NATIONAL INTELLIGENCE DAILY WEDNESDAY 13 JANUARY 1982

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 0005065457
• Release Decision: IPPUB U
• Document Page Count: 17
• Document Creation Date: June 23, 2015
• Document Release Date: September 9, 2010
• Case Number: F-2007-00446
• Publication Date: January 13, 1982

 Poland: i
West Germany - France: Summit Meeting . . . . . . . . . . . 1
3 Argentina-Brazil: Nuclear Capabilities . . . . . . . . . . 2
Sudan-Kuwait: Oil Deal 3
USSR-Argentina: Grain Purchase . . . . . . . . . . . . . . 4
Special Analysis
I Greece: Papandreou's Foreign Policy . . . . . . . . . . . . 5
13 January 1982
 POLAND:
crease pro uc zon o coa and other mtneras is due to the six-day
workweek. The statement by a government spokesman that the regime
would Like to end martial Law soon should not be taken too seriously.
The NATO communi ork for future action by the
Allies.
Planning officials told a US Embassy officer in
Warsaw yesterday that production of coal and other min-
erals has increased since the imposition of martial law
because of greater work discipline but that output has
.91-One in sectors dependent upon Western materials.
One official said that the six-day workweek had been
introduced largely in the mining and transportation
sectors; other militarized sectors work longer hours
only if materials are available. He added that the
compulsory six-day workweek would end with the lifting
TI IF !lrlArrrt
13 January-1-98-2-
 of martial law and the government would then have to
increase market supplies to encourage miners and other
key workers to time voluntarily in return for
extra pay.
Comment: Increased production in mining is due to
the sixix-d yy orkweek rather than "high discipline." Con-
sequently, the government will be very reluctant to give
up the extra output and is therefore likely to prolong
this element of martial law. The authorities may also
extend the workweek in other , militarized sectors if it
can assure regular supplies.
End to Martial Law?
A government spokesman told foreign journalists yes-
terday that the authorities "would like to end" martial
3 law by 1 February but hastily added that there is no
timetable and that such a move "depends on the situation."
Another spokesman said that "a place would be found for
Walesa" in future agreements on trade unions. The same
official said, however, that "We demand loyalty to the
state," and added that union activity had been banned
from government institutions and ministries.
Comment: The moderate comments seem intended to
impress a Western audience and do not presage any break-
through. Martial law authorities do not yet feel secure
enough to end restrictions cr to relpngp significant
(' numbers of those detained.
The authorities would like to have Walesa's coop-
eration, but he still seems unprepared to play their
game. The harsher references to loyalty are probably
more representative of re g attitudes among
regime officials.
NATO Meeting
The NATO Foreign Ministers discussion did not pro-
duce a consensus on sanctions and did not significantly
~ reduce national control over how and when to implement
13 January 1982
 specific measures. While the Greeks were alone in ob-
jecting to communique language on sanctions, the Turks,
French, Canadians, and Nordic Allies all gave reasons
why they cannot impose new sanctions now. West German
Foreign Minister Genscher expressed the view that the
Polish situation would not soon improve and that NATO
now needed to consider future action.
Comment: Monday's communique was a high-water mark
in NATO consultation, presenting a unified public front
and laying the groundwork for future action if West Euro-
pean populations and governments come to believe that
/ repression in Poland is worsening or will continue in-
definitely. The communique could become the focus of
intra-Alliance dispute, however, if the Warsaw regime
engineers an easing of martial law that is considered
cosmetic by some Allies but encouraging or even signifi-
cant by others.
13 January 1982
 WEST GERMANY - FRANCE: Summit Meeting
Chancellor Schmidt and President Mitterrand probably hope to
agree on a unified response to events in Poland during their
hastily scheduled meeting in Paris today
Top officials in both countries have expressed
alarm about press allegations of differences between
Paris and Bonn over Poland. The French, moreover, are
concerned that divergent US and European reactions to
Poland might lead to a split in the Alliance.
West German officials now believe that the Polish
situation is deteriorating and that a unified Western
position threatening further economic action might in-
duce Moscow and Warsaw to tolerate residual reforms
in Poland.
Comment: West German officials probably believe
that a West European threat to reconsider participation
in the pipeline project could provide leverage over the
Soviets. Although West Germany's pipeline contracts
have been signed, Bonn could more credibly threaten to
reconsider its support for the project--largely in the
hands of private companies--if France and Italy show less
enthusiasm for it.
Schmidt will refer to his meeting with Mitterrand
when he defends his government's policy before the
Bundestag tomorrow against likely opposition charges
that West Germany is isolated from its allies over
Poland.
13 January 1
 ARGENTINA-BRAZIL: Nuclear Capabilities
The head of Argentina's nuclear program in an interview pub-
lished in Brazil has asserted that both Argentina and Brazil will
be able to build nuclear weapons within three years.
Comment: Argentina--but not Brazil--evidently
could develop a nuclear weapon within three years.
Both could probably complete weapon design and high-
explosive testing, however, within three years. The
availability of fissile material would determine the
pace of production.
Argentina is likely to have its uns
Brazil does not have a suitable reactor or a
essing plant of any significant size
The Argentine official previously has claimed that
Buenos Aires already can develop nuclear weapons but does
not intend to do so, and his latest statement appears to
have been made for propaganda purposes. The reference
to Brazil may be. calculated to allay concern there re-
garding Argentina's fast paced nuclear development and
its ultimate intentions.
13 January 1982
 Sudan has obtained a six-month credit from Kuwait
for refined petroleum products. The unusual deal,
arranged through the private sector, pledges revenue
from future cotton exports as a guarantee and eliminates
the requirement that the private sector deposit 50 per-
cent of cotton export receipts in Sudan's Central Bank.
Sudan's only refinery has been closed for two weeks,
and no supplies of crude have been arranged.
Comment: Khartoum's decision to mortgage the
country's most important export crop is a desperate
one, and Sudan will continue to have problems arranging
oil imports. Although the deal with Kuwait will ease
immediate fuel shortages, supplies will remain uncertain
until the refinery reopens.
3 F_
13 January 1982
 The USSR has bought some 2.5 million tons of corn
and sorghum and 1 million tons of wheat from Argentina
since early December for delivery by 30 September 1982.
It has paid a $5- to $10-per-ton premium over US prices
for most of the grain. The Soviets started buying two
months earlier than last year under the Soviet-Argentine
Long Term Grain Agreement.
I / -,,,
now stand at 31.5 million tons.
Comment: Moscow may have decided to buy the grain
early to avoid paying larger premiums that would be
demanded if there is a US grain embargo. The USSR prob-
ably will import about 45 million tons of grain; its
purchases and orders for the year ending 30 September
4
13 January 1982
 GREECE: Papandreou's Foreign Policy
by Kurt Hochstein, CIA
Prime Minister Papandreou is seeking more advantageous terms
for Greece in NATO and the EC and a strengthening of economic and
political ties with the Arab states. These objectives reflect his
concern over Turkey's growing strategic importance to the West and
its claims in the Aegean and his recognition that Greece's poor
economic outlook may force him to seek Arab financial assistance.
Papandreou's pursuit of these goals will lead to further strains
in relations with Turkey and the US, but most Greeks will support
his efforts so long as he does not sever the defense relationship
with NATO and the US.
Papandreou's policies thus far have been ambiguous,
but there is little doubt that his overriding objective
is security against Turkey. His contentious diplomacy
at high-level NATO meetings last month was primarily a
tactic aimed at reviving Alliance interest in Aegean
issues, particularly the Greek concern to maintain a
military balance with Turkey. Although Papandreou will
continue trying to exploit NATO, he probably thinks the
coming defense negotiations with the US offer a better
opportunity to obtain more military aid and, if possible,
a treaty commitment securing Greece's Aegean borders
with Turkey.
Papandreou might retract his demand for a specific
security guarantee if the US provides weapons on finan-
cial terms no less favorable than those offered Turkey
and in dollar amounts that approximate a 7 to 10 ratio
of US military aid to Greece and Turkey. The highest
priority is an advanced fighter aircraft.
The Greek leader will be more willing than his
predecessors to apply pressure by linking the presence
of nuclear weapons and US facilities in Greece to satis-
faction on aid and weapons transfers. He might buttress
5
13 January 1982
 his position by abrogating the treaty of 1953--the basis
for the US presence--and by reiterating his threat to
set a timetable for the withdrawal nf forces, probably
over 15 years or so.
Athens, anticipating a tough US bargaining stance,
is interested in further diversifying its source of
weapons and has increased arms negotiations with France.
The Economic Impetus
Papandreou does not seem inclined to cut Greece's
high rate of defense spending. Although he already has
shown signs of curtailing ambitious domestic spending
plans, he still will have difficulty controlling growing
trade and public sector deficits and reducing a persist-
ent 25 percent annual rate of inflation. Prospects are
dim, moreover, that Papandreou will receive major con-
The need to broaden sources of economic assistance
has led Papandreou mainly to the Arabs. The government
has signed trade protocols with Arab states, particularly
Iraq, that could bring in investment and contracts for
industry. The Greek Socialists hope that the visit of
PLO leader Arafat and Papandreou's pro-Arab stance in EC
and NATO forums will encourage the Arabs to follow through
on the contracts and provide financial assistance.
Papandreou does not seem prepared to pay the polit-
ical costs required to attract large amounts of Arab
capital, including a break in relations with Israel.
Such a step would put him at odds with his EC partners
and probably lead to a loss of Greek influence in the
Community.
Strategy and Risks
Papandreou also is taking some risks in NATO. His
implicit threat to hold up parliamentary ratification
6
13 January 1982
 Yugoslavia
Albania.
Bulgaria
G reece
Ionian Sea
ATHFdIFS
Aegean
Sea
Cap muncations base
Ili kOn
it use
A base
Crete
Sea of Marmara
c:' a
Turkey
 improve Greek military capabilities.
of Spain's application for membership until the Alliance
provides a security guarantee against Turkey has irri-
tated many members and ultimately could lead them to
hold back on infrastructure projects Papandreou wants to
and mineral rights.
In the Aegean area, Papandreou's refusal to negoti-
ate disputes with Turkey is edging relations back toward
the stormy period of the mid-1970s. Even though miscal-
culations by either side could produce minor incidents,
Papandreou would not find a showdown with Turkey in the
Aegean in Greece's interests. The military regime in
Ankara, however, could use military exercises or a re-
newal of maritime seismic explorations to press its
demands for a more equitable sharing of Aegean sea, air,
Kvorianou to take a hard line on Greek Cypriot concessions.
Greece will concentrate on anti-Turkish propaganda
in international forums, focusing on the Aegean and
Cyprus issues. Papandreou's dissatisfaction with UN-
proposed compromises will make it easier for President
some US facilities.
Papandreou probably hopes that his strength in
Parliament, as well as his cooperation in allowing US
facilities to continue functioning in Greece, will give
him ample maneuvering room in what could be lengthy ne-
gotiations with the US. If a stalemate develops in the
base talks, Papandreou might restrict the activities of
including military intervention.
The Prime Minister almost certainly would not close
the four principal US military bases, with the possible
exception of the communication facility at Nea Makri.
Closure of the other bases would abrogate the US commit-
ment to Greek security and thus probably would provoke
a strong domestic reaction against Papandreou, possibly
Papandreou has thus far not made any direct attempts
to improve relations with Moscow. His tentative reaction
13 January--19&2
 to the crisis in Poland is more than a sop to the strong
left wing of his party; it probably also is intended to
build credit with the Soviets for increased economic
cooperation or for diplomatic support in the disputes
with Turkey. Moscow has generally given priority to
developing relations with Turkey, which is the largest
recipient of Soviet economic aid outside the Soviet bloc.
Domestic Perspectives
Papandreou's foreign policy actions to date have
enhanced his domestic political standing. The opposition
New Democracy party has offered only mild criticism of
the government's foreign policy. The pro-Moscow Commu-
nists, the third largest party in Parliament, have been
the most vocal critics, chastising Papandreou for not
breaking with the EC and NATO.
Most Greeks probably recognize that Papandreou's
rhetorical flourishes do not represent fundamental shifts
in foreign policy. Meanwhile, President Karamanlis and
the military leadership continue to take a "wait and
see" attitude but Karamanlis's New Year's message to
the nation contained a subtle warning to the Socialists
that they should not move too abruptly, particularly on
the foreign policy front.
8
13 January 1982
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