Nicaragua National Guard Continues to Attack Rebels

MANAGUA, Nicaragua--Government forces surrounded the city of Isteli in northern Nicaragua by airlift yesterday to attack the last guerrilla strongholds there.

Rebels have held Isteli since September 9 despite the national guard reports Saturday that it had overpowered sniper positions in the town of 30,000.

Earlier, the guard, Nicaragua's army of 7500, recaptured the towns of Masaya, Leon, Chinandega and Penas Blancas, defeating guerrillas opposed to the authoritarian government of President Anastasio Somoza.

There are no reliable reports on casualties in the fighting which erupted throughout the country September 9, but those who visited the recaptured cities say the toll was high. Residents of the towns reported the national guard was executing people suspected of being snipers.

Red Cross sources in Leon, the nation's second largest city, said they counted 300 dead and about 3000 wounded when allowed back into the city by the national guard.

Travelers from the Isteli area, including some who had flown over the town, said it looked deserted. They reported no movement of civilians or automobiles. A fire burned near the center of town.

Scattered fighting was reported from Chinandega, which the guard wrested from the rebels Sunday. There was some shooting overnight in Managua where businessmen vowed to continue a nationwide strike they called August 25 to pressure Somoza to resign.

Correspondents in southern Nicaragua reported occasional firing near the outpost of Penas Blancas on the Costa Rican border. Guerrillas fought a nine-hour battle with the national guard garrison there Sunday before withdrawing into Costa Rica.

An investigative team from the Organization of American States went to Costa Rica to examine claims that Nicaraguan forces crossed the border last week and fired on Costa Rican civilians.

Somoza said Costa Rica gave shelter to what he called communists trying to overthrow him.

Somoza also said a Venezuelan fighter plane on temporary assignment in Costa Rica supported the rebels in their Sunday foray against Penas Blancas.

In Caracas, Venezuelan President Carlos Andres Perez said Monday the charge is "absolutely false."