C.I.A. Head Surveys World's Hot Spots for Senate

By TIM WEINER
Special to The New York Times

WASHINGTON, Jan. 25--In a tour of the world's horizons from his perspective as Director of Central Intelligence, R. James Woolsey said today that his major concerns include the possibility of destructive hyperinflation in Russia, political and ethnic tensions that could fragment Ukraine and a military buildup in North Korea.

While none of these events pose an immediate danger to the United States, "the end of the cold war does not mean the end of conflict, nor the end to threats to our security and to that of our friends and allies," Mr. Woolsey said during testimony at a public session of the Senate Select Committee on Intelligence.

Mr. Woolsey said the C.I.A. is trying to sort out confusing and conflicting data on the Russian economy. He said the agency worries that "looser fiscal and monetary policies aimed at easing the pain of reform will unleash forces that could bring Russia again to the brink of destructive hyperinflation."

If that brink is crossed and inflation destroys Russian citizens' savings, he said, "it would be a very heavy blow at democracy and the political structure" that President Boris N. Yeltsin is trying to achieve.

In Ukraine, Mr. Woolsey said, independence celebrations have "given way to disillusionment as a result of economic mismanagement and political drift."

"Reform has been nonexistent," the C.I.A. chief said. "Energy shortages have become a way of life, the inflation rate for December was 90 percent, and nearly half of Ukraine's citizens are living below the poverty level."

Mr. Woolsey said a potential crisis lies in a rising secession movement in Crimea, the only region of

Woolsey cities North Korea, Ukraine and Russia

Ukraine where ethnic Russians are in the majority. Their clamor for reunification with Russia threatens to fragment the fledgling republic, he said.

North Korea, which has built one or two nuclear weapons, according to the C.I.A.'s most recent classified estimate, has vaulted to the top of the agency's agenda in recent months. Mr. Woolsey said the politically isolated Communist nation is likely to continue to produce, process and stockpile significant amounts of plutonium for use in building nuclear weapons.

North Korea Rockets at DMZ

Mr. Woolseyalso warned of "what North Korea calls its war preparations program, including improvements in military capabilities and continuing efforts to bring their economy and society to a heightened state of military readiness" at the expense of its people's social and economic needs. He said North Korea has deployed rocket launchers and artillery to sites close the demilitarized zone that borders South Korea.

The appearance of the Director of Central Intelligence has become a new tradition in Washington, a practice peculiar to the post-cold war atmosphere of openness, in which he testifies publicly, albeit circumspectly, and takes questions before his Congressional overseers. In exchange, his concerns about national security matters, including the threat of deeper intelligence budget cuts, become the subject of public debate.

Appearing with Mr. Woolsey, the director of the Defense Intelligence Agency, Lieut. Gen. James R. Clapper Jr. of the Air Force called North Korea "the critical major military threat for the next few years." The general said North Korea was only one among several post-cold war nations where military intelligence officers are confronted with "mysteries--things that are not predictable, not even knowable."

Sounding a grim note on the subject of the spread of weaponry, Mr. Woolsey said that in the 21st century chemical and biological weapons may pose the kind of threat that nuclear weapons once did. An estimated 25 countries, some hostile to the United States, are trying to build nuclear, chemical or biological weapons, he said.

Iran, Mr. Woolsey said, continues its "ambitious multibillion-dollar military modernization program" and seeks to buy nuclear material and ballistic missiles. North Korea continues to export missiles with a range of 625 miles or more, posing a potential threat to the Middle East. Tracking the intricate underground networks of buyers and suppliers of weapons matêriel is a daunting task, he said.

(text of January 26, 1994 New York Times article)


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