Created: 1/1/1997

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This report respondsongressionally directed action contained in the Intelligence Authorization Act for Fiscal Referencing (as amendedf the National Security Act the Act direct3 the President to submit an unclassified report "en the requirements of the United States for intelligence and the activities of the Intelligence Cornmunity. " In keeping with this requirement, this report identifies areas where intelligence is required to meet the national security interests of the United States and reflects the priorities established by the Administration for implementation by the Director of Central Intelligence (DCIJ. It evaluates the performance of the Intelligence Community for6 in terms of its responsiveness to priorities advanced by the Administration.



The Intelligence Community is responsible for providing timely, unique information to the policy level to support USsecurity objectives. entral thesis governing the conduct of this effort is that not all issues are of equal importance to US security interests. The Presidentirective to the Director of Central Intelligence has unequivocally stated that his most: important and irnmediate foreign policy concerns are crisis situations thatirect or immediate threat to US interests, where the introduction of US forces is under active consideration, or where US forces are operationally deployed and at risk.

To this end, the Intelligence Community has provided significant support to US diplomatic activities and deployed US forces in Bosnia and to other crisis areas such as Haiti and Central Africa. In the case of Bosnia, the Community provided near-real-time information, secure communications, immediate and high-quality analysis, and the access afforded by Intelligence Cornmunity liaison relationships to our top diplomats and military commanders. These capabilities have been vital to the protection of US forces in Bosnia and to efforts to implement the Dayton Agreement.

In addition to supporting che US response to ongoing crises, the Intelligence Community has carried out other high-priority, strategic tasks:

against the Administration's priority * intelligence targets: rogueKorea,

Iran, Iraq, and Cuba; major strategic nuclear powers inand Russia; and transnational, borderlessnarcotics, proliferation, and international organized crime.

Ensuring that the Intelligence Community has globalan effective warning capability to provide indications of crises that may require significant US diplomatic activity or military operations; the capability to surge collection and analysisrisis occurs; inimal, though adequate, level of coverage on lower-priority countries.

ound programmatic and financial basis for major new investments to ensure the Intelligence Community increases its ability to deliver distinctive actionable information well intot century.


Rogue States

The Intelligence Community has been directed to conduct end-to-end collection and analysis on rogue states, such as Iran, Iraq, North Korea, and Cuba, whose policies are consistently hostile to the United States. The Cornmunity accords high priority to these intelligence targets. Duringt delivered accurate, actionable informationontinuing basis on these countries. Among the Community's many accomplishments were the following:

ariety of collection means, intelligence provided critical, unique, and timely information on events in Iraq leading up to the fast-paced tactical US air strikes in the southern part of that country during August and The near-real-time capability to identify operating sites as soon as they were active enabled mission planners to identify immediately new threats to US aircraft and potential targets for planned air strikes.

Intelligence provided information on the plans of some of the rogue states to acquire and or retain weapons of mass destruction and the means to deliver them.

Intelligence continued to monitor Iraqi violations of economic sanctions, it also provided evidence that Iran was allowing Iraqi oil exports to transit Iranian territorial waters.

Strategic Powers in Transition

As major states in transition, China and Russia present formidable strategic challenges. Both are political and economic powers that can decisively affect US national security interests; both countries also possess strategic nuclear forces. The Cornmunity continues to monitor the political dynamics and military capabilities of these nuclear-capable states.

esurgent, hostile Russia could threaten US interests in that it stillajor nuclear arsenal ofeployed strategic warheadsange of development programs for conventional and strategic forces. In terms of overall military planning, the Russian Government is emphasizing research and development over production in its parcelingight defense budget. The Community continues to monitor the modernization of its strategic forces, including the

testing of new land-mobile and sea-launched intercontinental ballistic missiles.

has bought weapons and weapons technology from Russia, including modern fighter aircraft, air defense systems, and submarines. In fact, China's once hostile relationship with Russia is now touted by both sidesew type of "strategic partnership" for the next century,trong emphasis on cooperation and high-level contacts. onsequence, the Intelligence Community is monitoring China's acquisition of this advanced Russian weaponry as well as the continued expansion of Chinese strategic nuclear forces.

Transnational Issues

The Intelligence Community also has focused on transnational "borderless" issues that threaten national security both at home and abroad; these include proliferation, terrorism, narcotics, and international organized crime.

Few issues have more serious long-term consequences for US interests than the worldwide proliferation of weapons of mass destruction and the missiles intended to deliver them. Atf them hostile to the Unitedhave or may be developing nuclear, biological, and chemical weapons and ballistic missile delivery systems. The Intelligence Community has made significant contributions to the Administration's efforts to stem the proliferation of such weapons. Some examples of non-proliferation successes include:

The Community identified an important BW agent research, production, and storage complex at Stepnogorsk in Kazakstan and is supporting the current high-level US/Kazakstan talks that have begun dismantlement assistance and will leadedirection of people and facilities--the first US-sponsored redirectionoreign biological weapons plant.

Intelligence revealed that6 Iran attempted to procure precursors for chemical agents which would make it less vulnerable to tho export controls of its foreign suppliers.

Intelligence Community resources collected and analyzed materials (in direct support of US forces in Bosnia) to identify potential CW capabilities in the region.

Joint intelligence effortsW field kit which addressed concerns of the US military.

The President's Counterterrorism Initiative, begun last year, directly enhances intelligence capabilities that are designed to provide actionable tactical intelligence, as well as direct support to, and participation in. joint and multilateral operations while bolstering the classical provision of strategic intelligence. In keeping with this Initiative, the DCITerrorism Warning Group (TWG). The TWG is staffed by representatives from the Department of State, Defense Intelligence Agency, Central Intelligence Agency, Federal Bureau of Investigation, and the National Security Agency. This highly expert group's exclusive focus is on the review of intelligence from all sources to provide warning to senior policymakers on possible foreign terrorist attacks against US and allied personnel, interests, and facilities. The DCI's Counterterrorist Center (CTC) achieved numerous successes inmong which were the following:

Providing intelligence information that led to the foiling of the Ramzi Ahmed Yousef plot to place bombs aboard ten US commercial aircraft in Asiaonspiracy to assassinate the Pope.

Providing critical assistance in determining who was responsible for the assassination attempt on Egyptian President Hosni Mubarak in Addis Ababa.

Working with other elements of the diplomatic and Intelligence Communities to effect the rendering into US custody of Lebanese Sunni terrorist Marwan al Safadi, who was linked to terrorist plots in South America.

Working with the Department of State, to provide extensive counterterrorism assistance to allies worldwide, including states of the former Soviet Unionumber of key Middle Eastern countries such as Israel and Egypt. 0 individuals in SO nations have been trained in techniques and tactics to counter terrorism over the past decade.

In recent years the partnership between the intelligence and law enforcement communities has evolvedymbiotic relationship in which the growing dependency of law enforcement on near real-time actionable tactical intelligence from National Foreign Intelligence Program (NFIP) elements has been matched by the increasing reliance of NFIP analysts on data obtained from operational successes. This cooperation is nowhere more evident than in the transnational issue aroas of counternarcotics and international organized crime.

The^Administration's strategy for confronting the mounting transnational problem of drug abuse and drug trafficking entails the integration of domestic and international efforts to reduce both the demand for and the supply of drugs. The Intelligence Community is helping to implement this strategy by providing coordinated foreign intelligence support to law enforcement and host nation operations and to diplomatic initiatives designed to 'disrupt, dismantle, and immobilize key cocaine, heroin, and methamphetamine trafficking organizations. The intelligence provided supports attack upon all aspects of narcoticsshipment, finances, leadership, and organizations.

In addition to the expansion of narcotics production and trafficking, money laundering, financial crime, alien smuggling and criminal involvement in the gray arms trade are also increasing and presenting significant challenges to governments and law enforcement authorities worldwide. The Administration's approach for combating these alarming transnational trends is toultilateral campaign against the international criminal cartels, especially those in Italy, Colombia, Mexico, Southeast Asia, Nigeria, and the successor states of the former Soviet Union.

Althoughraditional topic for intelligence, the Intelligence Community has become increasingly engaged in these transnational issues, with the following achievements to its credit:

In the broadest cooperative operation to date, involving six Latin Americanajor Colombian maritime trafficker was arrested in Panama City.

With US intelligence and law enforcement support, Colombian forces apprehended virtually all of the targeted Colombian drug kingpins. Moreozen additional traffickers were also captured, including other Colombian drug lords as well as top traffickers from Peru, Ecuador, and Bolivia. Intelligence support was also key to the arrest of several East Asian heroin traffickers.

Intelligence support was an integral part of aalternative development program led by the United Nations Drug Control Program in Burma.

The DCI's Crime and Narcotics Center has developed all-source analytic tools to help expedite dissemination of actionable intelligence to law enforcement agencies.

Intelligence has revealed economic espionage directed against sensitive or proprietary information of an economic or financial nature belonging to US firms.


Global coverage entails providing advance notice of an impending crisis (effective indications and warning) and retaining flexible and resilient collection assets and analysts to enable the Intelligence Community to surge collection and analysissituation or countryemporary basis. These activities focus on supporting diplomatic operations to deter war, resolve conflict, support civil authorities, and promote peace; they include smaller-scale combat operations, peacekeeping and peace enforcement operations, and humanitarian relief operations. They can involve the threat or use of force. By their very nature crises are unpredictable, and US forces must be prepared to participate anywhere in the world, upon short notice. To ensure an adequate response to an erupting crisis, the Intelligence Community furnishes support to the military so that it is prepared to conduct combat operations andange of concurrent operations in distant theaters; this support is as diverse and geographically distributed as the operations themselves:

Actionable intelligence support contributed to the successful US-led effort to end armed border clashes between Peru and Ecuador and6 assisted US policymakers inasting settlement. Tailored analytic support helped the chief US mediator move the parties toward settlement talks, which are likely to begin this year.

Imagery intelligence provided critical insights oh the numbers, status, and location of Rwandan refugees in the Great Lakes region of Central Africa as the international community grappledapidly changing situation and attempted to define an appropriate humanitarian response.

Community agencies to include the Central Intelligenc Agency, National Reconnaissance Office, National Imagery and Happing Agency, National Security Agency, and the Defense Intelligence Agency and intelligence components of the Military Services havo increased their training with US operational forces. One example is the provision of threat modeling and simulation capabilities, varying from one-on-one to many-on-many campaign models for current and forecast threat environments. Military operators now receive training that includes realistic levels of expectations of support that can be obtained from national intelligence systems.

In addition to warning and surge capabilities, global coverage requires sustaining adequate, albeit minimal, baseline coverage on lower-priority countries. The Intelligence Contnunity supports many other intelligence needs that are neither mhard targets" nor candidates for crisis operations. These include environmental intelligence on noncompliance with international agreements and illegal shipments of hazardous materials and waste, as well as economic and trade information. Although the Intelligence Communityelative newcomer to these issues, it has made several contributions both at home and abroad:

Intelligence information and analysis have beenvaluable in detecting violations of international environmental agreements, such as the Montreal Protocol on substances that deplete the ozone layer.

Intelligence support to US Customs and the Environmental Protection Agency has assisted in interdicting illegal chlorofluorocarbon (CFC) shipments headed to the United States.

Intelligence also has begun to enhance official and public understanding of global health threat's, such asarea where some foreign governments withhold information in their official reporting.

Preparing US officials for, and supporting them during, international negotiations on commercial, economic, and financial subjects.

Assessing the consequences for foreign countries of proposed economic sanctions or trade actions; monitoring compliance with--and the effects of--such measures

Exposing questionable trade practices by foreign companies oras bribes, kickbacks, collusive commercial arrangements, disguised subsidies, and so forth--that may be harmful to US firms.


For the Intelligence Cornmunity to ensure its ability Co deliver distinctive actionable information well intot centuryound programmatic and financial basis for major new investments. The Community currently is taking concrete steps to increase significantly integration across programs and to reduce independent, duplicative collection, which previously hampered efficient management. Because activitiesimilar nature were often funded under several different programs, it was difficult to assess tradeoffs between programs or know where best to make reductions. Last year, the House and Senate intelligence oversight committees and the Cornmission on the Roles and Capabilities of the US Intelligence Community (the Aspin-Drown Commission)horough examination of the Intelligence Community's roles and responsibilities. All parties agreed that the DCI needed toore "corporate" strategy for the continued conduct of US intelligence activities.

Central to the successful implementation of this strategy are:

More systematic tracking and refining of intelligence requirements; and,

Better Community-level management and integration of existing capabilities.

The Intelligence Community's corporate approach is manifested in its efforts to make better use of the capabilities that already exist through the creation of the National Imagery and Mapping Agency and the Joint Space Management Board. In addition, the Cornmunity haside-reaching personnel reform effort; better synchronization of human intelligence operations, closer and mutually beneficial dialogue with the law enforcement community, and improved oversight in the areas of covert action and counterintelligence.

Recognizing that the annual budget is the primary vehicle for effecting change within the Intelligence Contnunity, the Report of the Commission on the Roles and Capabilities of the US Intelligence Cornmunity (the Aspin-Brown Commission Report) specifically noted the needetter framework to assess tradeoffs among the various capabilities within each intelligence discipline as well as across the disciplines. ir. applauded the Community's initial efforts toission-Based Budgeting framework which links intelligence activities with the ishnent aiimtlintrf HBmally in the National Security Council's US National Security Strategy and the Defense Planning Guidance of the Department of Defense. By shifting the focus to the contribution that intelligence makes to missions--to intelligence output rather than intelligenceCommunity can assure its customers that their priorities will be accorded maximum intelligence support.

Over the past year, the Intelligence Community hasore efficient process for making program and budget decisions so that the DCI and Deputy Secretary of Defense can determine whether or not their funding decisions will satisfy mission requirements. The first step was to more closely align the process for reviewing the National Foreign Intelligence Program (NFIP) managed by the DCI, with the Joint Military Intelligence Program (JMIP) and the Tactical Intelligence and Related Activities (TIARA) aggregation managed by the Secretary of Defense.

A key component of this new joint process is the Intelligence Program Review Groupenior board of intelligence oversight and resource managers from across the national and defense intelligence communities which identifies, evaluates, and prioritizes cross-cutting programmatic and resource-related US intelligence issues. This group recommends immediate and proactive courses of action to the Expanded Defense Resources Board, chaired by the DCI and the Deputy Secretary of Defense.

Last year, almostntelligence issues were nominated for evaluation by thefrom how to fund and develop new automated data processing systems to whether or not the Intelligence Community should invest in commercial imagery. If an issue wasmajor" issue, working groups were formed to examine thoroughly all aspects ot the topic, including requirements, areas of controversy, funding, and potential cuts that would be made to other systems or activities to free up resources. In total,ssues were evaluated by the IPRG, with changes in funding made

Besides introducing changes in process, the Intelligence Community is actively developing the tools and staff to better analyze and evaluate intelligence programs. Although more work needs to be done in these areas, the Community Management Staff has begun torogram and Budget Data Base System designed toatrix approach to budget analysis, thereby allowing the DCI to evaluate how particular capabilities are contributing to intelligence missions. The database is in its early stages, however, and will need to be further refined over the coming year. Concomitant with this database development is the ongoing acquisitionlanning, programming, and budgeting staff dedicated to aiding the DCI in his oversight of the intelligence budget.

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