NATIONAL INTELLIGENCE DAILY FOR 10 MAY 1988

Created: 5/10/1988

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Poland: Strike Deadlock Continuing

USSR: Delaying Talks on Interim Afghan Government

Belgium: New Government Faces Severo Problems

Holes

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i*mam: Taipei Considering Direct Trade

Czechoslovakia: Inching Toward Social Liberalization In Brlel

Special Analyses

USSR: Impact of Leadership Turmoil on Summit Lebanon: Implications ot Sola Fighting In Beirut

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Soviet Reaction

In the only official Soviet comment on theoland so ter. Ministry ol Foreign Affairs spokesman Gerasimov said last Thursday that the USSR regretted it Dul claimed that the late ol Poland's reform program had no bearing on Soviet relorm efforts. Soviet media are focusing almost exclusively on statements Dy Polish authorities. They are also giving considerable play to Warsaw's claims that the strikes arehreat to "socialism" but do threaten both economic reform and the welfare o! Polish citizens.

Tho Soviots undoubtedly are disturbed by the implication ihat Polish workers are dissatisfied with reform-Induced belt tightening and that economic reforms In tho USSR may face similar difficulties In the next two years. Stressing the economic losses caused by strike* Is presumably Intended toessage to Soviet workers about similar wage Issues. By publiclyandsoff attitude, the Soviets also hope to preserve the Impressionloc In which members handle their own affairs.

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Daadlock Contir uing

Polish Government hope* dMalona among atrlklng workers mod Ha war ol mtvm will bring thm strikessa. out talk* ot tha Gdansk ahlpjarda remain deadlocked

The strikers appeare dividedegime proposal toommittee to adjudicate labor demands thai would Include representatives of the striking workers and defer their demand for. Immediate restoration of Solidarity's legal status, MHajHaBBattaMfr VMHa*Youngetefusedompromise and vowed to continue holding ouTThe rogima Increased the pressure on lhe strikers toompromise when Interior Minister Klszczak reportedlyhurch negotiator that the recently {sited Solidarity leaders will be released If lhe Gdansk strike Is settled peacefully.

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Elsewhere In Poland, workers at the Ursus Tractor Factory near Warsaw tried Ioinks ternVMfs^MNIfMBI

saaasssflaVThe four-man strike committee andoff their action last night after management apparentlysecurity guarantees

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1 The regime's hesitancy to use force at Gdansk, asid at Nowa Huta, Is encouraging labor defiance elsewhere. The regime will continue to try buying off workers with pay raises, but the episodic strikes are sure to Increase arguments within the regime to use its special powers to movestop labor unrest.ecision would, however, rurthef discredit the government's reconciliation program by once again showing that control rather than political compromise Is the regime's primary goal.se of force would also dramatically demonstrate that tho regime lacks legitimacy and that Its only clslm to rule rests on

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Ursus haaotbed of labor activism and was among theto go on strikehe fizzling of the Ursus strike, inof new strikes elsewhere, probably will deepen the senseamong strikers at Gdansk. Ursus's location InII readHy

anle of whet happens there (or both sii

Delaying Talk* on Interim Afghan Government

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Moscow is no! ob/ecfmp to nmgotlmtlontor* Afghan governmrnnt under UN mediator Cordovei but apparently wants to nam until It can assass lha limg-term prospects of lha

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The Sovlei Governmf-nt statementsaid tnat the UN 1 fforts might be

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hon buon-vfflinti the UN to implement an informal understanding among lhe parlies toteva accordsouldjssion ot Interim arrangr/manls aJttjlV [j

The-SovletS havaPresident

NaUbuliah and his regimeolitical and rrJiltary lorce ihattrong, continuing role Many Soviet officials have argued that reslsfanco disunity will Improve fho regime's position and Its chancesoalition with resistance moderates, once Soviet troops begin to withdraw. They have also os'd Moscow does not want to see an extremist Islamic regime in power, claimingoverftment would bo detrimental to Western as well as lo Soviet

lMsraV -:s ettempt todoiay negotiations may retiocl uhwining'tuas In Kabul lo offer genuine power sharing to the resistance. The Soviets mayjear that further pressure witt reduce the regime's cohesion ssWMp*

Moscow, however, probably wants time to assess the performances of Ils client and ot the resistance, once the withdrawal Is under way. Tho Soviets may also hope, by playing on International distaste at the prospect Of another Iran In the InlojImJo strengthen Kabul's hand by tho time negotiations ereMMg

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Government Face* Severe Probloma

inister Mertenat new center-lett Hue-party coalition will not lent long unlets II canhorny linguistic dispute end reconcile economic policy dtttervncvB

em

Martens has ended Belgium's longest postwar political crisis by agreeing toeftthat It works constitution anrj continue economic austerity policies

and most difficult lash will bo to enacl constitutional reform that would devolve more responsibility to the regions -probably the only long-term solution to Belgium's linguistic frictions. Although lhe new government has the two-thirds majority needed for such reform, (hereood chance that discontented Francophone periy members may conclude thai Francophone Interests have been compromised and may undercut their leaders by opposing ii. Furthermore, the coalition accord merely papers overluer linguistic dispule In one town that brought down the previous governmeni. and this contlicl will probably resurfaceg

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a new budget is agovernment this year nns

been operating on monthly continuingmay soon arise among the live parties. Martens Is committed to 'educing the high budgel defied, but the Socialists may dissgree on tax reduction jindspcial welfare policy desplie their agreement In prlnclple.^pb

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The Flemish Socialists and Flemish Nationalists have opposed Belgium's naval deploymenl In the Persian Gulf end nuclear force modernization, and they have advocated cuts In defense spending, but the appointment ol Leo Tlndemans as Foreign Minister and Guy Coeme as Defense Minister leaves these parties little influence. Similarly, the poor state of the Belgian economy probably precludes higher defense spending, but the Francophonesupport NATO and the deployment In theprobably block cuts that would hurt defense industries in Wellonia:

eveloping consensus between right and led on security issues will make the government unlikely to support nuclear lorce modernization actively and may lead il lo be more vocal In pressing for EasL-West lalks on short-range njciear forcesaMMByshsajMOl^

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TAIWAN-US9ft-VIETNAM:Considering Olnsct Trad*

Taiwan's Minlsler olalts Lt Ta-hai has Indicated

lhal Tiqw is tradethe USSR smTaiwan has gradually loe'aued

0 IJI trade restrictions wtth East European nations, culminating in March

ecision mat private iredersfrom Taiwan and East European

nations may open tradear* . .

(3) decision Is, ir.esponse to growing

pressure from local businessmen lor Increased trade with lhe USSR and China, tt Is also consistent with Taiwan's attempis to diversity He export markets Moscow may be too sensitive to Belting's reaction to approve direct trade, but It probably wilt contMee to encourage Indirect transactions.order to avoid Increased pressure from Beijing for directNl continue toine line between "private" and ^ohlciarj trade relations with other Communist

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CZECHOSLOVAKIA: Inching Toward 8oclal Liberalization

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The Czechoslovak regime Is lollowing through on

..restrictions on private travel to the Weat.iaaassaaaat^,.

The government is permltllng more single people and

whole farnjiies. rarely allowed to travel before, to apply tor Western visas. Further liberalization Is reportedly planned. Includingot thoso who have emigrated Illegally. Premier Strougal also pledged recently that the government would Import we end export less to make more consumer goods available.

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Prague probably hopes It can Hit public morale and gain better press treatment In the West by catering to popular wishes on iravel and consumer supplies. The regime probably also hopes these Inducements will persuade workers to accept measures to Improvetighter labor discipline and linking bonuses to production. The regimes refusal to allow political liberalization, however, is likely lo preclude much support for economic restructuring. These small steps, therefore, may Increase political tension^bj^icouraging people to push for more concesslone.

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Bnel

week ot ethnic riots to Karachi,overnment saysead, morenjured, worst sinceiolence likely to subside soon, buj government lacks resources to deal with deep-seated coi ' JBleV,

Afghan leader Najlbutlah to attend UN disarmament conference In New York next montheeking international recognition, as In stale visit to India lastnsurgents will see visit as further evidence of UN's pro-Soviet biasfyj

Press reports short, ordely lines yesterday alterarks reopeneded cash withdrawn* eBBBBSTjsBBSBBB* '

Commission may approve further relaxation <Q

of withdrawal restrictions as early as Thursday)

Special Analysis

ot Leadership Turmoil on Summit

months US-Soviet summit mitt take plmco during one ot tho moat politically volatile periods In recent Soviet history. There le no evidence Ihet dltlerencet In the leadership over poller toward the US are prominent In the current turmoil, but the Soviet political ellmete will undoubtedly afreet the meeting. Ulkhall Gorbachevs petition In the leederthlp appears alronger now than et the "

i Gorbachev

nonetheleta It likely to ttlck to negotiating potltlonz worked out in the leederthlp, ea he did In Washington, and avoid,moves that might complicate hla domestic political eltuetlon. fHHssV' ^

recent tensions In the leadership

on these

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have centered on domestic Issues, most notably Ihe limits of glasnostin ihe restructuring of tha political system. The All-Union Party Conlerence late next month Is to locus on

Issues, and Its approach Is Intensifying the current lurm

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Gorbachev and his allies apparently have the upper hand for the momenttruggle wllh party conservatives led by "Second Secretary" Ligachev. Allhough the party conservatives areeleariy on the. defensive, they are still powerful and can complicate Gorbachev's pursuit ol many policy goals. Including those thai affect relations wiih the US. in general, the leaders most closely identified wtth conservative domestic policies ere also those most skeptical ot Gorbachev* foreign policy Inlllallves. The General Secretary may have bean preempting attacks from them when he harshly atlscked President Reagan's statements during his mealing with Secretary Shuttz last

Benefits end Risks

Gorbachev's main domestic political objective al the summitto build supportls leadership of the party. Wllh iheof the Reykjavik summit, where Gorbachevsslyle raised concerns in Moscow, his meetingsReagan have generally served this function, showingas an equal wllh lhe President and enhancingslaturo of the USSR. Gorbachev's performance In(3)

u US^veneppearedegan for him some olund lost

' ' M" probabfy judged even before lhe cumin: lendirs-'i? struggle broke outummitjust before the party conference would benefit him domeslicallyaas|Bs*V

continued

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Gorbachev seeks pubic supportiOJprogramsegree unprecedentedeader. Mewant to convince the Soviet populace that tne Moscow summituccess and that ne paid no moreeasonable price. Even under normal political conditions, he would be careful not tohishance to accuse him Of caving in to US pressure or jeopardizing Soviet security. This concern may be heightened by Ihe facjthai some Soviets questioned the fairness oi the iNf- agreement. sVessss*

The highly charged poliiical atmosphere In Moscow may make him even less Inclined toward controversial moves on arms control Ihat would alienate keye may be more conciliatory on human rights Issues, because humnn rlgriisjmprovemenis are consistent with hie domeshc reform aganda NHP'

Outlook

The odds are somewhat better than even that the leadershipnot determine Gorbachev's basic approach to thetha Soviet leader appears lo be in ihe b'gges'his political Hie. and evenis are highly(3)

There appears toha leadershrp that the positive trends in US-Sovet relations should be maintained wherever possible and that reducing East-West tensions serves Soviet Interests. Gorbachev will want to snow himselfough-minded protector ol Soviet interests, but he win also want this touccessful summit that win keep bilaiorel relations on track into the neat US administration. Me may leect strongly In public to any appearance of US pressure, while seeming conciliatory in private.gj

Gorbachev will be analous to play up his statusorld leader whose presence at lhe holm onhancos tho prestige and influence of the USSR Any such public relations benefits, however, will be temporary and unlikely to sway party conservatives toward supporting his domestic reform apsrirja^much of which directly threatens their political

Gorbachev may try to remove Ugachev from the Politburo or kick him upsta-rs lo replace Andrey Gromyko as heed of the Supreme Soviet before the summit. Ihe Supreme Soviet is to convene onay. and it reportedly will be precededentral Committee plenum, whlcnhe appropriate venue to make such personnel moves. Either move would strengthen Gorbachev poNilcaey end could grve ham more flex;bility in negotiating with Ine US. but the overall effect on bilateral relations In the Short term would be marginal at best. His primary motivation lor moving against Ligachev woulo^ifMoimprcjeme^ prospects lor mi domestic reform agenda(3)

SRI"

Special Analysis

of Shiaeirut

The prctwirMniMn Shia mllltla. Hizballah, appear* to hava gained lha upper hand ovar lit Srrian-backed Shia rival, Amal, during intense lighting over tne weekend in Woat Beirut NeHhor aide haa at doclttvo edge, ^orrerer. Sfrfan force* do not ye! appear ready lo intervene.)

The fighting seems lo have begun Friday when three Amal militiaman were killedizballah checkpolnl In West Beirut. The fighting spread quickly through the Shia neighborhoods ot the southern suburbs, evidently outstripping the ability ol AmaJ and Hizballah leaders to control It:

Amal's successful moves against HttbaHah in southern

Lebanon lasl monthense climate In which theshee were seen as opening salvosarge* confronlallon.

The Cashes gave street fighters on boththose who had tost relatives In the April righting between AmaJ endouthernopportunity for3

In the Fighting

Both sides are spurred by last month's fighting In southern Lebanon. Hizballah hopoa tocore with Amal by demonstrating that It holds the balance of power in the Shia areas of West Beirut. Early In the fighting. Amal apparently was trying to repeat In Beirutained In the south. Amal loader Nabth Barri now probably seeks tooss that will undercut the prestige Amal gained from lasl month's victories. Mg J

resistance*

Both sides appear more Interested In propagandizing iholruick end to the fighting. Barri has chargedturning southern Beiruten of terrorism. Aaccused Barri of selling himself to lhe devil andthe

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confirmed.

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The-Syrian- .

? (he Syrians intervened wrth save ai thousand troopsecisive deleat ot Ama: by West Beirut militias tn voespread street lighting So lar this lime. Damascus ha* been instr%rnenial in arranging the snon-lived cease-tires lhal have punctuated the Current righting and in Indirectly supporting Amal Press statements from senior Syrian ofltciaJs In Beirut indicate Syrian patience with the fighting Is wearing thin. If Amal and Hiiballah cannot end tho lighting. Syria mayorced to rnsiore order

Syria has several thousand soldiers In Wesl Beirut, and man* located nearby, j

Syrian intervention in the lighting would be highly provocative, and its consequences unpredictable7 the Syrians negotiated wllh Hiiballah Ihe lerms ol their deployment near the Shia neighborhoods of southern Bekul The Syrians made veiled threats that Damascus was prepared toer to an of Weal Beirut, the fundamentalists countered lhat they couldyrian presence iheareasgj

The Iranian Connection

Tehran recognizes that Hizballah's success may provoke Syrian miliiary tntervenHon. and Iranian officials haverominent role trying. te> mediate betvueen the two groups

There is some danger lhat conflict could spill over into Irlclion between Syria and Iran, in (he past. Iran has lobbied Damascus on behalf ol Hizballah, and the Syrians have defended Amal's interests

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Implications lor the Hoatagas

The western hostages probably are stm in the southern suburbs,s unlikely thai they wirtmoved oul They are al risk already, andoer iQJJ^emwill rise if lhe Clashes Intensity or Syria

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