NATIONAL INTELLIGENCE DAILY THURSDAY 10 OCTOBER 1985

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 0005500150
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 24
• Document Creation Date: June 24, 2015
• Document Release Date: September 9, 2010
• Case Number: F-2007-00450
• Publication Date: October 10, 1985

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 Japan-China: Foreign Ministers' Talks
Portugal: Postelection Maneuvering
Lebanon: Selling US-Supplied Equipment
Belgium: Terrorists Threaten To Disrupt Elections
Egypt-UN: Resolution on NPT at General Assembly
Argentina: Labor Challenging Alfonsin
South Korea-Japan: Contacts Between Opposition Figures.
Angola: Implications of the Government Offensive
Pakistan: Struggling Toward Civilian Rule
 Track of the Achille Lauro
Cyprus
Larnaca~ /~- _,~ y ~Tarlus
Tripoli
/ Lebanon
1500 hours
7 October
M,
,~(~exa Cis
8 October ?k
/ / Beirut
/ / Damascus
1930 hours / / Syria
IV
/
Dropped anchor
0300 hours
Port Saida 9 October
Egypt
~'op-Secre
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i\1
Tel AvW Yalo. ti 1
West *Amman
L Bank' j
;Jerusalem
 According to an announcement by the Egyptian Foreign Ministry, the
hijackers were remanded to the custody of the PLO and then taken to
in the terms for their surrender.
The terrorists surrendered to PLO authorities in Port Said, Egypt,
yesterday, but one
passenger-an American-was killed during the hijacking. Cairo
reportedly guaranteed the terrorists passage out of the country
Egyptian Foreign Minister Meguid said ;here were four hijackers, but
their affiliation has not been confirmed.
Comment: Syrian-backed PLO groups would have had strong
motives for staging the attack. They want to discredit Arafat and
derail the peace process and would have seen this as a particularly
opportune time, given the scheduled meeting between British Foreign
Secretary Howe and a joint PLO-Jordanian delegation next week.
Arafat probably did not sanction or encourage this attack because
Italy is the PLO's strongest West European supporter. Moreover,
Arafat almost certainly would rather attack Israeli targets directly.
in Tunis was unwarranted.
Arafat has been able to capitalize on the incident to enhance his
international stature by playing a mediating role in the hostages'
release. He presumably hopes his efforts will help convince others-
particularly Washington-that he peeks peace in the Middle East and
will reinforce his contention that Israel's attack on PLO headquarters
Egypt agreed to free the hijackers to end the incident quickly and
avoid a replay of the violent, protracted TWA hijacking last July. The
Egyptians also wanted an early settlement to avoid negative publicity
that would hurt PLO's international image and efforts for peace
negotiations.
Prime Minister Craxi, Foreign Minister Andreotti, and Defense
Minister Spadolini reportedly disagreed on how to handle the
situation. All three will be relieved that the ordeal has ended, but the
decision to grant free passage to the hijackers will anger some
elements of the governing coalition. Spadolini and his Republicans
are likely to be particularly unhappy, and, during the parliamentary
debate over the government's handling of the incident, Craxi may find
 Japan's Trade Balance With China, 1980-85 a '
-2.0 1980
" Quancrh data.
81 82 83 84 85
 JAPAN-CHINA: Foreign Ministers' Talks
In talks that begin today, Beijing will emphasize its commitment
to good bilateral relations but will press visiting F9reian Minister
Abe on trade and other bilateral economic issues.
The Chinese have been expressing increasing irritation over Japan's
large and growing trade surplus with China and have accused the
Japanese of dumping and of exporting poor quality products. Deng
Xiaoping last month lectured visiting Japanese businessmen on
China's unwillingness to accept a long-term deficit,
technology transfer and invest in more joint ventures.
University students in Beijing and Xian last month seized on Prime
Minister Nakasone's ceremonial visit in August to Japan's Yasukuni
war memorial to protest an alleged Japanese economic invasion of
China and resurgent militarism. A low-key media campaign preceding
the student demonstrations gave renewed publicit rit9pq
committed during the Japanese invasion of China.
Comment: The atmosphere in Sino-Japanese relations has soured
considerably since Nakasone and Chinese Communist Party General
Secretary Hu Yaobang exchanged visits over a year ago. Chinese
reformers have been especially sensitive to the Sino-Japanese trade
imbalance since the revelations last spring of China's large foreign
exchange shortfall and the heated internal debate over management
of the open-door policy. Nonetheless, both sides have overriding
strategic and economic interests in maintaining solid bilateral
relations and will work to limit difficulties. Beijing has curtailed anti-
Japanese activity and is unlikely to withdraw its support for Japan's
gradual military buildup.
Abe probably will convey reassurances from Nakasone that his shrine
visit does not reflect militaristic sympathies. On economic issues, the
Japanese Foreign Minister will offer no significant new commitments.
4W 70
 W
Portuguese Parliamentary Election Results
Total seats: 250"
Democratic Reform
Party 45
Center
Democrats 20
 Social Democratic leader Anibal Cavaco Silva probably will form
a weak minority government by early next month, and outgoing
Socialist Prime Minister Mario Soares is likely to remain as
Cavaco Silva has said he will try to use the parliamentary plurality he
won last Sunday-30 percent of the vote and 86 of the 250 seats-to
form a minority government by early November. Snares, meanwhile,
Comment: Cavaco Silva probably will become the next Prime
Minister. His Social Democrats finished well ahead of the Socialists,
the conservative Center Democrats, and the new left-of-center
Democratic Reform Party, as well as the Communists. Apart from the
Communists, who won only 37 seats, none of these rival parties is
eager to accept blame for denying Cavaco Silva a chance to govern
and for prolonging the political paralysis that followed the collapse of
Nonetheless, the campaign caused unusually hard feelings among
party leaders, and Cavaco Silva is unlikely to secure cooperation from
the Center Democrats despite agreement with them on many issues.
The other parties-especially the Democratic Reform Party-
probably will impose tough restrictions on Cavaco Silva in return for
permitting him to form a cabinet, and the new government is not likely
to be more than a weak caretaker until a new parliamentary election
after the presidential election in January.
Soares almost certainly wants to turn his energies to his presidential
candidacy and to disassociate himself from his now discredited
administration. President Eanes, however, has final constitutional
authority for appointing prime ministers, and he is likely to move
slowly to sanction a new government, both because of his cautious,
deliberate nature and because of his reluctance to help Soares-long
a bitter opponent.
0
 money to buy the spare parts they need.
Logistic personnel in the Lebanese Army are selling spare parts
supplied by the US and other foreigners to independent arms dealers
whose clients may include factional militias or Iran and other foreign
buyers. that two-
thirds of the Army's spare parts have been sold to entrepreneurs on
the open market and the remaining items have been consigned to an
emergency stockpile. Several brigade commanders complained
about the shortages to the Army commander last week, saying that
they have had to sell nonessential items on the open market to raise
the US-made spare parts.
Comment: The equipment being sold probably includes spare parts
for US-made wheeled or tracked vehicles, including the M-113 APC.
Equipment seized from Palestinian weapons caches in West Beirut in
recent years may also be involved. Iran would be a likely customer for
Top-Cccret-
10 October 1985
 BELGIUM: Terrorists Threaten To Disrupt Elections
The Communist Combatant Cells terrorist group, in a communique
following the 8 October bombing of a Brussels gas company building,
announced its intention to disrupt next Sunday's parliamentary
elections. Belgian police are taking the threat seriously and anticipate
more attacks this week and on election day
Comment: The group, which emerged In Belgium last October, has
bombed two domestic political targets but has concentrated its
attacks on NATO-related facilities. This new campaign suggests the
terrorists are now focusing on domestic issues. Because of the
group's limited capabilities, it probably could not conduct the kind of
bombing campaign that could affect the coming elections.
Egypt is considering the introduction of a resolution at the UN
General Assembly taking note of the unanimous endorsement of the
Nuclear Non Proliferation Treaty by the recent Review Conference
held in Geneva, the Egyptians
do not feel strongly about the proposal, but, if they do present it, they
want it adopted by consensus. The Egyptian Ambassador to the UN
Comment: The introduction of this resolution at the UN would again
focus attention on contentious issues that arose in Geneva--some of
which required arduous, last-minute negotiations to resolve. The
decision on whether to offer the resolution will be vexing for Cairo.
Egypt would welcome the opportunity to highlight the role of its
Ambassador In the success of the NPT Review Conference but
recognizes the possibility that failure to achieve consensus on such a
resolution at the UN could undercut the results of the conference.
Tat, secret--
41F W&
 Organized labor is intensifying Its attack on President Alfonsin's
economic austerity program and is becoming the President's major
adversary. Argentina's labor federation recently replaced a group of
mostly moderate leader;; with a dynamic secretary general eager to
confront the Government over rising unemployment and falling wages.
the Labor Minister and Economy
for wage increases. Meanwhile, the austerity program has reduced
the Inflation rate for September to 2 percent-the lowest in over a
Comment: The unions will probably stage numerous protest
demonstrations and urge the Peronist opposition party to get tough
with the government over economic questions. Alfonsin may provide
a modest wage hike that will not jeopardize the overall austerity
package. He will probably resist union demands for massive job-
creating projects; they would unleash inflation and risk alienating his
middle-class constituency before the con ressional elections on
3 November
SOUTH KOREA-JAPAN: Contacts Between Opposition Figures
A meeting last week between South Korean opposition figure Kim
Young Sam and Japanese Socialist Party Chairman Ishibashi has
drawn fire from President Chun's ruling Democratic Justice Party.
Party spokesmen have suggested that Kim's effort to promote ties
between the opposition New Korea Democratic Party and the
Socialists, who up until now have dealt exclusively with P'yongyang,
may be unlawful. Kim's invitation to Ishibashi caught leaders of the
New Korea Democratic Party off balance. Some have berated Kim-
not formally a party member-for seeking to dictate party policy.
Comment: The attack on Kim reflects anger over his antigovernment
comments in the US and his breakthrough in expanding contacts with
the Socialists-but stops short of demanding legal actions. This
suggests that Chun may have been persuaded that arresting Kim
would only rally the now-divided opposition. If the New Korea
Democratic Party disavows Kim's initiative, it will set back Ishibashi's
efforts to moderate his party's policy toward Seoul and keep stride
with efforts of the Liberal Democratic Party to promote the inter-
Korean dialogue. The Chun government may interpret Ishibashi's
proposed visit In January as opening the way for some future LDP
move toward P'yongyang and may block the trip.
 Americas - Press reports Dominican Republic arrested retired Air Force
general as alleged mastermind of cocaine trafficking ring ... other
police, military personnel under investigation ... first evidence of
military involvement in international trafficking.
- Largest Uruguayan opposition party working with government to
discredit leftist senator demanding trials of military officers on
human rights abuses ... establishment politicians increasingly
worried about calming issue, military
- Venezuela willing to help Guatemala overcome etroleum
shortage, deferred
payments, new loans may ease situation roug end of year ...
 working visit . .
conference bef
Three Gorges Dam project on China's Yangtze River ... US,
Japan also interested in project ... debate in Beijing over dam's
Gorbachev will stay on after
- The Netherlands has notified UN it will withdraw UNIFIL
contingent on 19 October ... convinced peacekeeping role in
Lebanon no longer relevant ... token unit will remain to symbolize
Attorney General arguing delay will anger public.
Tayyib may start next week ... charged with treason for role In
evacuating Ethiopian Jews from Sudan ... Prime Minister,
- West German officials acknowledge preliminary talks on building
ammunition plant worth $3 billion in Saudi Arabia. . . underscores
Bonn's interest in lucrative Mideast military trade and Riyadh's
0
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 Special Analysis
ANGOLA: Implications of the Government Offensive
The Angolan military's much improved performance in the
offensive this year against UNITA insurgents underscores the
more direct role Soviet advisers have had in planning and
directing combat operations. UNITA has been knocked off. stride
and requires more direct support by South Africa. Foreign
support probably will become increasingly important to both the
government and UNITA
Government forces dealt UNITA its first significant reversal since the
group expanded operations in 1982 to secure more territory. Since
July, the government captured Cazombo and nearly took Mavinga-
190 miles (300 kilometers) northwest of UNITA's headquarters in
Jamba-until driven back last month by South African airstrikes.
Cazombo gave UNITA access to the border with Zaire and was a
support base for northern operations. Mavinga, the first sizable town
UNITA captured, was the site of its party congress in 1982 and a way
station on supply lines to the north.
Expanded Soviet involvement in planning and directing Angolan
combat operations, together with greater Angolan use of tactical air
support, were key factors in Luanda's gains. Failure to make much
headway against UNITA last year probably led Moscow to conclude
that a more direct Soviet role was necessary this year. By midyear,
large numbers of Soviet aircraft delivered in 1984 were in operation,
Luanda used Cuban pilots and a
growing
support
Soviet arms shipments have increased since 1983 apparently in
reaction to UNITA's capture of Cangamba, a major government
defeat that shocked Luanda and caused Moscow to redouble its
military support. Soviet deliveries from late 1983 throughout 1984
included more than 100 fighters, fighter-bombers, and helicopters,
plus additional air defense weapons, various armored vehicles,
artillery, and other materiel. The Angolan Army has a full range of
conventional weapons; the insurgents remain lightly armed.
R
 The Soviets are likely to continue their extensive advisory assistance
in combat operations, and Moscow probably will provide more air
defense weapons and radars in hopes of deterring South African
actions. Additional fighters and helicopters may also be delivered.
Luanda probably believes its better performance can be repeated,
and it may even start the offensive earlier than usual next year. Future
military strategy no doubt will be addressed during the party congress
stand and fight again.
A more direct Soviet or Cuban role in Angolan air or ground
operations in response to future South African intervention on
UNITA's behalf cannot be ruled out. Apart from replacing UNITA's
equipment losses and resorting to commando operations, there is
little Pretoria can do-short of direct intervention-to prevent Angola
from repeating its success in the next offensive if UNITA decides to
Although not beaten, UNITA leader Savimbi probably will have to cut
back on semiconventional operations, and he is sure to seek
Improved antitank and antiaircraft weapons. He probably will try to
intensify guerrilla activity in central and northern Angola just to keep
the government off balance. Urban bombings and attacks on
administrative and eco taroets. "ncludina the oil facilities in
Cabinda, may increase.
 Special Analysis
A bill that grants wide powers to the president, currently under
debate by the National Assembly, is an important step toward
carrying out President Zia's pledge to restore civilian rule before
the end of the year. The still-outlawed political parties reject the
inferior position of the parliament under the proposed system,
but they have been unable to launch an effective opposition.
Sectarian unrest could delay any transfer of power, but both
military and popular pressure will make it difficult for Zia to
A small group of independent Assembly delegates is delaying
progress toward the restoration of civilian rule by prolonging the
debate over constitutional amendments that define the powers of the
president, prime minister, and parliament. Last week Zia tried to clear
the way for passage of the amendments by withdrawing a widely
criticized proposal for a national security council that would have
served as a watchdog over the parliament. His revision still gives the
president substantial power and retains what Zia sees as the most
essential provision-indemnity for martial law administrators for
actions taken under the military regime.
The bill will inevitably be passed despite opposition objections, and
this will further erode the credibility of Prime Minister Junejo and the
government's parliamentary "grouping," particularly if the
government resorts to heavyhanded tactics to get the bill approved.
Junejo has been criticized for acquiescing In recent actions of the
martial law regime. including the Imposition of mail censorship and
the preemptive arrests of opposition leaders, most notably Benazir
Bhutto, daughter of the executed Prime Minister and leader of the
Pakistan People's Party.
the opposition
may be preparing to make one more attempt at forming an effective
coalition. Leaders of the major political parties gathered late last
month to discuss their objections to the proposed constitutional
reforms; some have begun calling for a united opposition effort to
block or modify them. Even so, the Movement To Restore Democracy,
a loose coalition of 11 major Illegal political parties, is ambivalent
about how to deal with the emergence of a civilian government
because its main issue---martial law-would then disappear. Benazir
Bhutto's party, the most important in the Movement, decided shortly
after her arrest that it would refrain from activity against the regime
unless Zia fails to meet his pledge by yearend.
 i
Zia will face serious pressure to lift martial law from professional
military officers, who-except for the military governors who benefit
from the status quo-are restive over their ambiguous position under
the transitional regime. Many professional soldiers resent having to
perform police functions; others dislike sharing power with civilians
whila hearinn nrimarv recnnncihility fnr unnnniilar dACisions_F
The
public, despite skepticism about Zia's Intentions, will increasingly
expect Zia to keep his pledge to lift martial law as the year nears its
or pretext for extending martial law.
The Internal security situation has been volatile in recent months and
will be an important factor in a successful transition to a civilian
government. Unrest Inspired by sectarian tensions-such as the
disturbances that broke out in Quetta last summer-or protests
against needed economic strictures could provide Zia a justification
rallying point for them.
Zia is unlikely to let antiregime agitation reach a level that will
jeopardize the restoration of civilian rule. Martial law administrators
will keep a close watch on the activities of political opponents and
particularly on those reported to be In contact with the Soviets;
further preemptive arrests are likely. Prospects for the development
of a strong coalition among the opposition are dim, but Benazir
Bhutto's detention-due to end in late November-may yet prove a