NATIONAL INTELLIGENCE DAILY (CABLE) 24 MAY 1982

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84T00301R000300010079-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 20, 2016
• Sequence Number: 79
• Content Type: REPORT

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EE~,F Director of Too Secret
~1 Central
Intelligence
National Intelligence Daily
(Cable)
Top Secret
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Top Secret
UK-Argentina: Fighting Quickens as Diplomacy Lags . . . . 1
Cuba: Shift in Agricultural Policy . . . . . . . . . . . 5
Japan: Diet Session Extended . . . . . . . . . . . . . . 6
Denmark: Government Faces Showdown. . . .
Special Analyses
UK-Argentina: Probable British Strategy . . . . . . . . . 8
South Africa - Namibia: Negotiating Options . . . . . . . 11
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UK-ARGENTINA: Fighting Quickens as Diplomacy Lags
//Weekend fighting in the Falklands was confined primarily to
the air, as the British continued consolidating their ground posi-
tions and Argentine logistic contraints and strategic concerns
limited the possibility of ground counterattacks.
There was ZittZe progress on the diplomatic front.//
//Since the invasion began, the British claim to have
destroyed 28 aircraft and probably downed five others
and to have put a Coast Guard vessel and a transport out
of commission. They acknowledged 48 dead, not counting
any losses in action yesterday. The UK admits one frigate
sunk, two others seriously damaged, and some damage to
several more, as well as a Harrier jet and two helicopters
lost. Buenos Aires claims to have downed another Harrier
and to have knocked out seven warships.//
Military Action
//Military action on Saturday was limited as Argentina
made only a two-plane airstrike against ships in the
San Carlos area and inflicted no damage. British Harriers
struck Darwin, wrecking an Argentine Coast Guard vessel;
Argentine forces claimed one Harrier was downed.//
The UK made further air attacks on Goose Green
yesterday and claimed to have shot down one helicopter
and damaged two others. Argentina followed up a morning
attack on San Carlos by two planes with a major air
assault in the afternoon. The British claim they shot
down six mirages and Skyhawks and probably destroyed
three more. The Argentines announced they seriously
damaged a transport, and London acknowledged damage to
a frigate as well.
Comment: //The Argentine Coast Guard vessel destroyed
Saturday was trying to reinforce the garrison in the
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Darwin/Goose Green area--the most likely next British
objective--just as the British are attempting to soften
up the outpost prior to an assault.//
//The Argentine return to large-scale air attacks
yesterday after the previous day's lull suggests they
needed time for extensive preparations before launching
further strikes. The Argentines have now lost about 50
aircraft during the crisis.//
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EC Foreign Ministers' Meeting
//EC foreign ministers, meeting in Brussels today and
tomorrow, face complicated issues concerning the Falklands
and internal Community disputes. Foreign Secretary Pym
will ask for a reaffirmation of EC solidarity with the UK
and may request another extension of sanctions against
Buenos Aires.//
Comment: //The British continue to view sanctions as
an important mark of European disapproval for the Argentine
invasion. Given the increase in fighting, domestic pres-
sure in several member states, and dissension over the Com-
munity's budget and farm price increases, the British are
probably not optimistic that they can obtain a comprehensive
renewal. Britain's European partners are likely at the
least to call for compliance with UN Security Council Reso-
lution 502, and for a cease-fire accompanied by Argentine
withdrawal.//
Other Diplomatic Activity
Galtieri also sent a message to Pope John Paul II
yesterday that Argentina was ready to accept a cease-fire
and negotiate. London will reply to the Vatican's peace
initiative today.
The UN Security Council debate continued yesterday,
but no resolutions were put forward. Argentine Foreign
Minister Costa Mendez denounced British "criminal aggres-
sion" and denied that Buenos Aires sought a cease-fire
from the Council.
Comment : //The British will veto any resolution that
does not call for immediate withdrawal of Argentine
forces.//
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CUBA: Shift in Agricultural Policy
Public dissatisfaction and economic woes apparently have Zed
President Castro to ease somewhat his efforts to curb private enter-
prise in agriculture.
In a speech last week before the National Association
of Private Farmers, Castro backed away from earlier
threats to close Cuba's free markets. He warned, however,
that prices could not fall as low as the consumer would
like without causing a decrease in agricultural production
that would divert farm products to the black market and
thus result in even higher prices.
Comment: Castro now evidently sees the markets--
which have played a key role in stimulating agricultural
production--as a necessary evil. His turnabout reflects
unusual sensitivity to public opinion and probably stems
partly from his concern that a "Polish" problem not
develop in Cuba. The President is likely to face pressure
both from government hardliners--who want to bring the
agricultural sector completely under state control--and
the technocrats, who advocate even more pragmatic economic
policies.
Restrictions which might eventually be imposed,
including price controls, taxes and closer government
supervision, probably would result in lower agricultural
production. Other steps that the regime is still planning
to take to regulate private farmers are likely to have
the same effect.
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Prime Minister Suzuki's efforts to strengthen his
political standing before the party presidential elections
this fall could delay action on some US-Japanese issues.
Suzuki agreed to extend the Diet session into August to
be able to push through a bill on election reform and
fulfill his pledge to promote clean politics. The ex-
tension, however, will also give the opposition opportuni-
ties to criticize the government on economic problems and
the Lockheed scandal.
Comment: Key members of the bureaucracy usually
remain in Tokyo to prepare responses to questions raised
in the Diet, which probably will necessitate reducing the
size and level of the Japanese delegation to the US for
security cooperation talks in mid-July. Japan may ask
for a postponement, particularly if progress on its own
defense plans remains stalled because of the longer Diet
session. The government also may postpone announcing
a policy on defense technology transfer to the US in
order to avoid open debate on that sensitive issue.
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Prime Minister Anker Jorgensen's minority Social
Democratic government could fall unless it finds new
parliamentary allies to support its economic recovery
program in the debate scheduled to begin today. The two
leftist parties that have backed the government have
added new conditions for their continued support of the
government's plan, prompting Jorgensen to seek support
from the parties of the center and right.
Comment: Denmark's NATO Allies would welcome a
Social Democratic decision to look toward center and
rightist parties rather than continue to cooperate with
leftist parties opposed to increased defense spending,
but Social Democratic leftwingers would be alienated.
With his own party in disarray over how to proceed,
Jorgensen may await the outcome of the first reading of
the proposed legislation today before making a final de-
cision on strategy. Although the fall of the government
would open the way for a nonsocialist alternative, the
opposition center and right parties are seriously divided
and would also lack an effective majority.
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UK-ARGENTINA: Probable British Strategy
//London is aiming at a rapid military victory in the Falklands,
and its forces are likely to spend only a short time consolidating
the beachhead. The British probably intend a direct assault against
Argentine forces at Stanley even though their forces are substantially
outnumbered. The government appears ready to accept relatively
heavy losses in exchange for quick military success. Prime Minister
Thatcher could call early elections in the event of success, but a
serious military setback or stalemate would probably result in her
replacement. //
//The British apparently envision a campaign lasting
less than two weeks. They probably expect to consolidate
their position at San Carlos in short order and are
likely to move against Darwin/Goose Green, less than 32
kilometers away, where there are 600 Argentine troops
and an airfield. Afterward they would move on Stanley,
about 80 kilometers to the east.//
//Darwin/Goose Green is important because it is
astride the only main route to Port Stanley, and because
a British victory there would provide continuing psycho-
logical momentum. The Argentine units there probably will
be unable to resist long the 5,000 to 6,000 troops of the
British land force.//
//While the main British force is moving toward Stanley,
small units probably will raid Argentine positions on both
East and West Falkland to destroy Argentine aircraft, ammu-
nition, and supplies. British ships and aircraft will
attack Stanley to pin down-the Argentine troops and soften
them up for an assault.//
//Difficult terrain and poor weather may slow the
British advance from Darwin/Goose Green to Stanley.
British forces on the move will be at high risk from
Argentine aircraft, and Harriers from the British air-
craft carriers or possibly from the field at San Carlos
will have to provide protection.//
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//The Argentines probably will place troops on the
high ground about 25 kilometers from Stanley--at
Mt. Challenger, for example--to obstruct the advance.
Argentine forces also could launch a counterattack from
Stanley in an attempt to deal with British units piece-
meal.//
//Although the 3,000 troops aboard the Queen Elizabeth
2 have been described as a garrison force, they could
become involved if the British troops become bogged down.
The forces on board, the Scots Guards and the Welsh Guards,
are among the best British units. These troops, which
could arrive as early as Wednesday, might be landed in
northern or north-central East Falkland to outflank Argen-
tine defenses.//
//Once they arrive in the Stanley area, the British
forces probably will initially establish defensive posi-
tions, but after a short period of artillery bombardment
joined by naval and air attacks, they probably will attempt
to storm the town spearheaded by Scorpion light tanks.
The British are better trained and somewhat better equipped
than the Argentines, and would be supported by air and sea.
The Argentines, however, outnumber the British two to one
and would be in prepared defensive positions.//
//The Argentines will attack British land and sea
forces during the campaign, using aircraft from the main-
land. The British aircraft carriers will continue to be
the most attractive target.//
//The British are unlikely to attack mainland bases.
They apparently can stage only a few Vulcan bombers from
Ascension Island to Argentina, and British carriers would
have to move dangerously close to Argentine defenses to
attack with Harriers.//
//As long as the British see negotiations proposals
as detrimental to their interests, a short campaign that
is proceeding successfully will receive broadbased support
in the UK. Backed by favorable public opinion, Thatcher's
government and an overwhelming majority of her party prob-
ably are willing to continue to accept relatively heavy
losses, but only if a clear-cut military victory is the
result.//
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//Within the Social Democratic - Liberal alliance and
even within the Labor Party--which is becoming increas-
ingly divided over how to resolve the crisis--a majority
will support such a campaign for now.
will give commanders on the scene considerable leeway
for the immediate future.//
//A short, successful campaign, especially with few
new losses, would catapult the Tories into a stronger
position than at any time since the early 1960s. Conse-
quently, despite disclaimers by the Conservative Party
chairman, chances would increase dramatically for an
election as early as late spring, with a major Tory
victory likely.//
//Nonetheless, Thatcher is following a high-risk
strategy. Loss of the Sheffield and casualties sustained
during and since the invasion sent shockwaves through
the UK, but they are "acceptable" because of the UK's
general military successes. Any serious reverses, how-
ever, almost certainly would force Thatcher to reconsider
an aggressive military course, and would increase pres-
sure for a cease-fire.//
//Heavy losses early in the campaign or a stalemate
on the ground could spur the UK to redouble its efforts
and even attempt a spectacular military reprisal. Within
a relatively short time, however, British reverses probably
would seriously erode Thatcher's position as Prime Minis-
ter and compel her to accept a cease-fire and UN mediation
while British forces struggled to hold their ground.//
//If Thatcher fell, she would be replaced by a Tory
less clearly locked into hardline military policies.
There has already been speculation that Foreign Secretary
Pym is uncomfortable with Thatcher's emphasis on a military
victory. It is unlikely, however, that a general election
would follow immediately.//
//Less dramatic setbacks probably would encourage the
military to request more time and the government to grant
it. Thatcher's position would not be greatly affected at
first, but the longer a military victory is denied, the
more constricted her maneuvering room would become.//
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Thatcher and her "war cabinet" likely
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SOUTH AFRICA - NAMIBIA: Negotiating Options
//South Africa recently has moved to increase the pace of the
negotiations for Namibia's independence by proposing an accelerated
timetable for a settlement. Although the new sense of urgency in
Pretoria may reflect growing political and economic pressure, South
Africa's shift also may stem from a belief that the time is now
ripe either to obtain an acceptable resolution of the Namibia ques-
tion or at least to gain stronger Western support for its position
if negotiations fail.//
//The pressures to dispose of Namibia are mounting
but are not yet sufficient to force Pretoria to accept
terms it finds unfavorable. Militarily, South Africa
has the capacity to remain in Namibia indefinitely, and
it is continuing to strengthen its forces in the terri-
tory.//
Debates in South Africa over Namibia remain low key,
but it is only a matter of time before rightwing parties
move to exploit the issue. The rightwingers are sure to
criticize the current negotiating effort and will contest
any settlement that appears to compromise the interests
of whites in Namibia or South Africa's security. Prime
Minister Botha's government, realizing that this opposi-
tion will attack its handling of Namibia regardless of
what it does, may calculate that a quick settlement would
enable it to minimize the political damage.
//South Africa believes that a major benefit of a
settlement, especially if coupled with progress on racial
reforms, would be closer association with the US. Pros-
pects for improved bilateral relations have already been
a major selling point for a settlement on Namibia.//
//Senior officials have complained about the in-
creased financial burden of maintaining control in Namibia.
Although South African businesses remain heavily involved
in Namibia, Pretoria claims--probably correctly--that it
spends over $1 billion a year to subsidize the Namibian
administration and to fight the insurgency waged by the
South-West Africa People's Organization.//
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Pretoria's turnabout also may reflect the failure
of the political parties in Namibia to use the time bought
by stringing out the talks to develop a strong anti-SWAPO
political structure. South Africa's chosen political.
vehicle, the Democratic Turnhalle Alliance, has been
undercut by white opposition and spurned by blacks.
The territory, meanwhile, remains divided among over
40 tribally based political groups. Moreover, South
African leaders probably realize that despite considerable
efforts the military has neither destroyed SWAPO's insur-
gency capability nor diminished its political support in
Namibia.
//Now that Pretoria has decided to speed up negotia-
tions, it will adjust its tactics with an eye to Western
attitudes. If the talks fail to produce an accord, for
example, South Africa will want to be seen as a flexible
negotiator blocked by Communist-inspired intransigence.
In the event of a breakdown in talks, the South Africans
will seek Western support or acquiescence for measures
they take against SWAPO.//
//If negotiations succeed, but involve potential risk
for South Africa's security, Pretoria probably will seek
Western understanding for security guarantees it will
demand in connection with a settlement. In particular,
it will want assurances against a Soviet or Cuban military
presence in an independent Namibia and will want to pro-
tect against use of Namibian territory by anti-South
African insurgents. Pretoria also will insist on a large
enough reduction in the number of Cuban troops in Angola
to allow the National Party government to claim a major
diplomatic victory to its constituents.//
Settlement Options
//The decision on negotiations has not narrowed South
Africa's range of options. Depending on the outcome of
bargaining on specific arrangements, Pretoria may make a
genuine effort to conclude a settlement.//
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//South African leaders are apparently prepared to
live with a black antiapartheid regime in Windhoek that
has cool relations with Pretoria. They may believe that
security guarantees coupled with direct economic and
military leverage will constrain the policies of any
Namibian government.//
//Pretoria also has the option of deferring hard
political decisions by not allowing the talks to reach
a conclusion, which has essentially been its policy since
the late 1970s. By following this approach, however,
South Africa risks being held responsible for the break-
down of negotiations and losing the chance for a rap-
prochement with the West.//
//In addition, South Africa retains the option of
declaring a unilateral settlement in Namibia that effec-
tively excludes SWAPO--something it threatened to do in
1978 and again hints it is contemplating. Pretoria may
hope that, after demonstrating a sincere effort to ne-
gotiate, the West will look more sympathetically on such
a move. An internal settlement, however, would not end
the SWAPO insurgency or reduce the financial burden of
Namibia.//
//Any option will be accompanied by a strong counter-
insurgency effort. Even if negotiations appear to be
succeeding, South Africa will keep military pressure on
Angola to thwart SWAPO attacks into Namibia. If nego-
tiations fail, major ground attacks and airstrikes deep
into Angola are likely.//
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