INDICATIONS OF POLITICAL INSTABILITY IN KEY COUNTRIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87T00685R000300500003-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 60
• Document Creation Date: December 22, 2016
• Document Release Date: May 2, 2011
• Sequence Number: 3
• Publication Date: May 1, 1986
• Content Type: REPORT

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:?~E~U Directorate of
f ~ Intelligence
Indications of
Political Instability
in Key Countries
May 1986
GI IPI 86-002
May 1986
648
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Directorate of Secret
Intelligence
Indications of
Political Instability
in Key Countries
This quarterly was produced by and coordinated
within the Directorate of Intelligence. Comments and
suggestions are welcome and may be directed to
Secret
G/ /PI 86-001
May 1986
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Secret
Summary: Levels of Concern
Countries With Developments of Special Interest
25X1
25X1
5X1
25X1
25X1
25X1
25X1
25X1
25X1
25X1
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Secret
Indications of
Political Instability
in Key Countries
This quarterly publication is designed to provide timely warning of
significant instability in countries of key importance to US interests. The
quarterly, which in this issue includes data from 1 February through 30
April, examines events and processes that could lead to major regime or
policy changes. The paper assesses our levels of concern regarding the
potential for instability in the short term and over the next two years
through the consistent application of 24 indicators.
The quarterly includes three parts:
? Part 1 includes a brief narrative assessment of each country and country-
specific tables tracing significant political and economic changes during
the past two years. The 30 countries we assess have been identified as
particularly salient to US interests because they are strategic choke
points, major oil producers or debtors, key US friends or allies, geograph-
ically close to the United States, or especially influential in the Third
World.
? Part 2 presents a more detailed analysis of select countries in which there
have been developments of special interest. Included in each assessment
are subsections listing indicators to be watched with reference to the
scenarios that we believe are most likely to unfold and alternative
scenarios.
~ Secret
GI IP! 86-002
May 1986
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Status of Key Indicators
Developments in
Legend
O
Negligible concern
First Quarter, 1986,
and Prospects
~
~
Low concern
Moderate concern
Substantial concern
Serious concern
?
Concern has increased since last quarter
?
Concern has decreased since last quarter
o
U
W
U
~~
W
~
>
U
~
'~
~~
y
b
~
N
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W 4. N
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00
ti u
V
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~~~ O
w Op
W~ y
~ id p
O
V .~ ~~
Latin America Mexico
?
O
O
O
EI Salvador
f?
~
Guatemala
~
Honduras
O
V
Panama
O
V
Colombia
O
~
Venezuela
O
O
O
O
O
O
O
Peru
~
~
V
Brazil
O
O
O
O
O
O
Argentina
~
O
O
Chile
Q
Europe Spain
O
O
O
O
O
O
O
Greece
O
~
~
~
~
~
~
Turkey
O
O
~
Ncar Fast and South Asia Morocco
O
O
O
O
EBYPt
?
O
O
?
?
`j ?
Sudan
~
~
~
~
?
~ ?
~
Saudi Arabia
O
O
O
O
Q
?
Iraq
~
~ ?
Iran
~
~
~
Pakistan
O
~
~
V ?
India
~
~
~
O
Africa Nigeria
~
~
~
~
O
~
~
~
Somalia
O
O
O
O
O
O
?
Kenya
~
~
O
Zaire
O
South Africa
O
O
Fast Asia Philippines O ? O O ? ? G
Indonesia O O O O O
Sou[h Korea O ? ? V V
308901 586
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Secret
Indications of
Political Instability
in Key Countries
Summary: The countries whose stability we are most concerned about this quarter
Levels of Concern continue to be concentrated in the volatile Near East-South Asia region
and in Central America:
? In Egypt, President Mubarak has muddled through since the police
mutiny in February, but public confidence in his leadership has been
shaken by the cumulative effect of a series of crises.
? The return of Benazir Bhutto to Pakistan in April has heightened
concern for stability there as she mounts a drive for new elections.
? The prospects for political turbulence in Sudan appear fairly high in the
near termespecially in view of the increased Libyan involvement
therealthough the fact that the military delivered on its promise of
elections in April was a good sign.
? Among the most significant developments in the quarter was the heavy
psychological blow to Iraq that came with Iran's capture of the Iraqi port
city of Al Faw and surrounding territory. Despite the setback, the ruling
Bath Party still appears to have some resiliency, and Tehran's victory
only temporarily eased war weariness in Iran-where substantial under-
lying discontent remains.
The threats to stability in Central America appear to be somewhat longer
term, but formidable economic difficulties are preoccupying many govern-
ments in the region now:
? Presidents Duarte in EI Salvador and Cerezo in Guatemala both have
come under sharp public criticism for their austerity programs. President
Delvalle in Panama also weathered a violent general strike sparked in
part by his regime's belt-tightening reforms.
? In Honduras, on the other hand, President Azcona-who has avoided
tough economic decisions-is under sharp public rebuke for being weak
and indecisive.
vii Secret
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? In Mexico the political-economic system is under serious strain as oil
prices drop, further aggravating the country's already massive debt
problem. In our opinion, a plan by the ruling party to use election rigging
to prevent opponents from exploiting these problems politically could
backfire, creating even greater instability in the longer term.
Elsewhere in Latin America, we remain concerned especially about:
? Peru, where terrorist bombings have increased and guerrillas are active,
and Chile, where both the Communists and the mainstream parties are
mounting campaigns against President Pinochet.
In Africa our concern continues at the highest level regarding:
? Nigeria, where President Babangida's regime has stumbled badly and
now is virtually under siege. The country continues to suffer from
factionalism that has fostered six coups since Nigeria became indepen-
dent in 1961.
In the Far East, our primary focus centers on:
? The Philippines-where the new government's problems are by no means
over-and South Korea, where opponents of President Chun Doo Hwan
have seized upon President Marcos's downfall to increase pressure on the
government.
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Part 1. Developments and Trends
The six categories of indicators used in the following
charts focus on a broad array of issues that may
impact on stability:
? The social Chang%ortfiict indicators examine devel-
opments such as labor or religious unrest that
could undermine the regime's legitimacy and ability
to rule effectively.
? The economic factors link various dimensions of
economic performance to potential instability.
? Opposition activities assess whether the opposition
can mobilize effective antiregime activity or carry
out acts that undermine public security.
? The military attitude/activities category addresses
the military's degree of dissatisfaction with regime
policies, involvement in coup plotting, and behavior
relevant to the political process.
? The external factors category looks at foreign influ-
ences that could affect internal stability.
? Finally, the regime capabilities/actions category
focuses on what the government is doing that could
lessen popular support, otherwise undermine its
authority, and affect its ability to govern efficiently.
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Mexicoe:
Selected Instability Indicators
Indicators Legend
longer term.
The ruling party appears intent this year on continuing a policy begun in
1985 of rolling back opposition electoral gains through the use of voting
irregularities. This year's elections begin in July and include 13 gubernato-
rial races, including three in northern states where the opposition believes it
could win in a fair vote. The government's tactics seem likely to result in in-
creased protests-which could turn violent. The authorities should be able
to contain any unrest with the support of the military, but we believe the
fraud could result in greater public alienation and be destabilizing in the
Prospects for major regime or policy change
During next six months
During next six months to two years
O Negligible concern
Low concern
Moderate concern
r Substantial concern
? Serious concern
1984
II III IV
1985
I II [II IV
1986
1
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
Economic factors General deterioration
?
?
?
?
?
?
?
?
Decreased access to foreign funds
O
O
?
Capital flight
?
?
?
?
Unpopular changes in taxes, subsidies, or price controls
?
Food/energy shortages
Inflation
?
?
?
?
?
?
?
?
Opposition activities Organizational capabilities
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
_
O
_
_
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
Ne
w cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
Loss of legitimacy
O
O
O
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EI Salvador:
Selected Instability Indicators
Indicators Legend
not be sufficient to restore either domestic or international confidence.
economic package survives this round of challenges intact, it probably will
President Duarte's economic austerity plan continues to provoke harsh
public criticism from the left and the right. But so far neither unions, the
private sector, nor opposition parties have been able to sustain widespread
protests. Duarte's willingness to compromise has softened the impact of the
program, and, in our view, his concern that opponents will be able to exploit
further belt-tightening suggests that more backsliding is likely. Even if the
Prospects for major regime or polity change
During next six months
V During next six months to two years
~ Negligible concern
Low concern
Moderate concern
V Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
?
?
?
?
?
?
?
?
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
Unpopular changes in taxes, subsidies, or price controls
?
?
?
Food/energy shortages
?
?
?
?
?
?
?
?
Inflation
?
?
?
Opposition activities Organizational capabilities
?
?
?
?
?
?
?
?
Opposition conspiracy/planning
?
?
?
?
?
?
?
?
Terrorism and sabotage
?
?
?
?
?
?
?
?
Insurgent armed attacks
?
?
?
?
?
?
?
?
Public support
Military attitudes/activities Threat to corporate military interests/dignity
?
Discontent over career loss, pay', or benefits
Discontent over government action/policies
?
Reports/rumors of coup plotting
?
External factors External support for government
?
?
?
External support for opposition
?
?
?
?
Threat of military conflict
New category
Regime actions/capabilities Repression/brutality
?
Security capabilities
?
?
?
?
?
?
?
?
Political disunity/loss of confidence
Loss of le itimacy
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Guatemala:
Selected Instability Indicators
Indicators Legend
populist course.
President Cerezo's austerity plan has provoked sharp criticism from busi-
ness and labor groups. There may be stronger protests, including sporadic
labor strikes and street demonstrations, once the impact of Cerezo's plan is
felt after implemention in May. High popular expectations that Cerezo will
produce an economic turnaround could erode his mandate in the mid- to
longer term. For now, Cerezo's pragmatic approach to reforms in human
rights and the security forces has reduced military and private-sector
concern that the Christian Democratic President would embark on a more
Prospects for major regime or polrry change
During next six months
During next six months to two years
O Negligible concern
Low concern
Moderate concern
~t+ Substantial concern
~' Serious concern
1984
II III IV
1985
I II 111 IV
1986
1
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
O
O
~
'
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
~
~
;q~.
Unpopular changes in taxes, subsidies, or price controls
O
O
O
~
N
'~
+Bs
~~'
Food/energy shortages
O
O
O
O
~
~
'~~
Inflation
O
O
O
O
O
"'1'
Opposition activities Organizational capabilities
O
O
O
O
O
O
Opposition conspiracy/planning
Terrorism and sabotage
Insurgent armed attacks
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
Discontent over government action/policies
Reports/rumors of coup plotting
External factors External support for government
External support for opposition
Threat of military conflict
New category
O
O
O
U
O
Regime actions/capabilities Repression/brutality
Security capabilities
O
O
O
Political disunity/loss of confidence
Loss of legitimacy
soe9oa s ee
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Honduras:
Selected Instability Indicators
Indicators Legend
economic issues dims near-term prospects for much-needed reforms.
the President's tenuous consensus on security policies-including support
for the anti-Sandinista insurgents. The government's avoidance of difficult
President Azcona does not appear in danger of being toppled within the next
few months, but domestic criticism of him as a weak and hesitant leader
almost certainly will continue. We believe that the armed forces' suspicion
of Ascona's competence and his "leftist" advisers will aggravate civil-
military relations, and political opponents in Congress may try to undermine
Prospects jor major regime or polity change
During next slx months
V During next six months to two }ears
O Negligible concern
Low concern
Moderate concern
~ Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
C
O
O
Demonstrations, riots, strikes
O
O
O
O
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
Opposition conspiracy/planning
Terrorism and sabotage
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
Reports/rumors of coup plotting
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
Threat of militarv conflict
New category
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
Loss of legitimacy
O
O
O
O
O
O
O
O
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Panama:
Selected Instability Indicators
Indicators Legend
the release of long-delayed funds.
President Delvalle's subservience to the military and improved prospects for
assistance from international lenders have bolstered the chances for his
political survival, at least for the near term. Delvalle, with powerful Defense
Chief Noriega's backing, pushed labor, agricultural, and industrial reforms
through the National Assembly in March. The package triggered a 10-day,
violence-marred general strike, but it demonstrated the willingness of the
regime-and the military-to try to address World Bank preconditions for
Prospects jor major regime or policy change
During next six months
~ During next six months to !wo years
O Negligible concern
Low concern
Moderate concern
V Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
C
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
Terrorism and sabotage
O
O
O
O
O
_
O
O
O
Insurgent armed attacks
O
O
O
O
O
_
O
O
O
Public support
O
O
O
O
O
_
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
~-
O
Reports/rumors of coup plotting
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
Ne
w category
O
O
O
O
_
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
0
0
O
Political disunity/loss of confidence
O
O
O
O
Loss of legitimacy
O
O
O
O
O
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Colombia:
Selected Instability Indicators
Indicators Legend
extend its influence.
President Betancur has tightened security nationwide to prevent large-scale
guerrilla disruptions, but urban terrorist attacks are likely before the 25
May presidential election. Despite heavy losses in atwo-month-long
insurgent offensive in rural southwestern Colombia, the M-19 group and its
allies continue to challenge the authorities there. The largest insurgent
group, the Revolutionary Armed Forces of Colombia, has again extended its
truce with the government, but continues recruitment and small rural
attacks. Meanwhile, its political front uses propaganda and threats to
Prospects jot major regime or polity change
During next six months
During next six months to two ,years
O Negligible concern
Low concern
Moderate concern
V Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
O
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
Opposition conspiracy/planning
Terrorism and sabotage
Insurgent armed attacks
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
Discontent over government action/policies
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
Threat of military conflict
Ne
w cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
O
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Secret
Venezuela:
Selected Instability Indicators
Indicators Legend
tive members of his party.
The severe drop in oil prices virtually assures a continuation of economic
stagnation into its eighth year in Venezuela. This situation, however, does
not threaten the country's entrenched two-party democratic system and is
unlikely to weaken President Lusinchi in the near term. There is no
significant social unrest, and organized labor remains a committed ally of
the ruling party. In our judgment, only a more severe and sustained
recession-perhaps as campaigning intensifies for national elections in
1988~ould undercut the standing of President Lusinchi and the conserva-
Prospects jar major regime or po/rcy change
O During next six months
O During next six months to two }ears
Negligible concern
Low concern
Moderate concern
V Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
O
O
O
O
Economic factors General deterioration
O
O
O
Decreased access to foreign funds
O
O
O
O
O
Capital flight
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
_
O
Inflation
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O,
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
C
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New category
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
O
308908 586
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 ? ,,. i. u _ ~,..~ ~ I_ ~ i ,, _,
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Secret
Peru
Selected Instability Indicators
Indicators Legend
persists.
President Garcia is still riding a popular crest after eight months in office,
but he faces some difficult challenges. Guerrilla activity continues unabat-
ed, and in February he declared a state of emergency in Lima following a
new wave of terrorist bombings. Peru's labor force is highly underemployed,
and Garcia's intransigence on debt repayments has further reduced the
availability of foreign credit needed for job-creating economic development.
Although Garcia has avoided confrontation with the far-left opposition and
mollified the military with pay raises and public praise, mutual mistrust
Prospects for major regime or polity change
During next six months
During next six months to two years
O Negligible concern
Low concern
Moderate concern
tiri Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
?
i
?
?
?
Economic factors General deterioration
?
?
?
?
?
?
?
?
Decreased access to foreign funds
?
?
?
?
?
?
?
?
Capital flight
?
?
?
?
?
Unpopular changes in taxes, subsidies, or price controls
?
O
O
Food/energy shortages
Inflation
Opposition activities Organizational capabilities
Opposition conspiracy/planning
O
O
O
Terrorism and sabotage
i
?
?
?
?
?
11
+i
Insurgent armed attacks
?
?
?
?
?
?
?
?
Public support
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
?
?
Discontent over career loss, pay, or benefits
Discontent over government action/policies
?
?
.@i
Reports/rumors of coup plotting
O
O
External factors External support for government
O
O
O
O
O
External support for opposition
O
O
O
O
Threat of military conflict
New category
O
O
O
O
O
Regime actions/capabilities Repression/brutality
?
?
?
?
Security capabilities
Political disunity/loss of confidence
?
?
?
?
O
O
O
Loss of legitimacy
?
?
?
a
O
O
O
O
308909 586
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Secret
Brazil:
Selected Instability Indicators
Indicators Legend
President Sarney is using his powers more freely to consolidate his political
base and combat high inflation. Increasingly self-confident, he has stream-
lined his cabinet and presidential staff; he made his boldest move since
taking office when he announced a sweeping austerity program in February.
The plan includes currency reform, a temporary wage and price freeze, and
gradual elimination of a pervasive indexation system. Sarney has won
widespread popular support for these moves, which should allow him to
retain the backing of the centrist majority and the military, while keeping
Prospects for major regime or polity change
O During next six months
During nex[ six months to two dears
O Negligible concern
Low concern
Modera[e concern
V Substantial concern
? Serious concern
1984
[I III IV
1985
I II III IV
1986
1
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
Unpopular changes in taxes, subsidies, or price controls
?
Food/energy shortages
O
O
Inflation
?
?
?
?
?
?
A
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New category
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
Loss of legitimacy
O
O
O
O
308910 586
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 ~. ~ , ,.
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Secret
Argentina:
Selected Instability Indicators
Indicators Legend
pressing the President for an amnesty.
President Alfonsin's popularity remains high because of his successful
inflation control program and the conviction of former junta members for
human rights abuses. To maintain his standing, however, we believe he must
spur economic growth by reducing the role of the inefficient public sector
and by improving the investment climate. Alfonsin also faces contentious
wage negotiations with an increasingly militant labor movement. In addi-
tion, the military remains concerned that more human rights trials-this
time prosecuting junior and middle-level officers-are in the offing and is
Prospects jor major regime or po/ity change
During next six mon[hs
During next six months to two years
O Negligible concern
Low concern
Modera[e concern
r Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
Economic factors General deterioration
Decreased access to foreign funds
~'
O
O
O
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
?
?
?
?
?
Opposition activities Organizational capabilities
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
Discontent over career loss, pay, or benefits
O
Discontent over government action/policies
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
O
306911 586
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Secret
Chile:
Selected Instability Indicators
Indicators Legend
in the past.
Both the Communists and the mainstream political parties plan sustained
campaigns against President Pinochet this year. The Communists intend to
carry out violent acts countrywide and are insisting that Pinochet can be
removed only through armed action. Most mainstream parties, frustrated
over Pinochet's refusal to negotiate on a transition to democracy, are
planning nonviolent protests, including a national strike. Some moderates
are cooperating with the Communists. Pinochet is determined to quell all
protests and has ordered the security forces to act even more vigorously than
Prospects for major regime or polrry change
During next six months
V During next six months to two }ears
O Negligible concern
Low concern
Moderate concern
Q Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
Demonstrations, riots, strikes
Economic factors General deterioration
Decreased access to foreign funds
?
?
?
?
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
Opposition activities Organizational capabilities
?
?
?
Opposition conspiracy/planning
Terrorism and sabotage
?
Insurgent armed attacks
O
O
O
Public support
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
Discontent over government action/policies
O
?
?
?
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
External support for opposition
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
Security capabilities
Political disunity/loss of confidence
O
O
Loss of le itimacy
308912 586
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 a ~,,..I a ~_ ~ i. .,, ~ _.,
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Secret
Spain:
Selected Instability Indicators
Indicators Legend
incidents in recent months.
Prime Minister Gonzalez's victory in the referendum on NATO member-
ship on 12 March reinforces his position as a favorite to win another term in
office in the national election that must take place by the end of the year.
He is likely to push hard this summer in talks with Washington to reduce
the US military presence in Spain. Madrid remains concerned about the
Basque terrorist threat, although there has been some slowing of violent
Prospects jor major regime or policy change
O During next six months
O During next six months to two }ears
O Negligible concern
Low concern
Moderate concern
Q Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
O
306913 5-86
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Secret
Greece:
Selected Instability Indicators
Indicators Legend
leader to mend the economy.
Prime Minister Papandreou is holding firm on the austerity plan he adopted
last fall, despite grumbling within his Socialist ranks and limited labor
unrest. Papandreou's efforts to turn the economy around have been
complicated by terrorist activity in the region, which has had a devastating
impact on Greece's tourist revenues. The economic difficulties do not
appear to be a destabilizing factor, however, or as yet even a serious political
vulnerability. Polls indicate that most Greeks blame world economic
conditions for Greece's troubles and still believe Papandreou is the best
Prospects for major regime or policy change
O During next .six months
O During nex[ six months to two years
O Negligible concern
Low concern
Moderate concern
V Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
O
O
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
Opposition activities Organizational capabilities
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
_
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New category
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
Political disunity/loss of confidence
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
308914 5-86
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Secret
Turkey:
Selected Instability Indicators
Indicators Legend
the United States
The government of Prime Minister Ozal retains its majority in parliament
despite continued public unhappiness with high inflation and unemploy-
ment. The impact of falling oil prices, however, may boost the government's
standing in time for possible parliamentary byelections next fall. Separatist
Kurdish terrorism remains worrisome-activity by Iraqi Kurds has surged
in step with Iranian advances in the Gulf war. Frictions continue with
Bulgaria, Greece, and Syria, and another concern for Ozal is Turkey's
failure so far to achieve its goals in ongoing defense and economic talks with
Prospects Jor major regime or polity change
During nex! six months
During next six months to [wo years
O Negligible concern
Low concern
Modera[e concern
~ Subs[antia! concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
O
O
O
O
O
O
O
Economic factors General deterioration
O
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
Unpopular changes in taxes, subsidies, or price controls
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
Opposition activities Organizational capabilities
Opposition conspiracy/planning
O
Terrorism and sabotage
Insurgent armed attacks
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
Regime actions/capabilities Repression/brutality
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
Loss of legitimacy
O
O
O
O
O
O
O
O
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Morocco:
Selected Instability Indicators
Indicators Legend
Financial difficulties continue to haunt Morocco despite a lower oil import
bill and breathing room provided by the recent debt rescheduling agree-
ment. Sales of Morocco's primary exports-phosphate and agricultural
goods-remain depressed, and large-scale aid from traditional Arab donors
is unlikely. The 30 percent of the urban population that is unemployed
provides a fertile ground for political unrest should these problems result in
significant shortages of essential goods or services. Nevertheless, we believe
the regime's security forces can contain the unrest as long as incidents
Prospects for major regime or polity change
During nex[ six mon[hs
During nex[ six months to two dears
O Negligible concern
Low concern
Moderate concern
s` Substantial concern
0 Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
Economic factors General deterioration
Decreased access to foreign funds
Capital flight
O
O
O
Unpopular changes in taxes, subsidies, or price controls
Food/energy shortages
O
O
O
O
O
O
O
O
InFlation
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
Discontent over career loss, pay, or benefits
Discontent over government action/policies
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
Regime actions/capabilities Repression/brutality
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
Loss of le itimacy
O
O
O
O
O
O
O
O
308916 586
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Secret
Egypte:
Selected Instability Indicators
Indicators Legend
of the standard of living and of Egypt's external financial position.
e See Part 2 for a more detailed discussion.
Cairo does not develop an effective strategy for handling Egypt's myriad
problems-in particular its economic difficulties-we expect opposition
activities by Islamic fundamentalist groups and others to intensify sharply.
Basic economic indicators are not encouraging, pointing to a further erosion
The Mubarak government has weathered the recent mutiny by security
police-its gravest crisis to date-but more troubles loom on the horizon. If
Prospects jor major regime or polity change
During next siz months
G During next six months to two years
O Negligible concern
Low concern
Moderate concern
~ Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
Demonstrations, riots, strikes
O
?
Economic factors General deterioration
Decreased access to foreign funds
O
?
Capital flight
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
?
?
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
Opposition activities Organizational capabilities
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
Terrorism and sabotage
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
O
308917 5-86
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Sudan:
Selected Instability Indicators
Indicators Legend
almost certainly will keep up pressure.
The Sudanese military, which seized power from Jaafar Nimeri a year ago,
delivered on its promise of elections in April. But the new civilian
government must immediately curb political factionalism or risk another
takeover by the armed forces. The regime-which most likely will be led by
moderate Muslim religious leader Sadiq Mahdi-probably can count on
Libyan and other Arab donors to provide a brief initial cushion against
acute shortages. Ramadan observances and summer heat may help limit
northern opposition activities until fall. The southern rebels, however,
Prospects for major regime or poJrry change
V During next six months
? During next six mon[hs to two Jears
~ Negligible concern
Low concern
Moderate concern
V Substantial concern
? Serious concern
1984
II III IV
1985
I Q III IV
1986
I
Social change/conflict Ethnic/religious discontent
?
?
?
?
?
?
?
Demonstrations, riots, strikes
?
?
?
?
?
Economic factors General deterioration
?
?
?
?
?
?
Decreased access to foreign funds
?
?
?
?
?
Capital flight
?
Unpopular changes in taxes, subsidies, or price controls
?
?
?
Food/energy shortages
?
?
Inflation
?
?
?
1
?
Opposition activities Organizational capabilities
?
?
?
?
?
?
O
Opposition conspiracy/planning
?
?
?
?
?
?
Terrorism and sabotage
?
Insurgent armed attacks
?
?
?
?
?
Public support
?
Military attitudes/activities Threat to corporate military interests/dignity
?
?
?
?
Discontent over career loss, pay, or benefits
Discontent over government action/policies
?
?
?
?
?
Reports/rumors of coup plotting
?
?
?
?
?
?
External factors External support for government
External support for opposition
?
?
Threat of military conflict
New category
Regime actions/capabilities Repression/brutality
p
Security capabilities
?
?
?
?
Political disunity/loss of confidence
?
?
?
?
Loss of legitimacy
?
308918 586
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Saudi Arabia:
Selected Instability Indicators
Outlook Although the Saudi Government remains firmly in control, reduced govern-
Riyadh is concerned about Iranian successes in the war with Iraq an
the possible spread of the conflict onto the Arabian Peninsula. Oil revenues
remain depressed, and the Saudi policy of defending a greater market share
has exacerbated tensions with Iran
Prospects for major regime or polity change
O During next six months
During next six months to two }ears
Indicators Legend
O Negligible concern
Low concern
Moderate concern
Q Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
O
O
O
O
O
O
O
Economic factors General deterioration
O
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
Terrorism and sabotage
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay", or benefits
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
Security capabilities
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
308919 586
25X6
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Iraq:
Selected Instability Indicators
Indicators Legend
now to support the regime of President Saddam Husayn.
Iran's crossing of the Shatt al Arab and capture of the deserted Iraqi port
city of Al Faw in February was a psychological blow to Baghdad. The
Iranians, however, have been unable to exploit their success militarily.
Meanwhile, Iraq's economic problems are mounting. Declining oil revenues
most likely will force some cutbacks in consumer goods and services,
contributing to morale problems and increasing the likelihood of civilian
unrest over the longer term. Even so, Iraq's political elite-the leaders of
the ruling Bath Party and Iraq's top military commanders-continue for
Prospects for major regime or polity change
+en During next six months
~ During nex! six months to two years
O Negligible concern
Low concern
Moderate concern
y Substantial concern
+~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
ilt
~
~.
,~
#~-
Demonstrations, riots, strikes
O
O
O
Economic factors General deterioration
O
O
O
O
?
Decreased access to foreign funds
~
Capital flight
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
Inflation
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
Terrorism and sabotage
s~;~
Insurgent armed attacks
O
~}
~
Public support
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
~
?
~
Threat of military conflict
Ne
w cate
gory
~
>p
~
Regime actions/capabilities Repression/brutality O O O O ~ 1! ';f>: +~
Security capabilities O O O
Political disunity/loss of confidence O O O O O O O
Loss of le itimacy O O O O O O O
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Secret
Iran:
Selected Instability Indicators
Indicators Legend
will intensify factionalism.
Although the regime remains firmly in control and enjoys the support of a
majority of the population, there is-in our judgment--considerable dissat-
isfaction beneath the surface. Tehran's capture of the Iraqi port of Al Faw
has temporarily eased war weariness, and there have been no overt
expressions of dissent, despite economic hardships. Nevertheless, we believe
continued low oil prices will force the regime to make even deeper cuts in
consumer and industrial imports-the regime slashed imports by one-third
in 1985-and that Khomeini's deteriorating health and the poor economy
Prospects jor major regime or polity change
V During next six months
V During nex[ six months to two dears
O Negligible concern
Law concern
Moderate concern
Q Subs[an[ia! concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
?
?
O
O
Economic factors General deterioration
?
?
?
Decreased access to foreign funds
?
?
Capital flight
?
?
?
?
Unpopular changes in taxes, subsidies, or price controls
?
Food/energy shortages
Inflation
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
Terrorism and sabotage
Insurgent armed attacks
Public support
Military attitudes/activities Threat to corporate military interests/dignity
Discontent over career loss, pay, or benefits
Discontent over government action/policies
Reports/rumors of coup plotting
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
?
?
?
?
?
Regime actions/capabilities Repression/brutality
Security capabilities
O
O
O
Political disunity/loss of confidence
Loss of legitimacy
O
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Pakistan:
Selected Instability Indicators
Indicators Legend
inspired campaign.
The return of People's Party leader Benazir Bhutto in early April probably
marks the end of the honeymoon for Prime Minister Junejo's new civilian
government. Bhutto has launched amonth-long drive calling for a new
election and President Zia's resignation as Army chief. Both her party and
the government have shown restraint so far, but massive rallies will test the
government's forebearance. Meanwhile, Islamabad has contained a signifi-
cant threat to stability-it appears to have regained the upper hand over
tribes along the Afghan border, which have been stirred up by a Soviet-
Prospects for major regime or policy change
During next six months
r During next six months to two fears
O Negligible concern V Substantial concern
Low concern ~ Serious concern
Moderate concern
1984
II III IV
1985
I 11 III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
Demonstrations, riots, strikes
O
O
O
O
?
Economic factors General deterioration
O
O
O
O
Decreased access to foreign funds
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
Inflation
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
?
Opposition conspiracy/planning
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
Threat of military conflict
New cate
gory
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
O
3ae9zz s se
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India:
Selected Instability Indicators
Indicators Legend
for his policies.
A resurgence of communal conflict and opposition-led demonstrations
against price increases have disrupted what had been steadily improving
stability under Prime Minister Rajiv Ghandi. Sikh militants have stepped
up killings of Sikh police as well as Hindus. Muslims have also clashed with
Hindus over government decisions affecting divorce law and a contested
mosque. Gandhi's success in restoring calm will depend heavily on his skill
in deploying security forces where they are essential-without further
alienating Sikh moderates-and more broadly on his ability to rally support
Prospects jor major regime or policy change
During next six months
During next six months to two years
O Negligible concern
Gow concern
Moderate concern
Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
?
?
?
?
Demonstrations, riots, strikes
Economic factors General deterioration
O
O
O
O
O
O
O
Decreased access to foreign funds
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
Terrorism and sabotage
?
Insurgent armed attacks
O
O
O
O
O
O
O
Public support
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
Discontent over government action/policies
Reports/rumors of coup plotting
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
Security capabilities
Political disunity/loss of confidence
O
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
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Nigeria'
Selected Instability Indicators
Indicators Legend
Muslim violence.
President Babangida's regime faces a financial crisis and a lack of political
direction that threaten its survival. Plunging oil prices have forced Lagos to
stop payment on its $19 billion debt in order to avoid devastating import
cuts and a politically explosive IMF austerity agreement. Economic deterio-
ration could strengthen discontent in the military and further erode the
regime's base of support-already battered by controversies over the
execution of 10 military coup plotters and a decision to join the Islamic
Conference Organization. The latter move has also provoked Christian-
Prospec[s for major regime or polity change
? During next six months
A During next six months to two }ears
O Negligible concern
Low concern
Moderate concern
Q Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
?
?
?
?
?
?
Demonstrations, riots, strikes
Economic factors General deterioration
?
?
?
?
?
?
?
?
Decreased access to foreign funds
?
?
?
?
?
?
?
?
Capital flight
Unpopular changes in taxes, subsidies, or price controls
?
p
Food/energy shortages
?
?
?
?
?
?
?
?
Inflation
?
?
?
?
?
?
?
?
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
?
?
?
?
?
?
?
?
Diswntent over government action/policies
?
?
?
?
?
?
?
?
Reports/rumors of coup plotting
?
?
?
?
?
?
?
?
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
Security capabilities
?
?
Political disunity/loss of confidence
?
?
?
?
?
?
?
?
Loss of le itimacy
?
?
?
?
?
?
?
?,
308924 586
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Somalia:
Selected Instability Indicators
Indicators Legend
endeavor.
President Siad continues to dominate the political scene. Nevertheless,
dissatisfaction with his policies among rival tribal groups continues to
simmer-the regime arrested several Air Force and Navy officers in April
for coup plotting. The President recently reshuflied several senior military
officers who are potential rivals. He has initiated talks with Ethiopia in an
effort to defuse border tensions and to end Addis Ababa's support to
guerrillas. Although this has generated some internal opposition, Siad
appears to have the general backing of the military and population for the
Prospects jor major regime or polity change
During next six months
During next six months to two dears
O Negligible concern
Low concern
Moderate concern
f~ Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
O
O
O
O
O
O
O
Economic factors General deterioration
O
O
O
O
O
O
O
O
Decreased access to foreign funds
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
Discontent over government action/policies
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
Threat of military conflict
New cate
gory
Regime actions/capabilities Repression/brutality
O
O
O
Security capabilities
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
O
308925 586
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Kenya:
Selected Instability Indicators
Indicators Legend
regional neighbors.
Unrest among the Kikuyu-Kenya's largest ethnic group---continues to
build. Kikuyu leaders resent President Moi's attempts to play on their
divisions and reduce their privileges. Several persons, mostly Kikuyus, were
arrested for antiregime plotting during the quarter, and other Kikuyus
reportedly set fire to the Nairobi City Hall. Nonetheless, the military-
where ethnic tensions are lower-appears able to contain the unrest. The
Moi government is also benefiting from high coffee revenues, record maize
and wheat harvests, low oil prices, and good relations with aid donors and
Prospects jor major regime or policy change
During next six months
During next six months to two years
O Negligible concern
Low concern
Moderate concern
Q Substantial concern
~ Serious concern
1984
II 1[[ IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
O
O
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
_
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
_
Opposition conspiracy/planning
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
O
O
O
Security capabilities
O
O
O
O
O
O
_
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of legitimacy
O
O
O
O
O
O
O
O
308926 5-86
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Zaire:
Selected Instability Indicators
Indicators Legend
role in facilitating US aid to UNITA.
The regime of President Mobutu is under no immediate threat. The
continued austerity measures outlined in the new IMF program for Zaire
may lead to expressions of discontent from labor and students-but a
serious challenge is not likely. Meanwhile, Libyan-US tensions in recent
months have heightened concern in Kinshasa that Tripoli may sponsor a
terrorist attack in Zaire. Mobutu also is concerned increasingly that Angola
may renew support to Zairian dissidents in retaliation for Zaire's suspected
Prospects jor major regime or po/rcy change
During next six months
During next six months !o two dears
O Negligible concern
Low concern
Moderate concern
V Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
O
O
O
O
O
O
Economic factors General deterioration
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
Food/energy shortages
O
O
O
Inflation
Opposition activities Organizational capabilities
Opposition conspiracy/planning
Terrorism and sabotage
O
Insurgent armed attacks
O
O
Public support
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
Threat of military conflict
New cate
gory
O
Regime actions/capabilities Repression/brutality
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
Loss of legitimacy
O
O
O
O
308927 5A6
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South Africa:
Selected Instability Indicators
Indicators Legend
stem the rise in black unemployment.
Antigovernment violence and demonstrations are likely to increase as blacks
commemorate the 10th anniversary of the Soweto riots in June. We do not
believe that the limited reforms enacted by Parliament this session-
including revision of laws affecting movements by blacks in the country-
will satisfy blacks. An agreement with foreign creditors to defer most of
South Africa's debt principal repayments through June 1987 probably will
temporarily increase access to foreign funds. The economy is poised for a
modest recovery, but any upturn is unlikely to be of sufficient magnitude to
Prospects jor major regime or polity change
During next six months
During next six months to two years
O Negligible concern
Low concern
Moderate concern
O Substantial concern
? Serious concern
1984
II III IV
1985
I II III IV
1986
1
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
?
?
?
?
?
?
Economic factors General deterioration
O
Decreased access to foreign funds
O
O
O
O
?
?
Capital flight
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
O
Terrorism and sabotage
O
O
Insurgent armed attacks
O
O
O
~J
O
O
O
O
Public support
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New category
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
?
?
?
?
?
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
O
308928 5-86
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Philippines:
Selected Instability Indicators
Indicators Legend
cease-fire.
President Aquino will face growing opposition as public euphoria over her
ascension to power fades. Although economic prospects have improved,
significant growth and gains in living standards are not likely before early
1987. Protests-such as those prompted by Aquino's efforts to replace
officials elected in the Marcos era, her abolition of the legislature, and rule
by decree-are likely to intensify if the new administration fails to make
progress on economic and social issues. The Communists will probably
maintain current levels of attacks despite government efforts to negotiate a
Prospects for major regime or policy change
During next six months
~ During next six months to two dears
O Negligible concern
Law concern
Moderate concern
~ Substantial concern
? Serious concern
1984
II III IV
1985
I II III [V
1986
I
Social change/conflict Ethnic/religious discontent
Demonstrations, riots, strikes
O
Economic factors General deterioration
?
?
?
?
?
?
Decreased access to foreign funds
?
?
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
?
?
?
?
?
O
Food/energy shortages
O
O
O
O
Inflation
?
?
?
O
O
O
Opposition activities Organizational capabilities
Opposition conspiracy/planning
O
O
O
O
O
O
O
Terrorism and sabotage
Insurgent armed attacks
?
?
?
?
Public support
?
?
?
?
?
?
?
Military attitudes/activities Threat to corporate military interests/dignity
O
O
Discontent over career loss, pay, or benefits
Discontent over government action/policies
?
?
?
Reports/rumors of coup plotting
O
O
O
O
O
O
O
External factors External support for government
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
O
O
O
Security capabilities
Political disunity/loss of confidence
?
O
Loss of legitimacy
?
?
?
?
?
?
?
O
308929 5-86
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Indonesia:
Selected Instability Indicators
Indicators Legend
Aline on the political opposition
The sharp decline in world oil prices has forced Jakarta to implement
further financial austerity and may force additional cuts in the current
budget-already the most austere since the early 1970s. As the cuts and
capital flight reduce chances for economic growth, rising unemployment
could increase sdcial and political discontent. The Sceharto government,
however, remains firmly in control with full support of the military and, in
preparation for the 1987 parliamentary election, will enforce strict disci-
Prospects jot major rcgrme or pdrry c/mnge
O During next six months
During next srx months to [wo dears
O Negligible concern
Low concern
Moderate concern
V Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
Demonstrations, riots, strikes
O
O
O
O
O
Economic factors General deterioration
O
O
O
O
O
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
O
O
O
O
O
O
Opposition conspiracy/planning
O
O
O
O
O
O
Terrorism and sabotage
O
O
O
O
O
O
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
O
O
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
O
O
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
O
O
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
O
O
O
O
O
O
O
O
Threat of military conflict
New cate
gory
O
O
O
O
O
Regime actions/capabilities Repression/brutality
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
O
O
O
O
O
Loss of le itimacy
O
O
O
O
O
O
O
O
aoee3o s ae
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South Korea':
Selected Instability Indicators
Indicators Legend
to tighten controls.
His European trip behind him, President Chun is grappling with how to rein
in opponents who-in the wake of Marcos's downfall-have accelerated
efforts to force Chun to concede to a direct presidential election in late 1987
or early 1988. Opposition rallies appear to have hit a plateau, but church,
academic, and other opinion leaders are likely to complicate Seoul's efforts
to discredit the movement. Despite Chun's concern about retaining US
support, he may use an expected upsurge in student protests, especially
around the anniversary in May of the bloody 1980 Kwangju disturbances,
Prospects for major regime or polity change
V During nex( six months
~ During next six months to two dears
Q Negligible concern
Low concern
Moderate concern
Q Substantial concern
~ Serious concern
1984
II III IV
1985
I II III IV
1986
I
Social change/conflict Ethnic/religious discontent
O
O
O
O
O
O
O
O
Demonstrations, riots, strikes
?
?
?
?
?
?
Economic factors General deterioration
O
O
O
O
O
Decreased access to foreign funds
O
O
O
O
O
O
O
O
Capital flight
O
O
O
O
O
O
O
O
Unpopular changes in taxes, subsidies, or price controls
O
O
O
O
O
O
Food/energy shortages
O
O
O
O
O
O
O
O
Inflation
O
O
O
O
O
O
O
O
Opposition activities Organizational capabilities
O
O
Opposition conspiracy/planning
Terrorism and sabotage
Insurgent armed attacks
O
O
O
O
O
O
O
O
Public support
O
O
O
Military attitudes/activities Threat to corporate military interests/dignity
O
O
O
Discontent over career loss, pay, or benefits
O
O
O
O
O
O
O
O
Discontent over government action/policies
O
O
O
Reports/rumors of coup plotting
O
O
O
O
O
O
O
O
External factors External support for government
O
O
O
O
O
O
O
O
External support for opposition
Threat of military conflict
New category
O
O
O
O
O
Regime actions/capabilities Repression/brutality
O
O
Security capabilities
O
O
O
O
O
O
O
O
Political disunity/loss of confidence
O
O
O
Loss of le itimacy
306931 586
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Part 2. Countries With
Developments of Special Interest
Nigeria: Babangida's
Fall From Grace
plotting have continued to circulate.
? The four-month honeymoon for President Baban-
gida, whose regime began with the promise of a
more open and consensual style of politics last year,
came to an abrupt end in January when his security
forces received reports that a new coup attempt was
being planned. Three hundred military officers and
civilian suspects were rounded up; rumors of coup
of financial default.
? After nearly a year in power, the government has
yet to address, or even clearly define, most of the
country's staggering economic and social problems.
The bureaucracy is in disarray, and Babangida's
indecisive style is attracting widespread criticism.
Nigeria's financial crisis has deepened during the
past three months as falling oil prices have slashed
export revenues and pushed the country to the brink
protests and retaliatory Muslim violence.
The regime's decision to join the Islamic Conference
Organization has provoked nationwide Christian
has generated six coups in the past 25 years.
? Babangida's efforts to forge a national consensus-
by inviting public debate over national issues and
committing himself to improving human rights-
seem to be failing. Nigeria continues to be riven by
the ethnic, regional, and religious factionalism that
Armed Forces Divided, Poeticized, and Tense
President Babangida's power rests increasingly on his
popularity with the armed forces-but at a time when
the Nigerian military has become dangerously divided
and politicized. In our judgment, the breakdown of
professional standards, particularly the military's re-
neging on its commitment to stay out of politics, has
turned the only institution capable of ensuring govern-
ment stability into its most formidable enemy. The
armed forces reflect the social, regional, ethnic, and
class divisions within the general population. US
Embassy reporting indicates that tensions are particu-
larly acute between lower ranks, who claim to have
been unfairly penalized by austerity cutbacks, and
senior-grade officers who have already profited from
their privileged access to promotions, patronage, and
kickbacks.
Although plotting against the government has become
endemic in the Nigerian military, the President may
have bought himself a breathing space by his decisive
action earlier this year against a cabal of Air Force
and Army officers planning to take over the govern-
ment after bombing the capital. Ten conspirators,
including a member of the Armed Forces Ruling
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Council, were executed to deter further antigovern- will continue to erode the regime's stability and could
ment activity. In the wake of the regime's crackdown, help trigger yet another round of plotting by the
the pressure of a third year of debilitating economic
austerity. The plunge in world oil prices, coupled with
Nigeria's rejection of an IMF agreement early this
year and subsequent failure to reschedule its foreign
obligations, has resulted in a halt to commercial debt
repayments, shortages of basic commodity imports,
inflation, and steadily rising unemployment. Although
commercial banks eventually may agree to reschedule
about a fourth of Nigeria's total $5.4 billion obliga-
tions for 1986, US officials report that oil export
income-which accounts for 97 percent of the govern-
ment's foreign exchange earnings--could decline to
less than $7 billion this year, barring a major rebound
in prices. We believe that economic decay probably
25X1
25X1
LJ/~ I
Babangida and his advisers have
according to US Embassy
sources-have added substantially to the security
forces stationed in and around Lagos.
Within the military, the President is particularly
dependent on the loyalty of a small coterie of middle-
grade officers who brought him to power and now
hold important Cabinet positions and command mili-
tary units essential to defending the capital city. As
preoccupation with security has grown, this group's
power has begun to rival that of Babangida himself.
According to the US Embassy, the group has outvoted
the President on several key issues this year. As power
has shifted to this group, the government's official
ruling councils and the bureaucracy are increasingly
ineffective, leaving the day-to-day running of the
government in disarray. No one speaks authoritatively
for the regime on foreign policy or economic reform.
Corruption-the issue that brought down the last
civilian government~ontinues to flourish.
Economic Decay Erodes Stability
The regime's lack of direction and obsession with
security have, in our view, overwhelmed plans to deal
with Nigeria's longstanding economic and social prob-
lems. The government's most pressing challenge is the
rapidly deteriorating economy. All segments of the
population, including the military, already are feeling
military.
Hoping to attract Arab aid, Nigeria joined the Islam-
ic Conference Organization this January. We believe
that President Babangida saw this as a means of
reassuring Nigeria's northern Muslim leaders, who
have traditionally dominated the government and
have a diminished role in this regime. He has distrib-
uted government offices evenhandedly among ethnic
factions previously excluded from power, and his
regime is not closely tied to any of Nigeria's principal
ethnic or regional elites. He himself comes from one
of Nigeria's minority-controlled central states and is
of mixed ethnic background.
To Nigeria's southern Christian community, joining
the Islamic Conference indicated agovernment-sup-
ported radical Muslim plot to turn Nigeria into an
Islamic state. The Christians immediately began na-
tionwide antigovernment demonstrations that could
ignite an explosive confrontation with elements of the
country's Muslim majority. Some northern Muslim
groups are heavily influenced by Libya and Iran.
There have been major incidents of violence over the
past few years that have taken thousands of lives and
required the intervention of the Nigerian Army to
suppress. Religious controversies risk activating
broader rivalries between Nigeria's large ethnic and
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regional groupings, as happened during the Biafra
civil war, and could shatter Nigeria's fragile
ed commodities become increasingly severe.
Most Likely Scenario: Babangida muddles through
the next six months or so.
? The regime becomes increasingly embattled as mili-
tary discontent grows.
? The concentrated military strength of the Baban-
gida coterie neutralizes antigovernment activity by
other factions in the armed forces.
? Real or imagined coup plots are put down with
increasing severity alienating involved ethnic and
religious groups.
? Controversy over the Islamic Conference is dif-
fused-for the Christians by not attending meet-
ings, and for the Muslims by continuing Nigeria's
membership.
? President Babangida is unable to muster enough
support to pursue his own policy agenda but must
compromise with militants among his inner circle of
supporters.
? Nigeria ceases to pay most of its debts, without
repudiating them outright, and shortages of import-
ships provoke heavyhanded military reprisals.
Alternative Scenario: BabangidaJaces a serious chal-
lengeJrom within the military and growing unrest
within the civilian population-and is overthrown.
? Members of the President's inner circle become
frustrated with Babangida's indecisiveness and with
their share of diminishing economic spoils.
? Commanders of Lagos-based military units move
against the President, possibly by sponsoring an
assassination attempt.
? Violence associated with the coup attempt sparks
confrontations between ethnic or religious groups.
? Rising levels of civilian protest over economic hard-
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Egypt: Mubarak's
Troubles Mount
? Public confidence in President Hosni Mubarak's
leadership has been severely shaken by his ineffec-
tive handling of a string of recent crises, in our
judgment, and he is being blamed by an increasing-
ly vocal opposition for government paralysis and
infighting.
? The mutiny of police conscripts in February under-
scored the importance of the Army for maintaining
order and may give the generals a greater voice in
running the country. It also pointed up the explosive
potential of Islamic fundamentalism in Egypt.
? The precipitous drop in world oil prices could cost
Egypt up to $1.2 billion annually, further aggravat-
ing its already rapid economic decline.
? Although opposition to Mubarak is not yet strong
enough to topple him, we believe it will continue to
grow because Mubarak appears unable to cope with
Egypt's seemingly intractable problems.
The President has been seriously weakened, in our
view, by the series of recent crises-which include the
Achille Lauro hijacking, the bloody commando attack
in Malta, and the controversial death of an Egyptian
policeman convicted of murdering Israeli vacationers
in the Sinai. In addition, more demonstrations have
erupted in the past five months than in as many years.
In our view, these events have put Mubarak on the
defensive and have sapped his ability to govern in the
forceful style Egyptians expect. US Embassy report-
ing indicates that public confidence in his leadership
has begun a downward slide from which it may not
fully recover.
President Mubarak's objectives since coming to power
in 1981 have included modernizing Egyptian politics
and society. His moves to foster democracy have
made Egypt one of the most open societies among the
~"~ " Medi~-rr~sn ~^ea
~ ~-
E9YPt
Red
~ Sea
a - ~so~. ,
~ `-, BwawA?ry ,
Arab states. There is broad freedom of expression in
Cairo and extensive opposition party activity, which
have been well received by urban, middle-class Egyp-
tians. The positive thrust of Mubarak's policies, how-
ever, has been offset, in our view, by deepening
paralysis within the Egyptian Government that is
largely of his own making.
25X1
25X1
Mubarak's insistence on maintaining control of deci-
sionmaking continues to discourage initiative at the
Cabinet level, according to the US Embassy. Yet,
because of his direct role in day-to-day administra-
tion, he increasingly is being blamed for government
drift and incompetence. Egypt's Prime Minister Lutfi,
a prominent economist and Mubarak's personal
choice for the position, has proved incapable of con-
trolling Cabinet infighting and implementing coher- 25X1
ent policies-faults that we believe have cost him and
Mubarak a large measure of public respect.
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Police Mutiny Gravest Crisis
We believe the sudden and violent police mutiny last
February-Mubarak's gravest domestic crisis-has
especially dangerous implications for his government.
The deeply frightened Egyptians gave Mubarak fairly
high marks for his firm handling of the rebellion-in
contrast to his performance in earlier crises. However,
US Embassy analysis suggests that his indebtedness
to the Army and to ambitious Defense Minister Abu
Ghazala for their rapid, decisive support serves to
detract further from the effectiveness of Mubarak's
presidency. Until the police force is rebuilt, we believe
the generals may counsel avoidance of unpopular
economic reforms that risk additional unrest. Mean-
while, Abu Ghazala's position as Mubarak's leading
contender for power has been substantially enhanced.
The riots also underscore the increasingly fragile
nature of Egyptian stability. Hard evidence that
Muslim extremists conspired to trigger the uprising is
lacking. Nonetheless, the selective nature of the tar-
gets-tourist hotels and nightclubs-and the virtually
simultaneous spread of the rioting to other cities with
significant fundamentalist populations strongly sug-
gest that hardcore Islamic leaders were well prepared
to exploit and channel the discontent. We believe the
lack of an effective police force during its rebuilding
process may embolden extremists to foment new
judgment, to result in violence.
The disturbance strongly suggests that Egypt's poor-
est classes-from which the police conscripts are
drawn-would be susceptible to fundamentalist ap-
peals for protests in reaction to any further severe
deterioration of economic conditions. Even without
fundamentalist involvement, however, the growing
impoverishment of these classes appears likely to
generate latent unrest, needing only a rumor, in our
Signs of a long, hot summer already exist. In late
March, students in Asyut-a hotbed of Islamic fun-
damentalism--defied police demands to remove Is-
lamic posters. In the ensuing melee, one student was
shot; others vandalized a Coptic Christian shop. Mu-
barak's decision to evacuate the wounded student to
Cairo mollified the crowds for the moment. New
disturbances could turn into bloody interconfessional
clashes if the wounded student, who remains in
critical condition, dies.
The Mubarak regime believes that it can keep most
militant fundamentalist leaders in check, according to
US Embassy reports. Nonetheless, Cairo remains
concerned that large numbers of Egyptians, embit-
tered by worsening living standards, might use Islam
to justify antiregime riots.
We remain concerned, however, about Egypt's short-
term economic outlook. Basic economic indicators
point to further erosion of Egypt's external financial
position. Petroleum revenues are likely to decline to
$1.2 billion, or roughly one-half of last year's earn-
ings. Other major sources of foreign exchange-
especially worker remittances-also are headed down-
ward.
Mubarak's most immediate and critical dilemma, in
our view, grows out of these severe economic prob-
lems. The comprehensive austerity measures recom-
mended by the IMF to rebuild infrastructure and
form a basis for real economic growth would almost
certainly foster increased political unrest. Our analy-
sis indicates that Mubarak lacks the confidence need-
ed to press ahead decisively with such reforms. The
disturbances.
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bread riots of 1977 made a deep impression on
Mubarak, and he wants to avoid any measures that
might risk a repetition of that violence.
The reform measures announced by the government
in late March fall considerably short of what is
required to deal with the economic crisis. Shortcom-
ings in the reform package include:
? No mention of any progress toward a unified ex-
change rate; no significant energy price increases.
? No specific measures to curb imports or boost
exports by undertaking structural reform of the
subsidy system or by revamping the inefficient
public-sector industries.
The foreign banking community's confidence in
Egypt's ability to service short-term debt could erode
to such an extent during 1986 that it would trigger
foreign banks into cutting their short-term lending to
Egypt. If this occurs, Cairo will be hard pressed to
finance immediate import needs, and afull-blown
crisis would develop.
Most Likely Scenario: Mubarak muddles through.
? Government revenues decline, but Mubarak's refus-
al to impose severe price increases forestalls demon-
strations and riots.
? Even if some demonstrations break out, they are
quickly contained.
? Opposition criticism continues but reflects restraint;
policies, not the President, are the target.
? The military remains loyal and in the background.
Alternative Scenario: Mubarak's position
deteriorates significantly.
? Government revenues decline. In response, Mu-
barak cuts subsidies on some basic commodities,
and strikes and demonstrations start to multiply.
? Muslim-Coptic Christian violence erupts in Cairo
and in other cities.
? Opposition criticism mounts, eliciting threats of or
an actual government crackdown on opposition
activity. 25X1
? Military leaders start to grumble about the threat to
public order.~~ 25X1
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South Korea: Foes Call
Chun Another Marcos
? Citing parallels between South Korea and the Phil-
ippines, opposition leaders have escalated their rhet-
oric, warning that President Chun Doo Hwan-like
Marcos-may be removed by "people power."~
? There are, in our view, several key differences
between the situations in South Korea and the
Philippines. Most important, in South Korea the
economy is basically healthy; the powerful military
remains loyal so far; Christian activists are less
influential; and most South Koreans view North
Korea as a potentially more dangerous threat than
the Communist insurgents in the Philippines.
? Nonetheless, the largest opposition-sponsored rallies
in ayear-supporting direct presidential elections-
have taken place recently, and one attempted rally
resulted in large-scale violence in Inchon. If such
protests continue-and the potential for violence is
probably greatest on the 17-27 May anniversary of
the Kwangju disturbances of 1980-Chun might
reinstate tough political controls.
? We believe that an escalating series of challenges
and harsh government reactions presents the great-
est danger to stability. Chun has shown an ability in
the past to step back from the brink. If he is
inflexible in a future crisis, a few Army leaders
might support him, but we believe that backing
from other senior officers would be uncertain.
The collapse of the Marcos regime has had a galva-
nizing impact on political developments in Seoul. In
February, immediately following Marcos's departure,
President Chun met for dialogue with opposition
party leaders and ended visible suppression of the
opposition's petition drive for direct election of his
successor. Chun apparently sought to avoid US criti-
cism of his own government and to forestall sour notes
during his visit to Europe in April.
In a second meeting with opposition leaders late last
month, Chun further conceded that he would allow
constitutional reform during his term if the National
Assembly recommends it. His position long had been
that a resolution of the election reform issue must
wait until after a "peaceful" change of government
when Chun's term ends and the country has hosted a
successful Olympic Games in 1988.
Chun's latest statement appears to be aimed at con-
taining the reform issue in the National Assembly-
where the ruling party can block real movement-and
at convincing the opposition to end its rallies and
signature campaign. The government may also hope
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~r (1822)~j
LEcN '~~'~o `yJo~oT
Good grieJ7lt's cold!
Is spring coming or not?
It has already arrived in the
south.
that the riots, which occurred subsequently in Inchon,
will help its case by adding credibility to its contention
that the opposition is encouraging "social chaos."
The President's gestures have not succeeded in lower-
ing political tensions. On the contrary, the opposition
New Democratic Party-emboldened by events in
Manila-seems intent on leading a popular campaign
for election reform that puts it on a collision course
with the government.
For the moment, the more moderate opposition lead-
ers are in a quandary, according to the US Embassy
in Seoul, over how to proceed tactically. They are
dismayed by the violence in Inchon, but they cannot
afford to alienate the radical students and workers,
who sparked the events there and who have served as
useful tools of the opposition in the past.
We believe that the opposition leadership will contin-
ue to press the reform issue, in part to avoid falling
too far behind the radical elements. Chun's adversar-
ies almost certainly want to capitalize on his enor-
mous unpopularity and widespread suspicion that he
will renege on his promise to step down, or will
attempt to exercise power through a surrogate. Bat-
tling over this issue is likely to dominate the political
scene during the next two years.
Also militating against any genuine compromise are
the old scores that opposition leaders Kim Young Sam
and, in particular, Kim Dae Jung have to settle with
Chun, in addition to longstanding presidential ambi-
tions of their own. Chun and his inner circle-like
Marcos and his cohorts-probably see the issue as
threatening not only their political power, but also
their ability to continue to live in Korea with security
and dignity.
Although Christian activists remain a minority within
a minority in Korea, some individual leaders are
influential. A homily by Catholic Cardinal Kim, a
widely respected moderate, has weakened government
claims that the signature campaign is subversive,
according to the US Embassy; and several large
churches have begun to collect signatures among
parishoners. More than 400 professors at the most
prestigious universities also have issued statements
supporting democratization and defending the peti-
tion drive, and support is growing among students-
despite their cynicism toward politicians of all stripes.
Opposition leaders may calculate that Chun's concern
for his image as the country prepares to host the
Asian Games later this year will keep him from
cracking down. Moreover, in the view of the US
Embassy in Seoul, they may judge that if Chun
resorts to repressive measures the result will work to
their advantage, fomenting further discontent and
bringing more intense foreign prodding that will
undermine his ability to deal with future challenges.
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Opposition leader Kim Young Sam addresses
signature campai n rally in KwangJu on 30
March 1986.
Comeback Trail for Kim Dae Jung
Kim Dae Jung has been a driving force behind the
focus on an extraparliamentary struggle, and he
probably stands to benefit most from the petition
drive. Although fellow opposition leader Kim Young
Sam has been the main speaker at the rallies, Kim
Dae Jung's carefully staged efforts to go to each
event, only to be turned back by a police cordon,
contribute to the impression that the government
considers him its most formidable challenger.
We expect Kim Dae Jung's supporters to step up
efforts in coming months to build international back-
ing for the reinstatement of Kim's political rights-
thereby allowing him formally to become a member of
the party. Many observers expect him then to chal-
lenge Kim Young Sam openly for the leadership.
A number of opposition politicians believe that the
extraparliamentary campaign is risky in that it invites
harsh government retaliation. They see it as an
extension of the thinly concealed rivalry between Kim
Dae Jung and Kim Young Sam, who is losing much of
his reputation as a moderate as he tries to match
stride with his more hardline colleague, according to
sources of the US Embassy in Seoul. Concern about
being criticized as government pawns, as well as the
government's apparent deafness to moderate voices
even within the ruling camp, has discouraged advo-
cates of greater flexibility from speaking out.
Concern about possible US criticism~fficial or un-
official- probably will incline Chun toward caution
in fashioning his tactics. US criticism could be unset-
tling for Chun particularly if it could be read by
Army leaders as weakening US security guarantees.
Chun probably sees a need to project a strong image,
however, in order to discourage challenges to his
authority by military leaders and members of his own
ruling party. As a result, he may feel compelled to
move fairly aggressively to quiet dissent in hope of
forestalling incidents that could mar the Asian Games
this fall and play into the hands of North Korean
efforts to cast a pall over the 1988 Seoul Olympics.
Most Likely Scenario: The opposition movement
gradually builds momentum; Chun uses a combina-
tion of tactical concessions and tougher controls to
preempt possible disruption ojthe 1986 Asian Games.
? Chun's adversaries expand demonstrations and civil
disobedience, and gain support from additional non-
partisan opinion leaders.
? The security services gradually stiffen their posture,
stepping up intimidation tactics against supporters
of reform.
? At the same time, the President agrees to discuss
political reform issues in a variety of forums, but
offers no solid commitment to change.
Alternative Scenario 1: Chun, believing his grip on
the succession process is rapidly weakening, moves
aggressively against opponents-who also press
hard-setting the stage jor a full crisis and almost
certain Army intervention.
? Chun steps up intimidation tactics; reports of police
brutality increase; he declares emergency measures
sharply limiting opposition activities.
? The government also attempts to implicate opposi-
tion party leaders in violent protest actions by
allegedly pro-Communist radicals.
? The opposition expands antigovernment demonstra-
tions; clashes between security forces and protestors
continue to escalate, resulting in significant
casualties.
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? Fearing ever widening political upheaval, some
Army leaders move to restore stability, replace
Chun with one of their own.
Alternative Scenario 2: To avoid a political crisis
over the succession issue, the government attempts to
partially meet demands,lor democratization.
? Many respected social, academic, and business lead-
ers call publicly for both sides to negotiate a
compromise on constitutional reform.
? Opposition leaders, amid growing criticism from
their own supporters, soften their position and agree
to negotiate without major preconditions.
? Senior ruling party officials suggest some room
exists for compromise on the succession question.
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Secret
Mexico: Election Irregularities
May Backfire
? Mexico's ruling party, which has governed the
country with remarkable strength and resiliency for
nearly 60 years, is experiencing significant stress as
the recent drop in world oil prices compounds the
country's already massive debt problem.
? Signs that economic difficulties were having an
impact on politics were evident last year when the
party relied on blatant fraud and intimidation to
maintain its virtual monopoly of power in a series of
gubernatorial elections.
? Beginning this July, 13 more gubernatorial elections
will be held, and there are strong signs that the
party will again rely on fraud and a show of military
force, where necessary, to win.
? The government of President de la Madrid almost
certainly can contain any violence prompted by this
strategy, but we and the US Embassy believe that
the alienation fostered could spark growing popular
election
Stete `boundary
austerity in 1985, however, and appears reluctant to
reinstate and strengthen such measures this year.
unrest over the longer term.
Backdrop: A Troubled Economy
Foreign debt in Mexico-the country that set off the
Third World debt crisis four years ago-is now
approaching $100 billion, just behind the leading
Third World debtor nation, Brazil. In attempting to
meet the payments on this debt, the Mexicans have
depended largely on oil, which accounts for 70 per-
cent of its export earnings. Last year, however, the
price of Mexican oil dropped by nearly 30 percent per
barrel, and in the past three months the price was
nearly cut in half.
The economic impact of these events has been harsh.
The ruling Institutional Revolutionary Party (PRI),
led by President de la Madrid, began an austerity and
limited economic reform program when the interna-
tional debt crisis began in 1982. De la Madrid relaxed
Recently, in Monterrey-Mexico's third-largest
city-the government rolled back gas prices following
monthlong public protests. We believe the economic
downturn has hurt the man in the street. Moreover,
based on its actions, the government almost certainly
considers that the potential for serious political conse-
quences is thereby increased.
The PRI last year revived its traditional strategy of
allowing virtually no opposition electoral victories at
any level throughout the country. The party sought, in
particular, to deny the strongest opposition party, the
National Action Party (PAN), any successes and to
roll back opposition gains scored in 1982 and 1983.
Although opposition parties won in a few races last
year, their overall share of elected positions was
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Although these races could be close, we believe the
PAN would have a chance at winning only Chihua-
reduced, and their few victories included no signifi-
cant posts, such as state governor or mayor of a major
city.
PRI victories, particularly in hotly contested areas,
were assured by the use of fraud and questionable
campaign techniques. Press and Embassy reports
indicate these tactics included the alteration of voter
registration lists, disqualification of opposition candi-
dates, and theft or stuffing of ballot boxes. Public
disapproval of the increased fraud was evident from
the decreased voter turnouts in opposition strongholds
during elections late last year. The PAN also reacted
to electoral inconsistencies with protests that have
continued this year and, at times, become violent.
Several knowledgeable PRI officials have told US
Embassy officers that the government has determined
it will win most of the 1986 gubernatorial races this
summer, using significant fraud where necessary.
Changes in election laws, vote manipulation, and use
of the military also will be used to assure the contin-
ued domination of the ruling party.
Even if fraud is not extensively utilized or needed to
assure victory, however, the PAN most likely will
claim the elections were stolen, particularly in the
three northern states where it is strongest. The PAN
claims that, in a fair election, it could win the
governorships of Chihuahua, Durango, and Sinaloa.
hua in a fair election.
Although not an election irregularity as such, candi-
dates from both the ruling and opposition parties have
charged their opponents with corruption and ties to
narcotics traffickers. In our opinion, these charges
will not be a key factor in this year's elections. If the
narcotics problem continues unchecked, however, the
possibility of traffickers and drug-related corruption
having direct influence within the political process
will increase in the long term.
The PAN stronghold of Chihuahua, which along with
Durango will be the first to hold elections on 6 July, is
the key for determining the government's tactics and
the likelihood of unrest during and after this year's
races. The PAN currently controls seven of Chihua-
hua's largest cities, including the capital, which con-
tain over 70 percent of the state's population. More-
over, the PAN made its strongest showing in
Chihuahua during the midterm congressional elec-
tions last July.
The PRI's actions in Chihuahua have already provid-
ed some indication of the techniques they will use.
Late last year in Chihuahua, the PRI-controlled state
administration amended election laws that should
make it easier for the ruling party to commit fraud.
Among the changes are new provisions that restrict
the access of poll watchers and give officials greater
discretion in deciding whether voters without identifi-
cation can cast ballots.
More conventional methods, such as pork-barrel
projects and patronage, are also in evidence in the
state. In addition, the Embassy reports that the PRI
has selected awell-qualified candidate, Fernando
Baeza, who is widely respected in Chihuahua as an
effective administrator and an accomplished politi-
cian. He will run against Francisco Barrio, the popu-
lar PAN mayor of Ciudad Juarez.
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Despite the protests and dropoff in voter turnout last
year, Mexican officials, in our judgment, view the
election-rigging strategy as successful-the opposition
was left demoralized. The US Embassy in Mexico
notes, however, that these tactics appear incompatible
with the post-1977 electoral reform view that a
limited opposition is necessary to provide a channel
for political dissent. At least for now, the government
has decided that an opening of the political system
during a period of economic deterioration is too
dangerous.
Although this strategy is likely to produce an increase
in protests, particularly in PAN strongholds, out-
breaks of violence will probably be scattered and
quickly put down; nevertheless, the prospects for
alienation and a greater longer term threat may
increase. If the government sends the military into
troublesome states before the elections, as we expect,
the potential for violence will be significantly reduced.
We believe, however, that the alienation accompany-
ing this scenario could lead to greater unrest and
instability in the longer term.
Most Likely Scenario: Scattered election protests
occur, but violence is kept to a minimum; threat to
system, to extent it exists, is in longer term.
? PRI wins all governorships and retakes many
municipalities.
? Most elections legitimately won by PRI candidates.
? PAN retains control of a few major cities in its
stronghold, such as Chihuahua City and Ciudad
Juarez in Chihuahua.
? Some charges of fraud, but it is neither widespread
nor blatant.
? Military units are brought into opposition strong-
holds before the announcement of election results.
? Voter turnout of 50 percent or more, indicating
normal levels of absenteeism.
widespread lack of legitimacy for the system.
Alternate Scenario: Major outbreaks oJ'election pro-
tests involving widespread violence, particularly in
opposition strongholds; creates an immediate threat
to the system.
? PRI wins all governorships and significant offices in
major municipalities.
? PAN loses all major cities, including previously held
offices in strongholds.
? Major charges of election fraud, including blatant
tactics such as stealing or stuffing ballot boxes.
? International press charges fraud and descends on 25X1
Mexico.
? Voter turnout of less than 30 percent, showing
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