NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A030900010118-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: December 20, 2016
• Document Release Date: November 20, 2006
• Sequence Number: 118
• Publication Date: December 12, 1978
• Content Type: REPORT

p~C?e~i~~+A~Br Release 2007/03/07 :CIA-RDP79T00975A03090
Intelligence
National Intelligence Daily
(Cable)
State Dept. review completed
Top Secret
88
ecem er
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National Intelligence Daily (Cable)
ARGENTINA-CHILE: Channel Dispute 1
ITALY: Parliamentary Debate. . 2
FEATURE ARTICLE . . 4
ALBANIA: An Interim Report
I I
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ARGENTINA-CHILE: Channel Dispute
//The meeting today of the Argentine and Chilean
Foreign Ministers probably will not avert or delay an
early Argentine miZitar initiative in the Beagle Chan-
nel dispute.// 25X1
//Argentine diplomats in Rome have been trying to
persuade the Pope to act as mediator, but high-level
Vatican officials indicate that at most he will plead
publicly far a successful outcome of today`s meeting,
and offer his " ood offices" privately to bath govern-
ments.//
//If the Foreign Ministers fail to reach an accord,
the most likely Argentine military initiative will be to
occupy-the Evout and Barnewelt island groups, which the
Argentines believe to be uninhabited, and perhaps part 25X1
of sparsely inhabited Hornos Island. This action would
give the Argentines the land they seek to guarantee their
claim to maritime control in the South Atlantic.
//If the Argentine action were accomplished without
directly engaging Chilean forces, the Chileans would
probably limit themselves to a diplomatic response
rather than undertake a further military escalation.//
Most reporting suggests that the Argentines do not 25X1
want to initiate a major conflict. They are ready to do
so, however, and might attempt large-scale actions alon
the 3,200-kilometer border if the conflict widens. Q
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ITALY: Parliamentary Debate
//The Italian parliament begins debate today on
?~hether Rome should participate in the European Monetary
~~ystem. At the EC summit Zast week, Prime Minister
Andreotti decided to postpone a decision on entry in
order to consult further with the parties supporting his
~'hristian Democratic government. The parties are sharply
{.divided on the question, and Andreotti--whose government
-s already threatened by interparty differences on other
;ssues--is searehin or a compromZSe to avoid further
25X1 >trains.//
j/Andreotti's reservations at the summit centered
mainly on its failure to authorize as large an increase
in the EC regional development fund as the Italians
wanted. The Prime Minister`s stand was supported by the
Communist Party, which has argued strongly that Rome
should stay out of the system unless the EC grants con-
cessions adequate to cushion any deflationary conse-
c~uences for the Italian economy.//
//The decision was criticized, however, by some lead-
ing members of Andreotti's Christian Democratic Party and
by the small but influential Republican Party, which says
it will withdraw its support for the government unless
Italy joins the monetary system, which is slated to go
25X1 :into effect on 1 January.//
over the final form of the government's plan.//
help the government push through its controversial eco-
nomic program, aimed mainly at curbing the public sector
deficit and cutting labor costs; such measures would be
all the more essential if Rome joined the monetary sys-
tem. Conversely, the Communists, while generally support-
ive of the economic program, fear that Italian entry
into the monetary system under present circumstances
would limit their bargaining power in coming negotiations
//Advocates of Italian participation believe it would
j/Treasury Minister Pandolfi told Ambassador Gardner
yesterday that Andreotti is leaning toward endorsement of
T_talian entry. To avoid a split with the Communists, how-
ever, Andreotti has apparently been searching this week
for increased EC financial support for Italy. According
too Pandolfi, the Prime Minister has received some assur-
?~nce of further EC support from French President Giscard.
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Italian officials were reportedly in Bonn yesterday dis-
cussing with Chancellor Schmidt~s advisers the possibil-
ity of increased West German investment in southern
Italy.//
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FEATURE ARTICLE
ALBANIA: An Interim Report
since the public acknowledgement of the termination
>f Chinese economic assistance in JuZ~, Albania has pur-
:ued a go-it-alone foreign poZicU that has eschewed ac-
~~ammodation with its principal ideological foes--China
and the USSR. Neither has it shown evidence of moderat-
ing its hostiZitz~ to the US. Albania has instead acceZ-
nrated efforts begun Zast near to expand economic reZa-
Lions with selected Eastern and Western countris. So far,
+;he Albanians are not inclined--or perhaps able--to find
a "sponsor" that would rovide the benefits previousZrg
25X1 t~.xtended brg China.
A small country with few resources, Albania is, and
long will be, heavily dependent on foreign trade and as-
:~istance to sustain its industrial development. During
the nearly two decades of the Sino-Albanian alliance,
'Tirana relied almost completely on China for economic,
technological, and military assistance; the impact of
the pullout will therefore be severe.
dustrial production and an economic slowdown.
The regime of party boss Enver Hoxha has nonetheless
apparently not sought to devise a strategy for finding
a major new source of assistance. It seems instead to
have decided to continue, for the near term at least, the
}policy it has followed for the last year of gradually
accelerating economic relations with the outside world
ether than China. This approach will probably not enable
the Albanians to obtain enough industrial materials and
Equipment in the near future to avoid disruptions in in-
Evidence of any challenge to his authority.
As long as basic consumer needs are met, economic
.hardship is not likely to provoke domestic unrest. Hoxha
maintains one of the most repressive regimes in the world
and, although some Albanians may have doubts about the
wisdom of his "go-it-alone" policy, there has been no
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Hoxha publicly justified his current policy in a
recent speech in which he differentiated k~etween those.
states under "different social regimes" that are pro-
gressive and well-disposed toward Albania and. those that
are not. He-expressed Albanians desire to maintain
friendly relations with the former but stressed that it .
would not ignore or soft-pedal political and ideological
differences with those regimes. ~ 25X1
Despite Tirana's refusal to normalize relations
with the USSR, Moscow and its Warsaw Pact allies con-
time their low-key efforts to court the Albanians. Bul-
garia, which is in .the forefront of this pursuit, re-
cently published several articles that presented Albania
in a positive light, and there are unconfirmed reports
that Bulgaria, Czechoslovakia, and Poland have offered
to complete several projects left unfinished by the Chi-
nese and to provide credits for new ones. According to
a Romanian official, ,Bucharest has also made soundings
to expand economic. ties.
Albania has been generally unreceptive to these
overtures. Although one Albanian official has speculated
that Tirana might develop relations with Bulgaria if the
need should arise, the USSR--which is undoubtedly behind
the efforts of its East European allies to woo Albania--
can be under no illusion that Tirana will agree to a.
significant improvement in relations as long as`Hoxha
remains in power.
The. Albanian leader has given no indication. that
he has moderated .his .longstanding deep-seated suspicions
of the Soviets and the East Europeans. Moscow, however.,
may believe that arty minor advance encourages progress
toward brin in' Albania back. into the fold in a.post-
Hoxha era.
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25X1
The Albanians ar.e also trying to expand relations
with Algeria. The two countries signed a two-year trade
agreement in April, and Albania may have raised the sub-
ject of further trade when it dispatched a delegation
led by the Minister of Foreign Trade to Algiers in
September.
While information is fragmentary, it appears that
several West European countries, particularly Sweden and
Finland, are ready to increase their commercial ties
with the Albanian regime. A delegation led by the Al-
banian Minister of Foreign Trade left for Stockholm and
Helsinki in early November; it will reportedl sign a
five-year trade agreement with Sweden.
Probably none of these probes has yielded enough
economic gain to maintain Albania's current level of
industrial development. The Japanese have reported that
the Albanians recently made some cautious inquiries
about what procedures must be taken to obtain credits.
This could suggest that Tirana--or at least some Al-
banian officials--may contemplate lifting the constitu-
tional prohibition against borrowing from abroad. Even
if the Albanians take this step, however, it is doubtful
that they will be able to obtain enough credits in time
to prevent a serious disruption in their industrializa-
tion efforts.
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Top Secret
Top Secret
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