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December 22, 2016
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August 18, 2006
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November 23, 1976
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AiRpr OM AW AdW AdW Aar provdOor Release 2006/08/21: CIA-RD 0975 0001 -0 1 1 1 1 1 1 Top Secret (Security Classification) PREPARE REPLY RECOMMENDATION RETURN FROM: NAME, ADDRESS, AND PHONE NO. f5x1 Access to this document will be restricted to those approved for the following specific activities: NATIONAL INTELLIGENCE DAILY CABLE Tuesday November 23, 1976 CI NIDC 76-274C w 0 0 Top Secret (Security Approved For Release 2006/08/21: CIA-RDP79T00975AO29500010040-0 Approved For Release 2006/08/21: CIA-RDP79T00975AO29500010040-0 Q Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For Rel ase 2006703721 : - 90010040-0 ~?91 National Intelligence Daily Cable for Tuesda November 23, 1976. 2 X1 I IT he NID Cable is for the purpose of informing 25x1 senior US officials. CONTENTS MEXICO: Exchange Control POLAND: Church Supports Workers GREECE-TURKEY: Aegean Talks Conclude Page 1 Page 1 Page 2 POLAND-USSR: Economic Aid CHINA: Status of Chiao Kuan-hua PERU: Bolivian Corridor Proposal JAMAICA: Election Outlook ARGENTINA: Possible Wage Increases Page 5 Page 6 Page 7 Page 8 Page 9 Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved MEXICO: Exchange Control Mexico yesterday temporarily suspended trading in all foreign currencies and gold by banks. The measure was necessi- tated by massive capital flight in recent days as a result of coup rumors and the continuing decline of confidence among busi- nessmen. Confidence has reached a new low since President Echeverria's expropriation of about 100,000 hectares (250,000 acres) of rich farm land in the state of Sonora on Friday. The expropriation was a drastic move by Echeverria in the waning days of his administration to deliver on his promise to break up large private farms and distribute them to landless peasants. The move has evoked a strong outburst from conservative busi- nessmen, who are trying to organize a business strike in pro- test. The expropriation will pose a serious problem for 25x1 president-elect Lopez Portillo, who takes office on December 1. He has indicated that he will try to avoid division of land holdings because it creates uneconomic units that hinder agri- cultural production. Business and conservative interests will urge Lopez Portillo to rescind the expropriation, but gounter- 2 x1 pessure from peasant rou s will make this difficult. I POLAND: Church Supports Workers The Polish Episcopate has apparently renewed its plea for amnesty for all persons involved in the June rioting and has started to collect funds to aid the families of those who were jailed or lost their jobs. Polish media have as yet made no comment on these actions, which have been reported in the Western press. If the reports are true, the Catholic bishops have increase pressure on the regime by lending their authority to the campaign that the Committee for the Defense of the Workers began in September. The church can attract much more attention to the cause of the dismissed workers than can the committee, which was founded by dissident intellectuals. The church has Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved reportedly tempered this latest action, however, by deciding not to launch a nationwide campaign or use the pulpit to make pleas for money. I The Episcopate joined the committee's cause just one 25x1 day after the government's press spokesman, Vice Minister for Information Janiurek, branded the committee "illegal" under Polish law. In answering a question from a foreign journalist, Janiurek said the committee would be fought on the "ideologi- cal" front, but he warned that "our patience isn't everlasting." In an obvious effort to counter reports in the West- ern press, Janiurek said that only 74 persons remain in jail and that no one had been prosecuted for participating in strikes. The committee disputes this figure. In any event, the committee and Episcopate are more interested in those workers who have suffered various kinds of reprisals, including loss of jobs, than in those who are still in prisop. On the former, the regime has been conspicuously silent. GREECE-TURKEY: Aegean Talks Conclude Greece and Turkey made considerable procedural prog- 25x1 ress an roke some new substantive ground in their recently concluded talks in Bern and Paris on the Aegean question, but they have yet to take up the most difficult issues. Any follow- up negotiations are likely to be intermittent and protracted. Both sides assert that the talks in Bern dealing with the continental shelf have set the stage for serious substan- tive negotiations in the coming months. A committee of experts is to work in secret on the question of delimitation of the shelf, using the practices of other states and international rules as guidelines. According to a communique issued in Bern, the two countries have also agreed not to take any actions in the Ae- gean that could disrupt the talks, and not to try to discredit each other in their bilateral relations with other states. In practical terms, this apparently means that the Turks agreed 25X1 Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For Rel ase 2006703721 : UIA-KUFI~) 029500010040-0 25X1 not to engage in oil exploration in contested waters, and the Greeks undertook not to lobby in the US and in Western Europe against Turkey. After a summer of high tensions, both sides seem con- 25x1 tent for the time being to limit their jockeying and to seek some narrowing of their differences. The limited agreements reached so far offer considerable scope for differing interpre- tations, however. I For example, the Turks are already inclined to be- 25X1 lieve t a the Greeks are violating their commitment. The Turks, moreover, may find it difficult not to resume an assertive pol- icy in the Aegean next spring, as the campaign for their October parliamentary election heats up. For their part, the Greeks are unlikely to refrain completely from their traditional efforts to see rful Turks. 21X1 Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For Release 2006/08/21: CIA-RDP79T00975AO29500010040-0 Q Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For R POLAND-USSR: Economic Aid The Soviet economic aid package to Poland--agreed 25x1 upon during party leader Gierek's visit to Moscow earlier this month--will give Poland's economy a boost and help improve its balance of payments. The package includes the resumption of grain deliveries, shipments of raw materials above planned levels, increased deliveries of consumer goods, and, according to press reports, a low-interest loan worth $1.3 billion at the current exchange rate. creased imports of machinery, raw materials, and possibly grain from the USSR. At the least, Poland would not have to divert exports from the West to pay for the additional Soviet deliver- ies. The report of the Soviet loan credit is still uncon- 25X1 firmed If true, the credit probably would be used to finance in- I credit may allow Poland to redirect some of its 25x1 exports from the USSR to other markets. Coal and other products could be sold in the West for hard currency, and a suspension or reduction of meat exports could be used to bolster domestic meat stocks, already at an alarmingly low level. IThe resumption of Soviet grain deliveries and in- 25x1 crease shipments of raw materials will allow Poland to curb further the growth of its hard-currency imports in 1977. The Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For Soviets reportedly will deliver at least 1 million tons of barley and an undetermined amount of wheat to Poland next year. I Details on raw materials deliveries are sketchy. Po- land reportedly will receive shipments of oil in 1977 at 1976 prices. The Soviets may also have agreed to increased deliveries of raw materials, such as iron ore, that Poland buys from the West for hard currency. Polish consumers will benefit somewhat from increased imports of consumer goods in chronic short supply--ref color television sets, and small household appliances. 25[1 I The political status of Chinese Foreign Min- 25x1 ister Chiao Kuan- ua seems to be in question. //Rumors are cir- culating in China and in Chinese missions abroad that he will be removed from his post.// He last appeared in public on No- vember 11; since that time he has missed two important visits at which he would normally have been present. The official explanation for Chiao's failure to meet visiting President Bokassa of the Central African Republic was illness. He is reportedly being "investigated," however, be- cause of his wife's alleged ties to Mao's disgraced widow, Chiang Ching. I IWe have no reason to believe Chiao was linked to the tour e fists now under attack--he was, in fact, a protege of the late premier Chou En-lai--nor can we confirm allegations that Chiao's wife had ties to Chiang Ching. Chiao's political difficulties, if indeed they exist, would, however, seem to be related to domestic issues rather than to any unhappiness over his conduct of foreign policy or his foreign policy positions. Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For Rofhecrm 21506/'f)&21 - 29500010040-0 25x1 time--but he seemed genuinel leased by Hua's promotion and the arrest of the leftists. 25-111 By most accounts, Chiao has gotten along well with new party Chairman Hua Kuo-feng. He played no role in Hua's move against the leftists--he was at UN headquarters at the PERU: Bolivian Corridor Proposal Ocean. Chile made its own proposal last December. Peru has presented Chile with a formal counterproposal 25X1 for creation of a corridor giving Bolivia access to the Pacific --Eventual cession to Bolivia of sovereignty over a corri- dor through northern Chile to a point short of the ocean. --Tripartite administration by Peru, Chile, and Bolivia of the remaining section of the corridor to the sea. --Tripartite administration of the Chilean port of Arica. --Authorization for Bolivia to construct its own port and to control the corridor's coastline. I The original Chilean proposal was to grant Bolivia 25x1 exc usive sovereignty over a similar corridor, with no addi- tional provisions. hoped to regain territory in the Arica region which was lost to Chile in the last century, and consequently welcomes any delay on the corridor issue. With their current proposal, the Peruvians apparently 25x1 are counting on Chile and Bolivia to disagree. Peru has long I The Bolivian government will study the Peruvian pro- posal, but for the present is likely to await Chilean reaction. Bolivian leaders probably will be displeased that their coun- try's sovereignty in the proposed corridor would not continue to the sea. negotiations to keep relations with Peru amicable, but will Chile seems likely to take strong exception to Peru's counterproposal. The Pinochet administration may well continue Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For - 029500010040-0 nevertheless have reservations, particularly about the proposed joint administration of the port of Arica. Indeed, the semi- official press in Santiago has already billed Peru's offer as "a negative response" to Chile's earlier bid. There is a good chance that negotiations will eventu- 25x1 ally founder or reach a stalemate. Chile may not be entirely reluctant to see the corridor idea languish or fail altogether, since realistic hopes in Santiago for a workable solution have probably never been very high. Both sides may prefer, nevertheless, to keep the talks 25X1 going as long as possible. Should a breakdown occur, border ten- sions would probably increase. 25x1 Jamaican Prime Minister Manley has called for an early general election, on December 15, in an apparent effort to act before a further erosion of his popularity, as Jamaica's economy continues its decline. I IManley's People's National Party and the opposition Jamaica Labor Party led by Edward Seaga appear to be running nearly even. A newspaper poll in late October indicated that the ruling party was leading in the popular vote by 51 to 49 percent, but that the Labor Party was likely to achieve a 28-25 advantage in parliamentary seats under the present dis- trict arrangement. The House of Representatives, however, is expected to approve today a government proposal to redraw par liamentary district boundaries and create seven new seats. I Manley is relying heavily on this gerrymandering move. He is also counting on his skill as a campaigner to re- verse middle-class voter defection from his party and prevent abstentions by party members who are dissatisfied with his handling of the economy and alarmed at the growing influence of the party's left wing. The closeness of the race reflects the marked decline 25x1 in the Manley government's popularity. In the last national election, in 1972, his party won 56 percent of the popular vote, and it currently holds more than twice the number of seats in the parliament held by the opposition. Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For elease 2006/08/21: CIA-RDP79T0097 029500010040-0 25x1 I IManley has acknowledged being concerned about his party's prospects and is supporting the renomination of even its conservative members of parliament if they have proven vote-getting ability. The leading party leftists have also been given a place on the ticket, as candidates for the new districts. nonetheless be handicapped by the fact that many of its candi- dates are young and not as well known as those of the ruling party. The opposition Labor Party has been campaigning hard for several months, and Seaga expects to win. His party could persons, including nine members of the Labor Party. The campaign may well be plagued by violence. Already 25x1 a clash between ruling party activists and part of a motorcade carrying Seaga and former prime minister Shearer injured ten on their own initiative. The election will be held under a state of emergency, however, and Manley can be expected to use his broad temporary powers to intimidate the opposition and even to carry out massive arrests if he deems it necessary to ensure his re-election. There have been other scattered incidents, apparently 25X1 instigated in most cases by members of the ruling party acting Manley has been stressing the theme of "national 25x1 unity against imperialism," and his attacks on the A-could b 71 F 25 1 ecome mothe CIA--could become more pointed. ARGENTINA: Possible Wage Increases The Argentine government is preparing to announce wage increases in an effort to reduce labor restiveness, which has become serious in recent months. Economy Minister Martinez de Hoz earlier this month said the ruling military junta would allow "selected" pay in- creases by the end of the year. A general wage hike of some 12 percent last September has already been wiped out by cost- of-living increases totaling nearly 20 percent in September and October. Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 Approved For R4 President Videla late last week reportedly approved a proposal that would allow raises for "practically all" pri- vate-sector unions. The increases are to be retroactive to November 1. In recent months, labor dissatisfaction has resulted in several serious challenges to the junta's ban on all strike activity. Electric power workers recently staged a series of strikes and slowdowns; port workers have engaged in a slowdown in recent weeks; and thousands of auto workers walked off their jobs some months ago. Although the new pay boost will provide short-term help for the junta's problems with labor, it will hurt in an- other respect. The granting of a wage increase will be seen as a concession and eventually will invite challenges from labor and others who see the 'unta's position as weakening. 5x1 1 25X1 Approved, For Release 2006/08/21: CIA-RDP79T00975A029500010040-0 AMW ~Aff .prove- ele 06/0 : CIA- T00975A029500010040-0 0 0 0 0 0 1 1 0 0 Top Secret (Security Classification) AOF Top Secret (Security Classification) 'AW Aar AMr 'AW AMr AdV AW Aff AAW Aj Approved For Release 2006/08/21: CIA-RDP79T00975A029500010040-0