessmen will con-
tinue to lose Soviet business unless US trade discrimination
against the USSR is eliminated.
The Soviets have given renewed attention recently to
the subject of US-Soviet trade, suggesting that they hope the
new administration will be able to work out an acceptable com-
promise with Congress. During the US presidential campaign they
reacted favorably to Governor Carter's comments concerning the
elimination of discriminatory trade barriers between the US and
the USSR and his characterization of the Jackson-Vanik amendment
to the 1974 trade bill as a "mistake."
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In his remarks last night, Brezhnev decried the anti-
Soviet rhetoric of the US election campaign and emphasized the
"clear and consistent" nature of Soviet policy toward the US,
especially in attempts to curb the arms race. Praising past Sov-
iet proposals and US-Soviet agreements in this area, he said the
USSR is prepared to go further in cooperation with the new admin-
istration "if it is prepared to act in the same spirit."
Brezhnev voiced strong support for limiting strategic
offensive arms and called for an intensification of efforts
to sign a new SALT agreement. He said that it is "high time to
put an end to the freeze of this important question imposed by
Washington" and that he expects an agreement to be based on the
Vladivostok understandings. He added that the USSR is prepared
to discuss possible new measures to prevent the proliferation of
nuclear weapons and reduce the threat of nuclear war.
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EUROPE AND JAPAN: Computer Markets
I //Some West European countries--generally the EC
nations--and Japan are continuing efforts to restrict US par-
ticipation in their domestic data communications, computer,
and computer-based service markets. The US currently holds
about 50 percent of the Japanese and 70 percent of the West
European computer markets.//
//The Japanese and West Europeans recognize that
are unable technologically to compete with the
t the
t
y
presen
a
US in such industries, and are imposing trade barriers and
stepping up domestic production and development programs in an
effort to limit US sales.//
//The trade barriers range from tariffs to exces-
sive re ape, such as requiring the use of some domestically
produced equipment and imposing unnecessary inspections. Japa-
nese tariffs on computer systems, for example, are three times
higher than comparable tariffs in the US.//
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//In Europe, development programs include th
e
planned establishment, by members of the EC, of Euronet, the
first international computer network to be built by state mo-
nopolies rather than by private enterprise.//
//The Euronet development schedule calls for the
establishment of facilities in each EC country by the end of
1979. European officials hope to develop and control shared
data systems through such multinational action, which they
feel is necessary to avoid future dominance by US corporations.//
//The Japanese government, which already provides
smite public computer and data communications services, plans
to expand and improve the quality of such services by install-
ing a digital data transmission network in March 1978. US firms
have a greater variety of services, better software, and lower
prices than are provided by the present Japanese network, but
Tokyo has effectively discouraged or directly prohibited US
competition.
WEST GERMANY: Nuclear Energy Dispute
The West German government's program calling for
expan ed use of nuclear power is under attack by increasingly
assertive environmentalist groups, which are putting pressure
on national political leaders to reconsider current policies.
In one of West Germany's first major public demon-
strati ons against the use of nuclear power, some 3,000 demon-
strators in Schleswig-Holstein in late October attacked police
protecting a site for a new nuclear power installation. The
clash received widespread media coverage and focused attention
on the concerns of many West Germans over possibly damaging
side effects of radioactive nuclear waste.
Most government leaders see no practical
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a
ernat
ve
at present to increasing reliance on nuclear power. Chancellor
Schmidt has publicly defended the government's stand, and opin-
ion polls show that the antinuclear groups have attracted only
marginal support among workers. Many officials, however, openly
admit that it will be increasingly difficult to press for the
maximum goals outlined in the energy program.
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4Economics Minister Friderichs, who plays a central
role in he formulation of nuclear energy policy, faces oppo-
sition from his fellow Free Democrats, who passed a resolution
last week at their national convention calling for a reduction
in the government's nuclear program. The official press service
of Schmidt's Social Democratic Party has published a similar
plea from Social Democratic leaders in Schleswig-Holstein.
National leaders representing the two coalition
parties are currently working on the government program for
the next four years and will work hard to prevent tthe nuclear
energy issue from undermining negotiations between the parties.
Friderichs has hinted privately that a slight cutback in the
nuclear program may be possible if the growth rate of the con-
sumption of electricity slows by 1.985, as is now anticipated.
For the moment, the Schmidt government will try to
convince the public that measures are being taken to protect
the environment. Interior Minister Maihofer, a Free Democrat,
recently sent an open letter to a prominent citizens' group
declaring that operating licenses for reactors will be issued
only after applicants have demonstrated that th have devised
safe methods of disposing of radioactive waste. 25X1
PERSIAN GULF STATES: Foreign Ministers' Conference
//The foreign ministers of the countries on the
Persian Gu were unable to agree on a formula for closer co-
operation on regional issues during a two-day conference in
Oman last week.//
The conference was the fourth meeting since July 1975.
Each has ended with talk of further sessions, but the prospect
for meaningful cooperation, especially on regional security, is
receding.
The attendance of Iraq at the meeting assured its
Iraqi leaders support regional cooperation only among
failure
.
Arab states--thus excluding Iran--and only on such prosaic sub-
jects as information and health. They refuse to discuss re-
gional cooperation on security matters.
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The Iraqi foreign minister attended the meeting only
a ter failing in his efforts to have it called off. Preliminary
reports indicate he took a very negative line on the agenda,
insisting that discussions be limited to the question of free-
dom of navigation through the Strait of Hormuz.
Iraqi diplomacy is aimed at blocking any regional
formula that limits the movement of ships through the strait.
Iraq believes that Iran could ultimately use such restrictions
against Iraq and its patron, the USSR.
Iran, supported by Oman, takes the position that the
Persian Gulf is a closed sea from which foreign military pres-
ence must be excluded. In law of the sea negotiations, the two
governments support the restrictive "innocent passage" princi-
ple for the Strait of Hormuz, while Iraq supports the principle
of "free passage."
I I The Shah of Iran has been virtually the only advo-
cate o a comprehensive multilateral security pact for the Gulf
region. He regards such a pact as a way to consolidate Iran's
already strong position and as a vehicle for employing Iran's
power in a policing role.
Political developments in early 1975, including a
politica accord between Iran and Iraq, encouraged the Shah to
believe progress on a pact was possible. Subsequent develop-
ments have almost certainly convinced him a pact is not now at-
tainable.
I I Bilateral ties, like those developed in recent years
e ween Iran and Oman, offer an alternative way of employing
Iran's power in the region. Although the Shah continues to push
publicly for a collective agreement, privately he may have al-
ready switched the emphasis to the bilateral channel.
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Iran's foreign minister traveled directly to Kuwait
following the Oman conference. He is quoted in the Kuwaiti
press as saying that collective agreements are preferable, but
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the only kinds of agreements that seem possible now are bilat-
eral ones. The Shah is especially concerned about Kuwait's
security because of its border dispute with Iraq.
Iran may also be thinking of adjusting its pol-
icy toward Iraq in light of Ba hdad's continuing. refusal to
cooperate on regional issues.
The Shah recent y referred publicly to Iraq as a surroga e tor
the USSR.
The Shah may be returning, at least part way, to his
previous policy of portraying Iraq as an agent for instability
in the Gulf and of seeking Iraq's diplomatic isolation.
South African Prime Minister Vorster's meeting last
Thursday with a committee of the multiracial Namibian consti-
tutional conference seems to have forestalled a collapse of the
conference. No apparent progress was made at the meeting, how-
ever, toward resolving the impasse between white and nonwhite
participants.
The committee had requested the meeting with the
Prime Minister because its efforts to devise a multiracial in-
terim government for Namibia, which South Africa administers as
a trust territory, were stalled by basic disagreements among
the 11 delegations to the conference. The delegations represent
the whites and the 10 nonwhite ethnic groups inhabiting the
territory.
Most of the white members of the committee have in-
sisted on interim arrangements that would diffuse power among
the existing ethnic homelands in a loose federal system instead
of setting up a strong central government. Such a system would
enable the whites to maintain control of Namibia's rich mineral
resources even though they make up only 12 percent of the pop-
ulation.
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Shortly before the constitutional committee went to
Pretoria to meet with Vorster, some of its nonwhite members
told the press that a loose federal system was unacceptable.
They also said they intended to ask Vorster to press the hard-
liners in the white delegation to yield to the nonwhite majority.
I I We do not know how Vorster coped with such demands
a e meeting last Thursday--his first with any of the non-
white delegates. The lone white moderate, who is chairman of
the committee, told the press that Vorster was ready to back
any form of interim government that was agreed upon by the con-
ference.
According to the US embassy, guarded commentary from
several participants at the meeting indicates that Vorster
stressed the urgency of reaching an early consensus on forming
a government, but made no clear effort to encourage the white
hardliners to compromise with the nonwhites.
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Bangladeshi General Zia ur-Rahman, de facto leader of
the country since the military coup of November 1975, assumed
full powers as chief martial law administrator late Monday. The
title had been held by President Sayem, who remains president
but is relegated to a ceremonial status only.
Within hours of Zia's formal takeover, political
leaders of most major parties were under arrest;
on a ar Mushtaque
me ea er of the Democratic League and president of Bangla-
desh for two months prior to Zia's assumption of power last
year, may be tried for his alleged role in the murder of sev-
eral political leaders.
President Sayem had publicly promised elections by
next February and was apparently the major advocate within the
government of a return to normal political activity. The Sayem
administration began preparations for elections last summer by
reviewing the charters of some 50 groups seeking status as legal
political parties and by eventually approving 21 of them.
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I Other government and military officials apparently
persuaded Zia that a return to political activity would regen-
erate the political violence that traditionally accompanies
Bangladeshi politics.
Although no overt opposition to the postponement of
the elections has yet appeared, US embassy sources report that
veral of the more influential politicians may already have
se
been organizing opposition to the government. Zia presumably
also saw arrests as a way to remove possible rivals--particu-
larly Mushtaque, who has significant popular support--at least
temporarily from the public eye.
Zia presumably will continue to rely on knowledgeable
civilians to run much of the government, particularly the min-
istries of economics and foreign affairs. Zia may eventually
loosen restrictions on political activity and begin once again
to prepare the country for a return to parliamentary rule, or
decide to institutionalize his personal rule, as Ayub Khan
institutionalized his rule in the united Pakistan of 1958.
Regardless of Zia's final choice, should serious op-
position develop in the interim, he can be expectea to move
quickly and effectively to counter it.
INDIA: Another Good Crop
India i
consecutive year.
s harvesting a bumper grain crop for the second
Foodgrain production reached a record 118 million tons
for the crop year ending in June 1976 and should range from 107
million to 112 million tons this crop year. Foodgrain output
averaged only 102 million tons annually during the preceding
four years.
I I Good weather has been primarily responsible for the
larger harvests, although increased use of fertilizer and of
better seeds have also contributed.
Grain import orders were suspended last spring and
are not likely to be resumed any time soon. Barring a poor
spring crop, which appears unlikely, no new import commitments
are expected before mid-1977.
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Two good harvests in a row are severely straining
India's food storage capacity. Buffer stocks now total 17 mil-
lion tons and are likely to increase further. India has perma-
nent facilities for some 12 million tons; much of the remainder
has been stored in the open.
The upturn in agriculture--and in the overall economy--
is largely responsible for the calm political atmosphere that
has prevailed since Prime Minister Gandhi tightened her hold over
the government in mid-1975. The absence of significant public
discontent has enabled her to concentrate on restructuring the
government along authoritarian lines, and to postpone national
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THAILAND-MALAYSIA: Prime Minister's Meeting
Malaysian Prime Minister Hussein and Thai Prime Min-
ister Thanin met on Monday and agreed "in principle" to cooper-
ate more closely in operations against communist insurgents in
the Thai-Malaysian border area.
I I Lower level officials of the two governments have
been negotiating on the problem since early November. On Novem-
ber 4, the Malaysian home minister went to Bangkok to lay the
foundation for a resumption of formal border talks that have
been suspended for more than six months. A meeting between high-
level security and military officials of the two sides was held
in Penang, Malaysia on November 11.
Beyond this, the Malaysians appear to have allayed
the suspicion in Bangkok that they are secretly supporting the
large Muslim population in southern Thailand that wants to be-
come part of Malaysia. The Thai had insisted--as a condition
for joint military actions against communist insurgents--that
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the Malaysians also participate in joint operations against
the Muslim separatists. During the meeting on November 11, how-
ever, the Thai dropped this demand and unconditionally agreed
to restore joint operations on the insurgency problem.
The joint border operations are particularly impor-
tant to the Malaysian counterinsurgency program as the insur-
gents, without official Thai sanction, continue to cross the
border for sanctuary. An agreement broke down last April when
the Malaysians violated it by bombing Thai territory.
With the conservatives in Malaysia's ruling party
pressing Prime Minister Hussein to take a tougher attitude to-
ward communists in general, Hussein will find it politically
useful to point to improved border cooperation with the Thai.
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USSR - SAUDI ARABIA: Exchange of Broadsides
//Soviet opposition to Saudi Arabia's increasingly
active role in the Middle East and North Africa has led to a
rare exchange of broadsides between the two countries.//
On November 26, an article in the Soviets' New Times,
an unofficial weekly often used to float trial balloons in for-
eign policy, accused the Saudis of promoting defense links be-
tween the US and the Arab countries and of supporting "reaction-
ary" forces in Lebanon. The Saudis responded the next day, call-
ing the USSR a "master of mischief and slander" against commu-
nist as well as noncommunist governments.
//Both countries have previously avoided open ex-
changes of hostility, but the USSR has become increasingly re-
sentful of Saudi Arabia's use of political and economic re-
sources to play an influential role in the area. In the past
several months, for example, the Saudis have worked to arrange
a cease-fire in Lebanon, narrow Egyptian-Syrian differences,
and cool the Algerian-Moroccan dispute over Western Sahara.//
//The Soviets are disappointed that nothing came
of what appeared to be a more conciliatory Saudi attitude to-
ward Moscow following Faysal's assassination. The USSR broke
diplomatic ties nearly 40 years ago but has long been trying to
reinstitute them.//
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