CURRENT INTELLIGENCE BULLETIN - 1958/01/11

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03015193
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 16
• Document Creation Date: January 27, 2020
• Document Release Date: January 30, 2020
• Publication Date: January 11, 1958

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/ CURRENT
/ INTELLIGENCE
BULLETIN
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2019/08/20 030151,7/ d/M
3.3(h)(2)
3.5(c)
11 January 1958
/ TOP SECRET
Copy No. 143
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NEX DATE:
ALITH: �I O2
DATE.
REVIEWER
OFFICE OF CURRENT INTELLIGENCE
CENTRAL INTELLIGENCE AGENCY
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CONTENTS
1. USSR HOPES SUMMIT PROPOSAL WILL TEST NATO UNITY
(page 3).
THE SITUATION IN INDONESIA
(page 4).
RIFT IN CHINESE N7IONALIST GOVERNMENT
(page 5).
JORDANIAN BEDOUIN OFFICERS MAY BE PLOTTING
AGAINST PREMIER (page 6).
YEMEN SEEKING NEW SOVIET LOAN FOR MILITARY
EQUIPMENT (page 7).
TUNISIAN-FRENCH TALKS ENCOUNTERING DIFFICULTIES
(page 8).
INDIA RE-EMPHASIZES POSITION ON KASHMIR DISPUTE
(page 9).
BURMA TO OBTAIN ECONOMIC AID FROM BLOC
(page 10).
90 PRESIDENT RHEE APPROVES ARREST OF OPPOSITION
LEADER CHO PONG-AM (page 11)0
10. SHAKE-UP IN VENEZUELAN CABINET (page 12).
11.
BONN TAKES STRONG ANTI-SOVIET POSITION
(page 13).
12. DUTCH POLICY TOWARD INDONESIA
11 Jan 58
(page 14).
Current intelligence Bulletin Page 2
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1. USSR HOPES SUMMIT PROPOSAL WILL TEST
NATO UNITY
Comment on:
Private statements by Soviet officials,
as well as Premier Bulganin's new
letters, reflect Moscow's increasing
confidence that West European pres-
sures for new East-West negotiations will either force
eventual American agreement to a heads-of-government
meeting or encourage its NATO allies to make independ-
ent moves toward an accommodation with the USSR.
Moscow's repeated rejection of the
NATO proposal for a foreign ministers' conference, which
Bulganin said would only create "additional obstacles" to
agreement, indicates that the Soviet Union believes it can
rebuff Western offers without jeopardizing its posture of
seeking an East-West settlement. Soviet Ambassador Malik
told Foreign Minister Selwyn Lloyd privately on 7 January
that instead of a foreign ministers' meeting, the USSR pre-
ferred either a summit conference, a special UN General
Assembly session, or a world disarmament conference.
The Soviet Union's vigorous efforts to
create the appearance of a serious desire for top-level
negotiations have been accompanied by signs that the So-
viet leaders would like to undertake new visits to free
world countries. Norway has reported renewed feelers
from Moscow for a trip by Khrushchev and Bulganin to
Oslo, and there are unconfirmed reports that they will
visit Iran in March and Egypt sometime this year. Recent
pronouncements by the Soviet leaders and notes to free
world heads of government have stressed the need for high-
level personal contacts.
11 Jan 58
Current Intelligence Bulletin Page 3
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2. THE SITUATION IN INDONESIA
Comment on:
he possible establishment of an inde-
endent regime in Sumatra is receiving
ide publicity, both in Holland and
donesia. Detailed Dutch press re-
orts state that Indonesia's dissident
olonels who met at Padang, Central
matra, wish to establish a govern-
ent, possibly with Hatta at its head,
o counter that of Djakarta and to corn-
at Communism. Two newspapers in
akarta, one leftist and one Commu-
ist, reported on 9,January that anti-
Communists were planning to establish
a "state of Sumatra," and denounced Masjumi and Socialist
party leaders on the island for supporting these plans.
while the dissidents may be willing to await
Sukarno% return before acting, they are proceeding
with the organization of an "emergency cabinet" to take
office at once if for any reason the Djuanda government is
"unable to continue functioning." both STAN-
VAC and the American Embassy can, in any event, expect
to be increasingly accused by the Communists of support-
ing efforts to overthrow the present government.
Additional evidence of the central gov-
ernment's difficulties with the outer regions is the recent
intensification of dissident activities in East Indonesia. The
self-styled governor of North Celebes recently broke with
the provincial administration in Makassar, stating that he
would henceforth deal only with Djakarta, which he asserted
had already given de facto recognition to his autonomy move
last year. In addition, pro-Djakarta officials in Makassar
are said to be highly disturbed over reports that the South
Celebes commander and Darul Islam leader Muzakkar have
agreed to end fighting between their forces, which may result
in unity of action.
11 Jan 58
Current Intelligence Bulletin Page 4
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3. RIFT IN CHINESE NATIONALIST GOVERNMENT
serious rift between the Control Yuan
d the executive organs of the Chinese
ationalist Government may, if not re-
olved soon, lead to further Control Yuan
ttacks on government officials and possi-
ly to some ministerial shake-ups. The
Control Yuan, the "watchdog" branch of
he government, on 23 December impeached
remier O. K. Yui on charges of derelic-
ion of duty, and on 9 January, in the face
strong official disapproval, voted to con-
inue the investigation.
Chiang Kai-shek, however, has supported
Yui, and, has refused to accept his
resignation. Chiang has assigned
his top Kuomintang party officials the task of settling the rift
with the admonition that unspecified "drastic changes" will be
made if they fail.
In its resolution of 9 January, the Control
Yuan affirmed its intention to continue to investieate Yui's con-
nections with the government Central Bank.
The members of the Control Yuan have long
been frustrated by their lack of authority. Repeated attempts
In the past to impeach officials have failed.
A potentially serious aspect to the crisis is
the demonstrated collapse of Kuomintang party discipline.
Ninety percent of the Control Yuan members belong to the rul-
ing party, but party cells, are no
longer functioning in the Control Yuan. This lack of discipline
also extends to the Legislative Yuan, which has recently opposed
official, policy on several important issues.
11 Jan 58 Current Intelligence Bulletin
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4. JORDANIAN BEDOUIN OFFICERS MAY BE PLOTTING
AGAINST PREMIER
Co m nt on:
A faction of Bedouin officers in the
Jordanian Army is reported involved
n collaboration with members of the
opposition Baath party aimed at replac-
ing unpopular pro-Western Premier Rifai, Interior Min-
ister Madadha, and top military leaders. The group pro-
poses to support Husayni Khalidi, a moderate Palestinian
nationalist, as prime minister, and to replace the army
chief of staff and the deputy chief of staff. An attempt
would be made to normalize relations with Egypt if Nasir
agreed not to undermine King Hussayn and to accept Jor-
dan's independence; normalization of relations with Syria
on similar terms is presumably also envisaged. The group
Is reported to be considering making contact with the Soviet
Union to seek economic aid in an effort to develop leverage
for increased American assistance.
The ultranationalist Baathists� having
failed in a bid to gain control of Jordan in the spring of 1957,
are apparently attempting to exploit political dissatisfaction,
and factional rivalries within the Jordanian Army to work with
the Bedouins, whose military power is King Hussayn's princi-
pal support. If the Baath should succeed in obtaining coopera-
tion from the Bedouins to undermine the present unpopular
government, the party would be in a greatly improved posi-
tion to seek control of Jordan and reduce King Hussayn and
his pro-Western position to impotence. Egyptian agreement
not to undermine Hussayn might be given for tactical reasons
to encourage overthrow of the Rifai government, and would
not bar Nasir's continuing elfort to bring Jordan under Egyp-
tian policy guidance.
11 Jan 58
Current Intelligence Bulletin Page 6
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5. YEMEN SEEKING NEW SOVIET 1.40AN FOR
MILITARY EQUIPMENT
he Imam of Yemen is seeking a new
$20 million loan from the Soviet Union
or jet fighters and other equipment,
The Imam also instructed
Ba,dr to negotiate a long repayment period for Yeman's pre-
vious debt to the Soviet Union. This suggests that some Soviet
aid deliveries and services during the past year may have been
undertaken with the understanding 'that terms would be settled
later.
The Imam also asked Moscow to expedite
roadbuilding equipment and personnel to Yemeni A few days
earlier he had rebuffed an American offer of such assistance.
Be asked Badr to "explain to your friend Khrushchev that we
are sympathetic toward the East," and to play up Yemeni ten-
sion with Britain in the Aden Protectorate.
Yemeni officials had previously told the
Italian charge that Yemen was considering a Soviet offer for
about $35,000,000 worth of economic development projects over
a five-year period. Agreement was expected to be concluded
shortly. The Cairo press reported on 9 January that a Soviet
economic aid specialist will accompany the Soviet ambassador
when he presents his credentials to the Imam in mid-January.
11 Jan 58
Current Intelligence Bulletin, Page 7
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6. TUNISIAN-FRENCH TALKS ENCOUNTERING DIFFICULTIES
Comment on:
Tunisian-French discussions preparatory
to resuming negotiations appear to be
floundering. Tunisian President Bourguiba
continues to insist that all uniformed French
personnel be withdrawn from southern Tunisia before common
defense negotiations can begin. Bourguiba threatens that if
Paris does not agree, he will withdraw his proposal that Bizerte
remain a French base and offer it "to another Western country
or countries." He told the French ambassador that Britain and
the United States would understand his position.
Paris may find it difficult to meet Bour-
guiba's terms inasmuch as other French concessions are de-
pendent on Tunisia's acceptance of French air police at four
airfields in southern Tunisia. The French are particularly
concerned about Bourguiba's conviction that he will have the
understanding and support of London and Washington.
11 Jan 58
Current Intelligence Bulletin Page 8
C.ONPMENTI A
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7. INDIA RE-EMPHASIZES POSITION ON KASHMIR DISPUTE
Comment on:
The Indian Government during the past
ten days has re-emphasized its ada-
mant position in the Kashmir dispute,
possibly to strengthen its bargaining
power in advance of UN representative
Frank Graham's arrival in New Delhi
on 12 January to open a new round of dis-
cussions on the issue.
In recent public statements, Prime Min-
ister Nehru and Defense Minister Krishna Menon have reiterated
in strong terms the Indian stand that there can be no progress
toward a solution of the Kashmir dispute until Pakistan evacu-
ates the sector of Kashmir it has "illegally" occupied since
1947. Krishna Menon on 4 January ruled out any settlement
on the basis of a partition such as along the present cease-
fire line, and warned that the Indian Government was not pre-
pared to hold "secret negotiations" of any kind with Dr. Graham.
Indian leaders previously had indicated
that they were giving some consideration privately to the possi-
bility of a package settlement with Pakistan, in which agreement
on such other major differences as the division of canal waters
would be negotiated along with the Kashmir question.
11 Jan 58
Current Intelligence Bulletin Page 9
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8. BURMA TO OBTAIN ECONOMIC
AID FROM BLOC
Comment on:
The loans obtained by Burmese Deputy
Prime Minister Kyaw Nyein from the
USSR and Communist China during his
recent tour of the bloc are to be used
for projects that appear to be econom-
ically sound and highly desired by the Burmese, according
to the American Embassy in Rangoon.
The USSR has agreed to provide up to
$6,000,000 for the construction of two irrigation dams in
central Burma which had been previously recommended by
a Soviet agricultural team. Negotiations for the financing
of these dams have been under way in Moscow for some
time, but their conclusion was deferred until Kyaw Nyein
arrived.
Communist China has promised a
$7,000,000 loan for the construction of a farm implement
factory and a textile factory. This is the first instance of
Peiping granting a loan to a non-Communist country.
All loans carry a 2.5-percent interest
rate, but vary in longevity. The Burmese will have 12
years to pay for the dams, and five years for the imple-
ment factory; the period of the loan covering the textile
plant has yet to be determined. Burma is to ma.ke repay-
ment in kind, presumably in rice.
11 Jan 58
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9. PRESIDENT RHEE APPROVES ARREST OF OPPOSITION
LEADER CHO PONG-AM
President Rhee's approval on 8 January
of the arrest of Progressive party leader
Cho Pong-am and his principal associates
on charges of "treasonable contacts with
Communists" reflects the President's genuine fear of the left-
ists and at the same time serves as a warning to all anti-Rhee
candidates intending to run in next spring's National Assembly
elections. Security officials consider they have enough "evi-
dence" to convict Cho. The arrests are to be disclosed to the
press on 11 January, and the Progressive party will be pro-
scribed and dissolved.
In the wake of serious factionalism within
the major opposition Democratic party, Cho's arrest would
considerably improve the election prospects of the hard-
pressed pro-Ethee Liberals.
Cho's Socialist party has been a major
target of police harassment since its organization last April,
and reports that he would be arrested have circulated since
last fall's roundup of alleged leftist "subversives." A former
Communist, Cho alone among South Korean politicians has
urged unification negotiations with the north. His reported
following among students and young army officers is difficult
to gauge, but he polled over 2,000,000 votes against about
5,000,000 for Rhee in the 1956 presidential election and had
been considered assured of election to the assembly this spring.
11 Jan 58
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10. SHAKE-UP IN VENEZUELAN CABINET
he Venezuelan cabinet resigned at
idnight on 9 January at the request
f President Perez, who probably
cted under strong military pressure0
arlier in the day, the government was
aid to have quelled an uprising among
nits of the navy, the only component of
the armed forces not implicated in the
1-2 January revolt. The cabinet resignations suggest that
Perez may be replaced shortly by a military junta, possibly
with civilian elements. According to press reports, a new
cabinet, formed on 10 January, has a majority of military
officers.
The breakdown in Perez' one-man rule
may touch off an extended period of instability, in which loni-
suppressed civilian groups compete with the armed forces
for dominance of the government. The military leaders may
therefore retain Perez at least temporarily as a symbol of
their unity and to prevent widespread violente in reaction to
several years of Perez' authoritarian control. A large-scale
demonstration was held in Caracas on 10 January calling for
an end to the dictatorship.
The government has moved to heal the
widening breach with the Catholic Church by releasing six
priests from prison.
11 Jan 58
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11. BONN TAKES STRONG ANTI-SOVIET POSITION
The press chief of the West German
Government,stated on 10 January that
the 9 January Bulganin notes possibly
mean the "end of Western efforts to
come to terms with the Soviet Union:'
His remarks apparently reflect a basic
policy line taken by Chancellor Adenauer
at his 8 January cabinet meeting as reported by an untested
but well-placed source. Chancellor Adenauer, in reporting
on the recent NATO conference, emphatically reassured the
cabinet that his foreign policy had not changed "one iota,"
and that he would soon dispel any doubts by issuing a series
of clarifying statements on East-West talks and other contro-
versial issues.
Adenauer was supported unanimously by
the cabinet in rejecting the Rapacki plan. He also bitterly
criticized British foreign policy, describing the Macmillan
nonaggression pact proposal as a "breach of faith," and said
it was increasingly important for Bonn to strengthen Conti-
nental ties, especially with France.
He is reported to have presented a "glow-
ing" account of the NATO meeting, and was especially lauda-
tory of President Eisenhower and Secretary Dulles. He told
the cabinet that if the US feels that tactical atomic weapons
and rocket bases should be stationed in West Germany in or-
der to fulfill NATO commitments, the European allies "must
accept."
11 Jan 58
Current Intelligence Bulletin Page 13
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12. DUTCH POLICY TOWARD INDONESIA
Reference:
After discussions with various Dutch
officials, Ambassador Young at The
Hague has the impression it is virtually
impossible for the present Netherlands
Government to enter negotiations with
Indonesia on the future status of West New Guinea. Although
there has been some criticism of this policy, the vast major-
ity of Dutch opinion holds that the Netherlands should not
"submit to blackmail." Moreover, the present coalition was
constituted on the basis of retention of sovereignty over New
Guinea, and Prime Minister Drees is obstinately opposed to
any revision of this stand.
While Dutch enterprises have been mark-
ing time concerning their future in Indonesia, indications are
that all except those which can demonstrate international own-
ership will leave "lock, stock, and barrel" if no political
changes occur during the absence of President Sukarno. One
factor in such a decision would be anticipation of civil disor-
ders growing out of the food crisis.
Once Dutch interests have decided to with-
draw, they may be more amenable to suggestions that non-
Communist nations should attempt to fill the resulting vacuum.
Ambassador Young believes that the Dutch Foreign Ministry
already considers this to be in the Netherlands' own interest.
11 Jan 58
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CORRECTION TO ITEM 7, PAGE 9, CURRENT INTELLIGENCE
BULLETIN DATED 9 JANUARY 1958
The first sentence should read: "A close contest is expected
in the Naha, Okinawa, mayoral election on 12 January."
11 Jan 58
Current Intelligence Bulletin Page 15
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