NATIONAL INTELLIGENCE DAILY FRIDAY 13 JANUARY 1984

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00970R000100010039-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 25
• Document Creation Date: December 27, 2016
• Document Release Date: May 24, 2010
• Sequence Number: 39
• Publication Date: January 13, 1984
• Content Type: REPORT

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Director of
Central
Intelligence
National Intelligence Daily
Friday
13 January 1984
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Contents
Chad: Prospects for Reconciliation Talks .............................. 10
Philippines: Financial Developments ...................................... 11
International: Nuclear Exporters To Tighten Controls .......... 12
Turkey: President Vetoes Election Law .................................. 13
USSR-US: Threats of Protracted Decline in Relations ..........
1
NATO: Policy for Conference on Disarmament ......................
2
USSR-Cuba-Angola: More Soviet and Cuban Aid ................
3
France-Lebanon: Future of the MNF ......................................
4
PLO: Political Failure in Tunis ..................................................
6
Nicaragua: More Insurgent Attacks ........................................
7
USSR-China-US: Reaction to Zhao's Visit ..............................
8
Nigeria: Indecision on the Economy ........................................
9
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Soviet and East European officials, employing scare tactics aimed
at eroding West European support for INF deployments and putting
the West on the defensive at the coming Conference on Disarmament
in Europe, warned late last month that lack of progress at the
Conference would do more damage to East-West relations.
Comment: Moscow increasingly will pound away at these themes
as the Conference approaches, hoping to cause tension between the
US and West Europeans. Despite these alarmist tactics, the Soviets
are pursuing contacts with the US while awaiting any new initiatives
by Washington on arms control issues. The threat of economic
countermeasures might have some impact on those West European
countries who trade extensively with the USSR, but the Soviets
benefit from such trade and are unlikely to follow through.
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NATO: Policy for Conference on Disarmament
Ambassadors from member countries of NATO on Wednesday
failed to settle the remaining differences on the West's position for the
Conference on Disarmament in Europe.
The Allies still have not completed a package of proposals for the
notification and observation of conventional military activities. The
most contentious issue is prior notification of the transit of non-
European forces through Europe.
The UK and West Germany continue to reject compromise
language that would exempt US out-of-area activities. The number of
inspections of military activities each country has to accept and the
extent of information to be exchanged on military forces also are
unresolved.
Over the past week several Allies have expressed concern about
the effectiveness of Western strategy for countering Soviet tactics at
the Conference. According to a British official, Moscow is aware of
Allied dissension on the transit issue, and London assumes the
Soviets will exploit this.
Comment: The Allies are becoming increasingly worried that the
West's complex package lacks public appeal and that NATO may
appear to be insufficiently dedicated to reducing East-West tensions.
Most Allies, especially West Germany and France, are likely to urge
the West to offer proposals on nonuse of force and for constraints on
conventional military activities, in order to counter expected Soviet
initiatives. They also may want to discuss how to deal with an
anticipated Soviet proposal at the Conference for a ban on chemical
weapons in Europe.
The US probably will find itself isolated on the transit issue if the
USSR proposes including transits in notification requirements. Most
Allies believe that this is a legitimate confidence- and security-
building measure. They will emphasize that the credibility of the West
will suffer if it insists on a loophole that obviously benefits the US.
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USSR-CUBA-ANGOLA: More Soviet and Cuban Aid
The Soviets and the Cubans, during unusual trilateral
consultations with Angolan representatives in Moscow on Wednesday,
apparently agreed to strengthen Angola's defenses against South
Africa.
TASS has reported that officials-who were not identified-of the
three countries had discussed the Angolan situation in light of the
South African offensive. As a result of the meeting, the USSR and
Cuba reportedly agreed to provide aid for Angola "to strengthen its
defensive ca abilit ."
Meanwhile, South African Defense Minister Malan told the US
Charge yesterday that South African conventional forces would be
withdrawn from Angola in seven to 14 days. Malan noted, however,
that reconnaissance units would remain in southern Angola.
According to the
Angolan Ministry of Defense, South African aircraft bombed the town
of Caiundo on Tuesday.
Comment: The trilateral meeting is the latest indication that
Moscow and Havana intend to provide expanded backing for
Luanda's military effort. The failure of the TASS report to identify the
participants may indicate that top Soviet leaders were not involved.
The injection of any substantial number of Soviets into Angola
remains unlikely, but additional Cuban personnel will be required,
particularly to operate sophisticated weapons systems.
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The French fear that the Multinational Force will have to pull out of
Beirut in the next few months, and they want to coordinate an orderly
withdrawal.
The French Ambassador in Washington recently said that, if the
situation in Beirut is not resolved in two or three months, public
opinion in the contributing countries and Syrian intransigence will
force withdrawal of the MNF. Paris would like to see the contributing
countries take coordinated actions to replace the MNF with a UN
force. It fears that if this is not done soon, the participants will have to
withdraw their contingents in disarray.
Moreover, a senior French diplomat has told the US
Embassy in Paris he believes that Lebanese public support for the
MNF has dissipated, that President Gemayel's government has lost
its credibility, and that the MNF will be completely withdrawn in three
months.
The French press has reported that Paris allegedly has decided to
withdraw from the MNF. It also has noted the government's anxiety
about the timing of the anticipated US withdrawal and the prospect of
being left "holding the bag" in Lebanon.
Comment: President Mitterrand probably believes that the MNF
has outlived its usefulness, and he may be concerned that the US or
Italy will withdraw precipitously. Paris almost certainly believes that
coordination among MNF contributors will help to reduce the political
repercussions that will inevitably be characterized by some as a
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PLO Chairman Arafat has been unable to reconcile his differences
with other key PLO leaders, although he retains grudging support from
a majority of the members of his own Fatah organization.
The 55-member Fatah Revolutionary Council yesterday issued a
resolution denouncing the actions of Syrian-backed PLO dissidents
who fought Arafat in Lebanon and endorsing recent decisions of the
Fatah Central Committee. The Central Committee had criticized
Arafat for not consulting with other PLO leaders before his meeting
with Egyptian President Mubarak, but it refrained from condemning
the substance of the meeting.
Comment: Arafat might want to break with PLO dissident
leaders, but he needs the support of the influential Democratic Front
for the Liberation of Palestine and Popular Front for the Liberation of
Palestine. The two organizations had tried to mediate between Arafat
and the Syrian-backed dissidents during the fighting in Lebanon.
They also favored retaining Arafat as PLO chairman-although with
restricted authority.
Since Arafat's meeting with Mubarak, however, both groups have
called for his removal. Failure to come to terms with them could cost
Arafat the chairmanship or the Arab League mandate to act as sole
representative of the Palestinians.
In addition, some members of the Fatah Central Committee still
resent Arafat's meeting with Mubarak and are generally dissatisfied
with many of Arafat's policies. Before Arafat makes his next move in
the peace process, he will have to adhere more closely to the principle
of collective leadership.
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NICARAGUA: More Insurgent Attacks
The anti-Sandinista insurgents' overall strategy apparenty
includes the use of dramatic operations to attract publicity.
The Nicaraguan Democratic Force claims it sank one of
Nicaragua's French-built patrol boats at Potosi on Sunday. A source
of the US defense attache claims that little damage resulted from a
raid the previous day against installations at Masachapa.
Earlier this week the insurgent group also announced that it has
mined the entrance to Puerto Sandino in a further attempt to damage
the Nicaraguan economy. A spokesman for the guerrillas said Lloyds
of London has been notified of the mining so that it would warn ships
not to use the port.
Managua has announced that a battalion of national
police is being sent north to help with the harvest. Press reporting
states that a 41-man Cuban team arrived earlier this month, along
with other international groups, to assist with the sugar harvest near
Bluefields.
Comment: The insurgents probably hope their recent flurry of
attacks will convey an impression of growing momentum. Although
the raids along the coast apparently have caused little damage, they
should help improve insurgent morale and supply some short-term
propaganda gains. The tactical situation in the interior seems to be
at a stalemate, with both sides recording gains and losses.
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Soviet reporting on Premier Zhao's visit to Washington suggests
that the Soviets are concerned about the recent warming in Sino-US
relations but still hope for movement on the Sino-Soviet dialogue.
A TASS report on Wednesday attacked President Reagan and
Secretary of State Shultz for "distorting" the USSR's Asian policy
during the talks and for making "trite claims" about Soviet military
superiority. It said Zhao did not react to the President's call for
"mutual strategic plans and commitments," but reported that Zhao
had noted that the importance of Sino-US relations exceeds normal
bilateral ties. Earlier Soviet reporting on the visit had suggested that
Washington was currying favor with Beijing by offering economic
concessions, but it did not characterize China's response.
A recent article in a leading Soviet academic journal by a
prominent specialist on Sino-US relations concluded that the US and
China had, by mid-1983, arrested the decline in relations prompted
by President Reagan's initial stand on Taiwan. It said Beijing and
Washington subsequently laid the groundwork for a further
improvement in ties, and it predicted additional progress in that
direction during Zhao's visit and the President's planned trip to China
in April. It also stated that there are limits to this process, however,
because Beijing remains more cautious than it was in the late 1970s
about working in concert with the US on world issues.
Comment: Moscow is worried about the renewal of high-level
exchanges between Washington and Beijing, but the Soviet media are
treating China as the more reserved partner in the dialogue. The
Soviets want to avoid a simultaneous weakening of their bargaining
position in both capitals.
The Soviets have stepped up public criticism of Chinese foreign
policy in recent weeks. They are unlikely, however, to engage in
unrestrained polemics with Beijing as long as they see some
possibility for progress in the Sino-Soviet consultations.
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NIGERIA: Indecision on the Economy
The government of Head of State Buhari appears to recognize the
seriousness of Nigeria's economic problems, but its failure to
announce a specific recovery plan or to name a cabinet is contributing
to a growing sense of indecisiveness.
The government is continuing to round up civilian politicians and
is detaining relatives of some key lieutenants of former President
Shagari who are now overseas in order to force their return to Nigeria.
The Army has begun an extensive series of changes in command
assignments, amid reports of an increase in low-level military
harassment of civilians.
The Chief Justice told the US Embassy that the country is
operating in a legal void because the military has not indicated what
sections of the constitution of 1979 are still in effect. He sees serious
legal difficulties ahead, especially if the government moves to
prosecute former civilian officials.
Widespread military reassignments probably will weaken
authority and create hard feelings among some officers. The
likelihood of plotting among field-grade officers will increase as senior
officers assume administrative responsibilities and leave command of
the brigades to majors and lieutenant colonels.
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CHAD: Prospects for Reconciliation Talks
The reported breakdown of OAU-sponsored talks in Addis Ababa
may lead to renewed hostilities and could portend more Libyan
meddling.
A communique released by the OAU today said the talks had
collapsed, according to press accounts. The US Embassy in Addis
Ababa reported that the negotiations that convened on Monday were
stalled over procedural disputes and rebel leader Goukouni's demand
that he meet with President Habre rather than the stand-in
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as president of a separate Chadian state.
Zairian officials are concerned that the explosion of a bomb in the
luggage of four Chadians at Kinshasa airport this week was related to
Zaire's support for Habre.
Comment: The Libyans and dissidents almost certainly will blame
the breakdown on Habre for failing to attend. To erode Mobutu's
support for Habre, Libyan-supported Chadian dissidents may
increase sabotage activities against Zairian targets.
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PHILIPPINES: Financial Developments
President Marcos yesterday named a new head of the Central
Bank, but negotiations with the IMF are stalled because of
disagreement on exchange rate policy.
Jose Fernandez, who heads one of the 10 largest banks in the
Philippines, was appointed as the new governor of the Central Bank,
replacing Jaime Laya. Fernandez has an excellent reputation in the
international banking community and among local businessmen.
Marcos is resisting the IMF's demands for a floating exchange
rate, and the IMF team left Manila yesterday without reaching
agreement on preliminary actions needed to secure a new
$650 million balance-of-payments standby program. The team
expects to return to Manila in two weeks for more discussions.
The President reportedly is concerned about the political impact of
further depreciation before the National Assembly elections in May.
The 12-bank advisory committee on rescheduling Manila's
commercial debt met in New York on Tuesday. It agreed to
recommend to Manila's smaller commercial creditors that the
moratorium declared in October on principal repayments be
extended another 90 days.
Comment: Laya's management of the Central Bank came into
question following the disclosure that Manila had overstated its
foreign exchange holdings by as much as $600 million in order to
maintain foreign credit lines. Marcos probably believed that a change
was needed in order to restore Manila's credibility during sensitive
financial negotiations with the commercial banks and the IMF.
Marcos's refusal to accept more flexible exchange rate
management, however, could further delay receiving critically needed
new financing. At a minimum, the IMF director will have to approve
the new standby program before bridge loans from the US and other
bilateral donors will be approved to tide the Philippines over until its
debts are rescheduled. Commercial financing and debt rescheduling
also will be delayed.
The longer the stalemate continues, the more serious will be the
impact on the economy. It is already experiencing severe contraction
because of the devaluation in October and the lack of adequate trade
financing.
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Members of Non-Proliferation Treaty Nuclear Exporters Committee*
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INTERNATIONAL: Nuclear Exporters To Tighten Controls
The major nuclear supplier countries hope to conclude an
agreement later this month to extend export controls over centrifuge
technology-a process that can be used to enrich uranium to
weapon-grade levels.
Nuclear exporting countries that are party to the Non-
Proliferation Treaty will meet in Vienna on 24 January to add items
relating to centrifuge technology to the list that specifies safeguards
for sensitive nuclear components. Concerns over the proliferation risk
associated with this advanced uranium enrichment process were
raised in the late 1970s, following discovery of Pakistan's theft of
centrifuge technology from Western Europe. Subsequently, the UK-
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items to the list.
In a related initiative, a group of Western nuclear suppliers will
gather in Vienna on 17 January to continue discussions on new
controls for reprocessing technology, which is used to extract
plutonium from nuclear waste.
Comment: The two meetings are a major breakthrough in the
effort to broaden the consensus among nuclear suppliers about the
need for export controls. Japan and several West European gov-
ernments have long been reluctant to inhibit or restrict the private
sector.
The Soviets have stated they support additional restrictions on
centrifuge-related items. If they are asked, they probably will support
additional controls over items related to reprocessing technology.
France, which is not party to the Treaty, has been active on an
unofficial basis in the supplier discussions and is likely to honor any
agreements reached in Vienna.
India, Argentina, and other developing nations that are hostile to
additional restrictions on nuclear trade probably will condemn what in
their view are illegitimate actions by a cartel of nuclear suppliers.
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President Evren's veto yesterday of the National Assembly's local
election law could lead to his first political struggle with Prime Minister
Ozal.
Evren responded to objections by both major opposition parties
by returning the bill to the Assembly for "technical reasons." It will go
to committee for review and then to the full Assembly for another
vote.
If the law is passed again unchanged, the President will be
constitutionally required to implement it. If the Assembly revises the
bill, however, Evren again can choose either to carry it out or return it
to the legislative body.
Comment: Evren and Ozal probably had an early tacit agreement
to proceed with the original bill on local elections. In the meantime,
however, Ozal's political opponents inside and outside the Assembly
began charging that portions of the bill gave unfair advantage to
Ozal's Motherland Party. This opposition seems to have played a role
in changing Evren's mind.
By vetoing the bill, Evren may hope to help prevent Ozal from
adding to his political base by making substantial gains in the local
elections. Evren may even see his veto as an attempt to restrict the
number of parties participating in the elections.
Ozal now has to decide quickly whether he will resist Evren and
the combined opposition. If he does, he probably would win in the
Assembly, but his delicate relationship with Evren could be damaged
seriously. Even if he does win, moreover, the law almost certainly
would then be subject to a lengthy challenge in court.
If Ozal does not fight back or a compromise bill can be agreed to,
his political relationship with the more powerful President would not
be seriously damaged. He would still be able to pursue long-range
economic reform and major foreign policy initiatives without the
immediate likelihood of interference from Evren.
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Romania has proposed bilateral discussions with the USSR on
"reducing the number of missiles in Euro e "
The Romanians
have suggested that Deputy Foreign Minister Dolgu visit Moscow later
this month or in February, but the Soviets have not yet responded.
Dolgu visited Moscow last November for talks on INF and later held
similar discussions in Washington. The Romanians have publicly
criticized both INF deployments in Western Europe and Soviet plans
for counterdeployments in Eastern Europe, and they have called on
the two sides to return to the Geneva arms talks.
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Comment: The Romanians may hope to come up with new INF
proposals acceptable to Moscow that could lead to a resumption of
the Geneva talks. Romania's "compromise" proposals to date
generally have supported the Soviets' position, but they apparently
have encountered little enthusiasm in Moscow. The Soviets reportedly
have been particularly annoyed by the implication in Bucharest's
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