NATIONAL INTELLIGENCE DAILY MONDAY 24 JANUARY 1983

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T01094R000100010153-6
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: December 27, 2016
• Document Release Date: July 12, 2010
• Sequence Number: 153
• Publication Date: January 24, 1983
• Content Type: REPORT

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Director of
Central
Intelligence
National Intelligence Daily
Monday
24 January 1983
-se- ,
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Top Secret
Portugal: Eanes Plans Election . . . . . . . . . . . . . . 3
OPEC: Nearing Agreement on Quotas . . . . . . . . . . . . 6
Malaysia-Japan: Prime Minister's Visit . . . . . . . . . . 9
El Salvador: Politics in the Military . . . . . . . . . . 10
24 January 1983
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PORTUGAL: Eanes Plans Election
The early election called for by President Eanes will probably
produce a Socialist-led government.
President Eanes yesterday rejected the ruling
center-right Democratic Alliance coalition's nominee to
replace Prime Minister Balsemao, who had announced his
resignation on 19 December. Eanes said as soon as the
government acted on the budget and other urgent economic
matters, he would dissolve parliament and call for an
early election.
The President asserted that the country needed a
new and stronger government to maintain public support
for democracy and solve long-term economic problems.
Balsemao criticized Eanes's action and hinted publicly
that he would refuse to continue presiding over a care-
taker administration.
Comment: Eanes has long quarreled with Democratic
Alliance leaders, and he embarrassed them with his demand
that they wrap up unfinished business before he dissolves
parliament. Yielding to Eanes's wishes would embarrass
them further, but refusing would make them appear irre-
sponsible.
The Democratic Alliance brought most of this trouble
on itself. The same disagreements among the coalition
partners over power, personalities, and economic policy
that led to Balsemao's decision to step down also pre-
vented them from uniting behind a credible successor.
An election--probably in late April--now appears
inevitable. The most likely outcome would be for the
Socialists--widely favored to win a strong plurality--to
form a coalition government with Balsemao's centrist
Social Democrats, who have been the senior partner in
the Democratic Alliance. Such a center-left government
would not be likely to introduce major domestic or for-
eign policy changes.
Top Secret
24 January 1983
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OPEC: Nearing Agreement on Quotas
According to press reports, OPEC oil ministers ap-
pear to be nearing agreement today on crude oil produc-
tion quotas within an overall ceiling of 17.0-17.5 million
barrels per day. While individual quotas have not been
mentioned, Saudi Arabia is reportedly willing to limit
its output to a maximum of 5 million barrels per day.
In addition to the overall quotas, the ministers discussed
a possible drop of $2 per barrel in the price of oil
from the Arab Gulf producers, reestablishing the price
differential between the Gulf crude and higher Quality
African oil that existed until last March.
Comment: An overall production ceiling of 17.5
million barrels per day would probably be enough to
support the marker price of $34 per barrel in coming
months, but could run into trouble next spring if seasonal
demand falls below this level.
24 January 1983
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The US Embassy reports Prime Minister Mahathir will
use his visit to Japan this week to revive his "look
East" development policy and to try to obtain a commit-
ment for $300 million annually in aid from Tokyo. Mahathir
also will seek assurances that Japan will not provide
aid to Hanoi until the Vietnamese adopt a more flexible
policy on Kampuchea.
Comment: Under the "look East" policy, Malaysia
would use Japanese and South Korean development strategies
for industrialization rather than relying primarily on
the West. The policy has not caught on with the public
or with Western-oriented cabinet ministers, however,
and the Prime Minister hopes his trip will give it some
momentum. The Japanese, citing budget constraints, prob-
ably will offer to double aid credits to $170 million
for 1983. Tokyo will find it difficult to discuss other
forms of cooperation because Mahathir's delegation does
not include any economic experts.
24 January 1983
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Special Analysis
EL SALVADOR: Politics in the Military
The conflict between Defense Minister Garcia and Army Field
Commander Ochoa--the country's most successful field commander--has
damaged military unity and revealed broad discontent in the armed
forces over the handling of the war effort. Despite the agreement
reached by the adversaries, the situation remains fluid. It is
set against a backdrop of maneuvering by the extreme right and
increasingly aggressive tactics by the guerrillas.
The high command has tried to reduce tensions by
giving Ochoa a choice assignment abroad and by gaining
Garcia's promise to retire within two or three months.
This compromise enables both to save face and allows the
officer corps time to reach consensus on a new leader.
The recent appointment of one of Ochoa's backers as
commander of Cabanas Department appears intended to
reassure his supporters that no reprisals will be taken.
Nevertheless, the high command's refusal to punish
what was widely seen as a serious breach of military
discipline already is giving rise to additional agitation
by Garcia opponents.
Military Uncertainty
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The erosion of support follows six months of growing
criticism in the armed forces over Garcia's judgment and
leadership. His failure to gauge the extent of his oppo-
sition at the beginning of Ochoa's rebellion probably
has reinforced longstanding fears that he has become
isolated from the war and his troops.
The sympathy for Ochoa also underscores growing
military frustration over Garcia's reluctance to adopt
a more aggressive war strategy. Ochoa had repeatedly
criticized the high command's emphasis on large-scale
operations. During Ochoa's rebellion, his condemnation
of Garcia's conventional strategy was endorsed by officers
from a variety of units, particularly those in the Air
Force.
Such issues probably will not be resolved soon, even
with Garcia's retirement. General Vides Casanova, the
director of the National Guard, is next in line to head
the armed forces.
Vides has indicated to US officials that if the
line of succession is maintained, his main objective
would be to act as a conciliator and preserve military
unity. He lacks a broad base of support in the armed
forces, and his ability to institute tactical and strate-
gic changes would be limited.
The Rightist Connection
Ochoa's disagreement with the high command also is
based on ideological factors. As an ultraconservative,
Ochoa and other like-minded officers have become increas-
ingly frustrated by Garcia's enforcement of government
reforms, particularly the agrarian program. Although
the ultraconservatives probably represent only about 15
percent of the armed forces, a number of them are impor-
tant and popular field commanders.
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Extreme rightist Assembly leader D'Aubuisson increas-
ingly has tried to exploit dissatisfaction in the military
to break the power of Garcia, whom he holds responsible
for thwarting his bid for the presidency.
D Au uisson s party was the only
political grouping that publicly supported Ochoa's actions.
Party officials have admitted to contact with Ochoa
as the rebellion progressed, but they have denied any
involvement in his actions.
Encouragement for the Insurgents
The guerrillas have exploited the military power
struggle for maximum propaganda and tactical effect.
Clandestine radiobroadcasts have emphasized the split
in the high command to support the insurgents' claims
that the tactical situation is now in their favor. The
guerrillas also have used some of Ochoa's allegations
of corruption in the high command to buttress their
appeals that government troops join with them against
military leaders and foreign interests.
The insurgents have long planned an offensive for
the beginning of this year and may have advanced their
timetable to take advantage of the rebellion. They are
increasing actions against towns and economic targets
throughout the country, particularly in the northeast.
The government has launched a major counteroffensive
partly designed to indicate the crisis within the armed
forces has not deterred its ability to carry the war to
the guerrillas. Nevertheless, the operation is being
directed almost exclusively by the regional field com-
mander with little support from the General Staff. This
is an indication that the military hierarchy may be in-
creasingly preoccupied with its own power struggle.
24 January 1983
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Top Secret
Top Secret
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