LATIN AMERICA REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00289R000301550001-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 27, 2016
• Document Release Date: May 17, 2011
• Sequence Number: 1
• Publication Date: June 6, 1986
• Content Type: REPORT

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Directorate of
Intelligence
MASTER FILE COPY
DO N"'OT GIVE OUT
08 MARK ON
Latin America
Review
Seerct
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ALA LAR 86-013
6 June 1986
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Latin America
ReviewF--] 25X1
Chilean Communist Party efforts to become the country's main
opposition force and destabilize the Pinochet regime are not likely to
succeed any time soon, but the Communists probably will stick to a
timetable aiming at an all-out insurrection within three to four
years.
Havana is embarking on a "get tough" campaign against crime,
official mismanagement and corruption, and apathy in the labor
force, but the repression is likely to increase strains in the social
fabric.
President Garcia is cultivating closer ties to Managua to mollify his
domestic leftist opponents and boost Peru's prospects for gaining the
chairmanship of the Nonaligned Movement, but he has made little
headway in efforts to persuade other regional leaders to support his
policy toward Nicaragua.
Tendencia, a small, pro-Cuban faction in the ruling party, serves as
the military's conduit for criticism of the United States and its ties
to leftists both inside Panama and abroad, but the faction has only
limited influence over government policy.
Increasing urban street crime, especially in Sao Paulo, could lead to
defeats for the ruling coalition's largest party in gubernatorial and
congressional elections scheduled for November.
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ALA LAR 86-013
6 June 1986
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Regional Military Plan
Cuba: More Changes in Government
Mexico: Parastatal Liquidation
Nicaragua: Foreign Ministry Financial Problems
Production Staff, Office of African and Latin American Analysis
Comments and queries regarding this publication may be directed to the Chief,
Articles have been coordinated as appropriate with other offices within CIA.
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Review
Chile:
The Communist Threat
The Communist Party of Chile (PCCh)-one of the
oldest, best organized, and, after Cuba's, the largest
such party in Latin America-is making considerable
headway, in our view, in its campaign to stage
frequent antiregime protests, harass the security
forces, and gain acceptance as the country's leading
opposition force. Communist leaders have decided,
to promote a national
uprising against President Pinochet in 1986. They
reportedly believe that, if Pinochet is not ousted this
year, he can outmaneuver his opponents and retain
power until his term ends in 1989. The Communists
reportedly think that other parties, including the
centrist Christian Democrats-the country's
largest-also realize that this is a critical year and are
therefore becoming more willing to collaborate with
the PCCh in demonstrations. We believe that the
Communists will not succeed in becoming Chile's
main opposition force or in destabilizing the Pinochet
regime any time soon. Nevertheless, in our judgment,
the PCCh will not deviate from its basic strategy of
seeking to oust Pinochet by force, and we believe that
it is following a timetable that calls for launching an
all-out insurrection within the next three to four
years.
Violence on the Rise
The US Embassy reports that following a monthlong
series of university student protests during April-in
which the Communists played a prominent role-
leftist terrorist activity has intensified. Over the May
Day weekend there were numerous bombings,
including one against the US Ambassador's residence
claimed by the PCCh-affiliated Manuel Rodriguez
Patriotic Front (FPMR), and shootouts between
terrorists and police and Army units resulting in
several casualties. There were repeated violent
confrontations between protesters and the security
Chilean Communist Party Strength, Leadership,
and Organization
The PCCh has regained much of the strength it
enjoyed during the Allende era. By early 1985 its
membership had grown to 30,000 and its youth wing
numbered 20,000
. It probably also has about
100,000 inactive members and hardcore
sympathizers. Most of these elements are located in
Santiago and a few other large urban areas. The
PCCh's major recruitment gains in recent years have
been among jobless and underemployed youths, as
well as among university and secondary school
students. It has only limited strength in organized
labor-largely due to the government's efforts to
depoliticize the unions-but controls about 20
percent of union leadership positions and has strong
influence in the country's main umbrella opposition
labor grouping
The party is led by Secretary General Luis Corvalan,
who has resided in Moscow since 1976, and other
exiled leaders, who make up about half of the
Central Committee. The party's internal leaders
frequently travel overseas to meet with Corvalan and
other "old guard"figures-and even the President of
the Christian Democratic Party recently met in
Stockholm with a top PCCh figure
A generation gap has
developed between the exiled leaders, who are in their
60s, and key internal Central Committee members,
who are in their mid-30s, but there is no evidence of
significant internal schisms or divisiveness. The party
has substantial financial resources and is one of the
few Chilean political groups with a sizable salaried
staff.
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ALA LAR 86-013
6 June 1986
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Leftist Terrorist Bombings
1983-139
1984-735
1985-865
1986-continuing unabated (in April alone there were
at least 85 bombings, according to the US Embassy)
We believe that the bulk of these bombings have been
carried out by the FPMR, which,
was created in late 1983 and
initially comprised about 100 young militants from
the PCCh and several other radical leftist groups.
The Front's favorite targets have been electric power
grids-it frequently blacks out Santiago and much of
central Chile-railway lines, commuter buses, and
public establishments in major cities, but most
bombings have been staged in a way seemingly
calculated not to cause widespread civilian injuries.
by late
1985 the Front had grown substantially, and we
estimate that it currently comprises at least 1,000
militants-about half in Santiago and the rest in
other urban areas. Moreover, in recent months the
Front has staged more sophisticated and lethal
terrorist actions and it reportedly intends to escalate
its bombing campaign throughout 1986.
Formerly, the pro-Castro Movement of the
Revolutionary Left (MIR) committed the great
majority of antiregime terrorist incidents, but in late
1983 it suffered sharp reverses at the hands of the
security services and was forced temporarily to halt
its terrorist acts. By 1985,
the MIR had revitalized its apparatus
within Chile-increasing its strength to a total of 400
to 500 members-and was preparing to compete with
the FPMR as the leading terrorist group. It claimed
credit for the bombing of a police bus in February
that resulted in numerous casualties, but the MIR
has yet to resume a sustained level of terrorist
operations. Nevertheless,
the MIR poses a
more serious security threat than the FPMR,~
the MIR's
readiness in the past to assassinate military officers
and its aggressive revolutionary posture.
forces, resulting in considerable property damage in
the capital and several provincial cities. Scattered
protest activity has persisted since May Day, while
student leaders are threatening to call a prolonged
strike unless the government ends its intervention in
the universities. The US Embassy predicts that
strong-arm methods employed by the security forces
against students and faculty will backfire, leading
many Chileans to question the government's ability to
quell student agitation
For their part, the Communists
believe that popular support
is growing for a wide range of anti-Pinochet activities,
including a national work stoppage. They also
reportedly think that the security forces cannot
control the unrest on university campuses and that
elsewhere the Carabineros-the militia-like national
police-are becoming increasingly reluctant to act
vigorously against demonstrators. We believe that the
Carabineros-who are overextended as they attempt
to contain repeated protests-are becoming frustrated
over what they perceive as Pinochet's favoritism
toward the Army and his recent decision to replace
Carabineros with Army troops in many crowd control
missions.
The Communists and other far left parties recently
organized a unified slumdwellers association,
They reportedly
expect to use it to publicize demands for improved
living conditions among the poor and to mobilize
slumdwellers for antiregime demonstrations. The
Communists also reportedly want to recruit
slumdwellers for a "popular army."
they hope to create "liberated zones" in
some slums, where FPMR units would be ordered to
challenge the security forces.
the quality of life
is deteriorating in the numerous slums ringing
Santiago, where youth unemployment ranges up to 50
percent. he situation
in the slums-which probably account for over 1.5
million out of the city's roughly 4 million
inhabitants-is becoming explosive and that the poor
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are becoming politically radicalized and increasingly
receptive to the violent line urged by the PCCh and
other far left groups. Moreover, leaders of several
moderate opposition parties have told US officials
that the government's heavyhanded actions during
recent repeated sweeps by Army units of slum
neighborhoods have produced a sense of "rage"
among the poor that contrasts with the fear produced
by previous dragnets. We believe that this adds to the
explosive situation in the slums and ultimately will
benefit the Communists and their allies.
Moderate Opposition Activities
Moderate opposition forces are also preparing for
more forceful antiregime activities. The key player is
the Christian Democratic Party which
recently decided to push
vigorously for a national strike. The Christian
Democrats are currently consulting with other parties
regarding a strike, and
the party's president has created a secret
coordinating committee to work with the PCCh to
prepare for the strike and other protests. Christian
Democratic leaders, moreover, have acknowledged
that there is substantial grassroots cooperation
between their party and the Communists, which they
justify by citing Pinochet's intractability on political
liberalization and the need to convince the armed
forces through protest activities that Chile is
becoming ungovernable under Pinochet's harsh
policies.
ccor mg to
the press, even Cardinal-Primate Fresno met several
weeks ago with representatives of the PCCh-led
political coalition to discuss the worsening situation.
This, in our view, was a significant development
because Fresno had previously avoided open contact
with the Communists and had strongly urged the
moderate opposition to forgo all collaboration with the
PCCh. In addition, the US Embassy notes that the
country's conference of bishops last month issued a
strong statement urging constitutional reforms-
widely interpreted as a call for direct presidential
elections in 1989-and that even progovernment
groups endorsed the bishops' stand.
Finally, last month 18 leading professional, academic,
social, and labor organizations of varying political
hues created a so-called National Civic Assembly and
promulgated a set of demands for urgent political and
economic reforms. They also elected a multiparty
directorate that includes two Communists and a few
other far leftists. The US Embassy says that the
Christian Democrats-the main force behind the
Civic Assembly-believe they can mobilize
considerable popular support for such protest
activities as business shutdowns, strikes by
professional guilds, and a campaign to withhold debt
and mortgage payments. Leaders of the Civic
Assembly reportedly hope that these acts of civil
disobedience will create growing uncertainty and help
build further support for the planned national strike.
the President and
against demonstrators.
senior Army commanders are convinced that the
radical left will make a concerted effort to overthrow
the government this year and are planning physical
attacks on Pinochet, junta members, and military
officers. The Army has moved 10,000 troops from
bases in the north to the Santiago area, created new
antisubversive commando units, and ordered large
numbers of soldiers into the streets to supplant
Carabineros during recent demonstrations. The US
Embassy reports that Army troops were deployed in
unprecedented numbers over the May Day weekend
and that the security forces often used excessive force
Meanwhile, Pinochet refuses to budge as pressure
builds within the regime for some show of flexibility
and the opposition continues its protests. In several
recent speeches the President has rejected
modifications in the constitution-which allows for
his reelection in a single candidate plebiscite in
1989-and refused to speed up political liberalization.
Nevertheless, there is accumulating evidence that
many of Pinochet's civilian advisers and some military
officers-including most of the junta members-want
the President to step down in 1989, liberalize the
political process, and negotiate with moderate
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opposition groups to prepare for a transition to civilian leadership will probably leave the President more and
rule before the end of the decade. Many of his more isolated. Many officers are beginning to
advisers have urged him to take these steps to head off question the soundness of his decisions and they may
a rising tide of protest activity and avert a chaotic begin to pressure him to shift course or else face a
situation that eventually would enhance Communist more open challenge from the military.
prospects to promote an all-out insurgency.
Pinochet has turned a deaf ear to these
recommendations, and instead has ordered an
intensified crackdown on the opposition
officers is promoting a plan to revise the constitution
to provide for a direct presidential election in 1989.
Outlook
We believe the Communists have little chance of
sparking a successful uprising against Pinochet over
the next year, but that they will continue to make
headway in their efforts to sow violence and
uncertainty. Moreover, moderate opposition groups
will probably cooperate more frequently and openly
with the PCCh even though they realize that this will
add to a climate of violence and could play into
Pinochet's hands. The moderates seem prepared to
take this risk because they see no alternative to an all-
out effort to show the armed forces that the country is
becoming ungovernable under Pinochet's rule and
that the military must force him to become more
flexible.
The litmus test of the Communists' plans-and those
of the moderate opposition-will, in our view, be their
ability to sustain the current level of protest activity
and to build momentum toward a national strike
during the next three to four months. Even though
protest activity is likely to continue at a high level
during this period, accompanied by frequent and
increasingly lethal terrorist bombings, prospects for a
successful prolonged strike do not appear bright at
present. Nevertheless, opposition protest activity,
increased terrorism, and growing unease within the
government and the armed forces over Pinochet's
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Cuba: Castro Cracking Down
There are numerous signs that Havana is about to
adopt a "get tough" policy to resolve some of its
serious economic and domestic ills. Crime, juvenile
delinquency, corruption, bureaucratic mismanage-
ment, and deep-seated apathy in the labor force
appear to be the targets of what promises to be a
disruptive political campaign to restore vitality to
President Castro's revolution. We doubt, however,
that greater repression will produce the desired
effects, and, in fact, it will be more likely to increase
significantly strains in the Cuban social fabric.
Combating Crime
The seriousness of the crime problem was officially
acknowledged on 22 May when, according to the
Cuban media, a regular session of the party's ruling
Politburo was held at which "an extensive analysis
was made of the problem of crime and antisocial
behavior, especially the number of incidents in the
city of Havana." With Castro presiding, the Politburo
approved measures designed to intensify research on
the causes of antisocial behavior, develop an
integrated approach to combat it, and promote more
effective measures by the mass organizations to
prevent it. Also approved were bureaucratic
adjustments to improve the efficiency of the police,
the Attorney General's office, and the courts, as well
as unspecified measures "to neutralize and strongly
sanction aggressive conduct, violence against others,
and the brutality that has been seen in the capital."
The highly unusual public treatment of the sensitive
Politburo discussion suggests that the crime problem
has become so acute that the Cuban leadership
decided publicity was needed to intimidate criminals
and bolster public confidence in the government.
Presumably to underscore the significance of the
anticrime measures, the Politburo invited to its session
several top party and government officials who will be
responsible for implementing its decisions.
The following day, Armed Forces Minister Raul
Castro presided over a joint ceremony in Havana in
which a large unit of police cadets graduated from an
Interior Ministry training facility and an Armed
Forces Ministry "Red Beret" reserve contingent was
incorporated into the national police force. This
ceremony was also accorded press coverage and
attended by many top party, government, police, and
military officials. The strengthening of police ranks
with "Red Beret" military personnel and Raul's
chairing of what is essentially an annual Interior
Ministry function are further evidence of the high-
level concern over the crime problem and the regime's
determination to resolve it.
The rise in crime is well documented.' As recently as
mid-May, the US Interests Section reported that the
foreign community in Havana is convinced there has
been an increase in crime, attributable in large part to
the inability of the Cuban system to satisfy the
material expectations of the populace. The Interests
Section noted, for example, the armed robbery of a
Scandanavian businessman in his Havana home
earlier this year, seven burglaries at the residences of
Interests Section personnel-including that of the
principal officer-in the past 12 months, the more
than 20 actual or attempted break-ins at residences of
Canadian Embassy personnel over the past year, and
the burglary at the chancery of the Nigerian Embassy
late last year. The Interests Section also learned from
sources of undetermined reliability that a bank in the
Havana suburb of Guanabacoa was robbed of the
equivalent of $70,950 in Cuban currency in early
May by thieves tunneling into the bank and using 25X1
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ALA LAR 86-013
6 June 1986
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two months prior to the
Politburo deliberations, the party's Secretariat held a
special session to discuss the problem of juvenile
delinquency throughout Cuba and the establishment
of new programs to reduce it. The Secretariat
determined that, although delinquency involved
youths from 16 through 26, the major problems were
caused by those in the 16-to-21 age bracket. The
Secretariat's analysis showed that delinquency
developed in youths who were neither working nor
attending school, and was attributable to high
unemployment, a lack of activities for young people to
occupy their free time, poor ideological work by the
mass organizations, and weak family ties. Prior to its
special session, the Secretariat sent several Central
Committee members to solicit proposals from
representatives of the mass organizations on how to
develop programs on an urgent basis to reduce
delinquency.
Condemning Inefficiency
Crime and juvenile delinquency are not the only
targets of the government's mounting campaign.
Since Fidel Castro's blistering denunciation of
corruption, bureaucratic inefficency, and worker
apathy at the party congress in February, Cuban
officials, mass organizations, and the media have been
reiterating his criticisms. In his May Day speech, for
example, labor union head, Roberto Veiga lashed out
against worker inefficency, irresponsibility,
parasitism, and tolerance of deficiencies. His remarks
address many of the practices that have been
undermining labor productivity in Cuba for years,
such as:
? Rampant absenteeism.
? Embezzlement and misappropriation of material
resources.
? An absence of personal initiative and a tendency to
shift decisionmaking to the next higher level of
authority.
? The reluctance of managers to establish and enforce
criteria for worker performance.
Similarly, on 28 May, the party first secretary in
Havana City Province spoke out against the lack of
supervision and initiative, and condemned "excessive
centralism and bureaucracy, absenteeism, labor
indiscipline, and deficient cadre policies." On the
same day, the head of the neighborhood vigilance
committees publicly pledged his institution's support
in the fight against criminal activity and backed the
Politburo's efforts to curb antisocial behavior. The
chiefs of the mass organizations for women and for
peasants have also spoken out in recent weeks in what
appears to be a calculated campaign by the leadership
to warn the Cuban people that repressive actions will
follow if verbal exhortations fail to shatter popular
complacency.
The official rhetoric is accompanied by what appear
to be the first steps of a broad crackdown. Police, for
example, are stopping trucks to check on the
destination of their cargoes in an effort to stem the
diversion of materials, according to the US Interests
Section. In addition, a visitor to Cuba told the
Interests Section in April that a videotape was
circulating in party channels showing Castro
administering a dressingdown to officials for their
poor performance and craving for creature comforts.
In a similar vein, a new law on "material
responsiblity" that went into effect last month
established procedures for pinpointing blame on
managers or workers who cause financial or material
losses through mismanagement, inefficiency, laziness,
or other noncriminal dereliction of duty. While such
laws may seem workable in theory, we believe they
are likely to be far more divisive than remedial in
light of the unusual lack of discipline that pervades
the work force.
Castro is sufficiently concerned about the loss of
revolutionary vitality to carry his reinvigoration
campaign personally to the workplace. Television
cameras accompanied him in early May on an
inspection tour of the construction site for the new
Institute of Tropical Medicine in Havana, where he
pointedly asked if all the workers had shown up for
work. Accusing one worker of reading a newspaper on
the job, Castro was told by the construction boss that
it was a blueprint, not a newspaper. He then lectured
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the boss on the need for productivity and hard work,
telling him to appeal to the workers' "sense of
shame."
Outlook
The recent increase in Castro's personal involvement
in the campaign against crime and inefficiency
suggests that his speeches and appeals for greater
efforts over the past 18 months have not been
successful in motivating the population. Neither has
his talk of the alleged US military threat produced
the desired results, and widespread apathy persists.
Castro now appears to have decided that a
combination of public criticism and repressive
measures is needed to prod the public into a greater
appreciation of its critical role in the struggle to
overcome mounting economic problems. Following his
urging to the Cuban Journalists' Union in late April
"to participate in the fight against everything that
slows the progress of the revolution," the press can be
expected to increase its involvement in the politically
sensitive area of investigative journalism in coming
months. Although Castro promised in April not to
unleash a radical wave of repression along the lines of
the Chinese "cultural revolution," his words and
actions indicate he definitely is beginning a
crackdown.
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Peru-Nicaragua:
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President Garcia has recently taken steps, publicly
and privately, to demonstrate solidarity with the
Sandinista government and to strengthen bilateral
relations. Other South American leaders, as well as
members of Garcia's own government and party, have
reservations about Garcia's outspoken defense of
Nicaragua. Nonetheless, Garcia evidently believes
that cultivating closer ties to Managua serves useful
domestic and foreign policy purposes, such as
mollifying various opposition groups to the left of his
government and boosting Peru's prospects for gaining
the chairmanship of the Nonaligned Movement
(NAM). Garcia is unlikely to soften his anti-US
stance on Central America in the coming months, but
may eventually temper this policy if the general
climate of Peru-US relations-particularly on the
debt issue-becomes less confrontational. Other
regional leaders do not support Garcia's pro-
Nicaragua position, but they are not likely to
denounce him publicly.
Reinforcing Bilateral Ties
President Garcia's moves to strengthen bilateral
relations with Managua this year is a change from his
earlier multilateral approach of using the Contadora
"support group," which he initiated in July 1985.
Until recently he confined his rhetoric on Central
America to abstractions, affirming Peru's fidelity to
such principles as noninterference and regional
solidarity, but avoiding specific policy commitments.
In mid-March during a state visit to Argentina,
however, he declared that Peru would break
diplomatic relations with any country that invaded
Nicaragua and pledged to "defend the brother
country." Garcia's gambit in Argentina followed a
visit to Peru (and Brazil) by Nicaraguan Interior
Minister Borge. Although Garcia was not directly
responsible for the invitation, he publicly embraced
Borge-a gesture which was widely reported in the
Peruvian press.
Last month, Garcia-in Costa Rica for President
Arias's inauguration-called on the Latin nations to
provide economic assistance to Nicaragua. Two days
later Lima announced a $26.5 million trade and aid
package for Nicaragua that included:
? A$ 10 million trade credit.
? Refinancing of Managua's $6.5 million debt.
? Delivery of $10 million in Peruvian goods, free of
charge, to Nicaragua in partial repayment of
Lima's debt to Moscow.
Earlier this year, Nicaraguan President Ortega
invited Garcia to be the guest of honor at the July
anniversary celebration of the Sandinista revolution.
Garcia, who typically keeps his options open as long
as possible, has not yet indicated if he will attend.
Garcia Standing Alone
Ignoring the reservations of close advisers, Garcia is
apparently determined to press on with his strong
support for Nicaragua, even if his counterparts in the
region do not follow suit. His pledge to stand by the
Sandinista regime in the event of US military
intervention so far has not been seconded by any of
Latin America's other democratically elected leaders,
despite Garcia's recent campaign to win such
endorsements.
Since January, Garcia has visited several Latin
capitals, including Argentina, Uruguay, and Costa
Rica. These trips have provided him with high-
visibility platforms to promote his views on regional
issues, grab international headlines, and boost his
image as a Third World leader worthy of chairing the
NAM. He has played to the gallery at every
opportunity, hoping to attract a popular following
throughout Latin America. He is evidently betting
that the same populist appeal that has kept the
Marxist opposition at bay in Peru will also give him
leverage in dealing with other Latin leaders. Garcia's
latest efforts, however, have met with considerable
resistance.
Secret
ALA LAR 86-0/3
6 June 1986
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Garcia
offended Argentine President Alfonsin by having his
pro-Nicaragua speech before the Argentine Congress
videotaped and later broadcast in Havana and
Managua.
Alfonsin was also angered by Garcia's favorable
mention of Che Guevara
Garcia's controversial remarks in Argentina caused
Uruguayan President Sanguinetti to take unusual
precautions when the Peruvian President visited
Montevideo.
Sanguinetti tried to limit Garcia's press and speech-
making opportunities in Montevideo because he
believes Garcia's penchant for unilateral
pronouncements works against the more moderate,
constructive policies of other South American
democracies.
threat of US military intervention. Equally important,
however, cultivating Managua serves several political
purposes for Garcia:
? It demonstrates to the Peruvian rank and file that
he is willing to confront the rich and powerful in
defense of the poor and downtrodden.
? It rewards Moscow for restraining the opposition
activities of the Peruvian Communist Party and the
Communist-dominated General Confederation of
Peruvian Workers.
? It preempts criticism from the United Left coalition,
currently Peru's major opposition party.
? It takes on renewed importance in light of Peru's
recent decision to improve relations with the IMF
by making a payment.
? It mollifies the left wing of his own American
Popular Revolutionary Alliance party.
? It helps position Peru to bid for chairmanship of the
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Sanguinetti had also consulted directly with the
Presidents of Argentina, Brazil, Ecuador, and
Colombia, all of whom reportedly share his
reservations about Garcia's unilateral policies and
inflammatory rhetoric.
The Sanguinetti government generally viewed its
handling of the Garcia visit as a success because it
engaged the Peruvian president in a constructive
dialogue that resulted in the signing of a moderate
final communique, according to the US Embassy. The
two Presidents also sent a joint letter to the Core Four
and Nicaragua urging them to sign a Contadora
treaty by the 6 June deadline. Nonetheless, in his last
public appearance in Uruguay, Garcia told reporters
that Peru condemns US policy in Nicaragua "openly,
publicly, and without fear." He added that if US
pressure pushed Managua into the Soviet "orbit" it
would be "understandable."
Garcia's call for Latin America to give economic aid
to the Ortega government when he visited Costa Rica
last month was a significant step beyond his previous
rhetorical support for the Sandinistas. Other Latin
leaders present, however, ignored Garcia's gambit.
NAM, which will be decided in September.
Garcia has not publicly announced Peru's candidacy
for the NAM post but he probably hopes that his
vigorous defense of Managua-which has actively
campaigned for the NAM chairmanship-will attract
support to Peru as the logical compromise choice in
the region. Key NAM members such as Yugoslavia,
Egypt, and India-who reject Nicaragua's
candidacy-reportedly favor Peru. More radical
Third World governments-impressed with Garcia's
anti-US rhetoric and confrontational style-probably
will not resist the growing consensus favoring Peru.
Garcia may try to reap some trade and aid benefits as
well. The modest $10 million "triangular trade"
arrangement involving Nicaragua and the USSR is a
case in point.
Prospects
Garcia is likely to maintain his defiant public posture
toward the United States, but may moderate his pro-
Nicaragua stand if Peru's differences with
Washington in other areas-above all, debt
repayment-are eased. In any event, a softening of
Peru's position on the Central American conflict is
Garcia's Political Strategy
Garcia's own anti-imperialist outlook colors his
attitude toward the Nicaraguan Government, which
he sees as a besieged Latin country faced with the
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unlikely before the end of 1986. Nationwide
municipal elections are scheduled for November and
Garcia, as an adroit politician, will not give his major
opposition-the Marxist United Left coalition-an
issue to attack him and his party's candidates.
Moreover, Garcia has used his strong defense of Latin
rights against "imperialist" encroachment,
symbolized by the Nicaraguan conflict, to draw
support away from the leftist opposition's natural
constituents-particularly Lima's slumdwellers, who
helped incumbent Communist Mayor Barrantes win
the last election.
Other leaders in the region will continue to keep
Garcia at arm's length and resist his effort to enlist
their cooperation on behalf of Nicaragua.
Nonetheless, he would have to go much farther than
he has so far in his relations with the Soviet Bloc-for
example, allowing Moscow to build a naval base in
Peru-before his regional counterparts would attempt
to isolate him politically or economically.
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Panama:
Ruling Party Leftists
Tendencia, the small Marxist faction of the
ideologically diverse ruling Democratic Revolutionary
Party (PRD), is a pro-Cuban group opposed to the US
presence in Panama. Its association with the
government party, which is controlled by the
Panamanian Defense Forces, mutes both its militancy
and influence over government policy. Nonetheless,
its influence within the Panamanian left and among
organized students and its solid financial base make it
a valuable ally of the military. Tendencia has served
as the military's link to leftist groups in Latin
America and has provided occasional assistance to
them. We believe the faction will remain an integral
part of the PRD and will continue to be the military's
conduit for criticism of the United States and its
contact with the left in Panama and leftist
governments and groups abroad.
The origins of Tendencia lie in the aftermath of the
1968 coup that brought National Guard Commander
Torrijos to power. Anxious to mobilize mass support
for the return of the Panama Canal, Torrijos sought
the allegiance of organized students. Because the
Youth Commission of the Panamanian Communist
Party-headed by Ramiro Vasquez-controlled the
most powerful student organization, the 70,000 strong
Panamanian Student Federation, Torrijos focused
considerable effort on wooing it. By the early 1970s he
had succeeded in winning over Vasquez and the
student group, although relations with the Communist
party remained strained,
In 1974 Torrijos urged Vasquez to
break with the Communist party and align his
federation directly with the National Guard in
exchange for financial support. Vasquez agreed and
subsequently formed the Tendencia, whose name
underscores the group's Marxist "tendencies" and its
stated goal of eventually becoming a full-fledged
Communist party. The National Guard continued to
subsidize Tendencia's activities, and ties between
Vasquez and Torrijos deepened over the next four
years. In 1978 Vasquez led his group into Torrijos's
newly formed PRD.
Secret
ALA LAR 86-013
6 JUne 1986
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Brazil:
The Politics of Crime
With violent street crime rising in most large
metropolitan areas, particularly in Sao Paulo-
Brazil's largest city and its industrial and commercial
hub-"law and order" could become a pivotal
political issue in some of the state gubernatorial and
congressional election to be held in November. The
issue may cause the defeat of the ruling Brazilian
Democratic Movement Party (PMDB) in the Sao
Paulo election, and we believe it will also subtly
influence the makeup of the Constitutional Assembly
that will reform Brazil's political system next year.
Crime in Sao Paulo
Although crime statistics are unreliable, polling data
reported by the US Consulate indicate nearly one in
three Sao Paulo residents has been the recent victim
of assault, mugging, or robbery. The mainspring of
street crime in Sao Paulo-as well as other large
Brazilian cities such as Rio de Janeiro and Salvador
da Bahia-probably is the large number of
unemployed who live in slums and shantytowns in the
metropolitan area. These individuals, known as
"marginais," have migrated from the rural areas in
search of jobs, but have found only poverty and
hunger. Moreover, a large number of juveniles-
estimated at 10 million nationwide-roam the streets
because of overcrowded housing and poverty,
according to the US Embassy. These street people,
who turn to crime as a source of subsistence income,
account for most small robberies.
Press reports sensationalizing violence and white-
collar crime are creating a cynical public attitude
toward the criminal justice system, according to
opinion polls. For example, the US Consulate reports
that Gallup polls last year showed that Sao Paulo
residents rated the police and the criminal courts at
the bottom of public services. Contributing to the
cynicism are the illegal gambling operations that are
conducted openly in some cities with little or no police
effort to control them. Moreover, more crimes are
being committed to finance an increase in drug use
and trafficking in the cities. For example, a large car
theft ring broken up by Sao Paulo police in April
traded stolen autos for Bolivian cocaine, which was
then reexported, according to the Consulate.
The Political and Social Repercussions
Sao Paulo state Governor Franco Montoro of the
PMDB-the senior partner in President Sarney's
coalition government-is blamed by most voters in
the city for the state's ineffectual handling of crime,
according to the US Consulate. Although the
governor has hired additional state police and
increased the capacity of state prisons during his
tenure, rivalries between various branches of the state
police and general inefficiency are hampering
enforcement operations. As a result of his perceived
inaction and the rising crime rate, the governor has
earned a "soft on crime" image with the public.
Conservative ex-President Janio Quadros defeated his
PMDB opponent in last November's mayoral election
in Sao Paulo by campaigning on a tough law-and-
order platform, and public attitudes in Sao Paulo
toward criminals have hardened since then. Polls now
show a majority of voters support the death penalty
for violent crimes, as well as a lowering of the age of
criminal responsibility from 18 to 16 years. Residents
view the police as unable to enforce the law, according
to polling data, and have increasingly taken matters
into their own hands. Mobs recently have beaten
criminals and spontaneously lynched alleged street
thieves, according to the Consulate. Citizens are
arming themselves with inexpensive, easily acquired
handguns, and bounty hunters, hired by local
merchants to hunt down and kill suspected robbers,
are fast becoming folk heroes. There are also
unsubstantiated reports that police "death squads"
have carried out several recent executions of
suspected criminals in Sao Paulo.
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ALA LAR 86-013
6 JUne 1986
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Key Issue for November
Political leaders who are jockeying for position in
November's gubernatorial election are promising the
public a stronger response to the crime problem. The
PMDB gubernatorial candidate for Sao Paulo, Vice
Governor Orestes Quercia, is apparently drawing on
the lesson of Quadros's successful exploitation of the
issue. While acting governor earlier this year, he
increased visible street patrols in Sao Paulo and
promised police reform, if elected. Quercia, however,
is fighting an uphill battle.
Opposition candidates in Sao Paulo are attacking the
law enforcement record of the Montoro
administration by using the daily media reports about
violent crime in the city. Conservative Congressman
Maluf, the likely gubernatorial candidate of the
Social Democratic Party, has strongly attacked the
state administration's record on corruption, police
brutality, and rising crime, according to the
Consulate. Even the Marxist Workers Party-whose
candidate for governor, Eduardo Suplicy, is a strong
contender-picked up the rising crime theme in its
March television broadcast, linking the problem to
unemployment. Quadros's established reputation as a
crimefighter may enable him to throw decisive
support behind a law-and-order candidate in the
gubernatorial election, in our view. Attacks such as
Maluf's, combined with the unpopularity of Governor
Montoro could further weaken the already divided
PMDB and deal a crushing blow to Quercia's
candidacy. His defeat would be a major setback for
the Sao Paulo faction of the PMDB and probably
would greatly diminish its influence in the Sarney
administration.
The Broader Ramifications
We believe crime probably will be a major and
emotional issue in several gubernatorial campaigns
this year. Press reporting indicates support for strong
action against crime is found across the political
spectrum. The middle and upper classes-whose
usually heavy voter turnout is considered by many
Brazilian political observers to be crucial in deciding
an election-are the most vocal in their demand that
state governments take concrete action. For example,
Vice Governor Ribeiro of Rio de Janeiro, a possible
senatorial candidate, is closely identified with the
lackluster record of leftist Governor Brizola in
fighting crime and administrative inefficiency, which
will probably hurt him in November. A recent poll
shows Ribeiro trailing potential opponents badly,
according to the US Embassy.
We judge that congressional candidates also will find
the law-and-order issue an appealing one for
campaigning among the middle and upper classes.
Growing local discontent with police efforts could
manifest itself in more protest votes against
incumbents in November. Such a trend, in our
opinion, probably will work to the advantage of
populist and demagogic candidates, especially
conservatives, and could bring a sizable number of
such candidates from the urban areas into the
Congress, providing the institution with a more
conservative cast. Moreover, these delegates-who
will comprise the Constitutional Assembly that will
reform Brazil's political system next year-will be
well placed to influence policymaking on a broad
range of social issues in the future.
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Honduras Clampdown on Salvadoran Guerrillas
The Honduran Armed Forces are bolstering operations intended to disrupt
Salvadoran guerrilla use of Honduran territory for refuge and infiltrating arms
and supplies into El Salvador. The rebels have used camps in Honduras as a
valuable source of medical supplies, food, and clothing,
pecial Forces units
patrolling near refugee camps and along the border with El Salvador have been
increasingly aggressive, ambushing insurgent infiltration routes and attacking
suspected guerrillas in Honduran territory. Since capturing sizable caches of arms
in April, the patrols have increasingly focused on interdicting guerrilla shipments
and turned up several smaller caches of arms and medical supplies in May,
have assigned military escorts to refugees
traveling outside the United Nations-administered camps.0
The US Embassy in Tegucigalpa reports that a US proposal to erect a guarded
barrier system around the main refugee camps, which have a combined population
of 21,000, is gaining support among influential Hondurans, including some
previously thought to sympathize with the Salvadoran guerrillas. The Armed
Forces reportedly are prepared to implement the plan, pending disbursal of
promised US funding for it. The project, coupled with increased patrolling in the
field, probably will help limit guerrilla use of Honduran territory.
Regional Military Plan
Senior Honduran military officers are trying to reactivate the Central American
Defense Council (CONDECA) because they believe current military and
diplomatic efforts to alter the Sandinista regime in Nicaragua will fail.
as received favorable
responses from El Salvador, Guatemala, and Costa Rica to revitalize CONDECA,
which was founded in the early 1960s but has been paralyzed by regional rivalries
and domestic crises through most of its history. Nicaragua, a charter member, has
not been invited to recent meetings.
Tegucigalpa wants CONDECA to assess prospects for the anti-Sandinista
guerrillas and to meet in early fall to draw up a regional defense plan. The
Hondurans also hope the group will develop contingency plans for a joint invasion
of Nicaragua, which they recognize would require logistic and air support from the
United States.
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bellicose posture in the region.
In our view, concerted military action against Nicaragua remains highly unlikely.
There is no sign that the region's military commanders, who have been more
supportive of military action, have yet persuaded their civilian counterparts to
support such a policy. Moreover, El Salvador and Guatemala are preoccupied with
insurgencies, and Costa Rica lacks an offensive military force. Honduras itself has
stated in the past that it will not fight what it views as essentially a US conflict
with Nicaragua and, in any case, its Armed Forces remain seriously handicapped
by inadequate armaments, weak leadership, and poor communications. The
CONDECA plan-which was resurrected and failed in 1983-84-may also run
into legal problems because Nicaragua is a full member while Costa Rica is only
an observer. Tegucigalpa's principal goal, in our estimation, is to unite the Central
American democracies behind an anti-Sandinista stance, thereby spreading out
the burden of supporting the Nicaraguan rebels. The Hondurans also probably
would like to have a regional organization-similar to the Caribbean group that
urged US intervention in Grenada in 1983-that could press Washington to take
direct military action if the Sandinistas consolidate their regime and assume a
Cuba fired its Communications
Minister, Pedro Guelmes, on 24
High-level personnel shifts and organizational changes in the Cuban Government
are continuing as expected.a The latest Cabinet official to be removed is
Communications Minister Pedro Guelmes, who years ago paved the way to his
ministerial assignment by performing well as chief of communications in Raul
Castro's Armed Forces Ministry. His replacement, Manuel Castillo Rebasa, also
served as armed forces communications chief until being named Minister of
Communications on 24 May. While Castillo Rebasa's military post may have
provided him with a solid technical background for the job, his lack of experience
in the Communications Ministry is likely to put him at a disadvantage in
managing the national communications system. His appointment, however,
reflects the influence that Raul Castro continues to wield in the selection of
candidates for top government posts.
might expose their managerial weaknesses.
In addition, a new element of the bureaucracy-the National Commission of the
Economic Management and Planning System-was created in late May. It is
subordinate to the Council of Ministers and its chairman will have ministerial
rank. Based on reports in the Cuban media, the new commission appears to have
responsibility for assuring that all economic planning and management systems
and techniques employed throughout the government are integrated, standardized,
and complementary. The broad scope and intrusive nature of the commission's
mandate are likely to prove disruptive in an already chaotic bureaucracy, as
officials at various levels try to protect their domains and resist any efforts that
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diplomatic experience.
Julio Camacho Aguilera, a Politburo member and longtime guerrilla comrade of
President Castro, was named Cuba's Ambassador to the Soviet Union on 20 May.
An original member of the Cuban Communist Party's Central Committee-
established in 1965-he had briefly headed the Transportation Ministry and then
the Political Training Department of the Central Army before serving
consecutively as First Secretary of three provinces during the last 18 years
Camacho, an ideological hardliner, replaces prerevolutionary Communist Lionel
Soto-a Secretariat member in charge of domestic and foreign economic relations
who may be returning to Havana to concentrate on economic matters. Camacho's
appointment to Moscow-the first of a Politburo member-may be a tactical
move on Castro's part to gain a more generous response to Cuban requests for
additional Soviet aid by sending such a high-ranking party official. Camacho
could be hampered in his efforts, however, because of his lack of economic and
there have been large demonstrations opposing the government's action.
The Mexican Government's recent decision to shut down operations at the state-
owned Fundidora steel complex-one of the three largest state-owned steel
companies-is proving highly controversial. According to press reports,
Fundidora's outstanding debts were $380 million and losses last year totaled $48
million. Despite the firm's inefficiency, the move has had a devastating impact in
Monterrey, costing some 60,000 jobs, according to the US Embassy. As a result,
widespread closure of other parastatals.
The shutdown marks the first time the government has closed a major parastatal.
Although the de la Madrid administration has been under pressure from
international creditors to sell parastatals and to cut public spending, the closing of
the steel complex probably does not portend a step toward major structural
changes in the Mexican economy. Instead, in our judgment, the decision resulted
from the drastic economic losses incurred by the firm. Given the popular backlash
against the decision, as well as Mexico City's strong desire to avoid exacerbating
its unemployment problems, the action is unlikely to establish a precedent for
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Nicaragua Foreign Ministry Financial Problems
The financial problems of Nicaragua's chronically hard-pressed diplomatic
missions apparently have worsened this year.
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