NATIONAL INTELLIGENCE DAILY (CABLE)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A031400210002-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 15, 2016
• Document Release Date: April 14, 2004
• Sequence Number: 2
• Publication Date: May 24, 1979
• Content Type: REPORT

Director of
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Intelligence
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National Intelligence Daily
(Cable)
24 May 1979
State Dept. review completed
Top Secret
Top Secret
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National Intelligence Daily (Cable)
Contents
Briefs and Comments
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USSR-Hungary: Brezhnev's Visit to Budapest . . 1
USSR: Reduced Publication of Economic Data . . 2
Iran: Economy Remains Hobbled . . . . . . . . 3
USSR-China: Soviets Prepare "Positive"
Response on Talks . . . . . . . . . . . . . . 4
Portugal: Amnesty Bill Veto . . . . . . . . .
Thailand: Negotiations for New Government . .
Yugoslavia: DoZanc Promotion . . .
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East Germany: Dissident, Policy . . . . . . . . 10
USSR-Iraq: Soviet Visit . . . . . . . . . . . 10
Special Analysis
International: Increased Risk of Economic
Slowdown . . . . . . . . . . . . . . . . . . 11
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USSR-HUNGARY: Brezhnev's Visit to Budapest
Soviet President Brezhnev's trip to Budapest Zate
this month appears largely intended to Zine up support
for the 30th anniversary session of the Council for Eco-
nomic Mutual Assistance scheduled for 26 to 28 June in
Moscow.
The Soviets apparently will try to use the meeting
to expand CEMA's power to deal with international orga-
nizations and nonmember countries. They also appear to
be pressing for greater integration of the East European
economies with the Soviet economy. 25X1
Premier Kosygin, while in Czechoslovakia on Tuesday,
reportedly criticized the Czechoslovak sluggishness on
coordinating the two countries' 1981-1985 economic plans.
Kosygin's trip and criticism apparently are part of an
effort by the USSR to coordinate its allies' policies
before the CEMA session.
Brezhnev's trip could also be intended to dilute the
impact that the Pope's visit to Poland in early June will
have on national consciousness in Eastern Europe. Brezh-
nev's appearance in Hungary on the eve of the first visit
of a pope to Eastern Europe will highlight the continuing
dominant Soviet role in the region. If Brezhnev tried to
make this point by visiting Poland, he would court certain
embarrassment because of the sharp contrast in the popular
receptions for him and the Pope.
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The USSR has further tightened restrictions on the
publication of statistical materials on the economy
The Soviets have yet to respond to a formal request made
n December 1978 by US members of a working group of the
!IS-USSR Commercial Commission that then furnish more
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The Soviets have always been stingy with certain
kinds of economic data. The latest decision appears to
be part of a general tightening up, beginning in 1976,
to omit, reclassify, or conceal data that the Soviets
believe could endanger their national securit or prove
25X1 embarrassing.
The resulting information gap is most serious in
the trade area. Moscow traditionally has not published
data on its external financial position--gold reserves
and sales, for example--but prior to 1976 released fairly
complete information on commodity trade. The commodity
trade handbook for 1976, however, contained major statis-
tical omissions, and the Soviets omitted more data in
1977. In particular, the Soviets have not revealed data
concerning the most sensitive industrial sectors--fuels,
metals, and chemicals. Western trade data can help fill
the gaps to some extent, but timely data on Soviet trade
with the developing countries are not available.
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formation is rarely available through other sources.
Information on the domestic economy also is on the
decline. The largest gaps are in basic data on the fuels
sector. Furthermore, much data essential to the analysis
of Soviet economic prospects in the decade ahead are no
longer available. Unlike the trade data, which can even-
tually be obtained from Soviet trading partners, this in-
September, however, and this year began to drag their
feet on furnishing monthly agricultural information under
//As a result of the US-USSR Agreement on Cooperation
in the Field of Agriculture implemented in June 1973,
the Soviets until recently increased the data they pro-
vided on agriculture. They omitted major agricultural
indicators in the 1977 statistical handbook released last
the terms of the Agreement.//
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IRAN: Economy Hobbled
The continuing government and worker intimidation of
private sector management and expectations of prolonged
political instability are preventing significant improve- 25X1
ment in the Iranian economy. Many enterprises remain in
a state of suspension, continuing to pay their employees
and hoping that demand will eventually revive.
Most retail and wholesale outlets are operating at
10 to 20 percent of their normal levels. Only the bank-
ing and oil sectors have shown real signs of life. De-
spite dissension between workers and management and Arab 25X1
pressure for autonomy in the major oil-producing province
of Khuzestan, oil production has been running at about 4
million barrels per day in recent weeks.
In both public and private institutions, workers,
suspicious and resentful of managers "tainted" by the old
regime, are interfering with executive decisionmaking.
The government has forbidden firms to fire employees and
in some cases, has forced firms to increase their staffs
to disguise the extent of unemployment. Some Iranian of-
ficials contend that the number of unemployed has declined
to less than 1 million from the 3.5 million figure that
the government cited only a few weeks ago, but available
evidence does not support this. 25X1
The expectation that political instability will per-
sist is discouraging businessmen from contemplating fur-
ther risks. Despite a new, liberal credit policy designed
to encourage businesses to finance the resumption of pro-
duction, businessmen are not seeking new credit, rebuild-
ing depleted stocks, or making new investments. Moreover,
a renewal of the strike by several thousand workers at the
Persian Gulf port of Khorramshahr and electricity short-
ages--which will become more critical in the summer--por-
tend new problems in i t2t 's attempts to get moving.
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USSR-CHINA: Soviets Prepare "Positive" Response on Talks
According to Soviet Ambassador to China Shcherbakov,
to USSR intends to reply positively to China's latest
;:roposal to begin talks aimed at improved relations. He
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response w-:Z come before the US-Soviet summit in
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Shcherbakov told I that the
Chinese note of 5 May was more avora ie in ne than
previous Chinese proposals. He stated that the Soviet
Government was carefully considering how seriously to
take China's call for talks on improvements in trade,
scientific cooperation, and cultural relations. The So-
viet Ambassador said that the USSR was consulting with
"other friendly countries, including Vietnam" regarding
the Chinese proposals and observed that renewed Sino-
Soviet ne otiations could affect the Chinese-Vietnamese
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Heading toward summit-level bargaining with the US,
the Soviets may sense that the time is right to suggest
in conspicuous fashion that they can improve relations
with China. There is no indication, however, that the
Soviets and Chinese have resolved their fundamental prob-
lems or that either side has altered its basic stance on
major issues. While still leery of China's motives,
Moscow may now decide to accept--at least tentatively--
Beijing's newly declared willingness to separate fresh
talks from the deadlock over border issues that has st
mied Moscow's past efforts to deal with China.
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]asserts that
the Vietnamese are "extremely upse y oscow's favor-
able assessment of the Chinese offer. Moscow must decide
how much it is willing to sacrifice in relations with
Hanoi while purusing new contacts with Beijing. The So-
viets are no doubt probing for any change in China's hard
25X1 line on Indochina.
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PORTUGAL: Amnesty Bill Veto
President Eanes' veto of a controversial amnesty
hill on Tuesdau could initiate a new round of conflict
between the President and the political parties. Should
,,he legislature override the veto, as seems likely, the