NATIONAL INTELLIGENCE DAILY TUESDAY 18 OCTOBER 1983

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T01094R000500020051-4
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 27, 2016
• Document Release Date: July 27, 2010
• Sequence Number: 51
• Publication Date: October 18, 1983
• Content Type: REPORT

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Central
Intelligence
leaseeret
National Intelligence Daily
Tuesday
18 October 1983
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Contents
Israel: Increasing Economic Pressures .................................. 1
Grenada: Radicals Taking Control .......................................... 2
USSR: Fuel-Air-Explosive Weapon ..........................................
Uruguay: Problems With Transition Process ..........................
Pakistan: Political Dialogue Begins ........................................
Chile: Improved Atmosphere for Talks ..................................
West Germany: Anti-INF Protests ..........................................
West Germany-Saudi Arabia: Decision Against Tank Sale ..
USSR-Eastern Europe: Annual CEMA Session ....................
Hungary: Impending Political Reforms ....................................
Special Analysis
Israel-Lebanon: Tel Aviv's Policy in Southern Lebanon ........ 11
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18 October 1983
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1 18 October 1983
ISRAEL: Increasing Economic Pressures
the agreement yesterday on a new finance minister.
Public doubts remain about the ability of Prime Minister Shamir's
new government to handle the country's economic problems, despite
Press reports indicate that the Herut Party's Yigal Cohen-Orgad
has been named to the post. Members of the Liberal Party who
threatened to leave the government if he were chosen have agreed to
the appointment. Observers speculate that the Liberals received
assurances of an additions cahinet-leveL7 other senior position in
exchange for their support.
trading on Sunday.
Israelis continue to purchase US dollars and other foreign
currencies, with the black-market exchange rate exceeding the
official rate by at least 5 percent. The government has delayed
collection of value-added taxes because many firms that had put their
excess cash in stocks are unable to sell them. The Tel Aviv stock
exchange, which has been closed for almost two weeks, reportedly
will reopen for bond transactions on Thursday and resume share
vote that may take place today or tomorrow.
The protracted haggling in the government over the choice of a
new finance minister has further undercut Shamir's political position.
His government, however, is expected to weather the no-confidence
in the cost-of-living formula and lowering of living standards.
the task by demonstrating public determination to fight adjustments
Comment: It will not be easy for Cohen-Orgad to get the
necessary cabinet support for required austerity measures. The two-
hour strike last Sunday by 70 percent of the labor force complicates
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GRENADA: Radicals Taking Control
least for now, but his unpopularity portends further instability.
Former Deputy Prime Minister Coard appears to be in control
power struggle is under way.
The state radio, according to an unconfirmed press report,
announced yesterday that Coard is in command of the ruling party,
with Bishop remaining as prime minister in a nonpolitical capacity.
The US Embassy reports that Army Commander Austin said in a
lengthy broadcast that Bishop has been suspended temporarily from
the party pending the outcome of an investigation into the Prime
Minister's "misdeeds." Official statements continue to deny that a
Coard's leadership, despite his unpopularity.
Comment: The radical faction's control of the radio, its apparent
backing by the officer corps of the armed forces, and Bishop's
absence indicate that Coard now holds the upper hand. The generally
apathetic population is unlikely to offer any sustained resistance to
emerges
Although both Bishop and Coard have strong ties to Cuba,
Havana almost certainly is alarmed by the prospect of political
instability in Grenada, its closest Caribbean ally. In addition, the
power struggle in Grenada tarnishes the leaders there and opens
opportunities for Western charges that Havana is involved. The
Cubans apparently are not openly choosing sides until a clear winner
islands.
If Coard ousts the moderate elements from the party, his hardline
Marxist orientation probably will result in increased political
indoctrination of the populace, an expanded role for the military in
carrying out the revolution, and moves toward nationalization. A
radical regime also might reduce Grenada's existing ties with the
West and intensify efforts to spread the revolution to neighboring
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USSR: Fuel-Air-Explosive Weapon
The Soviets have developed a system of using fuel-air explosives
to kill heavily protected troops.
the Soviets have used a
multiple-rocket launcher system to bracket a target area with rockets
that rupture and form a cloud about 1,000 meters above the target.
Another rocket is fired into the cloud as it descends and mixes with
air. This causes the mixture to detonate, which creates devastating
pressure on the target area.
This method solves problems encountered by those countries
that use a single rocket to disperse and ignite the fuel. The single-
rocket system delivers only a small amount of fuel and has problems
in dispersing it at the correct altitude. In the Soviet technique, a large
Comment: This weapon produces conditions similar to those
found in accidental natural gas or dust explosions. By developing a
workable delivery system for fuel-air explosives, the Soviets have
added another weapon system that under proper weather conditions
would he PffPCtivP fnr attacking targets distributed over a large area.
In US tests, fuel-air-explosive weapons have blown open the
hatches of armored vehicles, and casualties presumably would have
resulted inside the vehicles. Troops protected from fragmentation
munitions by bunkers, foxholes, caves, or body armor can be killed by
the large blast overpressures caused by such weapons. In
Afghanistan different versions fuel-air losives have been used
from helicopters. F
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URUGUAY: Problems With Transition Process
President Alvarez's maneuvering to stay in power after the
scheduled transition to civilian rule in 1985 reduces prospects for an
early resumption of negotiations on the constitution.
The major political parties have reacted by issuing a manifesto
condemning these actions and calling for immediate restoration of
freedom of speech, which has been limited by a government ban
since August. Moderate politicians, however, have privately told US
Embassy officials that they would like to get the dialogue back on
Comment: Alvarez has long been known to harbor personal
political ambitions, and he and his hardline backers are likely to
continue to exploit uncertainty in the military council over how to
proceed with the transition. Alvarez probably will continue efforts to
prolong the process and increase the military's uncertainty to improve
his presidential prospects.
Although moderate civilian politicians are anxious to keep the
door open to negotiations, they will have to appear responsive to their
antimilitary constituencies or lose support to the more militant
antigovernment opposition. As a result, they are likely to approach
the renewal of the dialogue cautiously.
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PAKISTAN: Political Dialogue Begins
Press reports state that a top military adviser of President Zia met
on Sunday with an important moderate leader in the opposition
coalition to solicit his views on negotiations with political opponents
and possible changes in government policy. The US Embassy says Zia
earlier met with a moderate religious party leader and has hinted at
the possibility of talks with other opponents. The opposition remains
uncompromising, demanding an end to martial law and early national
elections.
Comment: Zia probably is seekin the cooperation of some
members of the o osition.
(Further talks will be difficult and
prolonged, as opposition leaders explore the extent of Zia's flexibility
while protecting their own position.
CHILE: Improved Atmosphere for Talks
The moderate tone of the protests last week is likely to improve
the prospects for renewed dialogue between the government and the
opposition, but progress will be slow. The largely leftist-organized
demonstrations were not as violent or as broadly supported as
generally expected. The US Embassy reports that activity was limited
even in the normally volatile universities and the poorer districts of
Santiago and the provincial cities. Middle class neighborhoods also
were quiet.
Comment: The diminished violence probably will enable the
democratic opposition-which did not participate-to resume talks
with the government during the next few weeks without jeopardizing
its credibility with the public. The decline in the protest movement
probably will strengthen President Pinochet's inclination to use the
dialogue to delay the transition to civilian rule. Interior Minister Jarpa
and other more conciliatory government figures will try to persuade
Pinochet to take specific actions toward the transition.
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Anti-INF Protest Sites
.BRUSSELS
North Sea
Belgium
France
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Kilometers
The final borders of Germany have
net been established and some other
boundaries are not necessarily authoritative.
.18 October 1983
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Press reports state that demonstrations last weekend in the
Nordenham and Bremerhaven areas, at Ramstein Airbase, and in
West Berlin attracted fewer participants than organizers had
predicted. After discussions with police, protesters blockading the US
barracks at Bremerhaven agreed to allow some military vehicles to
enter the compound. iolence-prone
groups were discourage by e elaborate preparations made by the
authorities. Organizers of the protest at Ramstein failed to attract
enough people to blockade the airbase.
demonstrations are planned in major cities.
Comment: Some danger of violence by small groups remains, but
the radicals' inability to incite large-scale rioting or to destroy military
property in their Bremerhaven stronghold suggests that such activity
may be rare in other areas. Leaders of the peace movement are
hoping that the reduced turnout last weekend-caused in part by bad
weather-is not a precedent for next Saturday, when the biggest
and the West Germans do not expect them to raise the issue during
discussions in Bonn later this year on Saudi equipment needs.
WEST GERMANY-SAUDI ARABIA: Decision Against Tank Sale
A West German diplomat in Saudi Arabia has told a US Embassy
official that Bonn has decided not to sell Leopard 2 tanks to Saudi
Arabia. The diplomat says Bonn does not really want to sell the
Saudis any military equipment, despite pressure from West German
industry, and it believes that a smaller arms package will be easier to
defend politically. The Saudis reportedly are aware of the decision,
Comment: West Germany may be prepared to discuss the sale of
infantry fighting vehicles, antiaircraft systems, or naval equipment.
The decision against Leopard 2 tank sales will not affect Saudi armor
procurement plans, which center on the purchase of US-built M-1
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USSR-EASTERN EUROPE: Annual CEMA Session
The annual CEMA meeting of Soviet and East European premiers
opens today in East Berlin. The meeting reportedly is to set the stage
for the long-delayed CEMA summit that Moscow has been urging and
that could take place during the next few months. A senior Bulgarian
official says the summit was made possible by an agreement to
discuss longstanding differences on a bilateral basis only.
Comment: The principal disagreements over further economic
integration are unlikely to be resolved at this session. The East
Europeans have been generally successful thus far in resisting Soviet
initiatives that would curtail their contacts with the West. The
communique from the Warsaw Pact Foreign Ministers' meeting last
week, for example, stressed the commitment to carry out the
measures contained in the Madrid CSCE document, which call for
increased East-West cooperation.
HUNGARY: Impending Political Reforms
The party Central Committee decided on Thursday to abolish as
of next January all district administrative units, which form the middle
level in the, local government hierarchy. This measure is designed to
decentralize decisionmaking on local issues and cut costs. The US
Embassy estimates that the move will eliminate some 3,500 party and
government jobs. Earlier this year the party decreed that each village
elect its own council and that all seats in local councils and 90 percent
of those in the next national parliament-to I in 1985-be
contested by at least two candidates.
Comment: These reforms could lead to a democratization unique
among.the Soviet-dominated countries in Eastern Europe, although
much will depend on the degree of choice the regime offers to voters
and on how much power and responsibility it transfers to elected
bodies. Under the best of circumstances, the reforms will be
circumscribed by the leadership's desire to move cautiously and to
heed Moscow's concerns. The reforms also may meet with
conservative resistance, particularly because many orthodox party
members who have moved out of the central annaratus in recent
years will lose their current jobs.
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Special Analysis
ISRAEL-LEBANON: Tel Aviv's Policy in Southern Lebanon
The Israelis have concluded that prospects for a strong central
government in Beirut that would be willing to implement the agreement
reached in May are remote. As a result, they are preparing for a long
stay in southern Lebanon. Tel Aviv's policy is centered on building
good relations with the majority Shia population there in hopes of
creating a stable security situation that will permit a further reduction
of troop strength. This policy is running into difficulties, however,
largely because the Shias are becoming more resentful of Israeli
occupation practices. This development probably will force Tel Aviv to
adjust its policies in the near future.
Tel Aviv o es to establish aood relations with the Shias in southern
Lebanon. the majority of the Shias share
Israel's concerns about Palestinian infiltration and appear willing to
work with the Israelis in preventing the PLO's return to the area.
To permit an eventual further drawdown in their troop levels, the
Israelis also are trying to expand Major Haddad's Christian militia
while creating new militias among the local Sunni and Shia
populations. Haddad's force, which is the strongest and best
equipped in the south, is mannin checkpoints and augmenting Israeli
security patrols.
Haddad's forces are too small to assume broad policy functions,
however, and. most of the southern Shias resent them. Recent Israeli
threats of an imminent withdrawal to the Zahrani River probably were
intended to prod the Sunnis in Sidon to accept Tel Aviv's offer to
organize a militia under their auspices.
Growing Resentment
Many of the Shias initially welcomed the Israeli invasion as a
means of eliminating the Palestinian presence in the south, but their
attitude toward the Israelis has changed. An increasing number of
southern Shias now endorse the anti-Israeli stand adopted by the
Shia Amal movement based in Beirut. Following the arrest of
prominent Amal members by Israeli authorities in June, most Shias
participated in several protest strikes.
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officers are reviewing all judicial actions taken by local courts.
required to obtain Israeli approval for their budgets, and Israeli
Much of the Shia resentment is caused by what appears to be
growing Israeli military involvement in day-to-day aspects of life.
According to press accounts, for example, Lebanese villages are now
local products.
Israeli economic policies in the south also have contributed to the
alienation of Shias. Israeli businessmen have marketed farm products
and other goods in Lebanon at prices far below those of comparable
Lebanon
In addition, public bus routes now operate between northern
Israel and southern Lebanon, and Haifa is open to Lebanese
merchants as a duty-free port. Lebanese businessmen have
denounced these moves as an attempt to make the south dependent
on Israel and to sever the links between northern and southern
the Shias in Beirut and of the Shia clerics in Iran.
The Shias in the south probably are resigned to an Israeli
presence, but they are unlikely to cooperate as fully as Tel Aviv
expects. They are susceptible to the anti-Israeli pronouncements of
The shooting of two prominent pro-Israeli Shias in southern
Lebanon during the past three months will dissuade other Shias from
collaborating openly with the Israelis. The clash over the weekend
between the Army and Shia demonstrators in An Nabatiyah will add
network connecting the strongpoints to the Golan Heights.
Security Situation
The Israelis have nearly completed construction on a series of
strongpoints along the Awwali River and the western slopes of Jebel
Baruk that allows them to control access from the Shuf with a force of
less than 1,300 troops. They also are continuing work on a series of
interlocking strongpoints in the Bekaa Valley and a high-speed road
The network probably will be completed by the end of the year.
The Israelis then will be able to hold their positions in Lebanon
indefinitely with as few as 8,000 troops.
violence as the Israelis adopt harsher measures.
Meanwhile, Israeli casualties from terrorist attacks continue to
mount despite the withdrawal from the Shuf. Although the frequency
of attacks has decreased, growing resentment by local Lebanese in
the southern coastal area is likely to result in an increasing spiral of
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The Israeli Army already is putting pressure on Prime Minister
Shamir's government to close the Awwali River bridges to vehicular
traffic from the north in order to control arms smuggling and car
bombs. Tel Aviv does not want to give the impression that it is
implementing de facto partition, however, and is unwilling to close the
bridges.
The Israelis would like to withdraw completely from Lebanon, but
they see little hope of doing so now. They believe such a move would
jeopardize the security of northern Israel and would hand Syria a
major victory.
Tel Aviv also is concerned about the expansion of the Syrian and
PLO presence in southern Lebanon. It is unlikely to undertake further
unilateral withdrawals without corresponding pullbacks by Damascus
and the Palestinians.
Although the public clearly is tired of Lebanon, most Israelis
reluctantly support the government's policies and appear willing to
tolerate small numbers of casualties as long as the Syrians and the
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