Approved For Release 2008 02 14 C I A DP84BOO049R000701780017-6 The Dlrtdor of Central Intelligence D C 20S05 -- - - - 2 Aprl1 1982 The Honorable Alexander M Haig Jr Secretary of State Washington D C 20520 Dear Al --aspects of the Fal kland arralr the forces In or available In the area and possible British Soviet and Cuban reactions Here is a quick assessment on possible military 25X1 sey Attachments Yours D ' ' ' ' ' A roved For Release 2008 02114 CIA RDP84B00049R000701780017 6 ' Approved For Release 2008102 14 CIA-RDP84BOO049R000701780017-6 r ' Ii - 1 - I' I ' iT' Jt ' 25X1 ' Quick Intelligence Assessment on Falkland Affairs April 2 1982 I Brief History of the Dispute The controversy dates to 1833 when the British occupied the island claimed by the Argentines as part of their colonial heritage The dispute was only a minor irritant in otherwise good bilateral relations until Buenos Aires anxious to recover the islands took the dispute to the UN in 1965 The General Assembly declared sovereignty in dispute and established what turned out to be an ineffective mechanism for negotiations Growing economic potential in Falkland territorial ' waters heightened tensions during the mid and late 19705 The latest round of talks which began in February failed in mie-March when the British refusee to bow to Argentine public demanes that negotiations be speeeee up The South Georgia incident began on March 19 escalating into confrontation ane the Argentine invasion Friday Did Argentina plan the Escalation Although there is no direct evidence that the Ar gen ines manufactured the original incident at South Georgia on 19 March they were looking for a chance to put pressure on Approved For Release 2008 02114 CIA-RDP84B00049R000701780017-6 I I 25X1 ' Approved For Release 2i 0 I CIAORDP84B00049Rr 070178001706 25X1 - o 0 the British and at the least quickly seized upon a tactical opportunity to confront the British militarily The civilian group that went to South Georgia had complie4 with all immigration procedures known to Argent i ne and British authorities in Buenos Aires and whether Argentine officials encouraged the flag raising itself is unknown Nonetheless President Galtieri has pursued a generally aggressive foreign policy I 25X1 25X1 25X1 L- __ ____ - I The Argentines re l atively 9uickly came to see L the issue as a military rather than diplomatic problem and the decision to implement long held contingency plans for the invasion was probably made last weekend II Events to Date The Argentines successfully invaded the Falkland Islands this morning some 20Q-3S0 Argentine Mar i nes with armored vehicles evidently went ashore near Port Stanley and airborne units reportedly secured the local airfield There is also information that three Argentine ships are in the harbor at nearby Port W lliams i The Argentines may be debarking as many as 500-1000 from the task force w lJ-armed troops 25X1 I L -_ __ _ _ _ _ __ __ __ __ _ _ __ _ 25X1 Approved For Release 20081 02114 CIAoRDP84BOO049R000701 780017-6 Approved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 Ii ll l 'H l ll I 25Xl There evidently I was sporadic resistance 25X1 25X1 by the small force of Royal Marines and irregulars on the main Falkland Islands and the ice patrol ship Endurance was able to depart South Georgia Island and is now somewhere between South Georgia and the main islands The Argentines appear to be securing t e islands and plan to name the general officer in charge of Army operations as military governor III _ UR Options A Diplomatic The British have broken diplomatic relations with Argentina but they could continue to make use of the UN Security Council as a means of keeping open a channel of communications and as a forum to put Argentina in the dock as an ftaggressor ft They probably do not expect the UN debate to resolve the crisis but they hope it will at least show that Britai n had attempted to find a diplomatic solution before resorting to military countermeasures he British could also ask the ir 3 A roved For Release 2008 02 14 CIA-RDP84B00049R00070178001 7-6 I I 25X1 Approved For Release 2008 02 14 CIA-RDPs4B00049R000701780017-6 C V ' ' i iJ J 25X1 European partners to join in a demarche to the Argentines demanding they withdraw their troops and seek a peaceful settlement or even to condemn Argentina openly is likely to ask th US London to continue to exert pressure on Argentina to see reason and to mobilize other Latin American states to intervene with the Argentines While the British hope that the US will maintain contact with Buenos Aires and perhaps continue to serve as a conduit they probably prefer public us support for the Brit i sh position to jolt the Ar9 ntines and convince them that the US wil l not push London to accept a fait accompli London undoubtedly expects US support at the UN as well London could in principle offer at the UN or in another forum to discuss the ultimate sovereignty of the Falklands but only after a cooling off period and only after Arg e ntine withdrawal from the islands B Economic British economic options are l imited Trade between Argentina and the UK is not significant for either country In 1980 the UK exported goods totaling S402 million to Argentina while imports reached $265 mjllion-representing 0 4 percent and -0 2 percent of total UK exports and imports respectivel y Manufactured good s of 4 A roved For Release 2008 02114 CIA-RD P84B00049R000701780017-6 I I 25X1 Approved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 e if ' Jj t 'd Jo o '-1 If If'1 ' I and other foodstuffs I UK banks hold about IO percent of 25X1 all kinds accounted for nearly 90 percent of British sales purchases from Argentina consist mainly of meat Argentina's total commercial bank debt of $23 billion but this provides no practical leverage London's best hope would be for general US and Ee economic restrictions on Argentina--something that would be hard to enforce The British have never shown much faith in economic sanctions however and in any case the length of time it would take to have any effect would make them politically unacceptable 25X1 5 Approved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 I I 25X1 25X1 Approved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 25X1 A roved For Release 2008 02114 CIA-RDP84B00049R000701780017-6 ' ' - - Approved For Release 2r 08 02 1t S IA-RDP84BOO04r000701 780017-S 25X1 25X1 IV Argentine Responses - Military Diplomatic Implications tor Beagle Dispute The Argentines probably soon will begin reprovisioning and reinforcing their forces on the islands betore any British units arrive Air Force units in southern st en9thened Argentina reportedly were being yesterdaYt the air base at Rio Gallegos in the far south would be a particularly good candidate for receiving fighters and has had Mirage aircraft there in the past It is also possible that combat aircraft could be sent to tne I' A _CT 25X1 roved F'or Release 2008 02 14 CIA-RDP84B00049R000701 780017-S ' ' Approved For Release 2008 0 2 14 CIA-RDPB4B00049R000701780017-6 '1 ' ' ' I CW'J u L 1 25X1 airfield at Port Stanley The field is capable of handling jets and has a fuel storage capacity of 50 000 Ii ters The Argentines however probably will try to s rage increase the fuel capacity at the field to establish command and control communications and to provide maintenance and logistic support as well as protection for aircraft and crews _ While we have no evidence we believe that Argentine ground force units particularly those in the south probably are on a heightened alert status Reinforcements for the iSlands likely will come at first from the 9th Infantry Brigade whieh with a strength of about 4500 is the largest ground unit in the south Other un i ts could be alerted and readied for transport to the south but this probably would take several days to accomplish Transports and other naval craft could be sent to porte along the South Atlantic to f e rr y troops and equipment to the islands Virtually the entire Argentine fleet is involved in the Falkland operations Given the age of many of the units --some are almost 40 years old--and their sustained operations at sea it appears sensible for the Argentines to begin withdrawing some of their more vulnerable naval 25X1 Ap roved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 Approved For Release 2008 0 1 E tti' jiBOO049R00070 1 780017-6 I islands has been accomplished engagement with the ritish I We also do not believe f 11-scale 25X1 craft - once the reinforcement and reprovisioning of the that the Argentines would fare well in a naval particularly in view of the nature of the forces the British are prepar i ng to send to the Falklands I f Argentine ships are attacked ho ever they will respond in kind The invasion bas probably strengthened Galtieri's standing within the military especially the Navy and among predominantly nationalist political opponents who have long advocated invading the Falklands We expect this support to continue even among hardline Peronist labor union leaders who despite repression of their recent demonstration will have little choice but to back Galtieri Like Thatcher Galtieri probably calculates that he will have to avoid appearing to waver or risk serious domestic and international political costs The Argentines see a direct correlation between a tough--and successful--effort on the Falklands and success in their Beagle dispute with Chile Similarly they believe a defeat on the Falklands would be an enormous setback in the Chile dispute thus doubling their stake in the current confrontation o -- ' -- - 9 ApprOVed For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 I r I ' - - ' I t' I 25X1 Approved For Release 2008 02114 CIA-RDP84B00049R000701780017-6 T ' I' 'L o H I 2SX1 Diplomatically Argentina will probably utilize its ties to the the Non-Aligned Movement and to developing nations in the Unite d Nations to try to block Briti sh efforts in international fora tp condemn the invasion Buenos Aires may anticipate- US oPPosition in the OAS but had calculated earlier that they could defeat the British in a showdown in the UN over the issue V Potential for Soviet and or Cuban exploitation Cuba which traditionally has supported Argentina's claim to the Falkland Islands will probably be initially cautious in providing political backing for the Argentine move --Ravana will want to he sure to avoid embarrassment in the event Buenos Aires' military adventure fails Nevertheless the incident gives Havana the opportunity to renew its criticism of the Thatcher government which it views with obvious distaste The Soviets will seek to exploit the crisis by giving political support to Argentina but will not become directly involved militarily The Soviets have been trying to establish close relations with Argentina in large part because it provides more than 10 percent of Soviet grain imports and helped offset the US grain 10 Approved For Release 2008 02 14 CIA-RDP84B00049R000701780017-6 I I 25X1 Approved For Release 2008 02 14 i A -F 9 PB4BOO049R00070178 0 017-6 ti Hlj Ie 1 ' j 25X1 embargo in 1980-81 are already poor In contrast relations with the UR Now that Argentina has already fOE occupied the islands Moscow could call and subsequent talks a ceasefire Moscow will work to avoid UN Security Council condemnation of Argentina threatening to veto it It is likely to use the situation to intensify longstanding but so far unproductive efforts to sell Argentina military equipment To ingratiate themselves with the Argentines the Soviets may provide Buenos Aires with surveillance information of British military moves 11 - 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