NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A030300010046-4
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: December 20, 2016
• Document Release Date: August 7, 2006
• Sequence Number: 46
• Publication Date: September 7, 1977
• Content Type: REPORT

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NATIONAL INTELLIGENCE DAILY CABLE 0
Wednesday 7 September 1977 CG NIDC 77-208C 0
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National Intelligence Daily Cable for Wednesday, 7 September 1977
e NiD Cable is tor e purpose
ot i
ntorming
CANADA:
Economic Stagnation
Page 1
CYPRUS:
Race for Archbishopric
Page 4
SCANDINAVIA: Foreign Ministers
BRIEFS
Page 4
Page 5
China
Nigeria
Poland
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CANADA: Economic Stagnation
/Canadian Prime Minister Trudeau is under in-
creasing pressure to deal with the country's worsening economic
and social problems. Recent figures indicate that the economy
is continuing to perform dismally, and the persistently high
unemployment rate--now 8.l percent nationwide--has become a
major irritant in relations between the federal and provincial
governments.//
//Canada recently announced that the gross na-
iona product in the second quarter of 1977 had declined at
a 2.4-percent annual rate in real terms. The unexpected de-
cline--the third in the last four quarters--stems from a drop
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in foreign demand and continued stagnation in domestic demand.
Canadian growth now probably will fall far short of the gov-
ernment's hoped-for 4-percent target for 1977. It may be dif-
ficult to achieve even the 3.5-percent growth we recently pro-
jected.//
//The foreign sector, which was responsible for
a very respectable first-quarter growth rate, turned sour in
the second quarter, and the export volume of goods and services
declined. The depreciation of the Canadian dollar has done
little for export volume because many Canadian exporters have
maintained the same prices in US dollars to improve profits.//
//Import volume rose sharply even though domestic
demand was stagnant and import prices were rising. The increase
in volume was apparently due to stockpiling of auto parts by
Canadian assemblers in anticipation of strong US demand for
the 1978 models.//
//Domestic demand remained weak. Personal con-
sumption, which had held up well in 1976, fell in the second
quarter even though most tax payers benefited from income tax
rebates. 'The investment sector showed no sign of providing the
needed stimulus to bring the country's economy back on track.
The only bright spot was a further reduction in inventories,
which could help industrial output later this year.//
//Opposition calls for stimulative economic
measures are certain to intensify when Parliament reconvenes
in October, and Trudeau may have to give more serious considera-
tion to taking some action. In devising a stimulation package,
he will move cautiously, however, for fear of accelerating in-
flation. The government is particularly concerned about infla-
tion because it recently failed to gain labor's support for
voluntary restraints as a condition for ending wage and price
controls :before their scheduled expiration in late 1978.//
I //Inflation remains high despite nearly two
years o controls, and unemployment rates in many provinces
are at al.ltime highs with little prospect for improvement in
the short term. Public opinion polls indicate that joblessness
is considered a more pressing issue than national unity, a
view shared by many of Canada's provincial premiers.//
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 Approved
25X1 I //Trudeau has been under heavy pressure to call
ewed popularity
25X6 - I abut he probably
will do little more than ffle his cabinet this fall. A
spokesman for Finance Minister MacDonald announced yesterday
that the minister would resign at that time.
25X1
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CYPRUS: Race for Archbishopric
I Leadership of the politically influential Orthodox
urc o Cyprus is now certain to devolve on Bishop Chryssostomos
of Paphos, following the withdrawal from the race of Bishop
Chrysanthos of LimassoZ, his only chaZZenger.
Chrysanthos' decision not to run in the election to
succeed the late Archbishop Makarios came after it became clear
that support for Chrysostomos extended well beyond the early
coalition of Communists, socialists, and centrists. Chrysanthos,
who favored a reduced political involvement for the Church, en-
joyed the support of only one wing of the Greek Cypriot right.
I Chrysostomos would probably also like to succeed
Makarios as president in the February presidential election,
but the mood among Greek Cypriots is that the two offices should
no longer be held by the same man. He is therefore unlikely to
parlay his prospective ecclesiastical victory into a successful
run for the presidency.
SCANDINAVIA: Foreign Ministers
The foreign ministers of Sweden, Norway, Denmark,
Finland, and Iceland met in Helsinki Zast weekend to coordinate
their positions on international issues prior to the convening
of the UN General Assembly this month.
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 African issues, including:
The communique following the meeting emphasized
of human rights.
on the Middle East, the foreign ministers stressed
that no country should take measures which would further com-
plicate the ongoing peace efforts. The ministers also said that
potential financial savings made possible by disarmament in
industrial nations could become a factor in filling the finan-
cial needs of developing nations. They also emphasized the im-
portance of world opinion in focusing attention on violations
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--The establishment of a group to investigate bringing
broader economic pressure to bear on South Africa.
--An announcement of readiness to facilitate a peaceful
transition to majority rule in Namibia.
--The inclusion of apartheid and racial discrimination
in a list of areas for UN action on human rights ques-
tions.
The statement by Chinese Vice Premier Teng Hsiao-ping
to a group of visiting US newspaper executives in Peking yes-
terday was clearly designed to deflate any hope that China is
prepared to back away from its basic conditions for normaliza-
tion of relations with the US. Teng's remarks amount to a
strong restatement of China's long-standing position on Taiwan
and Chinese-US relations.
public relations effort designed to influence US public opinion
and build pressure on Washington to advance the pace of normal-
ization and halt what Peking seems to view as US backsliding
The most significant and unexpected aspect of this
development is Peking's decision to publicize its view to such
an extent. Teng's remarks may point to a more active Chinese
on the issue.
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Nigeria:
The Nigerian Government is holding public hearings
examining the recent foreign exchange scandal. involving some
$1.6 billion in illegal currency transactions. The investiga-
tion is apparently remaining low-key, and, according to the US
Embassy in Lagos, most observers believe that: higher government
officials who were allegedly involved are being protected.
Although more than 400 persons have been arrested, a
number of prominent suspects have been released, and the volume
of accusations against others has ebbed. The majority of those
accused are foreign businessmen, particularly Lebanese. No US
citizens are known to have been detained.
I I The US Embassy in Poland reports that there were some
shortages of flour in Warsaw and Poznan last week, but it notes
that many stores appear well-stocked and people standing in line
seem no more disgruntled than usual. The onset of good weather--
after seven straight weeks of rain--probably has helped curb any
inclination toward hoarding.
I The government has apparently brought additional
stocks onto the market both to demonstrate its ability to sat-
isfy demand and to nip in the bud any potential hoarding. More-
over, the regime continues to press its message that despite the
bad weather, supplies of foodstuffs--except for meat--will be
sufficient. Serious shortages of meat and other foodstuffs still
exist, however, and the regime will have to monitor the mercu-
rial public mood carefully. 25X1
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