Created: 5/1/1975

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No ForeignSJissem



Tbe Algiers Accord


Durability ol the Accordlor Iran

Domestic ..


Implications for Baghdad

The Kurds

Iraqi-US Relations

The Soviet View


Iraq's Regional Impact

Subversion and Diplomacy Implications for Syria

Saudi Arabia

Egypt's Stakelgerian Hopes



Iran has long sought to persuade Iraq to accede to Tehran's definition of the border between the two counlries, especially along the Shatt al-Arab waterway. Anxious to establish his own hegemony in the area, the Shah has also sought to restrict Iraqi influence and covert activities in the region, as well as to eliminate foreign leftist influences at work in Baghdad. The Algiers agreement of early March between Iran and Iraq appears to have achieved tbe Shah's first goal; whether the Shah's other objectives can be attained seems more doubtful. Iraq has been freed of its entanglement in the Kurdish rebellion and, for the time being, of the prospectonfronlation with Iran. Baghdad's foreign policy options have Iwen substantially increased.

We speculate below on the implications of the Algiersfor the participants, other countries in the region, and the great powers.

'ThH piperproduced under the auspices of tho National Inlclllernce Officer for the Middle Halt. Itdrafted by ClA tOCI) and coordinated withnd DIA.


Algiers Accord

The Shah of Iran and Iraqi strongman Saddam Husayri Tikriti signed an agreement onntended to resolve long-standing border differences which had ledumber of serious clashes during the past year. Both governments gained important advantages from the accord; Iraq's rebelliousere the big losers.

The agreement consistsublic accord which involves reciprocal responsibilities on two points:

demarcation of land and river boundaries;

the exercise of strict border control andof infiltration of subversives.

The two sides describe the accord as Indivisible; violationingle provision nullifies tbe whole package.

Statements and actions by both sides sinceoint to the existenceecret tinder-standing, the enact terms of which are still unknown. The Shah clearly promised to withdraw Iran's military assistance from the Kurds. This could not be spelled out in the public accord because Tehran always denied giving such help. The disposition of Kurdish refugees in Iran probably was also discussed. Both sides obviously agreed to end hostile propaganda. The activities of foreign powers in the Gulf may also have been treated in Algiers; this has been the theme of statements by officials of both governments and by their countries' media Since the signing.

Baghdad's main concession was its acceptance of Tehran's formula for demarcating the disputed

Kurrli numberillion; they make up aboutercent ot the nnniiUtlon. There areillion Kurds In Turkey,illion in Iran, and several hundred thouiand in Syria.

southern river boundary according to the thalweg principleenter of the navigationalraq had previously insisted that7 treaty setting ihe border along the Iranian shore of the Shatt al-Arab gave Iraq total control of navigation on thehence over access to Iran's Aba-dan refinery and the port of Khorramshahr.was unable to enforce this claim, however.

Strict observance of tbe border controlwould benefit both sides. It would end the sending of Iraqi-trained subversives into Iran to stir up anti-government sentiment among minority groups, particularly the Arab population of Kliu?e* stan. Iranian dissidents presumably would no longei be allowed to promote their activities from Iraqi territory. The major consequence of the provision, of course, is that it has brought an end to Iranian military assistance to the Kurds. This was Iraq's objective and Iran's principal concession.

The withdrawal of Iran's aid reduced tbe Kurds' options essentially to maintaining low-lcvc! guerrilla activity, surrendering to Baghdad, or going Into exile. The accord thus holds out the prospect toebilitating internalcan devote more resources to

Some evidence suggests that the Shah thought Ihe accord alsoledge from Saddam Hu&ayn at least temporarily to freeze the military situation in Iraq and possibly to open negotiation* with the Kurds- Immediately after the accord was signed, however, Baghdad ordered an all-nutIt continued foreek until the Shah was able toase-firc two daysreviously scheduled meeting of foreign ministers in Tehran on Marcho work out theof the agreement. The cease-fire, along with Baghdad's offer of amnesty to rebellious Kurds,onnd Iraq completed its military nc-


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of all Iraqi Kurdistan. It met littleBaghdad, under prodding from Tehran, did extend until the end olthen for an20period during which Kurdish refugees in Iran could return to Iraq.

demarcation and control hasunder the guidance of commissionsby the foreign ministers. The Shatt al-Arahsurveyed, and Jointly-manned controlbeen established in both countries toimplementation of the Algiers agreement Ameeting of foreign ministers was heldhird is scheduled for mid-May.problem has been discussed, along withof wider cooperation. Saddamto Tehran in late April; the Shah is iovisit later this spring.


has long been the focus of Iran'shostility and suspicion because ofand political differences. The ShaltBaghdadtalking-horse forin the Gulf andource ofthe region. For some time Ihc Shahusing Iraqi Kurds to divert Baghdad'sresources away from interference in Gulfto encourage political instability, andpromote Iran's interest in borderdid the Shah consider aid to the Kurdscommitment, however. He did nottheir goal of autonomy out of fear itsimilar sentiments among Iranian Kurds.

The Kurdish equation took on newlast summer when Baghdad decided to use its Soviel-equipped anny lofinal solution" to its Kurdish problem. Baghdad launched an offensive against rebel-held territory that eventually engaged SO percent of Iraq's army.

To halt the Iraqi offensive and to preserve his Kurdish curd, in August the Shah introduced Iranian artillery and air defense units directly into theinside Iraq. The intervention, plus the onset of bad weather, eventually stopped the Iraqi advance. The Kurds, however, were unableegain any lost territory during the winter, as they had usuallylo do in past years.

The Kurdish failure left the Iraqi armyood position to renew its offensive this spring. The Shah was faced wiih the prospect of having tothe already sizable Iranian militaryif the Kurds were lo keep up Ihe fight. The Shah, concerned about the growing possibility of an all-out military confrontation with Iraq and the wider implications ofolicy, decided against deeper involvement.

This decision made, the Shah could only con. elude thai his bargaining position would steadily erode once tlie anticipated Iraqi spring offensive liegan. He therefore made the best deal he could at Algiers. The Iraqi concession on the Shattno small matter iua necessary minimum in the Shah's eyeslausible explanation for hts sudden turnaround in reaching an accorditter adversary.

The Shah realized that deeper involvement in the Kurdish fight wouldarger regionalcooperation with moderate Arab states. Expanded Iranian military intervention would have caused him problems throughout tbe Arab worldime when he was trying to improve relations wiih Egyptian President Sadat and other moderateArab governments were feeling Iraqi pressure to intervene to secure an end to Iranian intervention. Cairo, in particular, was arguing that ending the confrontation would help draw Iraq into the Arab political mainstream and lessen ils dependence on the Soviet Union. The Shah was concerned over Moscow's growing influence in Baghdad, and Cairo's argument may have influenced him.

Pursuit of the military campaign against the Kurds also entailed risks for Saddam Husayn and might have brought his downfall. As in previous years, policy toward Ihe Kurds was causing splits within the ruling group In Baghdad. Tlie Iraqi strongman hadersonal commitmentilitary solution and his prestige was on the line. Yet there were serious problems developing within the mililary over heavy casualties and overinability to respond effectively to IranianAlso, the military campaign monopolized national attention and resources, and Ihe need for military supplies circumscribed Baghdad's freedom in dealing with Moscow.

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ldam Husayn felt he could not afford to end tin- campaign and admit failure. Since the immediate need was to neutralize Iran, he decided to pay tlw required price and accept Iran's view on ther.b

Durability of the Accord

he provisions of the agreemenl arc being implemented. Both sides appear to have complied with their part of the bargain andutual interest, for the moment. In keeping the accord intact

IS Problems may yet develop, however. The Shah,leet, Iraded performance for promise* in Algiers, and there are few assurances that liaq will want In honor all those promises once it has mastered ils Kurdish problem.

Iran's leverage over Iraq was largely lost when it pulled Its troop* out of Iraq, shut off aid lo thend closed it* border. If Baghdad chow lo renege on ils part of the agreement il would be difficult for Tehran to revive an effective Kurdish resistance movement inside Iraq.

We have considerable doubt that there willasting it-conciliation Iran and Iraq are natural competitors In llie Gulf.

They are Ihe most populous states.

Each is rich in natural resources andargeequipped army.

llie Shah and Saddam Husayn have widely differing views of how the region should evolve politically and both aspire to regional leadership and dominance.

riction seems certain lo revive if Iraqin meddling in Culf states, and particularly if it continues lo press neighboring Kuwait to cede territory flanking ibe Iraqi port of Umm Qasr. In any event, each will continue lo ivmpete lor alliev in the Gulf lo strengthen ils polilical and military position.

Implications for Iron DMMlNc

he Algiers accord was one ol two abrupt major polity decisions in early March thatthe Shah's increaslnRly arbitrary style ofother being his decreene-party state for Iran. He apparently consulted no major figures before ditching Ihc Kurds. Most advisers have become "yes-men* and there is virtually no public debate over pohcy issues. Thus there are few safeguards to miscalculation by him, nor any apparenl mechanism for correcting error, beyond Ihe Shah's own perceptions.

he Shah's Kurdish decision has domestic security implications. Many of Iheurdish refugees in Iran are embittered by what tbey regardetrayal, and some of Iran'sillion Kurds have expressed dismay al the abruptness of Iran's withdrawal of support from iheir Iraqi kinsmen.

e think Iranian security forces will be able to handle potential problems from both sources. Iran look the precaution ol disarming Kurdish fightins; men crossingborder prior to its closing and of isolation them from the civilian refugees. Tehran does nol want the refugees to remain In camps ami will attempt to integrate them into Iranian society, possibly fn non-Kurdish areas.he possibility that somv might mitt ei forts toem In areas markedly different from their mountainous homeland.

ai Tehran's request, senlthe refugee camps to reassure ihc Kurdswill be pardoned if ihey return to Iraq.received widely confllcttng estimates onwho have chosen to do does Tehran, lhat Ihe Kurds posesecurily problem for Iran, andlittle Interest in relieving the Shah of


agreement strengthens Ihecapable of seriously challenging Iran inas wellegime whose sponsoishipand Arab radicalism ami reeep'ivityInfluence has long been consideredhreat to Iranian Kcuiily. Iran mayfrom the latitude of some Aiab leadersargued the accord would lead lo aBaghdad's present polilical stance, but

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Syrians, andthatmay now devote inoic attention to its other feuds and border disputes. Turkish leaders welcome the accord because it puts an end to Iran's aid to Kurdish separatists; Ankara feared that there mightpillover of tbe fighting or thatillion Turkish Kurds might lrccome involved in an autonomy movement.

The Shah will try to use the accord tothe help of other Arabof Baghdad's policies. In ending his aid lo the Kurds and normalizing relations with Iraq, he Strengthens the hand of Arab leaders who have been encouraging Saddam Husayn to reduce his ties to Moscow. The accord also helps undercut the charge of Arab radicals that Iran is an implacable foe of the Arabs.

To the extent that the Shah pushes for aof Soviet influence in Iraq, he will come under pressure to demonstrate to Baghdad and other Arabs that Iran isool of US policy in the region. He has previously joined other area states in insisting that Persian Gulf security is the responsibility of littoral states. He now may be willing to enlarge on this line, especially since Princethe Shah feels is more likely to cooperate on regional security than wasore influential role in Saudi Arabia-

Saddam Husayn has referred toollective security arrangement in (he Gulf in several press interviews given since the accord was signed. He said in one that the Algiers accord foresaw some Iran-Iraq security cooperation. This goes well beyond any Iranian statements toommunique issuedisit to Baghdad by the Iranian Prime Minister in late March affirmed only thai the Culf should be "spared all foreignran'spress has repeated this themetimes since the accord was signed Withdrawal of Soviet and US naval forces would leave Iran with the only significant naval force in the Gulf.

The Shah might be willing to state public opposition to the US naval role in the Gulf more forcefully in exchange for greater regionalon securityr for concrete examplesessened Soviet influence in Iraq. It ishowever, that he would at this time work to secure the complete removal of the US presence in Bahrain.

The Shah naturallyeep suspicion that Iraq's foreign policy will continue to aim at creation of an anti-Iranian front in the Persian Gulf. If Baghdad continues to support subversion and radical Arab policies, the Shah probably will consider himselfood position to insist that Egypt andwhichhis reconciliation withIran in addressing Iraqie fears that moderate Arabs wll seek their ownwilh Iraq and even cooperate with Baghdad to limit Iranian influence on the Arabian peninsula.

The Shah's decision to end his suppoit of the Kurds raised doubts about Tehran in the minds of some conservative Arab lcadere with whom ho is on good terms. Oman, for example, was caused to wonder about the steadfastness of Iranian Support in the Dhofar fighting. Muscat probably wasto rumors that an Iranian withdrawal from Dhofar was includedecret protocol to the Algiers agreement. Oman has privately reempha-siz-ed to Tehran its need for Iranian aid. The Shah has shown no disposition to withdraw from Oman.

Jordan's King Husayn is deeply concerned over the agreement, lie had hoped that Iraq could be persuaded to moderate its position toward the Kurds andettlement might be reached under which Bar/ani might retain his position as leader of the Kurdish community. Husayn now fears fraqi subversive efforts, and he now wonders whether the rapprochement may have given the Iraqis license to do whatever they want in the Culf.

The Algiersduring ameeting ofcomplement other efforts to maintain unity within OPEC ranksit eliminatespotentially divisive issue. The Shah probably believes Ihe agreement enhanced his role in the organization especially with Arab oil producing states, who. in the event of worsened Iranian-Iraqi relations, might have found itexpedient to oppose Tehran's policies in the OPEC venue.


Vo Forel&isPi&

for Baghdad

he end of the Kurdish rebellion strengthens Saddam Husayn byulnerability that his critics could exploit. Tlie present Baathis'twhich took powers an uneasy coalition of military and civilian factions. Saddam Husayn. who made the decision to use military means to deal with the Kurdish problem, leads the Baath party's civilian wing. The military'sin tbe leadership, President Bakr, who is seriously ill and inactive, acquiesced. As the fighting dragged on, the decision drew heavier criticism, and the conflict became known asHusayn's war."

iving in to the Shah's demands on the Shatt al-Arab cost Baghdad something in national pride; but, byree hand to deal with Ihe Kurds and lessening Ibe danger of war with Tehran tlie Iraqis gained more than they gave up. There lias been no known public reaction in Iraq against Saddam Husayn's concession to Iran, nor have critics within the leadership tried to exploit the matteT. The possibility remains, however, that if be stumbles on some other issue, his concession on the waterway could come back to bedevil him.

troublesome Kurdish-relatedhave to be faced. Saddam can now redirectenergies. Domestically, Saddam willon repairing damage to Ihe economyfrom the hostilities, which, he admits,lives0 Iraqi troops. Demobilizationwill free manpower to return toand help ease shortages of food andBaghdad, moreover, can now allocateits resources lo accelerating industrialand to efforts to subvert Culf slates

The Kurds

for the dealing with the Kurds, Iraqfree to impose its will. Baghdad willconcessions to Kurdish aspirations forthe loken legislative and executivelast summcT. Baghdad has madeto Arabize Kurdistan by resettlementsee this as part of the long-termthe problem.

Armed resistance hy Kurds on the scale4 Ls now nut of the question. Preliminarysuggest that about one-lhiid ofman Kurdish regular force intend to continue the insurgency using guerrilla tactics. The Kurds are believed to have cached Large quantities of ammunition in the mountains before the Iraqiin March. They may have also laid in additional stores of arms and supplies from Iran before ihe bordcT was closed on Aprilhc Kurds may try to establish lines of supply to the Syrian border. Despite Damascus' well-foundedof the Subversive activities of the rival Baath-ist regime in Baghdad. Syria has more direct means ol piitting pressure on Baghdad than arming Iraqi Kurds.

Some dic-haid Kurds hope Ihat Iran may resume military assistance if implementation of the Algiers accord does not proceed smoothly. Such an eventuality appears unlikely, despite reports that Iran may be training Some Kurds against the possibilityreakdown. Although mutualrun deep in Iranian-Iraqi relations, both sidesajor stake in keeping the newintact, at least for the near term.

The decline in tbe Kurds' fortunes is matched by the disarray in their leadership. Mulla Mustafa Barzant, now in his, the personification of the autonomy movement, has effectively stepped down. Tlie Shah's accord irreparably damaged Barzanis prestige and authority. No remaining rebel commander lias the slalure to replace him. The Kurdish central command may simply disappearumber of independent rebel groups may try to carry on resistance against Baghdad.

It seems clear that without Substantialthe rebels' resistance to Baghdad will beto the harassment of government units and acts directed against economic targets. In theirframe of mind, the Kurds may even strike at Iraqi oilproscribed from the rebels' target list at the insistence of Ihe Iranians, who apparently feared that Iraqi terrorists might retaliate against the petroleum complex at Abadan.

Iraqi-US Relations

end of the Kurdish rebellionof the impediments to improved relations be-


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Iraq and the US. The Iraqis probablythai the US was collaborating withandproviding military assistance to the Kurds.

It is, however, the US role as Israel's principal backer that Baghdad sees as the main deterrent to better relations with Washington, and the Algiers agreement has not affected ibis. For the moment. Iraq probably sees no advantages in ending its status as the only Arab state, among those that broke with the US7 over the Arab-Israeli war. that has not reestablished ties with

The absence of formal diplomatic lies has not obstructed rapid growth in commercialbetween Iraq and the US. In February, for example, Baghdad5 millionfor Boeing aircraft, making Iraq one of the fastest growing markets for US products in the Middle East. Iraq still severely limits official eon-tact wiih US diplomats attached to Ihe interests section in Ihe Belgian embassy. In sum, we doubt that Iraq would be receptive lo any overtures to improve political relations un'css there is achange in overall US Middle Eastern policy.

The Soviel View

To our knowledge, the Soviet Union had no part in getting Iran and Iraq together. Moscow, in fad, probably has mixed feelings about theof the Algiers meeting, although the USSR repeatedly basettlement of differences between Iran and Iraqranting of Kurdish autonomy. Now Moscow presumably is concerned about what Ihe agreement may portend forrelations with the Soviet Union.

Moscow is aware that Iraq may decide to take advantage of decreased regional tensions to accelerate its purchase of Western goods,and developmental assistance, whileits dependence upon and cooperation with the Soviet Union and Eastern Europe. Even before the. Algiers agreement, the Soviets had givenof concern over what they saw as an Iraqi tendency to lean toward llie West. Moscow knows

Ihat the Shah wants lo wean the Iraqis away from the Soviets and io restrict the growth ol Sovietin Ihe Gulf.

On the other hand, the Algiers agreement has some positive features from Moscow's point of view. The end of the Kurdish warhreategime in which Moscow has aslake and with which Ihe Soviets enjoy basically good, if sometimes troubled, relations. Moscow, moreover, no longer faces the unwelcome prospect of being importuned to back Iraq in full-scale fighting againstwhom the Soviets have developed profitable commercial tics.

The Soviets are aware thai over Ihe short term Iraq cannot replace Soviet military hardware, with which Baghdad's forces are almost exclusively equipped. Iraq will remain dependent on live USSB for consumable supplies, spare parts, technicaland training, although Ihe need forwill now be less urgent.oviel advisers are serving in training roles with the army and anre with the Iraqi airhe enhanced capabilities displayed by the Iraqi army were probably largely the result of Soviet training and advice. Recent pnreltases of additionalircraft and Scud missiles,earlier deliveries of advanced weaponry (FROGs,ndre furtherthat Baghdad intends to continue looking to Moscow for sophisticated weaponry.

The -Soviets- however, have not lieen willing to give the Iraqis everything theywo-month delay last year before agreeing lo Baghdad's requests for additional ammunition undoubtedly increased Iraqi concern about its dependence on one nation for its mililary needs. Thisaghdad decision to diversify its sources of equipment. Baghdad has sincethe West for military equipment. France, which already had sold Iraq helicopters, armored personnel carriers, and light tanks, reportedly now has offered to sell Mirage aircraft.

Moscow also knows that there are powerful influences in Iraq at work to impede anyturn away from Moscow. Tlie Soviets racogrrizc that historical animosities. (Ihirust, and conflicting interests will be barriersignificant or lasting accommodation between Baghdad and Tehran.


At the same time. Ihc Soviet Union willto maintain cordial relations with Iraney elemenf ol Us policy in the Persian Culf. Although the accord could even lead to anin relations; the Soviets have reasons to believe that Ihc agreementiflcrenl power balance in the Persian Cull that could further limit Soviet influence In the area.

Arab-Israeli Ramifications

Iran perceiVc* tbe accord with Iraq asto its effort to thaw closer to the Arab states. The Shah, who aspiies to regional leader-ship, does not wish lo be classified as hostile to Arabsupporter of Israel Moreover, it may be his perception that Ihe power balance bas shifted in favor of ibe Arabs. He might alsoan eventual modification of US pohcy toward Israel. The Shah does nol want to be caught short.

Iran's diplomatic, economic, and intelligence ties to Israel are based on pragmatic, not emotional or ideological considerations. One suchis that Israel has served the same purpose toward ihe Arab world lhal the Kurds served toward Iraq: il ha* kept Ihe Arab* off balance and occupied. As long as Israel remains militarily strong and able to absorb Arab energies, the Shah will regard his ties lo Tel Aviv as In his interest, and he willuiet relationship

To Tel Aviv, ibe touchstone of relations with Iran is the continued flow of Iranianmeets about half of Israeli domestic requirements Tehran's reconciliation with Baglfdad will thus not by itself significantly alter Iranian-Israelialthough il has Im reaped Israeli doubts about the Shah's wiUingnesa to supply petroleum should another .Arab-Israeli war break out.

Since the mid I'iOs. Iran aided and abetted Israeli help lo the Kurdish rebels. Israel provided financial and matt-rial assistance and sent military and intelligence advisers to train Kurdish tribesmen at sites tn Iraqi Kurdisluu andew Kurds may have been trained lu Israel. This assistance was possible because of Iranian help and without it there is lillle chance lhal Tel Aviv will continue to aid the Kurds.

The collapse of Ihe Kurdish rebellion and lessening of Iranian-Iraqi tensions will free much of Baghdad's military forces for use against Israel in the even) of another war. In3 Tehran'sa period of tension withresume diplomatic relations with Iraq enabled the Iraqis to send two armoredto Ibe Syrian front We estimate tbat by this summer the Iraqis could again contribute as many as two armored divisions plus some aircraft to any renewal of Arab-Israeli fighting.

Iraq's help might be more effective thant that time the Iraqi effort on the Syrian front was hamperedhortage of tankan Inadequate* logistics system, andin coordinating operations with the Syrians. Soon after the October War. Baghdad took steps lo increase Hs supply of armor transportation and improve its command-atidcontiol procedures. The logistic system appean much mure effective,esult of experience gained in fighting ihe Kurds.

Despite the current cooperation between the two sides, however, Baghdad must still plunder Iran the primary military threat and will deploy its troops accordingly. The Iraqi units will return to their normal areas of cantonment near the Iranian border. The Iraqi army suffered heavy casualties and moderate equipment losses timing the year of fighting the Kurd* but will rqvetiencc littlein refilling and bringing unit* up to strength for service against Israel

The size of Iho force lhal Iraq contributes for service on the Israeli front will lie determined by Baghdad's relations wllh the Arab belligerents when, and if. hostilities break out. Baghdad'scalls for "liberalKin" ol Israeli-occupied leiii-lory should not be read as an open-ended commil-ment of troops to another round of fighting. II the Iraqis do not believe the front-line .Arab statesan all-out prosecution of the war, Baghdad will not be disposed I"aximum military contribution; and ashe reliability of ils commitment would be subject lu live vagaries oi Iraq's political relation* with other Arab

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Regional Impact

he Algiers accord fits into the patternover the past year of Iraqi efforts to project an image of moderation in its regional policy andin the affairs of its neighbors. We arc unable yet to tell whether there is any substance behind the image. Our initial impression, however, is that Baghdad's courtship of some Arabs and now* Iran reflects an adaptation to internal and externalneed, for example to end the Kurdishdoes notasic shift in its foreign policy outlook in the near term.

ast performance does not encourageacceptance of Saddam Husayn's new pose. Although his personal charm and dynamism have favorably impressed even many conservative Arab leaders, and apparently the Shah, his record is thatedicated Baathist revolutionary and meddler in the affairs of other countries,

believe that the Iraqi Baathistrevolutionary in outlook and committedto overturn conservative and moderateIn the Peninsula and the Gulf. Iraq maymore subtle in its tactics, however. Ouris that Baghdad has adopted aIt actively courts its neighbors on Ihelevel, while it continues to interfereime, however, in keeping withspirit of Algiers, Baghdad mayblatant involvement, such as Its supportof an effort to overthrow the Northand lo replace itaathist regime.

Subversion and Diplomacy

Freed of its battle against the Kurds, the Iraqis may well decide to focus their energies onoperations aimed at extending their influence within the states of the Peninsula and the Gulf. Baghdad has never been better prepared financially for such undertakings. Iraq'sillion ingrowing rapidly; by the end of the decade Iraq could surpass Iran in oil production.

In line with its new moderate posture,will probably concentrate at first on building Its clandestine assets through the quietly expanding

Baathist cells in the small Culf countries andsupport of local dissidents. Iraq, moreover. Can Spend liberally to influence local nlficials and politicians. Iraqi embassies will probably acquire additional intelligence and security-related

the sante lime, we anticipate thatconcluding that the Algiers accordearlier Iranian opposition, willa new effort to create some kind ofpact Or joint military unit among theof Ihe Persian Culf. Wcroposal will continue toand Saudi Arabian resistance, as wellby the smaller states.

intentions with respect to itsshould he measurable by observabletests will be how Iraq deals with itswith Kuwait and Syria and its role inOmani rebels and other dissidents.

Iraqi forces continue totrip ofterritory seized inliefear thatfree of the Kurdishincrease pressure on them to cede two islands flanking theto the port of Umm Qasr. The Kuwaitis expect both Iraqi diplomaticand military muscle-flexing along theVarious Arab leaders including Sadat and Boumcdiene have been mentioned as beingin mediating the dispute, andresponse will shed light on its general posture.

Iraq has shown no inclination to refrain from subversive acts against the rival Baathistin Syria. It was just such acts which provoked Syria's latest squeeze of thewater supply and its earlier restrictions on Iraqi shipmentstakla.

To demonstrate its adherence to the principle of noninterference, Baghdad could curtail its support of the rebels in Oman's DhofarWe believe, however, the Iraqis will do their part to keep the Omani insurgency alive, coordinating their support to the rebels with that of South Yemen whileow

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themselves. The Iraqis believe tbey can plausibly deny thai Ihey are providing the arms, nvoney. ami training. Baghdad mayhifl in tactics to political subversion andin northern Oman, arguing that the rebel* can revert to guerrilla warfare whenever the Iranians go home.

If Algiers Iiench-markaghdad will end its support ol Iranianor some time, Baghdad haslmzestan liberation Front to promote separatists sentiments amongArabv and (he Baluchi Liberation Front lor the Baluchi tribes of southeastern Iran. Iraq bus also meddled in Baluchi affairs in Pitkivlnn.

Implicotions for Syria

How Baghdad deals with Syria will also be watched closely. Belations between the two are at one of their periodic lows. In addition to historic animosities between the two countries, Damascus and Baghdad have rival claims to leadership of the Baathist Movement. The news of the Iran-Iraq accord was not well received in Damascus: tbe Syrians would prefer to have Baghdad preoccupied with the Kurds. Tlte Syrians expect the Iraqis to step up their propaganda attacks against Syrian participation in the Middle East peace negotiations and to feel freer to overthrow the Syrian regime.

The Syrians appear to have grounds forInenior official of the Baath Party of Iraq privately commented that the Algiers agreement would free Baghdad toumber of policy objectives among which is the creationovernment in Damascus more ideologically in tune with Baghdad. Tlie official predicted an upswing in Iraqi sabotage and espionageagainst the Syrian Government

In early April, an early issue flared up when the Iraqis charged that Damascus was violating an agreement by diverting waters from the Euphrates River. Tbe Syrians publicly denied tbe charge but privately acknowledged ihey took the step to warn Baghdad to slop meddling In Syrian domestic ai-faits.ew weeks earlier Syrian authorities had roundedocal Baath Party members on charges of conspiring with Iraq to oust President Asad.

Saudi Arabia

agreement gives tbe new leadershipmore latitude to seek better andrelations with Iran During the tensionpast year between Tehran and Baghdad,have found it easy to criticize anyby tbe Saudis as inimical lo Arabsignsarming of Saudi-IraqiHovityn and Prince Fahdwill exchange visits and the settlementproblems appear* to bethat Iraq, free from Its Kurdishnow be able to turn Its attention toaffairs.

Egypt's Stoka

Egypt's role in securing the Iran-Iraqwas undertaken to further Its own efforts to maintain improving re la (torn with Tehran and Baghdad Sadat counts heavily on erwwniefrom both countries, particularly Iran. He further regards Iran a> an important partner and Iraqrincipal target for hb efforts tooderating Influence throughout the Middle East.

The Iran-Iraq disputeajor hindrance to both efforts. Sadat undoubtedly felt that hi* close ties to Tehran endangered Iraq's economic assistance and hampered his efforts to moderate Iraq's opposition to Arab-Israeli peace negotiations. In any case, as long as Tehran was skirmishing with an Arab country. Egypt was vulnerable to criticism from radicals for ils good relations wilh Iran. Also, Sadat is fully aware that settlement of Iraq'swith Iran and an end to the Kurdish war might free Iraqi troops to participate in another Middle East war; presumably he also hopes that improved ties with Baghdad will persuade the Iraqis to participate in an oil emlvargo if war breaks out (Despite its rhetoric. Baghdad did not go along with the OAPEC cmUrgo1 >

Whatever Sadat hopes. Baghdad is not likely lo repay Cairo for its mediation effort by softening


stand against Arab negotiations with Israel. Baghdad sees merit in its rigid posture and no real disadvantages, at Wait while negotiations remain stalled. The Iraqis probably calculate thatan climb On the negotiations bandwagon il they sense that progress is being madeettlement.

or tbe moment, ihe Iraqis, allied with the fedayeen groups that reject tin- Palestine Liberation Organization's willingness to join in negotiations, prefer the adversary role. This posture, they reason, places them in the vanguard of the Arahpurists wlio brook no compromise wilh the enemy. Should Egypt or Syria renounce theettlement, the Iraqis would be quick to point out to other Arabs that tbey were right all along. Baghdad would then exploit ami harness the anticipated radlcalization of Arab opinionIsrael and the West

Algerian Hopes

hough far from the front lines. President Boumediene iindcaibtedly expects to receive tome financial aid and political support for his proposalsew economic orderallout from his part in arranging the Algiers agreement. In need of funds to finance its ambitious four-year development plan. Algeria reportedly hasillion from Iraq and may have also approached Tehran. On international issues. Boumediene probably hopes Iran and Iraq will support his views that oil dig-cussiom wilhe held only in the context of all rawonly oil. that the price of oil should be UaJexed to world inflation rates, and that all uVvelopiog states ihould push for the radical transformation of the world economic system at the seventh special session of the UN General Assemhly next September.

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