NSPG MEETING - TUESDAY, 13 JULY 1982

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84B00049R000701830025-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 25
• Document Creation Date: December 20, 2016
• Document Release Date: July 11, 2006
• Sequence Number: 25
• Publication Date: July 12, 1982
• Content Type: MEMO

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Central Intelligence Agency
12 July 1982
MEMORANDUM FOR: The President
the Vice President
The Secretary of State
The Secretary of Defense
The Counsellor to the President
The Director of Central Intelligence
The Chief of Staff to the President
The Deputy Chief of Staff to the President
The Assistant to the President for
National Security Affairs
SUBJECT : NSPG Meeting - Tuesday, 13 July 1982
The attached is provided for your use and information at
the NSPG meeting on 13 July 1982.
Executive ecre ary
Attachment: SNIE 82/83-82: Short-Term Prospects
for Central America dated 8 June 1982
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Intelligence
Special National Intelligence Estimate
Secret
SNIE 82/83-82
8 JunC 1982
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SNIE 82/83-82
SHORT-TERM PROSPECTS
FOR CENTRAL AMERICA
Information available as of 8 June 1982 was
used in the preparation of this Estimate.
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THIS ESTIMATE IS ISSUED BY THE DIRECTOR OF CENTRAL
INTELLIGENCE.
THE NATIONAL FOREIGN INTELLIGENCE BOARD CONCURS.
The following intelligence organizations participated in the preparation of the
Estimate:
The Central Intelligence Agency, the Defense Intelligence Agency, the National Security
Agency, and the intelligence organizations of the Departments of State and
the Treasury.
Also Participating:
The Assistant Chief of Staff for Intelligence, Department of the Army
The Director of Naval Intelligence, Department of the Navy
The Assistant Chief of Staff, Intelligence, Department of the Air Force
The Director of Intelligence, Headquarters, Marine Corps
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CONTENTS
Page
EXECUTIVE SUMMARY ......................................................................................... 1
KEY JUDGMENTS .................................................................................................... 3
DISCUSSION .............................................................................................................. 7
Regional Overview ................................................................................................. 7
The Threat From Cuban and Nicaraguan Subversion ........................................ 9
Support for the Salvadoran Guerrillas ............................................................... 9
Support for the Guatemalan Guerrillas ............................................................. 9
The Threat to Honduras .................................................................................... 11
The Threat to Costa Rica ................................................................................... 11
Prospects for Sandinista Rule in Nicaragua .......................................................... 12
Trends in the Target Countries ............................................................................. 13
El Salvador .......................................................................................................... 13
Guatemala ........................................................................................................... 14
Honduras ............................................................................................................. 15
Costa Rica ............................................................................................................ 15
The International Arena and the Diplomatic Front ............................................ 15
Outlook: Continuing Threats in the Region ......................................................... 17
iii
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EXECUTIVE SUMMARY
? With important outside support, moderate groups in Central
America have been strengthened in a number of respects,
politically and militarily, in recent months. Domestic support for
Marxist-Leninist groups and radical causes has diminished, at
least for the moment.
? It should be emphasized, however, that the magnitude and
complexity of domestic vulnerabilities and Communist-support-
ed subversion in Central America will remain so great that the
recent positive developments will almost certainly not be sus-
tained in the absence of continuing strong external support.
? The principal threats to US and allied interests will be posed by:
- The development of an increasingly strong Sandinista
regime in Nicaragua, and that regime's continuing cooper-
ation with Cuba in promoting Marxist revolution elsewhere
in Central America, together with its military buildup
toward dominance over its neighbors.
- Heightened foreign-supported subversion aimed especially
at El Salvador, Guatemala, and Honduras, along with new
problems deriving from possible Nicaraguan military repri-
sals against exile bases in Honduras in the event of
continuing provocations staged from those bases.
- The continuing critical nature of economic weaknesses and
needs in El Salvador, Guatemala, Honduras, and Costa
Rica.
- Continuing fragile domestic political situations in El Salva-
dor and Guatemala.
- A probable increase in direct violence against US and
moderate Central American individuals and interests.
? Cuba, Nicaragua, and the Salvadoran guerrillas-as well as
Mexico and certain leftist political groups in Latin America and
Europe-will continue to float negotiation schemes from time to
Scope Note: This Estimate focuses on issues of key importance to the United States concerning El Sal-
vador, Guatemala, Honduras, Costa Rica, and Nicaragua. The period of the Estimate is through 1982.
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time. As before, from the viewpoint of Cuba, Nicaragua, and the
Salvadoran guerrillas, these will be largely for tactical political
use.
? The circumstances of the Falklands war will doubtless reduce the
readiness of some Latin American states to support US initiatives
concerning Central America. The direct adverse impact in
Central America, however, is not likely to be substantial.
? The future holds many continued severe threats to US interests in
Central America. These countries will have great difficulty
maintaining their stability and independence in the absence of
strong external support.
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KEY JUDGMENTS
The threat posed by Communist-supported insurgency remains
serious but the momentum of the extreme leftist groups in Central
America has slowed, at least temporarily. A number of developments
during recent months have for the moment strengthened moderate and
democratic groups in the region:
? Fair elections have conferred power on new governments in
Honduras, Costa Rica, and El Salvador, while Guatemala has
moderate leadership; all four governments now have stronger
support than their predecessors.
? Guerrilla forces in El Salvador and Guatemala failed to stop or
disrupt the elections through violence and terrorism. In El
Salvador such forces were repudiated by the people.
? Improved intelligence and military operations by the Salvadoran
armed forces
demonstrate that-thee
guerrillas can be put on the defensive and contained.
? Factional rivalries have contributed to reducing somewhat the
effectiveness of the guerrillas in Guatemala and El Salvador,
despite Cuba's efforts to mediate these internal disputes.
? The previous assumption among many outside observers-Social-
ist International members and others-that victory for the
extreme left in Central America was inevitable is no longer so
firmly held.
? The growth of the exile anti-Sandinista movement and the
increase in defections from Nicaragua point to problems for that
country's Marxist-Leninist regime.
Despite these positive events of late, the dominant aspect of
Central America's future will remain the weaknesses of moderate
societies there, and the continuing efforts of Cuba, Nicaragua, and their
allies to promote Marxist revolutions in the area.
Accordingly, the principal threats to US interests will be posed by
these situations:
? Nicaragua will continue to build the most powerful armed force
in the region and will have help from some 2,000 Cuban security
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advisers. This military force will continue to be used to maintain
internal control, to intimidate neighbors such as Costa Rica and
Honduras, and to build toward a dominant military position in
the area.
? Soviet arms shipments to Cuba, already running at a higher level
than at any time since the 1962 missile crisis, will probably
remain substantial. These will continue to include new and
sophisticated weapons which will free older Cuban weapons for
transshipment to Nicaragua.
? Cuba and Nicaragua will continue to support the guerrillas in
Guatemala and El Salvador while working to build up the
extreme left in Honduras and Costa Rica. At the same time Cuba
and Nicaragua will continue their covert efforts to divide and
intimidate the governments of Honduras, Costa Rica, and El
Salvador.
? For tactical reasons, Cuba and the extreme left may step up
attempts to explore "political solutions" in order to reduce the
level of counterinsurgency efforts by El Salvador, while they use
the next months to regroup, rearm, and mold additional unity
among the guerrillas.
? The danger of assassinations of US officials and moderate Central
American leaders is likely to increase as the extremist leftist
groups seek dramatic ways to seize the initiative.
? Honduras will increasingly become a key target of Cuban and
Nicaraguan subversion. Castro and the Sandinistas will almost
certainly use a variety of methods-subversion, intimidation,
"peace" initiatives, propaganda, etc.-to try to force the Suazo
government to reduce its strong pro-US stance in the region. We
believe that such efforts will succeed in the absence of strong
external support. Yet, in the event their efforts should fail, Cuba
and Nicaragua might then adopt more militant policies against
Honduras:
- They might well attempt to establish an ostensibly home-
grown Honduran guerrilla group in a remote area. In such
a case, Nicaraguans and other foreign extremists would
probably participate.
- And in the event anti-Sandinista exile groups continue to
mount operations into Nicaragua, units of Managua's
ground and air forces may launch reprisals against exile
bases in Honduras.
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? A number of outside entities-including the USSR, Libya, Pales-
tinian terrorist groups,' and various leftist organizations-will
continue to lend a broad array of support to Marxist revolution-
ary movements in Central America. Such support will continue
to include training and arming of some guerrillas.
? Cuba, Nicaragua, and their allies will also continue to augment
their subversive efforts with initiatives for "negotiations and
peace." These will be designed to attract non-Communist sup-
port for the extreme left, reduce foreign support for the target
governments, divide the target governments, and complicate
relations between the United States and its allies. We consider it
highly unlikely that Cuba and Nicaragua will negotiate in good
faith during the period of this Estimate.
? Meanwhile, the political situation in El Salvador will remain
fragile, its new leaders continuing to have trouble achieving
consensus in the country on national priorities, the reforms, and
the apportionment of power, with the armed forces leadership
seeking to keep repressive forces in check.
? The new government in Guatemala will remain vulnerable to
overthrow, through a combination of possible plotting on the part
of disgruntled military officers and missteps on the part of
Guatemala's very unpredictable new leader, General Rios Montt.
International recognition through tangible support of the positive
changes in Guatemala would strengthen moderate forces.
? Severely depressed economies in El Salvador, Guatemala, Hon-
duras, and Costa Rica will constitute certain of the most critical
challenges to moderate, constructive advance. The slump in
world prices for these countries' agricultural exports is expected
to persist, thereby maintaining pressure on already scarce foreign
exchange reserves. Violence and guerrilla activity will continue
to harm production, erode investor confidence, limit the accumu-
lation of capital, feed inflation, and contribute to already high
levels of unemployment. Furthermore, needed austerity meas-
ures will be highly unpopular and likely to contribute to
additional unrest. These economies will continue to be dependent
in important measure on strong external support.
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For the longer run, beyond the period of this Estimate, the future
holds many severe threats to US interests in Central America. The many
weaknesses there will grow in the absence of continuing strong interna-
tional support, and there is no guarantee that even such support will en-
able moderate forces there to carry the day. Events have demonstrated,
however, that there is no inexorable downward path ahead.
? The Marxist revolutionaries and their various backers are beset
with numerous weaknesses and constraints.
? There is considerable political vitality in the area-demonstrated
especially by the courageous election turnout in El Salvador.
? Judicious infusions of military and other aid have helped in
certain given instances.
? Important support for moderate forces and the target govern-
ments has come from Venezuela, Colombia, and other friendly
governments, as well as from the Christian Democrats of Europe
and Latin America along with the international free trade union
movements.
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DISCUSSION
Regional Overview
1. US interests and allies in Central America will
continue to be threatened by subversion and destabi-
lizing forces through the remainder of 1982-the
period covered by this Estimate. Cuba and Nicaragua
will use extreme leftist groups and subversive violence
in pursuit of their objectives in El Salvador, Guate-
mala, Honduras, and Costa Rica.' At the same time,
however, there have been important favorable trends.
2. Opportunities and support for Marxist-Leninist
groups and radical causes have diminished in recent
months, while moderate and democratic forces have
been strengthened. New governments-three of them
headed by civilians-have come to power this year in
the four target countries, while guerrilla and extremist
groups have suffered significant setbacks. Insurgents
failed to disrupt the elections last March in El Salvador
and Guatemala, despite their plans to foment wide-
spread violence. Despite Cuban mediation efforts,
rivalries and tactical differences among the Marxist-
Leninist groups in both countries remain unresolved,
and this somewhat reduces their effectiveness. Inter-
diction has complicated Cuba and Nicaragua's task of
supplying the guerrillas, though it probably has not yet
reduced the net flow of materiel. Recently, after at
least four years of sustained and substantial growth,
the guerrillas have apparently begun to experience
difficulty in recruiting new members-causing some
resort to kidnaping by the Salvadoran guerrillas.
3. The most dramatic improvements have occurred
in El Salvador, where the guerrillas appear demoral-
ized and divided following steady military pressure
and the failure to disrupt the 28 March election.
Though the guerrillas threatened to disrupt the con-
stituent assembly elections and to discredit them be-
fore a large international audience-whose interest in
El Salvador they had done much to attract-voters
unmistakably repudiated the extreme left in over-
E See the annex, "Country Outlooks," for discussions of internal
conditions and prospects for these four Central American countries
and Nicaragua.
whelming numbers. About 1.5 million people-per-
haps 85 percent of the eligible voters-braved guer-
rilla intimidation and violence in generally fraud-free
elections. Though that extraordinary demonstration of
popular will to restore order did not end the country's
political divisions, it highlighted the resiliency and
resourcefulness of the Salvadoran people.
4. Despite these and other positive trends, the
threat from the extreme left remains serious and will
grow as Cuba and Nicaragua use the next months to
continue to arm, rebuild, and improve the guerrilla
forces in El Salvador and Guatemala. At the same
time, Cuba and Nicaragua are attempting to intimi-
date Honduras and Costa Rica into neutrality or tacit
cooperation while also working with the Soviet Bloc in
a worldwide propaganda campaign to fragment the
target governments, isolate them from outside help,
and raise questions about the dependability of the US
commitment.
5. In the next months, we expect Cuba and Nicara-
gua to continue supporting the extreme leftist groups
while repeating their tactics after the failure of the
"final offensive" of January 1981 in El Salvador-
using offers of negotiations to make political gains and
reducing the level of counterinsurgency pressure while
the guerrillas strive to strengthen their military and
political organizations.
6. Cuba and Nicaragua are using the Falklands
crisis as a device to stir up anti-US sentiment in Latin
America and to divide the United States from the
majority of Latin American countries (such as Vene-
zuela) that have been taking a firm anti-Communist
stand in the Central American region.
7. The reconstruction of severely depressed and
shattered economies will be among the most critical
challenges facing the new governments. The econo-
mies of all four target countries are highly dependent
on the sale of agricultural commodities and have
suffered as prices for cotton, sugar, and coffee have
declined. Also, violence and guerrilla warfare over the
last four years have undermined agriculture and tour-
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ism, eroded investor confidence, caused a sustained
flight of capital, and contributed to growing inflation,
which ranged from 10 to 65 percent in the countries of
the region last year. Unemployment has reached high
rates, from 14 percent in Costa Rica to an estimated 35
percent in El Salvador. Growth rates have ranged
from minus 10 percent in El Salvador to 1 percent in
Guatemala. Needed austerity measures will be highly
unpopular and will be likely to contribute to addi-
tional unrest. Even with some recovery in the world
economy, markets are likely to remain soft for the
region's principal exports, keeping the balance of
payments under severe pressure. The extent to which
imports can be maintained at tolerable levels will
depend heavily on economic assistance from the
United States, other bilateral providers, and the re-
gional and global international financial institutions.
The Threat From Cuban and Nicaraguan
Subversion
8. The guerrilla warfare and subversion encouraged
and supported by Cuba, Nicaragua, and the Soviet
Union will continue to deepen the social and economic
problems which also contribute to the political insta-
bility in the region. Realizing that the momentum of
the extreme left has slowed in recent months, Castro
may well decide to make greater efforts to strengthen
the guerrillas. He is likely to step up Cuban covert
action, propaganda, and threats against the moderate,
pro-US governments in the region, especially Hondu-
ras. Sandinista leaders, who have described the Salva-
doran insurgents as "our shield," will also persist in
their support of the Salvadoran insurgents, whose
survival they link closely to their own. Guerrillas in
Guatemala and small extremist groups in Honduras
and Costa Rica will also continue to be given tangible
help by Havana and Managua to improve their capa-
bilities for violence. In those three countries, as in El
Salvador, the strategy of the Cubans and the Sandinis-
tas 8 is aimed at enhancing their own power by
undermining US and moderate interests and eventu-
ally at creating new Marxist-Leninist regimes.
Support for the Salvadoran Guerrillas
9. Though demoralized and weaker relative to the
expanding military, the five insurgent groups in El
Salvador retain strong capabilities and continue to be
sustained via supply lines from Cuba and Nicaragua.
(See map of arms routes.) The number of direct flights
between Havana and Managua by Cuban aircraft
increased significantly ear
many carry 25X1
arms and ammunition. During the spring of 1982, at
least 180 tons of military equipment reportedly were
to have been airlifted to Managua, probably for
transshipment to the Salvadoran insurgents. The latter
are likely to receive additional automatic rifles and
heavier antiaircraft weapons. Should they succeed in
obtaining surface-to-air missiles, this would severely
reduce Salvadoran military capabilities.
10. Though the bulk of materiel sent to the Salva-
doran insugents is probably getting through, increased
arms interdiction efforts by the Honduran security
forces and the Salvadoran Navy have caused the
insurgents to shift their supply routes. Some arms
continue to be delivered overland through Honduras
and across the Gulf of Fonseca, but since last year the
guerrillas have sought to avoid detection by giving
greater priority to air and deep sea links.
11. Salvadoran guerrilla forces are not likely to
grow very much this year, and may be able only to
maintain estimated current levels of 4,000 to 5,000. To
do so, however, it may be necessary for them to draw
upon the approximately 5,000 to 10,000 part-time
members of the guerrilla militia. In addition, the
guerrillas are resorting to kidnaping to maintain mili-
tia force levels. Cuba and Nicaragua continue to
provide training for Salvadoran guerrillas, and there is
a good chance that advisers from those countries
operate intermittently with local guerrillas. The insur-
gents have divided the country into five fronts, each
with a commander and general staff. Guerrilla units
are mostly concentrated in base areas from 25X1
which operations are launc a More t an 50 guerrilla
camps have been identified in these base areas, and
there may be many more. The guerrillas' general
headquarters-the Unified Revolutionary Direc-
torate-is located in Nicaragua]
Support for the Guatemalan Guerrillas
12. With increased Cuban and some Sandinista
support, the guerrillas in Guatemala have been able to
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mount larger and more sophisticated operations over
the past year. From a force of about 1,000 in 1979,
insurgent groups have grown to an estimated 3,000 to
4,000. The guerrillas concentrate on small-scale oper-
ations, such as terrorist killings and bombings, eco-
nomic sabotage, and ambushes of security forces.
Their expanding military powers have also enabled
them temporarily to occupy important provincial
towns, and for the first time a guerrilla unit recently
was able to overrun a military garrison located in an
area of the Western Highlands where the guerrillas are
strongest. Generally, however, the guerrillas have rec-
ognized that they are not ready for decisive confronta-
tion and have avoided pitched battles with the mili-
tary, even on occasions when retreat has forced them
to abandon significant caches of weapons.
13. Cuban training and advice have been important
factors in the rising competence of the guerrillas. Over
the last several years hundreds have received guerrilla
instruction in Cuba,
A sma num er
of Cuban and Nicaraguan advisers may also be provid-
ing instruction at isolated guerrilla encampments in
Guatemala. Arms deliveries-via Honduras, Mexico,
Belize, and possibly Costa Rica-are becoming more
frequent-and the methods of concealment more so-
phisticated. Cuban assistance probably has helped the
guerrillas significantly to improve their external sup-
port network and to establish extensive arms caches
and underground tunneling in rural base areas. In
some isolated places where government presence has
always been tenuous, the insurgents are exercising de
facto control over the population.
14. Castro has also continued his efforts to forge
greater unity among the guerrilla factions. Though
Havana was able to persuade the four active insurgent
groups to form a new umbrella organization last
January, collaboration is still undermined by strong
rivalries and distrust. Factionalism was apparently
responsible in part for the guerrillas' failure to follow
through on their plans to disrupt the elections on 7
March. The largest and most effective of the groups-
the "Guerrilla Army of the Poor'
~-is, however, firmly committed to the
military struggle and generally responsive to Cuban
counsel. In contrast, the "Organization of the People
in Arms''-the second largest group and most ideologi-
cally diverse-has been resistant to Cuban manage-
ment. Its maverick leader refused to attend a unifica-
tion meeting in Havana, and some members reported-
ly favor trying to negotiate with the Rios Montt
government. Pressures from Cuba and the USSR have
persuaded the traditionally orthodox faction of the
Guatemalan Communist Party to make preparations
for joining in the insurgency.
15. Because of its strategic location in the region
and its strong support for US initiatives, Honduras is
likely to come under steadily rising Cuban and Nicara-
guan pressure this year. Castro understands that condi-
tions in Honduras are not as conducive to the growth
of insurgent groups and sentiment as they have been
elsewhere in Central America, but has placed a high
priority on stimulating violence there anyway. The
extreme left in Honduras is small and divided, and
Cuban efforts to coax its components into an effective
united front thus far have failed. Acts of terrorism
have increased, however, and some of them reportedly
have been directly supported by Nicaragua. Castro has
stepped up training of Honduran extremists.
16. Cuban and Nicaraguan concerns about Hon-
duras's role as a base of US and anti-Sandinista
influence are likely to mount this year, and cause
Havana and Managua to take stronger measures to
force the Suazo government to adopt more neutral
regional policies. They are likely to employ a variety
of methods-propaganda, intimidation, and terrorism,
as well as the current "peace discussions" between
Honduran and Nicaraguan military leaders-in a co-
ordinated campaign. Both Havana and Managua are
likely to press new efforts to subvert Honduran mili-
tary leaders and to sow divisions among them. The
Cubans received a setback, however, when the two
senior colonels with whom they maintained official
contact were removed in April as a result of an
internal power struggle. Other Honduran officers and
civilian leaders are undoubtedly also targets of Cuban
operatives in Honduras.
The Threat to Costa Rica
17. Although Costa Rica is much more vulnerable
to terrorist rather than insurgent activity at this time,
Cuba and Nicaragua are likely to attempt to build for
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the future by increased efforts at unifying the dispar-
ate elements of the Costa Rican Communist coalition.
This will require resolving tactical as well as ideologi-
cal divisions between the generally nonviolent policies
of the Costa Rican Communist Party and the small,
extreme leftist Popular Revolutionary Movement,
which has consistently advocated violence. Despite
their differences, both groupings reportedly have
small paramilitary capabilities that could, over time,
be exploited by Havana and Managua. Ironically,
potential Cuban and Nicaraguan efforts at building
unity may already have been assisted by the coalition's
electoral defeat in the February election, an outcome
that probably has strengthened the position of its more
hardline elements.
18. Both Cuba and Nicaragua recognize that Costa
Rica remains overwhelmingly democratic, as empha-
sized by the recent election, in which the country's
small Communist coalition saw its percentage of the
popular vote decline to 6.4 percent from 7.3 percent in
1978. Castro and the Sandinistas are concerned over
the Monge administration's willingness to counter
Communist propaganda in regional and international
forums, its avowedly pro-US posture, and its threat to
invoke the Rio Treaty to defend Costa Rica's borders.
As a result, they are likely to attempt to use their small
but reliable core of political friends in the country, as
well as Costa Rica's severe economic problems, to keep
pressure on President Monge and blunt potential
damage to their cause from San Jose.
19. Over the period of this Estimate, one likely
Cuban-Nicaraguan thrust would be through the Com-
munist Party, which has extensive ties with labor.
There is, therefore, a strong possibility that Havana
and Managua will attempt to push the party toward
destabilizing actions against the economy, including
work stoppages and violent strikes. Such actions ap-
pear all the more likely because of Monge's recently
announced austerity measures, which are sure to be
particularly unpalatable to organized labor. Further-
more-and despite San Jose's termination of consular
ties last year-Castro's operatives have the necessary
infrastructure to continue and to expand clandestine
operations in Costa Rica which, at the least, could
increase national anxieties over perceived threats to
the country's democratic institutions. During the past
year, such threats have repeatedly been underscored
by increased terrorism in San Jose, some of which has
involved participation by pro- and anti-Sandinista
Nicaraguans and individuals from other Latin Ameri-
can extreme leftist groups.
rospec s tor banclinista Ku le in Nicaragua
21. Castro's determination to help the Sandinista
leaders strengthen and further consolidate their rule
will continue as his highest regional priority. With
Soviet, Cuban, and other assistance, Nicaragua con-
tinues to build an army and militia force that is
intended to defend against any perceived regional
military threat. Managua already outstrips each of its
neighbors in military manpower, armor, and artillery
capabilities, and could probably beat back an attack
by any of them. Over the remainder of the year,
moreover, Nicaragua will widen its margin and may
receive enough MIG or other jet fighter aircraft to at
least match Honduras's air force-currently small and
aged, but the best in the region.
22. This determined militarization is intended not
only to establish strategic superiority in the region, but
to construct a large and impregnable base of domestic
control. Although there is a paucity of information
about the morale and effectiveness of the Nicaraguan
military, we know that the Sandinistas have worked
hard to indoctrinate and discipline their armed forces.
As in Cuba after the 1959 revolution, the new military
has been constructed around a loyal core of veterans of
the guerrilla struggle who occupy all high-level com-
mand positions. Recruits and volunteers from the
lower classes, whose standard of living, sense of pur-
pose, and nationalism may have increased since they
put on uniforms, probably respond favorably to the
regime's constant propaganda about the need to build
strong defenses and vigilance against foreign foes.
After nearly three years of such efforts, the Sandi-
nistas, we believe, have succeeded in creating a mili-
tary organization capable of and dedicated to main-
taining them in power.
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23. The Sandinistas have also emulated the Cuban
system by building an efficient security force and
party-controlled mass organizations. Sandinista De-
fense Committees are being expanded at the commu-
nity level throughout the country both to provide the
regime with networks of loyal informants and to
enhance its influence by attempting to dispense low-
level social services. Recruitment drives for the militia
have been accelerated, but harsh induction methods
have alienated many peasants. Through a combination
of pressure and patriotic appeals, the Sandinistas have
succeeded in increasing discipline in the labor force, a
major change in the wake of strikes, absenteeism, and
work stoppages that were common last year. The
Sandinista-controlled labor confederation-with about
125,000 members-is one of the largest of the mass
organizations, and it is steadily gaining ground over
the independent unions, which still number 35,000 to
40,000. Efforts by the government further to strength-
en and indoctrinate "revolutionary" mass organiza-
tions are likely to be intensified this year. New
measures to achieve its Marxist-Leninist goals may be
announced on 19 July, the third anniversary of the
Sandinista victory.
24. Since the state of emergency was imposed in
March, the regime has significantly accelerated its
disguised repression of democratic opposition groups.
Prior censorship is now required, and editors of the
prestigious independent newspaper La Prensa have
been so intimidated that they often now voluntarily
refrain from composing stories likely to anger the
regime. Several leaders of opposition parties and the
independent unions have been arrested on unspecified
security grounds, and a number of others have left the
country. Businessmen have come under tighter disci-
pline through a series of economic decrees that allow
the Sandinistas to control commerce and impose arbi-
trary "war taxes." Relations between the Sandinistas
and Catholic Church leaders have also deteriorated
over the last few months as the bishops have continued
to criticize the regime's authoritarian methods. A
Church radio station was recently closed temporarily,
and the government is also moving to gain more
control over the curriculum in the country's large
Catholic school system. Efforts to discredit the highly
popular Archbishop of Managua, by linking him to the
United States and exiled opposition groups, are likely
to be stepped up. Harsh repression of Indians contin-
ues following forced removal of thousands from their
home towns and their transport to detention camps.
While many democratic opposition leaders remain, a
number have left Nicaragua, and some of these have
joined various anti-Sandinista groups in exile. Under
present conditions, we believe that internal opposition
groups are so weak and demoralized that they will be
able to do little more than irritate the regime, and will
probably continue to lose strength through the year.
25. Despite a history of factionalism that dates to
the mid-1970s, the Sandinista leaders have displayed
remarkable unity since coming to power. To a large
extent this reflects the commonality of the Marxist-
Leninist views among the nine members of the Na-
tional Directorate, and probably also the unifying
counsel of their Cuban advisers. Disagreements over
tactics and personality conflicts among some of the
leaders make a leadership shakeup inevitable in the
long run, however. Those most likely to prevail-
Humberto Ortega (who controls the armed forces), his
brother Daniel (who is the junta coordinator), Tomas
Borge (who runs the internal security and foreign
intelligence services), Bayardo Arce (a major foreign
policy and political coordinator), and Henry Ruiz (who
oversees economic planning)-are also believed to be
the most radical and attuned to Cuban approaches.
They are likely, moreover, to react to future domestic
and foreign challenges the way Castro did during the
early years of his revolution, by using each perceived
crisis as an opportunity further to radicalize and
consolidate power. Cohesion among them and other
Sandinista leaders will be reinforced, especially in the
short term, by their probable agreement that the
United States is intent on destroying their revolution
and the recognition that their most critical current
vulnerabilities are the floundering economy and the
increasingly effective raids by anti-Sandinista exiles.
Trends in the Target Countries
26. The prospects appear relatively favorable that
El Salvador's provisional government will be able to
build upon the strong mandate of the 28 March
constituent assembly elections and move the country
toward a national election in late 1983 or early 1984.
Although the government will continually reflect the
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fragility of El Salvador's rigid political system, on
balance we judge that its more moderate and prag-
matic elements are likely to gain greater influence
during the period of this Estimate. The position of
these elements will, as necessary, be reinforced by the
military, which emerged as the major force for moder-
ation during the month of political infighting that
followed the election. During that time the armed
forces repeatedly showed that, unlike the major con-
testing parties, they had not forgotten who the real
enemy is and that they remain aware that national
survival depends on maintaining foreign economic and
military assistance.
27. On the military front, moreover, the relative
balance of strength between the armed forces and the
guerrillas appears to be shifting gradually. The insur-
gents, who in the months before the elections were
able to project an image of growing might and to
benefit from increasing international sympathy, have,
at least temporarily, lost those psychological advan-
tages. As the guerrillas' confidence has seemed to
diminish, Salvadoran military leaders have continued
to improve their counterinsurgency capabilities and
prospects. About 500 junior officer candidates recently
returned to El Salvador after receiving training in the
United States, and will substantially increase the size
of the officer corps. The military has also been
augmented by the return of a US-trained quick-
reaction battalion, by the acquisition of new equip-
ment, and by the continuing expansion of the armed
and security forces from 17,000 at the beginning of
1981 to 28,500 in May 1982. There is, however, a
potential problem of ammunition and equipment
shortages if El Salvador fails to receive its anticipated
level of foreign military aid in the next few months.
28. Nonetheless, serious political problems continue
to threaten the stability of the new government and its
international legitimacy. Currently, there appears to
be a return to the preelection political violence by
both extremes, underscored by the recent murders of
some Christian Democratic officials and peasants by
rightwing extremists. Moreover, at least 3,000 peasant
beneficiaries of the land reform have been evicted
illegally by landowners. The assembly's postponement
of further distribution of rented land to peasants has
exacerbated divisions among the parties and provoked
new problems with the military, which is determined
to maintain the land reform. It has also brought
renewed criticism from friendly democratic govern-
ments. Roberto D'Aubuisson's election as assembly
president and his continuing efforts to undermine
reforms and the Christian Democratic Party are de-
tracting from the positive results of the elections. The
insensitivity of some rightwing leaders to the impor-
tance of international opinion, particularly in the
United States, is likely to continue as a major problem
because of the urgent need for external aid.
29. The Guatemalan Government's hold on power
is the most uncertain in Central America, but we
believe there is a slightly better than even chance that
General Rios Montt will remain in power through the
year. While he does not have a political constituency
committed to his continuance in office, his policies
thus far have addressed the major concerns of the
military and the population. He retains tentative
support from the junior officers who carried out the
coup and placed him in power, as well as from key
military unit commanders. Among military leaders
there appears to be an awareness that another change
in government-particularly one involving violence
and a move to the right-would jeopardize growing
international recognition of Guatemala's reforms,
damage the military institution, and detract from their
primary task of defeating the insurgents. Rios Montt
also benefits from the fact that there are no obvious
candidates-from either the senior or the junior
ranks-who have the personal following to lead the
country.
30. The new government has taken a number of
steps aimed at reducing political polarization and the
high levels of violence that have prevailed for many
years. Rios Montt has given a high priority to eliminat-
ing government corruption and human rights abuses,
and to planning social and economic reforms aimed at
improving the lot of the Indians and peasants, who,
over the last few years, have been more attracted than
ever before to radical causes. The regime has arrested
former officials, has disbanded semiofficial rightwing
terrorist groups, and is attempting to formulate civic
action programs in the contested Indian areas. The
new approaches pursued since the coup last March
have already had some significant results, including a
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sharp decline in the number of political assassinations,
an apparent rise in popular support for the national
government, and a renewal of hope in the chances for
moderate solutions for Guatemala's serious problems.
31. Perhaps the crucial factor in Rios Montt's
chances of holding office is his own highly idiosyn
cratic leadership style. A born-again evangelical Chris-
tian in a conservative Catholic country, he has not
spared his audiences from rambling and righteous
sermons, moody attacks on powerful groups, and other
eccentric behavior. He has made clear, moreover, his
belief in the divine providence of his undertaking.
"Neither the voters nor bullets gave me this position,"
he said in a speech in April. "God placed me here."
32. There is, moreover, considerable dissension
among senior officers concerning Rios Montt's failure
to rein in junior officer advisers. His rebukes of the
officers' personal behavior are also antagonizing them.
Rios Montt's political longevity will probably depend
on his ameliorating the divisiveness within the military
and making progress in addressing the insurgency and
economic problems facing the country. At the mo-
ment, however, his personal traits and lack of an
organized and loyal constituency make him vulnerable
to coup plotters.
33. The government of Roberto Suazo Cordova is
providing Honduras with its most competent leader-
ship in years. The new administration's performance
during its four months in office is enabling it to build
on the general public support that greeted the coun-
try's first civilian government in a decade. The Presi-
dent's emphasis on honest and effective government
and fiscal responsibility has been popular, especially
since it contrasts with the corruption and ineptitude of
past years. By staffing government ministries with a
mixture of talented young people and seasoned techni-
cal specialists-predominantly from his own Liberal
Party-Suazo has upgraded the quality of gov-
ernment.
34. Suazo has also been effective in winning the
confidence of top military leaders, especially Com-
mander in Chief Alvarez. The two men share strong
anti-Communist sentiments, and the President has
gone out of his way to help Alvarez prevail over rivals
in the military and to defer to the newly promoted
general on military and security issues. The Honduran
Communist Party-probably the largest radical entity
in the country, with about 1,000 members and sympa-
thizers-has taken the lead in intensifying efforts to
establish the ground work for an armed insurgency. At
a meeting early this year, the party leader, who had
just returned from Havana and the USSR, reportedly
purged the party of its remaining "softliners" and won
an endorsement for a "prolonged popular war" stra-
tegy. The initial phase of that plan calls for increased
terrorist activity and an acceleration of paramilitary
training in Cuba. In response to these threats, the
Honduran security forces are beginning to improve
their counterinsurgency capabilities.
35. The Monge government will return Costa Rica
to policies more consistently in line with US interests
in Central America and less given to the fiscal and
political eccentricities that characterized the Carazo
administration. Nevertheless, Costa Rica faces unprec-
edented economic problems that will defy quick solu-
tions, the strong likelihood that leftist extremists will
attempt to exploit the economic situation, and the
probability that the woefully inadequate security
forces will be unable to stem the country's use as an
important link in regional arms supply. Additional
challenges involve an increasingly volatile situation
along the northwestern border with Nicaragua, as well
as the possibility of Cuban and Nicaraguan clandestine
operations calculated to destabilize the Monge govern-
ment. Although its strong democratic institutions
should enable Costa Rica to withstand these chal-
lenges, the tranquillity that has previously distin-
guished the country from much of the rest of Central
America will be less pronounced in the future.
The International Arena and the Diplomatic Front
36. During the last four years a variety of other
international forces have become actively involved for
and against the extreme left in Central America.
Various types and degrees of political, diplomatic,
communications, financial, and moral support have
been given to the guerrillas or their political fronts by
Mexico, the Socialist International, many social demo-
cratic parties in Latin America and Europe, and a
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number of European government officials. Libya,
along with the PLO and various other Palestinian
terrorist organizations, has also provided guerrilla
training and weapons. Since July 1979, Nicaragua has
received $400 million from Western industrialized
countries, $300 million from Mexico, and $100 million
from Libya.
38. In contrast, the Christian Democratic parties
and international free trade unions of Europe and
Latin America oppose the extreme left and support
moderate forces in Central America. Also, Venezuela
and many Latin American states (excluding Cuba,
Nicaragua, and Grenada) have essentially supported
the moderate groups and condemned the extreme left
in regional forums such as the OAS. The Falklands
crisis may lead to some reduction of this support.
39. In this complex international arena, where po-
litical symbolism has a large role, Cuba, Nicara-
gua,and the Salvadoran guerrilla directorate have used
negotiations and "peace initiatives" since 1979 in
tandem with their subversive activities in Central
America. Their recent negotiating initiatives were
based in part on the proposals made by Mexican
President Lopez Portillo in Managua last February,
and have been directed at three "areas of tension" in
the Caribbean Basin: (1) US-Cuban relations, (2) Nica-
ragua's relations with its neighbors and with the
United States, and (3) the internal conflict in El
Salvador. Lopez Portillo proposed that negotiations
begin among the parties in all three areas, and hinted
that Mexico could play a helpful role in facilitating
contacts. Seeking to exploit the propaganda advantages
presented by the Mexican proposal-about which
Cuban officials were reportedly informed in ad-
vance-Castro, the Sandinistas, and the Salvadoran
guerrilla groups have all declared their support for the
Mexican plan, as did Moscow.
40. Cuban propaganda is likely to continue stressing
Castro's willingness to "talk, discuss, or negotiate"
bilateral and regional problems. This, and accompany-
ing diplomatic initiatives, are intended to establish a
record of Cuban reasonableness and flexibility in the
face of US "imperialism" and "intransigence." Cas-
tro's efforts are likely to meet with some success,
moreover, especially with the nonaligned countries
and also with certain West European audiences.
41. One of Castro's objectives in stressing his inter-
est in "negotiations" is to increase the pressure-
internationally and in the United States-on US
policymakers and to make it more difficult for them to
pursue policies aimed at constraining him. Castro has
done this repeatedly in the past, while never consider-
ing concessions of any significance, especially in re-
gard to his commitment to revolutionary causes
around the world. As occurred recently, Castro can
also be expected to use any high-level meetings with
US officials to his own advantage, for propaganda
purposes and for spreading doubts about US resolve
and reliability as an ally.
42. Cuba, Nicaragua, and the Salvadoran guerrillas
also use negotiations:
- To attract and hold non-Communist support for
the extreme left, such as that from Mexico and
many social democratic parties; this support
helps to confuse observers about the real nature
of the guerrilla movements; it acts to attract
needed financial resources, and it offers political
leverage against the continuation of foreign aid
to the target governments.
- To reduce foreign support for the target govern-
ments by creating the impression of near-total
international isolation and therefore hopelessness.
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- To create or aggravate divisions within the gov-
erning coalitions in each target country and sow
distrust between those governments and the
United States.
Outlook: Continuing Threats in the Region
43. Though a number of developments have
strengthened US interests and allies, and undermined
Marxist-Leninist causes in Central America, the threat
of major reverses remains. A significant-and grow-
ing-threat is in Honduras, which recently has be-
come a key target of Cuban and Nicaraguan subver-
sion. The Sandinistas and Cubans are working to
coerce Honduras away from its support of US policies.
They are now concentrating on covert actions, terror-
ism, propaganda, diplomatic initiatives, and intimida-
tion. Sandinista leaders probably have attempted to
heighten Honduran fears of Nicaraguan military re-
taliations and of wider conflict by reminding them of
the secret defense pact that links them with Cuba.
They undoubtedly have also been warning their neigh-
bors that they cannot depend on military backing
from the United States or the peacekeeping mecha-
nisms of the. OAS. US policy in support of the United
Kingdom in the Falklands war has added to the
concerns of Honduran leaders-especially General
Alvarez-about the reliability of their alliance with
the United States. We believe, however, that as long as
the Suazo government is reassured by strong US
support, such Cuban and Nicaraguan intimidation will
fail.
44. The threat of Nicaraguan retaliations against
the Suazo government will increase, especially with
any expansion of anti-Sandinista exile operations from
Honduras. Nicaraguan fears have steadily risen as
exile raids have taken a larger toll. One Nicaraguan
official reportedly claimed that Managua's forces have
suffered some 300 casualties in recent months. If such
trends continue, we believe the Sandinistas-coordi-
nating their policies closely with Havana-are likely to
resort to more aggressive policies before the end of the
year.
45. There might be a good chance that Cuba and
Nicaragua would attempt to establish guerrilla groups
in remote areas of Honduras. In the absence of
sufficient trained Honduran guerrillas, Nicaraguans
and former guerrillas from other Latin American
countries who fought with the Sandinistas in 1979
might be clandestinely included in an ostensibly
homegrown Honduran insurgent force. With suffi-
cient external support, such an insurgent force could
possibly survive in Honduras.
46. There is also a good chance that Nicaragua will
take limited direct armed actions against anti-Sandi-
nista camps in Honduras to retaliate against raids
launched from across the border. If they were to take
such military steps, the Sandinistas-and Castro-
would probably reason that they could get away with
them-in international opinion at least. They would
probably endeavor to camouflage or justify such ac-
tions in a concerted diplomatic and propaganda cam-
paign emphasizing their desire to "negotiate" regional
problems while portraying Nicaragua as an innocent
victim of US "imperialism."
47. They would probably hope that pressure would
quickly build for a negotiated settlement between
Honduras and Nicaragua that would include some
kind of guarantees from cross-border raids. Mexico,
certain West European governments, and most of the
Socialist International and others would probably
again support this Cuban/Nicaraguan position in the
interests of a "political solution."
48. In El Salvador the collapse of the fragile coali-
tion of moderate forces would be a serious setback to
US interests and the gains achieved since the elections.
The interim government there will face many old and
new challenges over the next six months or so: the
insurgency; grave economic problems; the multiple
weaknesses of the ill-defined sharing of power among
parties and the military; continuing distrust among
key groups and leaders; and, perhaps most serious,
rightist efforts to reverse the land reform while the
guerrillas become more active and violence rises. In
addition, the high expectations and widespread sense
of relief among the populace that followed the elec-
tions will be in danger of dissolving if some tangible
progress is not achieved in the short term. Improve-
ments will be contingent, moreover, on the country's
continuing dependence on substantial foreign support.
Despite the dangers, we believe that if foreign aid
continues, the prospects are favorable that El Salva-
dor's provisional government will be able to build on
the strong electoral mandate, in partnership with a
military leadership which has demonstrated its com-
mitment to the reforms and fair elections, and to move
the country toward another vote next year.
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49. In Guatemala, major US interests are not likely
to be endangered this year, unless there is a reversal of
recent moderating trends. International recognition of
the positive steps taken by the Guatemalan Govern-
ment, through tangible support, will strengthen mod-
erate forces there. Rios Montt remains an enigma to
many domestic and foreign observers, and his support
in the military is tenuous. We judge nonetheless that
his government's chances of surviving through the
year are slightly better than even. Though we cannot
predict which of the many possible coalitions of forces
might unseat him, or who would rise to the top, a
successor government would in all likelihood be more
conservative. A reversion to the often violent and
archconservative policies of the military governments
that dominated the country from the late 1960s
through last March would work to the advantage of
the extreme left.
50. Other short-term threats to US interests and
allies in Central America will derive primarily from
the expected increase in Cuban and Nicaraguan sub-
versive efforts and acts of terrorism by radical groups.
The danger of assassinations of US officials in the area
and of Central American leaders is likely to increase
this year as guerrilla and extremist groups search for
dramatic ways to seize the initiative again. Honduran
leaders will probably be special targets of such plots,
though Rios Montt in Guatemala and leading Salva-
doran figures are also vulnerable to ample numbers of
enemies. Terrorists from outside of the region could
also pose an increased threat this year. Costa Rican
President Monge, for instance, who recently ordered
his country's Embassy in Israel moved to Jerusalem,
could be a target of PLO and other radical Arab
groups that for several years have had close ties with
Central American extremists.
51. US interests and regional allies may be con-
strained, moreover, by a variety of regional and global
factors that will probably tend to reduce, and in some
cases neutralize, further short-term gains in Central
America. As a result of the Falklands crisis, the United
States is likely to be much more on its own in Central
America. Venezuela will continue to support moderate
forces in Nicaragua and El Salvador but will want less
public identification with US activities there. Reduced
resources will substantially limit Argentina's role in
Central America, and bitterness toward the United
States could lead it to pursue policies there that
diverge from those of Washington. Anchored by their
own crises to close dependence on the United States,
the four target countries there have no reasonable
alternatives at least in the foreseeable future. Bilateral
relations would be subject to erosion, however, if US
resolve and reliability as a partner in internal security,
defense, and economic relations were seriously
questioned.
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