CURRENT INTELLIGENCE BULLETIN - 1957/12/21

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03184087
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 12
• Document Creation Date: December 12, 2019
• Document Release Date: December 20, 2019
• Publication Date: December 21, 1957

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CURRENT
INTELLIGENCE
BULLETIN
21 December 1957
Copy No. i3g
:CL!N CLASS.
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(61 'ir-41.--r).
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EVIEWER:
OFFICE OF CURRENT INTELLIGENCE
CENTRAL INTELLIGENCE AGENCY
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1.
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CONTENTS
MOSCOW'S REACTION TO THE NATO CONFERENCE
age 3).
0h2. SITUATION IN INDONESIA
(page 4).
3. MAJOR NEW SOVIET ARMS DELIVERIES TO SYRIA
A0 UNDER WAY (page 5).
th4. SPANISH ARMY REQUESTS US EXPRESSION OF SUPPORT
FOR IFNI OPERATIONS (page 6).
116 5. SPAIN REQUESTS EMERGENCY US ECONOMIC ASSISTANCE
(page 7).
6. SAUDIS DISCUSS MORE ACTIVE DEFENSE OF GULF OF
AQABA AREA (page 8).
0.67. JAPAN SENDING ECONOMIC INVESTIGATION TEAM TO
EGYPT (page 9).
ta 8. CEYLON'S TRADE AND CULTURAL CONTACT! WITH
SINO-SOVIET BLOC CONTINUE TO INCREASE
(page 10).
ARGENTINE STRIKE THREATENED ON 23 AND 24 DECEMBER
(page 11).
21 Dec 57
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1. MOSCOW'S REACTION TO THE NATO CONFERENCE
The Soviet government has announced
that it will make a full statement on the
NATO conference communique during
the current Supreme Soviet session. In
its initial reaction, Moscow has con-
tinued to employ the general themes
used in its massive propaganda cam-
paign before and during the meeting.
TASS describes the NATO communiqu�
as reflecting the deep "contradictions" existing in the alli-
ance, and claims that the meeting held up the specter of a
Soviet threat in order to continue the American arms drive
and the cold war. US policy is portrayed as contrasting
sharply with Western European desires to work for peace.
The "most conspicuous" element in the communiqu�ac-
cording to one widely broadcast Soviet comment, is the "dis-
crepancy" between the decision to set up missile bases in
Europe and the call for further disarmament talks with the
Soviet Union.
Comment The Soviet government can be expected
to maintain its adamant attitude that it
will not participate in further sessions of the UN Disarma-
ment Commission unless that body is "balanced" between
the Western states and the Communist and neutralist powers.
Moscow almost certainly hopes to avoid becoming involved
in further detailed discussions of such facets of disarmament
as control and inspection.
The Kremlin might accept a foreign min-
isters' conference, mainly to set the stage for a heads-of-
governments meeting.
21 Dec 57
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2. SITUATION IN INDONESIA
An Indonesian government decree of
16 December, transfering the manage-
ment of former Dutch estates to senior
Indonesian employees, will undoubtedly
work to the advantage of the Communists
who led the drive in seizing these prop-
erties. CommuniSt leadership of the ma-
jor estate labor union,,the domination of
Indonesia's leading peasant organization,
and the party's victories in the 1957 Javanese elections guaran-
tee the Communists a dominating position in the management
of these estates. They will also exert a major influence in
the national and provincial councils which have been set up
by the government to administer the estates. From an eco-
nomic standpoint, the transfer of management to inexperi-
enced personnel can be expected to disrupt production and
marketing and probably to cause considerable unemployment,
thus further favoring Communist exploitation.
In Djakarta, a non-Communist labor
leader has stated that the local Djakarta army command is
allied with SOBSI, the Communist-dominated labor federa-
tion, and is ignoring efforts of Army Chief of Staff General
Nasution to stall SOBSPs campaign to win control over Dutch
enterprises.
The minister of shipping told parliament
on 20 December that the government would use funds under the
pending $100,000,000 Soviet economic development loan to buy
ships�especially Russian ones--to make up shipping shortages
which are seriously aggravating Indonesia's current food scarci-
ties. The USSR, however, would find it difficult to make ships
available, and would be unlikely to permit the use of these funds
for purchase of shipping outside the bloc.
21 Dec 57
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3. MAJOR NEW SOVIET ARMS DELIVERIES TO
SYRIA UNDER WAY
Comment on:
"Russian ships carrying military
equipment" were preparing to leave the
Black Sea for Latakia suggests that ship-
ment of the arms purchased by Syria under the $25,000,000
arms agreement concluded in August of this year is under way.
Although the cargoes are not identified,
they probably include the squadron of all-weather MIG-17 jet
fighters and an unknown number of IL-28 jet light bombers
which the USSR agreed in September to deliver before the end
of this year.
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NIS
4. SPANISH ARMY REQUESTS US EXPRESSION OF
SUPPORT FOR IFNI OPERATIONS
Comment on:
The Spanish army is pressing for an
official expression of US support in the
Ifni hostilities with Moroccan irregulars,
according to American military advisers
in Madrid who were invited on 17 December to visit Ifni, pre-
sumably to give advice on tactics and equipment utilization.
Spanish officers suggested that the United States acknowledge
officially that Spain had been attacked in Ifni, and expressed
the hope that the United States would also provide additional
equipment for use in the area.
The officers said Spain has sent almost
all its available troops to Ifni, except those supplied with
American equipment. They added that if the situation in Ifni
becomes serious, they will be obliged to use American equip-
ment obtained under the Military Assistance Program.
The Spanish government has so far re-
frained from permitting the army to use its US-supplied equip-
ment in the Ifni hostilities, presumably out of consideration for
American efforts to maintain friendly relations with Morocco.
21 Dec 57
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NIS
5. SPAIN REQUESTS EMERGENCY US
ECONOMIC ASSISTANCE
Comment on:
Spanish Minister of Commerce Ullastres
requested on 19 December that the United
States consider an immediate allocation
to Spain of $30,000,000 from President
Eisenhower's contingency fund. Ullastres claimed that Spain's
gold, dollar, and European currency reserves were virtually
exhausted. He also asked the United States to expedite Export-
Import Bank loans for Spain.
Although Ullastres may have exaggerated
Spain's economic predicament somewhat to dramatize the situa-
tion prior to Franco's talks with Secretary Dulles on 20 Decem-
ber, the burden of costly operations against Moroccan irregu-
lars in Spanish West Africa poses a serious problem. Living
costs in Spain have risen some 25 percent over the past year,
and further inflationary pressures would probably result in
widespread labor unrest.
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6. SAUDIS DISCUSS MORE ACTIVE DEFENSE OF GULF
OF AQABA AREA
Comment on:
Saudi frustration over growing Israeli
use of the Gulf of Aqaba transportation
route has apparently provoked considera-
tion of a more active defense of Saudi air
space against Israeli overflights. The
most recent irritant was the Israeli civil air line's announce-
ment of a special flight to South Africa via the Gulf of Aqaba.
Israeli air and sea reconnaissance of Saudi military posts
along the gulf has also at times violated Saudi territory.
Saudi sensitivity to Israel's increasing use
of the gulf will be intensified by a heavier movement of oil tank-
ers commencing about 23 December, as a consequence of the
recent completion of new petroleum storage facilities and addi-
tional pipeline capacity at Eilat. Despite pleas from some local
commanders for action, the Saudis in the gulf area are believed
still under standing orders not to fire unless fired on. King
Saud, however, feels under continuing pressure to take an un-
compromising stand against Israel's right to use the gulf route
and has repeatedly indicated his desire to have the United States
make some decisive move on the question. The Russians have
encouraged Nasir to exploit the issue by pressing Saud to make
a choice between the "Arab cause" and friendship for the United
States.
21 Dec 57
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Nor' *ftril
7. JAPAN SENDING ECONOMIC INVESTIGATION
TEAM TO EGYPT
Comment on:
Japan has accepted an Egyptian invita-
tion to study possible Japanese partic-
ipation in the Aswan high dam project
and other industrialization programs.
A seven-man mission headed by Tat-
sunosuke Takasaki, former head of the Economic Planning
Board, is expected to leave Tokyo about 3 January. Foreign
Minister Fujiyama has instructed his embassy in Washington
to obtain a copy of the World Bank report on the Aswan dam
for the mission.
An Egyptian mission to Japan which re-
cently returned to Cairo apparently was favorably impressed
by Japanese dams. The Japanese also expect to study the pos-
sibilities of power generation, iron manufacture, and the de-
velopment of oil and chemical industries. Japanese interest
in economic cooperation with Egypt, however, appears to be
limited to technical aid and the supply of heavy industrial
equipment. Tokyo officials have indicated that Japan cannot
extend financial aid, and the roving Japanese ambassador in
the Middle East has concluded that trade with Egypt cannot be
expanded beyond current levels because Egypt has few exports
to offer.
21 Dec 57 Current Intelligence Bulletin
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8. CEYLON'S TRADE AND CULTURAL CONTACTS WITH
SINO-SOVIET BLOC CONTINUE TO INCREASE
Comment on:
Trade between Ceylon and the SoViet
Union may soon be facilitated under
prospective trade and payments and
economic cooperation agreements. A
16-man Soviet trade mission, headed
by the deputy chairman of the State
Committee for External Relations, is
due in Colombo on 24 December. Al-
though the Ceylonese are reported to be impressed by the
relatively high level of the members of the Soviet mission,
the chairman is of a rank normally sent to negotiate such
agreements.
The USSR in the past two years has made
a number of informal offers to expand trade and assist in
Ceylon's economic development program. The only results
have been the visit to Ceylon of four Soviet agricultural ex-
perts and recent Soviet purchases of substantial quantities of
Ceylonese tea. A trade agreement would provide the frame-
work for broader Ceylonese-Soviet economic ties and possibly
additional offers of Soviet aid to Ceylon.
Orbit cultural contacts with Ceylon are
also expected to continue. A 75-mpn opera troupe from Com-
munist China and a 40-man Rumanian "cultural show" are ex-
pected to arrive in early January.
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9. ARGENTINE STRIKE THREATENED ON
23 AND 24 DECEMBER
Comment on:
The threatened strike of progovernment
Buenos Aires commercial workers on
23 and 24 December could be exploited
by Peronista and Communist labor ele-
ments seeking to create unrest during
the period preceding the general elec-
tions on 23 February. The commercial
federation, the largest single union in
Argentina, has given the labor minister
until 21 December to consider its demand for an emergency
wage increase. The government had to suppress attempted
Peronista-Communist general strikes in September and Oc-
tober by stern measures, including imposition of a temporary
state of siege.
The commercial workers are demanding
a continuation of special $9.00 monthly wage supplements due
to expire on 31 December, and an additional $9.00 to meet
increased living costs. The government's policy, while stress-
ing more work for more pay, also emphasizes that wages should
be privately negotiated and not officially decreed. The govern-
ment may covertly condone the strike, not only to avoid decree-
ing admittedly necessary wage increases, but also to bolster
the prestige of the commercial employees' leader in the face
of intensified Peronista-Communist efforts to take over lead-
ership.
There recently has been a revival of ter-
rorism attributed to the followers of Peron. Pre-electoral
strategy is reportedly being discussed by Peron and his chief
cohorts at a meeting which commenced in Caracas on 20 De-
cember.
21 Dec 57
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