NATIONAL INTELLIGENCE DAILY THURSDAY 19 NOVEMBER 1987

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP88T01422R000100150003-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 24
• Document Creation Date: December 23, 2016
• Document Release Date: October 25, 2013
• Sequence Number: 3
• Publication Date: November 19, 1987
• Content Type: REPORT

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Director of ----1-op-beerer
Central
Intelligence
National Intelligence Daily
Thursday
19 November 1987
?TaireeCret"--
CPAS NID 87-269JX
19 November 1987
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Contents
Iran-Iraq: Damage to Bushehr Nuclear Power Station
1
International: Downward Pressure on Oil Prices
2
Angola: Widespread Fighting Continues
3
El Salvador: Leftist Exiles Plan Strategy
4
Notes
USSR: Soviet Authorities Quash Latvian Demonstration
5
USSR: Yel'tsin's New Appointment
5
USSR-India: Premier Ryzhkov Visits India
6
China-India: Border Talks End
6
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Italy: Political Crisis Winding Down
9
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Argentina: Stalling on Human Rights
10
Kenya: More US Missionaries To Be Expelled
10
In Brief
11
Special Analyses
Israel: Shamir's Washington Visit
12
Nicaragua: Coping With Oil Shortages
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IRAN-IRAQ: Damage to Bushehr Nuclear Power Station
The Iraqi attacks Tuesday on Iran's partially completed Bushehr
nuclear power station caused only moderate, reparable damage,
but they will hinder Tehran's ability to obtain the foreign
assistance needed to complete the facility.
According to West European media reports, the staff of a West
German engineering firm had been at Bushehr to test the status of
on-site equipment. One of these engineers was among those killed in
the attack, and the others are leaving Iran.
Meanwhile, the head of Iran's Atomic Energy Agency has warned
publicly of the potential for a radiation release comparable to that of
the Chernobyl' disaster and has called for the International Atomic
Energy Agency to send teams to Bushehr to check for radiation and
to inspect equipment. According to a report from the US Mission in
Vienna, the IAEA has yet to decide how to respond.
Comment: There probably will be no radiation released as a result of
the attacks. Uranium for the reactor fuel is still in West Germany,
The Iranians do
have some safeguarded, highly radioactive material in their US-built
Tehran research reactor but probably have no way to move it to
Bandar-e Bushehr. Even if they had done so, the type of damage and
the possible quantity of material involved would not result in any
significant emission of radiation.
The generator and control buildings probably could be repaired, but
the attacks and casualties will make it even more difficult for Iran to
obtain needed foreign assistance. Foreign firms that had been
negotiating for the work had already refused to send large numbers of
employees to the site for extended periods.
Iraq may lose standing in international nuclear forums, where it has
stridently opposed attacks on civilian nuclear facilities following
Israel's attack on its Tuwaitha research reactors in 1981.
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INTERNATIONAL: Downward Pressure on Oil Prices
Downward pressure on oil prices is building because OPEC
members?led by Iran?are offering price discounts in an
attempt to sustain their share of the market.
Substantial overproduction by OPEC members in recent months and
an unwillingness to reduce exports sharply this month has driven the
average price of crude oil down by more than 50 cents in recent
weeks to about $17.75 per barrel. Spot prices for several OPEC
crudes have fallen to about $1.50 below official prices, which has
induced members to offer discounts to maintain exports.
Many members?including all of the Persian Gulf producers except
Saudi Arabia?are already providing sli ht discounts to sustain
exports, Although Saudi output so far
this month reportedly remains near its quota, exports are more than
500,000 barrels per day (b/d) below last month's levels.
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The US and French embargoes on Iranian oil are adding to the fall in
prices as Tehran is having difficulty replacing customers. Iran is trying
to sell more oil to Eastern Europe, but is 25X1
having only modest success. Iran's net oil exports reportedly are as
low as 1.3 million b/d?down about 1 million b/d from the yearly high
in August. Iran has recently sold 25X1
oil at nearly $2 per barrel below official prices. 25X1
Comment: The decision by Iran?a strong advocate of high oil
prices?is a major blow to OPEC. Pressure is now mounting on Saudi
Arabia to allow its exports to fall and try to keep the OPEC agreement
from unraveling or to begin offering discounts of its own. Riyadh
probably will not allow its production to fall for very long in the face of
widespread discounting by other members. If it begins to offer
market-related prices to sustain its share of the market, prices would
erode sharply. Under these conditions, Iran probably would attempt
to intimidate Riyadh to alter its policies. Tehran's options include
increased attacks on ships transporting Saudi oil, terrorism, or
attacks on Gulf oil facilities.
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ANGOLA: Widespread Fighting Continues
Angolan brigades are pulling back under continuing attacks by
UNITA and South African forces, while the insurgents continue
guerrilla operations throughout the northern and central
provinces.
UNITA forces continue to conduct operations throughout the country.
UNITA claims to have shot down a Soviet-piloted transport aircraft?
possibly an IL-76?approachino Huambo last week.
Comment: UNITA and Pretoria are attempting to inflict maximum
casualties and drive the Angolans back to Cuito Cuanavale. If their
attacks prove successful, the combined forces may seek to overrun
government positions in the town itself. The intensity of the fighting
probably will diminish by the end of this month, however, as
increasing rainfall impedes large-scale tactical operations. Moreover,
many South African conscripts will be due for release next month
after completing tours of duty.
UNITA will probably increase guerrilla attacks throughout the country
to maintain pressure on Luanda. Widespread guerrilla activity,
particularly near the capital, might inspire government leaders?who
have escaped the effects of the fighting so far?to lobby for a military
strategy that reduces government operations in the southeast in favor
of defending the economically vital northern and central regions.
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EL SALVADOR: Leftist Exiles Plan Strategy
The decision of two key insurgent political exiles to return to
El Salvador probably reflects their dissatisfaction with the
guerrillas' emphasis on terrorism and political violence and their
desire to take advantage of public disillusionment with the ruling
Christian Democrats.
The recent political killings attributed to the right have not caused the
insurgents' political leaders to change their minds about returning to
El Salvador later this month, according to the US Embassy. They have
announced plans, including a political alliance with a small leftist
party, to contest next year's legislative and municipal elections.
Embassy reporting suggests that growing factionalism within
President Duarte's party and among key supporters?such as
labor?could enable the alliance to win as many as five seats.
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Although the two leaders claim they do not plan an open break with
guerrilla hardliners, they will allow the relationship?which has
deteriorated as the guerrillas increasingly turn to indiscriminate
terrorism?to atrophy gradually, according to the Embassy. Front
leaders have placated the guerrillas by maintaining that their return is
intended to rejuvenate faltering political organizational efforts,
Comment: The insurgent political leaders reportedly are frustrated
with their diminishing role and probably hope that rebuilding their
long-neglected political bases will enable them to become an
attractive alternative to both the armed insuroents and Duarte's
lackluster Christian Democrats.
The exiles' return could provide the Salvadoran political system
additional legitimacy and diminish the international appeal of the
rebels?although it is unlikely to affect the pace of the war. In
addition, a credible showing by the leftist party could stimulate the
Christian Democrats to address much-needed internal reforms.
Military discontent with civilian rule nonetheless will grow if front
politicians do not renounce their alliance with the guerrillas or use
their political positions to criticize the military's counterinsurgency
operations or past human rights abuses.
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Finland
The United States Government Usenet recog
the incorporation of Estonia. Latin., and Lithuania
into the Soviet Union. Other boundery representation
is not necessarily authoritative.
Sweden
'CV
Liepija
Baltic
Sea
Polan
ietK nio
Czechoslovakia
5'e'e'.94'0, Donets
Hungary
Yugoslavia
Black
Sea 0 200 Kilometers
I
0 200 Miles
711838 (800316) 11-87
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USSR: Soviet Authorities Quash Latvian Demonstration
Latvian authorities yesterday quashed
the nationalist demonstration in Riga. They mobilized some 10,000
uniformed, plainclothes, and "voluntary" police?successfully sealing
off the Freedom Monument, a popular gathering place near the city
center that was to have been the focal point of the demonstration.
The authorities prevented a march by more than 2,000 Latvian
nationalists who had gathered for the event. In addition, the militia
jailed at least three rally organizers and placed several others under
house arrest. One organizer was expelled from the USSR to Austria
the day before the scheduled march.
Comment: The Soviets' willingness to use force to break up the
Latvian demonstration reflects a leadership shift to a more
conservative position on dissent. Soviet leaders?increasingly
apprehensive that growing nationalist unrest in the Baltic and other
non-Russian republics could erode civil order throughout the USSR?
are determined to discourage further rallies.
USSR: Yel'tsin's New Appointment
TASS announced yesterday that former Moscow party boss Boris
Yel'tsin has been appointed first deputy chairman of the construction
sector's coordinating body, the State Construction Committee, and
that he will hold ministerial-level rank. Yel'tsin has an extensive
background in construction, having served in related posts at
Sverdlovsk in the 1960s and 1970s; he headed the Central
Committee's construction department for a brief period in 1985.
Comment: The appointment clearly is a demotion for Yel'tsin, but he
is not in complete political disgrace. By giving Yel'tsin a lesser but
important position, the leadership may be seeking to assuage fears
that his removal as Moscow party chief is a retreat from the reform
policies he championed. It appears that Premier Ryzhkov?an
associate of Yel'tsin from Sverdlovsk?may have taken responsibility
for finding him a suitable job. Yel'tsin will almost certainly lose his
Politburo candidate membership but could retain his membership in
the party's Central Committee. The announcement yesterday came
amid rumors of Yel'tsin's failing health and probably is intended to
end speculation on that subject.
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USSR-INDIA: Premier Ryzhkov Visits India
Soviet Premier Ryzhkov will arrive in New Delhi tomorrow for a five-
day visit. Ryzhkov, who will open a Soviet cultural festival, is the
highest level visitor from the USSR to India since General Secretary
Gorbachev's trip last November. The Soviet press has given
prominent coverage to the visit, noting Prime Minister Gandhi's
personal invitation to Ryzhkov and the "tradition of high-level
exchanges of views" between the USSR and India.
Comment: The Soviets probably planned the trip to reciprocate
Gandhi's visit to Moscow in July and to counter the success of his trip
to the US last month. Moscow may also be trying to measure the state
of relations between New Delhi and Beijing following the just
concluded round of Sino-Indian border talks. Neither side appears to
be planning major substantive agreements, but Ryzhkov will probably
try to enlist Indian diplomatic support for possible new proposals by
the USSR on shortening the timetable for Soviet troop withdrawal
from Afghanistan. India has recently floated proposals on Afghanistan
at the South Asian regional summit and in the UN and may again be
willing to lend Moscow support if it believes doing so will lead to a
settlement. Ryzhkov may also continue Soviet efforts to reverse the
recent slump in bilateral trade.
CHINA-INDIA: Border Talks End
Talks in New Delhi between China and India concluded on Tuesday
with little progress toward resolving their border dispute, according to
the US Embassy. The two sides announced that the ninth round of
border talks will be held next year in Beijing, at a date yet to be
determined.
Comment: Neither side is willing to make the territorial concessions
necessary to resolve the border dispute and, instead, used the talks
to improve the atmosphere for a long-term dialogue.
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ITALY: Political Crisis Winding Down
The governmental crisis caused by the Liberals' decision to withdraw
from the ruling center-left coalition last Friday appears headed for
resolution, but the Goria government's grip on power remains
tenuous. President Cossiga today will resubmit the same government
to Parliament for a vote of confidence, following the decision by the
Liberals late yesterday to rejoin the ruling coalition. The Liberals'
change of heart came after Goria gained the approval of the other
coalition partners for a package of minor tax and spending cuts that
satisfied the Liberals' minimum demands for a reduction of the public
sector.
Comment: By resubmitting the incumbent Goria-led government
rather than insisting on a formal reconstitution of the five-party
coalition, Cossiga should head off potentially obstructive wrangling
over the apportionment of cabinet portfolios. Although the
government will easily win the confidence vote, it will remain weak
because it lacks firm support from Socialist leader Craxi and Christian
Democratic leader DeMita. The coalition will be periodically tested
over the next few months as it confronts a range of controversial
issues, including the budget, energy, judicial immunity and reform of
Italy's political institutions.
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ARGENTINA: Stalling on Human Rights
President Alfonsin is using the courts to postpone impending trials of
officers accused of human rights abuses and may be maneuvering to
grant them amnesty. Despite a "due obedience" law passed last June
to exonerate officers on grounds that they were following orders,
many cases remain on the court dockets. The government is trying to
delay the trials by urging the Argentine Supreme Court to remove the
case files temporarily from the lower courts for review.
Alfonsin may be seeking an amnesty for
virtually all officers indicted for or convicted of human rights abuses
or crimes related to the Falklands War in 1982.
Comment: Ending the human rights trials outright would improve
civil-military relations and lessen the prospect of additional Army
revolts similar to the garrison uprising last April. Although Alfonsin
has publicly rejected an amnesty, he may now believe it is the only
way to reconcile the military to democratic institutions. Because such
a move would be highly controversial?and opposed even by some in
the President's own party?Alfonsin probably would postpone an
amnesty until just before his term ends in 1989.
KENYA: More US Missionaries To Be Expelled
Kenya, which expelled seven US clergymen last Friday on charges of
plotting to unseat President Moi, has given eight more US
missionaries until next Wednesday to leave the country. The
US Embassy says that Nairobi has provided no explanation for the
latest expulsions, and a Foreign Ministry official claims that his staff
lacks the leverage to prevent immigration authorities from carrying
out the deportations. The Embassy doubts the decision can be
reversed.
Comment: The new expulsions suggest policy drift in Nairobi rather
than any intent to disrupt Kenya's close relations with the US; earlier
this month, a four-week joint US-Kenya military exercise was
completed without incident. Senior Kenyan officials have been
preoccupied with the visit of West German Chancellor Kohl and with
recent violent student protests that prompted the government to
close Nairobi University on Monday. The expulsions are likely to
increase international criticism of Kenya's human rights record,
recently a sore point in bilateral relations with the US.
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In Brief
Americas
Middle East
Europe
East Asia
? Maoist Sendero Luminoso apparently responsible for bombing at
US Embassy, attacks on three additional targets in Lima yesterday
... coincide with convention of major Peruvian leftist groups and
may be response to successes by rival pro-Cuban group
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? Monthlong labor strife continues in Martinique's capital after
business shutdown Monday ... slowdown by portworkers
threatening vital agricultural, tourist sectors ... potential for
violence growing as economic situation worsens.
? Egypt indicted 33 members of Islamic fundamentalist group for
attempting to assassinate three prominent Egyptians last spring
... will seek death penalty for 15 ... case being tried as criminal
matter, not likely to raise domestic tensions.
? Polisario launched two attacks against berm in Western Sahara
yesterday, .. preliminary
information indicates Moroccans fared well, destroying or
capturing 13 armored vehicles.
? Bulgarian Foreign Minister in Yugoslavia, first such visit in seven
years... precursor to Yugoslav-sponsored Balkan foreign
ministers' conference early next year... Belgrade playing down
concerns over ethnic issues to promote Balkan cooperation.
? Polish President Jaruzelski begins visit to Greece today ...
seeking endorsement of his European disarmament plan ...
formal agreement unlikely, but Greek Prime Minister Papandreou
may give it rhetorical support.
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? China has agreed to token withdrawal of two British patrol boats
from Hong Kong by 1989 ... still opposes early withdrawal of
9,000 troops ... wants to maintain rationale for bringing in sizable
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Special Analysis
ISRAEL: Shamir's Washington Visit
Israeli Prime Minister Shamir?arriving in Washington this week
at the midpoint of his 25-month term and in firm control of
Israel's National Unity government?is likely to reiterate his
objections to an international Middle East peace conference and
to seek assurances that US aid will not be cut. Shamir will
probably explore the chances for increased cooperation on
future military projects, including Israel's Arrow ant itactical
ballistic missile, and ask for greater US support for Israeli
access to NATO military service and supply contracts.
Since regaining the prime-ministry in October 1986, Shamir has
bolstered his leadership of the Likud bloc through deft maneuvering
in the party's ranks. He almost certainly will seek to lead Likud in the
parliamentary election scheduled for November 1988 and will
probably win the party's nomination handily.
Shamir also has been encouraged by Likud's growing popularity in
public opinion polls in recent months. Likud has narrowed the Labor
Party's lead from 10 to just a few Knesset seats. A dead heat in the
election next year would make another Labor-Likud government the
most likely governing coalition.
The Prime Minister has outmaneuvered Foreign Minister Shamir, the
Labor Party's chairman, on two key issues this year?blocking his bid
for Cabinet approval of the international peace conference proposal
and securing a majority in the Knesset against advancing the election
date. Shamir is convinced that an international peace conference
would lead to unbearable pressures on Israel to make major territorial
concessions on the West Bank, Gaza Strip, and Golan Heights.
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During his visit, Shamir is likely to reiterate his strong opposition to
Peres's conference proposal. Emphasizing this position would
improve his credentials with Likud's hardline constituency and its
hawkish religious party allies. The Prime Minister will try to appear
open to alternative ideas to engage Jordan and Syria in direct
negotiations to demonstrate an image of flexibility on the peace
process.
Shamir has characterized the outcome of last week's Arab summit
meeting as partially positive, describing the restoration of Arab ties to
Egypt as proof that an Arab country can make peace with Israel and
continued
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remain part of the Arab world. He was highly critical, however, of the
summit's endorsement of an international conference with PLO
participation.
The Prime Minister is likely to seek assurances that US aid will not be
cut. He reminded US officials visiting Tel Aviv earlier this month that
the US had committed itself to providing $1.8 billion in annual military
aid for the next two years and argued that the pledge should remain
binding. Shamir will likewise seek continuation of economic
assistance at the current level of $1.2 billion per year.
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Shamir will probably seek additional ways to alleviate the impact of
canceling the Lavi fighter plane project, such as increased
cooperation and joint ventures with the US, including funding for
Israel's Arrow antitactical ballistic missile. He also will probably seek
greater Israeli access to military service and equipment contracts in
NATO as well as favorable prices for Israel'! impending purchase of
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Nicaragua: Military's Increasing Oil Consumption
Thousands of barrels per day
El Civilian
El Military
20
15
10
0
5
0 1978 1982 1985 1987a
a Projection based on expected deliveries and estimated military requirements.
314915 11-87
Nicaragua: 1987 Petroleum Suppliers
Barrels per day
USSR
Cuba
East Germany
Bulgaria
Poland
Czechoslovakia
Hungary
Others a
Total"
8,033
2,008
1,807
803
602
602
201
1,000
15,056
a Estimate.
lb Does not include 300,000 barrel storage.
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Special Analysis
NICARAGUA: Coping With Oil Shortages
Nicaragua continues to face tight oil supplies, primarily because
of poor planning and increased military fuel requirements, but
regular Soviet deliveries have prevented paralyzing shortages.
The Sandinistas so far have failed to obtain significant supplies
from non-Soviet sources and are unable to decrease internal
demand without reducing military consumption. Consequently,
Managua probably will need supplemental shipments from the
Soviet Bloc or Cuba to get through the remainder of the year.
The regime has tried without much success to reduce civilian
consumption by restricting supplies and dampening internal demand.
Since June, the government has ordered the country's only refinery to
reduce most nonmilitary fuel allocations by 15 percent and, at the
same time, has increased the price of gasoline almost 30 times above
the May price, including a 200-percent increase announced on
8 November. Press and Embassy reporting indicates, however, that
these price increases have failed to reduce demand, because
Nicaragua's 2,000-percent inflation rate has kept real gasoline prices
from rising above roughly 30 cents per gallon.
Causes of the Shortages
Higher-than-expected consumption, rather than reduced supply, is
largely responsible for Nicaragua's oil crunch. Increased military
activity has driven up the armed forces' oil usage an estimated
15-fold since the Sandinistas came to power, and the military now
consumes roughly one-half of Nicaragua's petroleum,
Problems with distribution, scheduling, and maintenance at the
refinery have aggravated the shortages. The US Embassy reports that
the country's fleet of tanker trucks is deteriorating and inadequate for
handling petroleum distribution, late
deliveries of Soviet crude and a lack of hard currency to purchase
spare parts have led to an increasing number of shutdowns this year
at the refinery.
Meanwhile, Soviet oil tankers have continued to arrive on an average
of once every two weeks, refuting Sandinista statements in late May
that Moscow might cut off oil deliveries. According to press reports
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Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9
Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9
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Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9
Top Secret
and the regime's economic plan for this year, moreover, existing oil
contracts with Cuba and Soviet Bloc creditors provide for a
4-percent increase over the amount delivered last year.
Consumption patterns early in the year probably were based on
Managua's expectation of a larger increase in oil deliveries from the
Bloc this year. The regime apparently had set up a shipping schedule
with Moscow early this year that anticipated a 14-percent increase
over deliveries last year. Failure to obtain firm commitments for these
supplies?particularly from Czechoslovakia?has forced the
Sandinistas to scramble for more oil.
Search for Oil
The Sandinistas have had little success in recent months in
persuading non-Soviet petroleum exporters to supply Nicaragua with
oil on credit. Despite numerous pleas made throughout Latin
America, Western Europe, and the Middle East, only Peru has agreed
to help with a small shipment of fuel oil.
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After failing to obtain oil elsewhere, Managua announced the signing 25X1
of three additional contracts with the Soviet Bloc and Cuba in late
summer. Moscow increased its allotment by one-third, providing an
additional 730,000 barrels. Cuba increased its donation by almost
300,000 barrels, and Czechoslovakia agreed to finance an additional
210,000 barrels, still only one-third the amount Managua expected
from Prague. 25X1
Outlook
Nicaragua probably will need at least an additional 300,000 barrels of
petroleum products to maintain current consumption levels until
shipments for next year begin in January. To avoid a crisis, Moscow
or Havana probably would agree to ship more oil next month?
possibly charging the delivery to Managua's allotment for 1988.
According to press reports, the USSR already has made
commitments to finance the delivery of more than 2 million barrels of
oil per year to Nicaragua until 1990.
Top Secret
15 19 November 1987
Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9
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Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9
op becrei
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Top Secret
Declassified in Part - Sanitized Copy Approved for Release 2014/01/13: CIA-RDP88T01422R000100150003-9