SUPPORT TO THE WHITE HOUSE: PRESIDENT NIXON'S TRIP TO FAR EAST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP04T00447R000302450001-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 16
• Document Creation Date: December 22, 2016
• Document Release Date: May 17, 2010
• Sequence Number: 1
• Publication Date: August 12, 1985
• Content Type: MEMO

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Memo For: Acting Chief/NAD
Acting Chief/GHD
Acting Chief/SEA
From:
U"&" a
12 August 1
Subject: Support io the White House: President Nixon's Trip to Far Ea
he Ops Center, calling on behalf-of the NSC asked this
morn.ng that we prepare one-page issue reviews andone-page fact sheets
as abckground briefing material for fo.rmer.Pre.sident.Nixon.'s-upcoming
tour of the Far East.
Countries to be'covered: China
-Japan
South Korea
Hong Kong--
Singapore
_ Thailand-
.Due to D/OEA: ,-
Format:
'questions
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JAPAN FACT SHEET
Population: 120,691,000 (July 1985), average annual growth rate 0.6%.
GNP: $1,190 billion (1984), $9860 per capita income, real growth 5.7%;
projected real growth rate 4.8% for 1985.
Unemployment: 2.5%; Inflation: 2.4%.
Foreign Trade: Exports: $168 billion (36% US)
Imports: 124 billion (22% US)
Trade Surplus: 44 billion ($33 billion with US)
Current Account: 35 billion ($31 billion with US)
Budget: $210 billion (FY 1985); deficit $48 billion (4% of GNP).
Aid Committed: $4.3 billion ODA (JFY 1985); preliminary discussions
indicate aid may increase 10% next year.
11
Military Spending: $12.5 billion (FY 1985), up 6.9 % over JFY 1984; will
probably edge over 1%-of-GNP barrier sometime this year.
Political Parties:
Party
Leader
Seats
Governing:
Liberal Democrats
Nakasone
263
New Liberal Club
Kono
8
Opposition:
Socialists
Ishibashi
112
Komeito
Takeiri
59
Democratic Socialists
Tsukamoto
38
LDP Power Balance:
Communists
Miyamoto
24
--Nakasone Faction (66 members): Prime Minister Nakasone's term as
Party President expires October 1986; has highest popularity rating in
recent history; may hope to change party rules to run for third term.
--Tanaka Faction (124 members): so-called kingmaker Tanaka still in
poor condition following stroke in February. Finance Minister Takeshita
ahead of Party Vice President Nikaido in succession contest.
--Suzuki Faction (80 members): Party Executive Council Chairman
Miyazawa dark horse candidate to succeed Nakasone.
--Fukuda Faction (73 members): Foreign Minister Abe leading candiate
to become next prime minister.
--Komoto Faction (35 members): likely to disintegrate; Komoto has
just resigned cabinet post due to bankruptcy of steamship company.
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SECRET
Tokyo remains committed to reducing the government debt, estimated
at $540 billion. Nakasone, therefore, wants to:
--Maintain budgetary austerity and force deficit reduction.
--Privatize public corporations.
--Avoid resorting to fiscal measures to stimulate domestic demand.
Relying on exports to fuel economic growth has created tension in
Japan's relations with most of its trading partners, especially with the
United States. To head off US protectionism, Nakasone has:
--Agreed in the May 1984 yen/dollar accord to liberalize financial
markets.
--Cooperated with Washington's Market Oriented Sector Specific
(MOSS) approach to open markets in telecommunications,
pharmaceutical/medical goods, electronics, and forest products.
--Pushed through the July action program which reduced tariffs and
eased standards and certification procedures.
None of these measures is likely to make a big dent in the trade
surplus, at least in the near term. To placate its trade partners,
Japan has relaxed budget discipline to permit expansion of defense and
foreign aid.
Under the leadership of Prime Minister Nakasone, Japan has become
more confident and assertive. Although the US-Japan relationship
remains the cornerstone of Japan's foreign policy, Tokyo is increasingly
willing to pursue its own interests.
--Despite Nakasone's interest in promoting dialogue with Moscow, his
support for stronger defenses and alliance with the US suggests
Japanese relations with the Soviet Union will remain cool.
--Despite Japan's trade surplus with China, Nakasone's trip to
Beijing last year and the ministerial meeting last month showed
the importance Tokyo attaches to their relationship.
--Although Japan is trying to expand ties to Europe, the Europeans
are becoming increasingly critical of Japanese trade practices,
and Nakasone's tour of Europe did not ease their conerns.
--Despite Japan's support for South Korea, it is increasing its
contacts with the North since the lifting of Rangoon sanctions.
--Criticism from ASEAN has been temporarily defused by the trade
package, but demands for access to Japanese markets will grow.
--In an effort to play a role in Mideast peace efforts, Japan last
month invited Iran's number two man, Rafsanjani, to Tokyo and sent
Foreign Minister Abe visited Syria, Jordan, and Saudi Arabia.
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HONG KONG
The December 1984 signing of the Sino-UK accord on Hong Kong's future
ushered in a twelve year transitional period during which the territory's
political and economic future as a Special Administrative Region of China will
be shaped by a number of specialized committees:
-- The Joint Liaison Group, comprised of Chinese, British, and Hong Kong
Government officials, which will resolve issues of common interest to
all parties. First meeting in July confirmed the territory's
continued participation in the Asian Development Bank.
-- The Joint Land Commission will adjudicate land sales and rentals prior
to the territory's reversion to Chinese control in 1997.
-- The Basic Law Draft Committee, established by the Chinese government,
includes 24 Hong Kong citizens. The committee will draft the "basic
law" that will govern Hong Kong for fifty years beyond 1997.
At the same time, the Hong Kong government has embarked on a course of
"democratizing" the territory's political scene.
-- In March 1985 the first "popular" elections for District Board members
took place.
-- This fall voters will indirectly elect members to the Legislative
Council, whose members had previously been appointed by the Hong Kong
Governor.
-- The government hopes to introduce direct elections to the territory's
top legislative bodies by 1987.
-- Nascent political parties are forming, most notably the Progressive
Hong Kong Society under the leadership of Legislative Councilor Maria
Tam.
the local Xinhua news agency--Beijing's unofficial
representative in the territory--is monitoring individuals it believes are
unsympathetic to Beijing's interests.
After a bad year in 1984, the Hong Kong economy has rebounded. The stock
market reached its highest ever levels earlier this year, and investor
confidence in the territory's economic viability has been restored.
-- The Hong Kong Government nonetheless remains concerned over the
effects US restrictions on trade may have on the local textile
industry.
-- Handling of the failure of the Overseas Trust Bank by monetary
authorities has created some concern about growing intervention of the
government in Hong Kong's freewheeling economy.
SECRET
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CONFIDENTIAL
FACT SHEET HONG KONG
PEOPLE Popluation: 5,491,000 (July 1985), average annual growth rate 1.6%
Labor Force: (June 1984) 2.52 million; 3/.3% manufacturing;
commerce; 18.4% services; /.6% construction; /.6%
transport and real estate; 1.2% agriculture, fishing, mining,
and quarrying; 0.4% other; unemployment (seasonally adjusted)
3.6%
GOVERNMENT Type: British dependent territory; scheduled to revert to Chinese
control in 199/.
Legal System: English common law
Branches:
exec ut i ve Council, which advises the governor and
legislates with advice and consent of Legislative
Council; composed of governor, five senior officials,and 12
unofficial members
-- Legislative Council, which is composed of governor,
three exofficio members, and 2/ unofficial members
-- Urban Council, which includes elected representatives
is responsible for health, recreation and resettlement
-- Independent judiciary
LEADERS Hong Kon Government:
-- Sir Edward ou e, Governor and Commander in Chief
-- Sir David Akers-Jones, Chief Secretary
-- Sir John Bremridge, Financial Secretary
-- Mr. Eric Ho, Secretary Trade and Industry
Mr. John D.I. Boyd, Political Advisor
Local Chinese Representatives:
-- Xu Jiatun, Director, i n ua New Agency
-- Li Chuwen, Vice Director, Xinhua News Agency
)OLITICAL Communists: an estimated 3,000 cadre affiliated with
;ROUPS ommunTst Party of China. Beijing has publicly announced
that active recruitment will rise over the next 12 years
-- Federation of Trade Unions and Hong Kong General Chamber
of Commerce are Communist controlled
Other:
-- Hong Kong and Kowloon Trade Union Council (Taiwan
(backed)
-- Federation of Hong Kong Industries
-- Chinese Manufacturers' Association of Hong Kong
;CONOMY GDP: (1984) $31.* billion, $5,830 per capita; real growth
9.6%
Exports: $28.3 bilion (f.o.b., 1984), including 10.6
billion reexports; principal products--clothing, plastic
articles, textiles, electrical goods, wigs, footwear,
light metal manufactures
Imports: $28.6 billion (c.i.f., 1984)
major-Trade partners: (1964) demestic exports--44% US, 8%
ina,-FRG; imports--25% China, 24% Japan, 11% US dl UK, Government Consumption Expenditures: (1984) $2.4 billion
Major n us r es: textiles and clothing, tourism, electronics
plastics, toys, watches. clocks
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SOUTH KOREA: FACT SHEET
Official Name: Republic of Korea.
Population: 42,643,000 (July 1985), average growth rate 1.5%.
GNP: $81.1 billion (1984), $1998 per capita, real growth 7.5%;
projection for 1985: 6.3%.
Unemployment: 3.8% (1984); Inflation: 4.0%.
Major Industries: textiles and apparel, electronics, chemicals, steel,
ship building.
Exports (1984): $29.2 billion (36% US, 16% Japan).
Imports (1984): $30.6 billion (23% US, 25% Japan).
Foreign Debt (1984): $44 billion.
Aid Received:
-- Economic: US(FY 46-85), $11.2 billion; Japan (1965-75) $1.8
billion; other western aid, ODA, and OOF(1980-81), $1.1 billion.
-- Military: US(FY 46-83), $8.1 billion.
Central Government Budget (1985): $13.2 billion; defense 33%.
Government Leaders: CHUN Doc Hwan, President (since August 1980); LHO
Shinyong, Prime Minister (since February 1985).
Elections: Under new constitution of October 1980:
-- President elected indirectly for seven-year term by a 5000-man
electoral college; last election February 1981.
-- National Assembly elected for four-year term consists of 276
representatives, 184 directly elected and 92 chosen
through proportional representation; last election February 1985.
Political Parties:
Party
Leader
Assembly Seats
Democratic Justice Party (ruling) Chun Doc Hwan, president 148
Rho Tae Woo,
chairman
New Korea Democratic Party
Lee Min-woo,
president 102
Korean National Party
Lee Man-sup,
president 21
Democratic Korea Party
Chong Yun-Hy
ong, president 5
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SOUTH KOREA: MAJOR ISSUES
President Chun Doo Hwan has retreated from political liberalization
and is adopting hardline tactics that could provoke a backlash.
-- Chun is increasingly falling under the influence of hardliners
among his personal advisors.
-- Student dissidents are being branded pro-communist and some are
being charged under national security laws. The President is
pushing a campus stabilization law that includes re-education
camps for convicted dissident students.
-- The emergence of a potent opposition party in last February's
parliamentary elections -- the New Korea Democratic Party -- has
turned the National Assembly into a forum for heated debates on
sensitive political issues.
President Chun is trying to bolster his image at home by promoting a
statesmanlike image.
-- Seoul is engaging Pyongyang in a multi-channel dialogue.
Agreements in principle have been reached regarding reunions of
separated families and formation of an economic cooperation
committee; a joint team for the Seoul 1988 Olympics is being
discussed. We remain skeptical, however, about any early
breakthroughs.
-- Chun plans to speak at the UN General Assembly meeting
this fall and seeks a public meeting with President Reagan at
that time. Perceived United States support for Chun, however,
has spurred nascent anti-Americanism among some intellectuals.
The recent improvement in North Korea's relations with the Soviet
Union represents, we believe, a tactical adjustment in the P'yongyang-
Moscow-Beijing triangle.
-- Recent Soviet military deliveries -- including Mig-23s -- will
not destabilize the military balance on the peninsula.
-- They will, however, prompt Seoul to press for closer military
ties to Washington.
Sluggish economic growth has prompted Seoul to loosen its austere
monetary and fiscal policies in order to spur growth.
-- Government estimates of real 1985 GNP growth have been
revised downward to 6.3% from 7.5%, due to a
slump in exports -- 5 to 6% growth is likely.
-- Washington is pressing Seoul to accelerate market opening
measures that are strongly resisted by Korean businessmen and
conservative economic policymakers. Seoul is also concerned
about possible US restrictions on footwear and textiles.
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Thailand: Political and Economic Developments
Prime Minister Prem Tinsulanonda is approaching the halfway
mark of his second term in a strong political position:
--Appointed in 1980, the retired general has now remained
in office longer than any previous civilian head of
government.
In the meantime, however, the Bangkok political pot continues
to simmer. Party politics and military restiveness will periodically
increase tensions:
support of senior military officers and the monarchy.
--Prem has benefited from the Thai economy's generally good 25X1
performance during the past several years and from the
--Quarrels within the ruling coalition may prompt Prem
to reshuffle his cabinet later this year. Nonetheless,
dissidents in the ruling parties probably are not powerful
enough to to threaten government stability.
r em robabl
can continue to outmaneuver his opponents. 25X1
On the economic front, Prem is implementing a package of
reforms and belt-tightening measures to boost exports and ease
recent balance of payments problems. Despite a good overall
economic performance, Thailand's balance of payments deteriorated
sharply in 1983 and has improved only modestly since then--
largely due to slower import growth. Moreover, Bangkok is
concerned by its rising foreign debt obligations and committed to
maintaining its good international credit rating. Political
considerations, however, will limit Prem's ability to make
reforms:
more year.
--Austerity measures must be handled carefully to avoid
provoking the military, the opposition, and labor groups.
--Structural reforms--designed to improve the efficiency of the
domestic economy and increase competitiveness of Thai exports
over the longer term--may undermine the vested interests of
labor unions and politicians. 25X1
As a result, economic growth will slow this year to about 5
percent while inflation will increase moderately. However, we
expect Prem's solid power base and his rising political
confidence to enable him to weather these difficulties. Barring
an unforeseen recurrence of the health problems that plagued him
last fall, Prem appears likely to remain in office at least one 25X1
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Fact Sheet--THAILAND
People
Population: 51,724,000, average annual growth rate 1.9 percent
Ethnic divisions: 75 percent Thai, 14 percent Chinese, 11 percent
other
Religion: 95.5 percent Buddhist, 4 percent Muslim, 0.5 percent other
Government
Official name: Kingdom of Thailand
Type: Constitutional monarchy
Branches: King is head of state with nominal powers; bicameral
legislature (National Assembly--Senate appointed by King, elected
House of Representatives); judiciary relatively independent except
in important political subversive cases
Government leaders: King BHUMIBOL Adulyadej, Prime Minister PREM
Tinsulanonda, Foreign Minister SIDDHI Savetsila
Major political parties: Social Action Party, Democrat Party,
National Democracy Party, Thai Citizens Party, all coalition
members; Thai Nation Party, major opposition party
Communists: two weak insurgencies, nationwide probably total less
than 2,000
Economy
GNP: $40.6 billion, $806 per capita; 5.5 percent real
growth in 1984
Agriculture: accounts for 67 percent of total employment and about
23 percent of GDP; main crops--rice, sugar, corn, rubber, tapioca
Major industries: agricultural processing, textiles and garments
integrated circuits
Exports: $7.4 billion; agricultural commodities, textile products,
integrated circuits
Imports: $10.3 billion; machinery and transport equipment, fuels
and lubricants, base metals, chemicals, and fertilizer
US Aid: $580 million (FY70-83), including Ex-Im; military
commitments, $966 million (1970-83)
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Sincmore Fact Sheet
People
Population: 2,531,000 (July 1984), average annual growth rate 1.2%
Ethnic divisions: 76.7% Chinese, 14.7% Malay, 6.4% Indian, 2.2% other
Religion: majority of Chinese are Buddhists or atheists; Malays nearly
all Muslim; minorities include Christians, Hindus, Sikhs, Taoists,
Confucianists
Government
Official name: Republic of Singapore
Type: republic within Commonwealth
Branches: ceremonial President; executive power exercised by Prime
Minister and Cabinet responsible to unicameral legislature (Parliament)
Government leaders: YEOH Ghim Seng, acting President; LEE Kuan Yew,
Prime Minister
Political parties: government--People's Action Party (PAP) holds 77 of
79 seats in Parliament; opposition--Workers' Party (WP), 1 seat;
Singapore Democratic Party (SDP), 1 seat; Barisan Sosialis (BS); United
People's Front (UPF)
Communists: 200-500; Barisan Sosialis infiltrated by Communists
Economy
GDP: $17.9 billion (1984); $6,500 per capita GNP; 8.2 percent real
growth 1984; projected real growth for 1985 down to 2 or 3 percent
Major industries: petroleum refining and oil drilling equipment,
electronics and computer peripherals, food and beverage processing,
rubber processing and rubber products, ship building and repair, entrepot
trade, financial and information services
Exports: $27.7 billion; mineral fuels, machinery and transport
equipment, manufactured goods--especially electronic and computer
products
Imports: $23.3 billion; high-technology machinery and transport
equipment, raw materials, food, consumer products
UNCLASSIFIED
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Singapore Experiences a Rare Period of Decline
Prime Minister LEE Kuan Yew's People's Action Party won only 63 percent of
the popular vote in the December 1984 national election--down from 76 percent in
1980--and two opposition parties placed spokesmen in the traditionally single-
party Parliament.
? Taking their cue from younger Singaporeans--who question the autocratic
style of Lee--J. B. JAYARETNAM, Workers' Party, and CHIAM See Tong,
Singapore Democratic Party, have sparked debate over a wide range of
Lee has announced that he will retire from politics after the 1988 elections
--when he reaches age 65. Most Singaporeans, however, are skeptical. Cabinet is
drafting a constitutional amendment to make the ceremonial presidency an elective
office and give the president the power to veto spending of reserves accumulated
by previous governments. Moving into the presidency would allow Lee to turn over
the day-to-day overnin to a handpicked successor while retaining substantial
control.
? Three MPs in their early 40s--GOH Chok Tong, First Deputy.Prime Minister and
Minister of Defense; MG Teng Cheong, Second Deputy Prime Minister and
Secretary General of the National Trades Union Congress; and Tony TAN Keng
Yam, Minister of Education and of Trade and Industry--have survived a decade
of leadership testing by Lee and are thought to be in the running to become
? The Prime Minister's son, Brigadier General LEE Hsien Loong (Res.), 33,
handily won a seat in Parliament in December 1984--after rising to flag rank
in the Army in a short 13 years. He holds two junior ministerial posts and
may move into Cabinet within a year. As head of the newly created Economic
Committee, he is in the spotlight. Many Singaporeans assume he is being
groomed to succeed his father. 25X1
Singapore in 1985 is experiencing the most dramatic economic recession in
its 26-year history. Projected 1985 gross domestic product for Singapore is
$18.2 billion, only 2 percent above 1984. 25X1
? The economy contracted by 1.4 percent in second quarter 1985--manufacturing,
petroleum refining, and ship building and repair being hardest hit--
reflecting declining US demand for electronics products and computer
peripherals, falling world oil prices and the development of refineries in 25X1
Indonesia and the Middle East, and attempts by Indonesia and Malaysia to
develop their own shipping sectors.
scheme, and relaxed central bank regulations on investment loans.
corporate taxes, smaller contributions to the government's retirement
? The government recently has reduced property taxes and shaved fees for its
communications, transportation, and real estate services to lower business
overhead costs. Businessmen and bankers are unsatisfied, pressing for lower 25X1
up sharply, prompting unions to delay pay increases to protect jobs.
? Tourism, retail sales, and construction also are depressed. Unemployment is
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CHINA: Current Domestic Issues
Deng Xiaoping and his allies are pressing forward aggressively on key
reforms despite unanticipated problems in implementing their economic
program. September's national conference of party delegates, slated to
endorse a substantial turnover in the top leadership and lay the groundwork
for the 7th Five Year Plan, will be the political event of the year.
The party leadership faces a wide range of pressing domestic issues:
The Economy. Deng's critics have sought to use the shortcomings of
reform to slow the pace and scope of change.
-- Since early spring, the reformers have implemented market-style
adjustments as well as administrative measures to control the
inflation, drawdown of foreign exchange reserves, and excessive
industrial growth and capital construction caused by reform.
-- Partly to defuse the criticism of party old timers, Beijing is
taking steps to curb the rising incidence of official corruption.
-- Wage and price reforms remain the key to the economic program and
are being implemented gradually
Personnel Rejuvenation. Against the rearguard actions of party
traditionalists, Deng has accelerated the pace of personnel turnover in key
national and provincial posts.
-- Since April, 13 new provincial secretaries and 7 provincial
governors have been installed. Generally, the new leaders are men
and women in their fifties, approximately a decade younger than
their predecessors.
-- The obstructionist director of party propaganda was fired in July.
-- At the September party conference, Deng will attempt to stack the
Central Committee by adding some 50 new members from the ranks of
younger, pro-reform leaders. Key reformers will also be added to
the Politburo and Secretariat.
-- Beijing has publicized the "retirement" of approximately 1.1
million officials and wants to reach 2 million by yearend.
Party Reform. A party "rectification" campaign is now in its second of
three years. The drive seeks to balance traditional concerns of the party old
guard against the requirements of reform.
-- Rectification consequently is concentrating on cleaning up
official corruption--the bete noir of party veterans--while
ensuring a pro-reform membership through careful recruitment--
cooptation--of an educated elite and simultaneous purge of
politically unreliable members.
The Military. Rejuvenation and streamlining are proceeding in the
military as well but remain politically controversial. With a few important
exceptions, the military high command has undergone a major shakeup.
-- Streamlining and foreign military sales will allow modernization
in select areas that depend on access to foreign (largely Western)
technology.
-- The effect of manpower reductions probably is not as drastic as
implied by the announced cut of about 1 million men.
Succession. According to stories circulating in Beijing, Deng ultimately
intends party Secretary Hu Qili to succeed General Secretary Hu Yaobang, while
Vice Premier Li Peng reportly will replace Premier Zhao Ziyang.
-- Rumors that Deng plans to retire as Military Commission Chairman
in favor of Hu Yaobang appear premature in the light of recent
propaganda asserting Deng's continuing vigor and mental alertness.
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ur%oLRJJlr LE.U
Population:
1,041,346,000 (July 1985), average annual growth rate
of 0.9%. Labor Force: 447.1 million (December 1983
est.), 74% agriculture, 15% industry and commerce,
11% other.
Government:
Communist state; real authority lies with Communist
Party's Politburo; the National People's Congress, in
theory the highest organ of government, usually ratifies
the party's programs; the State Council actually directs
the government. Political subdivisions include 21
provinces, 3 centrally governed municipalities, and 5
autonomous regions.
Government Leaders:
President--Li Xiannian
Vice President--Ulanhu
Premier, State Council--Zhao Ziyang
Vice Premiers, State Council--Li Peng, Tian Jiyun,
Wan Li, Yao Yilin
State Councilors, State Council--Chen Muhua, Fang Yi, Gu
Mu, Ji Pengfei, Kang Shi'en, Song Ping, Wang
Bingqian, Wu Xueqian, Zhang Aiping, Zhang Jingfu
Secretary General--Tian Jiyun
Chmn., Central Military Comn.--Deng Xiaoping
Party Leaders:
Politburo Standing Committee, the main policymaking
organ of the party--Hu Yaobang, Ye Jianying, Deng
Xiaoping, Chen Yun, Li Xiannian, Zhao Ziyang
Secretariat, in charge of day-to-day administration--
Hu Yaobang, Hu Qili, Chen Pixian, Deng Liqun, Gu Mu
Wan Li, Xi Zhongxun, Yao Yilin, Yu Qiuli
Economy:
GNP--$309 billion (1984 est.), $300 per capita.
Agriculture--main crops are rice, wheat, other grains,
oilseeds, cotton
Major Industries--iron, steel, coal, machine building,
armaments, textiles, petroleum
Shortages--complex machinery and equipment, highly
skilled scientists and technicians, energy, and
transport
Exports--$23.7 billion (f.o.b. 1983); manufactured
goods, agricultural products, oil, minerals.
Imports--$18.3 billion (f.o.b. 1983); grain, chemical
fertilizer, steel, industrial raw materials,
machinery, equipment.
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Burma: Major Political and Economic Issues
The succession question--Burma's most important political
issue--was addressed at the Fifth Congress of the Burma Socialist
Program Party, held in early August:
--Ne Win retained his position as Party Chairman and de facto
leader of Burma. Barring serious health problems, we expect
him to hold the reins of power for the foreseeable future.
--President San Yu--Ne Win's longtime confidant--was selected
for the newly created post of Party Vice Chairman, firmly
establishing him as second in command and the most probable
successor to Ne Win.
Insurgencies remain Burma's major internal security
problem--although none of the groups is capable of overthrowing
the government. Because the insurgents are heavily involved in
narcotics production and trafficking, Rangoon's efforts to crack
down on them have included an aerial eradication program,
supported by US agencies. Burma nonetheless produces about 90
percent of Southeast Asia's opium.
In addition to increasing its cooperation with the United
States in narcotics control, Burma has stepped up its diplomatic
activity with other countries in the past several months. Ne Win
recently visited Beijing, where Chinese leaders assured him of
decreased support for the Burmese Communist Party. As a result,
relations between the two countries have improved.
Rangoon's most pressing economic problem remains the
country's sharp decline in export earnings:
--Rice exports, which provide 40 percent of the country's foreign
exchange earnings, may fall to half of last year's levels due to
poor quality and high prices.
--Exports of timber, cement, and urea have aggravated domestic
shortages and crimped the country's development plans.
--Cuts in imports and foreign borrowing--while necessary to control
Burma's mounting debt service ratio--have further limited the
economv's growth.
2oDM
To boost foreign exchange revenues, Rangoon plans to
diversify its exports to higher sales-value crops. In addition,
it plans to develop natural gas reserves in the Gulf of Martaban
to produce gas, urea, and ammonia for export. With a $1 billion
outlay required, however, Rangoon probably will have to accept
foreign participation in the project-- which it so far has been
unwilling to do. 25X1
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Fact Sheet--BURMA
People
Population: 36,919,000 (July 1985)
Ethnic Divisions: 72% Burman, 7% Karen, 6% Shan, 6% Indian, 3% Chinese,
2% Kachin, 2% Chin, 2% other
Religion: 85% Buddhist, 15% indigenous beliefs, Christian, or other
Government
Official Name: Socialist Republic of the Union of Burma
Type: republic under 1974 constitution
Capital: Rangoon
Political Parties and Leaders: government-sponsored Burma Socialist
Program Party only legal party; U NE WIN, party chairman (de facto
leader since 1962)
Government Leader: U SAN YU, President and Chairman of Council of State
(since November 1981)
Communists: est. 15,000 (primarily as an insurgent group on the northeast
frontier)
Other Political or Pressure Groups: Kachin Independence Army; Karen
Nationalist Union, several Shan factions (all insurgent groups)
Economy
GDP: $5.9 billion (1982/83, in current prices), $166 per capita; real
growth rate 6.5% (1982/83)
Agriculture: accounts for 64% of total employment and about 29% of GDP;
main crops-paddy, pulses, sugarcane, beans, peanuts; almost 100%
self-sufficient
Exports: $378.9 million (f.o.b., 1983); rice, teak hardwoods, base
metals, ores
Imports: $735.5 million (f.o.b., 1983); machinery and transportation
equipment, building materials, oil industry equipment
U.S. Aid (including Ex-1m): $70 million (FY70-83)
25X1
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