NATIONAL INTELLIGENCE DAILY WEDNESDAY 23 NOVEMBER 1983

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T01094R000500010011-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 27, 2016
• Document Release Date: July 22, 2010
• Sequence Number: 11
• Publication Date: November 23, 1983
• Content Type: REPORT

Director of
Central
Intelligence
National Intelligence Daily
Wednesday
23 November 1983
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Contents
Ell Salvador: Insurgent Attacks in the East .............. :............. 2
Jordan: Increased Security Concerns .................................... 3
France-USSR-Lebanon: Possible French Initiative ................ 4
Poland: Jaruzelski Increases His Power .................................. 5
Hungary: Trade Union Criticism .............. :............................... 6
West Germany: Bundestag Approves INF Deployments ........ 9
West Germany-France: Kohl and Mitterrand Meet .............. 9
UK-Lebanon: Movpment of Warships .................................... 10
Brazil: New IMF Agreement .................................................... 10
Suriname: Effort To Build Popular Support ............................ 11
Jamaica: Opposition in Disarray .............................................. 11
Yugoslavia: Budget Legislation Stalled .................................. 12
Venezuela: Refinancing Without IMF Austerity ...................... 12
Special Analysis
Israel-US: Visit of Prime Minister and Defense Minister ........ 13
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EL SALVADOR: Insurgent Attacks in the East
The government's military position in the eastern part of the
country continues to deteriorate.
The guerrillas claim they killed 12 government troops and took some
135 prisoners and 150 weapons in an attack last weekend on
Anamoros in La Union Department. The US defense attache reports
that the insurgents shelled Santa Rosa de Lima on Sunday and
attacked government garrisons in La Union City on Monday with
mortar and automatic weapons fire.
Government commanders are voicing increased concern about
the direction of the war. A senior Air Force officer recently told US
officials in San Salvador that the war effort lacks adequate direction,
coordination, and leadership. He cited guerrilla control of large areas
in eastern and central El Salvador and urged the US to persuade
Vides to make command changes, claiming the Defense Minister will
not act decisively otherwise.
Comment: The Army will have to take strong measures in the
east to prevent further losses. On the other hand, if the government
sends many units to reinforce the area, it risks more setbacks in the
central and northern regions. the guerrillas are
planning new attacks in Chalatenango as soon as government units
Vides, in considering command changes, is caught between
hardline conservative officers who want their members in key
positions and more moderate commanders who fear the growth of
rightwing influence in the military. Vides has to placate both factions
or risk further divisions in the officer corps similar to those that
unseated his predecessor earlier this year.
The insurgents want to score some decisive gains before the
elections next year.
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JORDAN: Increased Security Concerns
Government officials in Amman believe they are. increasingly
vulnerable to attacks by Syrian or radical Palestinian. groups as
regional tensions grow over the PLO crisis.
Jordanian contacts of the US Embassy in Amman also are
concerned that the probable ouster of PLO chairman Arafat and his
followers from Lebanon will ultimately spell trouble for Jordan. They
are worried that rebel PLO fighters in Lebanon, who largely insist on
armed struggle against Israel, will try to strike at Israel from Jordan.
They believe Jordan itself will then become a target as a result of its
efforts to prevent the fighters from infiltrating through Jordanian
territory.
Comment: The Jordanians have responded to the threat of
increased infiltration by imposing new restrictions on travel between
Syria and Jordan of persons holding Jordanian passports, a large
number of whom are Palestinians. Since 1980, Jordanian authorities
have experienced periodic problems with what they believe to be
Syrian-sponsored terrorist acts: The recent series of security
incidents, however, has been the most serious in more than 10 years.
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Recent French initiatives concerning Lebanon suggest Paris is
considering involving Moscow in efforts to resolve the Lebanese
problem.l
Comment: Paris probably hopes that what it views as a common
interest in restraining Syria's ambition and in the survival of an
independent PLO may make the USSR receptive to French
suggestions. France also may hope to organize a new forum for
multilateral discussions on Lebanon and may urge the US to consider
including the Soviets. At the same time, France may be seeking
Soviet backing for replacing the Multinational Force with an enlarged
UN peacekeeping contingent.
The Soviets would welcome French support for their inclusion in
either Lebanese or Arab-Israeli peace negotiations, but they probably
have no illusions that a new initiative is likely to be successful any time
soon. Moscow sees support for Damascus as its best option for
achieving its objectives in the Middle East; and it would not cooperate
with the French in any effort to put pressure on the Syrians.
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Poland: Appointments to Government
Florian Siwicki
Defense Minister
Zbigniew Messner Manfred Gorywoda
Deputy premier for economy Head of Planning Commission
Highly competent commander Party chief in Katowice . .
and staff officer . . . Soviet politically minded economist
trained . . . served as . . . reportedly a good
Jaruzelski's deputy in Ministry of administrator.
National Defense for a decade.
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Party secretary . . . profes-
sional economist . . . served
for several years in Central Com-
mittee's Economic Department.
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POLAND: Jaruzelski Increases His Power
Party leader Jaruzelski strengthened his political position and
sought greater control over unresponsive economic bureaucracies in
recent meetings of the Central Committee and the parliament.
Jaruzelski relinquished the Defense Ministery to his close ally,
General Siwicki, but he was chosen by the parliament to head the
revamped National Defense Committee. This committee is
empowered to declare a state of war or, in the case of domestic
troubles, a state of emergency.
In his speech last week to the party's Central Committee,
Jaruzelski reiterated that the road to economic recovery is long and
difficult but that there has been gradual improvement. He said that
some modifications to economic reforms are needed and that
proposed increases in food prices are necessary. Polish bishops as
well as the Solidarity underground have urged that the increases be
The parliament yesterday appointed two senior party officials to
economic portfolios. The party chief from the Silesian industrial
region, Zbigniew Messner, will become deputy premier to oversee the
economy. Manfred Gorywoda, party secretary for the economy, will
take over as head of the Planning Commission.
Comment: The meetings demonstrate Jaruzelski's continuing
focus on security matters. The new National Defense Committee is
another effort by Jaruzelski to create an institutional framework to
facilitate quick reaction to unrest. As its head, Jaruzelski could
maintain control over foreign and domestic policie even when he
eventually gives up his position as premier.
On economic matters, he only promised more of the same.
Messner and Gorywoda, who probably share Jaruzelski's cautious
approach to change, are likely to have little immediate impact on the
government's economic "reform programs." This is little more than a
collection of administrative changes.
The price increases in January probably will lead to sporadic
protests. The authorities are keeping a close watch on the public
mood, however, and are prepared to contain demonstrations.
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The increasingly open debate between the trade union leaders
and the regime probably reflects widespread worker resistance to
austerity measures to help restore financial stability.
The official radio says trade union chief and Politburo member
Gaspar acknowledged to a union delegates' meeting last week that
the lives of many families have become more difficult, implying that
the fault lies with excessive retail price increases imposed by the
government. Gaspar also indirectly criticized the extent of party
control over the unions by telling workers unhappy with the union
leadership that "factors outside the control of the movement" often
force policies on it.
Secretary of the Central Committee Nemeth, in a party plenum
speech last month, attacked union leaders for not adapting to
changing circumstances. He accused them of representing parochial
concerns of union members rather than national interests.
Comment: Factory workers have been suffering
disproportionately from government efforts to reduce domestic
consumption in order to make more goods available for export.
Workers in heavy industry, the group most dependent on union
support, have been particularly hurt, because their skills are not easily
transferable to the thriving private sector and they cannot supplement
their incomes there.
The official trade union movement in Hungary has been more
outspoken than those of other Warsaw Pact states, but this is its most
direct criticism of government policy in at least a decade. The regime
probably would like to fire Gaspar, but it may be concerned that his
removal now could endanger party chief Kadar's carefully built
domestic consensus. Kadar-who is already cautious-may become
even more hesitant to enforce austerity and reform measures that will
further erode the living standards of industrial workers.
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WEST GERMANY: Bundestag Approves INF Deployments
The Bundestag yesterday endorsed the government's policy on
INF, paving the way for Pershing II deployments to begin. The
government's resolution, which was approved by a margin of 286 to
226 with one abstention, states that deployments have to commence
because no arms control result has been achieved in Geneva,
"despite the greatest efforts of the US and its Allies." It also
welcomes Washington's readiness to continue the INF negotiations
and advocates an intensification of the East-West dialogue in all fields
in order to improve the prospects for future arms control agreements.
A resolution presented by the Social Democrats rejecting
deployments was defeated with 39 abstentions and 294 "no" votes,
including at least four by either Social Democratic or Green deputies.
Comment: The government's motion is unambiguous in its
endorsement of deployments. Voting on it appears to have been
along party lines. Former Chancellor Schmidt, former Defense
Minister Apel, and other Social Democrats who opposed their party's
rejection of deployments chose to express their dissent during the
vote on the Social Democrats' resolution rather than endorse the
government's motion or abstain.
Chancellor Kohl and President Mitterrand will discuss INF and
preparations for the EC summit next month at their semiannual
meeting beginning tomorrow in Bonn.
Comment: The two leaders probably will issue a statement
endorsing INF deployments as a necessary response to the prior
Soviet buildup while expressing their continued desire for an arms
control agreement. They almost certainly will not resolve their
differences on budget reform, financing the Common Agricultural
Policy, and other EC issues. Kohl and Mitterrand would like Europe to
appear politically united following INF deployments, however, and
they probably will emphasize their determination to achieve progress
on EC reforms at the EC summit. They also may discuss joint weapon
production projects, although they are unlikely to announce any new
final agreements.
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UK-LEBANON: Movement of Warships
The UK is sending two warships to Lebanese waters, with a third
to arrive sometime next week. The destroyer Glamorgan and the
frigate Brazen arrived yesterday off Lebanon, and the assault ship
Fearless, with its complement of 90 Royal Marines, is scheduled to
replace them at the end of the month. London is portraying the move
as a way to improve logistic support for the 100-man British
contingent with the Multinational Force in Beirut.
Comment: The British have been willing to remain in the
Multinational Force as long as casualties and expenses are not high.
Recent attacks on the French and US contingents, along with French
and Israeli reprisals, have increased London's fear of a possible
attack on its forces. Although an immediate pullout is not
contemplated, the British may remove nonessential personnel or have
off-duty troops sleep on the ships. The ships also coup ide
protection and a refuge in case of an evacuation.
BRAZIL: New IMF Agreement
The IMF's approval yesterday of a revised stabilization program
for Brazil restores critically needed foreign financial support, but the
new disbursements still leave Brasilia with an uphill economic
struggle. In return for commitments on more restrictive fiscal,
monetary, and wage measures, the IMF and foreign banks will release
frozen payments totaling $3.2 billion. Brazil also is seeking $6.5 billion
in new pledges from foreign banks.
Comment: Resumed disbursements will be barely enough to
cover Brazil's obligations to repay bridge loans obtained from the
Bank for International Settlements and foreign commercial banks.
The major portion of any new foreign bank pledges will have to be
used to clear up overdue interest and foreign payments of more than
$3 billion. Although Brazil has surmounted its immediate financial
crisis, it probably will have considerable difficulty meeting ambitious
targets the IMF has set for 1984 on inflation, the public-sector deficit,
and the balance of payments.
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SURINAME: Effort To Build Popular Support
Army Commander Bouterse will announce his "Movement of
National Unity" tomorrow at a mass rally in another effort to mobilize
popular support to legitimize his regime. According to the US
Embassy, the movement proposes a radical overhaul of Suriname's
society, politics, and economics. Religious and traditional party
leaders reportedly will not support this effort. They believe it rejects a
return to democracy and reaffirms the dominance of the military,
which has held power since 25 February 1980.
Comment: Bouterse has planned the ceremony to coincide with
Independence Day, and he will try to stir up nationalist sentiment by
blaming economic problems on the Dutch and the US. The radical
tone of his unity movement may be intended to salvage his
revolutionary credentials following the ouster of the Cubans and the
removal of some radicals from the government. Like Bouterse's past
attempts to justify his coup, however, this new pro ram is unlikely to
attract widespread support.
JAMAICA: Opposition in Disarray
The opposition People's National Party is reacting to rumors that
Prime Minister Seaga will call for general elections before the end of
the year by claiming that the government had agreed that no voting
would take place before voter registration is complete. It also is,
warning it will boycott an early election. According to the US
Embassy, the registration process is unlikely to be completed before
May or June.
Comment: Former Prime Minister Manley's party foresees a
debacle if elections are held soon. The party is in poor condition
financially and organizationally, and it has been hurt by Manley's
unpopular denunciation of the intervention in Grenada. It also has
been damaged by Seaga's charges that it was involved in subversive
activities in the region and by his harping about its close connections
with Cuba. Party moderates are trying to gain political ground by
focusing on Jamaica's economic problems, but this approach is
unlikely to have much success over the short term.
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YUGOSLAVIA: Budget Legislation Stalled
The Federal Assembly's rejection yesterday of a strict, anti-
inflationary federal budget for 1984 is a major challenge to the federal
government. The draft budget would limit federal expenditures to a
19-percent increase, not enough to satisfy the demands of some
republics. Government spokesmen warn that the draft might have to
be substantially redrawn unless agreement can be reached soon.
Comment: This is a setback to Prime Minister Planinc's efforts to
reassert federal authority and meet the expectations of the IMF and
other foreign creditors. As regional leaders continue to place local
priorities above the interests of the country as a whole, other key
economic legislation scheduled for this winter is likely to lag. The
budget deadlock increases pressure on federal party leaders to reply
forcefully or else lose face at home and abroad.
VENEZUELA: Refinancing Without IMF Austerity
Venezuela will not seek an agreement with the IMF if leading
presidential candidate Jaime Lusinchi wins the national elections in
December as anticipated. Instead, Lusinchi plans to impose limited
austerity measures to gain approval from international lenders,
according to one of his senior economic advisers. Foreign bankers
are expected to lift their earlier requirement that Caracas accept an
IMF program before $18.4 billion in foreign debt can be rescheduled,
and they are drafting a new refinancing proposal.
Comment: To encourage a consensus among lenders on
rescheduling the debt, Caracas will need to impose enough economic
discipline to keep debt interest payments current. Lusinchi probably
will be able to achieve this in the short term, because Venezuela's
balance-of-payments position has improved and it has adequate
foreign reserves. Although a rescheduling of payments without an IMF
austerity package could encourage other debtor countries to call for
greater flexibility from the Fund, few if any of the developing countries
have the reserve position that has enabled Caracas to work
unilaterally with the banks.
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Special Analysis
ISRAEL-US: Visit of Prime Minister and Defense Minister
Prime Minister Shamir and Defense Minister Arens come to
Washington next week anticipating discussions on expanded
cooperation with the US. They believe Israel is in a strong bargaining
position, and they probably will ask for action on a number of aid and
cooperative ventures in return for their agreement to consider more
active support of US regional policy. They are likely to urge the US to
put pressure on Egypt to return its ambassador to Tel Aviv, and they
plan to raise a controversial Israeli program for resettling West Bank
Palestinian refugees.
Shamir believes that the US need for Israeli support to achieve
important policy goals in the Middle East, such as the reduction of
Soviet influence and Syrian withdrawal from Lebanon, puts him in a
strong position in his talks during the visit. Recent US moves-
particularly the decision to permit Tel Aviv to use US aid funds to
develop the Lavie fighter aircraft-and the approaching US election
campaign have persuaded the Israelis that the climate in Washington
is likely to be receptive to their views and requests.
The Israelis probably hope to obtain additional US aid on more
favorable terms. Shamir has said publicly that he would devote most
of his visit to economic matters. He said that Israel has the right to
ask Washington to help in solving the country's economic problems,
because it is in US interests to assist Israel.
Finance Minister Cohen-Orgad is advocating an austerity
program to achieve his primary goal of improving Israel's balance-
of-payments position. He is calling for a real decline in private
consumption of 7 percent next year. The cabinet recently approved
tax increases and budget cuts, in addition to those agreed to in
August, designed to reduce the budget deficit by $2 billion.
Shamir's fragile government, however, almost certainly lacks the
political will to enforce an austerity program for the two to three years
that would be required to make it work. Members of TAMI, a small
party in the coalition with a low-income constituency, are opposed to
cuts in social welfare spending. Ministers have become adept at
thwarting budget cuts, moreover, by using "unanticipated" price
hikes to justify higher outlays.
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An agreement with Histadrut, the large labor organization, to
reduce cost-of-living adjustments will be necessary to curb private
consumption. Histadrut officials, knowing that Israeli governments are
extremely sensitive to unemployment, feel under little pressure to
moderate wage demands to protect jobs. Since the inflation rate
could reach 200 percent this year, Histadrut leaders will be extremely
reluctant to allow any tampering with the indexation system that has
protected Israelis from the effects of triple-digit inflation.
Additional US assistance would allow the Israelis to postpone
dealing with the balance-of-payments problem. It also could provide
some of the foreign exchange required if rising unemployment forces
the government to pursue expansionary policies.
The Israelis probably will renege on a proposal made by former
Finance Minister Aridor and ask for $1.7 billion in Foreign Military
Sales credits for FY 1985, with an increase in the grant portion. Aridor
had indicated that he would only ask for $1.3 billion in such aid if the
US would provide the entire sum as a grant, but Arens had opposed
this cut in military aid. In addition, the Israelis may ask that a large
portion of the $910 million in economic aid in FY 1984 be disbursed
early to shore up Israel's foreign exchange reserves.
Expanded Cooperation
Shamir will be cautious in approaching his discussions on closer
cooperation. He clearly would like to see high-profile combined air
and naval maneuvers and the stocking of US equipment in Israel, but
he will want to know what is expected of Israel in return. Shamir will
be reluctant to get drawn into an understanding that might require
Israel to support US objectives that it does not share.
The Prime Minister also will be cautious in discussing Lebanon.
The Israelis see continued US backing for President Gemayel's
government as crucial in deterring Syria, but they will be reluctant to
agree to a broader military commitment for Israel there. Israeli public
opinion opposes any greater involvement in Lebanon, and Shamir
probably would face difficulties with his cabinet if he tried to win
approval for any military moves going beyond retaliatory airstrikes.
Instead, the Israelis are likely to argue that the US, Israel, and
Gemayel should focus on increasing public political cooperation to
show the Syrians that they cannot dominate the Beirut government.
They will urge the US to press Gemayel to be more cooperative. Since
the signing of the Israeli-Lebanese withdrawal agreement on 17 May,
Gemayel has not met publicly with any Israeli officials.
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Shamir will resist any US effort to get him to agree to substantial
modifications in the accord of 17 May. He believes the agreement is
central to Israel's hopes for peace agreements with other Arab
countries and that its abrogation would be a major victory for Syria.
Israel may be willing, however, to consider minor modifications in the
agreement.
Egypt and the Peace Process
The Prime Minister probably does not expect lengthy discussions
of the peace process. If pressed, however, he will repeat Israel's
earlier rejection of the US peace plan and reiterate his view that the
Camp David autonomy process is the only workable approach to the
Palestinian problem.
Shamir also will urge the US to keep pushing Egyptian President
Mubarak to be more forthcoming on relations with Israel. The Israelis
believe that US pressure on Mubarak has resulted in a recent slight
improvement in ties, and they probably will exhort US officials to
continue efforts to get Cairo to return its ambassador to Tel Aviv.
An Israeli cabinet minister told US officials last week that Shamir
plans to propose a scheme for moving West Bank Palestinian
refugees out of their camps into permanent housing during his talks.
The Israelis hope that the US will provide substantial funding for the
plan-they estimate it will cost at least $1.5 billion-and help with
raising funds from international donors. West Bank Palestinians
oppose the plan.
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