NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A029800010004-7
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 12
• Document Creation Date: December 20, 2016
• Document Release Date: August 2, 2005
• Sequence Number: 4
• Publication Date: February 2, 1977
• Content Type: REPORT

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NATIONAL INTELLIGENCE
Wednesday February
State Department review completed
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NATIONAL SECURITY INFORMATION
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National Intelligence Daily Cable for Wednesday, February 2, 1977.
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EGYPT: Cabinet Changes
Page 1
CUBA-ANGOLA:
Castro Interview
Page 2
SOUTH AFRICA:
School Boycott
Page 3
SIERRA LEONE:
Student Unrest
Page 3
EC: Seeking Mideast Solution
Page 4
CHINA: Defense Spending
Page 5
AFGHANISTAN: New Constitution
Page 7
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EGYPT: Cabinet Changes
I IA number of largely cosmetic changes in the Egyptian
cabinet were announced in Cairo yesterday as part of what has
been a lackluster response by President Sadat to the riots that
shook his government some ten days ago.
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n the most prominent change, Prime Minister Mamduh
Salim aces over the Interior Ministry portfolio from his pro-
tege, Sayed Fahmi. Fahmi apparently is being made the scapegoat
for the disturbances because of his failure to act more effec-
tively in heading off the most serious civil unrest in Egypt
since 1952.
I Six other ministerial-level portfolios also changed
an s, u Sadat did not remove any of the ministers on Deputy
Prime Minister Qaysuni's economic team who participated in the
decisions that ultimately triggered the riots.
I Sadat obviously is hard pressed to come up with mean-
ing u ways of alleviating the serious economic conditions that
were the root cause of the riots. During the past few days he
has made a series of appeals to student, worker, and profes-
sional groups to be patient while the government continues its
efforts to correct the many inequities in the Egyptian economy.
I Sadat may deal more forcefully with the country's
domestic situation in a major speech scheduled for Thursday in
which he is to explain the current situation to the Egyptian
people. Sadat reportedly has delayed the speech in the hope
that he will receive new commitments of financial help from
Saudi Arabia and other oil rich states.
I _J Cuba appears to be trying again to ease concerns about
its role in Angola. In an interview for Swedish television
yesterday, President Fidel Castro said that Cuba is gradually
withdrawing military personnel from Angola while increasing
civilian assistance. He added, however, that military coopera-
tion would continue.
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4 Castro's remarks are similar to public statements
by Cuban eaders last spring, when a slight reduction in Cuban
troops occurred. Between 10,000 and 14,500 troops are estimated
to remain in Angola.
A troop withdrawal might be attractive to the Cubans
because casualties in Angola have repo tedlbeen heavy and
morale among troops has declined.
SOUTH AFRICA: School Boycott
The school boycott in black townships in the Cape
Town area has intensified, according to press reports. Primary
and secondary schools have been largely deserted this week. In
one township, black students reportedly chased away pupils ig-
noring the boycott at three primary schools.
J The extension of the boycott to primary schools is a
significant deepening of student protest activity, which began
last August as an effort to get students released from jail.
The extension followed a mass meeting of teenage students on
Sunday and may have been partly triggered by the arrest of over
30 presumed student leaders last week. Most primary students
had been going to classes since schools reopened in early Janu-
ary after the Christmas recess, and increasing numbers of high-
schoolers had been reported back in school by last week.
I No equivalent of the Soweto Student Representative
council in the Johannesburg area has been identified in the
Cape Town black townships. Student leaders in the Cape Town
area, however, have clearly managed to whip up fresh enthusiasm
for the boycott despite opposition from parents, from many
teachers and respected school principals, and from seniors
wanting to prepare for examinations leading to higher education.
SIERRA LEONE: Student Unrest
I IThe first antigovernment demonstrations since Presi-
dent Stevens came to power in 1969 have brought violence in
Sierra Leone. University students in Freetown began the distur-
bances last weekend, and high school students joined the protests
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yesterday. The students are charging that Stevens is using his
office to build up his personal fortune and are calling for his
resignation.
I The government was taken by surprise, but has organ-
ized coun erdemonstrations by ruling party members. Security
forces have used tear gas to disperse demonstrators; some stu-
dents have been injured and others jailed. The university is
closed indefinitely.
I I The student protests have evoked some public sympathy
because o Stevens' venality and his pursuit of questionable
economic projects at the expense of national development. The
US embassy reports, however, that the government's firm stand
has cowed its critics, and that the leadership--despite some
signs of internal friction--appears united behind a hard-line
policy.
The national labor union issued a statement criti-
zing e government for not showing restraint in handling
the student demonstrations but later withdrew the statement
after a meeting between union leaders and government officials.
EC: Seeking Mideast Solution
//The EC foreign ministers agreed on Monday that a
ip omatic effort should be made now to find a solution to the
conflict in the Middle East. According to UK Foreign Minister
Crosland, the Nine reaffirmed their views on the main elements
of a settlement, but decided to wait until UN Secretary General
Waldheim, Secretary Vance, and the French and West German for-
eign ministers complete their visits to the Middle East this
month before publicly presenting their position on the negotia-
tions.//
//The ministers also issued a statement endorsing
British efforts to bring majority rule to Rhodesia. They de-
plored the "irresponsible attitude" taken by the Smith govern-
ment in rejecting the UK's proposals and said the minority
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white regime would receive no support from the EC. In addition,
they agreed to make a demarche later this week to South Africa
reiterating the EC's position in favor of early self-determina-
tion and independence for Namibia.//
/The foreign ministers discussed recent dissident
activity in astern Europe and the USSR but decided not to
speak out publicly on this issue. The Nine are likely, however,
to press the Soviets and the East Europeans hard on human rights
when they meet in Belgrade in June to review compliance with
CHINA: Defense Spending
I Chinese leaders appear to be debating what portion of
their u get to allocate to defense and how much to invest in
economic development.
The issue was raised in December with the publication
of a 1956 speech by Mao that emphatically called for gradually
reducing "military and administrative" costs and increasing in-
vestment in economic development. Subsequent discussion of this
speech has failed to provide much guidance on exactly how Mao's
instruction is to be implemented. Even an article discussing
Mao's speech in the January issue of Red Flag, the party's of-
ficial monthly journal, did not touch on this point.
Soon after the publication of Mao's speech, the Can-
ton Military Region explicitly agreed with the concept of giv-
ing first priority to economic development. The other 10 mili-
tary regions have expressed general agreement with Mao's in-
struction but have yet to endorse it openly as have the mili-
tary authorities in Canton.
In the most recent development, the National Defense
Industry office, the principal body supervising China's defense
industry, published an article on January 20 that seems to
agree with Mao's instruction and predicts that if it is pursued,
the "path of advance in the modernization of national defense
will be shortened tremendously." The article also urges, how-
ever that defense industry should be developed "as fast as pos-
sible."
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I This article appears to be arguing that no rigid dis-
tinction should be drawn between rapid military modernization
and economic development. Defense industry, it points out, act-
ually stimulates economic development: production of weapons
"will inevitably continue to make new demands on other indus-
tries and on science and technology, thus motivating the devel-
opment of the entire national economy."
The article also carries an important political mes-
sage. implicitly exonerates former vice premier Teng Hsiao-
ping of leftist accusations that he took a "revisionist" line
in implementing Chinese military policy during 1975.
With the allocation of resources probably becoming
an increasingly difficult issue for the Chinese leadership,
Teng's military connections and administrative talents may be
needed to strike a balance between military and non-military
spending.
I IChina's economy faltered last year when factional
rig ing slowed production and caused serious transportation
delays. The growing population, moreover, is placing increasing
demands on the economy. Those leaders who want to devote greater
resources to the economy may now be citing more realistic pop-
ulation figures--around 950 million--rather than the official
figure of 800 million.
I lAt the same time, military procurement costs seem
Bound to rise. The Chinese have gradually begun moving away
from reproducing the equipment and technology they received
from the Soviet Union in the late 1950s and are manufacturing
more of their own weapons systems.
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I iChinese-designed weapons include strategic missiles,
a nuclear-powered submarine, a new fighter aircraft, tanks,
and armored personnel carriers. Even so, the best Chinese de-
signs are generally at least a decade behind those of the USSR,
and China's defense planners are probably under considerable
pressure to accelerate the military modernization program.
I I All of this points to the great pressures that must
e conv( ging on Chairman Hua Kuo-feng. He has committed him-
self to speeding the pace of industrial development and econo-
mic growth, a policy that enjoys strong military as well as
civilian support. Some military leaders, however, may be ap-
prehensive that civilian planners will take Mao's 1956 dictum
too literally and try to cut the military budget substantially.
Exactly where adjustments should be made in defense spending
is bound to be a contentious issue within the military.
I I This situation may hold some political advantage for
ua because he could play of various military leaders against
each other and thereby increase his leverage over the military,
on which he is now heavily dependent for political support.
Teng's prospects may also be linked to this discussion since
he has come to symbolize rapid modernization policies. r
Afghanistan's constituent assembly will soon approve
a new constitution formalizing power in President Daoud's hands.
The assembly also will elect Daoud--who came to power in a
military coup in 1973--to a six-year term as president.
J The constitution establishes a strong executive, a
weak legislature, a judiciary that may acquire some limited
independence, and a single political party headed by the pres-
ident. The party will nominate all candidates for parliament
and the presidency.
The US embassy believes Daoud is trying to create a
framework- in which the people could eventually have a greater
voice in political affairs, but only when he decides the time
is right.
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Daoud will appoint the cabinet and one or more vice
presidents, and during an initial transition period will also
have judicial and legislative powers. The parliament, which
will convene in November 1979, will consider bills proposed by
the government or the judiciary; whether it will be able to
initiate legislation is unclear.
I IMajor decisions are to be ratified by the constituent
a se y, consisting of the parliament, provincial representa-
tives, senior government, military, and party officials, and
persons appointed by the president. As long as Daoud remains
in power, the legislative roles of both the parliament and the
constituent assembly are likely to be limited to automatic
approval of his decisions. The parliament will thus be even
less influential than the elected legislatures that were brought
into being by former King Zahir during the last few years before
he was overthrown by Daoud. F777 1 25X1
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