NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A030900010138-6
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 19, 2016
• Document Release Date: August 12, 2005
• Sequence Number: 138
• Publication Date: December 23, 1978
• Content Type: REPORT

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jc cret
prw@d4rd1f Release 2005/08/17: CIA-RDP79T00975A030900
,l Central
Intelligence
National Intelligence Daily
(Cable)
23 December 1978
Top Secret
CG NIDC 78-0298C
23 December 1978
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National Intelligence Daily (Cable)
CONTENTS
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OPEC: Reaction to Oil Pricing . . . . . . . . . . . 3
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RHODESIA: Zambia Raid . . . . . . . . . . . . . . . 5
YUGOSLAVIA: Vigilance Campaign . . . . . . . . . . 7
NAMIBIA: Assembly Resolution . . . . . . . . . . . 9
BRIEFS . . . . . . . . . . . . . . . . . . . . . . . 12
Argentina-Chile
South Korea
FEATURE ARTICLE . . . . . . . . . . . . . . . . . . 13
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OPEC: Reaction to Oil Pricing
Most oil consuming countries do not believe that
the recent oil price increases announced for 1979 by the
Organization of Petroleum Exporting Countries will put
an unmanageable burden on their economies. They are dis-
appointed, however, both with the size of the increase
and the precedent-setting automatic quarterly increases.
//Japan, West Germany, France, and the UK have ex-
pressed concern over the oil price increases, but they
do not expect the increases to have dramatic impact on
their economies. Japanese officials however, fear a
serious impact from 1980 on.// fi~ 25X1
//West German Economic Minister Lambsdorff warned
that the OPEC system of raising prices in increments
threatens to usher in a policy of indexing oil prices,
a development which he believes is against the interest
of oil consumers and even oil producers. French Economic
Minister Monory emphasized that the increases will be
detrimental to the economy, but French Industry Minister
Giraud and a top French energy official believe that
OPEC may reconsider the later stages of the price in-
crease. The British Foreign Office--which fears that too
much complaining will hurt the dollar--has advised gov-
ernment leaders to moderate their public reaction to the
increase.//
//Britain expects to become a net oil exporter in
1980, and North Sea oil prices are expected to follow
OPEC prices. Canadian and Norwegian officials have al-
ready announced Tans to hike e price of their 1979
oil exports.//
//The European Economic Community may ask OPEC to
postpone oil price rises scheduled for the second half
of 1979 and might also request a price freeze in 1980.
EC Energy Commissioner Brunner said OPEC should have
waited for the recent US economic and energy measures
and the new European Monetary System to take hold. He
called on Common Market countries to intensify energy
conservation efforts and programs.// 25X1
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The members of OPEC expect that the shift from an
annual price increase to quarterly increments will dis-
courage late-year buying by speculators who stock up in
anticipation of price increases in January. According to
an Indonesian official, OPEC will consider costs of al-
ternative energy as well as market conditions in future
pricing decisions.
Indonesia, while pleased with the price increases,
is considering not imposing the full OPEC price increase
for some customers--notably Japan. Jakarta is worried
that Japan's growing appetite for Chinese crude may
gradually reduce its interest in Indonesian oil. Indo-
nesia, however, has said that it intends to push for
periodic adjustments to oil prices as long as the dollar
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President Perez of Venezuela bragged that the price
increase was a triumph for Venezuela because of the large
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The USSR hailed the OPEC price move. TASS said the
OPEC decision is a legitimate retaliatory reaction to
the situation prevailing in the Western world. Mexico
plans to raise its oil price in concert with OPEC, but
has said that additional increases in 1979 will de end
on world oil market conditions.
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Rhodesian air and ground forces yesterday attacked
suspected camps of the Zimbabwe African People's Union
deep inside Zambia, apparently in reaction to increased
ZAPU guerrilla infiltration to release Rhodesian
prisonersa
A Rhodesian military spokesman had no comment on
Zambian charges that a Zambian Army camp was also at-
tacked, but Rhodesian aircraft may have accidently hit
the camp rather than intended guerrilla targets nearby.
Rhodesia's policy has been to avoid contact with Zambian
regular soldiers unless they intervene to defend the
guerrillas, and Salisbury probably would not want to
risk an escalation at this time by deliberately attack-
ing the Zambians.
Zambian military leaders have become increasingly
concerned about their nation's weakness in the face of
recent Rhodesian cross-border raids. If a Zambian camp
were among those hit this week, they would certainly in-
tensify their pressure on President Kaunda to improve
Zambian defense capabilities.
Rhodesia says its forces suffered no casualties
while carrying out a number of attacks against several
known guerrilla bases. The Army reports that some 31
black Rhodesian military and civilian prisoners, held
b the guerrillas, were brought out of Zambia.
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YUGOSLAVIA: Vigilance Campaign
A coincidence of economic and domestic political
problems appears to be behind a new Yugoslav party cam-
paign for a hard line at home against Western influence
and domestic dissidents. Though not intended to curb im-
proving relations with the US, Belgrade's new talk may
well entail regressions on human ri hts that could have
a negative impact. 25X1
President Tito strongly endorsed the new hard line
Thursday at Army Day festivities. He criticized ex-lead-
ers Milovan Djilas and Mihajlo Mihajlov who he said,
though once loyal revolutionaries, are now serving in
a "fifth column." Tito also threatened to expose current
leaders who tolerate such opposition by their silence.
He promised to use severe but lawful measures "to which
we are entitled." F7 -1 25X1
Party officials presented a discouraging report on
economic problems and the possible political fallout to
a party plenum earlier this week. The report included
tough denunciations of alleged plots by Yugoslav dissi-
dents who are pushing the human rights issue.
Presidium member Vladimir Bakaric painted a dreary
picture of the country's declining ability to sustain 25X1
investments and high growth trends. Bakaric condemned
the "mania" for inefficient and luxury projects that he
said continues in the country despite the declining in-
vestment resources. He stressed that in 1977 foreign
loans accounted for over half of all domestic investment
and argued that the country cannot sustain this trend
toward a growing foreign debt. 25X1
Although Bakaric made vague proposals for belt-
tightening, he left the clear impression that the party
is not yet ready to force unpopular economic restraints
on the country. Instead, his main emphasis was on a need
for heightened political vigilance. Bakaric warned that
the party should be wary of a political spillover from
economic difficulties that could heighten interrepublic 25X1
tensions and ethnic nationalism. He and other speakers
heatedly denounced dissidents Djilas and Mihajlov for
attempting to organize an anti-Communist opposition.
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Bakaric also said the population would soon receive
evidence of the dissidents' collusion with foreign anti-
Communists. Press attacks on Mihajlov later in the week
inferred he might even be jailed if he returns, as he
plans, from his current tour of the West.
Bakaric's treatment of foreign policy themes in-
cluded allegations of a sharpening of international ide-
ological conflict and "revived" anti-Communist ploys
based on the human rights issue. He bitterly referred to
the chill in West German - Yugoslav relations after the
recent dispute over mutual failures to extradite terror-
ists. He said the problems resulted from a plot by reac-
tionary forces to wreck the relationship.
Bakaric went on to list continuing differences with
the USSR over Cuban-Soviet attempts to manipulate the
nonaligned movement and over Yugoslavia's improved rela-
tions with China. He also criticized great power attempts
Lo force tighter bloc unity--an obvious statement of
support for Romania in its troubled ions with the
Kremlin.
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NAMIBIA: Assembly Resolution
The newly elected Namibian constituent assembly has
followed South African Prime Minister Botha's advice
that it agree in principle to a new election under UN
auspices. The assembly, however, has set conditions for
acceptance of a UN presence that go beyond South Africa's.
On Thursday, Prime Minister Botha, accompanied by
Foreign Minister Botha, held a closed session with the
Namibian assembly to discuss the UN Security Council's
transitional program for Namibia. Yesterday, the assem-
bly reasserted Pretoria's earlier preconditions and also
made new demands for changes in the transitional program
that the Security Council adopted last September. Among 25X1
the new demands is a call for UN troops to be placed in
adjacent states as well as inside Namibia.
Prime Minister Botha told the press that he only ad-
vised the assembly to accept a UN-sponsored election but
that he agrees with the assembly's call for UN troops to
monitor Namibian guerrilla activity in adjacent states.
Botha also told the press that the final decision--
whether to accept UN participation in a transitional
program--will be made by South Africa after further
consultation with the Namibian assembly.
The South African Prime Minister no doubt realizes
that the Security Council is even less likely to assign
UN troops to Angola or Zambia than to accept Pretoria's
earlier demands for a substantial reduction in the pro-
jected UN peacekeeping force inside Namibia. He appar-
ently intends to use the Namibian assembly's resolution
as a basis for hard bargaining with UN Secretary General
Waldheim while keeping open the option of accepting
relatively minor modifications in the present UN plan.
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Following Chilean and Argentine acceptance of Papal
intervention in the Beagle Channel dispute, tensions
have lessened considerably.
IT he Pope's involve-
men will not necessarily resolve underlying problems,
but it will provide a needed cooling-off period. Mili-
tary confrontation, at least through the liday period,
is now less likely.
A meeting yesterday of the Organization of American
States--called at Chilean request--produced no action
other than a consensus expression of port for the
Vatican effort.
South Korea announced yesterday that Kim Tae-chung--
President Pak Chong-hui's chief political opponent--will
be among 106 government critics freed in a sweeping am-
nesty next week. Kim has been serving a five-year term
on charges of violating Emergency Measure Nine, which
prohibits criticism of the government. The amnesty is
timed to coincide with the reinauguration of Pak on 27
December and will virtually clear the jails of political
dissidents. It is not clear whether Pak will the
emergency measure itself.
in another move linked to his reinauguration, Pak
yesterday shuffled his cabinet, replacing most of Seoul's
top economic policymakers but retaining Prime Minister
Choe Kyu-ha and Foreign Minister Pak Tong-chin.
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INDIA: Political Situation
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Indian Prime Minister Desai's Janata Party will
probably ride out the current storm produced by the ex-
pulsion of former Prime Minister Gandhi from Parliament
on Tuesday and her brief imprisonment. Gandhi, however,
is firmly on the comeback trail after her overwhelming
defeat at the polls in March 1977, and the move against
her has probably won her some public sympathy. The badly
factionalized Janata Party faces a new challenge today
when a dissident faction plans a rally in New Delhi that
could set the stage for its withdrawal from the party.
If Desai had insisted on a milder penalty for
Gandhi's alleged obstruction of a parliamentary investi-
gation in 1975 of her son's questionable business deal-
ings, he would have been charged with political coward-
ice by Janata hardliners. The hardliners insisted that
Parliament's integrity was at stake but many of them
were seeking retribution for having been jailed them-
selves during Gandhi's emergency rule between 1975 and
1977.
Desai and other Janata moderates argued that
Gandhi's expulsion would give her the publicity she
seeks and restore momentum to her comeback, which re-
cently seemed to be flagging. The debate in the party
was prolonged and at times bitter, but the final vote
showed an unusual degree of Janata cohesion. This at
least temporarily raised hopes among party leaders that
Gandhi's resurgence may strengthen Janata rather than
lead to further divisions.
Scattered pro-Gandhi demonstrations this week were
easily controlled, and most of them were short-lived.
Nonetheless, much of the public--particularly in the
south where emergency rule was less onerous--is sympa-
thetic to Gandhi's charge that her expulsion was an act
of political vindictiveness. Public reaction may be
further tested by a nationwide peaceful protest that
Gandhi's supporters are trying to launch.
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Gandhi says she will seek reelection, probably from
the same backwater constituency in the south that chose
her in a special byelection last month. If she does, she
Whether Gandhi returns to Parliament next year or
remains out, she probably will focus on reuniting the
Congress Party while trying to exploit tensions within
Janata and widespread dissatisfaction with its lack-
luster performance. The Congress Party, which dominated
India for 30 years before its electoral defeat last year,
split a year ago over the issue of Gandhi's leadership.
A core of anti-Gandhi dissidents still opposes reunifica-
tion, but there is no credible challenge to her role as
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in any event, Gandhi will remain in the limelight.
Sometime next year she could be put on trial for alleged
misuse of power during her emergency rule. She is now
caught up in two other legal battles--one for refusing
to give evidence before the commission that investigated
her actions during emergency rule and another for alleged
illegal procurement of vehicles for camp ai n Purposes
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Gandhi admits that some illegalities were committed
during her rule, but she places the onus on overzealous
bureaucrats and security forces. She is highly defensive
of her son Sanjay, who is keeping a low public profile
as he faces his own court battles.
Desai's willingness to get tough with Gandhi has
not placated former Home Minister Charan Singh, a brash
provincial peasant leader and one of Gandhi's most stri-
dent foes. Desai fired Singh in June because of Singh's
public attacks on Desai's leadership, including the Prime
Minister's cautious approach toward Gandhi. Repeated at-
tempts by party leaders to reconcile Desai and Singh have
failed and the dispute between Janata's two senior fig-
ures may have reached the point of no return.
Singh's followers are going ahead with a long-
planned public rally in New Delhi today--Singh's 76th
birthday. The stated purpose of the rally is to press
for greater economic benefits for the small landowners
of northern India--the backbone of Singh's popular sup-
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If the turnout is impressive, Singh may call for a
break from Janata or at least threaten withdrawal. With-
drawal of Singh and his supporters would deprive the
government of an absolute majority in the lower house of
Parliament. Singh's faction, however, may not be ready
for such a move because it realizes that this would bet-
ter serve Gandhi's purposes than its own. Even if it did
withdraw from Janata, Singh's group probably would vote
with the government on important issues to enable it to
survive its full term, which expires in 1982.
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