NATIONAL INTELLIGENCE DAILY WEDNESDAY 13 JULY 1983

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T01094R000300010172-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 27, 2016
• Document Release Date: July 19, 2010
• Sequence Number: 172
• Publication Date: July 13, 1983
• Content Type: REPORT

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Central
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CPAS NID 83-163JX
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Intelligence
Top-$eeFet -
National Intelligence Daily
Wednesday
13 July 1983
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Tog) Secret
Contents
Ell Salvador: Military Activity .................................................... 1
Japan: Austere Budget Outlined ............................................ 2
China-US: Official Optimistic About Relations 3
USSR: Anticorruption Campaign in the Military ...................... 4
USSR-France: Andropov and Marchais on INF ......................
USSR-Chad: Soviet Commentary ..........................................
West Germany-El Salvador: Appointment of Ambassador ..
Mexico: Impact of Local Election Results .............................. 8
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13 July 1983
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EL SALVADOR: Military Activity
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Government forces over the weekend began a. major sweep in
northern Chalatenango Department, and they are continuing military
operations throughout most of the country.
Army spokesmen say several towns along the key Northern
Highway already have been retaken.
The government has announced that the elite Atlacatl Battalion
has pulled out of Morazan Department and has been replaced by an
airborne unit and another battalion.
The guerrillas continue to carry out sporadic actions. Late last
week insurgent forces attacked Nueva Granada in northern Usulutan,
allegedly killing about 13 local defense troops and capturing assorted
weapons and ammunition.
Meanwhile, Joaquin Villalobos, head of one of the
largest guerrilla factions, vowed in a recently broadcast speech to
intensify the war.
Comment: The Army has held the tactical initiative for over a
month, overrunning guerrilla base camps and retaking towns long
held by the insurgents. Nevertheless, the guerrillas' losses generally
have been light.
Villalobos's warning indicates the insurgents still plan to strike
back soon. They may take advantage of the withdrawal of the Atlacatl
Battalion to hit hard in the east.
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JAPAN: Austere Budget Outlined
austerity and US demands for higher defense spending.
trying to find middle ground between domestic demands for fiscal
The government, in its initial work on the budget for fiscal 1984, is
The Cabinet yesterday instructed most ministries to cut their
budgets for the fiscal year beginning on 1 April by 10 percent. The
increase In the ceiling for defense spending, however, was put at
6.9 percent. With outlays for foreign aid, energy programs, science
and technology, and personnel also slated to grow, Tokyo hopes to
hold the growth in total spending to 1 percent.
than 3.7 percent.
Defense fared better in the bargaining than earlier reports have
suggested. The Defense Agency had asked for an increase of
8.9 percent, but the Finance Ministry had recommended no more
approach $50 billion, or about 4 percent of GNP.
projected for the current budget. The deficit nevertheless is likely to
Comment: This increase in total spending is less than the growth
ordered.
Officials in the Foreign Ministry are concerned that the projected
increase will not be enough to quiet critics in the US. The Finance
Ministry, however, will try to lower it in subsequent stages of the
budget process, which culminates in late December. An increase of
6.9 percent would barely cover the purchases of equipment already
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CHINA-US: Official Optimistic About Relations
dialogue with the USSR.
Huan Xiang, head of foreign policy research in the party
Secretariat, has told two US political analysts that he is optimistic
about relations with the US and pessimistic about prospects for a
Huan emphasized that he regarded Sino-US interests in general
as complementary and viewed Asia as a "large area where we can
cooperate." He doubted, however, that the US is interested in closer
strategic cooperation with China. Huan indicated that Chinese leaders
believe the US no longer sees China as an important strategic power
and looks instead to Japan to play that role.________________
be tactical.
In addition, Huan asserted that neither Washington nor Moscow
is willing to improve relations with China "too much" at the risk of
offending the other. He was skeptical, moreover, that Moscow is
prepared to weaken its strategic relationship with Vietnam or to pull
back its forces from the border to improve Sino-Soviet relations.
According to Huan, any change in relations with the USSR would only
technology.
Comment: Huan has direct access to Deng Xiaoping, and his
comments probably reflect the views of the senior leadership. He
presumably was trying to underscore Beijing's renewed interest in
closer relations with the US following Secretary of Commerce
Baldrige's visit last month and the US decision to liberalize the
transfer of technology to China. Huan's comments appear to be part
of a broader effort to encourage the US to demonstrate its
commitment to better ties by approving conspicuous sales of
Top Secret
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USSR: Anticorruption Campaign in the Military
anticorruption campaign in the military is being put into effect.
Several recent articles in the military newspaper Red Star
stressing the need for greater labor discipline suggest that the
the campaign.
Red Star has reported that, following the party plenum last month,
Defense Minister Ustinov complained that discipline remained
inadequate in some units. This was followed by articles by General
Yepishev, Chief of the Main Political Directorate, calling for increased
efforts to improve discipline and create a "moral atmosphere" in
every military unit. Yepishev also noted that it was time to implement
cover the bribe.
In mid-June Red Star also carried an unusual account of a general
fired for extorting bribes during an inspection. The unit's commander,
who also was fired, diverted money from a unit mutual aid fund to
Comment: The reemergence of the discipline campaign is
primarily designed to make more efficient use of defense resources
and thereby strengthen the economy. For the top military ranks, this
means assuring political leaders that military resources are being
managed effectively and honestly during a time of economic
stagnation and some popular dissatisfaction. The humiliation of a
general on grounds of corruption suggests that rank alone will not
ensure special privileges in the future.
bribery during inspections is
that such investigations are about to be carried out.
such commissions since then, but Yepishev's statement may mean
common. This is indirectly attested to by the announcement last
January in Red Star that special inspection commissions would be
established outside the military. No official mention has been made of
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USSR-FRANCE: Andropov and Marchais on INF
In a joint communique issued yesterday in Moscow, General
Secretary Andropov and French Communist Party chief Marchais
agreed that French and British forces have to be taken into account in
the INF talks in Geneva. The French press reported that Marchais did
not concur, as TASS had reported earlier, that "the main danger is
now represented by the intention of US imperialism to deploy its new
missiles in Europe." Marchais instead called for balanced arms
reductions by East and West. TASS subsequently withdrew the
disputed report, noting that the communique would be issued in its
place.
Comment: The French Communist Party's endorsement of the
USSR's insistence that French and British systems be accounted for
is a coup for Moscow. The Soviets, however, apparently
overestimated Marchais's willingness to subscribe to a direct attack
on the US position on arms issues. The Soviets also may want to
dampen any speculation in the West that Moscow is ready to drop
its insistence on accounting for British and French systems.
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USSR-CHAD: Soviet Commentary
A TASS statement issued yesterday demanded an immediate halt
to "any interventionist actions" in Chad. TASS explicitly criticized
France's dispatch of arms to Chad and accused "Western powers" of
putting pressure on African countries to become involved in an
"internal" dispute.
Comment: This is the highest level Soviet commentary to date
on the fighting in Chad. Previous statements have characterized
President Habre's government as pro-Western and reported
dissident leader Goukouni's allusions to a CIA role in the earlier
overthrow of his government. The USSR's effort to dissuade France
and others from aiding Habre and the omission of any reference to
Libyan involvement in the conflict amount to an endorsement of
Goukouni's effort to topple Habre.
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WEST GERMANY-EL SALVADOR: Appointment of Ambassador
The West German Government has announced its intention to
send an ambassador to San Salvador in the near future during former
President Duarte's visit to Bonn, but it probably will wait until after the
presidential election in El Salvador scheduled for later this year. Since
1980, West Germany has been represented in San Salvador by a
charge d'affaires.
Comment: Waiting until the election would allow the West
Germans to claim that the democratic process in El Salvador had
reached the point where full diplomatic representation was merited. If
Bonn were to send an ambassador now, the government's critics
would be more prone to claim that it was supporting a rightwing
regime guilty of human rights abuses. In addition, Bonn does not want
to move too far ahead of other West European countries on this
matter. The government also may resume development aid to
El Salvador-frozen since 1980-but any such move almost certainly
would be balanced by continuing aid to Nicaragua.
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MEXICO: Impact of Local Election Results
The blow dealt to the ruling party in the first round of the
municipal elections may cause President de la Madrid to reassess his
commitment to harsh austerity measures and to review his campaign
promise to respect local election results.
Comment: The losses follow those last year in three state capitals
and threaten the party's reputation for representing virtually all
Mexicans. If the government believes it may be defeated in even a few
key contests in the next elections, which include the contest for
governor in Baja California, it may rig some of the voting. To stem
further defections from the ranks of the ruling party, de la Madrid also
may limit scheduled reductions in government spending and
employment.
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