NATIONAL INTELLIGENCE DAILY (CABLE) 21 DECEMBER 1982

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84T00301R000600010182-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 11
• Document Creation Date: December 22, 2016
• Document Release Date: August 25, 2010
• Sequence Number: 182
• Publication Date: December 21, 1982
• Content Type: REPORT

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21 December 1982
' COPY 402
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0 Top Secret
Israel-Lebanon: Diversion of Litani River Water . . . . . 4
Central America: Possible Papal Visit . . . . . . . . . . 5
OPEC: Deadlock on Production Quotas . . . . . . . . . . . 5
EC: Revised Growth Forecasts . . . . . . . . . . . . . . 6
USSR-Mozambique: Delay in Delivery of MIG Spare Parts . . 6
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 President Chun yesterday dismissed two of his closest and
most influential aides, Her Hwa Pyung and Hur Sam Su, who helped
him to power in late 1979 and 1980.
Comment: The move, as well as the release of long-
time dissident leader Kim Dae Jung last week, reflects
Chun's growing confidence and involves issues of power
and policy. Chun gradually has been neutralizing power-
ful military colleagues who helped put him in office, and
the dismissals fit that pattern. Many political observ-
ers in Seoul had considered Her to be the second most
The two aides opposed Kim's release. Chun thus
appears to be promoting his image as a national concilia-
tor and perhaps planning additional steps toward easing
political controls. For example, there are reports Chun
is considering the release of other political prisoners
and the lifting of restrictions on several hundred
Such measures would not necessarily commit Chun to
a continuing process of political reform. They would,
however, constitute his most extensive moves toward
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 CHINA-US: Joint Economic Committee Meeting
The Chinese press was cautiously optimistic about Sino-US
relations following the recent meetings of the Joint Economic Com-
mittee.
China's first official comment on the meetings, which
was released on Friday, highlighted Finance Minister Wang
Bingqian's speech lauding the rapid expansion in bilateral
trade over the past three years. Wang stressed that
the advances in economic and technological cooperation
resulted from efforts by both sides and added that ongoing
efforts were likely to bring future economic benefits.
At the same time, however, the press release noted
that future economic relations are threatened by "dark
clouds" hovering over the political relationship--a
on advanced technology as obstacles to improved ties.
Comment: China's positive approach to the Joint
Economic Committee is part of a broader effort to improve
the tone of Sino-US relations. It contrasts with an
emphasis on bilateral economic differences over the past
Beijing probably is softening its approach to the
relationship to set the stage for talks with senior US
officials early next year. There are no indications,
however, that the Chinese have changed their position
 The Lebanese are concerned that Israel plans to divert water
from the Litani River.
The Chairman of Lebanon's Litani River Authority
recently said Israeli diversion of water from the Litani
may already be under way and that a tunnel through the
mountains to the Hasbani River in Israel could be com-
pleted within a year. Early this month Israel's Water
Commissioner acknowledged that, if the currently stalled
bilateral negotiations went well at the political level,
Israel might raise the possibility of joint use of excess
Litani water.
The Israeli official suggested Lebanon could sell
50 million cubic meters per year to Israel. He said this
amount would be sent via the National Water Carrier to
alleviate the water shortage in the Gaza Strip.
Comment: //Israel has sought to use water from the
Litani since the late 1940s and has prepared technically
feasible diversion plans. In 1975 a government official
estimated the Litani could supply Israel with about 500
million cubic meters per year, an increase of 30 percent
in Israel's water supply.
Lebanon has made its own plans for use of Litani
water. A major dam was built at Al Qir'awn in 1962 to
generate electric power and to irrigate parts of the
Bekaa Valley. Additional Lebanese plans to make full
use of the Litani have been deferred by the government's
The Gaza Strip urgently needs additional water, but
it may not be the primary recipient of Litani water as
was indicated by the Israeli official. Historically,
Israeli plans have earmarked the Litani's water for the
Negev desert. The reference to alleviating water short-
ages in the Gaza may become a negotiating ploy to encourage
Lebanon to accept an initial Israeli diversion of the
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Comment:' The Pope probably will travel to all
Central American countries, with possible additional
stops in Cuba and Haiti. In El Salvador the Pope is
likely to urge the government and the insurgents to
engage in a dialogue to end the war. Political implica-
tions are most pronounced in Nicaragua, where religious
repression and participation in the cabinet by Nicaraguan
priests have strained relations with the Vatican. The
Sandinistas almost certainly will capitalize on the visit
to symbolize their legitimacy, but the Pope may renew
his public criticism of priests in the government.
OPEC ministers failed to agree on national product-
ion quotas or to deal with the problem of price cheating.
The organization announced it will maintain its $34-per-
barrel benchmark price and limit oil production to 18.5
million barrels per day in 1983, 1 million below current
output. Press reports state Saudi Arabia has been asked
to reduce its self-imposed ceiling on production from
7 million barrels per day to 6 million.
Comment: The ministers' failure makes their agree-
ment on an overall ceiling virtually meaningless. OPEC
members probably will continue producing at current levels
as long as the market permits and will discuss production
shares again early next year, when the seasonal demand
for oil is about to decline. Saudi Arabia already is
producing 1.5 million barrels below its quota, and, even
if it were to agree to a lower ceiling, it would not
 //Unexpectedly weak economic performance in the third
quarter of 1982 has led the EC Commission to revise down-
ward its growth forecasts for 1983. According to unpub-
lished data, GDP in the EC fell at 4.5-percent annual
rate in the third quarter, 4 percentage points lower than
forecast in October. The Commission now projects negli-
gible growth this year and only 0.4 percent for next year,
largely in expectation of slower export growth.//
Comment: //Debt problems in developing countries and
in Eastern Europe, a 2-percent growth rate in the US, and
growing world protectionism would all contribute to poor
export performance in 1983. Low growth forecasts probably
will lead to increasing political pressure to raise trade
barriers and export subsidies. Although some countries
may be tempted to devalue their currencies to increase
exports, most West European governments would resist
these pressures. They fear a trade war would plunge the
industrial world into a depression.//
US Embassy sources in Maputo report the USSR is
insisting on advance payment in hard currency for MIG
spare parts. Nonpayment allegedly has resulted in the
grounding of more than half of the Air Force's three-
year-old inventory of 26 MIG-17 fighters.
Comment: //It is standard Soviet procedure to require
hard currency prepayment for aircraft spares, engine over-
hauls, and maintenance contracts. These services are
managed by a separate arm of the Soviet military assistance
establishment, and special dispensation for payment relief
has to be approved at higher levels. Despite the reported
failure to work out some compromise with Mozambique on
the spare parts, Moscow appears to have increased its
shipments of new military equipment to Maputo in recent
months. Soviet officials pledged increased military sup-
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 Top
Sri Lanka will hold a referendum tomorrow on extend-
ing the current parliament until 1989, a move sought by
President Jayewardene to preserve his United National
Party's unusually large parliamentary majority throughout
his second term. A negative vote would require a general
election by next August. Over opposition objections, the
government has extended the state of emergency imposed
last October after the presidential election to discourage
Comment: The parliament probably will be extended.
The campaign against the issue by the demoralized opposi-
tion parties has been ineffective. On the other hand,
opposition from the ethnic Tamil minority in the north
and from others who question the propriety of using a
referendum to prolong parliament is likely to prevent a
strong endorsement. Public apathy and confusion about
what is at stake are likely to keep the vote down, which
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