CURRENT INTELLIGENCE WEEKLY SUMMARY

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A000600090001-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 33
• Document Creation Date: December 23, 2016
• Document Release Date: June 22, 2012
• Sequence Number: 1
• Publication Date: September 15, 1955
• Content Type: SUMMARY

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CONFIDENTIAL
~T
(CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 355
OCI NO. 7428/55
15 September 1955
AUTH:_ NQ70?
NEXT QATE1
o OECLASSFtEe
CLASS. "NGF-0' "S
25X1
NO CMfA GE IN CLASS. 17
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
CONFIDENTIAL
-1 N Elq6~
immediately ter .j
turrt to ,4l.ui zs CT / ecard6 as
L,6 1 d R,-cord'
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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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CONFIDENTIAL
CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 19,55
T H E W E E K I N B R I E F
SOVIET-WEST GERMAN TALKS . . . . . . .. . . . . . . Page
Both the USSR and the West German government achieved
immediate objectives in the Moscow talks.. Each desired, for
different reasons, to establish diplomatic relations. The
Soviet government regards the establishment of relations as
a major step toward freezing the status quo in Europe without
any concessions on. German unification. Adenauer presumably
regards such relations as a prerogative and possibly as of
special value in exploring the problem of German unity on
a continuing basis with Soviet officials.. The arrangements
for the return of German prisoners will give Adenauer a timely
weapon with which to deal with any criticism
that may arise.
NOTES AND COMMENT'S
Soviet Tactics in UN Disarmament Talks: The main efforts of
Soviet delegate o n ev curing 'fie second week of the UN
Disarmament Subcommittee negotiations were devoted to
probing for possible differences in approach among the
four Western powers. The Soviet representatives' attitude
is still moderate and they have not yet sought to trans-
form the meeting into a cold-war forum.
. Page
American-Chinese Talks: Having taken a'conciliatory attitude
on -he reiease o American prisoners, the Chinese Communists
during the second part of the Geneva talks probably will -
aim toward arranging higher-level negotiations with the
United States on major matters. Page 1 25X1
Soviet-Japanese Negotiations: In the Soviet-Japanese discussions
n n on' a USSR,haS made minor concessions on returning
Japanese prisoners of war and restoring Soviet-held island
territory to Japan. On the third major point at issue,
however, the USSR has continued to argue that navigation in
the Sea.of Japan must be regulated by the riparian powers, a
demand-the Japanese have insisted they cannot accept since
it involves an.international body of water.
C01 I WIDE .ttp-L
. . < . . Page 2 25X1
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15 September 1955
Refugee Influx From East Germany Reaches Two-year Peak: The
esfreto escape military service and depressed economic
conditlons, and rising despair of political reform in East
Germany have brought the number of refugees from East
Germany during recent weeks to the highest point since
June 1953, the month of the anti-Communist riots. During
the week ending 3 September, 4,177 refugees arrived in
West Berlin. Of these, 1,064 were men of military age.
. . . . . Page 4 25X1
Greek and Turkish Governments Move to Ease Tensions: The
passions aroused during and after the London. conference
.on' the' :Cyprus issue. Although a gradual easing of Greek-
Turkish tension is'likely, the unresolved differences
over Cyprus and other issues will continue to make
relations uneasy. Page 5 25X1
French North Africa: Moroccan nationalists are likely to
engage n w espread violence unless Sultan Mohamed ben
Arafa departs in the next few days. His departure, on
the other hand, may set off disorders instigated by the
French settlers who strongly oppose the Faure program.
In Algeria. rebel activities are continuing.
. . _. . . . . . . . Page 6
USSR Presses'Iran to Maintain Neutral Position: In line with
its policy of promoting a neutral pos on on the part
of the Near Eastern states, the Soviet Union in recent
weeks has brought. diplomatic pressure to bear on Iran
to prevent it from joining the Turkish-Iraqi pact.
D . . . . . . . . . Page
Finnish President's Visit to Moscow: President Paasikivi's
pending Visit to Moscow, arranged at Soviet initiative,
has aroused some apprehension in Finnish political and
military circles over the possibility that new commit-
ments to the USSR will be required? The Soviet Union
is.unl3ke1 to ut.stron pressure on Finland at this
time. . . Page
Nepalese Rebel Leader Returns From Communist China: Nepalese
re - e Bader Dr. K. Singh, who-flea to Communist China
7 25X1
8 25X1
after;a coup attempt in January 1952, has now returned to
Nepal and . will almost certainly pla. a ke role in-the
country's politics Page 9 25X1
Egyptian-Israeli-Situation: Egypt and Israel have observed a
strict atom s ce on the Gaza frontier since their accept-
ance 'on4 .September of the cease-fire proposal of UN
supervisor: Burns General Burns, while not optimistic,
still hopes to obtain some agreement from the two countries
on carrying out the UN Security Council resolution
calling for border controls. . . Page 10 25X1
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ii
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
New Syrian Government: The new Syrian cabinet formed on 13
September, main y a combination of old hands, can be
expected to do little more than maintain an uneasy
coalition dependent upon the army for its continuance
in power. . , . . . Page 10 25X1
Satellites Releasing Some Political Prisoners: Several of
the Eastern European a e to refines are continuing a
policy, begun in 1954, of quietly :releasing political
prisoners, including leaders of former opposition parties
and purged Communists. The releases are probably intended
to reduce internal tensions and to give further substance
to the recent well-publicized amnesties aimed at enticing
political refugees to re u n o their homelands.
. 0 . 6 O O 0 0 0 0 O Page 11
Peruvian-Ecuadoran Controversy: The Peruvian-Ecuadoran
boundary dispute as once again flared up with Ecuador
charging before the Organization of American States that
Peru is concentrating a large invasion force near the
frontier. These charges have thus far not been borne
out by the observations of the neutral militar investi-
gating commission, . Page 12 25X1
SIGNS OF SHIFT IN INDIAN POLICY TOWARD THE UNITED STATES.. Page 1
Indian prime minister Nehru, his political adviser V. K.
Krishna Menon, and Indian representatives at the United Nations
and on the International Control Commission in Indochina have
recently made statements which were unusually sympathetic
toward the United States and hinted at an imminent change in
India's foreign policy. These statements, together with other
information from New Delhi that Nehru has been reviewing
foreign policy problems since his return from the USSR, suggest
that Nehru has decided to adopt a more friendly attitude
toward the United States.
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iii
THE WEEK IN BRIEF
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
COMMUNIST CHINA: UN REPRESENTATION AND RECOGNITION . . . Page 3
Nationalist China will probably retain the majority
support of this year's UN General Assembly, but there is a
growing tendency among UN members to suggest new means of
solving the Chinese representation problem. No UN members-
have established relations with Communist China since 1950,
but recently such influential members as France, Belgium, and
Canada have considered early recognition. During the past
year, moreover, Peiping has stepped up efforts to extend its
cultural and economic contacts with other nations.
POST-GENEVA. PROSPECTS FOR EAST-WEST TRADE CONTROLS . . . . Page 5
One of the major consequences of the "Geneva spirit"
seems likely to be a further relaxation of Western controls
on exports to the Sino-Soviet bloc. Many COCOM members have
made it clear they now feel more strongly than ever that the
present system of export controls is too stringent, and that,
in particular, the differential between the China list and
other control lists should be eliminated. A meeting of the
COCOM Consultative Group to consider further liberalization
of trade will probably follow the October foreign ministers'
meeting.
REPORT ON KAZAKHSTAN . . . . , , . , , , . Page 10
Moscow is showing increased interest in economic exploita-
tion of Kazakhstan, the largest of the Soviet Union's central
Asian republics. The Kazakh SSR, covering an area one-third
that of the United States, contains the largest proven deposits
of iron ore in the USSR. These fields are in close proximity
to deposits of coking coal. Recent statements in the Soviet
press have strongly suggested that the Soviet government will
begin the construction of a heavy industrial base there as
part of the sixth Soviet Five-Year Plan (1956-60).
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` SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
OF IMMEDIATE INTEREST
SOVIET-WEST GERMAN TALKS
Both the USSR and the West
German government achieved
immediate objectives in the
Moscow talks. Each desired for
different reasons to establish
diplomatic relations. The
Soviet government regards estab-.
lishment of relations as a
major step toward freezing the
status--quo In Europe without
concessions on German unity.
Adenauer presumably regards
such relations as a preroga-
tive and possibly as of special
value in exploring the problem
of German unity on a continuing
basis with Soviet officials.
Arrangements for the return of
German prisoners will give
Adenauer a timely weapon with
which to deal with any parlia-
mentary criticism.
Soviet Negotiating Tactics
Prior to: the talks, Soviet
diplomats had indicated that
the prisoner issue should
present no particular problem,
but that the USSR refused to
accept unity discussions as a
prerequisite to the establish-
ment of normal relations. So-
viet insistence that discussions
on the prisoner issue should be
postponed and that the East
Germans should be included in
them appears to have been
merely a bargaining device.
Moscow's refusal to in-
clude the promise for a return
of prisoners-in the written
agreement and the silence of
Soviet propaganda on the issue
may indicate that an attempt
will be made to give East German
premier Grotewohl the credit
for securing their release
during his current visit to
Moscow. The USSR has long
insisted that it only held -+o me
"war criminals," now set at
9,626, and Ambassador Bohlen
believes that the USSR may 'try
to ~ make the return of over
100,000 more persons which Bonn
claims are interned in the
Soviet Union dependent on. the
return of an equal number of
forever Soviet citizens who
Bulganin has now alleged are
in 'West Germany.
West German views
For the past 18 months
Adenauer had been saying that
he favored diplomatic relations
with Moscow. During the summer,
however, when it became apparent
that Moscow too was eager for
diplomatic relations, Adenauer
began to think that it was
better td-exchange "diplomatic
agents" and not ambassadors in
order to emphasize that normal
relations could not,exist until
his nation was reunited.
Bulganin's assurance on
the return of German prisoners
was undoubtedly instrumental
in persuading him to return to
his original position on estab-
lishing full: diplomatic rela-
tions4
Because few West Germans
expected any signficant progress
on unity, the chancellor should
have little difficulty in defend-
ing his bargain before German
public opinion. 'He is in a posi-
tion, moreover, to. tell his
critics that parliament can re-
fusee to ratif his bargain if
the Soviet Union fails to
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PART I OF IMMEDIATE INT1 RF;T Doom I of 9
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
release large numbers of
prisoners at an early date.
In his letter to Bulganin,
Adenauer restated for the rec-
o rd that mutual recognition
leaves unchanged Bonn's stand
that it is the only legitimate
German government, and that
Germany's borders must ulti-
mately be determined by a
German peace treaty.
Adenauer also secured
Soviet verbal assurances that
along with the prisoners of
war, detained German civilian
internees would be freed. Be-
cause the prisoner issue is so
emotionally charged in West
Germany, and inherently con-
fused, it is likely to create
new problems between the two
governments. For example,
many West Germans will expect
the Soviet Union to secure the
release of West Germans origi-
nally tried by Soviet courts-
martial but incarcerated in
East German jails.
New trade negotiations be-
tween the Soviet Union and West
Germany, mentioned in the final
agreement, are not likely to
bring about any significant in-
crease in trade, mainly be-
cause Soviet products cannot
compete on favorable terms in
West German markets.
The firmness and bluntness
with which the Soviet delegates
maintained their position at
the meeting have aroused strong
criticism in the West German
press and apparently served to
strengthen the Bonn government's
belief that the West can nego-
tiate with the USSR only from
a -_?osition of strength.
Tactics at October Conference
The agreement with Adenauer
on the establishment of re?-
lations will play an important
role in the Soviet tactics at
the Big Four foreign ministers'
meeting at Geneva in late Octo-
ber. At Geneva the Soviet dele-
gation is almost certain to re-
peat the line established at the
summit conference and reiterated
bluntly to Adenauer that re-
unification of Germany is im-
possible until a new security
system has replaced NATO and
the Warsaw pact organization.
The USSR will argue that by
establishing relations with Bonn
and thus recognizing the divi-
sion of Germany into two sover-
eign states, it has paved the
way for preliminary security
arrangements among the European
states.
The USSR is likely to take
further steps to make more
appealing its program for a
gradual development of security
arrangements in a divided
Germany. These will be designed
to exert pressure on Bonn to
delay West German rearmament
and increase its contacts with
East Germany, to make NATO be-
gin to wither away, and eventu-
ally to cause American troops
and bases to be withdrawn from
Europe.
able of its leaders.
German regime, Moscow may clean
out some of the most objection-
Fo? example, the Soviet
delegation at Geneva may show
an interest in some of Prime
Minister Eden's security p,opos-
a l s, particularly for a pact
among a limited number of Euro-
pean states. The USSR might
also pull some of its divisions
out of East Germany, While
strongly supporting the East 25X1
# 10
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PART I OF IMMFr)TATF. TNTFT?F.gT n- __ n _.V r,
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. SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
PART II
NOTES AND COMMENTS
Soviet Tactics
In sarmament Talks
Soviet delegate Sobolev's
main efforts in the second week
of the UN disarmament subcom-
mittee negotiations were de-.
voted to probing for possible
differences in approach among
the four Western powers.
His negotiating tactics,
supported by Soviet propaganda,
appeared aimed at creating the
impression that the United
States had abandoned interest
in an eventual prohibition of
nuclear weapons and reduction
of conventional armaments. In
the 8 September sessions, Sobo-
lev maintained that the Amer-
ican delegate's answers to So-
viet questions were evasive and
not "exhaustive." Moscow radio
complained that the United
States' reservations on its pre-
Geneva disarmament positions
"prevents the forming of a clear
opinion about the US attitude
toward the Soviet proposals."
On 9 September, Sobolev
questioned whether the United
States still agreed to the
phased reduction of conventional
armaments and asked if the Amer-
ican reservations also concerned
the 1954 UN resolution which
American-Chinese Talks
The. Chinese Communists
during the second part of the
Geneva talks probably will con-
tinue to aim toward arranging
higher-level negotiations with
the United States on major
matters. This objective was
.stated explicitly by Wang Ping-
nan during the 14 September
meeting.
would prohibit nuclear weapons.
He requested the American dele-
gate to clarify whether the
United States has given up ef-
forts of the last ten years to
establish control of atomic
weapons.
and nuclear.weapons.
Sobolev did not commit him-
self on the vital question of
inspection and control. He said
that he had not yet received any
"particular" indication of his
government's reaction to Presi-
dent Eisenhower's "blueprint"
proposals. He also failed to
amplify the USSR's 10 May
proposals on inspection.
American delegate Stassen
observed that the Soviet rep-
resentatives' attitude is still
moderate and that they have not
yet sought to transform the
meetings into a cold-war forum.
Stassen believes the USSR may
be laying the groundwork for a
new proposal combining limited
ground inspection based on the
Soviet plan of 10 May with the
President's "blueprint" propos-
als. On the other hand, he be-
lieves Moscow could be planning
to reject the American proposals 25X1
on the grounds they do pot as-'
sure a reduction - in. conventional
To further this aim, Peiping
took a conciliatory line on the
question of.detained.nationals,
freeing the 11 airmen, promising
the early release of 23 civil-
ians, and agreeing to act
"expeditiously" on the remain-
ing 19 or 20. The Chinese
obtained an arrangment by which
the :Indian embassy in Washington
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PART II NOTES AND` cclMUFN1 e
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15 September 1955
will facilitate the return of
Chinese who feel they are being
prevented from departing.
It is doubtful that all of
the remaining 19 or 20 Americans
will be freed in the near future.
Peiping has consistently indi-
cated it will continue to hold
some of them indefinitely in
order to save face, to ensure
satisfactory action on Chinese
in the United States, and to
secure concessions as the
Geneva talks develop. Wang has
informed Ambassador Johnson
that the remaining cases will
be considered individually,
thus suggesting that there will
be no further mass releases.
Apparently the Chinese
wish to minimize discussions at
Geneva on implementation of the
repatriation agreement. Wang
has told Johnson that progress
on the remaining cases will be
reported to the United States
through the British mission in
Peiping. This suggests a
Chinese hope for early dis-
cussion of the second agenda
item, "other practical matters
at issue."
Apparently in anticipation
of developments in the Wang-
Johnson talks, the Chinese
Communists last month seemed
to be preparing a position on
Soviet-Japanese Negotiations
In the Soviet-Japanese
discussions in London, the USSR
has made minor concessions on
the issues of returning prison-
ers of war and restoring Soviet-
held island territory to Japan.
On the third major point at
issue, however, the USSR has
continued to argue that naviga-
tion on the Sea of Japan must
be regulated by the riparian
powers, a demand the Japanese
the principle of renunciation
of force. Peiping's latest
comment on this concept supports
previous indications that any
Chinese formula will be based
on a withdrawal of American
forces from the Formosa Straits
area.
Previous remarks by Chou
En-:Lai suggest that Peiping
will endeavor to include among
the "practical matters" the
question of military and intelli-
gence operations in the China
area. Wang asked on 14 Sep-
tember that the question of
lifting Western trade restric-
tions against China be resolved.
He has hinted that travel in
China by Americans might be
discussed. Peiping may also
try to bring up for discussion
the exclusion of Peiping from
the United Nations, American
nonrecognition of Communist
China, and the American commit-
meni to defend Formosa.
Peiping almost certainly
calculates, however, that major
questions cannot be resolved
under the limited terms of the
Geneva talks. The Chinese can
thus be expected to press for 25X1
a higher-level meeting to
discuss the whole question
of "relaxing tensions."
have insisted they cannot accept
since it involves an interna-
tiorial body of water.
Soviet delegate Malik had
told Japanese delegate Matsumoto
repeatedly that the prisoner
issue would be solved when rela-
tions were normalized. On 5
September, however, Malik gave
Matsumoto a list of prisoners
on whom the USSR would declare a
SECRET
DAUM TT LT1''IDc awm nnu~rz+wrcno r_-_ n _- ,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
"special amnesty,"
effective only when
an agreement was
reached on the nor-
malization of rela-
tions. The list con-
tained 1,365 names--
a number smaller by
several thousand than
Japanese estimates,
but desGri?$ed? by
Malik as the total
number held by the
USSR.
On territorial
issues, the USSR had
viously belonging to Japan,
which included southern Sakha-
lin and the Kuril Island chain.
At the 30 August meeting, how-
ever, he offered the return of
Shikotan and the 'Habomais, ` very
small islands just north of,
FIo':.'Caido. On this occasion,
Malik did not attach conditions
to the offer.
returning any Soviet-
held territory pre-
insisted that this
question was solved
once and for all by
the Yalta and Pots-
dam agreements. Ma-
lik originally re-
fused to consider
the possibility of
On 6 September, however,
Mali: announced that the USSR
was ready to discuss the "tech,
nical details" of handing. over
the islands and stated that in
view of the present situation
in the Pacific and its bearing
on the security of the USSR,
the transfer of the islands
would be conditioned 'on 'Japan's
agreement not to use them for ??-
military purposes. He said the:
USSR would not accept the pros-.
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pect of two additional bases in
the area.
It is possible that Malik's
original offer on 30 August was
designed to influence Japanese-
American discussions then in
progress in Washington by giv-
ing the Japanese encouragement
to press for the return of
islands occupied by the United
States.
The USSR's demand that
navigation in the Sea of Japan
be controlled by.the.riparian
powers is probably regarded by
Moscow mainly as a bargaining
point to obtain concessions on
other issues. In Moscow's view,
a "closed" Sea of Japan would
allow free navigation for com-
mercial vessels of all nations,
but would restrict warships of
nonriparian powers.
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PART II 'NOTES AND COMMENTS Paap R,nf 7I
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
The Japanese have insisted
that the Sea of Japan is an
international body of water, and
navigation on it must be unre-
stricted. The Japanese will
probably insist that the prob-
lem has no connection with a
peace treaty between the two
countries, and that it has a
bearing on Japan's future and
its current arrangements with
other countries, rather-than
problems evolving from World
War II. Tokyo's final position
in the negotiations will be
largely determined by domestic
political considerations.
Refugee Influx from East Germany
Reaefies Two-year Peak
The desire to escape mili-
tary service and.depressed eco-
nomic conditions, and rising
despair of political reform in
East Germany have brought the
number of refugees from East
Germany during recent weeks to
Prime Minister Hatoyama might
decide that the only way to
strengthen his government, which
has been weakened by criticism
of his foreign minister's talks
in Washington, is to reach a
quick agreement with the USSR.
Although Moscow's willingness
to return Shikotan and the Habo-
mai Islands has received little
publicity and aroused no favor-
able comment, if Hatoyama de-
cided to make a deal--as has
been rumored--he could play up
the Soviet offer as a major con-
cession with good prospects that
it would have considerable pub-
lic appeal.
the highest point since June
1953, the month of the anti-
Communist riots.
During the week ending 3
September, 4,177 refugees ar-
rived in West Berlin, the major
SECRET
escape center. Of
these,1,064 were men
of military age. Dur-
ing the first half of
1955, a total of some
124,665 East Germans
escaped, compared with
194,080 for all 1954.
Since mid April,
approximately 13,000
potential recruits
for an East German
army have fled to West
Berlin. This in-
creased flow was set
off by a stepped-up
recruiting drive for
the Garrisoned Peo-
ples Police (KVP) and
the threat of tighter
internal security
measures.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
The serious drain on man,
power and unfavorable public
reaction to the harsh methods
employed by recruiting offi-
cials reportedly forced East
German Socialist Unity Party
(SED) officials on 11 July to
suspend all recruiting for one
month. Although there has been
no report of resumption of full-
speed recruiting, the flood of
young men to West Berlin has
continued to increase.
Many refugees have been
attracted by abundant job op-
portunities in booming West
Germany. The East German
economy, already suffering
from serious manpower shortages,
Greek and Turkish Governments
Move to Ease Tensions
The Greek and Turkish gov-
ernments are moving to calm the
passions aroused during and
after the London conference on
the Cyprus issue. Although a
gradual easing of Greek Turkish
tension is likely, the unre-
solved differences over Cyprus
and other issues will continue
to make their relations uneasy.
Following the anti-Greek
riots of 6 and 7 September in
Turkey, the Greek government
took extreme precautions to
protect the Turks in Greece.
Turkish establishments were
placed under heavy guard and
troop reinforcements were sent
to Thrace to protect the Turk-
ish minority there. Public
gatherings were prohibited.
Athens did, however, com-
plain to Ankara, to NATO, and
to various foreign governments
in an apparent effort to capi-
talize on the situation.
Ankara rejected an official
Greek note of protest on 10
September because one of the
will be further handicapped by
the loss of actual or potential
workers, particularly skilled
labor and technicians.
The recent marked increase
in the number of refugees may
also be due in part to growing
despair of any liberalization
of political conditions in East
Germany.
*est sectors of Berlin.
To halt the refugee flow
through West Berlin, the major
escape center, East German
authorities are seeking to dis-
courage travel into the western
sectors. East Germans and East
Berliners have been asked to
sign pledges not to visit the
passages attributed responsi-
bility for the anti-Greek riots
to the Turkish government.
Athens decided to delete the
objectionable passage before
resubmitting the note.
Athens also canceled
Greek participation in interna-
tional conferences meeting in
Ista>nbul and in forthcoming
NATO exercises, Deputy Premier
Kanellopoulos later told the
American embassy that he hoped
the atmosphere would improve
sufficiently by early October
to permit Greek participation
in NATO exercises then.
Some evidence indicates
official Turkish toleration in
early stages of the riots in
Istanbul and Izmir. The gov-
ernment evidently did not ex-
pect such large-scale mob vio-
lence as developed, however,
and belatedly took severe
measures to restore order,
Ambassador Warren in Ankara says
subsequent Turkish actions re-
flect the government's profound
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15 September 1955
distress and determination to
make full reparation. The
Turkish minister of the interior
has been replaced for failure
to prevent the riots, and the
militant "Cyprus-is-Turkish
Society" has been banned.
The Turkish Grand National
Assembly, meeting in extraor-
dinary session on 12 September,
unanimously condemned the riots.
It promised "proper" punishment
for those responsible and full
compensation for those who suf-
fered damages. Estimates of
the damages run as high as
$100,000,000. The assembly
also approved a six-month ex-
tension of martial law declared
in Istanbul, Izmir, and Ankara.
Meanwhile the Greek and
Turkish positions on the Cyprus
French North Africa
Morocco: Moroccan nation-
alists are -likely to engage in
widespread violence unless
Sultan Mohamed ben Arafa departs
in the next few days. His de-
parture, on the other hand, may
set off disorders instigated by
the French settlers who strongly
oppose the Faure program.
Acceptance by former sultan
Mohamed ben Youssef of French
premier Faure's Moroccan program,
seems to have had an at least
temporary quieting effect. A
nationalist-directed general
strike scheduled for 12 August
in the event Sultan Ben Arafa
was still on the throne failed
to materialize, even though
Ben Arafa again issued a com-
munique stating he would not
step down.
question remain irreconcilable.
Athens and Ankara both rejected
the British proposal for self-
government on Cyprus, and Greece
remains committed to pursue its
appeal to the United Nations.
While Greece apparently has
tried to use the Turkish riots
to improve its position on this
issue in the UN, Ankara insists
that the riots cannot be used
to force any Turkish concessions
on Cyprus.
Nevertheless, present in-
dications are that a mutually
satisfactory formula for shelv-
ing the Cyprus issue for the
time being may be found.
Considerable danger is in-
herent in the arming of some
20,000 civilians to assist in
maintaining order in the cities.
Many members of this new militia
sympathize with the reactionary
Presence Francaise organization
and would not be wholly reliable
should the settlers decide to
act.
Algeria: The Algerian Com-
munist arty was outlawed on 13
September, ostensibly because
it supported the anti-French up--
risirng of 20 August, but more
probably in response to French
settler pressure. The extent
of Communist involvement in the
20 August violence is not known.
Rebel activities continue
and may be increasing. Martial
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CURRENT INTELLIGENCE WEEKLY SUIR!! Y
15 September 1955
law has been declared in the
Philippeville area, the center
of last month's uprising. Re-
ports that some modern Czech-
manufactured submachine guns
were captured by the army will
tend to dispel confidence in
Governor General Soustelle,'
whose recent denials that the
rebels possessed modern weapons
had been widely accepted.
Meanwhile, support for na-
tionalist demands for Algerian
independence is reported to have
grown significantly following
the stiff reprisals undertaken
by the French since 20 August.
The Moslem deputies to the
French National Assembly from
the department of Constantine
in eastern Algeria, whose elec-
tion was rigged by the French
authorities and who consequently
had been considered pro-French,
are reported to have asked Faure
on 7 September to recognize Al-
geria as an independent state.
French settler opposition
to Soustelle has also intensi-
USSR Presses Iran
To Maintain Neutral Position
The Soviet Union in recent
weeks has brought diplomatic
pressure to bear on Iran to
prevent it from joining the
Turkish-Iraqi pact. The USSR
has made clear that it expects
a quid pro quo for its concilia-
tory approach to problems in
Soviet-Iranian relations during
the past year, and,in line with
Soviet policy toward the other
Middle Eastern states, is urging
Iran to adopt a neutral position
in international affairs.
fied. Encouraged by the success
of the French settlers in
Morocco in securing the ouster
of Resident General Grandval,
the French settlers in Algeria
are attempting to obtain Sous-
telle's removal.
Tunisia: Salah ben Yous-
sef, secretary general of the
nationalist Neo-Destour party
and leader of its extreme wing,
returned to Tunis on 13 Septem-
ber after nearly four years of
exile in the Near East. His
declaration that he intends to
work for complete Tunisian inde-
pendence indicates he can be ex-
pected to complicate implemen-
tation of the French Tunisian
conventions which provide for
limited autonomy and went into
effect on 31 August.
The cabinet of Premier
Tahaxr ben Amar, which negotiated
the conventions with France,
resigned as expected on 13 Sep-
tember. The bey requested Ben
Amar to form the new cabinet.
protestea in
s rang " against what
he described as heavy pressure
on the Iranian government to
Join the Turkish-Iraqi pact.
Lavrentiev stated that Iranian
adherence to the pact would be
a blow to world peace, distinctly
prejudicial to friendly relations
between the USSR and Iran, and
contrary to existing Soviet-
Iranian treaties.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
Acting Foreign Minister
Samii told the American embassy
on 12 September that the Iranian
government had noticed a dis-
tinct "lessening of cordiality"
on the part of the Soviet
government in the last two
weeks. He cited as examples
Lavrentiev's protests to the
Shah, a "stiff and arbitrary
attitude" on the part of Rus-
sian negotiators in the Soviet-
Iranian border commission pro-
ceedings, and Soviet obstruc-
tions over the type of goods to
be supplied to Iran to repay
the $8,000,000 liability under
the 1943 payments agreement.
The USSR, both officially
and in propaganda, continues to
insist that a neutral position,
independent of all international
Finnish President's
sit to Moscow
President Paasikivi's pend-
ing visit to Moscow, arranged
at Soviet initiative, has
aroused some apprehension in
Finnish political and military
circles over the possibility
that new commitments to the
USSR will be required. Paas-
ikivi, on the other hand, re-
portedly hopes to obtain certain
concessions. The Soviet Union
is unlikely to make major con-
cessions. It will probably also
avoid any strong pressure on
Finland at this time because of
the satisfactory state of cur-
rent Finnish-Soviet relations.
The president's party,
scheduled to leave for Moscow
on 15 September, includes the
premier and defense minister,,
power groupings, is best for
Iran. Lavrentiev mentioned to
the Shah on 8 September that
Moscow would respect such a
policy.
The USSR's willingness to
respect Iran's neutrality in
international affairs is a
follow-up of Bulganin's remarks
at Geneva referring to Soviet
readiness to guarantee, together
with "other powers," the neu-
trality of any country. In Au-
gust, the USSR offered Saudi
Arabia such a guarantee, with
the stipulation that Washington
be a partner in any pact formali-
zing the guarantee. It is prob-
able that the USSR will make
similar proposals to other Mid-
dle Eastern countries.
but, so far as is known, no high-
ranking military personnel. The
Finnish foreign minister has
told the American ambassador
that although there was no agen-
da for the talks, he believed
Finland might "benefit."
There is speculation in the
Finnish press and in official
circles that the USSR may offer
to make concessions regarding
the Soviet-occupied naval base
at Porkkala or full use by the
Finns of the Saimaa canal, in-
cluding port and dock facilities
near the city of Vyborg at its
southern terminus, now in Soviet
territory. The Social Demo-
cratic Party, the largest in
parliament, is, like other groups,
concerned over the price of any
such concessions. It reportedly
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? SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
OP
BARENTS
SEA
l' - :~iamensY
F I N L A N D
Kuap,o.
ikko-I
". - OF FINLAN
WORKKALA GULF. -,
l.AK?
LAOA
Nepalese Rebel. Leader
Returns from Communist China
Nepalese rebel leader Dr.
K. I Singh, who fled to Commu-
nist China after a coup attempt
in January 1952, has now re-
turned to Nepal and will almost
certainly play a key role in the
country's politics.
Singh received a royal par-
don on 11 September, and he has
renounced violence and promised
loyalty to the crown. He ar-
rived at Katmandu on 13 Septem-
ber, when some 50,000 people
gathered to witness his return.
Singh was not a Communist
prior to his exile, and the ex-
tent to which he has been influ-
enced by his stay in Communist
China is not yet certain. De-
spite his statement that he had
not come back to propagate Com-
munism in Nepal, it is generally
has served notice on the presi-
dent that any decisions reached
in Moscow must be confirmed by
parliament.
In view of 'the friendly,
almost.cordial, official rela-
tions which have existed between
Finland and the Soviet Union in
the past year, it seems unlikely
that the USSR would seek to pres-
sure Finland at this time into
any far-reaching military or
political agreement. Rather,
the Russians might make concil-
iatory gestures with an eye to
influencing next winter's presi-
dential election in favor of
President Paasikivi,who has
diligently pursued a policy of
friendship toward the USSR, or
some other like-minded individ-
ual. Furthermore, the Soviet
Union would be glad to impress
the Scandinavian countries with
its "reasonableness" in view of
the forthcoming visits to Mos-
cow of the Norwegian and
Swedish premiers.
assumed he will follow the Com-
munist line.
Singh's earlier activities
proved him a capable leader with
considerable popular appeal.
He will probably attempt to take
advantage of current interparty
.squabbling over King Mahendra's
proposal fora return to repre-
sentative government, and he
can be expected to '.play a signif-
icant role in next year's elec-
tions to the Constituent Assembly.
Both Mahendra and the In-
dian government, which exercises
strong influence in the Hima-
layan kingdom, will attempt to
see to it that Singh does not
again attain a dominant posi-
tion in Nepalese politics,
especially in view of recent
manifestations of increasing Chi-
nese interest in Nepal.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
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Egyptian-Israeli Situation
Egypt and Israel have ob-
served a strict.armistice on
the Gaza frontier since their
acceptance on 4 September of
the cease-fire proposal of UN
truce supervisor Burns.
Neither Cairo nor Tel Aviv
has indicated its attitude to-
ward the UN Security Council's
resolution of 8 September call-
ing on both to co-operate in
border controls separating the
Egyptian and Israeli forces as
proposed by General Burns.
Egypt opposes the proposal
for a continuous physical bar-
rier between Israel and the Gaza
strip, fearing that this would
be interpreted as a permanent
demarcation line.
Israel, meanwhile, contends
that Burns' proposal for a neu-
tral zone separating the armed
forces of the two countries
would involve an infringement
New Syrian Government
The new Syrian cabinet
formed on 13 September, mainly
a combination of old hands, is
unlikely to bring any fundamen-
tal improvement to the Syrian
political scene.
Headed by Said al-Ghazzi,
a former prime minister whose
principal qualification is his
inoffensiveness to other polit-
ical leaders, the cabinet is a
coalition of conservative Pop-
ulists and independents, with
some representation given re-
ligious groups and big business
interests. All but two of the
13 members have served in one
or another of Syria's cabinets
during the past four years.
? GAZA STRIP
ARMISTICE LINE (1949)
0 25
on Israeli sovereignty and make
it impossible for Israeli forces
to protect settlers near the
border.
Burns, while not optimis-
tic, still hopes by separate
negotiations with each country
to obtain some agreement on
carrying out the Security Coun-
cil's resolution.
The weakness of the cabinet
is illustrated by a report that
three of the new ministers
sought to resign within a few
hours of their appointment.
Also indicative of future diffi-
culties is the assumption by
Ghazzi of the foreign affairs
portfolio, probably because no
one else could be persuaded to
take so thankless a job.
The character of the new
cabinet puts the burden of ac-
tual government on newly in-
stalled President Quwatli, whose
main aim for the immediate fu-
ture is likely to be to avoid
difficult issues rather than
face up to them. Such a policy
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
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will not lead Syria toward.
greater internal stability, nor
is it likely over the long,run
to satisfy Iraq and Egypt, the
principal sources of outside
pressure on Syrian governments:
Satellites Releasing
Some Political Prisoners
Several of the East Euro-
pean Satellite regimes are con-
tinuing a policy, begun in
1954, of quietly releasing
political prisoners, including
leaders of former opposition
parties and purged Communists
who were imprisoned--usually
without trial--prior to 1953.
The releases are probably
intended to reduce internal
tensions and to give further
substance to the recent well-
publicized amnesties aimed at
enticing political refugees to
return to their homelands.
This policy is consonant with
Orbit efforts to improve rela-
tions with Yugoslavia, although
this was probably not a decid-
ing factor in its initiation.
The Hungarian regime
reed without publicity
about 90 former Social Demo-
crats on 20 August, Hungarian
Constitution Day. The American
legation in Bucharest has
learned
that 28 nian professional
and political leaders who had
been part of a group of 180
imprisoned without trial in May
1950 were released in July.
similar releases
rom Bulgaria
and from o land, where the
former Nationalist Communist
leader Wladyslaw Gomulka was
to be creed
from "unjust imprisonment .
SECRET
For the short run, however,
Quwatli can probably hold on
if he stays in the good graces
of the army, particularly Chief
mediate situation.
of Staff Shuqayr, the really
decisive factor in Syria's im-
Except in Bulgaria, where
the recantation of former op-
p9sition leaders has been propa-
gandized by the regime in a
campaign to support the Father-
land Front, the releases have
tiot, been publicized by the
Communist regimes. Knowledge
of the releases has been gained
through the appearance of long-
jailed political figures at
public gatherings, where they
have often been identified with
titles indicating that they had
received positions of minor
importance in the regime.
While many of the releases
probably stem from the fact
that the individuals have ful-
filled the sentences settled on
them by administrative action,
most of them probably result
from amnesties or judicial re-
view.
While they have released
political prisoners, several of
the Satellites are still main-
taining heavy internal pres-
sure to prevent nationalist
deviation.
gimes are still quietly round-
ing up and imprisoning members
of former opposition parties
and deviationists within the
Communist Party. Followers of
ousted former Hungarian premier
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15 September.1955
Nagy are reportedly being re-
moved from party membership.
Neither the Czech nor the
Hungarian regime has ended its
crackdown on remnants of the
Social Democratic Party.
The coincidence of these
contradictory trends indicates
Peruvian-Ecuadoran Controversy
The Peruvian-Ecuadoran
boundary dispute has once again
flared up with Ecuador charging
before the Organization of Am-
erican States (OAS) that Peru
is concentrating a large in-
vasion force near the frontier.
Border clashes have thus far
been averted by the presence
of a neutral military investi-
gating commission.
Border disputes between
the two countries go back 125
ECUADOR- PERU
the ;sensitivity of the balance
Satellite leaders are trying
to maintain between efforts
to strengthen party discipline
and to develop popular sup-
port for the regimes and the
active support of the party
membership.
years and have been the cause
of four wars, the last in 1941.
The 1942 Rio Protocol of
Peace, Friendship and Bound-
aries, concluded under the aus-
pices of the United States,
Argentina, Brazil and Chile as
guarantors, provides a basis
for.demarcation of the frontier,
ten ;percent of which remains
undemarcated. Under ,the Rio
terms, all border incidents
are to be settled between the
BOUNDARY DISPUTE
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two countries with
the assistance of
the guarantors.
The Ecuadoran
delegate denounced
Peru before the OAS
on 7 September, ac-
cusing it of vio-
lating Ecuador's
territorial sover-
eignty and "preparing
to invade." Simul-
taneously, the Ecua-
doran foreign minis-
ter in Quito request-
ed a meeting of the
protocol guarantors
which subsequently
provided for neutral
military inspection
of key areas in both
countries.
Allegations of
increased Peruvian
troop movements and
massing of armed
forces at the border
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t
CURRENT INTELLIGENCE WEEKL' SUIdRY
15 September 1955
have not been substantiated
thus far by American military
mission personnel who have
made both ground and air in-
spection trips of the border
and other areas. In fact,
Ecuadoran allegations that
Peruvian vessels were rendez-
vousing in preparation for
hostile action have proved to
be pure fabrication.
It is unlikely that -either
side would deliberately pro-
voke war, primarily in view
of the immediate sanctions that
would be-imposed under the`
Rio de Janeiro Reciprocal
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Assistance Treaty of 1947.
Border incidents will most
likely continue, however, while
the Velasco regime in Ecuador
continues to agitate for access
to the Amazon and for recovery
of territory lost as a result
of the Rio Protocol.
At the same time, it wou]d
be political. suicide for Presi-
dent Odria of Peru,. who is
maneuvering to perpetuate his
regime in power for another
six years, to surrender the
slightest amount of territory.
to Ecuador.
PART T T NOTFS ANTI rnmul wmc t,_ ...._ -1 n _.e -1 d'
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
PATTERNS AND PERSPECTIVES,
SIGNS OF SHIFT IN INDIAN POLICY TOWARD THE UNITED STATES
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Indian prime minister Neh-
ru, his political adviser V. K.
Krishna Menon, and Indian repre-
sentatives at the United Nations
and on the International Control
Commission in Indochina have re-
cently made statements which
were unusually sympathetic to-
ward the United States and hint-
ed at an imminent change in
India's foreign policy. These
statements,
Nehru has decided to abandon his
policy of strict neutrality and
to adopt a more friendly atti-
tude toward the United States.
This would be a major
change in Indian thinking. Any
change would probably not be
expressed in dramatic actions,
and Nehru would probably con-
tinue to stress his country's
independence of thought. There
may, however, be less criticism
of the United States, greater
co-operation on the part of
Indian officials, and a relax-
ation of restrictions on Amer-
ican business interests. India's
policy on multinational problems
such as international air agree-
ments would not necessarily be
affected.
Political and Economic Motives
Nehru's apparent change in
attitude may spring partly from
his recent visits to the USSR
and Communist China, during
which he was impressed by the
political and economic might
of these countries. Nehru is
istan as an example, he may
the inroads t-e USSR has made
into Afghanistan and the in-
creasing pressure China has
exerted on Nepal. With Afghan-
concerned over
suspect the motives behind So-
viet economic aid to India.
Viewing India's world position,
therefore, Nehru may have con-
cluded that India needs Western
friends to balance the combined
power in Asia of the Soviet
Union and China.
As a result of his trips
to Communist countries, Nehru
seems convinced of the need for
India to make rapid economic
progress to keep pace with
China, to discourage the growth
of Communism, and to ensure the
continuation of a Congress Party
government in India.
Nehru knows that India's
second Five-Year Plan, which
goes into effect in 1956, con-
tains a large gap between fi-
nancing available from Indian
resources and what is actually
required and must be obtained
through foreign aid. Being
aware of the current trend on
the part of the United States
to cut down foreign aid allot-
ments to certain areas, Nehru
may feel that India must be
assured of the continued flow
of large quantities of economic
assistance from the United
States to make the new plan a
success and achieve his aims.
Finally, Nehru may be chaf-
ing-under the restrictions of
the neutrality policy which pre-
vent him from freely expressing
his views or making positive
moves in any direction without
exposing himself to criticism
either from the West or the
Sino-.Soviet bloc.
Evidence of New Attitude
The evidence supporting
the possibility of a new Indian
attitude is as follows:
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
On 30 August the American
consul general in Madras report-
ed that V. K. Krishna Menon,
during a week's stay in Madras,
had vehemently defended the
American government both pub-
licly and privately, emphasiz-
ing the United States' peaceful
intentions and essential good
will.
On 31 August, the American
consul general also reported a
conversation between an Indian
official in the United Nations
and a reliable source, in which
the "new orientation" of Indian
foreign policy was explained.
The official said Nehru had
told him that he had returned
from the Soviet Union "disillu-
sioned" and convinced that India
must "unobtrusively but surely"
bring its foreign policy closer
to that of the United States.
Nehru felt this would be easier
now that "America for the first
time since Indian independence"
was beginning to understand that
"Indian hobnobbing with the
Chinese and Russians" was dic-
tated by security interests
alone.
reported that the Indian chair-
man of the International Con- 25X1
trol. Commission there had stated
that; India would inevitably have
to take a position "on one side
or another" rather than maintain
its neutralist attitude.
On 6 September,. Nehru crit-
Oicized in parliament a Chinese
.Communist claim that the United
States was involved in the crash
last; April of an Indian airliner
carrying~Chinese officials to
the Bandung conference. Nehru
said he had not seen the "re-.
mutest proof" that the United
States was involved and that
unsupported charges merely
"vitiate the atmosphere4"
Nehru's statement .in par-
liament on 6 September clearly
indicating that he intended to
prevent both mass marches and
individual penetrations into
the Portuguese territory of
Goa in the future may also be
indirectly connected with a
decision not to antagonize West-
ern nations.
On 11 September, the legal
adviser to the Indian UN dele-
gation told the American consul
general in Madras that in brief-
ing the UN delegation before its
departure Nehru had said that
relations with the United States
had grown closer. Nehru.said
that India must feel closer to
the United States and the West-
ern powers than to the Sino-
Soviet bloc although it was not
in ]India's interest to alter
its nonalignment policy at pres-
ent., He added that India must
not press the anticolonial issue 25X1
to the embarrassment of the
United States and Britain.
On 1 September, the Ameri-
can ambassador in Cambodia
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15 September 1955
COMMUNIST CHINA: UN REPRESENTATION AND RECOGNITION
Nationalist China will
probably retain the majority
support of this year's UN Gen-
eral Assembly, but there is a
growing tendency among UN mem-
bers to suggest new means of
solving the Chinese representa-
tion problem. There has been
little change in over-all UN
support for Nationalist China
since 1950, but the opposition
has been steadily picking up
more votes, and sentiment is
growing in favor of the eventual.
admission of Peiping.
No UN members have recog-
nized Communist China since
1950, but recently such in-
fluential members as France,
Belgium, and Canada have con-
sidered early recognition.
During the past year, moreover,
Peiping has stepped up efforts
to extend its cultural and
economic contacts with other
nations, particularly with
those in the Afro Asian bloc.
Chinese Representation in UN
Britain agreed on 8 Sep-
tember to support the American
proposal for a moratorium on
discussing Chinese representa-
tion at this session of the
General Assembly, thus in
effect assuring support for
Nationalist China from some
eight Commonwealth and Western
European members also. The
proposal, which has been intro-
duced at each session since
1950, has consistently been
supported by more than 40 of
the 60 UN members. These have
included the countries of
Latin America, Western Europe,
the older members of the Common-
wealth, and such countries as
Greece, Turkey, Israel, Iran,
Iraq, the Philippines and
Thailand. They are expected to
support it again this year.
Arab nations, like Egypt,
Saudi Arabia and Syria, may
abstain, as they have in the
past, but it is possible that,
led by Egypt, some of them will
oppose the moratorium. Support
for Communist China, in addition
to the Soviet bloc votes, prob-
ably will be registered by India,
Yugoslavia, and the Scandinavian
countries.
Indian UN delegate Krishna
Menon will probably join the
.fight for a substantive vote on
the question at this year's
session, but he may not lead it
as he did last year. Under UN
rules of procedure, the mora-
torium proposal should be voted
on prior to any substantive pro-
posal, and if passed, as antic-
ipat.ed, would effectively dis-
pose of any attempt to seat
Communist China at this General
Assembly.
Belgian foreign minister
Spaak suggested on 1 September
that, it might be desirable to
establish a UN study commission
to look into the whole problem
of admitting the Chinese Commu-
nists, and also look into the
1951, censure resolution. The
Canadian government has since
indicated that it would support
such a commission.
The idea of a study commis-
sion will appeal to the growing
number of UN members who favor
the eventual admission of Peiping
to the UN. Britain, in partic-
u 1 ar, would probably support
such a move. In June the Foreign
Office was believed to be con-
sidering a solution which would
keep Nationalist China in the UN
as Formosa and grant Peiping the
China seat on the Security
Council.
Taipei opposes the "two
Chinas" theory and would attempt
to prevent the General Assembly
from setting up a study commis-
sion. As early as 28 July,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
Recognizes Communist China
Recognizes Nationalist China
Recognizes Neither
OE UNITED KINGDOM
~I UNITED STATES 17RAS URUGUAY
A YD VENEZUELA
COLOMBIA NICARAGUA
COSTA RICA PANAMA
BA PARAGUAY
REPUBLIC PERU
ECUADOR PHILIPPINES
E SALVADOR THAILAND
IA TURKEY
NADA LUXEMBOURG
MEXICO
NETHERLANDS
IRAN
LIA ., IRAQ
SIT IUM LEBANON
-BRAZIL LIBERIA
BOLIVIA
DENMARK
EGYPT
GUATEMALA
INDIA
INDONESIA
ISRAEL
NORWAY
PAKISTAN
SAUDI ARABIA
YUGOSLAVIA
YEMEN
China's chief UN delegate T.F.
Tsiang expressed his govern-
ment's concern lest there be
any decline in the number of UN
members supporting the mora-
torium. The Nationalists fear
that with the lessening of
world tensions and the talks
at Geneva between the United
States and Communist China, UN
members will be encouraged to
reassess their policy on China's
seat in the UN.
Recognition of Peiping
Fifteen of the 60 members
of the United Nations recognize
the Peiping regime; 34 recognize
the Nationalist government.
Several nations now recognizing
Taipei are coming to the con-
clusion that Peiping must soon
be recognized.
French foreign minister
Pinay's remarks late in July
that France was "considering"
recognition of Communist China
but would not act "without her
Western allies" suggest that
Paris will apply greater pres-
sure on the United States for
closer relations with Peiping.
During 1955, Chinese Communist
students have visited France,
Peiping has participated in the
Lyon Fair and the Paris theater
festival, and private trade has
been developed. Economic and
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
cultural contacts are now being
openly promoted by Paris as an
admitted "first step" toward
ultimate recognition.
Belgian foreign minister
Spaak told American officials
in Brussels on 1 September that
"the time has come to recognize
the Communist Chinese regime."
Although Spaak has since agreed
to delay taking this step,
Belgian political and public
opinion favors early action in
this direction.
The Canadian government
strongly believes that Peiping
should be recognized "sooner
rather than later," possibly
within a year. American offi-
cials have been informed that
preliminary discussion of rec-
ognition will begin after
Canadian fisheries minister
Sinclair returns from his
"unofficial" visit to China.
At the Bandung conference
in particular and in other
cultural and economic contacts
during the year, Peiping has
made a special effort to im-
prove relations with the Afro-
Asian nations. Peiping's
strategy apparently calls first
for Egyptian recognition, and
then using Egyptian influence
to induce other Near Eastern
governments--primarily Saudi
Arabia and Syria--to follow
Egypt's lead.
To this end, Chou En-lai
is allegedly planning to visit
Egypt before the end of this
year. He may succeed in es-
tablishing diplomatic relations.
Cairo and Peiping have recently
concluded agreements providing
for the barter of'Egyptian
cotton for Chinese rolled steel.
Both Saudi Arabia and Syria
have received friendly-over-
tures from Communist China.
While recognition of Peiping
does not necessarily carry with
it support for Peiping's ad-
mission to the UN, it does por-
tend an eventual showdown in the
UN on the substantive issue of
Chinese representation. More-
over, UN members which recognize
or are considering recognition
of Peiping would be likely to
view the establishment of a UN 25X1
study commission as an important
step toward Peiping's admission
to the UN.
POST-GENEVA PROSPECTS FOR EAST-WEST TRADE CONTROLS
One of the major conse-
quences of the "Geneva spirit"
seems likely to be a further
relaxation of Western controls
on exports of the Sino-Soviet
bloc. The pace and extent of
this deterioration may depend
largely on the outcome of the
Big Four foreign ministers'
meeting in October, where an
important topic will be
"measures to br..-ing about a pro-
gressive elimi;iation of barriers
which interfere with free com-
munications and peaceful trade
between peoples."
Many COCOM members have
made it clear they now feel more
strongly than ever that the
present system of export con-
trols is too stringent, and
that the differential between
the China list and other con-
trol lists should in particular
be eliminated.
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15 September 1955
The Western Big Three have
accepted the view that, given a
general East-West detente,
"peaceful trade" is an issue on
which some concessions can be
made, "even to the extent of
accepting some risk." They also
agreed before Geneva that al-
though the export control sys-
tem was not to be discussed as
such, Moscow should be given to
understand that the system would
be re-examined if "substantial"
Soviet concessions were forth-
coming in "other fields."
Many COCOM members, how-
ever, are eager to offer con-
cessions for the mere promise
of future benefit. Their long-
standing aversion to "economic
warfare," their desire to re-
sume "normal" trade relations
with the Communist bloc, and
their doubts about the efficacy
of the present control system
have all intensified recently.
If the Soviet Union main-
tains its conciliatory attitude
through October, these nations
will probably be encouraged to
(1) expand East-West trade in
nonstrategic goods, (2) continue
their opposition to measures
aimed at tightening the present
control system and (3) intensi-
fy their efforts to abolish the
"China. differential" and lower
the level of controls on trade
with the whole Sino-Soviet bloc.
Nonstrategic East-West Trade
From 1949 until mid-1953,
trade in nonstrategic items
between the West and the Sino-
Soviet bloc declined generally.
Western trade with Communist
China in 1954 was below that
for 1953. In trade with the
USSR and its European Satellites
in 1954, Western exports in-
creased 35 percent and imports
rose 22 percent; the value of
this trade was still only 2.9
billion dollars, however, a
tiny fraction of the free world's
total trade.
Within the framework of
this rather limited commerce,
TOTAL TRADE : SINO-SOVIET BLOC WITH FREE WORLD
(MILLIONS OF U S DOLLARS)
1090
sal
3977
1927
3272
553
778
Q COMMUNIST
CHINA
U.S.S.R.
EUROPEAN
SATELLITES
946
1833
1947 1948 1949 1950 1951 1952 1953 1954
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
These effects are reflected
in part in the development of
recorded trade in items on the
three International Lists--em-
bargo, quota, and watch. COCOM
statistics show that COCOM-
country exports of such items
to the Soviet bloc more than
doubled last year, rising from
$76,000,000 in 1953 to $168,-
000,000 in 1954. Such items
accounted for about 25 percent
of total COCOM-country exports
to the Soviet bloc in 1954 as
against 15 percent in 1953.
Since the 1954 revision,
efforts to solve remaining is-
sues and to introduce further
improvements have been largely
unsuccessful. For example, by
the end of 1954, copper wire
and cable, which were removed
from the embargo list in August,
were being imported into the
bloc at an annual rate of 100,
000 tons--an amount which Amer-
ican officials believe is enough
to frustrate COCOM's embargo on
copper in other forms. Although
such copper shipments are con-
tinuing at a high rate, Amer-
ican efforts to obtain tighter
controls'have resulted only in
reinstatement of the embargo on
certain copper communications
items.
No acceptable formula has
been devised to institute more
effective controls on exports
of ships to the bloc. Deliv-
eries of ships last year totaled
80,400 gross tons, an increase
of 25 percent over 1953. A
substantial increase in deliv-
eries is expected during the
1955-57 period. As a result
of Britain's refusal to accept
a special dispensation for Den-
mark, ships have not been placed
under agreed quota.s, and dry-
cargo vessels continue to be
exported to the Soviet bloc on
a quid pro quo basis.
The negative attitude in
COC01M extends beyond strong com-
mercial interests in particular
commodities. Improvements in
certain COCOM administrative
procedures advanced by the
United States have been held in
abeyance since early this year.
there 25X1
is no point in retaining or
adding rules which will be vio-
lated in practice.
Sentiment now appears to
be developing in favor of an-
other downward revision of the
COCOM controls.
At the end of June, an
official spokesman told Amer-
ican representatives in London
that the British government held,
even more firmly than before it
increased its majority in the
26 May election, that East-West
trade controls should be further
relaxed. Not only did govern-
ment ministers refuse to consid-
er any new controls, they also
expressed dissatisfaction with
the size of the August 1954
revision. On 29 August, Britain
notified the United States that
London feels an "ever-increasing
urgency" to re-examine controls
on trade with the Sino-Soviet
bloc.
There are a number of in-
dications that Paris is of sim-
ilar mind. Without consulting
the United States, the French
:government in early August asked
the chairman of COCOM's Consul-
tative Groups to call a meeting
for 27 September. This meeting
of the Consultative Group, the
policy-making body for which
C000I :I'_s the executive committee,
would include a discussion of
a "further shortening of the
COCOM lists." Subsequent dis-
cussions among the Western Big
Three have left the date of the
meeting open, but the French
have made it clear that they
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15 September 1955
want it as soon as possible aft-
er the October meeting of for-
eign ministers.
The "China Differential"
A primary objective of the
British and the French is a re-
vision of controls on trade with
China. These controls will al-
most certainly be reviewed at
the next Consultative Group
meeting. The United States has
been committed for a year to
such a discussion, and sentiment
among the other Consultative
Group members is virtually unan-
imous for elimination of the
so-called "China differential."
C(~MMUNC , C A AL T`RAD '
t ion 9f,U S pol ars
This differential, which
began with the UN resolution
in May 1951 embargoing trade
with Communist China and North
Korea, has been progressively
increased. Apart from an em-
bargo on nuclear energy--and
munitions items to the entire
Sino-Soviet bloc and the uni-
lateral embargo on all trade
with China by the United States,
Western nations now prohibit
the shipment of about 500 items
to Communist China, as compared
with about 170 items embargoed
to the Soviet Union and its
European Satellites.
These more stringent con-
trols have been justified in
the past on the grounds that
they were directed against an
aggressor and were actually a
burden to the Peiping government.
Now, however, most Western na-
tions maintain that China can
obtain what it wants either in
or through the USSR. They also
argue that the China controls
at best impose a slight cost
burden on the Chinese economy,
and that meanwhile they increase
Peiping's dependence on Moscow,
raise tensions in the Far East,
and deprive Western nations of
a potential market.
As in the case of controls
on trade with the Soviet bloc,
the "China differential" is be-
ing treated as a question of
overriding political signifi-
cance. The Japanese government
continues to lead the fight for
elimination of the differential
primarily for domestic political
reasons and in full awareness of
its disappointing efforts to
revive trade with the Chinese
mainland during the past year.
France, which is now taking the
initiative for revision, has
never had any sizable commerce
with China. Britain's interest
in China trade can, because of
its, recent experience with busi-
ness interests left in China,
be regarded as primarily polit-
ical.
These political aspects may
well be decisive. Given the
present lack of concern in Eu-
rope over the Formosan situatioix
and the Communist Chinese will-
ingness to enter into negotia-
tions, the prestige of the United
States, which has sustained the
China list during the past year,
may no longer prevail.
Some Broader Implications
A period of even limited
economic coexistence appears
certain to create serious strains
on the unity on which any West-
ern economic defense program
must be based. Present indica-
tions are that an American re-
fusal to countenance further
relaxations of controls may well
disrupt the voluntary, multi-
lateral system on which the
present COCOM structure is based.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1955
Any efforts to make con-
trols more effective appear to
depend on the very argument
that most Western nations now
prefer not to accept--namely,
that,East-West relations still
require a posture of economic
defense. In the present mood
of virtually all of the Western
allies, it may take a relatively
small show of conciliation on
the part of the Soviet Union
to unite the Western European
countries and Japan in a demand
for drastic reduction of con-
trols on trade with the Sino-
Soviet bloc. Con- 25X1
curred in by ORR
Moscow is showing increased
interest in economic exploita-
tion of Kazakhstan, the lamest
Soviet republic In Central Asia,
which covers an area.one-third
that of the United States but
with a population of only 8,$50%-
090. It ,as selected as the
principal site for N. S. Khru-
shchev's virgin soil agricul-
tural program. Furthermore,
recent statements in the Soviet
press have strongly suggested
that the Soviet government will
begin the construction of a
heavy industrial base there
as part of the sixth Soviet
Five-Year Plan (1956-60).
Extensive personnel changes
over the past year and a half
not only reflect the growing
importance of this area in
Soviet thinking but reveal the
failure of native Kazakh poli-
ticians to measure up to the
regime's exacting requirements
for leadership in an area
undergoing rapid economic de-
velopment.
In a long article in the
3 July Kazakhstanskaya Pravda,
the president of the Kazakh
Academy of Science, Satpaev,
.stated that the republic's
proven deposits of iron ore,
mainly at Kustanai and in the
Karaganda region, were the
largest in the USSR. Kustanai
is on a rail line within 300
miles of the existing Urals
steel centers of Magnitogorsk,.
Chelyabinsk and Ziatoust. Dis-
covE~ry of iron deposits in the
vicinity of the Karaganda coal
fields, which supply good coking
coal, for the first time gives
the USSR both coal and iron in
the same area.
Satpaev placed great
emphasis on these developments,
declaring that "such an ex-
ceptionally fortunate geographi-
cal combination of ore and
coal predestines the creation
in the republic in the near
future of a most powerful coal-
metallurgical base, one of the
basic centers of ferrous metal-
lurgy and of heavy industry in
the USSR."
Industry
The Kazakh republic is one
of the Soviet Union's wealthiest
areas in terms of mineral re-
sources, but it is at present
principally devoted to the
production of raw materials and
foodstuffs. Construction of a
heavy industrial base there
would give the area a strong,
diversified economy.
It already plays a key
role in Soviet production of
nonferrous metals. The follow-
ing tabulation shows the
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15 September 1955
production of selected non-
ferrous metals in Kazakhstan
in comparison with production
in the entire USSR:
PLANNED INCREASES REPORTED KAZAKH SHARE
OVER 1950 KAZAKH SSR OF TOTAL USSR
FIFTH FIVE-YEAR PLAN INCREASES PRODUCTION 1955
(entire USSR) OVER 1950 (Soviet estimate)
Copper 90% 68% 57%
Lead 170% 150% 60%
Zinc 150% 120% 61%
With the beginning of pro-
duction at the large Dzhezkazgan
Copper Combine now under con-
struction, the Kazakh SSR will
have the benefit of a more
modern plant which will make
it possible for the republic
to produce an even greater
share of Soviet copper.
Kazakh party first secre-
tary Brezhnev in a recent
speech indirectly revealed that
the main reason the Soviet
Union did not fulfill the origi-
nal fifth Five-Year Plan goals
for copper, lead and zinc was
the failure of Kazakhstan's
nonferrous metals industry to
reach planned production goals.
He reported increases in the
production of these vital
metals which were well below
the increases planned for the
entire USSR (see table above).
Contributing factors appear to
have been a low level of mine
and smelter operating efficien-
cy, failure to complete new
construction on schedule, a
large labor turnover, and poor
administration throughout the
republic's Ministry of Non-
ferrous Metallurgy.
The Kazakh SSR now uses
only 2 percent of its total
hydroelectric power potential.
Hydroelectric power complexes
have been developed in recent
years on the Irtish River at
Ust Kamenogorsk and Ust Bukh-
tarma. The thermoelectric
power stations being constructed
at Ust Kamenogorsk and Tashkent,
as well as other places, will
determine the location and
promote the growth of new
industries..
Agriculture
In Soviet agriculture
during the past two years,
Kazakhstan has assumed a rapid-
ly increasing importance, since
approximately half the "new
lands" area lies within the
northern and western areas of
the republic. The bountiful
harvest in these areas last
year was all that prevented
Soviet grain production from
seriously declining as a result
of the drought suffered in
western Russia and the Ukraine.
The Russians have been
planning major irrigation proj-
ects throughout Kazakhstan for
a long time, realizing that the
successful industrial and agri-
cultural development of the
area, where land and climate
resemble the American West,
depends on adequate water
supplies. However, it is
economically not feasible to
extend the irrigation projects
to the wheat fields of the "new
lands" area in Kazakhstan.
Transportation
Along with emphasizing
agriculture and minerals, Moscow
is planning to complete by the
end of 1957 over 2,000 kilo-
meters of a rail network de-
signed to aid in the rapid
development of the new lands
and to transport grain and
other agricultural products
from the producing areas. The
rail. lines will provide exten-
sive coverage in an east-west
direction and also connect the
Transsiberian Railroad with the
recently completed South Siberian
Railroad.
Tough most of the construc-
tion is to be narrow gauge, it
will, along with construction
of roads in the area, provide
increased accessibility through-
out northwestern Kazakhstan.
By the end of 1957, 26,000
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CURRENT INTELLIGENCE WEEKLY SUMMARY
15 September 1E155
i
Magnitogors
kilometers of roads are planned
to be constructed in the area,
of which 700 kilometers are to
be completed by 1 January 1956.
The 1955 construction represents
approximately one half the
total planned for the entire
USSR.
Population
As a direct result of
Kazakhstan's industrial develop-
ment and the new agricultural
program, important changes have
been made in the ethnographic
composition of the republic.
In 1939 native Kazakhs comprised
slightly over half of the inhab-
itants, then numbering 6,100,000,
today they are in a minority of
the republic's 8,500,000 people.
Slavs (Great Russian, Ukrainian
or Belorussian) now constitute
a majority. They have emigrated
to Kazakhstan, partly under
SDUTH S\BEa\/
Copper
Balhhash .
' Lake
Balkhash
KAZAKHSTAN
I "New Lands" Area
Railroad
Railroad, planned or projected
government pressure, in response
to the demand for skilled labor,
technicians and administrators
in industrial expansion and as
settlers in the virgin lands.
With this European emigra-
tion continuing on a massive
scale, the Slav majority in
Kazakhstan is becoming steadily
greater. Already there are signs
that this Slavic numerical
superiority is affecting the
choice of individuals as leaders
and top administrators in the
republic.
Political Leadership
Kazakhstan is a territorial-
administrative unit originally
created to "protect" and "further"
the interests of the native
Kazakh peoples. Its party
apparatus had been headed since
1946 by the Kazakh, Zhumabai
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CURRENT INTELLIGENCE WEEKLY,SUMMARY
15 September 1955
Shayakhmetov. In February 1954
Shayakhmetov, described by N.S.
Khrushchev as "a weak leader
for such a great republic,"-was
replaced by all-Union party
presidium candidate P.K. Pono-
marenko. Shaya:khmetov's second-,
in-command was replaced at the
same time by L.I. Brezhnev, an
experienced party troubleshooter.
These changes were the result of
the Kremlin's dissatisfaction
with the Kazakh leadership's
handling of the republic's agri-
cultural program.,
Continued skepticism con-
cerning the capabilities of
native Kazakh leaders is re-
flected in the selection of
Brezhnev to replace Ponomarenko
when the latter was transferred
to Warsaw as Soviet ambassador
in May 1955 and the filling of
Brezhnev's old slot with another
Russian, I.D. Yakovlev, formerly
party first secretary of Novo-
sibirsk Oblast in the Russian-
Republic (RSFSR).
The government administra-
tion has undergone a radical re-
shuffling since the Ponomarenko-
Brezhnev regimes took over the
party reins. Only four of the
25 members of the republic's
Council of Ministers in office
in February 1954 hold the same
positions today. In the course
of reassignment and replacement,
the number of Slavs was ::increased
until today they., constitute about
half the Counci 1 of Minist +rs.' and
head, among others, the.: Mini"str,ies
of Agriculture, State Farms, Non-
ferrous Metallurgy, Communica-
tions, Motor Transport and High-
ways, and the State Planning
Committee and Committee-of State
Security. . -
At the Oblast level, where
government and party administra-
tion and control have a more
immediate impact on the people,
native politicians still hold
the bulk of the posts. Even
here, however, there have been
a number of reassignments and.
replacements.
F.A. Mamonov, a candidate
member of the all-Union party's
central committee and a former
party first secretary of Astrakhan
Oblast in the RSFSR, was assigned
as mayor of the Kazakh capital,
Alma Ata, and the Kokchetav and
Semipalatinsk Oblast party first
secretaries were replaced by
former Oblast secretaries from
the Ukraine, M.G. Roginets and
S.M. Novikov. Roginets served
in Kokchetav Oblast only a short
time and was then promoted on
,28 June 1955 to head the re-
public's important Ministry of
State Farms. In this post,
Roginets has primary administra-
tive responsibility for carrying
out the "new lands" agricultural
program.
The assignment to leading
posts in Kazakhstan of Brezhnev,
who had earlier served in the
Ukraine, and Roginets and Novi-
1cov, recently transferred from
there, suggests that Khrushchev
is intending to utilize experience
gained in his old. bailiwick in
furthering the agricultural
and industrial development of
Kazakhstan. There does not,
however, appear to be any
intention Of turning the Kazakh
SSR completely over to former
Ukrainian party people; I.D.
Yakovlev, the new second secre-
tary in Kazakhstan, does not
seem to have had any connections
with the Ukraine.
In the past, the Soviet
readers have tried to employ
native politicians as much as
possible in order to make the
Kremlin's control more palatable.
The present trend in Kazakhstan
away from native leaders may be
a temporary expedient made
necessary by the scope and com-
plexity of the problems in-
volved in both the new agri-
cultural program and the devel-
opment. of industry. It may
be, however, that the changed
ethnographic composition of the
republic will require Slavs for
effective leadership from now
on. (Prepared jointly 25X1
wit
CONFIDENTIAL
PART III PATt tRNS AND PERSPECTIVES Page 13 of 13
Declassified in Part - Sanitized Copy Approved for Release 2012/06/22 : CIA-RDP79-00927A000600090001-8