CURRENT INTELLIGENCE WEEKLY SUMMARY

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• Collection: General CIA Records
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• Publication Date: October 26, 1999
• Content Type: SUMMARY

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CO FIDNL
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
CENTRAL
DOCUMENT NO.
NO CHANGE IN CLASS. 13
? DECLASSIFIED
CLASS. CHANGED T
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AUTH: R 70- r
OATEN REVIEWER:
INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
RETURN TO ARCRIVES & RECORDS CENTER
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CONFIDENTIAL
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COPY NO.
OCI NO.0024/59
22 January 1959
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THIS MATERIAL CONTAINS INFORMATION AFFECT-
ING THE NATIONAL DEFENSE OF THE UNITED STATES
WITHIN THE MEANING OF THE ESPIONAGE LAWS,
TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS-
SION OR REVELATION OF WHICH IN ANY MANNER TO
AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
The Current Intelligence Weekly Summary has been prepared
primarily for the internal use of the Central Intelligence
Agency. It does not represent a complete coverage of all
current situations. Comments and conclusions represent
the immediate appraisal of the Office of Current Intelligence.
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CONFIDENTIAL`
CURRENT:. INTELLIGENCE 'WEEKLY SUMMARY
22 January, 1959
THE GERMAN QUESTION
Moscow is attempting to
encourage West German opposi-
tion parties to make a major
public issue of Chancellor
Adenauer's rejection of any
negotiations on a German peace
treaty. Soviet propaganda at-
tacks on Adenauer's alleged
intransigence have been ac-
companied by Soviet Ambassador
Smirnov?s warnings,to Social
Democratic party (SPD) leaders
that the Soviet peace treaty
proposal is the last chance
leaders probably hope such pres-
sure tactics will isolate
to modify his position on
peace treaty negotiations and
recognition of the East German
regime or lead to a. revolt
against his foreign policy
leadership among the Christian
Democrats as well as the oppo-
sition parties.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
The Soviet effort to in-
fluence the West Germar opposi-
tion is quite evident in Moscow's
propaganda, which has taken
pains to brand the Bonn govern-
ment as the main obstacle to a
German peace treaty. One com-
mentator, after describing the
warm reception the draft treaty
has received in both capitalist
and neutral countries, asserted
that only Bonn has maintained
an intransigent attitude, "while
Washington and London, although
rejecting the Soviet proposal,
have not closed the door."
Free-world pressures for
flexibility appear to have
shaken Chancellor Adenauer's
strong resistance to any nego-
tiations or flexible counter-
proposals on Berlin or a German
peace treaty. Following a
series of cabinet meetings
and talks with a top Bonn For-
eign Ministry official recently
returned from Washington, Ade-
nauer publicly indicated his
willingness to discuss counter-
proposals with the Western
Allies. Christian Democratic
Union leaders have indicated,
however, that. Adenauer will
probably maintain his position
that a controlled disarmament
agreement is a necessary pre-
condition to solution of the
German question.
Bonn has been concerned
over the favorable press treat-
ment of Mikoyan's visit as por-
tending a split between Bonn
and Washington on the question
of free: elections and German
unification. Mikoyan's glib
approach, it was feared, would
obscure the fact that Moscow
has not modified its original
stand on Berlin. Consequently,
Adenauer probably feels it
necessary to adopt a more flex-
ible attitude in order to point
up Moscow's own intransigence
as-well as to satisfy demands
for greater initiative on the
German problem.
American officials in Bonn
feel that Adenauer ultimately
would prefer negotiations lim=
ited to Berlin--even if this in-
volved recognition of East Ger-`
many--to a conference on European
security in which the West would
be under strong public pressure
to accept a disengagement plan.
Adenauer may feel that by link-
ing controlled disarmament to
German unification he can avoid
any high-level East-West talks
limited to the German question.
Bonn could then revive its pro-
posal--even though rejected by
Moscow--for a permanent four-
power commission to discuss all
aspects of the German problem,
possibly with the participation
of German "experts."
British Reaction
The British press continues
to show a keen desire for "posi-
tive" Western responses on Ber-
lin and Germany. The Economist
argues that it nowTs I?tn ihe
West's interests to achieve a
military disengagement.
These sentiments presumably
extend into some official cir-
cles. In an aide-memoire to
Washington on 13 January, Lon-
don suggested the West seek a
Soviet guarantee that the East
Germans would carry out erst-
while Soviet obligations relat-
ing to Berlin, London also advo-
cated some form of UN guarantee
or presence in the whole of
Berlin going beyond the part
assigned to the UN in the
original Russian note.
East German Confederation Plan
East German party boss
Ulbricht, in an attempt to demon-
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
strate continued flexibility
and desire to negotiate, pn
January proposed a plan for
confederation of the two Ger-
manys which incorporated most
the elements of earlier East
German proposals on this subject.
The confederation, he suggested,
would have as a supreme organ
an all-German council of 100
members nominated on a basis of
parity by the parliaments of
the two German states from
their parliamentary deputies.
Ulbricht envisages the
all-German council as a purely
advisory body which would have
no directive power over the
parliaments of the two German
states. It would first devote
its efforts to the signing of
a peace treaty and thereafter
deal with such questions as
concluding agreements with
other countries on foreign trade,
aaritime shipping, and the con-
federation's accession to inter-
national organizations. It
would make recommendations on
a wide range of problems between
the two Germanys, forming a
number of commissions and com-
mittees to handle such matters
as financial settlements, trade,
transportation, insurance and
labor problems, and cultural
matters. It would also fix
the numerical strength of the
two countries' armed forces.
Ulbricht emphasized that
the confederation would be tem-
porary and would lapse when the
provisions of a peace treaty
had been carried out, Germany
reunified, and "all-German
elections" held for a national
assembly. His reference to
all-German elections, a concept
Ulbricht did not clarify, may
be designed to enhance the
plan's attractiveness to
the West, which has con-
sistently demanded free elec-
tions as a prere uisite to
reunification.
MIDDLE EAST DEVELOPMENTS
Iraq
Iraqi Prime Minister Qasim's
order limiting the functions of
the Communist-dominated Popular
Resistance Force does not seem
yet to have produced a signifi-
cant reduction in Communist
strength, and the regime has made
no additional anti-Communist
moves.
Qasim's first interview
with the new American ambassador
indicated no shift in his out-
look. Qasim reiterated his
hope for American help and
friendship, said he was deter-
mined to pursue! a "neutral"
course in foreign relations,
and complimented American con-
tractors as more honest and
efficient than others working
in Iraq. He still appeared
deeply suspicious of Western
intentions, however, and also
repeated again the "rumors"
American subversive activity
which, he said, he "of course"
did not believe.
Nasir's internal anti-Com-
munist campaign is becoming some-
what muted. Press articles at-
tacking the Communists continue
to appear sporadically in UAR
papers and in UAR-controlled
organs in other countries, but
have become more selective. In
the Syrian region, large numbers
of Communists arrested in the
early sweeps appear to have been
released by the police after
signing a document abjuring
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
Communism and promising to re-
frain from any future party ac-
tivity. Higher level Communists
reportedly are being held for
more intensive interrogation,
along with some prominent pro-
Communist personalities.
Nasir seems also to be
trying to drown. out the pro-
Communist overtones which have
marked several Afro-Asian con-
ferences in Cairo e An Afro-
Asian youth conference scheduled
there for 2-8 February is to run
concurrently with a UAR youth
festival, The regime reported-
ly intends to import some 2,500
Syrian youths for the festival,
which will consist of parades
and other well-publicized activ-
ities. The UAR youth group in-
tends to invite the 450-500
foreign delegates expected for
the Afro-Asian conference to at-
tend only the closing ceremonies
of the festival. The rest of
the time they presumably will
be expected to observe and ad-
mire the fervent support of Arab
youth for the Nasir regime. The
youth meetings are to be followed
by the annual session of the
Afro-Asian People's Solidarity
Council, which both the UAR and
the Communists seek to exploit.
The USSR's public attitude
toward Nasir's campaign has
moved closer to open criticism,
but Moscow continues to avoid
independent comment. On 19 Jan-
uary Moscow radio beamed to Arab
listeners an attack by the Moroc-
can Communist party calling Nas-.'
ir's action a "blow to democracy"
which will hinder the Arab strug-
gle against imperialism. On 9
January a Warsaw newspaper
claimed that Nasir is "no longer
the symbol of Arab unity for the
Iraqi populace." The Indonesian
Communist party secretary gen-
eral has also criticized Nasir's
moves as part of Egyptian domina
tion of Syria, and the French
party paper L'Humanitd has
published a communique" of the
outlawed Algerian Communist par-
ty charging that the UAR action
is aimed at "Arab patriots" who
supported Nasir against the im-
perialists in the Suez crisis.
Nasir's relations with the
West have undergone further im-
provement with the initialing
of a financial accord with Brit-
ain. Under the terms of this
agreement, which is subject to
further negotiation before it
is formally signed, London will
release Egyptian sterling bal-
ances, amounting to about $200,-
000, 0008; frozen since the Suez
crisis. In return the UAR will
pay Britain about $67,000,000
for nationalized British prop-
erties and for damage to se-
questered properties. Those in
the latter category are to be
returned to their British owners.
War claims were not involved in
this agreement, nor British
claims for compensation arising
out of Egypt's seizure of the
Suez base,
A new UAR gesture toward
Kuwait may be in the making.
A military mission, headed by
the Syrian commander of the UAR
First Army, flew to Kuwait on
17 January, ostensibly to re-
turn formally the earlier visit
to Cairo by Kuwait's deputy
ruler, who also controls the
skeikdom's security forces. The
Ruler of Kuwait is vacationing
in Lebanon.
So far there has been no
announcement of significance,
but one purpose of the trip al-
most certainly is to demonstrate
continuing UAR interest in
Kuwait and to ward off any Iraqi
designs on this oil-rich state,
Lebanon
A dispute over whether the
language of instruction in Leb-
anese law courses should be
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
Arabic or the traditional French
has produced another upsurge of
sectarian tension in Lebanon.
Christian and Moslem students
have engaged in strikes and
counterstrikes, three students
have been injured in clashes,
and the cabinet is reported
deeply divided on the issue.
While this particular ques-
tion seems likely to be settled
,by compromise, the flare-up is
likely to support fears in both
communities that civil strife
may be renewed in the next few
months. The government, which
is receiving little in the way
of leadership from President
Shihab, has never made a serious
effort to disarm the population,
and each group accuses the other
of maintaining armed training
camps.
Yemeni. Crown Prince Badr,
the principal proponent of closer
relations between Yemen and the
Sino-Soviet bloc, has sought to
sabotage an agreement by which
the United States would supply
15,000 tons of wheat to alleviate
possible famine conditions in
Yemen. Badr is reported to have
persuaded the Imam to accept in 25X1
addition to the American offer 25X1
an offer of 10,000 tons of Soviet
Yemeni officials pre-
viously estimated that 15,000
tons is the maximum which
Yemen's port facilities could
handle during the two-month
period when both shipments
would arrive.
A new period of strained
relations with the West appears
to be rapidly developing in Cam-
bodia. Premier Sihanouk has
lashed out against a "foreign
plot" allegedly aimed at elimi-
nating the nation's monarchial
system and neutral foreign pol-
icy in favor of a pro-SEATO
republican form of government.
Sihanouk has openly accused
Thailand of mounting a military
conspiracy against his govern-
ment in league with "traitorous"
Cambodian elements headed by
former royal councilor Sam
Sary and exiled former premier
Son Ngoc Thanh. American and
South Vietnamese :complicity in
the intrigue is being strongly
implied.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
This trend may presage a
closer accommodation of Cam-
bodia with the Communist bloc.
Strong criticism of the West
and SEATO preceded Sihanouk's
initiation of economic and po-
litical ties with the Sino-So-
viet bloc in 1956. Again, ex-
pansion of these ties last July
to include full diplomatic re-
lations with Peiping followed
complaints of Western bias
against Cambodia in its border
dispute with South Vietnam.
Sihanouk has frequently vowed
that he would turn to the Com-
munists for support in the event
he felt threatened by the West.
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CONFIDENTIAL
CURRENT INTELLIGENCE WEEKLY-SU)MMY
22 January 1959
NOTES AND COMMENTS
SOVIET PARTY CONGRESS
The special Soviet 21st
party congress, scheduled to
begin on 27 January, is ex-
pected ?to acclaim :Khrushchev's
policies and add to the adula-
tion already being given him.
It may mark the complete vic-
tory of Khrushchev over his
opponents by ousting members
of the "antiparty group" from
the party. It may also make
some changes in the central
committee, although a major
revamping appears unlikely.
The oblast party confer-
ences and republic party cbn-
gresses held throughout the
country in preparation for the
national congress have ended,
and the delegates they elected
are beginning to arrive in Mos-
cow. The early appearance of
some top party officials from
posts outside the capital may
indicate that the congress is
being preceded by high-level
discussions, possibly includ-
ing a preliminary report by
Mikoyan on his trip to the
United States.
The only item on the for-
mal agenda is Khrushchev's re-
port on the new Seven-Year Plan.
The text of this report was ap-
proved by the central committee
in November, but since then
criticism of specific provisions
and omissions has appeared in
the Soviet press. Khrushchev
may take these "suggestions"
into account, and the plan
finally approved may differ
slightly from the draft.
The congress will probably
not limit itself to its formal
agenda. Recent republic party
congresses discussed a variety
of domestic problems despite
the fact that the Seven-Year
Plan was the only substantive
item on their agendas, and
Khrushchev implied there would
be several topics when he told
US Ambassador Thompson at a New
Year's reception in Moscow that
the congress had a heavy sched-
ule.
There is little to indi-
cate what additional topics
might be discussed. Presidium
member Suslov said in October
that the congress would deal
exclusively with internal mat-
ters. Since then the develop-
ment of the Berlin crisis'and
Mikoyan's trip to the United
States may have changed the
original plans.
Present indications are
that the congress will confirm
existing policy rather than in-
augurate changes, but the pos-
sibility of a surprise in this
regard cannot be ruled out.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
SOVIET ECONOMIC REPORT FOR 1958
The USSR's gross industrial
output in 1958 increased 10 per-
cent over 1957 and the grain har-
vest was the biggest in Soviet
history, according to the of-
ficial year-end statement issued
in Moscow on 15 January. This
industrial increase is identical
to that reported for 1957 over
1956 and is higher than the av-
erage annual increase--8.6 per-
cent--necessary to meet the
Seven-Year Plan (1959-1965) goals
in Khrushchev's theses. This
year's plan fulfillment was ap-
parently published earlier than
usual to give the forthcoming
21st party congress, convening
to approve the Seven-Year Plan,
a current statistical statement
of achievements.
A Pravda editorial on the
report s aces that the actual
increase of 10 percent in indus-
trial output as opposed to the
planned 7.6 percent "shows strik-
ingly" that the average annual
increase planned for the Seven-
Year Plan is "fully justified
and realistic." A large over-
fulfillment also marked 1957,
when the plan called for a 7.1-
percent increase. Both these
instances of conservative plan-
ning will be cited at the 21st
party congress as justification
for adopting the higher rate of
planned growth presented in the
theses on the Seven-Year Plan.
This higher rate is believed
feasible.
The 11-percent rise in
producer goods in 1958 is the
same as in 1957, but the in-
crease in consumer goods was
only 7 percent, compared with
8 percent in 1957. In the case
of consumer goods, while the
category of light industry showed
a greater growth than in 1957,
the increase in the food indus-
try category was smaller than
SOVIET PRODUCTION OF SELECTED ITEMS
PIG IRON
MILLION METRIC TONS
1957 1958 1958
PLAN
PETROLEUM
MILLION METRIC TONS
1957 1958 1958 1957
PLAN
90122
CRUDE STEEL
MILLION METRIC TONS
1957 1958 1958
PLAN
ELECTRIC POWER
BILLION KILOWATT-HOURS 760
1957 1958 1958
PLAN
SECRET
1957
496 488.9
1957 1958 1958
PLAN
NATURAL GAS 306
BILLION CUBIC METERS
PLAN
22 JANUARY 1959
25X1
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
in the preceding year, The
food industry output increase
next year may be large because
of this year's record agricul-
tural output,
The 6-percent rise in in-
dustrial labor productivity con-
tinues the recent trend of a
diminishing rate of increase--
8, 609, and 6.5 in 1955, 1956,
and 1957 respectively. The de-
cline in 1957 and 1958 is not
surprising since an acceleration,
of the program for reducing the
workweek has occurred,
Total capital investment
increased more than 11 percent
over 1957 to 235 billion rubles.
Centralized capital investment,
though fulfilling the revised
1958 plan by only 97 percent,
still exceeded the original plan
of 199 billion rubles by 3 bil-
lion rubles. In addition, capi-
tal investment financed outside
the plan by enterprise and local
means increased 32 percent over
the 1957 level to 33 billion
rubles.
The plan for construction
work was overfulfilled, but de-
liveries of equipment were only
92 percent of plan. These equip-
ment shortages were pronounced
in the chemical and ferrous
metallurgical industries.. Con-
struction of urban housing in-
creased by one third over 1957
and was significantly more thin
planned, Construction of rural
housing declined somewhat.
Despite a relatively success-
ful year in terms of the volume
of capital investment, the plan
for the commissioning of new
capacity was not meta This,
and the underfulfillment of plans
in at least two priority indus-
tries, chemical and metallurgi-
cal, indicates continuing dif-
ficulties in the administration
of investments,
Record crops of grain,
sugar beets, and sunflower seeds
were harvested, but the produc-
tion of cotton, potatoes, and
vegetables in 1958 was either
about equal to or somewhat less
than in 1957, In 1958 the num-
ber of livestock continued to
increase as did the output of
livestock products. The rate
of increase in meat and milk
production in 1958, however, was
roughly half as great as the
increase during 1957.
According to the plan-ful-
fillment report, the Soviet
Union surpassed the United States
in total milk production in 1958.
The original goal was to surpass
the United States in per-capita
as well as total production in
1958, but the USSR still has a
long way to go to achieve this.
Furthermore, the announced Soviet
total includes milk other than
from cows, and Soviet and Ameri-
can methods of reporting milk
production differ.
(Prepared by ORR)
BRIGADES OF COMMUNIST LABOR
"Brigades of Communist
Labor," lauded as the "first
cells of the future Communist
society," have recently been
introduced in factories and
workshops throughout the USSR.
The movement, which will prob-
ably receive plaudits at the
forthcoming 21st party congress,
is part of a general drive to
stimulate labor productivity
by presenting the attainment
of Communism as a very real
goal.
The work of the brigades,
it is hoped, will offset the
possible retarding effect of
reduced hours of work--now be-
ing implemented--and smaller
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
increases in the labor force
during the Seven-Year Plan pe-
riod. The movement is expected
to make work more attractive to
Soviet youth and differs from
earlier production drives in
that it aims to improve not
only the work habits but also
the personal conduct of the
workers. It also seeks to im-
prove the worker's attitude
toward social responsibility.
Labor brigades, first in-
troduced early last November,
became widespread after the
announcement of Khrushchev's
theses for the Seven-Year Plan.
KROKODIL ILLUSTRATES SOME TARGETS OF
"BRIGADES OF COMMUNIST LABOR"
At first, work teams simply
pledged to increase their pace,
organize their leisure, and
moderate their personal con-
duct, but late in November the
central party apparatus, through
its Komsomol branches, began
to regularize the movement.
A set of commandments was for-
mulated and competitions among
work brigades vying for recog-
nition as "Communist labor
brigades" were publicized in
the press.
The movement was accorded
ideological legitimacy by be-
ing compared to the movement
SECRET
in early Soviet history known
as "Saturday workers." The
Saturday workers' movement,
which bore Lenin's personal ap-
proval, was introduced at a
time when leading Bolsheviks
were heralding the Soviet
Union's transformation into a
Communist society. The move-
ment was to work against bourge-
ois egoism and customs and to
discourage personal laziness
and lack of discipline. Labor
movements from then until the
present-day brigades, however,
stressed primarily improvements
in work habits and generally
omitted considerations of per--
sonal conduct and social con-
sciousness of the workers.
Stakhanovism followed the
Saturday workers' movement, and,
although it was one of the best
known of the productivity move-
ments, it was not used as the
historical antecedent for the
"brigades"--presumably because
it became very unpopular in
its later years. Furthermore,
the purpose of Stakhanovism
was to encourage individual
productivity--thus making it
unsuited as a model for a move-
ment which stresses the competi-
tive group. There continue to
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
be "socialist competitions,"
which in recent years have re-
ceived more emphasis than Stak-
hanovism, although their pur-
pose appears to be more limited
than that of the present brigade
campaign.
Each brigade must sub-
scribe to the slogan "To work
and live as a Communist" and
accept the following code: 1)
to look on labor not only as a
means of existence but as a
physical and spiritual necessi-
ty; 2) to negate ego and to
work for the best interests of
the state and community; 3) to
study conscientiously to raise
labor skill and general educa-
tional and political level;
4) to break with "survivals of
the past"--i.e., drunkenness,
hooliganism, and foul speech;
and, 5) to proselyte potential
brigades.
Besides their role in pro-
viding a fresh labor movement,
the brigades are expected to
make work appear more attrac-
tive and socially acceptable to
Soviet youth. This is in re-
sponse to Khrushchev's criticism,
voiced in his proposals for edu-
cational reform, that students
are unprepared for practical
life and eschew work in indus-
try and agriculture. Likewise,
the brigades may, by publicizing
night-school programs and cor-
respondence training in techni-
cal schools, overcome the re-
sistance of parents who insist
that their children receive the
special advantages of higher
education.
It is difficult to deter-
mine the actual number of bri-
gades. Many were organized be-
fore the regime began to support
the movement officially, and
others probably are being or-
ganized unofficial) in some
parts of the USSR.
(Prepared by ORR)
BULGARIA PLANS SWEEPING REORGANIZATIONS
Plans for a radical re-
organization of the entire Bul-
garian state and economic struc-
ture, announced by a central
committee plenum in mid-January,
appear to follow closely the
Soviet pattern of regional eco-
nomic administration.
The Bulgarian reorganiza-
tion is to be accomplished by
the elimination of many central
government ministries and by
the elimination of the present
regional and district adminis-
trative system. Instead, some
30 administrative economic units
are to be set up which will be
intermediate in size between
the region and district. These
presumably will take over opera-
tional management of enterprises
previously exercised by the
central ministries. The new
units are also intended to bring
about "a unification of the
entire political, state, economic,
and cultural life in a given
territory."
Those ministries scheduled
to be eliminated are those for heavy
industry, light industry, com-
munal economy, public health and
welfare, food industry, electri-
fication and water supply, and
construction materials. On the
central governmental level, how-
ever, committees or commissions
are to be set up which presumably
will retain some of the central-
ized control functions of the
former ministries. As in the
USSR, the administration of
foreign affairs, national de-
fense, interior, trade, and
agriculture and forests will be
retained on the central level
in the form of ministries. Un-
like current Soviet practice,
however, the new administrative
units will have jurisdiction
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
over agricultural units within
their boundaries.
The system of state ad-
ministration through Peoples'
Councils in the regions and dis-
tricts will be altered so that
the jurisdiction of the councils
will correspond to the new bound-
aries. This placing of respon-
sibility for cultural and polit-
ical life under the jurisdic-
tion of local organs, suggestive
of Chinese commune practice,
goes beyond the purely economic
nature of the Soviet sovnarkhoz
system. It may thus be a unique
Bulgarian adaptation which seeks
to combine the economic func-
tions performed in the USSR by
the sovnarkhozy and the politi-
cal functions of the Soviet
oblasts.
Almost all the Bulgarian
leaders--including Zhivkov--
incline to a hard-line attitude,
making them sympathetic to at
least the spirit of Peiping's
original commune program.
Zhivkov, however, is probably
more conscious of the necessity
to please Moscow than is Cher-
venkov, who is an unreconstructed
Stalinist and, on the strength
of his visit to China in Octo-
ber, the country's "Chinese
expert." There is good evi-
dence that Zhivkov is in Khrush-
chev's favor and, conversely,
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22 January 1959
that Khrushchev;and:.Chervenkov
have a strong mutual dislike
for each other.
The plans announced in
mid-January, which . are: so'.
clearly based on the Soviet
example, demonstrate that
Zivkov's policies, launched
last October and November, con-
tinue to prevail. The question
of Chinese Communist influence
in Bulgaria, however, as sug-
gested by the terminology and
spirit of Bulgaria's economic
program, may not yet be fully
resolved within the Bulgarian
party leadership.
CZECH AGRICULTURAL POLICIES
Czech agriculture, for.
which a 12-percent rise was
planned in 1958, not only failed
to increase production over 1957,
but again failed to surpass
prewar output levels. For the
present, a solution is being
sought primarily through mech-
anization,,although;a reorganiza-
tion of collective farms and
machine tractor stations (MTS)
may be in the offing. The re-
gime is bent on forced draft
collectivization and other pol-
icies, however, which tend to
antagonize the rural population
and hold little promise for
significant improvement.
The decision to double last
year's deliveries of farm ma-
chinery from all sources, in-
cluding some from the MTSs, to
the collectives is a genuine
effort to better performance,
although the inventory of col-
lective-owned machinery now is
small. Previous experience
with ownership of equipment by
collective farms has been satis-
factory, whereas organizational
defects and inadequate staffs--
both in training and numbers--
at MTSs have caused endless
problems. In addition, Prague
plans a sharp rise in agricul-
tural machinery imports in 1959-
60.
abolishing them, although the
Czechs have stated that their
country has not yet reached the
necessary stage of development.
While collectivization in Czech-
oslovakia is not yet completed
and farming units now are too
small for the abolition of MTSs
to be economical with present
models of machinery, there are
indications that collectives
may be merged into larger units.
Furthermore, the government for
several years has..., made light
farm equipment available to col-
lectives, ::and;. by sufficiently
increasing machinery supplies,
the justification for MTSs would
be partially eliminated.
Bulgaria, the only satel-
lite where collectivization is
essentially completed, recently
effected mergers which reduced
the number of collectives by
more than three fourths in less
than three. months. Party chief
Zhivkov has stated that Bulgarian
MTSs will gradually be abolished.
If the Czech regime succeeds
in its plans to increase the
amount of machinery available
to the collectives, the amount
of agricultural investment, and
the number of young agricultural
workers, some improvement in
production will result, However,
present supplies of chemical
Diminution of the 'MTSs' fertilizer and farm machinery,
role suggests that Uzechoslova. although far exceeding those be-
kia might eventually follow the fore the war, are inadequate
Soviet lead in revising or for realizing current production
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
plans. Lack of spare parts
further limits the effective-
ness of farm machinery. These
deficiencies are accompanied
by insufficient technical train-
ing at the farm level and a
lack of incentives, all of
aviich perpetuate low productiv-
ity and stubborn noncoopera-
tion on the part of collective
members.
The regime appears far
from ready to work out an ef-
fective incentive program.
rapid collectivization during
the past two years has magnified
the need for machinery, driven
the peasant to the city, and
otherwise intensified agricul-
tural problems leading to pro-
duction stagnation--yet collec-
tivization will be pushed in
1959-60. Premature consolida-
tion of collectives--now a
possibility--would also dis-
rupt production, as would any
abolition of private plots, a
step being rumored among the
peasants. Recommendations in
recent editorials that collec
tives allocate less farm income
to wages and more to the purchase
of machinery reflect the regime's 25X1
preoccupation with mechanization
but expand the list of peasant
grievances. (Pre-
pared by ORR
CONSERVATIVE PARTY COMPROMISES IN JAPAN
A last-minute compromise
between Japanese Prime Minister
Kishi and his rivals in the rul-
ing Liberal-Democratic party
virtually assures Kishi's re-
election as party president on
24 January, but party factional-
ism is not completely resolved
and probably will continue to
preclude his exercising firm
leadership. The overriding
factor in the compromise appears
to have been general conserva-
tive concern for maintaining
party unity in the face of a
difficult Diet session and up-
per house elections in June.
The terms of the compromise have
not yet been revealed, but they
presumably involve a commitment
by Kishi to appoint some of the
rival leaders to cabinet or
party posts in the near future.
Kishi's compromise with the
dissidents apparently is a tem-
porary respite. In the area of
foreign policy; in particular,
Kishi may be forced to give
ground on several important is-
sues. Paramount is the question
of closer relations with Commu-
nist China; on 21 January Kishi
told a press conference that
Japan would be willing to hold
ambassadorial talks with Pei-
ping's representative if the
occasion presented itself. In
addition, the stalemate in
talks with South Korea and a
rapidly developing movement in
Japan for the repatriation of
some 300,000 Korean residents
to North Korea may force Kishi
to abandon his "wait and see"
attitude on this issue.
The opposition Socialists,
invigorated by the defeat de-
livered to Kishi on the police-
powers bill during the last
session of the Diet, are anx-
ious to frustrate approval of
an expected revision of Japan's
security treaty with the United
States. They also hope to ham-
per passage of the budget bill,
which incorporates Kishi's pub-
lic pledges for reduced taxes,
a national pension system, and
a health insurance program.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
TAIWAN STRAIT SITUATION
The Chinese Communists
appear to be varying their
activity in the Taiwan Strait
in order to demonstrate that
they hold the initiative and
to exert psychological pressure
on the garrisons of the off-
shore islands. They have held
amphibious training exercises
near Amoy under observation of
the Nationalists, hit the is-
lands with larger but less fre-
quent bombardments, constructed
additional gun emplacements and
field fortifications, and may
have brought in more artillery
and artillery radar.
Nationalists report that
long-range, large-caliber guns
may have been set up opposite
the Chinmens. American observ-
ers on Chinmen believe the
heavy Communist bombardment of
over 30,000 shells on 7 January
was in reaction to the increased
effectiveness of Chinese Na-
tionalist counter-battery fire.
Another reason, however, is
probably to demonstrate that
Communist China did not suffer
a defeat in previous military
activities in the strait.
In an effort to demonstrate
"leniency" and to stress that
the Nationalists can maintain
their position only on Peiping's
sufferance, Communist batteries
did not fire on three recent
odd calendar dates.
For the past two months
the Chinese Nationalists have
concentrated on Communist bat-
teries located in the Lien Ho
area on the mainland opposite
Tateng Island, and apparently
have silenced many of':them.
The Chinese Nationalists' con-
centrated firing is apparently
based on the theory that heavy
damage to one area will injure
Communist morale more than
light damage in scattered areas.
Nationalist fire on 3 January
was believed to be particularly
effective; the-Nationalists
claim 19 artillery positions
and two ammunition dumps de-
stroyed by a barrage that in-
cluded a large number of eight-
inch projectiles.
Recent statements by Na-
tionalist Chief of Staff Wang
Shu-ming referring to the re-
cent Communist amphibious ex-
ercise near Amoy suggest that
considerable concern has been
aroused in Taipei. However,
Chiang Kai-shek's statement
on 16 January that the Chinese
Communists will bear watching
during the next few weeks ap-
pears to be designed to divert
American attention from the
Mikoyan visit to the United
States and the Berlin situation
to the strait situation.
During the relative quiet
since the bombardment of 7 Jan-
uary, Peiping has continued
propaganda broadcasts and po-
litical efforts through Hong
Kong to erode Nationalist morale
and divide the United States
and Taipei. To this end, empha-
sis is being placed on alleged
American efforts to replace
Chiang Kai-shek with a more
pliable ally through backstage
maneuvering with a "third force."
The Chinese and American
negotiators in Warsaw are now
meeting once a month rather
than twice a month. The next
meeting is to be held on 13
February. At the 9 January meet-
ing, Ambassador Wang Ping-nan
repeated Peiping's demand that
the discussions concentrate on
the withdrawal of American
forces from the strait.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
GENEVA TALKS
Nuclear-Test Cessation
The decision by Britain
and the United States on 19
January to abandon their posi-
tion linking duration of the
test cessation with satisfac-
tory progress on disarmament
was received favorably by So-
viet chief delegate Tsarapkin,
who, however, again demanded
that the West introduce its
draft article on duration it-
self. Tsarapkin stated that
this modification of the West-
ern position made prospects for
a treaty "brighter." He charged,
however, that dropping this con-
dition eliminated only one of
the weakest points in the West-
ern posture.
In a press interview on
20 January, Tsarapkin minimized
the importance of the Western
move and reiterated the Soviet
demand for "a permanent agree-
ment free from conditions." He
alleged that the United States
and Great Britain, by continu-
ing to insist on linking dura-
tion of such agreement to peri-
odic review by the three powers
of the functioning of the con-
trol system, were seeking a
treaty from which they could
escape at will.
Despite the Soviet dele-
gate's daily reiteration of
Moscow's stand on a permanent
unconditional agreement, the
negotiations have proceeded at
a somewhat more rapid pace in
the past week than at any time
since they resumed on 5 January.
The Soviet delegate agreed on
19 January to discuss Western
draft articles on control, but
he asserted that any real prog-
ress would depend on settle-
ment of the key questions of
duration, voting procedures in
the control commission, and
staffing of the control posts.
On the second "key question,"
Tsarapkin stated that the So-
viet delegation is prepared to
provide a list of decisions--
which it believes tust be sub-
ject to the "unanimity rule"--
as soon as the West introduces
its draft on the first question.
Discussions on 20 January
centered on the third question--
particularly the issue of inter-
national vs. national staffing.
Before the session began, the
Soviet delegation forwarded
Written questions to its West-
ern counterparts requesting
that they clarify at the meet-
ing their position on inter-
national staffing of control
posts and barring of nationals
from certain positions at these
posts in their own countries.
After the American dele-
gate presented the Western posi-
tion, Tsarapkin suggested the
prospect of compromise on this
issue, but warned that any res-
olution must be made on the
basis of national staffing
plus controllers from the "other
side." In the long run, the
Soviet leaders probably would
agree to any compromise which
would guarantee continued So-
viet control of the activities
of personnel stationed on bloc
territory.
Soviet propaganda contin-
ues to accuse the United States
and Great Britain of trying to
block the negotiations. A
commentary on 20 January, similar
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
in nature to a prepared state-
ment read by the Soviet delegate
on the same day, dismissed the
latest Western move as "another
of those wearying examples" of
tactics used to avoid agreement.
The commentary charged that be-
fore relinquishing this "road-
block," the Western delegates
introduced an even more formid-
able one--the American paper on
the difficulty of detecting
underground' nuelear explo-.
sions.
Surprise-Attack Talks
Soviet reaction to the
Western rejection of Moscow's
overture to reconvene the sur-
prise-attack talks has been
confined to propaganda media.
On 20 January Izvestia charged
the Western powers th sab-
otaging the talks when it be-
came obvious that the negotia- 25X1
Lions would not be a source
for intelligence informal
on the Communist bloc.
(Concurred in by OSI)
RESULTS OF THE NENNI SOCIALIST CONGRESS
The victory of Pietro
Nenni's "autonomists" over the
pro-Communist faction at the
Italian Socialist party's con-
gress in Naples will have im-
portant long-range political
consequences if Nenni can build
an effective non-Communist
left in Italy. Nenni's in-
creased appeal to a number of
left-wing Democratic Socialists
is already evident, but even
if their defection to his party
should result in the overthrow
of the Fanfani government, his
party's participation in a suc-
cessor coalition is not antici-
pated.
Nenni's faction now has
control of his party's central
committee, with 47 of the 81
seats, and of the party direc-
torate, with all its 15 seats.
Nenni will probably prefer not
to disrupt the national polit-
ical scene immediately while he
is consolidating his position.
Nevertheless an immediate threat
to the government could result
from the attitude of left-wing
Democratic Socialists, who have
been anxious for a rapproche-
ment with the Socialists.
Even if the governing
coalition is weakened by defec-
tions, Socialist support would
still be possible on socio-
economic reform measures which
right-wing Christian Democrats,
oppose,' and the Socialists could
sustain Fanfani despite the op-
position of his own right wing.
On the other hand, fear of a
Christian Democratic rapproche-
ment with Nenni Socialists could
inspire the right-wing Christian
Democrats to topple Fanfani at
once.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
In any event, no early
participation of the Socialists
in a government coalition is in
prospect. If Fanfani is over-
thrown, he is likely to be suc-
ceeded by a minority Christian
Democratic government depend-
ent on the Liberals and Mon-
archists or a coalition of the
Christian Democrats with Demo-
cratic Socialists and Liberals
supported by the Monarchists.
Both of these possibilities
could be exploited by Nenni to
establish the Socialists as the
principal democratic opposition.
Nenni's objective will be
to attract the Democratic So-
cialists as well as dissident
Communists, and to hang on to
his own party, To do this he
will be forced to proceed with
caution, equivocating where nec-
essary and permitting continued
ties with the Communists in the
local governments, and in the
General Confederation of Labor,
where the Socialists are seek-
ing a greater voice. His ability
to orient his party away from
the Communists can be measured
by its success in providing a
loyal opposition which can sup-
port the Christian Democratic
government on crucial issues.
It can also be gauged by the
extent to which pro-Communists
are eliminated from local and
federation posts, and in the
policies the party daily Avanti!
In Libya, Arab nationalist
sentiment, vigorously supported
by UAR President Nasir's prop-
aganda machine
lis steadily
gaining ground. Pro-Nasir of-
ficials now occupy important
positions in both the central
government and the provincial
governments of Tripoli and Cy-
renaica, and plotting against
the regime continues.
Prime Minister Abd al-Ma-
jid Kubaar, whose initial pol-
icies were basically pro-Western,
has tended more and more to cater
to the popular attitude. In
his speech from the throne on
30 November, Kubaar capitalized
on a few words of praise for
the Libyan Government includes'.
in Nasir's lengthy 27 Novembc:v
address and announced that
"friendly and fraternal relations
with the brother United Arab
Republic have increased in
strength." Press media in both
countries followed with an ex-
change of compliments.
Libyan Defense Minister
Shaaban is scheduled to go to
Cairo on 24 January to obtain
tanks, armored cars, and heavy
machine guns from the UAR. F
Nasir presented the King with
six armored cars for his personal
bodyguard in October 1957.
Kubaar has given a good
deal of press play recently to
the long-standing Soviet'econo-
uic aid offer, which reportedly
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
includes a $28,000,000 credit.
On 7 January, the government's
press office announced that the
Council of Ministers had formed
an ad hoc committee to "study
and discuss" the offer. At the
same time, Kubaar is negotiating
for more US economic aid and for
a revision of the financial
clauses of the American base
agreement.
The continuing pro-Western
attitude of King Idriss makes
unlikely any immediate decision
for closer relations with the
USSR. Nevertheless, conscious
of the trend of popular opinion,
the Council of Ministers may now
for the first time give serious
consideration to the tempting
Soviet aid proposals.
The 69-year-old King has
made no real effort to build up
the power and prestige of his
successor designate, young Prince
Hasan al-Rida. Only the personal
loyalty to the King of most key
political, tribal, and military
figures keeps the present govern-
ment in power. Yet, in spite of
warnings on deteriorating in-
ternal security, the King shows
no inclination to take resolute
action. (Concurred in 25X1
by ORR)
The Greek and Turkish for-
eign ministers following their
talks in Paris from 18 to 20
January are cautiously optimis-
tic about the possibility of a
Cyprus settlement. These and
other exchanges of views be-
tween Greece and Turkey, which
have occurred since mid-December,
have resulted in agreement on
several provisions for a settle-
ment based on some form of guar-
anteed independence for the
island. Previous Turkish insist-
ence on a military base on Cy-
prus--occupied solely by Turkish
troops or by Turkish, Greek,
and British forces--may be modi-
fied. This could lead to a
compromise on this issue which
might involve the creation of a
NATO base.
The cordial atmosphere in
which the foreign ministers'
negotiations took place and the
changed attitude of the press
in both countries toward an ac-
commodation indicate that both
governments now wish to resolve
the Cyprus issue. The influen-
tial editor of the Turkish news-
paper Vatan is in Greece with
the full support of the Turkish
Government in an attempt to im-
prove Greek-Turkish relations.
Important newspapers in both
countries have recently empha-
sized the common problems
facing their nations and have
recalled the friendship exist-
ing before the Cyprus problem
became paramount in their re-
lations.
While Greek relations with
Turkey seem improved, there is
no corresponding improvement
in relations between Athens and
London. The Greek Government
has repeatedly blamed the Brit-
ish for trying to sabotage the
Greek-Turkish rapprochement,
and both Greeks and Greek Cyp-
riots are bitter over British
failure to proceed faster to-
ward ending emergency regula-
tions on Cyprus.
Greek Cypriots are also
incen?ed by rumors that the
British will Soon publish a
report recommending that the
Greeks and Turks be given sep-
arate municipal governments
in the five major towns on Cy-
prus. EOKA, however, apparent-
ly remains committed to observe
its self-proclaimed truce of
24 December.
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22 January 1959
ARGENTINE LABOR UNREST
The protest general strike
in Argentina which began on 18
January was called by Peronista
and Communist-influenced unions
primarily to undermine Presi-
dent Frondizi's policies and
embarrass him during his visit
to the United States. The
strike received support, how-
ever, from other labor elements
which strongly object to the
sharp price rises since the in-
itiation on 1 January of the
US-backed austerity and stabi-
lization program.
The effectiveness of the
Peronista strike call, esti-
mated at 80 percent on its
second day, was enhanced by
the lack of other than rail-
road transportation in many
areas, by the closing of many
businesses, and by the support
of some independent labor sec-
tors. In view of the growing
discontent among labor--gen-
erally over rising prices--
the strike was joined on a 48-
hour basis even by a few unions
of the anti-Peronista bloc,
which is concerned over its com-
petitive position in the in-
complete trade-union elections.
Much of the labor unrest
over the past few months de-
rives from confusion and fac-
tionalism within organized
labor, and it was partly for
this reason that Frondizi sup-
ported the new basic labor law
of last August calling for a
central labor organization and
new elections in all unions.
Anti-Peronista elements, how-
ever, have denounced the law
and election procedures as
favoring Peron's former sup-
porters, who used organized
labor as an instrument for po-
litical control.
This dispute has delayed
elections and encouraged anti-
Peronista leaders to call a
few strikes to prove they are
looking out for labor's wel-
fare. Because of this contro-
versy and the opposition to
the stabilization program, la-
bor unrest is likely to con-
tinue for some time.
trolling the situation,
The Communists are ap-
parently supporting the Peron-
ista drive for trade-union
control in the hope of obtain-
ing important positions within
the unions. In view of the
party's membership of only 80,-
000 to 90,000, this tactic
would increase their influence
more than would a drive for
union leadership in competi-
tion with the Peronistas who,
although split among them-
selves, are believed to be
the largest single group. The
government holds the Communists
partly responsible for the pres-
ent unrest and raided the par-
ty's headquarters while round-
ing up strike leaders.
Since the country is still
under state of siege, the military
forces are taking firm measures
--including the mobilizing of pe-
troleum and transport workers
--to suppress further strikes or 25X1
violent demonstrations. The
armed services seem capable of con-
CASTRO MAY AID OPPOSITION TO LATIN AMERICAN DICTATORS
The new Cuban Government,
even before it has had time to
become effectively organized,
is under pressure to provide
material support for revolu-
tionary action against the re-
maining Latin American dicta-
tors. A few days after the
fall of Batista, exiles from
various authoritarian regimes
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
began arriving in Cuba seeking
support for their plots.
The new Cuban leaders,some
of whom have already publicly
indicated their sympathy for
the efforts of other Latin Amer-
icans to overthrow their dic-
tators, now are chiefly con-
cerned with consolidating their
own government. The tendency
in the government to refer all
decisions to Fidel Castro is
seriously hampering effective
administration and causing re-
sponsible officials to become
increasingly frustrated and
disillusioned. Raul Castro,
who commands the armed forces
in Oriente Province and is the
only rebel commander known to
have acted independently of, his
brother's orders on occasions
during the civil war, is in-
clined to rash actions and may
cause difficulties.
As the government becomes
consolidated, there will prob-
ably be a strong temptation to
aid revolutionary groups of
other Latin American countries.
Generalissimo Trujillo of the
Dominican Republic, who was
openly sympathetic to Batista
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and granted him aslyum, is
probably the dictator most
hated by the new Cuban leaders.
Nicaraguan exiles recently ar-
rived in Cuba, however, are
reported to be seeking Castro's
aid for a prior invasion of
Nicaragua. 25X1
"General" Miguel Angel
Ramirez., chief of the long-
dormant Caribbean. Legion which
he is attempting to reactivate,
arrived in Cuba 25X1
The Legion, an irregular mili-
tary force of professional rev-
olutionaries and idealists dedi-
cated to ousting area dictators,
was active a decade ago, and
Ramirez led an abortive plot
in 1947 against Trujillo in
which Fidel Castro, then a 21-
year-old student, took part.
In Haiti, where President
Duvalier's distrust of the
army has forced him to rely on
his unpopular civilian mili-
tia the opposition appears to
be looking to Fidel Castro for
support:
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
PORTUGAL'S GROWING DISSATISFACTION WITH SALAZAR
Antonio de Oliveira Sala-
zar, premier and virtual dic-
tator of Portugal since 1932,
is facing increasing popular
dissatisfaction-with the coun-
try's economic and political
stagnation. Popular opposition
to his regime appeared on an
unprecedented scale during and
following last May's presidential
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
election campaign, and even
supporters of the present form
of government are becoming con-
vinced it is time for a change.
There are rumors that the pre-
mier will retire next April
on his 70th birthday, but
Salazar seems resolved to stay
in power, and there appears
to be no group at present pre-
pared to oust him.
in the Finance Minis-
try in 1928, and
Portugal's fiscal
and monetary system
and its banking struc-
ture are still fun-
damentally designed
to prevent a:recurrence
of the inflation the
country suffered in
the 1920s. Stability
has been maintained
at the expense of
economic expansion.
In the era of the
OEEC and the emerg-
ing Common Market, a
growing number of
Salazar's countrymen
are concerned over
the fact that Portugal
has the lowest stand-
ard of living in
Western Europe and
that ' its rate. of
economic growth is consider-
ably below that of most of
the other less-developed OEEC
countries.
The restrictive tendencies
of the Portuguese corporative:
state have aggravated the stag-
nation of the economy. The
corporations, in which both
labor and management are rep-
resented, are in fact dominat-
ed by the government; with
strikes forbidden and wages
consistently low, there is
little pressure to raise pro-
ductivity. Limitations on the
exercise of free enterprise
and local suspicion of foreign
capital and industrial innova-
tions keep opportunities for
foreign private investment to
a minimum.
The long-standing curbs
on freedom of the press and
other democratic processes
have apparently served to keep
the Salazar regime itself igno-
rant of the extent of popular
discontent. It seemed genu-
inely surprised at the active
campaign for the presidency
conducted by General Humberto
Delgado in May and June, and
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POLAND
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
by the widespread political
and social unrest revealed by
the rioting in Lisbon and
Oporto at that time.
Opposition to Salazar Regime
Avowed opposition to the
Salazar government continues
to make itself felt. Delgado's
ability to supply effective
leadership to the opposition
is increasingly questioned,
however, in view of his unre-
strained public utterances and
generally eccentric behavior
since he lost the election.
Delgado--now in political a-
sylum in the Brazilian Embassy
in Lisbon--is reported to have
alienated much of the support
he enjoyed in mid-1958, al-
though his prestige still ap-
pears to be high in Oporto,
the industrial and commercial
capital and traditional center
of antiregime activity. Op-
position leaders there regard.
him as one of the most likely
candidates to head a new
government should Salazar re-
tire soon.
governments for having given
financial and diplomatic sup-
port to Salazar since the end
of World War II.
Proregime Critics'
An increasing number of
regime supporters are concerned
over Salazar's reluctance to
undertake any extensive changes 25X1
These leaders believe
political parties could be
effectively organized as soon
as Salazar steps down so that
elections could be held within
six months. They envisage
Christian Democratic and Demo-
cratic Socialist parties as
the most likely successors to
the Salazar-controlled National
Union and they maintain that
under a government sponsored
by them there would be. no
legal provision for a Commu-
nist party. They say they had
discussed the possibility of
common action with the Commu-
nists but then rejected the
idea. They dismiss the Portu-
guese Communist party as very
weak, with perhaps 100 or 200
members and no following.
These Oporto opponents
of the regime maintain that
they are the true anti-Commu-
nists in Portugal, and they
are somewhat critical of the
United States and other Western
early retirement. For example,
Many junior officers are dis-
satisfied because politics de-
termine promotions and harsh
measures were taken against
opposition election rallies
in May. Discontent among the
military probably inspired a
circular issued in November
by opposition elements in
Oporto to army personnel, urging
cooperation in a move to oust
Salazar.
The Roman Catholic hier-
archy in Portugal also has mis-
givings over the premier's
policies. The cardinal patri-
arch of Lisbon advised Salazar
that by failing to give other
men a chance in the government
he was throwing the country
into the hands of the Commu-
nists. The bishop of Oporto,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
in a letter to Salazar in mid-
July, declared that some as-
pects of the regime's social
policies were in conflict with
church doctrine and, in effect,
he proposed the creation of a
Catholic party.
Formal criticism of
government policies has also
come in recent months from a
group of Coimbra University
professors and from the Por-
tuguese Legion, a semiofficial
organization with some civil
defense and domestic espion-
age duties. Even members of the
National Union agree that the
government must do something
to win popular confidence.
The Oporto health commissioner
complained in November that
the regime is "out of touch"
with the people.
The American Embassy in
Lisbon believes that "it is
indeed the disheartened of
the regime that pose the
biggest threat to Dr. Salazar."
Embassy officials sense that
a regrouping of ."forces'.: is
under way in government circles.
Defense Minister "General
Botelho Moniz, ex-defense
minister Colonel Santos Costa,
and former minister of the
presidency Marcelo Caetano are
apparently intent on strength-
ening their individual posies'
tions in order to qualify as
likely successors to Salazar.
Prospects
Salazar seems resolved
to remain on the job. His
appointment of Colonel Arnaldo
Schulz, a "strong-man" type,
as interior minister on 28
November suggests that he wants
rigorous treatment of opposi-
tion attempts to arouse public
sentiment against the regime.
This seems evident also in the
arrest in November of four
well-known liberals who were
jailed for a week, allegedly
for subversive political ac-
tivity, but actually for having
signed a public protest against
the government's refusal to
allow Aneurin Bevan to lecture
in Lisbon. By boosting mili-
tary and civil service salaries
10 to 43 percent on 1 January
to equate salary levels more
nearly to the cost of living,
Salazar has moved to strength-
en the, loyalty of function-
aries to the regime.
Salazar is unlikely to make
any real concessions to popu-
lar demands. His 6 December
speech before the National
Union suggests that he is de-
termined to "see things through"
along established policy lines.
The speech was basically a
plea for the party to inspire
enthusiasm for the regime. It
reflected concern and annoyance
over internal political develop-
ments but warned, with a ref-
erence to the bishop of Oporto's
critical letter, that unless
those responsible fpr church
doctrine brought deviators
into line, the sphere of church
action would be limited.
Should the bishop of
Oporto be forced out of his
office, as a Foreign Ministry
official intimated in mid-
November, the battle lines
might be drawn between church
and regime. The conservative
Catholic press, commenting
on Salazar's 6 December speech,
declared 'that' ifidividual
priests have the right to ex-
press themselves even on po-
litical subjects. It had pre-
viously declared that the
church cannot abdicate its
right to state the needs of
social justice, even at the
risk of displeasing those in
power, and that it would fail
to fulfill its mission if it
allowed itself to be identified
with a particular regime.
supporters.
Widespread as the dissatis-
faction against Salazar appears
to be, however, no group yet
seems ready to act on it. In
any event, it is questionable
whether the opposition, despite
its high estimate of its own
potentialities, can win suf-
ficient support from the army
to effect a coup. Effective
moves to modify or replace the
present regime will probably
come from among its present
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CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
CHINESE COMMUNIST MILITARY DEVELOPMENTS DURING 1958
Taiwan Strait
The military operation in
the Taiwan Strait showed that
the Chinese Communists have
made progress in combined arms
operations and highlighted the
power of their artillery against
the offshore islands. It also
demonstrated, however, a sub-
standard performance of their
air force against the Chinese
Nationalists, despite the oc-
cupation of the coastal air-
fields by Communist fighters,
which greatly inhibited Na-
tionalist overflights.
On the basis of equipment
and numbers, the Communists
should have made a much better
showing, but inferior air tac-
tics, resulting from poor or
incomplete pilot training, and
a lack of aggressiveness caused
them to lose 33 aircraft as
against only four Nationalist
fighters, including two recon-
naissance aircraft. Nationalist
pilots indicated that Communist
planes did not give the perform-
ance which would be expected
from MIG-17s, when flown by
skilled pilots.
Taipei's use of the Side-
winder air-to-air missile may
have given the Communists pause
in engaging Nationalist fight-
ers.
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,Vol *.Woof
CURRENT INTELLIGENCE WEEKLY SUMMARY
22 January 1959
brought into the Fukien area
during the crisis reflect an
The Chinese Communist Navy
did not directly participate
in the crisis except to use
motor torpedo boats against Na-
tionalist supply vessels.
The large numbers of troops
improved logistics capability.
pendence on Moscow in its drive 25X1
Chinese War Production
Withdrawal From North Korea
In a joint communique on
18 February 1958, Chou En-lai
and Kim I1-sung announced the
Chinese Communists would with-
draw from North Korea. Subse-
quent announcements from Pei-
ping stated that the withdrawal
would be completed in three
stages, with the final phase
to be completed before the end
of 1958. Chinese Communist.:
troops in North Korea at that
time totaled about 300,000 and
included five armies--the 1st,
16th, 21st, 23rd, and 54th.
The first phase oft ' the
withdrawal, involving the loth
and 23rd armies, was completed
during March and April; the
second stage in August with
the withdrawal of the 21st and
54th armies; and the third
stage on 26 October. Two of
the armies--the 16th and 23rd--
are believed to be in Manchuria,
while the others may have been
deployed to South and Southeast
China. There are reports that
some troops may have been sent
to Tibet.
Soviet Military Aid
Soviet military aid to Com-
munist China continued on a
fairly large scale during 1958,
but indigenous war-production
facilities were also expanded--
thus decreasing Peiping's de-
Chinese Communist facili-
ties now are producing mortars
up to 160-mm.caliber,;and various
artillery pieces, iy program of
construction of Soviet-designed
warships, begun in 1955, ap-
parently continues.
Organizational Changes
Other developments during
the year include the reorgani-
zation of'certain administrative
and supply organizations and
the implementation of a reserve
program which is to be respon-
sible for training the militia.
The "rectification" cam-
paign, which affected virtually
all aspects of Chinese Commu-
nist life, increased party con-
trol over military command and
administration at all levels.
Other results of the "rectifi-
cation" program last year were
increased emphasis on the study
of Communist doctrine and the
return of Chinese Communist of-
ficers to the ranks for at
least one month a year.
Current Capabilities
The continued Soviet sup-
port in the form of material
and technical aid to the Chi-
nese Communist armed forces and
the strides being made by the
Chinese Communists to achieve
greater independence by the ex-
pansion of their own war-pro-
duction facilities foreshadow
an ever-increasing military
threat in the Far East. Despite
the great strides obeing made,
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22:-QJanuary l9b?'.
however, there are several
areas where improvements will
be necessary before Peiping
can rank as a first-rate mili-
tary power. Thus far the princi-
pal element of Peiping's mili-
tary power is its large ground
force, in size second only to
Moscow's.
This force relies largely
on overwhelming the enemy by
numerical superiority, but it
is not prepared to wage a nu-
clear war nor defend against a
nuclear attack: 'Althdugh.there
have been numerous reports of
missile installations, there is
no firm evidence that Peiping
possesses operational tactical
missiles.
The principal weakness in
the Chinese Communist Air Force
seems to be inadequate pilot
training.
The navy, although it has
received modern types of Soviet-
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designed vessels from its own
shipyards, will continue-to re-
main principally a coastal de-
fense force for some time to
come. The lack of experience in
deep-water operations and the
limited number of deep-water
vessels are factors which will
restrict the development of a
naval threat for some time to
come.
Although there are many
vessels which could be used to
stage an amphibious assault
against the offshore islands,
the type of lift capability
necessary to mount an invasion
of Taiwan itself is inadequate,
and this deficiency is not likely
to be soon remedied. The Chinese
Communists have, however, the
capability to undertake opera-
tions against the offshore is-
lands at any time and, if not 25X1
opposed by American forces, could
press these operations to a suc-
cessful conclusion.
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