NATIONAL INTELLIGENCE DAILY THURSDAY 11 SEPTEMBER 1980

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82T00466R000400030043-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 16
• Document Creation Date: December 22, 2016
• Document Release Date: August 6, 2009
• Sequence Number: 43
• Publication Date: September 11, 1980
• Content Type: REPORT

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E"G~\ Director of i up oecret
] Intelligence
National Intelligence Daily
Thursday
11 September 1980
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CO NID 80-214JX
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Top Secret
Situation Report
Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Briefs and Comments
Libya-Syria: Union Proclaimed . . . . . . . . . . . . . . 3
Pakistan-Iran: Declining Relations . . . . . . . . . . . 4
Romania: Concern Over Unrest . . . . . . . . . . . . . . 5
International: IMF Vote Extension . . . . . . . . . . . . 6
Cyprus : Cabinet Shuffle . . . . . . . . . . . . . . . . . 9
South Africa: Student Unrest . . . . . . . . . . . . . . 10
USSR: Hard Currency Position . . . . . . . . . . . . . . 10
Canada: Liberal Party Wins By-Election . . . . . . . . . 10
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The Islamic Consultative Assembly's unexpectedly swift approval
of Prime Minister Rajai's partial cabinet list and his government
program could pave the wary for discussion of approaches to the
hostage issue.
It is unclear whether Rajai will have to present
nominees for the remaining seven cabinet positions before
the Assembly can move on to other business. Assembly 25X1
speaker Rafsanjani said yesterday that the Assembly's
Foreign Affairs Committee would present proposals con-
cerning the hostages when it meets on Sunday.
According to the press, these proposals have already
been submitted to Rafsanjani. They evidently include the
Assembly's response to the recent letter from US Congress- 25X1
men and a recommendation that the hostage issue be debated
in the Assembly as soon as possible.
Even if the hostage issue is taken up by the Assembly,
movement on the issue may be delayed by refer in ,the
auestion to a special legislative committee.
The clerical hardliners are continuing to press their
attack against Bani-Sadr. Rafsanjani accused the Presi-
dent of acting like "the leader of a group opposed to the
government," and Ayatollah Beheshti asked Bani-Sadr to name
the minority group he has accused of trying to dominate
the government.
Iran-Iraq
Iraq appears to be using military force to readjust
its border with Iran. Iraq claimed yesterday to have
"liberated" a small strip of disputed land southeast of
Khanaqin.
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Soviet Position
or Baghdad by going very far to support either side.
Moscow is at-
tempting to persuade Tehran that only the USSR, presum-
ably through its arms supply relationship with Iraa, is
in a position to restrain Baghdad.
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The announcement by the Libyan and Syrian regimes yesterday
that they will merge into a single state may result in an institu-
tional facade but not a union with substance.
Syrian President Assad's visit to Tripoli resulted
in an announcement that the two states will form a polit-
ical, economic, and military union. A joint congress ap-
parently is to be established, but no details on such a
reorganization were given.
Assad sees the merger as a
way of reviving t He moribund "steadfastness front" as a 25X1
credible counterweight to US-Egyptian-Israeli negotia-
tions--which Assad believes is essential if occupied Arab
territories are to be regained.
money is the key ingredient for the Syrians, who are wary 25X1
alive as long as funds or arms arrive and will agree to
a certain amount of window dressing to keep Qadhafi
happy. They are likely to balk, however, if Qadhafi in-
sists--as is likely--on effecting-some of his ideological
principles, such as government by popular committees.
The Soviets have reacted to the proposed Libyan-
Syrian merger with low-key media coverage. This probably
reflects both skepticism about the potential of the ini-
tiative and some ambivalence about its desirability.
Moscow would favor increased Libyan financial as-
sistance to Syria to enhance its ability to pay for So-
viet-supplied arms and to strengthen Assad's position.
The Soviets, however, probably are apprehensive that"
Qadhafi's radical proclivities and his unpredictability,
when combined with Syria's military strength and proximity
to Israel, could lead to a conflict in which the USSR
could become involved.
11 September 1980
The Syrians probably will try to keep t he merger
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PAKISTAN-IRAN: Declining Relations
Pakistan is showing increased concern over Iran's anti-Pakistan
media campaign and Iranian efforts to exploit tensions between Presi-
dent Zia's regime and the Shia community.
Last week, Pakistan for the first time publicly
criticized Iran for the media attacks. The government-
owned press denounced Tehran radio for its recent "tirade"
inciting the people of Pakistan and Saudi Arabia to revolt
against their governments. Pakistani authorities in
Karachi on Monday seized all copies of an official Iranian
information magazine because it had published "objection-
able" anti-Pakistan material.
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Bucharest's announcement on Tuesday that it is reallocating
some defense expenditures to the consumer sector reflects the re-
gime's efforts to head off serious Labor unrest in the wake of the
disturbances in Poland.
The statement indicated that defense spending will
be cut by approximately 15 percent and that other bud-
geted expenditures will be reduced in order to fund the
government's "program of raising the people's standard
of living." The rebudgeted funds may be used to raise
wages but more likely will be allocated to import addi-
tional food and to boost investment in the long-neglected
agricultural sector. Worker unrest this summer appears
to have been provoked by unusually severe food shortages.
Transferring funds this late in the year will be
difficult, however, and it is possible that the announce-
ment was made for propaganda purposes. Such a cut in
military expenditures would have serious implications
for Romania's role in the Warsaw Pact, as it runs counter
to Soviet efforts to force Pact members to increase their
combat readiness.
Bucharest appears determined to prevent major worker
unrest, particularly in view of the apparent success of
the Polish strike.
Last week-
end the government inaugurated an unprecedented "horti-
cultural month" celebration that included large supplies
of fresh food for Bucharest, and President Ceausescu
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The 10-day extension on Tuesday of the voting deadline on the
Palestinian observer issue at the International Monetary Fund and
World Bank demonstrates the petroleum and financial leverage of the 25X1
ib
i
ru G( s G Grce L
erat
on Organizes G on ' s backers.
Lobbying by Saudi Arabia, Kuwait, and Iraq, along
with sympathy by some members for the PLO prevented a
quorum and made an extension necessary. The Saudis have
demonstrated both determination and irritation over this
issue. They argue that the US-backed resolutions aimed
at blocking PLO observer status are a breach of IMF and
World Bank regulations and that it is in the best inter- 25X1
ests of members to avoid taking a stand on conflicting
interpretations of regulations.
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President Pinochet is likely to win today's plebiscite on a
new constitution, but the political costs could outweigh the
benefits to his military regime.
The election probably will be fair--there was no
known fraud in a referendum in 1978. An overwhelmingly
favorable vote would lend an aura of legitimacy to the
regime for the first time in its seven-year history. The
constitution confirms direct military rule until 1989
and gives Pinochet the option of running for an eight-
year civilian term at that time.
A convincing vote also would make it easier for
Pinochet to ignore foreign critics, including the
countries in the Organization of American States that
considered sponsoring a resolution protesting the plebis-
cite. In addition, domestic opposition leaders who have
urged a "no" vote would appear discredited.
The referendum, however, also entails serious risks.
Some of the regime's supporters believe that if a
60-percent "yes" vote is not obtained, the military would
be embarrassed and could, demand changes in government
policies and personnel.
The newly aroused opposition is trying to use the
plebiscite to rally popular discontent. Church-state
relations--already strained by recent government re-
pression in response to an upsurge in terrorism--have
worsened. Chilean bishops have publicly complained
that the plebiscite offers no reasonable alternative to
continued military rule if the constitution is rejected.
Even if he wins by a wide margin, Pinochet may .
eventually regret providing the opposition such a clear
target. Unless he takes steps in the next few months to
mollify moderate critics while isolating more radical
opponents, the plebiscite could prove a hollow victory.
Pinochet's past harsh treatment of his detractors,
however, raises doubts about his ability to neutralize
the opposition.
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President Kyprianou's extensive cabinet changes yesterday are
aimed at silencing the growing criticism that threatens to cut short
his term of office.
Kyprianou has had difficulty managing the internal
strains among the major political parties of his coali-
tion. His troubles came to a head earlier this summer
when the powerful Communist Party bolted the coalition,
charging that he was too inflexible on the terms of a
settlement with the Turkish Cypriot minority and overly
responsive to rightist pressures.
More recently, Kyprianou's waning prestige and hard,
unproductive line in negotiations with the Turkish Cyp-
riots have prompted several deputies in his own center-
right Democratic Party to lay the groundwork for forming
a rival centrist party. Such a move would deprive
Kyprianou of his working majority in parliament.
Cyprus has a presidential form of government, and
Kyprianou can continue in office for some time without a
parliamentary majority. The loss of a majority, however,
would significantly reduce his chances of securing the
passage of crucial legislation such as the budget and
complicate his effort to serve out the remaining three
years of his five-year term.
The cabinet shuffle is designed to head off this
longer term threat to his tenure. By dumping his
Communist-supported education minister and appointing a
more centrist-oriented cabinet, Kyprianou defied his
former allies and tried to placate opponents within his
own party. In retaining his moderate foreign minister
who has advocated more flexibility in the intercommunal
talks, he signaled that he may be prepared to be more
accommodative in the new round of talks between Greek
and Turkish Cypriots set to resume next week.
The President's tactics, however, may not succeed.
The initial reaction to the cabinet changes suggests
that Kyprianou has further angered both his Communist
and rightist critics while failing to win over those in
his party who oppose his leadership.
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Zimbabwe
Makgadikgadi \'s
(Salt Pansl
Botswana
Namibia
South
J
Africa
r ~^~ Port Elizabeth
I N
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The potential for racial violence may be building
in Port Elizabeth, where black students until recently
were boycotting classes. The government yesterday closed
local black schools for the year after students and
parents ignored an ultimatum to reenroll, and special
police have been moved into the city. Several major
episodes of racial violence have occurred in Port Eliza-
beth and other nearby industrial centers in recent years.
Meanwhile, press reports of student disorders this week
in Kimberly appear greatly exaggerated. Only about
300--not 1,500--black students were involved in demon-
strations against the segregated school system. Property
damage apparently was minor.
USSR: Hard Currency Position
Spiraling prices for exports, especially oil, have
put the USSR in its strongest hard currency position
since the 1960s. The improvement results in part from
policy measures introduced three years ago. The hard
currency trade picture has allowed the Soviets to halt
almost all gold sales, thereby reducing their presence
in Western credit markets. Moscow is now able to pay
premiums for grain and other embargoed goods and to aid
its financially strapped East European allies.
CANADA: Liberal Party Wins By-Election
Canadian Prime Minister Trudeau's Liberal Party won
another seat in Parliament in a by-election on Monday.
The contest was the first since the election in February;
it was held in the industrial heartland of southern
Ontario, traditionally a swing area in federal elections.
The win gives Trudeau five seats more than a majority and
a modest psychological boost as he wrangles with provinces
over constitutional reform. The talks this week with the
provincial premiers have thus far made no progress toward
finding acceptable compromises on the constitution.
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