NATIONAL INTELLIGENCE DAILY THURSDAY 12 JANUARY 1984

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00970R000100010035-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 28
• Document Creation Date: December 27, 2016
• Document Release Date: May 24, 2010
• Sequence Number: 35
• Publication Date: January 12, 1984
• Content Type: REPORT

Director of TOP 69911191
Central
Intelligence
National Intelligence Daily
Thursday
12 January 1984
CPA NI 25X1
12 anuary 1984
Copy
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Top Secret
Contents
Lebanon: Reservations About Security Plan .......................... 1
Suriname: Appeal by Bouterse .............................................. 3.
North Korea-South Korea-US: Proposal for Talks ................ 4
Nicaragua: Response to Amnesty .......................................... 5
Poland: Church-State Talks .................................................... 6
Greece: Possible Cabinet Changes ........................................ 7
Hungary-USSR: Placating Moscow ........................................
USSR-Vietnam: Delivery of Naval Equipment ........................
Yugoslavia: At Odds With the IMF ..........................................
Senegal: Impending Purge of Ruling Party ............................ 10
Belize: Cabinet Shakeup .......................................................... 10
Special Analyses
Jordan: Hussein and the Palestinian Issue .............................. 11
Malaysia: Prime Minister Under Pressure .............................. 14
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Toro Secpet
Top Secbet
J Ash
Shuwayfat
WiR Gaon
"\ Foute
12 January 1984
Vest East
Beirut Beirut
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LEBANON: Reservations About Security Plan
Army commander Tannous has expressed his concern about the
plan from a military standpoint, and President Gemayel may share his
views for political reasons.
The growing reservations have focused new attention on an Army
offensive designed to secure the Alayh ridgeline and the infiltration
route leading to southern Beirut. The US defense attache in Beirut
reports that General Tannous objects to the plan because it would
spread the Army too thin.
Tannous also is reluctant to leave the infiltration route under the
control of the predominantly Muslim Internal Security Forces, which
he considers inept. He reportedly stated that, by 20 January, he will
have four tank battalions ready to cut the infiltration route and close
the gap in the Alayh ridgeline.
Comment: Both Gemayel and Tannous probably fear that
successful implementation of the security plan would lead to the
premature withdrawal of the Multinational Force contingents.
Consolidation of government control over southern Beirut and the
area west of the Alayh ridge would enable Gemayel to bargain with
the Druze and Muslim opposition from a position of strength.
Government leaders also may believe that an offensive would
encourage Western support.
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12 January 1984
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SURINAME: Appeal by Bouterse
Army Commander Bouterse, in an appeal to workers on Tuesday,
claimed that the strikes were over and guaranteed military protection
for those wanting to return to their jobs.
Bouterse warned the "small group" of malcontents to stop
intimidating those who want to return to work and denounced the
strikes as intolerable. He said that military intervention was necessary
to restore order at the Suralco bauxite plant. The plant's managers
shut down smelting operations on Tuesday, according to the US
Embassy.
The Embassy also reports that some workers returned to the
plant yesterday without incident. At the Suriname Power Company,
however, pamphlets were distributed containing political demands
and threats of another strike by electrical workers. This caused the
government to take over the company, and military units yesterday
also occupied electrical stations in Paramaribo and at the bauxite
plant.
Comment: Bouterse probably hopes his tough talk and show of
force will be enough to induce strikers to return to their jobs. The
majority of the strikers do not want to return to work, despite
Bouterse's characterization of them as being swayed by a small group
of instigators. Positive popular reaction toward the strikers-although
not open-is likely to have encouraged the workers to hold out for
their demands.
It will take Suralco at least a month to resume production at
prestrike levels. This will deal a serious blow to the economy, which
depends on the aluminum industry for 80 percent of its export
earnings and more than 20 percent of government revenues
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NORTH KOREA-SOUTH KOREA-US: Proposal for Talks
North Korea's proposal for tripartite talks on Korea, although a
dramatic shift in tactics, largely reiterates its longstanding policy
aimed at achieving US troop withdrawals.
P'yongyang yesterday formally proposed talks involving North
Korea, the US, and "South Korean authorities." It wants to discuss a
peace agreement with the US, the withdrawal of US forces from South
Korea, a nonaggression pact between the North and South, and other
matters desired by the US and South Korea. P'yongyang stated that,
following the tripartite talks, the conditions would be created for a
dialogue between the two Koreas on eventual reunification.
Beijing has promptly endorsed the proposal, but Seoul has not.
Although South Korea does not rule out multilateral talks, it continues
to insist that it is first necessary to reduce tensions through direct
North-South contacts. As an initial step, it demands an apology-
either formally or informally-for the bombing attack in Rangoon,
which killed many South Korean leaders.
Comment: This is the first time North Korea has said it is willing
to accept South Korea as an equal participant and an open agenda. A
less detailed proposal for "unconditional talks" with the US was made
through the Chinese in October and again in December.
The timing-coinciding with Premier Zhao's visit to
Washington-suggests that P'yongyang wants to ensure that its
interests are considered in any Sino-US discussions of Korean issues.
The initiative also is part of P'yongyang's attempt to limit the damage
to its diplomatic position that has resulted from the bombing. The new
proposal is an effort to portray the North as the "reasonable" party
and to put the onus on the US and South Korea if talks fail to
materialize.
China's support for the North's proposal suggests Beijing would
prefer to remain on the sideline for now. The Chinese probably also
regard their endorsement as a relatively cost-free gesture of solidarity
with P'yongyang.
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Tot) Secret
'de
Managua
Lago de
Nicaragua
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Miskito refugee camp raided
by border-crossing
Sandinista troops?
/Kiwas Tara'
ounaary reputation is
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NICARAGUA: Response to Amnesty
Efforts by the Sandinistas to reduce international criticism by
offering amnesties to Indians and insurgents are backfiring. 25X1
Misura Indian insurgents say Sandinista troops crossed the
Honduran border last week in an effort to coerce recently arrived
refugees to return to Nicaragua. When the attempt failed, the troops
killed several Indians.
A proregime Nicaraguan religious group recently went to Costa
Rica to persuade refugees there to return. The refugees responded by
publicizing demands that the government first begin talks with the 25X1
insurgents.
International refugee officials, meanwhile, have told the US
Embassy in Managua that only a few dozen refugees in Costa Rica
and Honduras have applied for amnesty. The Sandinistas have not
claimed a specific total of returnees, but they say that some 300
insurgents in the northwest have accepted the amnesty.
. Despite earlier
promises, the Sandinistas have not yet allowed refugee officials to
visit Nicaragua's Caribbean coast to verify that the Miskitos are free
to leave. A UN representative has told the Embassy that he would not
accept an invitation, fearing Sandinista manipulation of the visit.
Comment: The difficulties with the amnesty will add to the public
relations problems the Sandinistas experienced last month, when a
Catholic bishop accompanied a group of Miskitos fleeing to
Honduras. The Sandinistas probably are exaggerating insurgent
defections, and they are likely to encounter increasing problems in
accounting for the lack of response to their alleged generosity.
Nicaragua probably hopes that Honduras and the Misura will
reject a repatriation agreement and that they will be blamed for the
lack of response. The regime is likely to make additional efforts to
involve international agencies, hoping they will give more credibility to
the amnesty.
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POLAND: Church-State Talks
The meeting on 5 January between Cardinal Glemp and Premier
Jaruzelski suggests that the church-state dialogue is unlikely to
resolve any outstanding issues soon.
A senior official of the church told US Embassy officers on
Tuesday that he is confident that the 11 Solidarity and Workers'
Defense Committee leaders will not be tried, even though there has
been no breakthrough in talks with the regime over their release. He
believes that the regime wants to avoid the embarrassment of a
public trial but that it is concerned the union leaders and their
advisers may resume their political activities if they are released
unconditionally.
The official also said he accepts the government's assertion that
it is holding only 45 convicted political prisoners. The regime also
admits, however, that approximately 170 people are awaiting trial for
alleged political crimes.
In addition, the official stated that the government's relations
with the Vatican are improving, but he advised that this does not
necessarily mean full diplomatic ties would be established soon. He
believes that, although negotiations over the church's plan to aid
private agriculture are proceeding, the regime's insistence on
maintaining some control over the funds would alienate Western
contributors.
Comment: The regime probably will not release the Solidarity and
Committee leaders in the near term without some guarantee from
the church that they will not resume political activity. The church,
however, cannot give such a guarantee. The committee activists are
Marxists who may not follow the advice of the church.
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GREECE: Possible Cabinet Changes
The recent resignation of Deputy Foreign Minister Varfis probably
reflects broader strains within the government.
The US Embassy reports that Varfis's decision to step down has
prompted renewed speculation about imminent changes in the
Cabinet. Prime Minister Papandreou
wants to shift some key ministers and relinquish the Defense portfolio.
He recently appointed Deputy Defense Minister Drossoyiannis as
Comment: Papandreou, in delegating some duties to
Drossoyiannis, probably is trying to get more time to spend on the
serious economic problems that appear to have eroded his
government's popularity. The inflation rate is about 21 percent,
unemployment stands at 8 percent, and the growing external debt is
beginning to worry Greece's creditors. The recent passage of an
expansionary budget and incomes policy will make these problems
A reorganization of the Cabinet would underscore Papandreou's
desire to strengthen the government's declining standing and might
foreshadow an early national election. National Economy Minister
Arsenis and several key Socialist leaders apparently believe little can
be done soon to reverse economic trends. They have urged
Papandreou to hold a parliamentary election in conjunction with
elections for the European Parliament in June.
Changing some ministers also could offer Papandreou a way of
curbing the infighting among them, a problem that has hampered the
government's performance. Varfis, for example, probably believed
that Arsenis's recent decision to demand a 10-month extension of EC
restrictions on the export of selected trade items to Greece will harm
Greek-EC relations.
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HUNGARY-USSR: Placating Moscow
Hungarian
dipiumais nave been o to curtail contacts wit esterners in order
to allay suspicions amon Budapest's ngary is leaning
too far to the West. the Central
Committee plenum as mon took a hard line toward the US and
advocated closer coordination with other Warsaw Pact members on
policy toward the West. At party leader Kadar's direction, mass
demonstrations protesting NATO's INF policy were held throughout
the country in mid-December and the regime has increased its
criticism of the West. Nonetheless, Hungarian officials continue to
stress privately their desire for good relations with the US, and Kadar
will host summit talks with British I and West German leaders
in the next few months.
Comment: The Hungarians will try to protect their ties with the
West, but pressures for greater solidarity with their allies may make
this increasingly difficult. They probably hope greater verbal support
for the USSR on INF and other international issues will allow them to
avoid more tangible measures
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USSR-VIETNAM: Delivery of Naval Equipment
the USSR has
de ivere two a ya- -c ass frigates to Vietnam. Two others were
delivered in 1978. The light frigates are about 80 meters long and
carry two twin 76-mm guns, antisubmarine rockets, and torpedoes.
Comment: The Petyas are the largest and most advanced vessels
in the Vietnamese Navy. They are used for coastal patrols and are a
primary defense against Chinese submarines. Since 1978, the USSR
has helped Vietnam steadily improve its ASW capabilities. In addition
to the four Petyas, the USSR has provided
helicopters, and amphibious aircraft.
YUGOSLAVIA: At Odds With the IMF
The US Embassy in Belgrade reports that negotiations between
the IMF and Yugoslavia on a standby agreement for this year have
little prospect for completion before the IMF team departs on
Monday. The IMF's insistence that Belgrade raise interest rates
substantially is the major obstacle. Several other points of contention
also have to be resolved, including IMF demands that Belgrade lift the
freeze on prices by March. A senior IMF official believes these
problems will delay approval by his headquarters of a standby
Comment: A setback in reaching agreement with the IMF will
delay refinancing agreements with bank and government creditors.
Nonetheless, eventual agreement is likely because there probably is
some room for flexibility on both sides on interest rates and because
the IMF appears willing to compromise in some areas. At the same
time, some hardliners in the government insist that Belgrade has to
be prepared to do without IMF cooperation in case the negotiations
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SENEGAL: Impending Purge of Ruling Party
President Diouf is
planning to purge powerful officials from the ruling party this month.
The US Embassy reports that the pro-Western leader believes
senior party officials are undercutting his authority, paraly 4ina the
government, and working against economic reform efforts
Comment: Diouf probably has the power to remove corrupt party
officials and would receive public support for such a step. Students,
labor, and Muslim leaders are becoming more dissatisfied about the
country's economic decline, however, and Diouf increasingly will be
blamed for the effects of austerity measures he imposed in August.
Moreover, separatist unrest broke out again last month in the isolated
Casamance Region. Senegal's military has remained aloof from
politics, but divisive political wrangling in the face of economic
hardship is likely to provoke grumbling in the officer corps and
perhaps lead to coup plotting.
BELIZE: Cabinet Shakeup
Prime Minister Price has made changes in the cabinet following
his party's recent defeat in municipal elections, hoping to halt the
increasing factional divisions. A government announcement states
that the leader of the party's right wing-who was blamed for the
electricity blackouts that caused the election loss-has been
transferred from Energy to a less important ministry. The leftist
Minister of State has had Home and Foreign Affairs added to his
portfolio. Price has not yet replaced his Deputy Prime Minister, who 25X1
retired-reportedly for health reasons.
Comment: Price's reallocation of cabinet posts favors the leftists.
It will not fundamentally alter the balance of power favoring the
conservatives, however, unless Price takes the unlikely step of
naming a leftist as his deputy. The moves probably are a warning to
both party factions, particularly the rightists, to stop their public
bickering before the campaign for national elections gets under way
this year. The conservatives may initially protest the changes, but this
is unlikely to do serious damage to party unity.
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Structure of Jordan's Parliament
National Assembly
Council of Notables
(Senate)
Consists of
30 members
appointed by King
Council of Represem,tat eiv
(Lower House)
Consists of
0 elected members R,
-30 East Bank Jordanians
-30 West Bank Palestinians
a Only 46 members of the last elected parliament (1967) are
still alive-22 East Bank Jordanians and 24 West :Bank
Palestinians; but only 14 members of the latter still reside
on the West Bank.
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January 1984
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Special Analysis
King Hussein's decision to reconvene parliament last Monday
after a 10-year hiatus lays the groundwork for closer relations with
West Bank Palestinians. The move may be designed to test whether or
not West Bankers, the PLO, and moderate Arab states will support the
King if he chooses to reassert Jordan's claim to represent the
Palestinians. Hussein apparently hopes that expanded political ties
between the two banks will improve his stature as an alternative
spokesman for the Palestinian people.
Hussein is likely to view his success in drawing all of the old West
Bank members of parliament to the opening session in Amman as an
encouraging sign of West Bank independence, particularly at a time
when PLO chief Arafat's own consultations in Tunis are still going on.
West Bankers, however, probably are more concerned with
protecting their interests in council discussions on such matters as
financial support to the municipalities than they are in asserting their
independence from moderate PLO leadershi
Israel's willingness to permit West Bankers to travel to Amman
suggests that Tel Aviv wants to encourage Hussein's efforts to gain
West Bank support for possible negotiations without PLO approval.
The Israelis probably want to send a positive signal to Hussein before
his meeting with Arafat, in hopes that the King will proceed
independently if he fails to reach an accommodation with Arafat.
An easing of restrictions by the Israelis on West Bankers could
influence Hussein to move toward negotiations. Before doing so,
however, he would make sure of moderate Arab backing and West
Bank support.
Hussein will watch regional reaction to parliament's revival in
order to determine the limits within which he can deal with the
Palestinian issue. Both the Syrians and radical Palestinian groups
have been predictably negative, accusing the King of trying to usurp
the PLO's legitimate role.
Arab moderates have been extremely reticent. Their silence casts
doubt on press reports that Hussein previously had coordinated his 25X1
plans with them.
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The King did not receive moderate Arab backing last spring for
his declaration that Jordan would no longer be bound by the Rabat
decision if the PLO came under Syria's subjugation. As long as
Arafat's position is uncertain, the moderate states probably will
hesitate to support Hussein-at least openly.
Domestic Implications
Hussein has presented his recall of parliament largely as a
domestic issue in order to reduce to a minimum an unfavorable Arab
reaction to the move. Many Jordanians have come to resent their
exclusion from political life, and they have pushed for a greater role in
decisionmaking.
Political parties have been banned in Jordan since 1957. The
lower house of parliament is the only body composed of elected
representatives. It was dissolved in 1974, soon after the Arab Summit
in Rabat named the PLO the sole legitimate representative of the
Palestinians
In 1978 a National Consultative Council, a quasi-legislative body
of appointed officials, was established. It has proved an ineffective
substitute.
The return of parliament has raised the issue of national elections.
One of the first items on the agenda was the passage of a
constitutional amendment to allow for elections only on the East
Bank.
The current requirement for simultaneous elections cannot be
met because of the Israeli occupation. Instead, West Bank
representatives are to be appointed.
For security reasons, the government may hesitate to hold
elections on the East Bank. If they are held, demographic changes
over the last 17 years will require extensive reapportionment of seats.
The recall of parliament and the possibility of national elections
gave Hussein the opportunity to remove Prime Minister Badran
without appearing to bow to domestic pressure. Badran had been in
office almost continuously since 1976 and was extremely unpopular,
particularly with the key Bedouin and Palestinian communities. The
new Prime Minister, however, is widely regarded as unsympathetic to
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Hussein is unlikely to challenge PLO legitimacy in the near term
by undertaking a unilateral peace initiative. Arafat's extrication from
Tripoli as a weakened but still popular leader of the Palestinian
refugee population compels the King to try to work out an
accommodation with the PLO.
If Hussein fails, he would still need to gather explicit West Bank
and moderate Arab support before he would even consider such a
move. In addition, he would want assurances from the US and signs of
Israeli flexibility before accepting the risks of acting without the PLO.
Recent terrorist attacks on Jordanians by Syrian-supported radical
Palestinian croups also will tend to make him proceed cautiously
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Special Analysis
MALAYSIA: Prime Minister Under Pressure
Prime Minister Mahathir, who arrives in Washington next week, is
in his most vulnerable political position since he took office in 1981.
His abrasive style of leadership, a confrontation with the King, and
economic problems have stimulated opposition in his party and might
reduce his willingness to compromise on economic issues with the
US. To strengthen his standing, he will seek increased US private
investment n Malaysia and adjustments in US economic policies.
Mahathir's rapid rise in the political hierarchy, combined with an
aggressive personality and a tendency to promote younger party
members to important positions, have earned him enemies within his
party, the United Malays National Organization. His major political
opponent, Minister of Finance Razaleigh, has made common cause
with the party's conservative wing, which dislikes Mahathir's abrupt
style and his refusal to seek the traditional Malay consensus before 25X1
introducing important issues.
Although Mahathir's campaign to reduce the King's constitutional
powers was ended by a compromise last month, it has intensified
conservative opposition to the Prime Minister. As a result of the
dispute, the US Embassy reports that Mahathir is widely viewed as
insensitive to the political and cultural role of the hereditary royalty. 25X1
Public support for Mahathir also is being reduced by economic
problems. Drastic cuts in economic development expenditures
resulting from attempts to shrink the large budget deficit threaten the
implementation of the New Economic Policy. The policy was created
to reduce foreign and ethnic Chinese control of the economy in favor
of ethnic Malays.
In addition, Mahathir has to contend with a major banking
scandal involving Bank Bumiputra, the financial arm of the New
Economic Policy. Early last year it was disclosed that the bank's
wholly owned subsidiary in Hong Kong had made large, unsecured
loans to three property speculators in the colony. Much of the
money-estimated at more than $700 million-has been lost as a
result of the collapse of the property market in Hong Kong.
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Moreover, the trial of a property developer in Hong Kong this year
may produce revelations that will implicate officials at the highest
levels of government. The officials include cabinet members close to
Mahathir.
Economic Shopping List
Mahathir will try to use his visit to the US-as well as stops in
Canada, Switzerland, and France-to strengthen domestic support
for his policies and to seek the resources needed to carry out the New
Economic Policy. In his meetings with US businessmen, Mahathir will
stress investment prospects in Malaysia and explain that his "look
East" policy-which patterns the country's economic development
along Japanese and Korean models-does not mean that the country
In Washington, Mahathir almost certainly will focus on bilateral
economic issues. As the world's largest producer of rubber and tin,
Malaysia seeks US support for UN-backed commodity agreements
designed to stabilize commodity prices.
Mahathir also wants an increase in the US import quota for
Malaysian textiles. The textile agreement with the US will be
renegotiated later this year.
The major irritant in bilateral issues-GSA sales of tin from the
strategic stockpile-was reduced with the signing of the US-ASEAN
memorandum last fall. Mahathir, however, is likely to continue his
push for commodity producer cartels.
Mahathir views himself as an economic spokesman for
developing countries. He has accused the West, particularly the US,
of maintaining an international economic system that discriminates
against developing countries by keeping the prices of commodities
low and the prices of imported manufactured goods high. As a result,
he is likely to push for a modification of US economic policies, which
he believes are keeping interest rates high worldwide and threatening
the global economic recovery.
Foreign Policy and Defense
Mahathir's discussions of other issues will be more amicable.
Kuala Lumpur has been moving closer to the US position on many
East-West issues because it believes the USSR is posing a greater
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Mahathir appreciates US support of ASEAN's efforts to resolve
the Kampuchea conflict. According to the Embassy, he will seek
Washington's views on the future of Sino-US relations.
Malaysia also is increasing its defense cooperation with the US.
Combined military exercises began in 1982, and last year 13
exercises were held
In addition, Malaysia looks increasingly to the US for the training
of military personnel. The Embassy expects Kuala Lumpur to agree to
granting US P-3 surveillance planes expanded access to Butterworth
Air Force Base.
Mahathir's Political Prospects
Any further loss of public support will encourage Mahathir's
opponents in UMNO to challenge him at the party assembly in May.
Razaleigh and the old guard are likely at least to try to dislodge Musa
Hitam-Mahathir's close ally and probable successor-from his
position as deputy leader of UMNO.
Barring damaging revelations tying Mahathir to the banking
scandal, the Prime Minister should be able to retain political control.
He is likely to be forced to give way to the opposition in some areas,
however, by placing more of the conservative party officials in
government and party positions. To renew his Malay credentials, he
also may push for greater Islamicization of Malaysian society.
In addition, Mahathir may adopt a tougher nationalist position on
international economic issues. For example, he might advocate a new
international financial order favorable to Third World countries.
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16 12 January 1984
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