NATIONAL INTELLIGENCE DAILY 25 SEPTEMBER 1985

Created: 9/25/1985

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Pressures Build on Debtor.

s?ernwr,s

ml ^ ho,8 OdrnocraUc institutions In lhe region end

C.Vr^ll?eZ^mmurtna-yengaged In confrontational rhelonr-"

ayments. krtnnJt. ^ chemesio cap

merestrazN'* Preaidont Sarney. who has been takinntoughublic wtth iheWF and loroign^hanksmoderate and cooperate -

tHtduhrtg ol nc^nr^ 'necessary to prevent continued economic stagnation and political

u^m'?Uk* Sarney may have been Inlluenced

n""ymore strident al Seoul in Octoberheir we*

0, inadequate. They ma?'

1 . torna.ion.! *

rnone.arW,em.wh>ch,heyc,almueh nf(

3 fi I

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Tensions In Negro*

The tuner a tomorrow tor

lo northern Mmgron Occidental Province could ipolni tar lurther unreal In Ihe tfenlrel Philippine*

_^ Arm, cfMrrus^emonstretors were responvoie lor pr6vo*.ng the violence thai left at loaslivilians dead end more thoneriously wounded. Witnesses, however, report that members of Ihe local mania charged the crowd and. wtien demonsiratora foughtegan liring indiscriminately. Medical

_jlcaies lhal many vcllma were shot while lying

on ihe ground

Mom ihaneople, seeded with militant leftists, are expected io attend the funeralhow of antlgovernment sentiment Heightened public hostility hasolatile atmosphere that could explode with Utile provocation. Government however, remain under strict "maximumrders

II the fune-ai is kept under control, the shooting incident has set boca government cevntertasurgency effort! In hlegros by making me localven more unpopular and undermining cooperaiion wtth olher military and police forces The Communist Party will be exploiting the .Incident In its nationwide propaganda efforts,

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AFRICA: Maw economic Measures

Pretoria receritry announced economic measures designedgovernment concern over rising unemploymentamong ^achqjBagfjgfffffJoBsS

ercent hike In selected customs duties willJOO-miKlonrojects lo create lobs, lo assist small businesses, to

expand yob training, and to provide additions! food rehel Smsf reductions were announced in bank ml or eat rates, credit rosiricHons.

and (axes on the sale of automobliest*-

iThe customs surcharge wilt apply to abouterceni of Jjoultimports and will strengthen longstanding gpvernmont efforts to conserve foreign exchange by reducing demand for Imports of consumer goods. The additional spending on relief for unemployment wfll do little to reduce the number of jobless blacks now estimated at moreillion. Assistance to small businesses and expanded )ob training will be at least as beneficial fo Ihenemploynd whites. Asians, and Coloreds!

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FRANCE: Defense Spending

French Council of Ministers hasovernment budget6 thai Parts claims will provideercent real orowth ai da tense spending after Ihree years of zero growth. fasssBvaaSBBSseaaBBBBsafi lefense expenditures will totalnominal increaaeoTTiercent5 The overs" national budget, however, is to Increase byercent France's nuclear forces will continue to receive the highesta third O' the procurement funds The budget also allocates funds lor military space programs, including research on an observation saleliite andolatellite system lor defense communications^ It does not, however, provide funds for the planned purchasessBSBSesBBBSBBMt nantpon to suppon French intervention oversea*'Baaaaam'

e F'*nc'i claimeal Increaseercent in defense spending Is based on unrealistlcally low projections of inflation. If mnaiion Is higher, os Independent economic forecasts Indicate, real growth In defense spending will continue to be almost zero

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KUWAIT: Rumored Resignation of Oil Minister

ul' MlnbUr Ali Kheflfa intends It.

ational Assembly reconvenes, inn> tried lo resign last summe- following me ol Kuwntijustice Minister bul was dissuaded by lha Amjf. Tho Assembly has accused All Khalifa ol mallaasance In connection wtin ine purchase otilhe US-based Sents Fe Corporation three years ago. in addition. All Kneuia woesle' aft or'the unofficial StOCa market collapsed2 and has beenbMmed lor many of the unsueig neaatlve effects on the economy ^ ^

Laaaafhallle may have itarted the resignation rumors himself to get Ihe government lo reaffirm its support lor rum before the Assembly opens. Even If the Amir complies. All Khallla probably WIU qo through with thohe Assembly debate on the fSante Fe purchase turns bitter. The ruling family may let All Khalifa go In hopes of pacifying the Assembly endash between lhe Assembly and the Cabinet Giving in. however, could prompthe Assampi. to co afterrCrown Prince Saad Abdullah

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ational on company yesterday a- -ounceri another oil discovery Mi Camposdds one banion barrets lo reserves, bui onlyercent economicallyxper technical difficulties Impede exploitation in deep wet*']

TwoLankan Tamil leaders beginningday visits to US Ihis week heir trips suggest India Seas Mile Imminent movemer'm peace process ndian tcra.gr. Secretary goes to Co*ombO 1omo"ow lo push tor iuui iif'HB.

oro Ugroup in Bangladesh to call tor Islamic holy war againstollows meeting in London lasl month between group aiyiecurity forces Should contain any demonstrations V

ikVBsWaPBew*sharp decline in Hungaryha'd currency earningsurrent account deficit0 million surplus lasl year udapest may need to resume IMF standby

leading bank creditors0 million loan thleill also underwrite bulk of loannusually high intereel rate* reflect loan's limited mark stability

Turkey to Invite bids'for'construction of pipeline for gas Impels fromas purchase contract net yetayment termsoscow Insisting on partialarp currency

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Special Analysis

the Meetings Accompli .nad

Thm amrlma ml parly meetings fhef concluded*reetmrdaruftinnM victory for Dmng Xiaoping and hla reform group, bui poliiical cempromlcoa arm apparent In doclalona ei poraeanmt amfiha conserve fleaf ffia key speeches. Protagma ol Qmnmrml Secretary Hu Vmobang and Pramlmr Zhao Zlvang named ro rhe Politburo and Socrotarlat mapand lha cere of rmlcrm Immdmra at thanandful ol orthodo* rmmaln In place and will continue aa watchdogaore modmratm approach on ratorm laauma. Tha military, whoie rmprmamnlatlon on the Politburo dropped tromo three mmmoora,a/or Inatliutlonal Joaer.^"

The one-clay Central Committee planum that met yesterday to endorse PoMburo and Secretariat changeseek ol rwch-lavel eclivlty that included two Central Committee plenums and sn extraordinary conference of party delegates In addition lo party personnel changes, the sessionsarty document on the Seventh Five-Year]

Penp's Achievements

After protracted horsetradlng fhls Bummer, the reform Irlumvirate of Deng. Hu. and Zhao brought the meetings In on schedule end generally cot whal they wanted, they secured an unprecedented resignation ofentralrom thewere replaced by younger, better educatod reformers. Hu pieced three close associates on boih the Politburo and Secretariat,nown Zhao protege also made both bodies Lenders emseiy identified with the reforms nowlight numerical advantage on both the Politburo and the Secretariat. Tho reduction oftnlfitary representatives on both the Politburo and Central Committee advances Deng's plan looro professional military establishment, less prone to meddle in politics.

P^'S^ economic problems over the las. year. ,he

pow8rsenterprises, an Increasehe

continued

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Secret

Compromise

Al-arty coon. Deng ha* oft an soughtisarm critics byard lino In favor of traditional partyn an apparent concession to orthodo. party leaders,nd Dengarkedly conservatlv* ton* In their speeches to the conference of delegate* This almosthile atmere subdued treatment of such controversial topics as Individual

on tne soci-iist content and goals

Politburo Standing Committee member Chen Vunitany ol conservative complaints about reiormharply worded speech to the conference. Chen neverthelessearlong silonee on economic policy by oflertng his endorsement of measure* enacted akice last October's party plenum. Orthodo* leaders such as Chen and Peng 2hen will conlmueemind Deng and Ms allies of the party's socialist Obl^-'OiS

Concerns of reformers and conservatives alike are reftee'ed in guidelines lor economic planning that cell for damping rapid Industrial growth and reining In capital construction The draft proposalercent annual growth In production, less than half of the current rate. Investment In the Plmft first two years apparently win be held to5 level, end1 emphasize the renovation of existing plants and breaking bolt le necks in energy, transportation, and communications afJaTaaaaV

Unfinished Bueinee*

Bei|ing made no announcement on Deng's proposed succession package, which Includes nis cession of the party Military Commission chairmanship to Hu Yaobang and the promotion ol Hu QUI to General Secretary The sessions almost certainly discussed Ibe shuttle and may havo**ndorsed II lor later implementation afc*j mmf

Tho resignations Irom the Central Committee of live of nine ranking members of the Military Commissionhakeup is In the offing If nothingheod act-on In the poiii.csl clout ol Ihe Army will reduce resistance to Hu Yeobang's takeover of tha Military CommisMcmM

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