CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A002000030001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 55
• Document Creation Date: December 20, 2016
• Document Release Date: June 30, 2006
• Sequence Number: 1
• Publication Date: October 27, 1999
• Content Type: SUMMARY

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CONFIDENTIAL
URRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 50
OCI NO, 5643/58
13 November 1958
/
DATE
: '^ 70_
AUTH
NEXT REVIEW DATE:
^ DECLASSIFIED
CLASS. CHANGED TOE
DOCUMENT NO.
NO CHANGE IN CLASS. ^
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
State Dept. review completed
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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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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
T 11 E W E E K I N B R I E F
OF IMMEDIATE INTEREST
USSR THREATENS WESTERN POSITION IN BERLIN . . . . . . Page
Khrushchev's threat on 10 November to "revise" the
international status of Berlin presages a period of mount-
ing tension in Germany during which the USSR will proba-
bly take steps to transfer to the East German regime So-
viet authority in Berlin derived from quadripartite agree-
ments. A new juridical basis for the presence of Soviet
troops in East Germany would be established. These ac-
tions would be designed to force the West to deal with
the Ulbricht regime in order to maintain Western access
to Berlin. Bonn has hinted it might consider severing
relations with Moscow if the USR abrogate the
four-power agreement on Berlin.
MIDDLE EAST DEVELOPMENTS . . . . . . . . . . . . . . . . . Page
King Husayn has used the plane incident to whip-up
patriotic sentiment for himself. His propaganda may
backfire if he presses charges against the UAR in the UN,
however, since his plane did not in fact have clearance
for its flight. In Iraq the roundup. of pro-UAR elements
has continued. Israel remains alert to area developments,
and new incidents may occur in perennial trouble spots
along the Israeli-Syrian border and around the Mount Sco-
pus area of Jerusalem. In the Sudan, the pro-Western
government is still reported considering forceful action
to curb opposition and subversion if it does not succeed
in strengthening its-hand by parliamentary means. Area
developments have apparently left Nasir depressed and
frustrated.
SOVIET POSITION IN GENEVA CONFERENCES . . . . .
Page 6
Moscow continues after two weeks of negotiations at
Geneva on-a nuclear test cessation, to maintain its basic
insistence on an immediate, permanent, and unconditional
agreement. A new Soviet suggestion--designed to appear
as a concession to the West--proposes that an agreement
on cessation should at least be drafted before discus-
sion of a control system. Moscow apparently has no im-
mediate intention of breaking off the talks. In the
talks on measures to prevent surprise attack, chief So-
viet delegate Kuznetsov has insisted that this subject
is "organically linked" with broader disarmament issues.
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CONFIDENTIAL
CURRENT INTELLIGENCE WEEKLY SUMMARY
PART I (continued)
ARGENTINE POLITICAL CRISIS . . . . . . . . . . . . . . . Page 7
Argentine President Frondizi?s suspension of con-
stitutional guarantees for 30 days on 10 November springs
from his determination to push forward his oil policy and
to crack down on Peronista and Communist agitation. His
action, which was precipitated by the petroleum workers'
strike demanding cancellation of government oil develop-
ment contracts with American firms, increases his depend-
ence on the armed forces. The military backed Frondizi
during an abortive coup attempt on 12 November, which
was apparently encouraged by the spreading labor unrest. 25X1
NOTES AND COMMENTS
ALGERIA . . . . . . . . . . .
.. Page 1
Premier de Gaulle's plan to work out a permanent Al-
gerian settlement with the Algerian deputies to be elected
to the French National Assembly on 30 November has'been
undercut by the conspicuous absence of nationalist Moslem
and liberal European candidates. The inability and unwill-
ingness of "all political tendencies" to present themselves
in the face of indirect French Army and settler opposition
and of rebel intimidation may force De Gaulle to seek another
mechanism for a settlement. 25X1
TAIWAN STRAIT SITUATION . . . . . . . . . . . . . . . . . Page 2
The Chinese Communists have outlined a massive propa-
ganda campaign to rationalize Peiping's avoidance of hos-
tilities with the United States in the Taiwan Strait area.
A Nationalist official has stated that although no "deals"
will be made with the Communists by those now in control,
certain "fringe elements" might negotiate if by some "re-
mote" event they were brought to power. The military pic-
ture is one of outward relative calm, although Peiping
continues to maintain strong forces in the strait area.
POLITICAL CRISIS IN JAPAN . . . . . . . . . . . . . . . . Page 3
Japanese Prime Minister Kishi's prestige has been
damaged and his control of the ruling Liberal-Democratic
party possibly weakened by the parliamentary crisis aris-
ing from attempts to railroad through the Diet a contro-
versial bill to strengthen police powers, The Socialists
are boycotting the Diet, parliamentary deliberations are
CONFIDONTIAL
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
PART II (continued)
at a standstill, and there is nationwide opposition to
the government's tactics in seeking passage of the bill.
PAKISTAN . . . . . . . . . . . . . . . . . . . . . . . . . Page 4
The military regime in Pakistan is giving priority
to those reform measures which are likely to maintain
the popular impression of rapid progress. Enthusiasm
over the regime's "clean-up" campaign during the first
month of martial law has begun to wane, and the govern-
ment is under increasing pressure to demonstrate con-
tinuing achievement. Political elements, especially
in East Pakistan, are planning to resume limited ac-
tivity.
INDIAN PARLIAMENT FACES CONTROVERSIAL ISSUES . . . . . . . Page 5 25X1
The session of the Indian Parliament opening on 17
November is likely to be highlighted by discussions of
controversial issues on which the Congress party is find-
ing it increasingly difficult to defend itself. In addi-
tion to such chronic problems as lagging food production,
five-year-plan finances, and party rifts in several key
states, government leaders may be challenged on three
especially explosive questions--the situation in Commu-
nist-governed Kerala State, the linguistic problem in
Bombay State, and an old government financial scandal in-
volving V. K. Krishna Menon. 25X1
ELECTIONS SCHEDULED IN NEPAL . . . . . . . . . . . . . . . Page 6
King Mahendra has set Nepal's first parliamentary
elections in its history for 18 February 1959. Voting
for a lower house of 109 members will extend over 45
days. The parliament is to operate under the terms of
a new constitution presented on 2 November for the King's
approval. If political agitation gets out of hand, how-
ever, the King is likely to postpone the elections. There
is also to be an upper house appointed by the King.F___1 25X1
RENEWED INFLATION IN SOUTH KOREA . . . . . . . . . . . . . Page 7
The progress of South Korea's financial stabiliza-
tion program has been halted by a sudden increase of cur-
rency in circulation, resulting in a 6.5-percent rise in
the wholesale price index in September and October. In-
creased bank credits and doubled wages for all govern-
ment and, military personnel are primarily responsible,
but poor fiscal operations and unrealistic budget plan-
ning also are to blame. Further inflation is probable
for the next few months at least.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
PART II (continued)
SINO-SOVIET BLOC ECONOMIC OFFENSIVE IN INDONESIA . . . . . Page 8
Indonesia has accepted about $200,000,000 worth of
Sino-Soviet bloc economic aid offers since late 1957. In
addition the bloc has agreed to deliver by 1959 at least
$170,000,000 worth of military equipment and has sent at
least 270 economic technicians and about 170 military
specialists to Indonesia. Indonesian trade with the bloc
in 1958 probably will surpass the previous peak level of
$74,000,000 attained in 1955, and significant contracts
for future trade apparently are now being concluded.
CATHOLICS IN NORTH VIETNAM . . . . . . . . . . . . . . . . Page
Hanoi's efforts to acquire greater control over its
outspoken Catholic minority have vacillated between con-
ciliation and harshness, sometimes leading to armed
clashes. The regime's recent expulsion of four of the
20 foreign priests in the country is a move to strengthen
the state-sponsored church.
OBSERVERS REFUTE PEIPING'S AGRICULTURAL CLAIMS . . . . . Page 10
Observations of recent visitors to China and Pei-
ping's own policies with respect to food and cloth ra-
tioning confirm earlier analyses that Communist China's
statements about its "amazing" increases in agricultural
production are exaggerated. Although good weather and a
massive effort in the countryside undoubtedly brought
about substantial increases in most agricultural products
this year, most of the regime's claims seem out of touch
with reality.
THE YUGOSLAV DISPUTE WITH THE SINO-SOVIET BLOC . .
Neither side in the dispute between Yugoslavia and
the Sino-Soviet bloc appears willing to let mutual re-
criminations subside. Speculation that a "truce" was
on the horizon has not been borne out by events. Basic
ideological divergencies outweigh those factors that
could lead to an accommodation.
. Page 11
. . . . . . . . . . . . . . . Page
Additional reports now confirm a resurgence of anti-
regime hostility in Rumania during the first six months
of 1958, particularly on the part of peasants and indus-
trial workers. This apparently prompted the Rumanian lead-
ership to expand what was to have been a fairly routine
crackdown on the party and government bureaucracy.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
PART II (continued)
USSR SEEKS TO INCREASE EXPORTS TO WESTERN EUROPE . . . .
The USSR, which must augment its foreign-exchange
earnings in order to acquire Western equipment with
which to enlarge its chemical industry, is finding it
increasingly difficult to expand exports to Western Eu-
rope. The volume of trade among free world countries
this year has been generally lower, but European coun-
tries are reluctant to buy more from the USSR at the ex-
pense of trade with traditional suppliers.
COMMUNIST CLANDESTINE ACTIVITY IN WEST GERMANY .
. Page 15
25X1
. Page 16
Bonn government officials are apprehensive over the
inability of the federal police authorities to control
Communist underground activities and have used two re-
cent disclosures of Communist operations to illustrate
the need for increased security measures for West Ger-
many. While they constitute no immediate threat to the
security of the Federal Republic, Communist activities,
both espionage and propaganda operations, seem to be on
25X1
FINNISH CABINET UNDER POLITICAL ATTACK . . . . . . . . . . Page 17
Finland's two-month-old, five-party coalition gov-
ernment, headed by veteran Social Democrat Karl August
Fagerholm, is being attacked by the two opposition par-
ties and is under pressure from the USSR. It is also
strongly criticized from within by elements of the Agrar-
ian party, who assert that their party is best able to
maintain good relations with the USSR. Fagerholm's fall
would probably bring in an Agrarian-led government which
would be either a minority cabinet dependent on Communist
parliamentary su port or a ma'orit overnment including
the Communists.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
PART II (continued)
SPANISH SOCIALISTS INCLINING TOWARD JOINT ACTION WITH
COMMUNISTS . . . . . . . . . . . . . . . . . . . . . . . Page 18
Spanish Socialist leaders in exile are under increas-
ing pressure from their followers in Spain to permit col-
laboration with the Communists in peaceful strikes and
demonstrations in order to avoid losing the initiative to
the Communists. With benefits of the 1956 wage boosts
wiped out by steadily rising living costs, such joint ac-
tion, particularly with Anarchist party participation,
could lead to unprecedented worker agitation in the com-
ing months.
PATTERNS AND PERSPECTIVES
PEIPING'S HARD-LINE FOREIGN POLICY . . . . . . . . . . . . Page 1
Behind Communist China's present foreign policy
posture apparently is the belief that an atmosphere of
tension at this time will induce peoples of non-Commu-
nist countries to exert pressure on their governments
in favor of a "wholesale" change in attitude toward recog-
nition of the Peiping regime. The Communists are attempt-
ing to exert both political and military pressure on the
United States without clashing with American military
forces in the Taiwan Strait area, they appear gratified
by the trend of international opinion on the issue. They
probably will try to keep their foreign policy sufficient-
ly flexible so as not to alienate some of the sympathizers
they won in the course of the Taiwan Strait crisis.
THE FRENCH PARLIAMENTARY ELECTIONS . . . . . . . . . . . . Page
The first National Assembly of the Fifth Republic
will be elected on 23 and 30 November under new regula-
tions laid down by Premier de Gaulle. The new voting
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
PART III (continued)
procedures will probably reduce Communist representa-
tion, and De Gaulle's refusal to let his name be drawn
into the campaign has upset rightist hopes for sweeping
the country with a Gaullist "National'List." The impact
of the elections will be drastically reduced, however,
if, as the present trend suggests, the representatives
elected in Algeria will not command sufficient respect
among the Moslems to be able t negotiate a workable
adjustment of the Algerian problem.
NASIR AND THE COMMUNIST PARTIES IN THE UAR . . . . . . . . Page 8
Nasir this year has initiated legal and administra-
tive measures to control the UAR4s Communist parties,
which, although illegal, have retained a semiovert status,
at least in the Syrian region. For the time being he is
avoiding a direct police crackdown
e same me, in extending is
influence in the Arab states and North Africa, Nasir has
accepted pol,tica1 support from local Communists and taken
part in the activities of international Communist-front
groups.
WESTERN EUROPEAN ATTITUDES TOWARD THE UNITED NATIONS . . . Page 11
There is genuine concern among Western European pow-
ers--particularly those with colonies--over the growing
power of what they consider a politically immature voting
majority in the UN General Assembly. Nevertheless West-
ern Europeans generally see the United Nations as a perma-
nent feature of international life, useful, among other
things, for "educating" the lesser developed countries
to their international 'responsibilities. Most Western
European members would like to see the UN economic as-
sistance programs broadened, believing that multilateral
aid through the UN best offsets direct Soviet aid.
SINO-SOVIET BLOC ACTIVITIES IN GREECE . . . . . . . . . . Page 14
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CONE__ENT1AL
Khrushchev's threats on 10
November to "revise" the inter-
national status of Berlin pres-
age a period of mounting ten-
sion in Germany. During this
period the USSR will probably
take a series of steps to trans-
fer to the East German regime
Soviet authority in Berlin de-
rived from quadripartite agree-
ments. A new juridical basis
for the presence of Soviet
troops in East Germany would be
established.
Khrushchev declared that
the Western powers, by violating
the "Potsdam Agreement"--notably
by sanctioning the remilitariza-
tion of West Germany--had for-
feited their right to remain
in West Berlin, and he indicated
that the USSR would hand over
its remaining functions to
East Germany. He further de-
clared that any attack on East
Germany would be considered an
attack on the USSR itself. He
gave no indication, however, of
how or when the USSR planned to
hand over its functions. Soviet
Foreign Minister Gromyko on 11
November said this would not
happen immediately but would
not be long delayed. Further,
a Soviet Foreign Ministry offi-
cial informed American Ambas-
sador Thompson that German prob-
lems should be dealt with on a
step-by-step basis.
The Soviet actions would
be designed to enhance East Ger-
man sovereignty, thus urd_erlin-
ing the Soviet contention that
there are two Germanies and, by
invoking the threat of a block-
ade, to force the West to deal
with the Ulbricht regime. A
broader purpose may be to fur-
ther increase world tension with
a "western Quemoy" in order to
strengthen bloc unity against
the common enemy and to block
West German attempts to estab-
lish normal relations with the
East European countries, par-
ticularly Poland. Further, the
WEST GERMANY- BERLIN
COMMUNICATION ROUTES
West German = Autobahn - Highway East German
checkpoints: - Railroad checkpoints:
Railroad A Railroad
0 Highway o M1LU ^ Highway
move is designed to undercut
forthcoming West German proposals
regarding a four-power confer-
ence on German reunification.
Moscow's move at this time
will strengthen the hand of the
Ulbricht regime against popular
unrest stemming from the sudden
CONFIDENTIAL
PART I OF IMMEDIATE INTEREST
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Greater
Berlin
olm
o irkenwerder
Hohen
uendorf
~'~uB rally
i)ulec
change in over-all policy from
a "hard line'.' to one of conces-
sions to certain elements of
the populace. As a result of
concessions to physicians, in-
dustrial workers were consider-
ing work slowdowns to pres-
sure the regime into improving
their own conditions.
Moreover, the flow of ref-
ugees to the West, although
somewhat reduced, has continued.
During October, more than 19,000
East Germans, including many
intellectuals and technicians,
fled to the West, approximately
75 percent through West Berlin.
A sealing off of West Berlin
would thus greatly diminish ref-
ugee losses.
Autobahn
Highway
+- Railroad
--~ Railroad (elevated)
Subway
In a press conference on
12 November, East German Premier
Grotewohl, referring to the pos-
sibility of a withdrawal of
Soviet troops from Germany,
stated that he understood Khru-
shchev's speech raised such a
possibility, "naturally" on the
premise that the other powers
took the same steps. This sug-
gests that East German officials
may depart for Moscow in the
near future to negotiate a new
agreement along these lines,
perhaps after the forthcoming
elections of 16 November
Moscow might transfer its
membership in the Berlin Air
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Safety Center to the East Ger-
mans, thus confronting the West
with a situation in which it
would be required either to
deal with East German officials
or fly without guarantees of
safety. However, the East Ger-
mans are not now believed to
be in a position to exert ef-
fective control of flights in
the corridor and they apparent-
ly do not possess the trained
personnel to take over all the
Soviet positions at this time.
West German officials be-
lieve that Khrushchev's speech
is aimed at testing the firmness
of the Western resolve to re-
main in Berlin and at exerting
pressure on German public opin-
ion to accept direct political
talks with East Germany. French
and British foreign affairs
officials have strongly rejected
any unilateral abrogation of
the Potsdam Agreement, and the
West German press chief on 12
November hinted that Bonn might
consider severing its relations
with Moscow if the USSR abro-
gated the four-power status of
Berlin.
Increased harassment of
West Berlin and Allied and West
German access to it is now like-
ly. Various measures to in-
hibit traffic on the lifeline
to Berlin could be taken by
the USSR or East Germany, and
the East Germans could move to
seal off West Berlin by impos-
ing border restrictions and
halting municipal transport.
Although West Berlin municipal
officials report that there
is no indication of public dis-
quiet in the city, they feel
that acceptance of East German
control over highway access to
Berlin would be an "intolerable
situation." British officials
in Berlin, however, warn of
the danger of a "self-imposed"
blockade if the Western powers
refuse to accept East German
control over access to Berlin.
King Husayn has used the
incident involving his plane
to make effective propaganda
arousing sympathy and indigna-
tion among royalist elements.
However, it does not appear
that the incident has produced
more than a temporary lift. It
seems possible that if Husayn
presses charges against the UAR
in the United Nations, the re-
sult may actually be damaging,
since it has been confirmed
that clearance for the King's
flight was not received from
the UAR and that Damascus is
thus technically in the right
in the matter. UN Secretary
General Hammarskjold has strongly
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CURRENT INTELLIGENCE WEEKLY SUMMARY
advised the Jordanian Govern-
ment to let the matter drop; at
the same time, he has suggested
to Nasir that the UAR apologize
to Husayn, despite the apparent
correctness of its legal posi-
tion.
Husayn now plans to delay
his trip for about two weeks.
Prime Minister Rifai is urging
him to postpone the trip until
next spring. Rifai, who now
fears he may be blamed for the
blundering over the flight
clearance, had earlier expressed
a belief that Jordan's security
situation would be sufficiently
improved by mid-1959 that mar-
tial law could be lifted then--
CYPRUS
(U. K.)
Latakii
Baniya
Tripol'
LEBAN
MEDITERRANEAN BEIRUT
SEA ~~SiBo
Haifa
ISRAE
Tel Aviv}Jaffa
t Said
CAIR Suez
j SINAI
Oil pipeline
Railroad
Main motor road
U A N
(EGYPT)
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although authoritarian govern-
ment would continue.
Iraq
The roundup of pro-UAR ele-
ments is continuing in Iraq.
The Baath party, several of
whose members have been arrested
or dismissed from their jobs,
reportedly has decided that its
tactic of avoiding active op-
position to the Qasim regime is
not working out as planned, and
has determined to be more active
both in criticism of the gov-
ernment's failure to live up
to its early promises and
in combating Communist-
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organized street demonstrations.
A clash between Baathist and
Communist elements on 10 Novem-
ber seems to have been the first
product of the new Baathist line.
Israel
The Israelis have remained
alert to developments; they ap-
pear to be somewhat relieved
that King Husayn's presence in
Jordan may stabilize the situa-
tion there temporarily. At the
same time, however, they are
pressing to extend their con-
subversion and obstructive op-
position tactics when Parlia-
ment opens on 17 November.
The desire of Khalil to take
some kind of forceful action
is known in Khartoum, and op-
position elements are already
accusing Western powers of sup-
porting or inspiring such a
move.
The immediate danger which
threatens the government on the
opening of Parliament is an
attack on its acceptance of
American economic aid and of
British military assistance.
trol over portions of the Is- Should the opposition be suc-
raeli-Syrian demilitarized zone cessful in obtaining a rejec-
and are seeking to ship new tion of the British arms offer
arms to their enclave on Mount
Scopus, near Jerusalem. Both
these issues are perennial
sources of trouble, and the
Mount Scopus problem in partic-
ular could result in a long
wrangle with Jordan. It was in
connection with an incident
near Scopus that a Canadian UN
officer was killed earlier this
year.
The Israelis are not re-
ported to have taken any large-
scale measures in preparation
for trouble, but their mobil-
ization cadre appears to have
been called up, and reserve
vehicles are reported to have
been on alert since 7 November.
Members of Prime Minister
Khalil's pro-Western government
are still considering ways and
or of the American aid program,
;new offers in both these fields
are likely to be made when a
Soviet delegation arrives in
Khartoum on 20 November.
Area developments, especial-
ly the possibility of Israeli
action against Jordan and the
anti-UAR moves inside Iraq, ap-
pear to have left Nasir at
least temporarily depressed
and frustrated. Nasir claims
to be convinced that Communists
will win out in Iraq, since
other elements there are too
weak, in his opinion. He
continues to believe that the
Western powers are constantly
working against him in the area,
and he is concerned by what he
conceives to be further evidence
of Western support for Israel.
At the same time, Nasir has
reiterated his belief that the
means of curbing UAR-supported IUAR is not overly committed to
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CURRENT INTELLIGENCE WEEKLY SUMMARY
the Soviet Union economical-
ly, and he has given the
impression to American ob-
servers that a further UAR-
Soviet deal of some kind may
be upcoming.
SOVIET POSITION IN GENEVA CONFERENCES
Moscow continues, after
two weeks of negotiations at
Geneva on a nuclear test cessa-
tion, to maintain its basic in-
sistence on an immediate, per-
manent, and unconditional agree-
ment. A new Soviet suggestion--
designed to appear as a conces-
sion to the West--proposes that
an agreement on cessation should
at least be drafted before dis-
cussion of control system.
This would be followed by the
drafting of provisions "concern-
ing the organization of the con-
trol system," including the
structure and functions of a
control organ and system based
on the report of the technical
experts prepared last summer,
and then by the listing of or-
ganizational and other prepara-
tory measures to be taken after
signing. The agreement would
then be signed.
Thus, while ostensibly
meeting the Western objection
to the original Soviet agenda
proposal, the new proposal would
seem to require informal agree-
ment on a draft on cessation of
tests before discussion of con-
trols. The Soviet delegation
clearly indicated that Moscow
envisaged an agreement which
would include only a general
directive for establishment of
a control organ, details of
which would be taken up in a
separate agreement to be nego-
tiated sometime in the future.
Although the agenda pro-
posal accomplishes little to-
ward breaking the deadlock at
the talks, its very issuance
may indicate that Moscow is
seeking a talking point on which
to launch discussion of its own
proposal for an unconditional
test-cessation agreement. It
also shows that the Kremlin
probably has no immediate in-
tention of breaking off the
talks.
The Soviet delegation was
outwardly unruffled by the pub-
lic announcement by the United
States that Russia had continued
testing after the 31 October
opening session. Moscow both
publicly and privately reiterated
its 30 October official state-
ment that it would continue
tests as long as the West con- 25X1
tinued to "wreck agreement" for
a permanent unconditional to
ban.
At the sixth session, So-
viet representative Tsarapkin
attacked Western attempts to
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CURRENT INTELLIGENCE WEEKLY SUMMARY
link "the subjective conditions"
embodied in President Eisen-
hower's 22 August statement with
any test-cessation agreement.
Tsarapkin warned that the Soviet
delegation would never acquiesce
to any conditional agreement.
In the concurrent Geneva
talks on measures to prevent
surprise attack, chief Soviet
delegate Kuznetsov has insisted
that this subject is "organical-
ly linked" with broader disarma-
ment issues such as a ban on nu-
clear weapons, liquidation of
foreign bases, and reduction of
conventional armaments and forces.
Moscow, hoping to use this line
to counter what it probably be-
lieves will be attractive West-
ern proposals, assigned First
Deputy Foreign Minister Kuzne-
system would provide a would-
be aggressor with intelligence
data of value in launching such
an attack.
The remarks of other bloc
delegates at the third session
support Soviet attempts to in-
ject what are essentially polit-
ical issues into the technical
talks. The Czech delegate ex-
pressed concern that the peoples
of the world will be disap-
pointed if the talks are limited
to technical, "academic" ques-
tions of weapons and inspection.
He then linked technical prob-
lems with policies of "certain
great powers" which endanger
the peace by such means as fly-
ing aircraft laden with nuclear
weapons.
tsov, a diplomat of considerable ; The Albanian delegate
tactical skill and experience, brought up the Rapacki demili- -
to handle this difficult nego- ' tarization plan, describing it as
tiating task, t being "urgent and realistic."
At the second session, on
11 November, Kuznetsov insisted
that an inspection system not
combined with definite disarma-
ment measures would promote rath-
er than hinder the prospects
of a surprise attack, since the
Kuznetsov then deprecated West-
ern insistence on separating
technical discussions on sur-
prise attack from political
considerations as implying that
the experts were so naive as to
be unaware of the simple facts
in this regard.
Argentine President Fron-
dizi's suspension of constitu-
tional guarantees for 30 days
on 11 November springs from his
determination to push forward
his oil policy and to crack
down on Peronista and Communist
agitation. His action, which
was precipitated by the petro-
leum workers' strike demanding
cancellation of government oil
development contracts with Amer-
ican firms, increases his depend-
ence on the armed forces. The
military backed Frondizi during
an abortive coup attempt on 12
November, which was apparently
encouraged by the spreading
labor unrest.
Gomez' in-
v v m n in the plot, as al-
leged by some reports, is not
clear, but both houses of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
Congress were summoned on 13
November to consider impeach-
ing him for refusing to name
the plotters. For some weeks
Gomez has urged a check on
Peronista and Communist agita-
tion, which Frondizi denounced
in his 9 November warning to
the strikers.
Frondizi's charges that
the strike was part of a sub-
versive plan by Communists and
Peronistas to create unrest and
restore a dictatorship have
some basis in fact. The petro-
leum workers' association is
headed by a Peronista and in-
filtrated by Communists. While
the oil workers' strike is es-
sentially political, challeng-
ing a key government policy,
both Communists and Peronistas
have been exploiting high liv-
ing costs to gain support for
their agitation.
Recent Communist agitation
has emphasized three major
themes attacking the govern-
ment. On the cost-of-living
issue, propaganda has been sup-
plemented with Communist ef-
forts to organize neighborhood
protest committees. Communists
were active in promoting vio-
lence and demonstrations pro-
testing the Frondizi-sponsored
law permitting private universi-
ties. They have denounced as
a sellout to "imperialism" the
government petroleum contracts
with Western firms--mostly US--
for more than $400,000,000 worth
of goods and services and con-
tinuing negotiations for double
that amount. They say these
are unnecessary in view of bloc
offers.
The Soviet offer of last
July to supply $100,000,000
worth of petroleum equipment
on credit was formalized in an
agreement signed in Moscow on
27 October calling for payment
over ten years at 2.5 percent.
No specific purchases were men-
tioned in the contract or have
been confirmed by Argentine
official sources.
The Peronistas, who along
with the Communists backed Fron-
dizi's election last February,
declared on 9 November a policy
of open opposition to the
administration. This will
weaken Frondizi's influence
among labor and increase his
reliance on the armed forces
to counter aggressive labor
tactics. He seems still firmly
in control of the situation,
but labor unrest will probably
continue.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
Premier de Gaulle's plan
to work out a permanent Algeri-
an settlement with the Algerian
deputies to be elected to the
French National Assembly on 28
November has been undercut by
the conspicuous absence of na-
tionalist Moslem and liberal
European candidates. The in-
ability and unwillingness of
"all political tendencies" to
present themselves in the face
of indirect French Army and
settler opposition and of rebel
intimidation may force De Gaulle
to seek another mechanism for
a settlement.
The vast majority of both
129 Moslem and 68 European
candidates on the 52 lists filed
before the 9 November deadline
profess support for the army
and settler line of integration
of Algeria with France. The be-
lated entrance of five Social-
ist lists, which comprise most
of the "opposition," was appar-
ently instigated by Socialist
party leaders in Paris.
Although the army ostensi-
bly obeyed De Gaulle's order
to get out of politics and en-
sure free elections, the lib-
eral ex-mayor of Algiers, Jacques
Chevallier, has charged the
army with rigging the elections.
A high French civil official
admits that the army generals
acting as prefects "discour-
aged," if not actually pro-
hibited, candidates they did
not favor.
Ambassador Hoppenot, head
of the commission supervising
the elections, expressed "dis-
appointment" to the American
consul general on 8 November,
stating that the Moslems were
afraid of both the army and the
Algerian National Liberation
Front (FLN). Although he saw
no hope of the kind of electoral
competition De Gaulle envisaged,
Hoppenot ruled out the possibil-
ity of postponing the elections.
A postponement, he explained,
would be violently attacked by
the Europeans and would force
De Gaulle to explain that the
action was necessary because of
army and rebel pressure.
De Gaulle, who reportedly
was disturbed over the lack of
"desirable" condidates, now may
have to modify his plan of nego-
tiating with duly elected Al-
gerian representatives. Impend-
ing municipal elections may pro-
duce a better balanced Moslem
representation, but these do not
come until April.
As an alternative the pre-
mier may attempt new overtures
to the FLN, but political consid-
erations in France will force
him to avoid any gesture imply-
ing recognition of this body as
chief spokesman for Algerian
Moslems. Contacts reportedly
continue with the FLN despite
its rejection of De Gaulle's in-
vitation to come to Paris to
arrange a cease-fire. In any
event, hopes for an early solu-
tion for Algeria have dimmed
considerably, and the election
of "hand-picked" Algerian repre-
sentatives in the French Nation- 25X1
al Assembly will almost certain-
ly complicate a reasonable solu-
tion.
CONFIDENTIAL
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
Speaking before the Chinese
Communist party's central com-
mittee propaganda department on
10 November, Premier and polit-
buro member Chou En-lai outlined
a massive propaganda campaign
to rationalize Peiping's avoid-
ance of hostilities with the
United States in the Taiwan
Strait area. Chou linked the
"paper tiger" theme with an "ex-
planation" of Peiping's position
on the situation, citing a se-
ries of events from World War
II to the present to "prove"
Mao's thesis that imperialist
nations are really hollow shells
which will inevitably collapse.
The Chinese Communists are de-
scribing the "paper tiger" the-
ory as "our sharpest ideological
weapon in the struggle against
imperialism" and are stressing
that the demise of the West is
inevitable, although it may be
some time in coming.
In a recent con-
versation with an
American official,
Chinese Nationalist
Vice Foreign Minis-
ter Chou Shu-kai
said that if forced
to choose between
acceptance of "two
Chinas" and a "deal"
with the Chinese
Communists, the in-
dividuals now "con-
stituting" the Na-
tionalist Government
would "of course
choose the lesser of
two evils--two Chi-
nas. "
Chou said, how-
ever, that this ap-
plied only to the
present dominant ma-
jority. He thought
that some National-
ist "fringe elements"
might choose differ-
ently, and that in
the "remote" event of a coup
d'etat or some other event bring-
ing them to power, Nationalist
China might conclude such a
deal. Chou did not elaborate
on the identity of the "fringe
elements," and his remarks may
have been intended to influence
the United States away from adop-
tion of a "two Chinas" policy.
Peiping resumed its warn-
ings to the United States for
alleged violations of its 12-
mile territorial waters. The
"41st serious warning;' issued
on 12 November, charged that on
11 November an American C-54
transport "intruded" over the
Kwangtung Province coastal area
and an F-86D jet fighter "in-
truded" territorial air space
in the Matsu area. This is the
first warning since 22 October,
when the 39th and 40th were is-
sued.
O Nationalist hold
Selected railroad
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No significant developments
have been reflected in Communist
military activity during the
week. Artillery firing on "odd"
days has been light and sporadic.
The Nationalists on 11 November
alleged that a Communist loud-
speaker on Amoy had announced
that "the cease-fire on even
days is hereby abolished. Shell-
ing is possible any day." There
was no official comment from
Peiping,and Communist guns were
silent on 12 November. The Na-
tionalists have withdrawn con-
firmation of the loud-speaker
broadcast, and the Taiwan Defense
Command considers it highly un-
likely that the broadcast ac-
tually occurred as reported.
Further examination of
Chinese Communist and National-
ist chemical warfare capabili-
ties has revealed that the Na-
tionalists do not have any
capability for manufacturing
toxic agents or any facility
for filling CW shells. The US
has not given the Nationalists
any such munitions since World
War II,and the Japanese did not
leave any?toxic agents on Tai-
wan when they left the island.
The Chinese Communist Army has
a small capability to employ
CW toxic agents based on a lim-
ited manufacturing capability.
Despite continuing bad
weather in the Taiwan Strait,
the Chinese Nationalists de-
livered approximately 10,300
tons of supplies to Chinmen
between 1 and 10 November and
are scheduling an additional
7,000 tons for delivery between
10 and 17 November. The Taiwan
Defense Command comments that
this is more than doubleE the
normal tonnage required. Re-
cent shipments have included
heavy equipment, tanks, gun
tubes, and heavy maintenance
and construction items. "
Japanese Prime Minister
Kishi's prestige has been dam-
aged and his control of the
ruling Liberal-Democratic party
possibly weakened by the par-
liamentary crisis arising from
attempts to railroad through
the Diet a, controversial bill
to strengthen police powers.
The Socialists are boycotting
the Diet and have stimulated
nationwide opposition to the
government's admittedly "ir-
regular" tactics in seeking
passage of the bill.
Surprisingly strong Social-
ist opposition, reinforced by
nationwide labor walkouts and
unusually vitriolic press de-
nunciation of the government's
handling of the bill, caught
conservative leaders unaware.
A subsequent move by the ruling
party to extend the special
Diet session by questionable
means in order to permit the
bill to remain under active
consideration only increased
criticism of the government.
The Socialists are charg-
ing that the bill would restore
the prewar "police state" and
realize that its passage would
severely limit their ability
to use mass demonstrations,
labor walkouts, and extremist
tactics to gain support for
their parliamentary position.
Conversely, failure of the bill
would encourage greater use of
such tactics and weaken the
government's will and ability
to use the powers it now has
to curb leftist activities.
Kishi, recognizing his
vulnerability, has offered to
compromise on some provisions
of the bill and to delay its
consideration until the regular
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CURRENT INTELLIGENCE WEEKLY SUMMARY
session of the Diet in early
December. Socialist leaders,
on the other hand, have re-
jected these offers and insisted
that the bill be withdrawn com-
pletely. Continued refusal by
the Socialists to compromise
or resume Diet proceedings,
however, might result in loss
of public sympathy for their
position.
Socialist leaders believe
that if the bill can be defeated
Kishi will be dealt a serious
political blow, and that sim-
ilar tactics can be used a-
gainst negotiations with the
US to revise the security
treaty. Leaders within Kishi's
own party, including former
Prime Minister Ishibashi, are
criticizing his handling of the
bill and questioning his leader-
ship. While there is no im-
mediate danger of the govern-
ment's fall, the extent to which
the position of Kishi and the
conservatives has been jeopard-
ized may be revealed in the
elections to the upper house
and in a possible challenge to
Kishi for the party president
in the s rin of 1959.
The military regime in Pak-
istan under President Ayub is
giving priority to those re-
form measures which are likely
to maintain the popular impres-
sion of rapid progress made by
the new administration to date.
Initial enthusiasm over the re-
gime's "clean-up" campaign dur-
ing the first month of martial
law has begun to wane, and the
government is under increasing
pressure to demonstrate further
achievements. Meanwhile, polit-
ical elements are planning
covertly how they might resume
some form of limited activity.
Top civil administrators
have conceded that the regime's
lack of long-range objectives
and effective planning is mak-
ing it difficult to maintain
the pace of the "revolution."
Ayub is pressing a commission
of experts to produce a program
for immediate land reform,
which he regards as the most
urgent problem on the domestic
front. The regime has brushed
aside warnings that precipitate
action might upset the economy
and retard rather than increase
food production.
Members of the business
community in Karachi are ex-
pressing concern over the con-
tinuing standstill in commercial
activity. Businessmen, who were
hit hard by the stringent mar-
tial-law regulations and by
price controls, have largely
suspended operations until the
financial outlook becomes
clearer. Resultant shortages
of commodities and a return to
previous price levels have
moderated the initially favor-
able public reaction to the
military administration.
Signs of political activ-
ity are beginning to reappear,
although most politicians are
continuing to lie low for fear
of arrest. The Moslem League
is likely to be the first of
the now defunct parties to
resume operation, since it is
the only political organization
which finds some acceptance
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
among the armed services. In
East Pakistan, where the mili-
tary regime is likely to en-
counter more opposition, Moslem
League leaders have been meet-
ing to chart out policies for
the party to follow, possibly
in cooperation with the new
government.
Leftist elements have
been handicapped by the ar-
rest of key leaders of the
National Awami party and
the underground Communist
INDIAN PARLIAMENT FACES CONTROVERSIAL ISSUES
The session of the Indian
Parliament opening on 17 Novem-
ber is likely to be highlighted
by discussions of controversial
questions on which the Congress
party is finding it increasing-
ly difficult to defend itself.
In addition to such chronic
problems as lagging food pro-
duction, five-year-plan finances,
and party rifts in several key
states, government leaders may
be challenged on three poten-
tially explosive questions--
the situation in Communist-gov-
erned Kerala State, the linguis-
tic problem in Bombay State,
and a government financial
scandal involving V. K. Krishna
Menon.
An attempt in September by
the non-Communist opposition to
raise the question of maladmin-
istration in Kerala was ruled
out by the speaker. However,
this maneuver, which reflected
growing criticism of the Com-
munist government's handling of
civil disturbances in Kerala,
caused a stir in Parliament and
put the Communists on the de-
fensive at the national level.
Opposition sentiment remains
strong as a result of continued
strikes and repressive police
action in Kerala. The opportu-
nity to publicize Communist dif-
ficulties during the coming par-
liamentary session is almost
certain to be exploited by anti-
Communist elements.
Agitation in Bombay State
for a division of that region
into separate linguistic states
is again on the increase, rais-
ing the possibility that Parlia-
ment will be asked to reconsider
the two-year-old legislation
which, despite local resistance,
established Bombay as a large
unilingual state. Prime Minis-
ter Nehru, taking note in Sep-
tember of the increasing agita-
tion and deploring the use of
violent methods, implied that
he would not oppose parliamen-
tary action to amend the 1956
reorganization. Certain ele-
ments in the Congress high com-
mand are still firmly opposed
to a division of the state,
however, as indicated by the
recent decision of the national
executive to unite the separate
party branches in Bombay--long
organized along linguistic lines
--into a single state-wide or-
ganization.
Efforts may also be re-
newed during the coming parlia-
mentary session to discuss re-
ports that Krishna Menon, while
serving as India's high commis-
sioner in London in 1951, became
involved in a much-publicized
scandal over an Indian Govern-
ment purchase of jeeps in 1951
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
from a British firm.
ELECTIONS SCHEDULED IN NEPAL
Nepal is scheduled to con-
duct its first experiment with
a popularly elected government--
eight years after the revolu-
tion of 1950-51 which was to
bring democracy to the country.
King Mahendra announced on 9
November that elections to the
lower house of a new parliament
would begin on 18 February 1959.
These elections, for 107 of 109
seats, will extend over 45 days
because of Nepal's
rugged terrain and
the shortage of
trained personnel.
Elections for,the
additional two seats,
from constituencies
in remote western Ne-
pal, will be held
later.
In 1951 a Nepa-
lese revolutionary
movement, with some
Indian support, de-
posed a family of
hereditary prime min-
isters which had
ruled for a century.
Since none of the po-
litical parties was
able to establish a
stable government
after the revolution, a series
of provisional governments, at
times quasi-parliamentary in
form and sometimes involving
direct rule by the King, have
administered the country for
the past eight years.
On 1 February 1958, King
Mahendra announced a firm five-
point program leading to nation-
al elections. This program has
proceeded fairly smoothly in its
mechanical aspects, and irre-
sponsible political activity
has been curbed.
The elections will be held
under a new constitution drafted
by Nepalese and foreign experts.
An upper house will be chosen
by the King and his advisers.
The prime minister and his cab-
inet will be responsible to par-
liament. The King presumably
will retain ultimate power. He
must pass on the constitution,
which was presented to him on
2 November, prior to its pro-
mulgation.
At present, only the mod-
erate socialist Nepali Congress
party, led by former Home Min-
ister B. P. Koirala, seems to
have enough strength to win a
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parliamentary majority. Little
is known about the following of
the Communist party, but it is
believed to be strong in some
locations. K. I. Singh, former
prime minister ousted by Mahen-
dra in November 1957 and now
leader of the United Democratic
party, apparently has popular
appeal outside Katmandu.
Should political agitation
in the next three months become
the elections.
irresponsible or appear to
threaten the interests of the
King, he is likely to postpone
The progress of South Ko-
rea's financial stabilization
program has been halted by a
sudden increase of currency in
circulation, resulting in a 6.5-
percent rise in the wholesale
price index in September and
October. Increased bank credits
and doubled wages for all gov-
ernment and military personnel
are primarily responsible, but
poor fiscal operations and un-
realistic budget planning are
also to blame. Inflation prob-
ably will continue for the next
few months at least.
The stabilization program,
implemented in mid-1957, suc-
ceeded for the first time in
ten years in rolling back prices,
which had risen to more than
230 times their 1947 level. A
controlled expansion of currency
in circulation--generally ef-
fective except for some overex-
pansion in December 1957--to-
gether with increased arrivals
of American aid goods and a
modest industrial build-up, con-
tributed to the program's suc-
cess.
South Korean economic of-
ficials attempted to limit cur-
rency in circulation to $320,-
000,000 during 1958. By the
end of September, however, this
limit had been exceeded by $12,-
000,000, with traditional year-
end expansion still to come.
Planned increases in bank cred-
its and crop loans, apparent
overestimation by government
officials of tax revenue, and
a drop in aid goods strongly
suggest that the deterioration
will continue well into 1959.
Minister of Finance Kim
Hyon-.chol has stated that his
government is determined to de-
press prices by tightening con-
trols on the money supply. The
average wholesale price index
for the last six months of 1958,
however, is threatening to ex-
ceed the level at which, accord-
ing to a South Korean agree-
ment with the United States in
September 1955, the exchange
rate must be revised.
In late 1957, the South
Korean Government was able to
control the price level so as
not to require a revision of the
exchange rate. Conditions this
year are far less favorable,
and Minister Kim has not out-
lined his specific intentions
for monetary controls. One
Korean press report states,
however, that Seoul is about to
seek a revision of the 1955 25X1
agreement to assure that the
exchange rate is not altered
the end of this year.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SINO-SOVIET BLOC ECONOMIC OFFENSIVE IN INDONESIA
Since the Sino-Soviet bloc
economic drive in Indonesia
got under way seriously in late
1957, Djakarta has accepted
about $200,000,000 worth of
bloc economic aid offers and,
in addition, the bloc has a-
greed to deliver by 1959 at
least $170,000,000 worth of
military equipment. At least
270 bloc economic technicians
are now in Indonesia, and about
170 military specialists are
assembling bloc equipment and
training Indonesians in its
use.
The bloc is also intensi-
fying a trade drive in Indo-
nesia. Reports indicate that
Indonesian trade with the bloc
in 1958 will surpass the pre-
vious peak level of $74,000,000
in 1955. Reduced Indonesian
economic activity this year
will increase the importance of
bloc trade.
Bloc arms deliveries are
continuing according to schedule.
Materiel supplied thus far has
consisted mainly of land arms
and aircraft, but some naval
equipment--motor torpedo boats
and landing craft--may also
have been delivered by Soviet
merchant ships. In October
four subchasers were turned
over to the Indonesian Navy.
The USSR has preferred to
have other members of the bloc
act as suppliers of these arms.
Although Poland and Czechoslo-
vakia extended military credits
to Djakarta, some of the equip-
ment purchased under these agree-
ments has been of Soviet origin.
Communist China for
its part has facili-
tated the delivery
of aircraft to Indo-
nesia by permitting
overflights.
The bloc already
has signed $140,000,-
000 worth of contracts
--65 percent of total
bloc economic aid of-
fered Indonesia--to
supply a wide range
of goods and assist-
ance. Under these
credits, Poland and
the USSR are supplying
36 ships, China has
shipped rice and tex-
tiles, and East Ger-
many and Czechslo-
vakia are construct-
ing a sugar factory
and a tire plant. The USSR, re-
sponsible for one half of total
bloc economic aid, is making
foreign exchange available and
is conducting transport and
geological surveys.
Communist China continues
to be Indonesia's major bloc
trading partner, and this trade
is expanding. Peiping is sup-
plying rice for the first time--
about 20 percent of the 800,000
tons of rice being imported
this year. By extending credits,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
Peiping also is assuring it-
self of an important share of
Indonesia's textile market.
Bloc purchases are pri-
marily limited to rubber, Indo-
nesia's major export. During
the first half of this year
China and the USSR purchased
12 percent of Indonesia's rub-
ber exports, compared with 7
percent in 1957. Communist
China and Czechoslovakia alone
reportedly have already agreed
to buy at least 10 percent of
Indonesia's estimated rubber
exports in 1958.
CATHOLICS IN NORTH VIETNAM
The recent expulsion: of
four of the 20 foreign Catholic
priests in North Vietnam for
acts "contrary to law and harm-
ful to security" is the latest
move in Hanoi's efforts to con-
trol the country's Catholic
minority. One of the four, a
Canadian, has already arrived
in Hong Kong after traveling
through Communist China.
The expulsions follow re-
cent efforts by Hanoi to ac-
commodate the Catholics. The
state-sponsored "Committee of
Patriotic and Peace-loving
Catholics" permitted requiem
masses and the tolling of bells
following the death of Pope
Pius XII, and on 30 October
extended "greetings" to the
new pontiff. This contrasts
markedly with the policy of
the Chinese Communists, who,
except for charging American
collusion in the papal elec-
tion,, have remained silent on
all recent Vatican develop-
ments. North Vietnam, however,
with a proportionately larger
Catholic minority than China,
may have wanted to avoid any
action which might provoke op-
position requiring harsh re-
pression.
The nearly 400,000 Cath-
olics in North Vietnam appear
to be among the most vocal
critics of the regime and the
most militant in their refusal
to conform. There were major
outbreaks in Nghe An Province
between Catholics and govern-
ment troops in 1956 and 1957,
and
some 2,000 Catholic you s
clashed with police last March.
Hanoi's policy has alter-
nated between conciliation and
harsh repression, and it has
used both friendly gestures
and warnings to discourage
antiregime demonstrations.
After the army's suppression
of a three-day uprising in a
Catholic area in November 1956,
Hanoi reverted to a particular-
ly conciliatory line. Pro-Com-
munist Catholic leaders and
newly formed lay groups were
encouraged to hold special
services for Catholic "comrades"
killed in the war against the
French. Cadres were directed
to appoint Catholics to village
agricultural executive commit-
tees and to restore and repair
churches "requisitioned" during
the land-reform program.
Six months later, however,
Hanoi began denouncing individ-
ual priests in the press, ac-
cusing the church of "political
activities prejudicial to the
policy of the state and the
laws of the country."
Hanoi has sought to pro-
mote a "reliable" Vietnamese
clergy which could influence
the Catholic laity to support
the regime, and, in their ef-
forts to promote the "Committee
of Patriotic and Peace-loving
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Catholics," the Communists have
allowed Catholics a certain
amount of freedom. The regime
now may feel that the time is
ripe to weed out the political
liabilities represented by the
few remaining foreign priests
and thereby to enhance the ef-
fectiveness of the state-spon-
sored church as a propa anda
arm of the government.
Observations of recent
visitors to China and Peiping's
own policies with respect to
food and cloth rationing do
not bear out Communist China's
statements about its "amazing"
increases in agricultural pro-
duction. Although good weather
and a massive effort in the
countryside undoubtedly brought
about substantial increases in
most agricultural products this
year, most of the regime's
claims seem out of touch with
reality.
Peiping says this year's
grain output will reach 350,-
000,000 tons, 90 percent more
than last year and about equal
to the combined output of North
America, Australia, Africa, and
Western Europe. Cotton produc-
tion, Peiping says, will more
than double last year's, thus
enabling China to outstrip the
United States in this field.
In the past, Peiping's
crop "estimates" have been high
early in the year--although not
as high as this year's claims--
and have been subsequently trimmed
downward. This year, how-
ever, the regime thus far shows
no inclination to back down from
early predictions, which in some
cases are actually being in-
COMMUNIST CHINA'S AGRICULTURAL PRODUCTION
(MILLION METRIC TONS)
1956
PRODUCTION
1957
PRODUCTION
195!
PUN
Total grain
182.5
185.0
196.0
350.0
Peanuts
3.3
2.521
3.03
6.0
Rapeseed
.92
.85
1.15
1.35
Soybeans
10.2
10.05
10.44
12.5
Cotton
1.44
1.64
1.75
3.5
Wheat
25.0
27.0
39.45
Rice
82.4
84.9
160.0
Tobacco
.399
.251
.768
Sugar
.870
.850
2.0
Potatoes
21.8
20.3
105.0
Draft animals
87.3
83.5
90.22
(MILLION HEAD)
Hogs
(MILLION HEAD)
* Formulated before announcement of "giant leap forward"
SECRET
creased. Most of the
claims seem to be
based on generaliza-
tions drawn from par-
ticularly favorable
experimental plots.
The leaders in Pei-
ping give the in-
flated statistics the
widest publicity.
They may be counting
on the new commune
system, which will
almost completely
separate the farmer
from the results of
his labor, to obscure
the great disparity
between claims and
what is actually pro-
duced.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
many of the Innovations in farm
techniques being applied to
small experimental plots are
impractical and are designed
mostly to dramatize potential
productivity of the land.
some of the
techniques being pushed by the
authorities lack scientific
planning and may even have harm-
ful effects on the soil in fu-
ture years. It has become a
sort of national game,
to compete for
the highest yield on experimen-
tal plots which are then pro-
jected as nationwide achieve-
ments.
THE YUGOSLAV DISPUTE WITH THE SINO-SOVIET BLOC
There has been recent
speculation that some restraint
would materialize in the dis-
pute between Yugoslavia and
the Sino-Soviet blocs This
feeling, generated largely by
Tito?s apparently conciliatory
remarks in mid-October and the
subsequent arrival in Belgrade
of a long-postponed delegation
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PART II NOTES AND COMMENTS Page 11 of 19
The regime's failure sub-
stantially to increase food and
cloth rations supports the view
that claims are grossly exag-
gerated. Peiping has had to
issue several directives calling
for "shock" procurement drives
to spur lagging procurement of
agricultural goods--steps that
scarcely would be necessary if
granaries were bulging with
surplus crops.
output of grain and fiber
equal to the combined pro-
duction of the rest of
Improved weather conditions,
a tremendous effort in water
conservancy work, and intensified
farming practices this year un-
doubtedly increased agricultural
production substantially, but
this no longer satisfies Pei-
ping. Production goals set for
next year, for example, if
fulfilled, would make China's
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
of Soviet war veterans, has not
been borne out. Yugoslav For-
eign Secretary Koca Popovic
declared on 29 October to Selwyn
Lloyd in London that the present
hostile Soviet attitude toward
Yugoslavia would "last for a
protracted period."
Although the participants
in the dispute continue to pay
lip service to a desire to im-
prove relations, none yet ap-
pears willing to let the re-
criminations subside. Basic
ideological divergencies remain
and outweigh those factors that
could point to a modus vivendi.
Soviet Premier Khrushchev, in
a speech on 10 November, said
he would strive to develop
friendly relations with Yugosla-
via "along the state line" and
to continue trade when mutually
advantageous. He added, how-
ever, that the bloc would wage
an "irreconcilable struggle"
against Yugoslav "revisionism,"
and said be believed Yugoslavia's
leaders were becoming enemies
of the working class.
Attacks of varying inten-
sity against Belgrade's foreign
policies continue, and public
condemnation of Yugoslav "re-
visionism" is again prominent
in bloc propaganda. Most
recently, the Yugoslavs have
been sharply condemned in sev-
eral speeches made by satellite
leaders on the 41st anniversary
of the Russian revolution.
Yugoslav diplomats attending
ceremonies in East Berlin, Sofia,
and Tirana walked out in protest.
The Yugoslavs have ap-
parently managed to maintain
some influence among the satel-
lites. Furthermore, the Yugo-
slav party's new monthly re-
view, Socialism, first published
in early October, made it clear
that Belgrade had in no way
modified the heretical concepts
put forth at the Yugoslav party
congress last April, which
precipitated the present,dis-
pute. Yugoslav party secretary
Vukmanovic-Tempo, in an attack
particularly on the Chinese,
Bulgarian, and Albanian roles
in the anti-Yugoslav campaign,
on 9 October reaffirmed Bel-
grade's belief that Yugoslav
views on the "development of
socialism" will triumph.
Yugoslavia's voluminous
contribution to the polemics
shows that Belgrade has no in-
tention of ignoring bloc chal-
lenges to its position. The
Rumanian-Czech party-state
declaration of 22 October and
an earlier East German - Bul-
garian statement have been con-
demned by the Yugoslavs as
efforts to establish a pattern
for attacking Yugoslavia. Bel-
grade has linked these decla-
rations with the Khrushchev-
Mao communiqud of last August
calling for the eradication of
Yugoslav "revisionism."
Albanian attacks on Yugo-
slav minority policies have
recently increased in intensity.
Albanian Premier Shehu declared
on 26 October that Tirana will
attack the "bloody Tito regime"
until'Albanians in Yugoslavia
are granted the "same elementary
rights as any other minority
in a bourgeois state." The
Yugoslavs have countered with
accusations that the Albanians
are threatening the peace, and
Belgrade has sharply attacked
them for harassing Yugoslav
diplomats in Tirana. Grotewohl's
recent attack on Yugoslav pol-
icies and Belgrade's sharp re-
joinder precipitated a marked
deterioration in Yugoslav -
East German relations. While
these charges appear sufficient
to warrant a break in diplomatic
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CURRENT INTELLIGENCE WEEKLY SUMMARY
relations, apparently neither
Yugoslavia nor the bloc de-
sires such a development at
this time.
Abandoning its customary
defensive attitude in the dis-
pute, Yugoslavia has taken the
initiative on two issues which
could easily expand differences
with the bloc. An article in
the Yugoslav: press has welcomed
the granting of the Nobel Prize
to Boris Pasternak, who is de-
scribed as one of the most
"significant of living Soviet
poets," and as having "great
merits in preserving Russian
epic traditions." This atti-
tude reportedly has caused
enough concern for Moscow to
request Belgrade not to pub-
lish Pasternak's book in Yugo-
slavia.
Belgrade also has attacked
the Chinese Communists' commune
drive, probably hoping to pro-
mote its own system of communes
in order to embarrass.Peiping.
In contrast to the Yugoslav
system, the Chinese drive is
described by Belgrade's prop- 25X1
aganda media as "truly a terror
exercised over the Chinese peas-
antry.
Additional reports now
confirm a resurgence of anti-
regime hostility in Rumania
during the first six months of
1956, particularly among peas-
ants and industrial workers.
This apparently prompted the
Rumanian leadership to expand,
in late summer and early fall,
what was to have been a routine
crackdown on the party and
government bureaucracy.
peasants in the region
of Brasov last June resisted
the efforts of officials of the
Ministry of Agriculture to col-
lect wheat. When the officials
called in the security police,
the peasants burned the wheat
and, in some cases, the har-
vesting machinery. The wealth-
ier peasants and others who had
been members of prewar politi-
cal parties, fearing retalia-
tion, reportedly fled to the
surrounding mountains.
workers in Brasov agitated for
increased salaries, improved
working and living conditions,
and an end to "Stakhanovite"
production methods. Regional
party and union officials, con-
trary to usual practice, re-
portedly went to the factory
where the protests had origi-
nated and organized meetings
for the purpose of bringing
the grievances to the atten-
tion of regime officials in
Bucharest.
When police, presumably
acting with the cognizance of
the Ministry of Interior, ar-
rested the organizers, the
workers reportedly seized the
factory buildings, demonstrated
in the city square, and called
on other workers in Brasov to
support their demands. The
local police, seriously under
strength since many of their
units had been sent to the
countryside the previous month,
were forced to release their
prisoners, and security troops
and militia from neighboring
cities had to be called in to
restore order.
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Popular unrest in the in-
dustrial and agricultural sec-
tors has been a continuing prob-
lem for the Rumanian regime,
and,prior to June of this year,
the regime has tended to follow
a conciliatory line when faced
with unrest or threats from
workers or peasants,
With the continuation of
unrest during the first half of
this year, however, the Rumanian
regime abandoned its equivocal
tactics and began cracking down.
Thus, the campaign launched at
the party plenum in June to re-
duce corruption and bureaucratic
overhead, and to overcome ideo-
logical backsliding among party
members and the intelligentsia;
was expanded to embrace workers
and other potentially dissident
elements of the population. Pos-
session of labor cards was
made mandatory for purposes of
employment, housing, and medical
care, and it was decided on 13
August not to hold the long-
scheduled congress of trade
unions until after the regime's
hand could be strengthened by
a reorganization of the trade
unions. More recently, it has
created "factory courts" em-
powered to impose fines and
other punishments, including
confiscation of property, for
nonfulfillment of production
quotas or negligence leading
to the breakdown of machinery.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The USSR, which must aug-
ment its foreign-exchange earn-
ings in order to expand its
chemical industry with Western
equipment, is finding it in-
creasingly difficult to expand
exports to Western Europe. The
volume of trade among free-world
countries this year has been
generally lower, but smaller
European countries are reluc-
tant to buy more from the USSR
at the expense of trade with
traditional suppliers. Both
Denmark and Italy have asked
that Moscow settle its import
surplus in convertible currency
rather than in Soviet goods,
and Belgium has stopped grant-
ing credits under its payments
agreement with the USSR, as
they had become a means for
financing a chronic import
surplus by the USSR.
Through polite threats,
Moscow is increasingly promot-
ing bilateral trade relations.
Western Europe countries often
are pressed either to switch
imports to the USSR in order
to reduce the trade credits
they hold there or else to se-
cure new Soviet orders. France,
"encouraged" by recent heavy
Soviet purchases of French equip-
ment, now may purchase up to
215,000 tons of Soviet wheat.
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The USSR promotes itself as a
reliable source of supply and
a stable market for goods not
influenced by cyclic economic
movements.
with Denmark and extended its
previous protocol,
25X1
25X1
In its negotiations with
the West European countries,
the USSR states that while its
purchases are expected to grow,
it will import from individual
countries only to the extent
that the supplier buys from
the Soviet Union. The USSR
has stressed, for example, that
Finland must either divert
purchases from the West to the
USSR in order to balance Mos-
cow's import surplus with Fin-
land, or else suffer a cut in
Soviet purchases, an act which
would affect the level of em-
ployment in Finland. Helsinki,
in order to maintain the level.
of its sales to the USSR, agreed
in September to buy Soviet fuels
and metals worth $15,000,000
for stockpiling.
The USSR in August ended
inconclusive trade negotiations
COMMUNIST CLANDESTINE ACTIVITY IN WEST GERMANY
Bonn government officials
have expressed increased appre-
hension over the inability of
the federal police authorities
to combat underground Communist
activities. Their concern has
been aroused by the discovery
of a serious case of espionage
in the West German armed forces
and the recent detection of
extensive Communist propaganda
activity in the industrialized
Rhine-Ruhr area. The volume of
Communist propaganda material
has increased markedly since
the beginning of the year, al-
though the federal police es-
timate that only about half the
illegal literature has been
confiscated.
Since the West German Com-
munist party (KPD) was banned
in August 1956, Communist sub-
versive-operations have been
directed to a'greater degree
from the East Zone and supported
by,an estimated $720,000 to
$960,000 a month. The volume
of illegal pamphlets and period-
icals is increasing each month.
About 345 titles were seized in
1958, and 1,340,000 individual
propaganda letters were confis-
cated from couriers traveling
from the East Zone during 1957.
About 166 illegal factory news-
papers are published in West
Germany.
The federal police have
arrested 870 Communist agents
for distributing illegal litera-
ture between August 1956 and
August 1958, and about 7,500
preliminary proceedings have
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PART II NOTES AND COMMENTS Page 16 of 19
vage its export trade with the
USSR, however, Denmark--faced
with agricultural surpluses in
which the USSR has indicated
an interest--is pressing pri-
vate oil companies to accept
Soviet petroleum.
The USSR must increase its
foreign-exchange earnings in
order to expand its chemical
industry with free-world equip-
ment. This program, announced
in May, has already resulted
in contracts for more than
$40,000,000 worth of Western
plants. Soviet delegations
visiting the United States have
indicated an interest in pur-
chasing up to $50,000,000 worth
of machinery in the United 25X1
States alone, but they have
hinted that financing might
present a problem.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
been started. In a case that
has been called the most seri-
ous example of Communist in-
filtration in the West German
armed forces, Lieutenant Com-
mander Horst Ludwig and several
other agents were recently ar-
rested on the charge of spying
for the USSR. In addition, 37
Communists have been seized for
underground activities in the
Rhine-Ruhr area in the largest
police action against the KPD
since the party was banned.
Bonn government leaders
have used this subversion as
justification for increasing
security measures. Defense Min-
ister Strauss has called for
the creation of a central gov-
FINNISH CABINET UNDER POLITICAL ATTACK
Finland's two-month-old,
five-party coalition government,
headed by the veteran Social
Democrat Karl August Fagerhoim,
is being attacked by the two
opposition parties, and is un-
der pressure from the USSR.
It is also strongly criticized
from within by elements in the
Agrarian party, who assert that
their party is best able to.
maintain good relations with
the USSR.
The Communist-
front Finnish People's
Democratic League
(SKDL), resentful of
its exclusion from
the government after
the July parliamen-
tary elections made
it the largest party,
has openly questioned
the sincerity of the
government's neutral-
ity policy, while the
Soviet press has
criticized its.: "right.
1st" character. Fin-
land's economic de- 80109 3 /90906 9
ernmeat agency for psychologi-
cal defense, the purpose of
which would be to control Com-
munist infiltration in the
armed forces as well as in po-
litical and economic circles.
Since the apprehension of the
37 Communists in the Ruhr, In-
terior Minister Schroeder has
called for increased security
forces and has proposed a con-
stitutional amendment which
would give the Bonn government
special powers to deal with na-
tional emergencies, including
subversive activities in West
Germany and aggression from
abroad. This proposal, however,
has been attacked by the oppo-
sition Social Democratic party
as too sweeping'
.
pendence on the USSR and its
high unemployment make the
country particularly vulner-
able to Soviet commercial pres-
sure, and some officials are
seriously disturbed that Mos-
cow has ignored a second at-
tempt by the Finns to start
talks for a 1959 trade agree-
ment.
The Agrarian party's par-
ticipation in the cabinet has
not prevented the party from
denouncing the government's
FINNISH DIET
JULY 1958 QUADRENNIAL ELECTIONS
GOVERNMENT COALITION
,V, 0E CENTER CENTER
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domestic policy and criticizing
its "ineptitude" in handling
relations with the USSR. Both
President Kekkonen and the rad-
ical element within the Agrar-
ian party are reportedly ac-
tively seeking to replace the
incumbent cabinet with one more
acceptable to the USSR.
Fagerholm's difficulties
in keeping his government in
power are increased by the
feuds within the Social Demo-
cratic party and Finland?s cen-
tral trade union organization,
the Confederation of Trade
Unions (SAK). SAK is con-
trolled by the dissident, anti-
government Social Democrats,
and in late October the "regu-
lar" Social Democrats organized
a rival trade union organiza-
tion. Since the Communists
comprise an estimated 40 to 45
percent of SAK's membership,
further defections would en-
able the Communists to play an
increasingly decisive role.
A meeting of the Social
Democratic party council has
been set for 29 November in
one more effort to end the
parallel quarrels. Prime Min-
ister Fagerholm has recently
conferred with the Social Demo-
cratic opposition leaders and
the chairman of SAK, presum-
ably in an effort to re-estab-
lish unity negotiations, and
there are rumors that cabinet
posts will be offered the dis-
sident Social Democrats. In
his effort to save his govern-
ment, Fagerholm will also make
special efforts to avoid of-
fending the USSR.
Agrarian efforts to un-
seat Fagerholm, however, are
likely to continue. His fall,
ostensibly on domestic issues,
would result in difficult and
long-drawn-out negotiations.
Unless new elections are called
by the President, the most
likely result would be an
Agrarian-led government--either
a minority cabinet dependent on
Communist (SKDL) and opposition
Social Democratic parliamentary
support, or a majority government
including those groups.
SPANISH SOCIALISTS INCLINING TOWARD JOINT ACTION WITH COMMUNISTS
Spanish Socialist leaders
in exile in southern France
are under increasing pressure
from their followers in Spain
to permit collaboration with
the Communists in peaceful
strikes and demonstrations in
order to avoid losing the ini-
tiative to the Communists.
With benefits of the 1956 wage
boost wiped out by steadily
rising living costs, such joint
action, particularly with An-
archist party participation,
could lead to unprecedented
worker agitation in the coming
months.
Socialists in Spain be-
lieve that the Spanish Commu-
nist party has a big advantage
over the clandestine Socialist
and Anarchist parties and labor
unions because of its foreign
financial support and its clan-
destine radio station, and be-
cause the regime has given the
Communists extensive publicity
by assailing every popular dem-
onstration as Communist insti-
gated. They feel that Social-
ist press criticism of the Com-
munists only plays into the
hands of Franco.
The Toulouse congress of
the Socialist party in exile
last August refused to approve
a request for collaboration
with the Communists. The Amer-
ican Embassy in Madrid never-
theless expects a policy of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
limited rapprochement because
of the intensifying economic
pressure on the workers. The
cost of living in Madrid, for
instance, has risen 39.6 per-
cent in less than two years.
Recent reports from the Ameri-
can consul in Valencia reveal
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considerable sentiment among
the Anarchists also for cooper-
ation with the Communists.
Collaboration by these three
groups, even if limited in
scope, could intensify worker
protest action over the next
six months.
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13 November 1958
PATTERNS AND PERSPECTIVES
PEIPING'S HARD-LINE FOREIGN POLICY
The Chinese Communists have
adopted a new hard approach to
advance their basic foreign pol-
icy goals--international accept-
ance, reduction of US influence
on Western governments, and ero-
sion of US authority in the Far
East. They apparently expect
that an atmosphere of tension
at this time will induce peoples
of non-Communist countries to
exert pressure on their govern-
ments in favor of a "wholesale"
change in attitude toward recog-
nition of the eight-year-old
Peiping regime.
In their current effort,
however, the Chinese Communist
leaders have not returned tc
Stalin's policy of relegating
all non-Communist countries--
including the "noncommitted"--
to the sphere of the capitalist,
"enemy" camp. Peiping is highly
selective in applying its hard
tactics.
Moderate tactics apparently
now are considered to be useful
only after a "struggle" and dead
lock. On 8 August, a People's
Daily editorial provided clear
summation of this view of for-
eign affairs when it stated:
"Long historical experience has
proved it is necessary to strug-
gle resolutely against the im-
perialist aggressive bloc in
order to relax international ten-
sions and safeguard world peace."
The major factors in con-
ditioning the Chinese Communist
leaders to this hard-line policy
probably were a real sense of
irritation with the slow progress
of their previous somewhat con-
ciliatory policy, and the con-
viction that the USSR has raised
the bloc to a position of con-
siderable strength, while the
US has been subject to considera-
ble criticism from its allies.
Peiping tried the hard line in
July 1957, when it blasted the
Japanese Government for its re-
quirement that Chinese Commu-
nist delegates to a trade fair
be fingerprinted; Tsingtao was
then closed to Japanese shipping.
The Japanese indicated willing-
ness to reconsider the finger-
print issue, Tsingtao was re-
opened, and Peiping expressed
its willingness to discuss re-
patriation of Japanese nationals
and expanded trade.
Policy Toward US
In opening its "struggle"
with the US, Peiping apparently
worked to prepare-a position
from which it could exert both
political and military pressure
on the US without clashing with
American military forces. Com-
munist China's demand on 30 June
for resumption of the Sino-Amer-
ican ambassadorial talks sus-
pended last December was designed
to appear as an "ultimatum" and
to create the impression that
Peiping was leading from strength.
When Premier Chou En -lai stated
on 6 September that Peiping "is
ready" for talks, the Chinese
leaders were almost certainly
convinced that as a result of
their shelling of Chinmen and
the accompanying trend of inter-
national opinion, they were in
a strong negotiating position
vis-a-vis the US.
Chou's willingness to men-
tion the offshore islands as a
separate issue from Taiwan was
probably intended to be inter-
preted as a negotiating position,
in response to which the Commu-
nists apparently expected US
concessions. In the meantime
they appeared gratified by in-
ternational criticism of the US
position. and were encouraged
by signs of Nationalist pique
with the US.
The use of artillery for
the "political struggle" provided
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the Chinese Communist leaders
with a "safe" means of probing
US intentions regarding the de-
fense of the offshore islands.
They obviously did not desire
a "big" war and when Peiping
concluded that the US would de-
fend the islands, the Chinese
Communists began to modify their
statements which had implied a
direct military challenge to
the US. In contrast to the
People's Daily warning of 9
September g American convoy-
ing would "result in armed'.
clashes with China at any mo-
ment," the present line carries
no such threats; instead it
maintains Communist China's will-
ingness to negotiate "peaceful-
ly" and insists that the US
voluntarily recognize Peiping's
12-mile limit.
In his cease-fire order of
6 October, Defense Minister
Peng Te-huai did not threaten
to force the US out of the Tai-
wan Strait area and stated in
relatively mild language that
if American forces do not with-
draw quickly, "they will always
be on the defensive." Subse-
quent orders by Peng, despite
Peiping's improved military capa-
bility in the strait area, also
failed to specify direct retali-
ation against US naval vessels,
should convoying be resumed.
This line indicates that
the Chinese Communist leaders
are sensitive to the destruc-
tiveness of American nuclear
weapons. Prior to and early
in the Taiwan Strait crisis,
the Chinese Communists tried
to create the impression among
Western governments--particular-
ly the US--that China cannot be
"pushed around" merely because
it has no nuclear weapons. Lat-
er, however, Mao Tse-tung him-
self moderated Peiping's chal-
lenge to the US, stating in
late September that US atomic
war threats have alienated more
than 90 percent of the "people
of the whole world." According
to the People's Daily on 30
September, the peoples of the
world must shoulder the task
of "staying the hands of the
US aggressors against China."
The Chinese leaders, who
are reported to have become ap-
prehensive that the Nationalists
might use US atomic weapons
against the mainland, recognize
that a nuclear attack on China
would wreck Peiping's industrial-
ization program.
The Chinese Communist lead-
ers are also aware that since
they possess no effective deter-
rent to prevent a nuclear at-
tack on the mainland, success
of their policy toward the US
depends on Soviet support. A
I People's Daily editorial of
late September stated: "We know
very well the destructive power
of atomic weapons" and declared
that any American nuclear at-
tack on the mainland would re-
suit in an attack on the US "by
the same means." The passage
on retaliation was attributed
by the editorial to Khrushchev's
19 September letter to President
Eisenhower, suggesting that Com-
munist China does not possess
nuclear weapons of its own. Mao
Tse-tung, Liu Shao-chi, and
Chou En-lai have twice in the
past month publicly underscored
the "powerful support" Mos-
cow has provided in the Taiwan
Strait situation--support which
has been "very effective" in
"forcing the aggressors to think
hard about their fate."
Whether Khrushchev was at
all reluctant to be a partner
in Mao's plan for using artil-
lery to probe US intentions re-
garding the offshore islands is
a conjectural matter. In any
case, top Soviet military lead-
ers, including Marshal Malinov-
sky, are reported to have been
conducting military discussions
with Chinese military leaders
in Peiping at least eight days
prior to Khrushchev's arrival
there on 31 July.
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Policy Toward Yugoslavia
Peiping's desire to "strug-
gle" with Moscow's opponents
as well as its own has made it
a major protagonist of Khru-
shchev's efforts to restore his
control over and tighten dis-
cipline in the Soviet bloc. In
their effort against the Yugo-
slavs, the Chinese have been
moving with the USSR in avoid-
ing a break while attacking Bel-
grade's revisionism. The tone
of their attack, however, had
been sharper than that of any
bloc party, and the snub last
June of the departing Yugoslav
ambassador suggests that they
do not feel the need for retain-
ing the same degree of flexi-
bility in relations with Bel-
grade that Khrushchev continues
to seek for Moscow.
It is not clear at just
what point in mid-1957 Mao de-
cided that his own pronounce-
ments on intrabloc relations
should be brought into line with
the harder position then being
taken by Khrushchev. In any
case, by November 1957 Mao's
attacks against revisionism were
the sharpest of any made by bloc
leaders and his statement that
the Soviet Communist party, as
well as the Soviet state, must
lead the bloc was unique among
bloc leaders.
The fact that Tito and Go-
mulka.were questioning the hegem-
ony of Moscow was reason enough
for Mao to lend his prestige in
enforcing it. He was also anx-
ious to put an end to misrepre-
sentations of Chinese Communist
statements by Yugoslavs and
Poles, who tried to use Peiping
as a counterweight to Soviet
authority.
The Chinese Communists'
first important move against
Belgrade was to send only an
"observer" to the Yugoslav con-
gress last April in line with
the action of the USSR and most
of the satellites; Albania com-
pletely boycotted the congress.
Their second major move was a
sharp attack against Yugoslav
revisionism in the 5 May edi-
torial of the People's Daily.
Belgrade's 9 May KomunisT-_ae-
fense of the party's program
interpreted the Chinese attack
as a revival of the 1948 reso-
lution which expelled Yugoslavia
from the Cominform.
This apparently was not
Peiping's intention. The Chi-
nese editorial took Khrushchev's
line laid down at the July 1955
plenum in Moscow that while the
Cominform resolution was basi-
cally correct, the methods used
in implementing it, and the
1949 Cominform resolution, were
incorrect. Chinese Foreign
Minister Chen Yi on 10 May took
steps apparently designed to
dispel the impression that Pei-
ping's sharp condemnation of
Belgrade was political warfare
of the Cominform brand or that
it would lead to a break in dip-
lomatic relations between the
two countries. At the same
time he reserved China's right
to criticize Yugoslavia on ideo-
logical issues. A subsequent
Chinese attack stated that crit-
icism should be "political" as
well as ideological and depicted
Yugoslavia as sustained by US
aid and following Washington's
foreign policy. A similar pic-
ture had been outlined by Khru-
shchev earlier in April in terms
which were less primitive than
those used by the Chinese.
Policy Toward US Allies
Peiping is varying its new
hard-line approach toward gov-
ernments which "persist in their
unfriendly attitude toward Chi-
na." With some, it has virtual-
ly broken contacts; others it,
deliberately harasses.
Japan is a prime example
of a nation with which Peiping
has broken sharply. Despite
its tirade of personal abuse
including charges of "war
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criminal" directed against Ja-
pan's Premier Kishi following
his speech on -nonrecognition
of Communist China last January,
Peiping maintained the hope that
an exchange of trade missions
could be carried out which would
be tantamount to de facto recog-
nition. When Premier Kishi
stated on 9 April that the Japa-
nese Government could not guaran-
tee the sanctity of the Chinese
Communist flag should it be
flown over the prospective mis-
sions' headquarters, however,
Peiping responded with a bombast
of hostility culminating in com-
plete rupture of-all trade re-
lations.
The Chinese demand for a
"wholesale" change of attitude
on the part of Kishi is coupled
with a demand for a formal "apol-
ogy"--a position which has hard-
ened even previously sympathetic
Japanese businessmen against Com-
munist China. This approach has
not influenced Moscow's rela-
tions with Tokyo, and there is
no evidence to suggest the Chi-
nese Communists are pressing
for a tougher Soviet line.
The new look in relations
with Western nations--partic-
ularly with governments which
have supported the US position
on such issues as Taiwan and UN
membership--has resulted in pro-
grams of petty harassment. Such
a program is now being conducted
against the Dutch Embassy in
Peiping, where the Chinese staff
went "on strike" in protest
against the firing of two coolies.
The Dutch, who have been told
they are expected to "apologize"
for this action, are convinced
that Peiping's sharp demand
stems directly from Foreign Min-
ister Lun's public support of
Secretary Dulles' statement ab-
juring the use of force in the
Taiwan Strait situation.
The British, too, have had
ample opportunity to become in-
ured to periodic "unpleasant-
ness" in Peiping. Premier Chou
En-lai had warned last February
that "if Britain did not change
its two-faced attitude toward
China, Sino-British relations
would inevitably be adversely
affected." Peiping's pique
with London's "two Chinas" dec-
larations has not, however, led
to any major strain in Sino-
British relations.
Latin American and Middle
Eastern countries--the "colo-
nial, underdeveloped" areas--
have been approached with mod-
eration by Peiping, despite the
Western orientation of some of
these governments. Peiping is
clearly convinced nationalism
and anticolonial._ sentiment
can be exploited to advantage,
and it apparently hopes that
declining Chinese Nationalist
prestige will facilitate the
establishment of diplomatic re-
lations. However, Morocco's
decision to establish formal
relations with the Peiping re-
gime, announced on 31 October,
appears to have been facilitated
primarily by Soviet efforts in
Rabat.
Policy Toward Neutrals
"Peaceful coexistence" con-
tinues to be the theme which
underscores Peiping's relations
with neutral Asian nations,
which it hopes to make pro-Com-
munist. It is clear that Com-
munist China has not jettisoned
coexistence as a guide to for-
eign relations with regimes
which indicate some degree of
sympathy for Peiping.
The Chinese Communist lead-
ers' policy of treating Cam-
bodian Premier Sihanouk with
considerable deference was re-
warded on 22 July when Sihanouk
agreed to establish diplomatic
relations with Peiping. Siha-
nouk made his move despite
strong fears among many influ-
ential Cambodians that the step
would intensify Communist sub-
versive activity and jeopardize
continuation of American aid.
The sharp contrast in the Chi-
nese Communist approach toward
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13 November 1958
neutrals and toward the West
was made evident by Premier
Chou En-lai when he repeatedly
stressed China's peaceful in-
tentions toward Cambodia at a
time when the Communist shell-
ing of Chinmen was just begin-
ning.
Peiping's relations with
such countries as India and
Burma, however, have become
cool. The Chinese Communist
position is primarily condi-
tioned by the attitude of these
countries toward international
Communism and domestic Commu-
nists; Nehru has become more
critical and Ne Win is openly
antagonistic. The Chinese, who
have allowed border issues with
both countries to drag on, re-
cently administered a minor
diplomatic snub to Nehru during
his recent visit to Bhutan via
a Tibetan route. Continuing
Indian and Burmese support on
the Taiwan issue and on the So-
viet bid for a UN seat for Com-
munist China are factors which
will prevent Peiping from adopt-
ing an openly hostile attitude
toward these governments.
Prospects
Peiping will probably try
to keep its foreign policy suf-
ficiently flexible so as not
to alienate some of the sym-
pathizers it won in the course
of the Taiwan Strait crisis.
For example, the Chinese lead-
ers apparently believe that
they have made gains among UN
members, and that these gains
might be prejudiced by press-
ing too hard in the Taiwan
Strait situation.
slav campaign.
role in the bloc's anti-Yugo-
The Chinese Communists will
undoubtedly continue a leading
THE FRENCH PARLIAMENTARY ELECTIONS
The first National Assembly
of the Fifth Republic will be
elected on 23 and 30 November
under new regulations laid down
by Premier de Gaulle, who hopes
to secure a clear nonextremist
majority with which he can re-
build a strong republican France.
The new assembly, like its pred-
ecessor, is likely still to suf-
fer from a multiplicity of par-
ties, but under the new elec-
toral system, Communist strength
will probably be reduced and
the new deputies of the right
are likely to be more responsi-
ble politically than the ex-
treme rightists of the last
legislature.
New Electoral System
The proportional represen-
tation system which produced
three badly fragmented assem-
blies under the Fourth Republic
has been replaced by the single-
member district system charac-
teristic of the Third Republic.
A total of 546 seats, including
71 for Algeria and the Sahara,
will be filled in November.
Those overseas territories which,
under the new constitution,
choose to maintain their present
status or become departments
will be represented in the new
assembly by their holdover
deputies from the Fourth Republic
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CURRENT INTELLIGENCE WEEKLY SUMMARY
until new elections are sched-
uled.
On the first ballot--on
23 November--for the 465 seats
representing metropolitan France
and the 10 allotted the over-
seas departments (French Guiana,
Guadeloupe, Martinique, and
Reunion), candidates must re-
ceive a majority of the votes
cast in their districts to be
elected. Practically all the
districts are expected to have
recourse to a run-off election
the following week.
The new electoral law pro-
vision covering the
30 November run-offs
disqualifies all
first-round candi-
dates who fail to
receive 5 percent of
the votes and for-
bids the Third Re-
public's abusive
practice of introduc-
ing new party-alli-
ance compromise can-
didates, but it will
permit one candidate
to withdraw in favor
of another. A plural-
ity will be sufficient
to win in the second
round.
OUTGOING FRENCH NAT AL ASSEMBLY
(METROPOLITAN FRANCE ONLY)
COMMUNISTS
27%
handful of districts with con-
siderably less than this aver-
age, and there is some varia-
tion on the upper side in dense-
ly populated regions. Redis-
tricting has cut representation
for rural southern and western
France and increased that of the
urban and expanding north and
east. Gerrymandering has not
been a problem, and De Gaulle
is reported to have intervened
personally to assure fair re-
districting in the home areas
of two of his bitterest non-Com-
munist enemies--Radical Social-
ist former Premier Pierre Mendes-
France and left-wing Democratic
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RIGHTISTS*
66 12
RADICAL
SOCIALISTS
13%
Elections for the
71 Algerian and Saharan seats
will be confined to a single
vote for multimember lists on
30 November, or, in some iso-
lated areas, on 28 and 29 Novem-
ber. The list system was re-
tained in Algeria to secure rep-
resentation for the Moslems,
who are assured at least two
thirds of the seats. European
candidates, however, experienced
great difficulty in persuading
Moslems to present themselves
as running mates.
Metropolitan France has
been electorally reapportioned
on the basis of approximately
:33,000 inhabitants per district,
although a provision that no
department will have fewer than
two deputies has produced a
Resistance Union leader Francois
Mitterrand.
Role of the Parties
Candidates representing
all the major parties have filed,
although only the Communists
and Socialists plan to run in
all the districts. Most of the
other parties are concentrating
their efforts where they have
a chance of winning.
The Communists, Socialists,
Popular Republicans, Radical
Socialists, and Independents
are still the major parties.
Two new groups have appeared on
the left of center--a pro-Gaul-
list organization known as the
Center for Republican Reform
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(CRR) and an umbrella organiza-
tion including fellow-traveling
and non-Communist anti-Gaullist
groups called the Union of
Democratic Forces (UDF). On
the right of center, two par-
ties have Virtually disappeared
--the former Gaullist Social
Republican Group (GRS) and
Poujade's Union for French Fra-
ternity (UFF). In their place
are two new rightist parties--
the Soustelle-inspired pro-
Gaullist Union for a New Re-
public (UNR) and the smaller
Renovation and Fidelity group,
which is apparently organized
only in the Paris area.
In general, elections con-
ducted on the basis of a single-
member constituency rather than
on the list system emphasize
local issues and personalities
and tend to weaken party dis-
cipline. Thus, the changed elec-
toral system reduces the local
influence of the highly cen-
tralized parties--the Commu-
nists, Socialists, and Popular
Republicans--and favors the
looser knit, more individualis-
tic Radical Socialists and In-
dependents. Parties with large
numbers of popular mayors and
departmental councilors, par-
ticularly the Socialists and
Independents, are expected to
benefit. Political strongholds,
such as those of the Popular
Republicans on the eastern and
western frontiers of the coun-
try and of the Radical Social-
ists in the southwest, will
probably survive.
The new law is expected to
reduce the number of deputies
from the Communist party, which,
under proportional representa-
tion, won numerous seats in de-
partments where it was strong
but lacked a majority. The as-
sumption is that the non-Commu-
nist parties will unite on the
second ballot to block the elec-
tion of a strong Communist con-
tender, even though the Commu-
nist party retains much of its
former popular support. How-
ever, while many Communist
voters disobeyed party instruc-
tions in the constitutional
referendum, they may not do so
in an election where the choice
again involves traditional par-
ties.
De Gaulle's Position
All the parties except the
Communist and the Union of
Democratic Forces claim to be
pro-Gaullist, but Premier de
Gaulle himself has refused to
let his name be drawn into the
campaign or to allow any members
of his cabinet who are candi-
dates to campaign outside their
own districts. These limita-
tions particularly affect In-
formation Minister Jacques
Soustelle, who had favored a
system of voting by lists in
large districts on a winner-
take-all basis and who counted
on sweeping the field with a
Gaullist "National List" of
rightist candidates in each
district.
Since De Gaulle's acces-
sion to power, a new interest
in politics has appeared among
many former nonvoters. The
heavy registration of new voters
of all ages which preceded the
September constitutional refer-
endum is expected to carry over
and produce a heavy turnout in
the assembly elections. Soustel-
le's Union for a New Republic
and its allies expect to bene-
fit from this phenomenon.
Algeria and economic prob-
lems are virtually the only is-
sues on which party platforms
differ to any degree. In gen-
eral, the parties to the left
of center favor a negotiated
political settlement in Algeria
and emphasize the need for
greater economic benefits for
all French citizens. The right-
ist parties, on the other hand,
call for reduced governmental
intervention in economic affairs
and repeat their demands for
integration of Algeria with
France. De Gaulle apparently
hopes to secure a parliament
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13 November 1958
whose members will continue to
represent traditional French
rightist and leftist tendencies,
but who will be amenable to
the "arbitration" which he, as
first president of the Fifth
Republic, would exercise.
The significance'of these
elections will be greatly re-
duced, however, if De Gaulle's
plans for a relatively free
campaign in Algeria do not suc-
ceed. Because of the unwill-
ingness of influential Moslems
and liberal Europeans to run
for election, the premier may
be unable to achieve his hope
of negotiating a meaningful
settlement without the politi-
cally dangerous necessity of
recognizing the Algerian Lib-
eration Front as spokesman for
Algeria.
Techniques With the Communists
Although the Communist
parties in the UAR are illegal,
President Nasir tolerates their
existence. His efforts are
concentrated on limiting their
strength and preventing them
from establishing centers of
power from which they could
pose a serious threat. Nasir's
aim is to ensure the impotence
of the Communist parties in
Egypt and Syria while he uses
his "alliances" with Communist
countries for international
advantages.
To further his Arab "lib-
eration" movement and extend
his influence throughout the
Arab world and Africa, Nasir
accepts propaganda backing from
the Communist parties and takes
part in the activities of such
organizations as the Afro-Asian
Solidarity Committee and its
subgroups, in which bloc nation-
als and individual local Com-
munists play a major role. He
appears confident that he can
use the local parties in this
way without the risk of increas-
ing their influence inside the
UAR itself.
While Nasir has resorted
to police action against the
Communist party of Egypt sev-
eral times in the past, he now
seems to feel he can contain
domestic Communism through ad-
ministrative action. However,
he has removed Communists from
leading positions in the gov-
ernment of the Egyptian region.
Within the past few months
Nasir has taken steps to strength-
en his control over the labor 25X1
union movement and to safeguard
it against Communist penetra-
Neither the Communist party
of Egypt nor the party in Syria 25X1
--which is structurally part
of the Communist party of Syria
and Lebanon--is an immediate
threat to the regime. Of the
two parties, the Syrian has the
more dangerous potential.
Communist Party in Syria
With some 12,000 members,
the Communist party in Syria-As
proportionately, llarger than
that in Egypt; it has a better
leader in the' militant,
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influential Khalid Bakdash; and
it has shown a greater degree of
unity and discipline. Prior to
the formation of the United
Arab Republic last February,
party members had considerable
success in penetrating the of-
ficer corps of the Syrian Army,
some departments of the govern-
ment, and a number of labor
unions.
Concern over the extent of
Communist penetration was a ma-
jor factor in the decision of
the top Syrian leadership to
seek union with Egypt on Nasir's
terms; it may even have prompted
Nasir to speed up his own plans
for union. After the establish-
ment of the UAR, Colonel Abd
al-Hamid Sarraj, former chief
of the Syrian security forces
and one of the most competent
and forceful Syrian Army offi-
cers, was named minister of the
interior for the Syrian region.
He is doing an effective job in
displacing known Communists from
influential positions and in
keeping track of the activities
of party leaders.
Bakdash, who was deputy
in the former Syrian parliament,
returned to Damascus on 5 Octo-
ber after eight months in the So-
viet bloc. During his "voluntary
exile," he reiterated his op-
position to "antidemocr.^t:ic"
measures taken by the UAR under
the guise of Arab unity and to
proposals to dissolve the Com-
munist party. His return, un-
doubtedly sanctioned by Moscow,
may spur new efforts to step up
Communist activity in Syria.
A Kurd, he has a strong follow-
ing among Damascus' Kurdish
minority, and his return may
bring increased Communist ef-
forts to woo Middle Eastern
Kurds. It is not yet clear what
role he will play in the party,
or if he will direct a line of
all-out opposition to govern-
mental policy.
Egyptian Communist Party
The Communist party in
Egypt has an estimated member-
ship of rougly 14,000. Its great-
est success has been among stu-
dents and intelligentsia. Pro-
portionately, it has had more
members among minority groups
in the population than among
the Egyptians themselves. It
has always been divided into
factions, merging from time to
time and then splitting off into
new ones. In late 1957 and
early 1958, a series of mergers
brought the party as close to
organizational unity as it had
been in years. Ideologically
it has remained a strange as-
sortment of Stalin-type Marxists,
Khrushchevities, Tito-ists,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Mao-ists, pan-Arab Communists,
and Egyptians who give a mysti-
cal twist of their own to the
Marxist line.
The Egyptian party is again
rent with dissension. One wing
of the party wants to take the
safer_ course of continuing sup-
port for most of Nasir's poli-
cies; the other wants to break
with united-front activity and
launch a full-scale attack on
his policies, focusing on eco-
nomic and labor issues. One
wing has accused the other of
stealing its main clandestine
printing press; defections and
expulsions from the party lead-
ership are taking place.
Communist party leaders in
both regions of the UAR have
been dismayed by Nasir's present
program for control of the la-
bor union movement. They have
had little success with the
union movement since Nasir came
to power in 1954, and they see
an effective roadblock being
erected against their attempts
to gain control of precisely
those mass organizations which
should be susceptible to their
influence and particularly use-
ful as a lever for gaining pow-
er.
Two recent measures taken
by Nasir reduce even further
the opportunities for Communist
control of labor. These apply
to both the Egyptian and Syrian
regions, although now they are
being implemented only in Egypt.
Enforcement in Syria presumably
will wait until political prac-
tices and institutions there
are brought into closer line
with those in Egypt.
The first measure--a law
which became effective on 3
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April 1958--requires that all
candidates for trade union
boards be members of the Na-
tional Union--Nasir's "single
party" and main instrument of
political control--in which Com-
munists are prohibited member-
ship. The law provides the
legal justification for Nasir's
labor czar, Major Tuaymah, to
screen nominations for leader-
ship posts in the union move-
ment and to disqualify those
who do not "fulfill all the con-
ditions required of candidates."
Nasir's second recent meas-
ure is a sweeping program for
reorganization of the labor
movement under a new control
apparatus which will reach down
into the individual factories.
It calls for the creation of
labor committees and executive
boards at the plant, district,
area, and regional levels to
supervise and control all union
activity and to carry out the
labor policies determined by
the regime. Ostensibly the
leaders of these boards and
committees will represent all
factory workers who are members
of the National Union. Actual-
ly, the leaders will be hand-
picked or carefully screened
by Tuaymah and other National
Union executives.
If Nasir's labor program
is implemented in its present
form,the UAR Government's con-
trol of the union movement will
be nearly as complete as is the
Soviet Government's control
over its unions. In effect,
Nasir is borrowing from the
Soviet Union a tested mechanism
to use not only against all
tendencies toward independent
action by the unions, but also--
and especially--against expan-
sion attempts of the local Com-
munist parties themselves.
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CURRENT INTELLIGENCE WEEKLY SUMMARY'
WESTERN EUROPEAN ATTITUDES TOWARD THE UNITED NATIONS
There is genuine concern
among Western European powers
--particularly those with colo-
nies--over the growing power of
what they consider an irrespon-
sible and politically immature
voting majority in the UN Gen-
eral Assembly. Nevertheless,
Western Europeans generally see
the United Nations as a perma-
nent feature of international
life,, useful, among other things,
for "educating" the lesser de-
veloped countries to their in-
ternational responsibilities.
Most Western European members
would like to see the UN eco-
nomic assistance programs broad-
ened, believing that multilat"
eral aid through the UN best
offsets direct Soviet aid.
General Assembly's Power
The gradual assumption by
the General Assembly of juris-
diction, at the expense of the
Security Council, over issues
involving international peace
and security has created a di-
lemma for the West, which is
caught between the Soviet veto
in the Security Council and the
Asian-African majority in the
General Assembly. Because the
United States originated the
1950 "uniting for peace" reso-
lution as a way around the
USSR's abuse of the veto, some
Western European countries tend
to blame the US when their na-
tional interests are affected
by assembly consideration of
such issues as Suez. The 1950
resolution, which empowered
the General Assembly to act on
questions involving interna-
tional peace and security when
the Security Council is para-
lyzed by the veto, was consid-
ered illegal by the USSR when
it was invoked on the Hungarian
question, but the USSR acqui-
esced in its use during the
Suez and the recent Lebanese
and Jordanian crises.
Since 1950, the Asian-
African bloc in the UN has in-
creased from 28 percent of to-
tal membership to 35 percent.
Even combined with the nine
votes of the Soviet bloc, the
Asian-Africans do not possess
a majority, but their votes
alone are sufficient to pre-
vent assembly action in the
many cases requiring a two-
thirds majority.
In addition, the practice
among Asian-African countries
of abstaining en masse on cer-
tain East-West issues, such as
disarmament, seriously harms
the West's public propaganda
position by cutting down the
number of affirmative votes..
On 4 November, for example,
the General Assembly approved
the West's position on con-
trolled nuclear-test suspen-
sion with only 50 affirmative
votes, compared with last year's
MEMSERS OF UN SECURITY COUNCIL
1958-59
PERMANENT
CHINA
FRANCE
SOVIET UNION
UNITED KINGDOM
UNITED STATES
COLOMBIA ARGENTINA ASSUMES
SEAT I JANUARY 1959
IRAQ TUNISIA ASSUMES SEAT
1 JANUARY 1959
SWEDEN ITALY ASSUMES SEAT
1 JANUARY 1959
vote of 57 in support of the
West. The bulk of the'22'ab
stentions this year came from
the Asian-African bloc.
On many issues which
raise aspects of "colonialism"
or involve huge outlays of
money from the West for eco-
nomic development programs,
the Asian-Africans attract
substantial support from the
20-member Latin American
group.. This has been a prob-
lem, particularly for the West
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European colonial powers--Bel-
gium, Britain, France, Italy,
the Netherlands, Portugal, and
Spain. The great majority of
colonial items considered by
the UN are individually not ma-
jor political problems, but
stem from a mass of information
voluntarily submitted by the
metropolitan powers on the
trust territories and the non-
self-governing areas they ad-
minister. In addition, the
Asian-African bloc, supported
CURRENT INTELLIGENCE WEEKLY.SLTXKARY
13 November 1958
by the Soviet and Latin Ameri-
can blocs, has raised in the
UN other colonial issues such
as Cyprus, Algeria, and West
New Guinea, to such an extent
that some administering powers
have even threatened to leave
the organization.
UN members generally agree
that the charter looks toward
the attainment of self-govern-
ment by dependent areas, but
there is sharp conflict between
COMPOSITION OF UN GENERAL ASSEMBLY
11 MEM$ RS
VOTING BLOCS
WESTERN
BY CONTRIBUTION TO
BUDGET (1959-61)
Afghanistan
Australia
Argentina
Burma
Austria
Bolivia
Cambodia
Belgium
Brazil
Ceylon
Canada
Chile
Ethiopia
China
Colombia
Ghana
Denmark
Costa Rica
India
Finland
Cuba
Indonesia
France
Dominican Republic
Iran
Greece
Ecuador
Iraq
Iceland
El Salvador
Japan
Ireland
Guatemala
Jordan
Italy
Haiti
Laos
Luxembourg
Honduras
Lebanon
Netherlands
Mexico
Liberia
New Zealand
Nicaragua
Libya
Norway
Panama
Malaya
Portugal
Paraguay
Morocco
Spain
Peru
Nepal
Sweden
Uruguay
Pakistan
Union of South Africa
Venezuela
Philippines
United Kingdom
Saudi Arabia
United States
Sudan
Albania
Thailand
Belorussia
Tunisia
OTHER
Turkey
Israel
Bulgaria
Czechoslovakia
United Arab Republic
Yugoslavia
Hungary
Yemen
Poland
Rumania
Soviet Union
Ukraine
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the administering
powers and others
over the method and
speed with which the
charter's objectives
are to be achieved.
moreover, differences
of opinion exist over
which areas are to be
considered non-self-
governing, notably
between Portugal and
the anticolonials.
The latter do not ac-
cept Lisbon's view
that its overseas
territories are prov-
inces of metropolitan
Portugal and continue
their attacks on Por-
tugal in the UN.
UN Economic Aid
Despite the at-
tendant imbalance in
voting blocs, Western
European members are
convinced that admit-
ting the newly emerg-
ing nations of Africa
to the UN is the only
means of "educating"
them to their respon-
sibilities in the
world community. How-
ever, because such
new members, for the
most part, are not
economically viable,
their addition to the
already large group.
of underdeveloped
member nations cre-
ates more serious fi-
nancial differences
between the "haves"
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
and the "have-nots" in the
UN.
Western European members
constitute 18.5 percent of to-
tal UN membership but contrib-
ute 23.4 percent of the total
UN budget. In addition, their
support is vital to the various
UN economic development and
technical assistance programs,
of which countries in Asia and
Africa are the main recipients.
Recent surveys reveal that
Western Europeans generally
would like to see the UN eco-
nomic aid programs enlarged,
despite the tendency of the
"have-nots to bite the hand
that feeds them,"
Western European govern-
ments believe that multilateral
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aid programs through the UN
are one of the best means of
countering Soviet bilateral
aid projects. They also be-
lieve that UN programs would
be better because they feel
that American aid too often
involves military commitments
for the recipient.
Despite the disadvantages
they encounter in the UN,
Western European members
will continue to support
the organization. Many of
these countries are even
now studying means of increas-
ing the UN's effectiveness in
peace and security opera-
tions through establishment
of a permanent stand -b
peace force.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SINO-SOVIET BLOC ACTIVITIES IN GREECE
1. General Bloc Policy:
The bloc is trying to induce a
gradual drift in Greece toward
closer economic ties with the
Communist world and to reduceGreek
bilateral and NATO ties with
the West. Moscow would like to
see on the periphery of the bloc
a "positive neutralist" Greek
Government that is anti-Western,
intensely nationalist, and will-
ing to entertain closer all-
round relations with the bloc.
2. Local Communists and
sympathizers recurrently warn
of the dire consequences that
could result from establishment
of foreign rocket and missile
bases on Greek territory. Soviet
leaders continue to support the
1957 Rumanian proposal that
Greece join with the southern
satellites, Turkey, and Yugo-
slavia in a heads-of-state con-
ference pointing toward a re-
gional nonaggression pact. In
May, Khrushchev recommended the
Rumanian plan, which had been
rejected by Greece, and asserted
that Greece "can and must take
an important part in this noble
cause."
3. Despite satellite pro-
fessions of a desire for rap-
prochement, long-standing prob-
lems continue to aggravate re-
lations. Bulgaria has adamant-
ly refused to honor its war rep-
arations debt to Greece, which
amounts to $45,000,000 at 1938
exchange rates. Recent Rumanian
actions in expelling Greek na-
tionals were not well received
by the press in Athens.
4. The USSR plays the ma-
jor role in bloc efforts to draw
Greece into closer relations.
Among the satellites, Czechoslo-
vakia has been most active in
the economic field. Bulgaria's
effectiveness is hampered by
the tremendous antipathy felt
by the Greeks for the Bulgars.
5. Diplomatic Activity:
Greece has diplomatic rerillons
with the USSR, Bulgaria, Rumania,
Hungary, and Czechoslovakia, all
of which maintain missions in
Athens. The presence of an un-
authorized but very active Bul-
garian trade mission in Salonika
aggravated the deteriorating
Greek-Bulgarian relations during
the last six months. In August,
Athens again rejected Czechoslo-
vakia's request for a consulate
in Salonika in order not to set
a precedent that would open
northern Greece to bloc repre-
sentation. A Greek Foreign Min-
istry official stated in July
that Greece was not now actively
considering a resumption of re-
lations with Albania.
6. Economic Activity: Eco-
nomic relations continue to be
confined mainly to trade, but
Soviet spokesmen have often
hinted, both openly and covert-
ly, that aid would be forthcom-
ing if Greece asked for it.
7. Greek trade with the
bloc in the first four months
of 1958 continued above the 1957
level of $54,600,000. Trade
during the four months of 1958
totaled $22,;400,000 as compared
with $19,300,000 in the similar
period last year. Trade with
the USSR, Athens' major bloc
trading partner, accounted for
40 percent of Greece's bloc
trade in 1957, and a three-year
Greek-Soviet trade agreement
signed in July calls for annual
increases. Exchanges with the
bloc amounted to only 7 percent
of total Greek foreign trade in
1957, but the bloc supplied 17
percent of Greek POL imports.
8. The increase in Greek
trade with the bloc results pri-
marily from Greece's need to
find outlets for its agricultural
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CURRENT INTELLIGENCE WEEKLY $UMRy
13 November 1958
commodity surpluses. The USSR
recently offered to barter crude
oil for surplus tobacco in a
spot exploitation designed to
capitalize on an immediate Greek
problem of selling large stocks
of tobacco.
9. Prolonged Soviet civil
air negotiations with Greece,
an important step for any future
expansion of bloc services to
Egypt and the Near East, area
now dormant. Rumania and Poland
continue to fly into Athens on
regular schedules tightly con-
trolled by the Greek Government,
which authorizes them only for
periods of four to six weeks at
a time.
10. Cultural and Propaganda
Activities: The USSR is in the
fooref ron of bloc cultural and
propaganda efforts, and the So-
viet Embassy was a focal point
for widespread dissemination of
printed propaganda until a recent
Greek law banned such activity.
Bulgaria, Czechoslovakia, and
Communist China all receive
propaganda support within Greece
from bilateral friendship and
cultural societies.
11. The level of delegation
exchanges between Greece and
the bloc continued to rise in
the first half of 1958 and to-
taled 61 as compared to 30 dur-
ing a similar period in 1957.
In September the Soviet ambas-
sador renewed Moscow's invita-
tion to Greek Premier Karamanlis
to visit the USSR. Most dele-
gation exchanges in 1958 have
been cultural. The first Greek
delegation to. visit Communist
China was a parliamentary group
in September.
12. The bloc's weekly Greek-
language broadcast output amounts
to 65-70 hours per week--14 of
which are from Soviet transmit-
ters. In March a quasi-clandes-
tine program called the "Voice
of Truth" began broadcastin
25 minutes daily
is strongly anti-Greek Gov-
ernment and anti-American, and
the transmitter is operated on
behalf of the illegal Greek Com-
munist party.
13. Subversive Activity:
The Communist Party o reece
(KKE), which was declared illegal
in 1947, has its headquarters
in Bucharest, Rumania. Since
1949, it has sponsored a legal
front party, the United Demo-
cratic Left (EDA), representing
the extreme left in Greek poli-
tics. The KKE in Bucharest sup- 25X1
ports the illegal Communist or-
ganization working within Gree
The EDA, how-
ever, has carefully kept itself
apart from the KKE, which is
popularly associated with bitter
memories of the civil war.
14. In the May national
elections, the EDA, running for
the first time since 1952 as a
single party rather than in a
coalition, received 24.4 percent
of the popular vote, thus gain-
ing the second largest represen-
tation in the Greek Parliament
with 79 of the 300 deputies.
This sharp increase over its
previous polling of about 10
percent of the vote in 1952 ap-
parently included a large pro-
test vote against the policies
of the government and center
parties. EDA's strength is con-
centrated in the large urban
areas, particularly Athens,
Piraeus, and Salonika, and in
the tobacco-processing districts
of Macedonia.
15. The EDA waged a moder-
ate campaign in May and this,
together with its advocacy of
economic reforms, has given it
a new respectability. The EDA
may now be able to create the
fiction of a "popular front"
by splitting parliamentary mem-
bership into several "independ-
ent" parties, a process which
appears to have actually started
in September with the formation
of a "Democratic Union" and of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 November 1958
an agricultural movement from
among its deputies.
16. Greek Communists are
attempting to secure legaliza-
tion of the party and an am-
nesty for party members. In
the longer run they want to cre-
ate a strong nationwide party
of workers, farmers, and middle-
class elements. Communist cam-
paigns in the last year have
played heavily on latent Greek
fears of involvement in a nu-
clear war and have been largely
devoted, with some success, to
creating strong opposition to
the establishment of American
intermediate-range missile bases
in Greece. The Communists have
been aided by the continuing
Cyprus controversy, which tends
to alienate Greece from Turkey
and Britain and to a lesser de-
gree from the United States.
They further appeal to the strong
sense of Greek nationalism by
denouncing extraterritorial
rights granted to American serv-
icemen and demanding abrogation
of existing agreements granting
base rights in Greece to the
United States.
17. Communist labor policy
has been to capture non-Commu-
nist unions from within rather
than setting up parallel organi-
zations. The full potential of
this policy has not been realized
because of continued government
security measures and the vig-
orous anti-Communist opposition
within the General Confederation
of Greek Workers (GSEE), The
Communists have succeeded, how-
ever, in gaining the collabora-
tion of the secretary general
of the GSEE in a series of crit-
ical union elections. In the
13th GSEE congress in October,
11 members of the newly elected
30-man executive council are
known to be Communist collab-
orators.
18. Greek Reaction to Com-
munist Activities: Relations
between Greece-and the bloc, ex-
cept for Bulgaria and Albania,
are normally coal but correct,
in line with the pro-Western
orientation of the present gov-
ernment. Soviet support for
Greece on the Cyprus issue, com-
bined with Greecei' frustration at
lack of support from its NATO
allies, has led to a revival of
Soviet prestige in Greece from
the low point it reached at the
end of the civil war in 1949.
There has been a concomitant
decline in Greek estimates of
the danger:-from the Soviet bloc.
The present government is will-
ing to expand trade with the
USSR but is rejecting Soviet ef-
forts to increase relations in
other fields. Since the May
election, the Karamanlis gov-
ernment, alarmed at gains in
the extreme left,'is also ac-
tively engaged in a campaign to
harass and restrict the activi-
ties of EDA and is reviewing
socio-economic measures to re-
duce the attraction of EDA cam-
paign promises in future elec-
tions.
19. The Outlook: The bloc
will probably con inue to fol-
low the main lines of its pres-
ent policy toward Greece. It
is unlikely that the bloc will
succeed in inducing Greece to
adopt a "neutral, independent"
foreign policy in the near fu-
ture. Greece's strong popular re-
sentment on the Cyprus issue,
however, and the resulting psy-
chological disengagement with
its allies, may cause a further
gradual weakening of Greek ties
with the West. The present gov-
ernment is expected to continue
to work with the West in coun-
tering Soviet bloc diplomatic,
economic, and cultural initia-
tives. The Greek Government can
be expected to continue its cam-
paign of harassment against the
EDA,
20. Soviet trade with
Greece may continue to expand.
Bloc willingness to buy commodity
surpluses of major Greek products
could make important segments of
the Greek economy largely de-
pendent on Soviet decisions, al-
though it is unlikely that the
over-all Greek economy will be-
come substantially dependent
on this trade.
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