NATIONAL INTELLIGENCE DAILY 25 SEPTEMBER 1985

Created: 9/25/1985

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Con Ionia

LaltnPressures Ouikl on Debtors

Heightened Tonsn Kegroi Nolos

Jordan-SjTle: Minor Progress on Bilateraliew Economic Measures France: Datensei

Kuweit: Rumored Resignation of Oil Minister

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Special Aneh/eee

China: Whal iho Meetings Accomplished

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Suiid an Debtors

LafJ* Amarfc-an sed ma opening day Of lite afo underscore fnefrithe"owl (here ere nooy are mogHltlng totagainst Weafern

Alt ol IM Latin spokesmen Insisted In lhan apaaches that debt ia threatening the survival of democratic institutions In Ihc region and thai some new form of rebel must be lound. But only Peru's President Garcia engaged In confrontational rhetoric!

of the other Latin leaders supportimit on dabt payments, such aa Peru has put in place, or even mentioned schemes to cap interest payments. Brazil's President Sarney. who has been laamg an increasingly toughublic with the IMP and foreign banks, waa generally moderateoper alive infJ

major Latin debtor

countriesecent mealing of ihe Cartagena Group merely agieedolution to the regional debt problem beyond rescheduling of payments of principal will be necessary to ptevent conjlnuod economic stagnation and political instability fM

I^BUm Moderate leaders Oke Sarney may have been influenced by planned US initiatives to ease debt difficulties by giving tha Worldarger role. Tho Brazilians also probably hope to benefit Irom any concessions granted to Mexicoesult of its worsened state of external payments and the earthquake.

Posturing among Latin debtors may become more slrident at Ihe IMF-World Bank annual meeting in Seoul in October If. in their view, creditor response to their appeals tor relief is inadequate. They may push hard at the Seoul meeting tor reforms to the international monetary system, which Ihey claim places too mucf|_cjf the burden of external adjustment on (hemp

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eplomoar IDAS

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Tensions In Negro*

The tunmrml tomorrow tor tho victim' ol leaf areeft's

nenlhern Neerei Occftfanfa/ Provinceanpolnr tor turthmr unreal In thm control Phlllpplnmm.

I itm Army claims' demonstrators were esponsible lor provoking ine violence Wat left at leastivilians ead and more thaneriously wounded, witnesses, however, report thai members of the local militia charged the crowd and. when demonstratonilought back, began tiring Indlsclmlnaleh/ Medical evidenceIndicates thai many victims were shot while tying on the ground

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Cxrrvnmt: More0 people, seeded with militant letllsil are expocied to attend the funeralhow of an tigentiment. Heightened public hostility haaolatile atmosphere that could explode with Utile provocation. Governmentowever, remain under strict "maximum tolerance" orders.

Even If the tunerel ts kept under control, the shooting incident has set back government counterlnsugency efforts In Negros by making the local militia even more unpopular and undermining cooperation wtth other military and police forces. The Communist Party will be_ exptolt'na the Incident in Its nationwide propaganda efforts.

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JORDAN-SYRIA: Minor Progrni on Bilateral Issues

the Prime Mlnislers ol Syrte

and Jordan agreed al their recent meeting In Jidda lo end media atlacks end Improvo liaison between border patrols In an effort to prevent infiltration in either direction. Jordanian and Syrian officials plan to meet again in Jidda at the end of October J

(There has alreadyoning down ofsuggesting ooth countries are eagerjo Improvethe atmosphere of their sirained relationship^

ispitethe

reported agreement to cooperate on border security. Syria prooabty will continue to promote forays into Jordan by radical Pafeatlr >ups in an effort to undermine the Hussein-Arafat Initiative!

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BOOTH AFRICA: New Economic

recently announcedmeasures designed lo demonstrate government concern over Hung uner economic hardship among blacks

ercent hike In selected customs duties wilt fund aincrease in protects to create fobs, lo assist small businesses, to expend job framing, and lo provide additional food relief. Small 'eductions wereank interestea, credit restrictions, and taxes on Ihe sale of^

The customs surcharge will apery to aboutercent of >ulhmporU and will slrangthen longstanding government efforts fo conserve foreign exchange by reducing demand for imports of consumer goods The additional spending on relief for unemployment wUl do little to reduce the number of lobiessow estimated at moreleSon. Assistance to amal businesses and expanoed fob naming will be at least as beneficial to thai unemployed whites. Asians, and Coloreds!

FRANCE:

The French Council ol Ministers hashat Paris claims win provideet cent real growthzero growth JjVffaeaaaBesaBBseaai

^defense expenditures willillionpercenihe overallhowever, is to increase by onlyercent. France'swill continue to receive the highesta thirdprocurement funds The budget also aaocates funds torprograms. Including research on an observationatellite system lor defense communications.not, howovrii. provide funds for the planned purchase oftransport to support French

fervontlon i

(The French claimeal increaseercent in defense epessdengbased on unreeiishceify low protections of inflation If -illation is higher, as Independent economic forecasts indicaie^raaf irowth in defense spending will continue to be almost B H

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KUWAIT: rResignation ol CXI Hml.ttr

Oil Minister All Khalifa In ton asreconvenes Ihisied to resign leaf summer followingol Kuwait's Justice Minister bui was dissuaded byThe Assembly has accused Ali Khahfa of malfeasanceIon with the purchase of Ihc US-based Senla Fe Co/poryears ago In addition, Ali Khalifa was Finance Minister afterslock market collapsed2 and has been blamedof iho ensuing negative oHocis on the

4ssBBsMisBSBsfKhalif*hay Startedre^irjnoTionto get the government to reaffirm its support for himAssembly opens. Even If lhe Amir compiles. AH Khalifago through with the resignation If ihe Assembly debate onFe purchase turns bitter. The ruling family may let Ak Khalifahopes of pacifying me Assembly andlash betweenand Ihe Cabinel Gmng fee, however, could prompt criticsPrince Saad

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Brazil'sil company yesterday announced another oil discoveryampos Basin dds one pillion barrels lo reserves, but onlyereeni economically recoverable jense. technicai difficuii.es impede exploitation in deep water

Two Sri Lankan Tamilegmnnjday visits to US IMS their trips suggest India sees little imminenteace Indian foreign Secretary goes to Colombo tomorrow to push to- Cease-'re

pro-Iranian group In Bangladesh to lamtc holy war againstollows meeting in London last month between group endecurity forces should contain any demonstrations

iarp decline Inerd currencySurrent account deficit0 million surplus lealdepeat may need lo resume IMF standby program6 !

loading bank creditors0 million loan thisill also underwrite bulk ofnusually high interest rates reflect loan'a limited. M

Turkey io invite bids for construction of pipeline lor gas Imports from USSR . gee purchase contract noi yet payment lorms Moscow insisting on partial payment In hard currency!"

S peciel Anaiya.a

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aeries ol party MMlMgi lhal concluded yaaiarday marksvictory lor Dang Xiaoping and him ralorm group,compromises mra apparent In decision, onIhm conservetlve tone at lha key speeches. Protege'Secretary Hu Yaobang end Premier Zhao Zlyengthe Politburo and Secreterlat espand Ihe core olet thenandful ot on hod orIn piece end mill continue ea watchdog, favoring aapproach on ralormThe military.on the Politburo dreppedlromlO loa.a/or Inatllutlonal loaer.

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The ono dir Central Committee planum that mat yesterday to endorse Polllburo and Secretarial changeseek ol high-level activity lhal Included two Central Committee plenums and an extraordinary conference of party delegates. In addition to party personnel changes, the sessionsarty document on the

Seventh Five-Veer

Oeng'e Achievements

Alter protracted horselradlng this summer, the reform triumvirate of Deng. Hu. and Zhao brought the meetings in on schedule and generally got what they wanted. They secured an unprecedented resignation ofentralrom thewere replaced by younger. Doner educated reformers Hu placed three close allocates on boih the Politburo and Secretariat,nown Zhao protege also made born bodes Leaders closely identified with the retorms nowlight numerical advantage on both the Politburo and the Secretariat The reduction ol military representatives on both the Politburo and Central Committee advances Donga plan ioore

lone! miliiary establishment, less prone to meddle In politics.

Despite widely publicued economic problems over the laat year, the proposals on the Five-Year Plan strongly reaffirm the reform program approved last year. Tne Plan guideunet ca" forans>on of decisionmaking powers by enterpr.ses. an increase in foreign borrowing, and continued promotion of foreignhe special economic :onei J|

conimued

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Al makv party convocations Dengoften sought lo disarm critic* bye in lave Ot traditional party values. In an apparent to orthodox party loaders, both Hu and Dengnserveirveheir speechesha conle>snce ol This almost certainlyhke atmore subdued treatment of auch controversial topics as individual

reater emphasis on tha socialist content andreform

Politburo Standing Cornmltlee member Chen Yunany

of conservaiive complaints aboul roformhsrpfy worded speech

loconference. Chen nevertheless andedyearlong silence on

economic policy by offering his endorsement ol measures enacted

since last October's parly plenum. Orthodox loaders such as Chen

and Pang Zhen will continue to remind Deng and his alilos ol the

party's socialist

Concerns of reformers and conservatives alike ate reflectedlor economic planning that call for damping rapidsnd reining in capital construction Theercam annual growth in producllon. lees than halfCurrent rate. In vealn the Plan's fkal two yearsheld lo5 kwef. and Beijing win emphasizeof existing plants and breaking, bottlenecks Inand ccnvnunlcaitons

Bailing made no announcement on Deng's proposed succession package, which includes his cession ol the party Military Commission chairmanship to Hu Yaobang and the promotion of Hu QUI IO General Secretary. Tho sessions senost certainly discussed the shuffle and ay have endorsed it lor later Implementation MM

The resignations from the Central Committee of five of nineof the Military Commissionhokoup is inIf nothing else, the across-the-board reduction In theof theeduce resistance to Hi, Yaobnng's takeover

zs Sae-emt-Tisas

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