FOCUS REVIEW -- THE PHILIPPINES

Document Type: 
Collection: 
Document Number (FOIA) /ESDN (CREST): 
CIA-RDP83B00100R000200130001-0
Release Decision: 
RIPPUB
Original Classification: 
K
Document Page Count: 
35
Document Creation Date: 
December 16, 2016
Document Release Date: 
December 27, 2004
Sequence Number: 
1
Case Number: 
Publication Date: 
May 1, 1980
Content Type: 
MF
File: 
AttachmentSize
PDF icon CIA-RDP83B00100R000200130001-0.pdf876.28 KB
Body: 
Approved For Release 2005/01/06 : CIA-RDP83B00100R00020Q13001-0 1 Memo for Distribution from JHH, dtd 1 May 80 Subj: FOCUS Review -- Philippines (NFAC 3239-80) STAT 2 Note forl CRES) from JHH, dtd 9 May 80 Subj: Release of Cable 3 Memo for D/MS & D/P from CN, dtd 12 May 80 Subj: Request for Waiver of Medical Requirements, STAT for (NFAC 3458-80) 4 Memo for DD/NFAC from HLH, dtd 13 May 80 Subj: Request to Submit Article for Publication (NFAC 3469-80) STAT 5 6 Memo for Record from JHH, dtd 15 May 80 Subj: Reported Soviet Request to Vietnam for Secure. Perimeter at Cam Ranh Bay (NFAC 3585-80) Note to DCI from JHH, dtd 15 May 80 Subj: Visit of Amb Woodcock Memo to DD/NFA from JHH, dtd 20 May 80 Subj: NIE 11/13-80 (NFAC 3691-80 25X1 12 Memo to DCI from JHH, dtd 21 May 80 Subj: PRC Mtg on the Situation in South Korea (NFAC 3735-80) 13 Memo to DCI from JHH, dtd 23 May 80 Subj: Korean Situation Reporting by Gen Wickham in Defense Channels (NFAC 3802-80) 14 Memo to DCI from JHH, dtd 23 May 80 Subj: Warning Assessment 15 Form to D/S from JHH, dtd 27 May 80 Subj: Request to Speak 16 Talking Points, dtd 28 May 80 Subj: Korea, the US, and Western Europe/Japan 17 Memo for Record from JHH, dtd 28 May 80 Subj: PRC Mtg of Situation in South Korea (NFAC 3921-80) 18 Note for Distribution from JHH, dtd 28 May 80 Subj: FOCUS Philippines (NFAC 3858-80) STAT 19 Approvea or Release - 001-0 Approved, Release 2005/01/06: CIA-RDP816148OH00130001-0 ? THE DIRECTOR OF CENTRAL INTELLIGENCE 1 May 1980 ME FORA?NDUM FOR: See Distribution STAT FROM National Intelligence Officer for China-East Asia Pacific 25X1 SUBJECT FOCUS Review -- The Philippines REFERENCE Our Memorandum, dated 18 April 1980, Same Subject (NFAC 2079-80) The FOCUS Philippines meeting scheduled for 6 May has been rescheduled for Friday, 9 May at 0945 hours in Room 7 E 62, CIA Headquarters. Please telephone by COB 8 May to give her the names of those who will attend. OCR/Acquisition Branch NIO/China-EAP NFAC Reg Distribution (LDX to each member 1 each - DDO NFAC/RES C/NIC C/DDO/EA OPA/EA OER/IJP EO / O SWR OCR/FE/PAC D/OGCR FBIS Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 STAT Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 5 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 THEmTeWRelease 2005/01/06 : Cl '15 F CENTRAL INTELLIGENCE 12 May 1980 STkTrE FOR: Here is the paragraph you asked me for. I would like it back with your signature appended as quickly as possible. STAT ~J_ ~ ~', " I _1. \-_S ~` , \Zr,x l- w C, Approved For Release 2005/01/06 : CIA-RDP83BOOl00R000200130001-0 STAT Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 2 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 NTFAC 3469-80 Approved .eiease 2005/01/06: CIA-RDP83BOW R000200130001-0 THE DIRECTOR OF CENTRAL INTELLIGENCE 13 May 1980 MEMORANDUM FOR: Deputy Director, National Foreign Assessment Center VIA Chairman, National Intelligence Council National Intelligence Officer for China-East Asia Pacific FROM : I SUBJECT Request to Submit Article for Publication article 1. I request permission to submit for publication the attacbpa 3. None of the material presented in the article is, to my knowledge, classified. Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 0 ? 4. I am not under cover. I will be identified as an Agency employee, but will append the standard disclaimer indicating that the views expressed are my own and not nose of the Agency. Attachments As Stated I have reviewed the attached text, to the best of my knowledge have found it to be unclassified, and approve it for publication. Chairman, National Intelligence Council Date 14 MAY 1980 Deputy Director Date National Foreign Assessment Center Distribution 1 - Addressee, w/att (for return to originator) 1 - C/PRB, w/o att 1 - C/UIIC, w/o att 2 - NIO/Ch-EAP, w/o att 1 - NFAC/Reg Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130601-0 13 May 1980 Our analysts think the. -- article puts forward articulate well reasoned arguments that, for the most part are historically correct. -- There is a quarrel over the tone of the presentation. These differences lead our analysts to be generally more pessimistic about the SRV's interest in a political settlement. Folks here think that the notion that the SRV sort of stumbled across the Mekong is overdrawn. SRV is portrayed as being more reluctant on Kampuchea than they probably were and as being more anxious to settle and able to settle than they probably really are. -- OER analyst doubts rebuilding the economy was really principal objective after war,with us. The economy is now in a shales, with Kampuchean threat elimated why haven't they devoted more attention to it. They do not know how to go about long range economic development. -- OSR picks up on last paragraph about the kind of government Hanoi would need and is skeptical that there is really sufficient common ground for settlement. They don't see how China could abide government in sympathy with Hanoi. -- OPA says it stronger, although they would no doubt prefer to establish a viable puppet regime which could gain international acceptance and support -- as the regime in Laos has done -- they will keep military forces in Kampuchea as long as necessary to insure their control. -- OPA also notes even during the Vietnamese Foreign Minister's recent trip to Malaysia and in preparations for his upcoming discussions in Bangkok, the Vietnamese have shown no real signs of interest in a political compromise in Kampuchea. They may make some gestures to draw out the ASEAN states and weaken their unity -- token troop withdrawals or consideration of another Khmer leader as a figurehead for the regime -- but Hanoi still clearly considers the Kampuchean situation to be "irreversible." In the near future, Hanoi is not apt to compromise on the central issue of its domination there. Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 -- There are of course several other key factors that figure prominently in a discussion of the prospects for a settlement. - Chinese attitude - SRV's concern at being labeled a Soviet Satellite - ASEAN attitude. Approved .eiease 200: CIA-RDP83B0000R000 13 May 1980 MEMORANDUM FOR: Donald P. Gregg Office of the Assistant to the President for National Security Affairs Comments on "Vietnam: Past Restraint Suggests Desire for Kampuchean Settlement" 25X1 9 May 1980 article, clearly designed as a provocative t ink-piece, succeeds in raising a number of interesting concepts. His analysis wanders, however. Al- though Hanoi did show restraint in 1977 and 1978, as he acknowledges in his final paragraphs. there is little evidence that it will be willing to seek a political 25X1 settlement in Kampuchea. 25X1 25X1 ampuc ea. As Sino-Vietnamese tensions increased, however, the Vietnamese apparently viewed the Kampucheans as Chinese surrogates and a potentially more serious military problem. F It is true that Kampuchean forces, rather than the Vietnamese, provoked the border clashes during 1977 and 1978, and that the Vietnamese would have preferred in early 1979 to concentrate on economic development rather than becoming embroiled in military operations against the Kampucheans. They showed restraint because of their broader priorities. That does not mean the Vietnamese had no.designs on Kampuchea, however--they simply favored economic pressures and political subversion at that early point. With more than !50 million people, compared to an estimated 6 million Kampucheans, and a much more powerful military apparatus, the Vietnamese ,were no doubt confident of their long-term ability to dominate K h ou prefer to establish a viable puppet regime which could gain int n CL 11 L. eir dominant position in Kampuchea. Although they would no d bt Pol Pot, moreover, was acutely aware of the threat. He warned repeatedly that the Vietnamese intended to "swallow" Kampuchea, and apparently launched the cross-border attacks to demonstrate that Kampuchea was much tougher than the Vietnamese assumed. II The Vietnamese are clearly determined t h ernational acceptance and support--as the regime in Laos has done--they will keep military forces in Kampuchea as long Li as necessary to insure their control. The Vietnamese fear reinstatement of a pro-Chinese regime, but even if the Chinese had no access to Kampuchea at all, Vietnamese forces would continue to perform "police" duties and to prop up the pro- Even during the Vietnamese Foreign Minister's recent trip to Malaysia and in preparations for his upcoming discussions in Bangkok, the Vietnamese have shown no real signs of interest: in a political compromise in Kampuchea. They may make some gestures to draw out the ASEAN states and weaken their unity-- token troop withdrawals or consideration of another Khmer leader as a figurehead for the regime--but Hanoi still clearly considers the Kampuchean situation to be "irreversible." In the near future, Hanoi is not apt to compromise on the 25X 25 Approved For Released@N1/06 : CIA-RDP83B00100R000200130001-0 STAT Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 THE DIRECTOR OF CENTRAL INTELLIGENCE 15 May 19 80 1. Ambassador Leonard Woodcock, our representative in Beijing, will be visiting the Agency beginning at 0900 on Wednesday, 21 May. I will be seeing him privately for 30 minutes, after which he will be debriefed by NFAC representatives. DDO will be meeting with him beginning at 1100 and will host a lunch in his honor. 2. If you wish to meet briefly yourself with Ambassador Woodcock, I will make the necessary arrangements with him. cc: DDCI DD/NFA C/NIC Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130601-0 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 9 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 25X1 THE DIRECTOR OF CENTRAL INTELLIGENCE 20 :day 1980 NEMORAYTDUM FOR: Deputy Director for National Foreign Assessment National intelligence Otticer for China-East Asia Pacific SUBJECT NIE 11/13-80 1. Apropos of your comments at the NIO meeting on 20 May, I would appreciate any guidance you can provide on where you think the Key Judgments section of the Sino-Soviet Estimate might be expanded to reflect more fully the language of the text. At Dick Lehman's suggestion, I would propose to insert appropriate phraseology from the text (which has already been agreed upon by the representatives) to insert in the Key Judgments. In this way a further meeting of the representatives might be avoided. 2. If this procedure is not feasible, it will probably be necessary to convene another meeting of representatives to review once again the Key Judgments section. cc: C/NIC Distribution 1 - ?'D/NrA 1 - DD/:;FAC 1 - C/:TIC 1. - Action Staff 1 - NIJ/USSR-?E 1 - :TIO/China-EA,P 1 - TFAC Reg DERIVATIVE CL BY SIGNER REVIEW ON MAY 86 Derived from Multiple All Portions SECRET. Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 12 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0,, THE DIREC? OF CENTRAL INTELLIGENCE National Intelligence Officers 21 May 1980 Attached are the Talking Points, State paper and other related materials for the PRC meeting on the Situation in South Korea scheduled for 22 May at 1600 hours. Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 Approved Felease 2661M706 : CIA-RDP83BO R000200130001-0 S=AC 3735-80 THE DIRECTOR OF CENTRAL INTELLIGENCE 21 May 19 80 MEMORANDUM FOR: Director of Central Intelligence Deputy Director of Central Intelligence THROUGH Deputy Director for National Foreign Assessment Chairman, National Intelligence Council 25X1 National Intelligence Officer for China-East Asia Pacific SUBJECT PRC Meeting on the Situation in South Korea 1. Action Requested: Review talking points and related materials covering matters to be discussed at the PRC meeting scheduled for 22 May at 1600 hours. 2. Background: The meeting, which will be chaired by State, has been convened to discuss: o ~v'hat are realistic objectives for us to pursue in relation to the current ROK political situation? e How can we best use our leverage? General Jones will brief on the military situation and the North Korean threat, and you are scheduled to brief on current developments in South Korea. As you know, the serious confrontation between the South Korean military leadership and student demonstrations which we anticipated in our Alert Memorandum of 9 May (Tab D) has in fact taken place, and has led to the arrest by the military authorities of student leaders and prominent politicians who allegedly supported them, the imposition of complete martial law, the closure of the National Assembly, the mass resignation of all opposition National Assemblymen, and the DERIVATIVE CL BY SIGNER REVIEW ON MAY 86 Derived from Multiple Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved Velease 2005/01/06 : CIA-RDP83BO R000200130001-0 Off SECRET resignation of the Cabinet to leave President Choi as the only civilian official presently functioning in the South Korean govern- ment. The southern cities of Kwangju -- Kim Dae Chung's home area -- has suffered a massive insurrection that has been raging out of control for over three days. The military crackdown has at the minimum suspended indefinitely the process of political liberalization which had been under way following the assassination of President Park last October. A major breakdown of governmental and military control over the country could also take place if rioting spreads. 25 25 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 1 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Approved Felease 2005/01/0 CCIA RDP83BOgfR000200130001-0 25 11. Your briefing book is arranged as follows: Tab A -- Your Talking Points Tab B -- State Paper on Policy Review in Korea Tab C -- Current Sitreps Tab D -- Our Alert Memorandum of 9 May Tab E -- South Korea: Chronology Tab F -- Intelligence Memorandum on South Korean Students: The Potential for Unrest Tab G -- Intelligence Memorandum on Political Reconstruction in South Korea: A Difficult Road Tab H -- SNIE on North Korean Reactions to Instability in the South 25 All Portions of this Document are SECRET. Distribution DCI DDCI Handcarried tol 2lMay80 NSC/CS ER DD/NFA DD/NFAC, w/o atts 5 Action Staff, w/o atts C/NIC, w/o atts NIO/Cheapproved For Release 2005/01/q?C. A-RDP83B00100R000200130001-0 NFAC/RReg, w/o atts ApWed For Release 2005/01/06: CIA-Rl3B0010QI O260T34W1 D( THE DIRECTOR OF CENTRAL INTELLIGENCE 23 May 1980 Deputy Director of Central Intelligence MEMORANDUM FOR: Director of qentral Intelligence THROUGH Deputy Direr4or,for National Foreign Assessme na-l--I.ntelligence Council 4 National Intelligen'Office r for China-East Asia Pacific SUBJECT Kos ream-situation Reporting by General Wickham in Defense Channels 1. You will recall that at the 22 May PRC meeting, SECDEF and General Jones made frequent references to messages that had been received from General Wickham in Korea. These messages are not being made available to CIA and we are therefore deprived of a significant source of information and considered judgment regarding developments in South Korea. 2. I believe it would be helpful in this situation that you talk with Secretary Brown, General Jones or General 'Tighe and ask them to release messages from General Wickham to us. We would of course keep them closely held. -')7-str.?bution- 1 - DCI 1 - DDCI 1 - ER 1 - DD/_iFA 1 - nn/:1FAC 1 - Action Staff 1 C/'1IC 1 - NNIO/Ch-EAP Chrono 1 - _1I0/Ch-EAP File 1 - NFAC Registry Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 Approved F46Release 2005/01/06: CIA-RDP83B00~OR000200130001-0 TOP SECRET THE DIRECTOR OF CENTRAL INTELLIGENCE 23 May 1980 MEMORANDUM FOR: Director of Central Intelligence Deputy Director for Central Intelligence Deputy Director for National Foreign Assessment National Intelligence Officer for Warning National Intelligence Officer for China-East Asia Pacific SUBJECT Warning Assessment: China-East Asia Pacific The following items were discussed by the Community Representatives at the 19 May Warning meeting. China 1. Analysts discussed the apparent contradictions between the recent speech of Hua Guofeng which contained criticism of material incentives, and a Peoples Daily article the following day defending such incentives in strongest terms. While Hua's speech could have represented a. serious division among the leadership, most analysts considered it to be more of a personal position of Hua himself, who seems to be fighting a losing battle to stay in power. Deng Xiaoping's reported decision to step down in August probably meant that he would be taking Hua with him, too, and Hua is "going out with a whimper." The question of incentives would be addressed at the forthcoming NPC session according to Vice Premier Zhao Ziyang, but there was no reason to believe that present policy lines would be reversed even though there were clearly those at lower levels who opposed material rewards for production increases. DERIVATIVE CL BY SIGNER REVIEW ON MAY 2000 TOP Approved For Release 2005/01/06 :CIA-RDP83BOO100R000200130001-p TIPLE Approved .Release 2005/01/06: CIA-RDP83B00o0R000200130001-0 TOP SECRET 25X1 25X1 25X1 2. On Chinese foreign policy, analysts believe that the Chinese are presently quite concerned over their relations with the ASEAN countries, particularly the tendency among some of these countries -- Indonesia and Malaysia -- to seek out a negotiated settlement of the Kampuchean situation. This may be why Deng Xiaoping spoke of accepting a phased Vietnam withdrawal from Kampuchea to a German reporter. There was no question but that China is now in a more difficult situation then it was a year ago with respect to Vietnam and Kampuchea (see below) Indochina 3. Analysts did not believe that Vietnam intended to make any serious concessions with respect to Thai and the other ASEAN countries on troop withdrawal from Vietnam -- the reported VN willingness to withdraw some troops was regarded as a token gesture and possibly could be related to the practice that Hanoi followed in last year's rainy season in withdrawing some units back to Vietnam for refitting. Vietnam Foreign Minister Thach's visit to Kuala Lumpur showed no real flexibility despite some reference to some troop withdrawals under "certain conditions." However, the Vietnamese apparently perceived the existence of differences among the ASEAN nations on ne otiations and were trying to exploit these differences. 4. The purge of the Lao Dong party currently conducted by the Vietnamese was not regarded as being particularly serious; the Vietnamese were evidently attempting to weed out cadres who were "good at war but no good at managing the economy." The corrupt and inefficient were also targeted for elimination. Nevertheless, the purge (which had begun in January) could pickup steam later this year as high-ranking party members became involved. It was noted that party members of Chinese ethnic background were being 6. Within Kampuchea, analysts commented that the DK forces under Pol Pot had evidently developed plans for military operations during the rainy season, but no real action had yet occurred. However, the rainy season had not yet fully arrived. The DK forces were evidently drawing food supply from UN stocks at the Thai border. Arms and equipment from Chinese sources appeared adequate. 25 25 25 25 A lap.d 2 23 M So oved For Release 2005/01/06 : CIA-RDP831300100R000200130001-0 Approved .Release 2005/01/06: CIA-RDP83BOOOR000200130001-0 TOP SECFET 7. Analysts observed that the Vietnamese were trying hard to provide a facade of a Kampuchean governmental structure under Heng Samrin, but were still not having much success. Village committees had been set up in some areas of Kampuchea but lacked real authority and the only local governmental operations which functioned required active Vietnamese support. South Korea 11. Analysts were not surprised by the declaration of martial law in South Korea given the failure of the government's restrained approach to student demonstrations. One analyst characterized General Chun Doo Hwan as having a seige mentality which made his strong reaction to the student's ultimatum and 22 May deadline predictable. It was generally agreed that Chun enjoyed strong support within the 23 May 1980 25 25 25 Approved For Release 2005/01/06 : CIA-RDP83BOO1OOR000200130001-0 25X1 25X1 Approved. Release 2005/01/06: CIA-RDP83B0Q0R000200130001-0 TOP SECRET military for tougher action against the demonstrators and the establishment of martial law. Indeed, a Defense Security Command Survey of senior military officers, which has come to light since our meeting, appears to back up that judgment. There is probably a good deal less support among military officers for Chun's capitalizing on martial law to neutralizes in some cases wipe North Korea 12. North Korean I&W anomalies were noted, but they were thought not to be significant, even in combination in suggesting the North was preparing for an attack. 4 23 May 1980 25 25 25 Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 Approved sRelease 2005/01/06: CIA-RDP83B0O0R000200130001-0 Distribution: Copy 1 - DCI 2 - DDCI 3 - ER 4 - D/NFAC 5 - DD/NFAC 6 - AS/NFAC 7 - NIO/W 8 - NIO/Ch-EAP File 9 - NIO/Ch-EAP Chrono 10 - NFAC Registr" Approved For Release 2005/01/06 : CIA-RDP83BOO100R000200130001-0 14 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 1 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 W7- Apprcw For Release 2005/01/06: CIA-RDP, 00100R000200130001-0 REQUEST TO SPEAK, PRESENT A PAPER, OR PARTICIPATE IN A PUBLIC MEETING 1. Title of Presentation & Nature of Meeting: Board Meeting of National Council for US-China Trade Recent political and economic developments in China 2. Name of Institution/Title of Meeting: NCUST 3. Location: Metropolitan Club, Washington, D. C. 4. Time: 7:30 p.m., 3 June 1980 25X1 25X1 S. Name and Position of NIC Requester: 6. Identified as CIA? YES Agency-sponsored? No 7. Dollar Cost to NIC (approx): None 8.`Ti/Unclassified (Delete one; if classified, indicate level.) 9. Other Pertinent Information: I addressed this group under similar circumstances last year. APPROVE: Z7 I G6 (Chairman, National Intelligence Council (Date) 25X1 25X1 41 Coor inat r for Academic Relations) (Director of Security) (ate 30 D e Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 NUASSIFIEI Apprd1VIE% lase 2005/01/06: CIA RPPO ROUTING AND RECORD SHEET SUBJECT: (Optional) REQUEST TO SPEAK IN A PUBLIC MEETING OFFICER'S INITIALS TO: (Officer designation, room number, and building) NIC Admin Officer CAR Room 7G25 D/OSOEAB Room 4E33 IIsr~g IO NI O/ CII-EAP kL AQ20013000n SECRET 27"lay 1980 COMMENTS (Number each comment to show from whom to whom. Draw a line across column after each comment.) FORM USE PREVIOUS //~ Tld Fok~ Q~~~,,100R 3-62 610 EDITIONS CCRET nnel CIA~R (JNLT O0 ova208kdc 1S~iED a ~~~bM~d6: Approved For lease 2005/RM- CIA-RDP83B00100R000200130001-0 is T 08 May 1980 Korea, the US, and Western Europe/Japan I. Recent events in ROK -- student riots, martial law, Kwangju bloodshed, trend away from political liberation and toward a possible military dictatorship -- add yet another significant area of tension to troubled world scene. US unavoidably drawn in due to our military presence in ROK, 35-year history of close relationship with successive ROK governments, commitment to defense against North Korean attack. II. Western (including Japanese) concern and relationship derives from several considerations -- Security, i.e., possibility of hostilities if NK attempts to exploit current disarray in the South by launching a military attack. (Due to proximity, Japan particularly concerned, and Ohira expressed such fears to visiting PRC Premier Hua Guofeng on first day of Hua's visit. Hua said NK would not attack.) -- Related issue is that EC and Japan have very large invest- ments in ROK, which they stand to lose outright if the North attacks. We also have a very heavy economic stake. Break- down is as follows: South Korea: Foreign Capital Inflows by Country (Nil US $) 1976 1977 1978 1979 Cumulative 1959 thru latest year Total 842 1260 1930 NA 7745 US 231 260 310 NA 2123 Japan 51 348 585 NA 1758 EC 343 407 607 NA 2320 Public Loans Total 711 608 818 NA 4763 US 191 126 176 NA 1451 Japan 55 76 98 NA 818 EC 65 47 70 NA 396 Equity Investment Total 85 103 101 126 999 US 28 12 15 29 191 Japan 49 53 45 55 586 Other 8 38 41 42 222 Approved For Release 2005/V CIA-RDP83BOO100R000200130001-0 Approved Fore ease 2005/9 /98 CIA-RDP83B0010400200130001-0 -- Even if NK exercises restraint, continued political unrest in ROK deriving from resistance by student groups, intellectuals, the Church, etc. to martial law, moves by General Chun Tu Hwan to establish military dictatorship and one-man rule, could undercut ROK's "economic miracle" and discourage further foreign loans, investments. ? ROK already facing serious economic difficulties prior to present crisis: GNP growth only 3-4% p.a. (vice 1971-79 average of 9.9%); inflation running at 25%. Wage increases granted as result of wave of strikes last April could push inflation to 30%. -- As a result, foreign banking consortia are now seriously considering holding back on further development loans. But absence of such loans could further exacerbate ROK economic strains and add to political tensions. (Labor groups have not joined with students in present situation, but might if economic conditions worsen.) III. Western Europe and Japan will inevitably look to US to assist in maintaining ROK's political stability and economic progress. -- Most importantly, our military responses to the potential NK threat will be carefully scrutinized as to adequacy. -- We will be expected to apply leverage on General Chun and his military colleagues to exercise moderation; restore unity, and not stand in way of political liberalization. -- We will also be expected to do what we can to safeguard the economic stake which WE and Japan have in ROK. ? Our own bankers will also be watching us closely for signs that we are playing a positive role with respect to ROK economic developments. If we falter, they will cut back. -- Our problem is, however, that given our defense commitment to the ROK our leverage over General Chun and his colleagues is not great. Our friends. and allies may not understand. this. Approved For Release 2005 /& T: CIA-RDP83BOO100R000200130001-0 FROM: I 30 May 19 80 Attached is the summary of events from the 22 May PRC meeting on the situation in South Korea. cc: DDCI DD/NFA C/NIC C/DDO/EA Approved For Release 2005/01/06 : CIA-RDP83B0000RU00200130001 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 9 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 pproved For Release 2005/01/06 : CIA-RDP83BNFA 4 THE DIRECTIP OF CENTRAL INTELLIGENCE 28 May 1980 SUBJECT: FOCUS Philippines Attached is the draft of the FOCUS Philippines. Please contact by COB 6 June with your comments or concurrence. Attachment As Stated for East sia DIA NSA DIA Fre Ashley, State Arthur Long, Treasury Hubert F. Matson, Army John H. Porasky, Air Force Lee Piartin, DOE DDO/EPDS/FREG C/RES NITO/HTO C/'TIC %TIO/EA C/DDO/EA OPA/EAP OER/ IJP EO/OSWR OCR/FE/PAC D/OGCR FBIS OCR/Acquisition Branch ?TFAC Registry pproved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 25X1 Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0 Next 15 Page(s) In Document Exempt Approved For Release 2005/01/06 : CIA-RDP83B00100R000200130001-0