NATIONAL INTELLIGENCE BULLETIN

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• Collection: General CIA Records
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• Document Page Count: 15
• Document Creation Date: December 16, 2016
• Document Release Date: February 22, 2005
• Sequence Number: 22
• Publication Date: December 13, 1976
• Content Type: REPORT

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NATIONAL INTELLIGENCE DAILY CABLE
Monday December 13, 1976 CI NIDC 76-290C
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NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
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National Intelligence Daily Cable for Monday, December 13, 1976.
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11 1 The NID Cable is for the purpose of Informing
senior US officials.
CONTENTS
LEBANON:
Situation Report
Page 1
SPAIN:
Leftists
Page 3
THAILAND-VIETNAM:
Military Moves
Page 5
JAPAN: Exporting Industrial Plants
Page 6
BANGLADESH-CHINA:
Zia Visit
Page 8
SOMALIA-FTAI: Leadership Change
Page 9
VENEZUELA: Labor Peace
Page 10
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LEBANON: Situation Report
President Sarkis' appointment last week of a cabinet
of technocrats appears to have raised confidence among most
Lebanese that he will be able to assert his authority over the
political leaders who fomented the war. The formation of an
apolitical government was a victory for Sarkis over Camille
Shamun and others who had argued for a cabinet that reflected
the political interests of the major Lebanese factions.
Although Sarkis was able to have his way primarily
because of Syrian military backing, his own careful planning
and the strong support he is receiving from the Christian Pha-
lange Party also helped him pass this first major test of polit-
ical strength.
Leftist leader Kamal Jumblatt, who presumably feared
that Sarkis might bow to pressures from Shamun, strongly en-
dorsed the new cabinet. Among the other key Christian and Mus-
lim leaders, only Shamun has voiced opposition; he is especially
unhappy with the appointment of Prime Minister Salim al-Huss
and Foreign Minister Fuad Butrus, both of whom were associated
with one of Shamun's major political rival, the late president
Chehab.
The otherwise favorable reaction to the cabinet and
the new confidence in Sarkis should improve the government's
chances of receiving emergency powers from parliament. Salim
and Butrus apparently are preparing the request and a general
policy statement for the new government, which will be presented
to parliament within the next few weeks.
Sarkis wants to establish security and begin recon-
struction before he tackles the contentious issue of political
reform, and his presentation to parliament will probably reflect
these priorities. His strategy is to deny both Christian and
Muslim combatants the option of resuming hostilities before
they enter into negotiation of a final peace settlement. Sarkis
also wants to have an overall reconstruction program well under-
way before peace talks begin so that its progress and content
will not be subject to sectarian bargaining.
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The President will meet his greatest opposition from
Shamun and Jumblatt, both of whom have recently warned that
restructuring Lebanon's political order must take precedence
over all other matters. Both seem to be keenly aware that
Sarkis is trying to push Christians and Muslims into a position
where they will have to make concessions. Ironically, Shamun
and Jumblatt will probably join forces in opposing Sarkis' plan
to declare a state of emergency and to seek extraordinary powers
from parliament. Even together, however, they do not control a
sufficient number of parliamentary deputies to block Sarkis'
request.
The governor of Bint Jubayl Province, the scene of
much of the fighting in the south, reportedly announced late
Friday that he had worked out a truce agreement between Muslim-
Palestinian forces in the city of Bint Jubayl and Christian
troops in surrounding villages.
The announcement, which was carried in only one inter-
national press dispatch, asserted that the warring factions had
agreed to withdraw from their positions and allow civil servants
and local police to return to their posts. The reunification
over the weekend of Lebanese radio stations formerly held by
rival Christian and Muslim groups and the termination of broad-
casts on the security situation make it difficult to confirm
the existence of the alleged agreement.
I President Sarkis has encouraged and may ultimately
impose ormal censorship of reporting on security matters in
an effort to keep tensions in one area from spreading to other
parts of the country.
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Some Spanish leftist groups, opposed to having the
present government preside over political reform, are stirring
up trouble just before the referendum on political reform to
be held Wednesday. Their actions are causing tensions but are
not likely to affect the expected large favorable vote.
On Saturday, four terrorists kidnaped Antonio Maria
de Oriol, a banker and politician who is president of the ad-
visory Council of State and a member of the Council of the
Realm--Spain's highest consultative body. Oriol is a wealthy
Basque and former minister of justice who supported Franco
during the Civil War and profited financially from this tie,
thereby incurring the hatred of many Basques.
Government authorities speculate that the abduction
is the work of one of the several branches of the Basque ter-
rorist organization known as ETA. Oriol's son, who was present
during the abduction, has identified one of the assailants
from police photographs as a member of ETA.
Conflicting claims about the kidnaping are adding
to political tensions. An anonymous caller claiming to speak
on behalf of ETA, told a Madrid newspaper that Oriol had been
executed. Leaders of the two principal ETA groups denied any
involvement. They said that if the kidnaping had been carried
out by an ETA group not dependent on their group, the ransom
would be release of imprisoned Basque terrorists, who were ex-
cluded from an earlier grant of clemency by King Juan Carlos.
A far left Communist organization known as GRAPO in
a letter to another Madrid newspaper claimed credit for the
kidnaping and demanded the release of extreme militants held
in Spanish jails in return for Oriol's life. The newspaper said
it could not guarantee the authenticity of the letter. GRAPO
has committed other terrorist acts, and some of its members are
still in prison.
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THAILAND-VIETNAM: Military Moves
25X1, I -]the Lao government has been plagued by continued,
and possibl accelerating, dissident activity. Lao rightist guer-
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harassing outposts, an ma i.ng arg areas of Laos insecure.
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Although the Vietnamese were initially reluctant to
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get involved in anti-insurgency operations in L
tiveness of the Pathet Lao has increasingly dra
aos, the ineffec-
wn Vietnamese
troops into joint operations.
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Relations between Thailand and Vietnam have deterior-
ate a y since the coup in Bangkok on October 6. An expansion
of Vietnamese troop strength in Laos--for whatever reason--is
likely further to stimulate the anti-communist and anti-Vietnamese
feelings that have been running high in official circles in
Thailand since the military takeover.
The new government tends to see a heightened threat
from both the domestic communist insurgents and from its Indo-
chinese neighbors, and this perception has been reflected in a
rash of statements about Vietnam's belligerent intentions. An-
other result has been government plans for a considerable in-
crease in military expenditures.
Hanoi has reacted sharply to official Thai statements
warning of Vietnamese aggression against Thailand, calling such
charges an excuse for more US military aid and the re-opening of
US military bases in Thailand.[ I 25X1
JAPAN: Exporting Industrial Plants
Japan's exports of industrial plants have outpaced
most of its other foreign sales since 1970. The Japanese have
continued to shift their exports away from textiles and other
labor-intensive products that face stiff competition, partic-
ularly from South Korea, Taiwan, and Hong Kong.
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a so aime at aiding domestic economic recovery. Exports will
account for a third to a half of the growth in gross national
product this year.
25X1 Tokyo's recent efforts to promote plant exports are
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Since 1970, Japanese exports of industrial plants
have grown at an average annual rate of 36 percent, reaching
an estimated $6 billion this year. As a result, Japan has moved
into third place among developed countries in plant sales,
ahead of France and the UK but far behind West Germany and the
US. Overseas plant sales now represent 9 percent of total Jap-
anese exports, more than double the 1970 share.
cations facilities. More than 40 percent of the contracts have
included construction, startup costs, and the training of
workers.
Nearly two thirds of the plant sales are concentrated
in product lines in which Japan has traditionally excelled--
steel, chemical fertilizer, electrical equipment, and communi-
I all of the growth in plant exports has come
from sa es to developing countries, particularly to members of
the Organization of Petroleum Exporting Countries and countries
in Southeast Asia. Sales to developing nations now account for
81 percent of Japan's plant exports.
inexperience in foreign construction markets.
because of their lower labor costs. Many Japanese firms, now-
ever, think they have lost large projects because of relative
Japan was one of the first developed countries to
emphasize plant sales to OPEC members; these exports quadrupled
in 1975 and far outpaced the growth of sales to all other re-
gions. Japanese firms also participated early in large-scale
projects in other developing countries, such as the Pohang steel
complex in South Korea.
Japanese firms in 1975 won 58 percent of the contracts
for which they competed with other foreign suppliers, according
to a recent survey by the Ministry of International Trade and
Industry. Japanese firms are able to underbid other competitors
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To strengthen Japan's competitive position, the min-
istry has proposed a 35-percent increase next year--to $5 bil-
lion--in the capacity of Japan's Export-Import Bank to finance
Japanese exports. Tokyo will probably also broaden the bank's
financial backing to include a plan for insuring private loans
to Japanese firms, which have argued that they have lost more
contracts than they have won when financing has been a major
issue.
Based on contracts already signed, we expect Japanese
plant exports to continue expanding rapidly, totaling perhaps
as much as $10 to $12 billion in 1977. With continued support
from the government, plant exports could reach 18 percent of
total Japanese exports by 1980, placing them with steel and
autos as Japan's chief export items.
I I Much of this growth will continue to come from sales
to developing countries. Shipments to China are expected to
slip, at least through 1977, because China's political changes
and hard-currency shortage have slowed negotiations on new con-
tracts. F77 I
Bangladeshi strongman General Zia ur-Rahman may visit
Peking December 19, but the trip has not yet been announced
by either government. Relations between Bangladesh and China
have been improving since the martial law administration took
power in Dacca last year.
If Zia goes, it would be his first visit to China. The
most pressing item on Zia's agenda would probably be a request
for military equipment, which Bangladesh also has requested from
several other countries.
A Chinese trade delegation visited Bangladesh and
initiated trade, protocol, and payments agreements that are to
be signed next year. While in Dacca, the delegation leader pub-
licly stated that China would "oppose any foreign interference
in the internal affairs of Bangladesh"--an obvious reference to
India.
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I I China nonetheless seems eager to cement its relations
with the Zia government without directly antagonizing India.
China and India exchanged ambassadors this year for the first
time since 1962, and the Chinese presumably would not want to
jeopardize this relationship.
SOMALIA-FTAI: Leadership Change
25X1 I I President Siad last week removed five top leaders of
the oga iscio-backed Front for the Liberation of the Somalia
Coast who disagreed with the Somali President over tactics to
be used toward the French Territory of the Afars and Issas,
which is scheduled to become independent next year.
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According to Radio Mogadiscio, the five were accused
o in i rating armed gangs into the FTAI to cause "needless
disturbances," kidnaping, plotting to assassinate members of
both the Front and its ally, the African People's Independence
League, and misappropriating Front funds.
cautious approach in advancing his goal of annexing the FTAI.
Siad believes political developments in the territory are work-
ing to Somalia's advantage, and he is attempting to influence
that evolution by political action and by improving relations
with France.
ship of the Front reflects Siad's recent shift toward a more
The removal of advocates of violence from the leader-
Siad is keeping his other options open, however, by
training guerrillas and strengthening army units along the FTAI
.border; he is willing to turn to guerrilla warfare or direct
military action to gain control of the FTAI if other methods
fail.
of Somalia's ruling political party.
Liberation Front within the past year. One leader was ousted
in December ]975, and his replacement was dismissed last Au-
gust. Both apparently resented being used as puppets by Siad.
The Front is directed by a senior Somali military officer who
is a cabinet minister and a member of the central committee
This is the third change in the top leadership of
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The conclusion of long-term contract talks between
the Venezuelan government and the petroleum and iron workers
essentially completes the nationalization process begun by Pres-
ident Carlos Andres Perez over two years ago.
Most attention has been focused on the country's two
petroleum federations, which signed their first collective con-
tract with the government on December 2. The three-year settle-
ment includes wage increases of 12 percent to 16 percent. Fringe
benefits, including retirement pay--in some cases amounting to
almost 80 percent of the worker's wage--have been substantially
increased.
The new wage scales and benefits are well above the
level enjoyed by the average Venezuelan worker. The terms are
also slightly better than the new wage contract granted the iron
miners last month, thus maintaining the long-time relationship
between salaries in the country's two major extractive indus-
tries.
Union acceptance of the contract terms guarantees the
Perez government a lengthy period of tranquility in the nation-
alized petroleum fields and iron mines.
The government had been walking a tightrope with the
labor unions since nationalization. On the one hand, it had to
ensure that the oil industry remained productive, profitable,
and efficiently managed. On the other, it had to maintain peace
among industry employees and provide them with a contract that
was satisfactory to a wide ran a of workers--unskilled to highly
qualified technical personnel.
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