SECTION I -- CURRENT INTELLIGENCE

US RECONNAISSANCE FLIGHT SHOOTDOWN SPECULATIONS -- Press speculation abounds, the real story remains to be told. A Taiwan newspaper claims the EP3e was FORCED to land at Hainan. This story from Taipei Times says the claim is based on a Korean military intelligence source familiar with Taiwan's radar and voice monitoring of the entire incident. According to the story, the EP-3 was at low altitude flying in circles around a new, Russian-made Sovremenny-class Chinese destroyer when intercepted. The F-8's flew on the EP-3's wing for a time but with great difficulty because of the low speed -- which may well be what caused the collision. After the collision the EP-3 tried to fly out of the area but was forced instead to land on Hainan by the second fighter which fired warning bursts from its cannon.
            This type of speculation was reported in a slightly different version by a Hong Kong newspaper, which reported Monday (quoting Chinese sources) that after the collision the surviving F-8 requested permission to shoot down the EP-3. The Chinese ground control denied permission. The EP-3, according to this report tried to fly out of the area but was forced by the F-8 to land on Hainan. If these reports are true, the real story is still held within intelligence and buried within US and Chinese Governments in the process of political settlement. (Macartney)
http://www.taiwanheadlines.gov.tw/20010403/20010403p2.html
http://news.ninemsn.com./world/story_11201.asp
http://home.wxs.nl/~p3orion/hainan.html

PACIFIC COMMAND ASSESSMENT OF CHINA THREAT-- Admiral Dennis Blair, Commander-in Chief, US Pacific Command, provided a down-to-earth common-sense assessment of the situation in the Far East in testimony before the Senate Armed Services Committee on March 27th, 2001. He noted that the security balance across the Taiwan Strait is stable, but China's military buildup threatens to tip the scale. But while "China is capable of causing damage to Taiwan . it is not capable of taking and holding Taiwan . The 7th Fleet, in conjunction with the other forces that I can bring to bear, can ensure that China would not be successful in aggression against Taiwan should the decision be made to commit our forces."
            However, he added, certain issues must be addressed to keep the region stable. Each year, the Chinese arsenal that can target Taiwan grows by about 50 ballistic missiles. At present, Admiral Blair noted, the buildup of CSS-6 and CSS-7 missiles is not "militarily significant." But they will become so as their numbers increase and accuracy improves. "There has to be an enhancement of Taiwan's capability." Blair said his recommendation to the administration is based on what his Command deems necessary to maintain a "sufficient defense."
            The United States supports a "One China" policy rather than Taiwanese independence, but it also is committed to the island's self defense under the Taiwan Relations Act. China's view is that the island is a renegade province, but it has agreed not to use military force to resolve its claims. Yet tensions between Taiwan and China persist. (Ed.Note -- tensions appear to be the result of Taiwan's political moves towards independence, and China's attempt to maintain and assert its political claim by a military buildup in the area facing the island). China recently announced a 17.7 percent hike in its defense budget. Admiral Blair said Chinese field commanders and other officials have told him the increase would largely go for personnel and maintenance. A certain amount would go to acquisition, but he does not translate that directly into weapons. The admiral pointed out in this regard that the Chinese are having only mixed success creating an effective combat capability using weapons they purchased from Russia. Integrating training and logistical support with the mother systems is "difficult business," he said.
            Admiral Blair noted that he had told Chinese officials that the "most destabilizing" parts of their buildup are their intermediate- and short-range missiles -- the types China fired into the waters north and south of Taiwan in 1996. The Admiral concluded his testimony to the Senators by saying that Taiwan should not define the entire U.S.-Chinese relationship. "I don't think that a military confrontation between the United States and China is inevitable," he said. "I believe that we should pursue policies which make it less likely rather than more likely." (Jonkers) (DoD Thursday March 29, 2001, American Press Service, Lindda Kozaryn) (http://www.defenselink.mil/news/#News ) (courtesy Tom Hart)

NORTH KOREAN MILITARY THREAT -- IS IT, OR IS IT NOT?-- Over the past year, U.S. and South Korean military officials say they have observed a substantial buildup in North Korea's offensive firepower near the 38th parallel. North Korean leader Kim Jong Il's regime has increased the number and size of military training exercises, continued the production and deployment of medium-range ballistic missiles and amassed 70% of its active military forces within 90 miles of the 38th parallel. Said General Thomas A. Schwarts, Commander-in Chief of the US-South Korean Combined Forces, speaking before the U.S. Senate's Armed Forces Committee last week, "when I look north, I can see an enemy that's bigger, better, closer and deadlier." Included among these forces, he said, are 700,000 troops, over 8,000 artillery systems and 2,000 tanks.
            Some,. like North Korea expert Selig Harrisson, writing in the current issue of Foreign Affairs magazine, disagree. He proposes that "Pyongyang's forward deployments of tanks and artillery are intended to help deter a U.S. pre-emptive strike, not to prepare for another invasion."
            South Korean defense officials, while acknowledging the buildup, say it remains highly uncertain whether North Korea really poses a greater military threat than it has in the past. "Even on the basis of the same information the understanding and interpretation of the data can vary depending on the perspective," a senior South Korean defense official said last week.
            An interesting case of diverging analyses arguing from the same basic facts. Clearly the potential for a devastating North Korean attack clearly exists. But one must comprehend the North Korean culture and mindset. And factor in potential irrationality (at least in our terms). The future, as always, is opaque. Meanwhile it would be well to listen to General Schwartz (and his intelligence staff) closest to the threat. (Jonkers) (Wall St Journal 2 April 2001 // Solomon & Lachica)

CIA STILL ENGAGED IN MIDDLE EAST DIPLOMACY -- Two weeks ago, the White House announced that CIA would no longer take a diplomatic role in mediating between Israeli and PLO security services -- an arrangement formalized at the Wye River accords in 1998. Now the Washington Post reports that a auto convoy containing PLO senior security officials was fired on in the Gaza strip on Thursday by the Israelis while they were returning from a meeting with their Israeli counterparts at the home of US Ambassador Martin Indyk near Tel Aviv, where, according to the report, "a CIA official presided" at the meeting. (Macartney)
http://www.washingtonpost.com/wp-dyn/articles/A43465-2001Apr5.html