CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A000400230001-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 23, 2016
• Document Release Date: May 22, 2012
• Sequence Number: 1
• Publication Date: March 17, 1955
• Content Type: SUMMARY

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CONFIDENTIAL
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CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 12
OCR NO.2373/55
17 March 1955
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
DOCUMENT NO. ~~--.
NO CHANGE IN CLASS. 0
U DECLASSIFIED
CLASS. CHANGED TO:
NEXT REVIEW DATE:
7 -2
AUTH:
.
DATE y~`~ $-+ REVIEWER:.
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THIS MATERIAL CONTAINS INFORMATION AFFECT-
ING THE NATIONAL DEFENSE OF THE UNITED STATES
WITHIN THE MEANING OF THE ESPIONAGE LAWS,
TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS-
SION OR REVELATION OF WHICH IN ANY MANNER TO
AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
The Current Intelligence Weekly Summary has been prepared
primarily for the internal use of the Central Intelligence
Agency. It does not represent a complete coverage of all
current situations. Comments and conclusions represent
the immediate appraisal of the Office of Current Intelligence.
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UUIYI IVLI~ I iUL .,.r r+.r
CHANCES FOR RATIFICATION
OF PARIS ACCORDS IMPROVE . . . . . . . . . . . . . . . . . Page 1
Prospects for approval of the Paris agreements in
the French Council of the Republic have improved over
the last week, but council endorsement is still not as-
sured. The German Bundesrat is not expected to exer-
cise its suspensive veto when the agreements come up
for consideration on 18 March. (Secret)
CHINESE COMMUNISTS CONTINUE
MILITARY PREPARATIONS . . . . . . . . . . . . . . . . . . Page i
The Chinese Communists are still improving offen-
sive and defensive positions near the Matsus and
Quemoys. (Secret Noforn)
USSR SHIFTS POSITION
ON DISARMAMENT . . . . . . . . . . . . . . . . . . . . . . Page 2
Soviet tactics at the disarmament talks in London
shifted on 11 March, when Gromyko dropped his demand
for a ban on nuclear weapons as a "first step" and sug-
gested that the subcommittee discuss the more concilia-
tory Soviet proposal of 30 September 1954. The move
appeared to be aimed particularly at impressing the
French delegate. (Secret)
Molotov's Status: Foreign Minister Molotov appears to
have suffered a loss of prestige and influence
during recent months, but he is apparently not in
serious political danger. (Secret Noforn). . . . . . Page 1
CO~TIAL
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tol&Wl .We low
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
Soviet-Yugoslav Relations: The recent Moscow-Belgrade
propaganda exchange shows that the Soviet Union in-
tends to continue "normalization" but still does
not intend to take public blame for the 1948 break,
as the Yugoslavs want it to do. (Confidential) . . . Page 2
Developments in Hungary: A trend already appears to be
developing in Hungary to carry to extremes the tac-
tical changes in policy which the party central
committee recently approved. Rakosi seems to be
aware, however, that such extremism is likely to
cause an increase in popular disaffection.
E . . . . . . . . . . . . . . . . . . . . Page 2
Promotions of Soviet Officers: Recent promotions of
Soviet officers to the rank of marshal are a re-
flection of increasing prestige for the military
leadership and conform with current Soviet empha-
sis on military preparedness. . . . Page 3 25X1
Japan-Orbit Relations: The selection of Arata Sugihara,
a oyama s personal adviser on foreign affairs, to
head the Japanese delegation at the forthcoming
Japan-USSR talks in New York may seriously weaken
Japan's bargaining position. Sugihara advocates
the immediate establishment of diplomatic rela-
tions, leaving controversial issues to be settled
later by treaty. . . . . . . . . . . Page 5
South Korea Threatens to Act Against Truce Inspectors:
The South Korean government as threatened to act
against Polish and Czech truce inspectors within
its borders if the current diplomatic exchanges
on the status of the Neutral Nations Supervisory
Commission fail to terminate the commission's
activities or at least remove Communist inspectors
Page
from South Korea.
The Associated States: Vietnam: Political maneuvering
by the sects against em has reached a new high.
The sects continue to hope that Bao Dai will save
them by returning to Vietnam and sweeping Diem
aside. Cambodia: Cambodia's decision to hold
elections in September rather than April confronts
the truce commission with the necessity of choosing
between giving up its plan to supervise the elec-
tions or prolonging its activities for several
months. Laos: A continued effort on the part of
the government to "win over" the Pathet Lao is
indicated by its agreement to a cease-fire.
. . . . . . . . . . . . . . . . . . Page a
,.jgy00-
THE WEEK IN BRIEF
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
The Afro-Asian Conference: The issue of coexistence may
stir er debate and divide the sponsoring powers
at the Afro-Asian conference; meanwhile, the Commu-
nists continue their elaborate preparations for the
conference. (Secret) . . . . . . . . . . . . . . . . Page 8
Food Problems in South Asia: Subnormal winter rainfall
will probably result in lower food grain production
during 1955 than in the excellent crop years of
1953 and 1954 in most countries along the southern
periphery of Asia, from Afghanistan to Indochina.
(Secret) . . . . . . . . . . . . . . . . . . . . . . Page 8
Arab-Israeli Border Tension: Tension on the Arab-
Israeli borders continues high, but the beginning
on 17 March of UN discussion of the Gaza incident
has resulted in some relaxation. Troop movements
have continued on both the Egyptian and Israeli
sides, but they appear to be precautionary measures
rather than preparations for large-scale hostilities.
(Secret) . . . . . . . . . . . . . . . . . . . .... Page 9
Iraq and Egypt Struggle for Control of Syria: Iraq and
Egypt, engaged in a struggle for the domination of
Syria, are supporting rival Syrian factions. The
conflict may be brought to a head if Egypt makes a
strong bid for Syrian-signature and ratification
of its new anti-Iraqi defense pact. (Secret Noforn). Page 10
US-Portuguese Air Base Talks: Lisbon has already indi-
cated will drive a hard bargain in the current
negotiations for American air base rights on Sal
Island in the Cape Verde group. These discussions
may foreshadow additional difficulties in the forth-
coming negotiations for a renewal of the Azores base
agreement of 1951. (Secret) . . . . . . . . . . . . Page 10
25X1 Page 11
Strikes Expected to Paralyze Icelandic Economy: The
strike of major Icelandic unions, scheduled for
18 March, will paralyze Reykjavik, the economic hub
of the country. American defense officials in Ice-
land-expect a prolonged work stoppage and have re-
quested an airlift of essential supplies.
(Secret Noforn) . . . . . . . . . . . . . . . . . . . Page 12
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
Instability in Chile: Chile's critical political and
economic situation ion is underlined by recent reports
of increased army concern over the instability of
the government. (Secret) . . . . . . . . . . . . Page 12
PATTERNS AND PERSPECTIVES
JAPANESE ATTITUDES TOWARD REARMAMENT . . . . . . . . . . . Page 1
Japan's new leaders have made it abundantly clear
that butter has priority over guns in their plans for
the coming year. They insist that any increase in mil-
itary spending would either lead to inflation or cause
the abandonment of the Hatoyama program for tax reduc-
tions and social welfare projects. (Secret)
SOVIET ORBIT ACTIVITIES IN LATIN AMERICA . . . . . . . . Page 3
The past two years have seen a. marked increase in
Soviet and Satellite activity in Latin America--among
other things, an expansion of Orbit diplomatic missions,
a moderately successful trade offensive, and a strong
cultural offensive. These Orbit activities, although
handicapped by the anti-Communist, pro-American orien-
tation of Latin American governments, are aided by eco-
nomic difficulties and apathy toward local Communists.
(Secret)
SECRET
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
OF IMMEDIATE INTEREST
CHANCES FOR RATIFICATION OF
PARIS ACCORDS IMPROVE
Prospects for approval of
the Paris agreements in the
French Council of the Republic
have improved during the past
week, but council endorsement
is still not assured.
Premier Faure and Foreign
Minister Pinay are reported to
have made favorable impressions
in their defense of the agree-
ments before the council's
Foreign Affairs Committee.
This key committee voted out a
report on 16 March approving
the agreements.
The touchy Saar issue seems
to have been sidetracked, and
the arms production pool ques-
tion continues to be only po-
tential troublesome.
Both Faure and Pinay ex-
pect the cabinet to maintain a
facade of solidarity in support
of the accords.
Minister of State Palewski,
on the other hand, is still
intent on obtaining council
support for four-power talks,
and a spectacular Soviet move
on East-West talks or disarma-
ment, or even a well-publicized
move by General de Gaulle,
could give Palewski the lever-
age he needs to try to throw
council opinion against uncon-
ditional approval of the agree-
ments. This is particularly
the case in view of the reluc-
tance of senators to vote for
German rearmament just before
the cantonal and council elec-
tions in April and June.
The German Bundesrat is
not expected to exercise its
suspensive veto against the
Paris accords when they come up
for consideration on 18 March.
While the opposition So-
cial Democrats have reportedly
secured sufficient support from
dissident coalition deputies to
bring the Paris accords before
the Constitutional Court, gov-
ernment legal experts are con-
fident that the court will not
delay final approval or deposit
of the accords. (SECRET)
CHINESE COMMUNISTS CONTINUE
MILITARY PREPARATIONS
The Chinese Communists are
still improving offensive and
defensive positions near the
Matsus and Quemoys, but they
have not yet undertaken any
serious move against islands
in either group.
There are indications that
the Communists have recently
increased their naval strength
in the Foochow area, opposite
the Matsus. An LST and several
torpedo boats have been re-
ported there recently.
Chinese Communist planes
have not yet appeared over the
Matsus or Quemoys.
SECRET
PART I OF IMMEDIATE INTEREST Page 1 of 3
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SECRET NeW 14W
Contrary to previous re-
ports, however, air photos and.
current reconnaissance indicate
that the Chinese
Communists have not
begun readying any
of the airfields in
Fukien Province, op-
posite the offshore
islands and Formosa,
There has been
no change in the
Communist position
on a cease-fire in
the China area--
namely, that Peiping
will not recognize
the "two Chinas
concept in any way.
The Soviet and
Chinese Communist
press, commenting on
recent speeches by
Secretaries Eden and
Dulles, have noted
with approval Eden's
call for a National-
ist withdrawal from
the offshore islands
but have denounced
Eden for not opposing
American "occupation"
of Formosa and for
suggesting Nationalist repre-
sentation in any international
conference. (SECRET NOFORN)
USSR SHIFTS POSITION
ON DISARMAMENT
Soviet tactics at the
disarmament talks in London
shifted on 1.1 March, when
Gromyko gave up his demand for
a ban on nuclear weapons as a
"first step" and suggested
that the subcommittee discuss
the Soviet proposal of 30 Sep-
tember 1954.
This proposal accepts the
American-endorsed Anglo-French
memorandum of last June as a
basis for discussion and pro-
vides for a phased disarmamen-
program before the actual de-
struction of atomic stockpile:;
SECRET
PART T OF TMMFT)TATR TTITFRF.RT Pa r 9. of 'I
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SECRET `"* rr
Gromyko's maneuver appears
to have a direct connection
with Moscow's campaign against
the ratification of the Paris
agreements--coming as it did
.in response to a strong attack
by French delegate Moch on
Gromyko's earlier extreme po-
sition. Moscow is aware that
Moch, in his desire to prevent
German rearmament, has been im-
pressed by previous Soviet ma-
neuvers on the disarmament
question.
At any rate, the new move
will keep the disarmament talks
going, and will thus offer
Gromyko additional opportunities
for attempting to separate the
French from the United States
and Britain.
The Soviet Union has also
been promoting its position on
"atoms- for- peace" and attacking
President Eisenhower's UN-
endorsed atomic pool plan in
attempts to divert attention
from its basically unrco-
operative stand at the London
talks.
Pravda on 13 March de-
nounced the President's offer
of December 1953 as "osten-
tatious propaganda" and again
insisted that all nuclear
materials--instead of the
"small part" provided for in
the President's plan--should
be used for peaceful purposes.
(SECRET)
SECRET
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
PART II
NOTES AND COMMENTS
Foreign Minister Molotov
appears to have suffered a loss
of prestige and influence
during recent months, but is
apparently not in serious
political danger.
The American embassy in
Moscow interprets the Soviet
publication of Marshal Tito's
recent remarks criticizing
Molotov as a slap at Molotov
and possibly as a warning to
him against opposing the for-
eign policy views of the
Khrushchev-Bulganin leadership.
There have been other signs
during the past six months that
Molotov's political prestige
has been deteriorating.
He was not included in the
delegation, headed by Khrushchev,
and including Bulga.niu and
Mikoyan, which undertook the
highly publicized diplomatic
mission to Peiping last fall.
Ambassador Bohlen noted
that Molotov seemed extremely
subdued and ill at ease at a
reception in Moscow in Novem-
ber, and conjectured that his
conduct of foreign affairs had
been criticized by his asso-
ciates on the party presidium.
At a diplomatic reception
in December, Molotov was de-
scribed as "sullen" and
"glacial" throughout a dis-
cussion of Soviet foreign pol-
icy. At that time, Ambassador
Bohlen expressed the opinion
that there was probably a dif-
ference of views within the
Soviet leadership as to how the
USSR should react to final rat-
ification of the Paris agree-
ments.
Bu ganin s unusual offer
to receive the heads of dip-
lomatic missions in Moscow can
be regarded as a snub to
Molotov. They also noted that
a speech delivered by Molotov
in mid-February was not pub-
lished in. the Soviet press.
Although these facts
appear to be insignificant
individually, cumulatively they
suggest a gradual loss of po-
litical prestige.
The evidence does; not ap-
pear, however, to be sufficient
to justify a conclusion that
Molotov is likely to be de-
moted or suffer political
eclipse.
Molotov, the oldest of the
Old Bolsheviks, has survived
many political changes in: the
course of his long career, al-
ways conforming to the prevail-
ing party line.
He is probably less sub-
ject.,to the pressures of polit-
ical leadership rivalries than
most of his colleagues since
he seems never to have been a
strong contender for the top
place in the Soviet hierarchy.
In recent years he has con-
fined his activities largely to
the foreign affairs field.
Molotov has thus acquired
unique experience and skills
which are useful'to the present
leadership in an area of gov-
ernment that does not permit
him seriously to threaten the
position of the more powerful
Soviet leaders. (SECRET NOFORN)
SECRET
PART II NOTES AND COMMENTS Paan 1 of 1
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
Soviet-Yugoslav Relations
The recent Moscow-
Belgrade propaganda exchange
shows that the Soviet Union
intends to continue "normali-
zation" but still does not
intend to take public blame
for the 1948 break, as the
Yugoslavs want it to do.
After printing excerpts
from Marshal Tito's recent
speech in its 10 March edition,
Pravda commented on the speech
on 12 March in such a way as
to reaffirm to the Yugoslavs
that the USSR desires to con-
tinue to improve relations.
At the same time, the
article supported Molotov's
hint that Yugoslavia would have
to take the initiative.
This may be interpreted
in Belgrade as indicating a
Soviet belief that few further
concrete actions can be taken
to "normalize" relations,
Relations have been nor-
malized to some extent in
practically all governmental,
economic, and cultural areas.
Further major progress could
Developments in Hungary
Hungarian party leaders
and newspapers have been zeal-
ously attacking Premier Nagy
since the publication on 8
March of the central committee
resolution reprimanding him.
The attacks by some of the
leaders who strongly supported
Nagy's liberal views at the
central committee meeting last
October have already exceeded
the terms of the resolution, in
which Nagy was accused of lead-
ing a "rightist anti-Marxist
only come through the re-estab-
lishment of liaison between the
Soviet and Yugoslav Communist
Parties or through a reduction
of Yugoslavia's security ties
with the West.
Belgrade has apparently
refused to make any such con-
cessions.
Pravda's discussion also
clearly s owed that the Soviet
Union does not intend to take
public blame for the 1948 break.
Yugoslav leaders consider such
a confession a minimum pre-
requisite to major new moves
toward friendly relations with
the USSR.
Pravda's position will
undoub wily further disabuse
them of their belief that the
Soviet Union is undergoing
changes in its basic character.
The only concession in this
matter was Pravda's explicit
denial of any Soviet intention
to attribute "normalizat F-,n"
to a Yugoslav change of heart.
(CONFIDENTIAL)
deviation" which distorted the
new course.
These developments suggest
that the Hungarian regime will
carry to extremes the tactical
changes in policy outlined in
the resolution and will adopt
drastic measures in an effort
to strengthen party control
over the population.
When leaders on the second
level of authority adopt such
measures in attempting to meet
SECRET
PART II NOTES AND COMMENTS
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... SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
the central committee's demands,
popular disaffection is likely
to increase and resistance may
become more widespread, though
it will almost certainly re-
main passive and unorganized.
Party leader Rakosi re-
vealed concern over this pos-
sibility in a speech before
the Budapest party committee
on 12 March in which he stres-
sed the party's adherence to
the basic tenets of the new
course. He emphasized particu-
larly that the party supported
independent peasant production
and adhered to the principles
of voluntary collectivization,
collective leadership and the
Patriotic People's Front.
Rakosi seconded a state-
ment by Budapest party leader
Kovacs on. the need to prevent
left-wing extremism from en-
dangering policy while the party
Promotions of Soviet Officers
A further increase in the
prestige of the military leader-
ship in the USSR is reflected
in the promotion, announced on
11 March, of six officers to
the rank of marshal of the
Soviet Union and of five to the
rank of chief marshal or marshal
of a special arm or service.
The promotions, published
shortly after the major govern-
ment changes in February, are
in conformity with current
Soviet emphasis on military
preparedness.
Except for Biryuzov, who
was a staff officer, the new
marshals of the Soviet Union
were outstanding combat com-
manders of World War II.
The American embassy in
Moscow believes the promotions
was occupied with routing
rightist opportunism.
may be related to the plan to
create an East European unified
command, since four of the six
new marshals of the Soviet
Union occupy key posts in the
western USSR or in occupied.
Europe, while a fifth recently
held such a,post.
The appointment of six new
marshals of the Soviet Union is
the largest simultaneous pro-
motion ever made in the USSR
to this highest military rank.
There are now 17 marshals of
the Soviet Union.
Appointment of additional
marshals may have been overdue.
Since the war, only four offi-
cers had been elevated to the
rank of marshal.
The careers of at least
some of the officers promoted
SECRET
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
Name Age
BAGRAMYAN, I. Kh. 55
BIRYUZOV, S. S, 51
CHUIKOV, V. I. 55
GRECHKO, A. A. 55
MOSKALENKO, K. S. 55
YEREMENKO, A. I. 63
SOKOLOVSKY, V. D. 58
MERETSKOV, K. A. 58
KONEV, I. S. 58
VASILEVSKY, A. M. 57
ZHUKOV, G. K. 58
TIMOSHENKO, S. K. 60
VOROSHILOV, K. Ye. 64
BUDENNY, S. M. 62
Date of Rank Present Assignment
Mar 55 Commander, Baltic Mil.Dist
Mar 55 Assignment unknown
Mar 55 Commander, Kiev Mi1,Dist.
Mar 55 Commander, Group of Soviet
Forces, Germany
Mar 55 Commander, Moscow Mil. Dist.
Mar 55 Commander, North Caucasus
Mil. Dist.
Nov 47 Chairman, Council of
Ministers
June 46 Chief of General Staff
Oct 44 Commander, White Sea
Mil. Dist
Sept 44 Commander, Far East
Mil. Dist.
June 44 Assignment unknown
Feb 44 Commander, Carpathian
Mil. Dist.
Feb 43 First Deputy Defense
Minister
Jan 43 Minister of Defense
May 40 Commander, Belorussian
Mil. Dist.
Chairman, Presidium of
Supreme Soviet
In addition to the above, Marshal of the Soviet Union
K. K. Rokossovsky, age 59, date of rank June 1944, is now Marshal
of Poland and Polish Defense Minister.
Zhigarev, were among
those officers who
received promotions
in the summer of. 1953.
Moskalenko be-
came commander of the
Moscow Military Dis-
trict at the time of
Beria's arrest and
was one of the two
military members of
the court which sen-
tenced him; Grechko
assumed command of
Soviet forces in Ger-
many in June 1953;
Biryuzov took over
Soviet forces in Aus-
tria in July 1953,
but was recalled to
Moscow a year later
for an unknown as-
signment.
Grechko and
Moskalenko were asso-
ciated with Khrushchev
in the Ukraine during
the postwar period-
and, unlike most other
military figures, have
been active in party
affairs.
The three air
officers included in
suggest that their advancement
is party due to their politi-
cal associations. Three of the
new marshals of the Soviet
Union who held positions of
lesser responsibility during
World War II have advanced un-
usually rapidly since the death
of Stalin.
These officers--Moskalenko,
Grechko, and Biryuzov--were
given new assignments shortly
after Stalin's death and, with
the promotion list
are experienced primarily in
tactical aviation. No officers
associated with the Long Range
Air Force are reported to have
been promoted to high rank in
recent years.
The Soviet air forces are
still notably underrepresented
in the higher military ranks in
comparison with ground forces,
despite the promotion of the
three air officers. (CONFI-
DENTIAL)
SECRET
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
Japan-Orbit Relations
The selection of Arata
Sugihara, Hatoyama's personal
adviser on foreign affairs, to
head the Japanese delegation
at the forthcoming Japan-USSR.
talks in New York may serious-
ly weaken Japan's bargaining
position.
Sugihara advocates the
immediate establishment of dip-
lomatic relations, leaving con-
troversial issues to be settled
later by treaty.
He is representative of
an increasingly influential
group of extreme nationalist
elements who view relations
with the Orbit as a prerequi-
site to Japan's "complete in-
dependence" from the United
States.
Sugihara is an."old China
hand," having served there in
diplomatic posts from 1930 un-
til shortly before the end of
the war, when he was picked to
.head the Foreign Ministry's
China Affairs Bureau. There
South Korea Threatens to Act
Against Truce Inspectors
The South Korean govern-
ment has threatened to act
against Polish and Czech truce
inspectors within its borders
if the current diplomatic ex-
appears to be little doubt
that he regards normalization
of relations with the USSR as
merely the necessary forerunner
to diplomatic negotiations with
Peiping and is prepared to pay
a large price for it, if neces-
Foreign Minister Mamoru
Shigemitsu now seems assured
of retaining his post. While
the foreign minister has been
a restraining influence in the
government's dealings with the
Orbit, it is doubtful if he
will be able to wield much in-
fluence over Sugihara.
The Japanese are becoming
concerned over the failure of
the USSR to reply to their
note of 23 February restating
their desire to hold negotia-
tions in New York. There has
been some speculation that
Moscow may be deliberately de-
laying action in order to give
substance to the Socialists'
charge that the Hatoyama gov-
ernment is unable to carry out
its promises to normalize Ja-
pan's relations with the Orbit.
The USSR is committed to
negotiations, however, and its
delay, if deliberate, may be
due to a desire to divorce
these negotiations from the
San Francisco treaty. Under
the provisions of the latter,
Japan is committed until 28
April to extend a treaty on
virtually the same terms to
any of the nonsignatory nations.
(SECRET)
changes on the status of the
Neutral Nations Supervisory
Commission (NNSC) fail to ter-
minate the commission's activ-
ies or at least remove
SECRET
PART I I NOTES AND COMMENTS na cr~ c _-P , n
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woo
SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
Communist inspectors from South
Korea.
In January, the Swiss and
Swedish governments, whose rep-
resentatives along with those
of Czechoslovakia and Poland
comprise the NNSC, requested
both sides in the Korean armi-
stice to consider terminating
or reducing the commission's
activities.
The Chinese Communists
ruled out termination, as de-
sired by the United States, and
consented only to negotiations
within the NNSC for a. reduction
in personnel.
In taking this position,
the Communists hoped to fore-
stall the resupplying of the
United Nations forces with
modern equipment, stimulate
friction between the United
States and South Korea, and
force the United States into
unilateral abrogation of the
armistice if it wished to re-
move the teams from South
Korea.
The decision on future
participation in the commis-
sion will be made by the Swiss
and Swedish governments after
they have studied the American
and Chinese Communist positions.
Unofficial reactions thus far
suggest that the Swiss and
Swedes have ruled out aboli-
tion because of the Chinese
Communist attitude, and will
strive to negotiate with the
Czech and Polish representa-
tives for substantial person-
nel reductions, which might
leave some teams in North and
South Korea.
The latest South Korean
threat most likely represents
a renewed attempt to press
the United States into support-
ing Korean objectives, and Rhee
may attempt to exploit the
issue to obtain promises of
increased military and economic
aid. Nevertheless, if negoti-
ations on the Chinese terms
are undertaken in the NNSC,
South Korea may covertly direct
violence against Czech and
Polish inspectors.
Despite the UN command-
er's warnings that he will
take all-measures necessary to
protect members of the inspec-
tion teams, American military
authorities in Korea adknowl-
edge that they cannot abso-
lutely protect the inspectors
because of the attitude of the
Korean authorities and popula-
tion. (SECRET)
Vietnam: Maneuvering by
the sects against Diem has
reached a new high. The sects
continue to hope that Bao Dai
will save them by returning to
'Vietnam and sweeping Diem aside.
The Binh Xuyen is the
closest to Bao Dai of the three
sects. It provides Bao Dai
with funds and Bao Dai has, in
turn, insisted that the Binh
Xuyen retain control of the
Vietnamese police force.
This mutually beneficial
relationship is proving a for-
midable barrier to Diem's
efforts to control his govern-
ment.
The attempt to murder the
governor of South Vietnam on
14 March dramatizes the exist-
ing tension. The identity of
the attackers remains undeter-
mined, but suspicion points to
followers of the Hoa Hao leader
3a Cut, whose armed forces west
SECRET
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SECRET _-rp,
.j"or %tow,
17 March 1955
of Saigon have frequently
clashed with government troops.
Rumors are circulating
that the Binh Xuyen chief, Bay
Vien, and the discredited
former premier, Tran Van Huu,
are plotting an assassination
attempt against Diem.
Cambodia: Cambodia's de-
cision to hold elections in
September rather than April in-
troduces a new complication in
its relations with the truce
commission. The commission be-
lieves that it has a supervi-
sory function in the local elec-
tions. The Cambodian govern-
ment disagrees. Postponement
of the balloting would require
the commission to prolong its
activities five months--or to
give up its plan of supervision.
Sir Anthony Eden's sug-
gestion in late February that
India might take over the
'training of the Cambodian army
has evoked little enthusiasm
in New Delhi. The Indian truce
chairman in Cambodia said that
India might raise the subject
with the Cambodian government
following the elections. In
any case, Nehru opposes India's
helping to pay for the Cam-
bodian army.
Laos: A "cease-fire"
agreed to on 9 March by royal
government and Pathet Lao nego-
tiators, which merely commits
-the respective forces to re-
frain from hostile acts, indi-
cates the government is prepared
to pursue its efforts to "win
over" the Communist-backed
:forces rather than press
military action against them.
The government's agree-
ment to continue in Vientiane
negotiations on the integration
of Pathet Lao adherents into
the national community will
enable the Pathets to stall for
time while continuing to
strengthen their own armed
forces.
The agreement provides
for a "mixed political commit-
tee" of the opposing sides, a
device which the Laotian pre-
mier had previously described
as "dangerous."
Both Peiping and the Viet
Minh have increased their
propaganda attention to Laos
since the Bangkok conference
late last month. Most recently
Peiping radio has broadcast
earlier Burmese press reports
that former Chinese Nationalist
irregulars are operating against
Pathet Lao forces in northern
Laos and has charged that the
United States is directing and
supplying these irregulars.
At the same time, the
Peiping press asserts this
activity "seriously threatens
not only peace in Indochina
but also China's security."
The Viet Minh radio
alleged that some 3,000 Chinese
Nationalist guerrillas had
moved into Laos, most of them
from Burma.
The remaining Chinese
Nationalists in Burma are under
military pressure from govern-
ment forces and some of them
may have actually moved into
The only favorable devel-
opment so far as the royal
government is concerned is a
more objective attitude on the
part of the Indian chairman of
the International Control Com-
mission.
In a resolution condemn-
ing IPathot Lao seizure of a
SECRET
25X1
25X1
........,e, A %1i n^1ISS +vme fla a'a 7 of 1 5
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... SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
government post last January,
he sided with the Canadian
member and for the first time
allowed a vote to be taken in
a case where unanimity was
lacking. His formerly benevo-
lent attitude toward the Pathet
Lao and his passion for unanim-
ity have been important factors
in preventing full exposure of
the Communists' intent.
(SECRET NOFORN)
The issue of coexistence
may stir bitter debate at the
Afro-Asian conference and dis-
appoint those who hope the
meeting will be essentially a
noncontroversial gathering with
little emphasis on ideological
issues.
The Colombo powers them-
selves are divided as to
whether "coexistence" should
he included on the agenda.
India and Burma are in favor,
while Pakistan and Ceylon are
opposed.
Thus the sponsoring
powers will, in all probability,
be divided on the floor of the
conference, as the issue is
bound to be presented for con-
sideration. Once the question
is introduced, moreover, the
debate is likely to be pro-
longed, with sharp cleavages
developing between Communist
and anti-Communist delegates--
to the despair of neutralists.
The Communists are con-
tinuing to make elaborate
preparations for the conference.
The American embassy in
New Delhi believes that the
Soviet Union, which will not
be represented at Bandung,
probably regards the forth-
coming "Asian Conference for
Easing International Tensions"
to meet in New Delhi on 6 April
as a useful forum from which
to express its continued inter-
est in Asian affairs just be-
fore the other meeting con-
venes.
Peiping's high interest
in the Afro-Asian conference
is indicated by reports that
it plans to send a 120-man
delegation to Bandung, despite
the limit of 20 set by the
sponsors.
Although apparently upset
by these reports, the Indone-,
sian official in charge of
planning the conference has
.indicated that additional visas
would be issued to representa-
tives who could prove that
accommodations were available.
This would probably be no
obstacle to the Chinese. He
also indicated that some cou.n-
tries were sending only five
or six delegates, which would
permit some reallocation of
housing. (SECRET)
Food Problems in South Asia
Subnormal winter rainfall
will probably result in lower
food grain production during
1955 than in the excellent
crop years of 1953 and. 1954
in most countries along the
southern periphery of Asia
from Afghanistan to Indochina.
SECRET
DAT?T Ti NnT1c awn rnMMF.ATTR pnap_ R of 13
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
Afghanistan has officially
informed, the United States
that it might soon request
50,000 tons of wheat and flour
in aid. Wheat in West Pakistan
has suffered considerable dam-
age, and crops in East Paki-
stan are only average. A con-
ference was to be held in Ka-
rachi in early March to decide
whether wheat imports would be
needed in 1955.
Rice production in India
is estimated as lower than
last year, and the American em-
bassy in New Delhi reports that
a decline of over-all food pro-
duction in 1954-1955 seems
certain.
Arab-Israeli Border Tension
Tension on the Arab-
Israeli border continues high,
but the beginning on 17 March
of UN discussion of the Gaza
incident has resulted in some
relaxation.
Troop movements have con-
tinued on both the Egyptian
and Israeli sides, but they
appear to be precautionary meas-
ures rather than preparations
for large-scale hostilities.
The principal current
points of irritation are the
Israeli blockade of a Jordanian
village on Mount Scopus near
Jerusalem and Syria's detention
of four Israeli soldiers. Both
of. these problems have been
the subject of arduous and
fruitless negotiations.
Israeli prime minister
Sharett has in effect admitted
to the American and British rep-
resentatives in Tel Aviv that
the Gaza attack was decided on
by the Israeli cabinet. While
the precise factors which
Nepal reportedly is al-
ready suffering an acute rice
shortage. Thailand is antici-
pating a lower rice yield, and
supply shortages in North
Vietnam are critical.
Accordingly, the chroni-
cally deficit areas of South
Asia may again be forced seri-
ously to consider the relation-
ship between food supplies and
growing populations.
In India, particularly,
popular morale may be appre-
ciably lowered, since top gov-
ernment leaders have repeatedly
intimated during the past year
that the country's food prob-
lems had been solved. (SECRET)
motivated Israel to launch the
attack are still unclear, a
major factor may be Israel's
determination to force the UN
and the West to concern them-
selves more seriously with the
Palestine problem.
In the UN Security Coun-
cil, Israel will seek, as it
has on past occasions, to
broaden the discussion beyond
the immediate issue of respon-
sibility for the Gaza attack
into a debate on the whole
problem of Arab-Israeli rela-
tions. The French, in line
with their current tactic of
developing closer relations
with Israel, have indicated
support for this maneuver.
On the basis of previous
action, few new developments
now seem likely to emerge from
the UN discussion. In Pales-
tine the established pattern
of minor incidents punctuated
by major flare-ups will be re-
sumed. (SECRET)
SECRET
PART TT *tnrPr c A T.M nnw...,,~,.....
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~... SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
Iraq and Egypt Struggle
For Control of Syria
Iraq and Egypt, engaged
in a struggle for the domina-
tion of Syria,,are supporting
rival Syrian factions. The
conflict may be brought to a
head if Egypt makes a strong
bid for Syrian signature and
ratification of its new anti-
Iraqi defense pact.
Iraqi officials in Bagh-
dad, Damascus and Beirut have
said that Iraq must "lend all-
out support" to Syrian con-
servatives and perhaps even
"march in" to help them over-
throw the leftist, neutralist
government of Prime Minister
Asali.
Syria's president Atasi is
considering asking Iraq to
send troops to Damascus to
forestall Egyptian efforts to
control Syria militarily.
US-Portuguese Air Base Talks
Lisbon has already indi-
cated it will drive a hard
bargain in the current negotia-
tions for American air base
rights on Sal Island in the
Cape Verde group. These dis-
cussions may foreshadow addi-
tional difficulties in the
forthcoming negotiations for
a renewal of the Azores base
agreement of 1951.
An American air force
installation on Sal could serve
as a link in an alternate
Atlantic route in time of war.
In time of peace, a small
custodial detachment would be
stationed there and would
service occasional transit
flights. No particular diffi-
culty was encountered in
On the Egyptian side,
Prime Minister Nasr told Ambas-
sador Byroade on 10 March that
he is "sure" that the Syrian
army is with him in his
"great effort" to counter
Iraq's designs for union with
Syria. Nasr declared that
"we will have a little Revo-
lutionary Command Council in
Syria if trouble really comes."
However, neither Iraq nor
Egypt seems prepared to move
troops into Syria. Egypt is
probably unable to do so, and
Iraq is reluctant to take a
step which would have severe
repercussions throughout the
area.
Both sides will continue,
nevertheless, to intervene by
diplomacy and subversion in
Syria's affairs. (SECRET
NOFORN)
obtaining Portuguese authoriza-
tion for the surveys conducted
on Sal in 1952 and 1953.
Portuguese defense minister
Santos Costa told American
ambassador Bonbright on 9 March
that while he personally was
well disposed toward granting
the concessions sought, he fore-
saw opposition from General
Cintra, the director of civil
aviation who is responsible for
over-all supervision of Sal
airport. Cintra, he said,
"dislikes the United States."
Portuguese objection to
American use of Sal might arise
not so much from Cintra's sup-
posed anti-Americanism as from
Lisbon's opposition to having
Sal airport used for both civil
SECRET
PART I I NnTRR ANfl ( fMMF.NTR Do crn 7 n of 7 4
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SECRET
and military air service. The
Portuguese commercial airline
has its own program for using
this airport,on the Portugal-
Brazil route.
Negotiations on the
Azores base agreement, which
expires on 31 December 1.956, had
been scheduled to start last
month but have been postponed.
Whenever held, they are likely
to be long and difficult.
The Portuguese have tied
to the Azores issue a request
for enough jet planes to equip
two additional squadrons beyopd
the three called for under the
MDAP program for Portugal.
They are also likely during the
negotiations to press for an
American guarantee of their
holdings on the Indian sub-
continent. (SECRET)
SECRET
DART T T ntnmive A ATT1 nnuutV'r n....,. '11 ...a .,
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
Strikes Expected to Paralyze
Icelandic Economy
The primary effect of the
strike by 13 major Icelandic
trade unions, scheduled to
begin 18 March, will be to
paralyze the docks in Reykjavik,
the major port and economic hub
of Iceland.
There are no immediate
shortages at the American-manned
Keflavik air base, but American
defense officials expect the
strikes to last from 3 to 5
weeks, and have requested an
airlift for essential supplies.
These officials also believe
that sympathetic walkouts at
the airbase are possible two or
three weeks after the initial
work stoppage.
Instability in Chile
SECRET
Although the strike has
been ostensibly called over
employers' refusal to meet
union demands for at least a
40-percent wage increase, the
decision to strike is actually
a victory for the Communist
elements who have been spear-
heading the campaign.
The Communists, who with
left-wing Social Democrats now
control the Icelandic Federa-
tion of Labor, evidently hope
to extend their control over
the entire movement and to use
it eventually for political
purposes. (SECRET NOFORN)
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
The chronic instability in
Chile since Ibanez' inaugura-
tion has given rise to frequent
reports that he would assume
dictatorial control. Ibanez
himself stated last July that
if Congress should refuse his
request for special powers to
combat Chile's economic and
political ills, he would
dissolve it and rule by decree.
He has not carried out
this threat, however, and is
believed still reluctant to
abandon constitutional pro-
cedures. Indeed, his failure
to exercise strong leadership
has been a contributing factor
to the present difficult situa-
tion.
The political situation is
complicated by Ibanez' lack of
majority support in either
SECRET
house of Congress, and policy
differences among administra-
tion supporters. The opposi-
tion is also divided, however,
and no one has been able to
formulate an economic program
acceptable to either house of
Congress.
The problem of inflation
in Chile has become particular-
ly acute since World War II.
The cost-of-living index
(1948 = 100) increased from
63 in 1946 to about 560 in
January 1955.
Chile's spiraling cost
of living is giving the out-
lawed Communist Party, with a
membership of 30,000 to 35,000,
a great propaganda opportunity,
particularly among labor
elements. The Communist daily,
El Siglo, is more widely read
by the working class than any
other newspaper in Chile.
Communist influence in
the armed forces is negligible,
however, and it is believed that
the Communists will not be able
to improve their position signif-
icantly in Chile as a result
of the current political tension.
(SECRET)
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
SOVIET ORBIT ACTIVITIES IN LATIN AMERICA
The past two years have
seen a marked increase in
Soviet and Satellite attention
to Latin America--among other
things an expansion of Orbit
diplomatic missions, a
moderately successful trade
offensive, and a strong
cultural offensive.
Although all Latin Ameri-
can governments remain more or
less anti-Communist and ori-
ented toward the United States,
the Communists are able to ex-
ploit the area's economic
difficulties and a common
belief that Communist activi-
ties represent no immediate
threat.
"Anti-imperialist" propa-
ganda is aided by the fact that
diverse elements, including
non-Communists, see Latin
America as subservient to the
interests of United States
markets, investors, and
international policies,
Missions Enlarged
The USSR, with embassies
in Mexico and Argentina and a
legation in Uruguay, has
approached other countries with
a view to establishing diplo-
matic or commercial relations.
Satellite countries maintain
diplomatic and consular offices
in Brazil, Bolivia, and
Ecuador, as well as in Mexico,
Argentina, and Uruguay.
In the past two years the
number of persons assigned to
the USSR's missions in Latin
America has risen from 73 to
about 140. The Satellite
missions have also increased
in size. The commercial
section alone of the Czech
legation in Buenos Aires now
has a permanent staff of some
14 persons.
Increased Orbit military
interest in Latin America is
suggested by a rise in the
number of Soviet service
attaches, a trend also noted
in Europe and the Middle East.
Since 1953 the number of
Soviet service attaches in
Buenos Aires has been in-
creased from two to four and
in Mexico from four to eight.
In addition to requesting
military information, the
attaches have at times dis-
seminated propaganda. These
activities appear to have been
permitted, though not en-
couraged, by Latin American
governments and accepted by,
most members of the attache
corpse
The current Communist
trade offensive is highlighted
by plans for the Soviet trade
fair scheduled to open in
Buenos Aires in April. This
effort, however, dates back to
the Moscow economic conference
of 1952, which established a
permanent international front
organization for the promotion
of East-West trade. Local
SECRET
PART III DATTT PVQ ANn DF.P DV0TTVR.C, n........ o a
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CURRENT INTELLIGENCE WEEKLY SUMMARY
17 March 1955
branches of this organization
are reported to have been or-
ganized in 15 Western nations,
including five in Latin Amer-
ica: Argentina, Brazil, Chile,
Uruguay, and Mexico.
Concurrent with the
Oribt's adoption of "new course"
trade policies in mid-1953,
trade activities increased.
East Germany concluded its
first trade agreements with
Latin American countries during
1954, and other Satellite
trade activities in the area
were expanded considerably.
Argentina and Uruguay,
both traditionally dependent
on the export of farm surplus-
es, have trade agreements with
the USSR as well as with
Satellite countries. The
Soviet Union was one of
Uruguay's best customers in
1954.
Although both Argentina
and Uruguay have accumulated
heavy credit balances, as a
result of the USSR's failure
to deliver goods--despite its
trade propaganda--these
balances in themselves may
encourage continued trade.
Brazil, which sees Soviet
trade offers as primarily prop-
aganda, has been cautious
about entering into agree-
ments with the USSR, but has
greatly increased its trade
with the Satellites, particu-
larly Czechoslovakia.
Chile, experiencing un-
controlled inflation and
suffering from fluctuations in
the world price of copper, has
been deluged with Communist
trade propaganda and offers to
purchase copper. The Ibanez
government, however, has prom-
ised the United States not to
sell copper to the Orbit.
Mexico has not been par-
ticularly vulnerable to Orbit
trade propaganda, but its
small import trade from the
Orbit may have doubled in 1954.
The over-all effective-
ness of the Communist trade
offensive is indicated by the
trade total of about
$125,000,000 between Latin
America and the Orbit in the
first six months of 1954, as
compared to only about
$70,000,000 in all of 1953.
Incomplete trade
statistics suggest that Latin
American exports to the Orbit
in all of 1954 may have been
five times as great as in
1953, while imports may have
doubled. Trade with the Orbit
remains, however, a very small
percentage of Latin America's
total trade.
Cultural Offensive
The Communist cultural
offensive in Latin America has
been marked by an expansion of
local "cultural" societies.
New Russian centers have re-
cently been formed in Brazil
and Chile, and the number of
provincial branches in other
countries has been increased.
Such centers are now
operating in Argentina in the
cities of Buenos Aires,
Rosario, Mendoza, Cordoba, and
Tucuman; in Brazil, in the
cities of Rio de Janeiro and
Sao Paulo; in Chile, in
Santiago; in Mexico, in
Mexico City, Guadalajara, and
Monterrey.
The Union Eslava in
Uruguay, a Slavic society, is
closely linked with the Soviet
legation in Montevideo and is
also a "cultural" center.
The Satellites have also
increased their cultural
efforts. A committee to
establish a Bolivian-Hungarian
"cultural" center was formed
in October 1954, a Chilean-
Bulgarian institute was formed
in September 1954, and a Czech-
Bolivian "Friendship Center"
in February 1955.
SECRET
PART III PATTERNS AND PERSPECTIVES
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S NIL '"Wor None
These "cultural" organi-
zations are closely associated
with the Soviet and Satellite
diplomatic missions, though
they place emphasis on national
sovereignty, patriotism, and
nationalism. Their chief
functions are the distribution,
translation, and publication
of Communist propaganda
material.
Propaganda Activities
The Soviet and Satellite
missions and international
ORBIT ACTIVITIES AND COMMUNIST STRENGTH
ORBIT ACTIVITIES
USSR Diplomatic Missions
^ USSR Cultural Societies
Satellite Diplomatic Missions
? Satellite Cultural Societies
APPROXIMATE STRENGTH OF
COMMUNISTS AND SUPPORTERS
CM9 ~ENT~A_
19M, l
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. _4W
..- `'' t. u` C1'11 It11L' 1400,
The Soviet embassy in
Mexico City, for example, re-
cently aided in the establish-
ment of a firm for the distri-
bution of Russian films in
Mexico and Central America.
Artkino Pictures of Buenos Aires
also distributes such films,
offering them at rental costs
50 to 60 percent below those of
American films.
Various local bookstores,
publishing houses, and news-
stands assist the Communist
propaganda effort. Ediciones
Pueblos Unidos of Montevideo,
for example, receives up to 500
copies of the Cominform journal
by air. Editorial Popular, a
Mexican publishing house which
prints Communist Party material,
displayed and sold Communist
publications at the recent
Mexico City book fair.
The cultural offensive is
aided by local Communist and
Communist-front organizations,
sometimes supported by agents
or sympathizers from other
Latin American countries.
A "cultural week" confer-
ence was held in San Salvador
from 22 to 27 November 1954,
for example. Organized by
Salvadoran Communists, its fea-
tured visitors included Fran-
cisco Carone, a suspected Com-
munist from Cuba and a highly
effective anti-American propa-
gandist; Maria Fuentes, a Cuban
Communist; and a Mexican left-
ist, Dr. Mario de la Cueva.
Increase in Travel
A striking corollary of
the cultural offensive has been
front organizations indirectly
subsidize propaganda activity
by providing discounts and
special facilities to local
distributors.
the increase in travel between
Latin America and the Orbit,
which reflects the USSR's "open
door" policy toward friendly
delegations begun in 1952. A
total of possibly 1,600 Latin
Americans visited the Orbit in
1953 and 1954, mostly under
Communist auspices.
Complementing this travel
has been that of Soviet dele-
gations to Latin America. In
1954, these included a chess
team, a sharpshooting team,
medical delegations, and the-
atrical artists. Ilya Ehrenburg,
the Soviet author and propagan-
dist, also visited Latin Amer-
ica for the purpose of present-
ing a Stalin Peace Prize to
Pablo Neruda, the Chilean Com-
munist poet.
Results of the Drive
The increased attention of
the USSR and its Satellites to
Latin America has already pro-
duced some concrete results in
the realm of trade relations.
Latin American economic
difficulties provide a favor-
able atmosphere for further
trade overtures and for the
growth of nationalist movements
which link the "solution" of
political and economic problems
to the weakening of United
States influence in the area.
Local Communist organiza-
tions, meanwhile, are showing
increased flexibility in their
efforts to build anti-American
"united national fronts."
These factors, coupled with the
Orbit's propaganda and cultural
campaign, may serve to increase
Orbit influence in Latin
America. (SECRET)
CONFIDENTIAL
PART III PATTERNS AND PERSPECTIVES Page 6 of 6
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