CENTRAL AMERICAN MONTHLY REPORT #2

Created: 9/30/1983

OCR scan of the original document, errors are possible

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DIRECTORATE Of INTELLIGENCE

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CENTRAL AMERICAN MONTHLY REPORT 12

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Oraralln Cantral America contlnee to be tnettee ot dramatic military etteekaforeem here met lacreaaed preeearm en tarniaalvador, the inevryeets neve finally launchedoftenelve to regain Vte military initiative, end the Armyhard preeaad to reepcnd effectively. In oaatemala, thegovtrmeat te preeetam tor revivaleylonelmhlle Indicating It may hold eleetloaa earlier than in Bondaraa, freeldent Seaao la reeowerlne veil fromattack, and tha Army haaaban-dlcaragaeneat ep an laavrgmnt Intraatractare. Coete Mlctm relationehew* been farther damaged be the capture of alet and aeverel Sandlntata mold tare be Coete Memo In Panama, the withdrawal ot Oeneral Paredee tramrace haa raised the possibility that Preeldent deamy attempt to attand hie etay la office, finally,peace effort haa nanto etey on track withby the Central American cemntrtee to"**

obJactIres tor farther clarification.

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Military

Military activity In September was highlighted by an upsurge Of guerrilla operations and Increased Arty casualltlea. Tho insurgent attack on San Miguel in early September wae followed later in th* aonth by the brief occupation of Jucuaran, in *outh*aatern Daulutan, and by attack* against govarnaent force* and *conoaic targets in Norasan, San Miguel, and Sanll the Insurgent faction* apparently are taking part, and th* fighting ha*spreadl Salvador (see asp).

The attacks by the guerrillas probably are part of their long-awaited joint offenalva, but they have failedo attract any wld*apread popular auoport. Indeed, leader* of th*People's Revolutionary Aray faction recently indicated they war* encountering strong resistance In Cabsnss and San Vicente to their atteapta to win over the local population.

Ith* guerrilla* plan to Intensify nas Departments, and will conclude aajor action in Chalatenango. lnaurgenta hope to attack the

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The upsurge In Insurgent activity hae raised concern over government troop fatigue and eoate aupply ahortagea. Salvadoran allltary leader* also hav* voiced dissatisfaction with the departmental commander In Daulutan and with the performance of several elite unit*. One attache report indicates the Army commander in San Vicente nay be given control of the Daulutan operation.

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We have had little information of new arms deliveries to the Salvadoran Insurgents over the past month. Salvadoran officials believe the flow has been greatly reduced by antl-Sandlnlata Insurgent activity in Nicaragua, but there Is little firm evidence to support thi* contention. Moreover, tha fact that th* Salvadoran guerrillas have been able toelatively high

rat* of offenalve activity in September indicates that shortagea at arae and ammunition araerioua problaa.

Meanwhile, tha arae traneehlpaent facility on La Pelota Ialand off northweetern Nicaragua waa deatroyedommando raid by antl-Sandlnieta inaurgente oneptember. The facllitito tranafer anaa to Bl Salvador In large canoea.

Political

The firat meeting between guerrilla leadere and aeabers of the Salvadoran Peace Coaalaalon took place in Bogota, Colombia onugunt. Little of aubatance waa discussed. In public atataaenta after the aeeting the Inaurgent! continued to lnalatower-aharing role in governaent before they would agree to participate in elections. The second aeeting took place onepteabar, again In Bogota, but the insurgents want subsequent aeetinge to be held In ll Salvador. ataaM

eaner of tne lnsurgsnT political coaiiaaion in Auguat while In the Dominican Republic. Christian Democratic Party chalraan Julio Bey Prendee alao clalaa he hes been in contact with aeebere of the Popular Social Chrlatlanaction within tha Inaurgent political front. The secret aeetlngs are dangeroua for the Salvadoran repreaantativea who risk ultra-rlghtlat charges of conspiracy snd poaaible death squad retaliation If they become known. B

The Conatltoent Aaaeably alaaed itseptember deadline for approving the draft conetitetion. hird ofrticles have been approved, and aoae of the aoet controversial reform laeuea have yet to be addreaaed. Labor organisations lobbied the Aaaeably to urge tbe adoption of artlclee that would not Inhibit tha formation of caapealno unions. eault, several union officials wsrs hsrssssd snd threatened by ultrarightlat death aquada,roa1nant labor leader waa kidnapped In late Septeabar.

Although elections heve been postponed until the first quarter of neat yesr, several preaidentiel hopefuls have started campaigning. The Chrlatlan Deaocrata* Napoleon Duarte, the only candidate thua far formally approved by his party, continued his active campaign at home and abroad. Rational Conciliation Party

leader Prenclaco *Chachl* Guerrera ia campaigning hard to become hisandidate. spokesmen for tha ultrarlghtiat ARENA partyoberto D'Aubulaaon is still their aoet likely candidate. Party leader Hugo Berrera aald he would accept the ARENA nomination if O'Aubulaaon doea not run. Meanwhile, arena la attempting toightwing coalition toictory by Duarte. J

Rlghtvlng death squada atepped up their act.. not only againet union leadere but aleo againat alleged !is nt collaboratora. Three university professorsember of the Salvadoran Foreign Ministry were kidnappedeh guada in September. According to Catholic Church statistics, as many asidnjpplngs attributed to death aquada occurredne week. The Aeaembly overwhelelnglyropoaal calling for the defence ainieter_to lnveatigate the upsurge In death squad

activities.

Military

The antl-Sandlnlata inaurgenta changed their tactics during September in an attempt to gain aoaantua and Increaae their iapact on the regiae {see map). At month's end the Honduran-baaed FDR wss able to enter briefly parts of the northweatern town of Ocotal, announcing at tha aaaeew canpaign to take the war to the cities. The sain thruat during the aonth, however, was an increaae in inaurgent activity in central Nicaragua. Teams froa tha FDR also ssbotagad the country's only crude petroleua laport facility. The full extent the daatge not yet known. Bssmmmmmmmmmmmmmmmm!

The Deaocrstic Revolutionary Allianceeing aaall aircraft, carried out several highly publicised bombing raids. Two ARDB aircraft attacked Manegua'a Sandlno AirportIGHT* alte near the cityepteaber, damaging the airport teralnal and hangars but losing one of the aircraft and lta pilots. Tbe nest day two aircraft attacked the port of corInto, reportedly causing ainor daaage to acme cheaical atorage tanks. Finally, ARDEhermoelectric plant in Puerto Sandlno and an

Overall, tha air ralda and eibotage gained draaatlc publicity for tha Insurgents, but the lapact on the Mlcaraguan econoay appeara alnor. Revertheleae, the attache probablyauaed the Sandlniata leaderahip aoae concern. The Inaurgenta have pointed up significant veakneeeee In Sendinlata air and coaatal defenees, and they have aade the var suddenly aore visible to the general population of western Ricaregua.

In the wake of the aerial boabinge, tha Sandinistas have been atrengthenlng air defenee allitary positions at Sandino airport and Corinto, and new emplacements have bean identified in other locations. Furthermore, Junta leader Daniel Ortega Indicated thet the air raids juatlfled Sandinlata effortstain coabat aircraft. Sis statement caae on tha eve of hla departure for Cuba on tha way to tha OR General Aaaeably session.

Meanwhile, Cuban allitary advisers continue toajor role In supporting the Hlcaraguan allitary.

A new military conacriptlon billrushed throuqh th* Council of State and approved by the junta deeptte eonalderable proteat by the Catholic Church and other oppoeitlon groups. The lev requiresoeara old to register for active duty by January, and salea up tore eligible for reserve doty. The Sandinlatas haveropaganda campaign to drua up support for the law and to dlacredit opposition political and ^Churchleaders for their lack of patriotism. Jhundred draft age youth have avoid registration, which begins In October.

the Sandinistas are discussingelection! foBTffT?TlJTBTn* Idea feces several obstaclee. The Council of State has only recently establlahed aias ion to dtaft an electoral law, and the Sandinlsta Directorate reportedly la dividedotential prealdentlal candidate, while Managua is under eonalderable foreign preaaure to awe up the elections, hardlinera may point to uncertaintlss about the future of the inaurgency and wanterpreeelon of weakness by yielding to preesure.

Recent announcements byofficials Ulustrste several facets of Ricaregua's close relatione with Cuba. Antudenta left for technical training in Cuba, bringing the number of Rlcaraguan civilians studying there to. uban aedical etudents were scheduled to arriveear tour of service, raising total Cuban aedical personnel la Ricaregua. Ia lataigh level Cuban economic mission arrived to participateeeting of tha Rlcaraguarv-Cuban aised ccawaleaion.

Junta member Ramlres'a trip to Mongolia and Rorth Korea, and tbe visit of Vietnam's foreign Minister to Menagos, further solidified sandlnlate tie* to communist statea. The Sandlnlsts prase haa taken tha Soviet aide in the Korean airline incident, but Ricaregua abatalned In the OR Security Council vote to preserve th* facade of nonallgnment. Meanwhile, Interior Minister Serge's current tour of eight western Soropean ststes underscore* the Sandinistas' vigorous guest for their aupport.

Economic

1 earaa become an observer to CEMA, the Communist trade orcan, which should help the Sandinistas to diversify their trade and obtain aore Soviet bloc aid. Tha North Roreena recently pledged econoaic and technical asslatance, and the Ciechalaneload of aedlcel euppliee in late Auguat. Ricarague alao la receiving larger amounts of aid froa the West,8 alllion in food aid froa the European community and the Hetherlande, and credits froa prance and Auatrlalllion. BREJ

The tense political atmosphere surroundinguguat coup has saaed, but new Chief of State Mejia does nottrong constituency In the allltary and his governaent haa acted tlaldly on aajor policy deciatona. Mejia Is concentrating on raassarting tbe allltary chain of command to gain the support of the officerrepairing governaent relations with tbe aajor political parties and Catholic Church, groups that ware alienated by former President Rios Montt. Thus fsr, tbe allltary tentatively supports tbe new leader, and civilian political forces have muted their criticise of the goveraent while awaiting some concrete policy decisions by Mejis. Among other groups such aa labor, rural peasant organisetions, and newly formed centrist and leftist parties, there Is substantial appreheneion that the Mejia government will return to the repressive and heavy-handed counterinsurgency tactics of former goveraents* ^mmmmmm^Haaa

Hsjls has aade few significant policy decisions to dste. Be publicly committed hia governaent to hold constituent esaeably elections by nest July but, according to two reliable allltary sources, be may accede to pressure from the ultrarightlst

national Liberationto aclvanea tha schedule. Tha governaent also cancelled the re-registratlon ofprogram Intended to reduce electoralalao waa opposed by the eatabllehed political parties, tn atlll another move to placate the right, Mejia abollahed the Council ofonly political conduit for Guateaela'e Indian population. finally, Mejia has reduced the rate of Rios Montt'a controveraisl Taloa-added tax, another move favored by rtghtmlng parties.

Mejia has softened the pro-OS rhetoric that characteriiedfirst weeks in office, but ha Is likely to continue supporting OS policy objectives In Central Xaerlcm. Oaatemala i. selecting candidates to teach at the Regional Military Training Center in Honduras and ia trying to revive the Central America Defense Council. The Council, which would also Includealvador, Rondurss, Panama, and Coata Rica bat emcled* Rlcaregua, wouldechanlaa for tbe regional al car lee to eichange Intelligence and engage in joint training and coasMi operations.

BUttfaS

The insurgents were unable to mount coordinated or prolonged attacka on government targets during September, but they did step up their terrorist activity, particularly urban bombings and kldnappinga. in rural areaa they continue to aabotage economic targets and ambush saall patrols while avoiding sustained engagementa with governaent forces.

The government haa not initiated any aajor operetlons or aobetantially lnoreaaed its level of patrolling. The military ii moving aheadios Montt prograa to deploycivic action- coapanlee designated to control and train theatrols and Implement social service projects ia the

Highlands.

The government finalised an IMP agreement5 million that had been negotiatd by the Rios Montt governaent. Guatemala will be able to draw on the loan over the nest alsteen months to

held reduce ition foreign debts. The IMF agreementGuatt-elan government effort! to curtail publicend increaseapur eoae additional cradit froa foreign landara. jm

political

Tha racant reeignatlon of Joaa Aicona, tha highly respected Minister of Communications, Public worka, and Transportation,an open apllt In Praaldent Suite'a ruling Liberal Party. ower atruggle between future prealdential hopefuls Aicona and Mlnlatsr of the Prealdency Carloe floras alao haa led to Aicona'a removal as chief of tha Liberal Psrty. Ths factionallea in the Liberal Party coasslae whan frealdant Butio'a health probleaa have raised public speculation about his poesibls socceeaor.

for the aoaent, flores appears to be in firs coaaand as fluaso'a principal troubleahooter, both In the government snd tha Liberal Part.

several terrorist boablnga have occurred during the past aonth in and around the north coeat city of fan Pedro Suls. srilst group haa clalaed cradit for one of the incidents, but ths others reasln anonyaoua. Ban Pedro aula, tha largest city in

this sraee facto eecond capital for the country, la a

traditional hotbed of leftist labor and student activities,

Military

Thaay appears to haveuban-aicaraguan etteapt to establish an active inaurgency in 0lane ho Department. By the acnth's endew Isolated groups out ofonduran guerrlllee who infiltrated froa Nicaragua in July remained at large. Many of the guerrlllss deserted or surrendered becauae of hunger and deaorallsation. They have detailed the eatenelve training they received in Cuba

and Nicaragua, others war* found dead of starvation, andfew were HI led inayey flonduran Insurgent leader.

Tha failure of the operation aay oauaa Nicaragua and Cuba to rethink their plana toull-tie* Insurgency In One of the captured guerrillas, however, clalaa thetIneurgents ara waiting in Nicaragua.

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Relations with Nicaragua have worsened In the last smth. Nicaraguan chsrges that antl-Sandinista air attacka In September, originated In Cnata Rica have promptad San Joaa to cancel tha antat Ing of the mired ooaalsalon on bilateral relationa. in addition. Coata Rlcan authoritiesaaque terrorist who reportedly entered th* country via Managuaission targeted againat antl-Sandlnlata leaders Paatora snd Robelo. Most recently, security forces capturedrmed Nicaraguan soldiershotographer on the northeast coast who bad penetrated aoa*ilee into the country, possiblypy

Meanwhile, tha masher of Nlcaragusn refugees crossing tha border haa aurged over th* peat aonth. At th* preeent rstaeek, the government's two refuge* camps near tha Nlceraguan border will be filled to capacity soon. Ths ria* In refugeea may partly reflect tha heightened allitary action In aouthern Nicaragua by Inaurgent fore**. Government officials have made no progress In eetablleblng two camp* farther south, away from tbe border area. Thaw probably worry that present continued lnflus of refugees will aggravate Coata Rica's already severe unemployment problem.

ove apparently designed to defoae tensions. President

"cogs announced th* provisionseutrality statute In hisepteabar Independence Day apeech. The statute declares Coetaneutrality in all international armed conflicts, but asaerte this does not Imply impartiality in ideological and political conflicts nor toward atstee guilty of eggreeaiou againat countries to which Coata Rica iacomaittsd by virtu* of regional collective security system*.

proolamation policyecurity crackdown la tha wlcaragean border region, vhloh reportedly resulted in the arrest ef see*fastora'a supporters along with weapons and supply boats, theee aetlons, which weakened psstora's logistical support network alone the atlantic coast, war* cited as proof by fen jose that it is enforcing its neutralityalanced way. res* border attack into wicaratju* by pastora'a force* at the end of the aonth war lead to farther crackdowns byean sacarlty forces. ^hhbja_bb|

|concmflo

president monge's strict austerity prograa survived its first eajoc test thi* past aonth in the foraf work stoppages and labor strikes by publicnion* seeking large pay hikes. the adalnlstrstlon waa able to persuade th* unions to accept onlyost-of-living increases by grantingving compromise on backpay. moreover, figures released in late auguat ahow that employment is upercent end personal incoae i* up is percentear ago. bjbbja*.

good news also cm froa abroad in the fora of^rmnefotlation of0 alllion foreign public debt with 1nternationsl creditalso5 alllion laport credit agreement in early septeaber. y eapreaaed an additional vote of confidence in the recovery by approvinglllion loan beyond its2 standby agreement to compensate for esport losses suffered in th* international aarket because ofrices. bmsbj

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septeaber waa characterised by heightened political turmoil ia panaaa. several key cabinet officiala. including foreign

minister haa so, mar* replaced by president da i* eepriella in aa apparent compromise retched with nam watlonsl ouardoriega. sorlega probably homed to atrengthen hia support outside tbeundermine that of retired ousrd chremoving minister, loyal to his predecessor.

amado's aocceaaoryd enormer communist ard.nt nationalist, whoisaar of tbe panama canal comsilsslom. de la baprlella haa ssaurad os officials that be

willor* direct tola In, implying that ha will llaltnfluence. Rla appointment probably la aeant toeturncre traditional neutraliet foreign policy line, thereby arreetlng an earlier awing to the right under Paredes.

Nora laportantly, the cabinet ehuffle elao appears to have Induced Parades to announce he will notandidate in prealdentlelneat yeer. Noriega prevlouely had eought to aasura the political oppoaltlon that tha allitary will reaaln neutral Incoalng alaotions, thua implying Paredee* candidacy did not enjoy Guard support. Parsdea had hoped to win support for his candidacyignificant portion of tha oppoaltlon, as wall ss froa tha government and leftist psrtias, and ths failure of his national unity them* to catch on aleo nay have contributed to his withdrawal. mmmmmmma

Parade* subeequently charged Noriega with treason for reneging on hia proalae to aupport Paredea1 preeldential candidacy, paredee aay have hoped that the public attacks on hia aucceaaor and othsr governaent laadera would create oppoaltlon to th* governaent and help bia regeln political aupport for his eaapaign. Bis outbursts have produced little ayapethy for his iitIon, however, snd epparently have Isolated hia further.

The heightened political tension aay proapt governaent leadara to poatpone national electlona acheduled for neat Nay.

while It remain* Biied,be consideringelay,

eaeplte public aaaurancee to the contrary. Poaaible scenario* likely wouldengthy eatenalon of th* preaident's current tera of office, or an electoralrestrictions no twit hed* la Isprlella.

Iconoalc

Theear of poealble large-scale capital flight waa alleviated earlier thla aonth,t allllon cradit agreement waa reached with foreign benke. The arrangement, which avoided the far leea attractive optionormal debt restructuring, waa negotiatedyndicated elx-year club loan. bbbbb

Meanwhile, Preeldent de la taprlella contlnuee to streea economic austerity aeaautee. Ha aleo recently announced plana to initiate atepa to strengthen foreign trade,eview of existing trade treatlea to bring them Into line with eiietlng economic conditions. Lastly, tha recant cabinet shifts also ebould help enhance thaontrol over economic eattara, and provide Panamaonservative economic more aympathethlc and attractive to local and foreign Investors.

The foreign nlniatera of tha five Central American countries and the Contadoraveneiuela, Colombia, anda document of objectives at tbe conclusion of their meeting In Panama this aonth. Ths document conaolldates previous proposals by Nicaragua, the other Central Americana, and the Cancun declaration of the Contadora preaidente. The Panamanian foreign ainistsr visited central Aaerlcan capitals on behalf of tha Contadora presldenta In late Septeabar, and announced that the objectlvee had been approved by all the governmenta. Mexico recently announced that the Contadora foreign Ministersst again In Pinui in early October.

ley provisions of the documentalt to the allitaryan on foreign allitary bases, withdrawal of foreign allitary advisers, an end to subverelve efforts, snd aupport forincluding free acceaa of political groups to the electoral process. Seven of theoints eddress econoHlc and social matters. The document calls for iaaedlate nagotiationa to conclude treatlea to formalise tha ccemltaents and to guarantee eatabllahaent of verification aeasuree.

. While

restatement ol objectives represents little progreaa In Itatlf, thafour" coantrlaa ara pleaaed becauaedocument endoraes cantral alaaanta of tbalr peace plan. It alsoeference point for pressing the Sandinistas on demonetisation and verification, two provisions that D'Bscoto triad to oppose. Severtheleee, the vagueness of the document underscores that fundaaental dlaagreeaenta between the Sandlnlatas and their neighbore renin. The Halted eonaensua helps to keep the Contadora proceee alive, but It will be difficult to reachagreements at aubeeguent aeetlng a. BBBBBJ

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