CURRENT INTELLIGENCE WEEKLY SUMMARY

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A002300090001-8
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• Document Creation Date: December 20, 2016
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• Publication Date: October 19, 1999
• Content Type: SUMMARY

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CONFIDENTIAL
SECR?~
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 56
OCI NO. 3529/59
16 July 1959
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CENTRAL INTELLIGENCE AGENCY
I I 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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CONFIDENTIAL '
CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
T H E W E E K I N B R I E F
OF IMMEDIATE INTEREST
EAST-WEST NEGOTIATIONS . . . . . . . . . . . . . . . . . . Page 1
As the Geneva conference reconvened on 13 July,
Foreign Minister Gromyko took the line that prospects
were favorable for an interim agreement on Berlin.
Gromyko insisted at the 15 July session on linking any
Berlin settlement to the establishment of an all-German
committee. Soviet spokesmen at Geneva have hinted that
the USSR may. seek to win Western agreement to an all-
German committee by offering to make such an organ sub-
ordinate to a four-power commission on the German problem.
THE CARIBBEAN AREA . . . . . . . . . . . . . . . . . . . . Page 5
Tension continues high in the Caribbean area, and
further serious outbreaks of violence are possible before
the impending special conference of the American foreign
ministers can act on the Caribbean crisis. The unsuc-
cessful coup in Honduras on 12 July was symptomatic of
the problems that trouble the area, but was not directly
related to the wider crisis. The Cuban Government remains
determined to oust the Trujillo dictatorship in the Domin-
ican Republic, and Cuban exiles claim to be nearly ready
MIDDLE EAST HIGHLIGHTS . . . . . . . . . . . . . . . . . . Page 7
Iraqi Prime Minister Qasim has apparently sought to
reduce the force of Communist opposition by appointing
to his cabinet four more leftists, three of them closely
associated with the Communists. He also announced that
party activity will be permitted to resume before next
January and that Iraq's "transitional period" will end
some time next year with the election of a "national
council." Although the new cabinet is a disappointment
to army officers who had hoped for a purge of the Commu-
nists, other non-Communist elements do not appear to be
particularly discouraged by these moves. In Iran, the
Shah and the prime minister maintain firmness in the
face of continuing Soviet pressures. The Sudanese Gov-
ernment has lost prestige as a result of its conduct of
the recent treason trials, and a political climate favor-
able to renewed dissidence.: may be developing.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
NOTES AND COMMENTS
SOVIET MIDYEAR ECONOMIC REPORT . . . . . . . . . . . . . Page 1
The TASS summary of the report on the USSR's economic
performance during the first six months of the Seven-Year
Plan indicates good progress toward the plan's goals, with
the possible exception of agricultural output. Total
industrial production is reported to be 12 percent over
the corresponding period of last year. Six-month statis-
tics in the past have usually been a reliable indication
of performance for the full year. The Seven-Year Plan
calls for an average annual increase of 8.6 percent.
Industries overfulfilling their plan included pig iron,
steel, rolled metal, iron ore, nonferrous metals, machine
tools, electricity, coal, and oil. In agriculture, re-
ported overfulfillment of the state purchase plan for
livestock products and of spring sowing are the results
of good feed supplies from the 1958 bumper crop and of
an early dry spring.
PROBABLE NEW SOVIET MISSILE INSTALLATION IN EAST GERMANY . Page 2
Soviet military equipment of an unusual type, thought
to be semimobile surface-to-air missile launchers, has
been observed at Glau, about 15 miles southwest of Berlin
in East Germany. Such launchers, which the Soviet Union
apparently is introducing into operational units, would
be considerabl more flexible than system in the
Moscow area.
RECENT SOVIET HIGH-ALTITUDE ROCKET FIRINGS . . . . . . . . Page.3
ment v, experiments involving the.vertical launching of
INCREASED BLOC-ETHIOPIAN ECONOMIC TIES . . . . . . . . . Page 4
The USSR and Ethiopia, in a joint communique issued
at the end of Emperor Haile Selassie's recent visit to
the Soviet Union, announced that Moscow has granted a
$100,000,000 credit to Addis Ababa for industrial and
agricultural development. The credit is presumably in-
tended for Ethiopia's planned $300,000.000 economic devel-
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
PART II (continued)
CZECHOSLOVAKIA TO ELIMINATE PRIVATE PLOTS ON COLLECTIVE
FARMS . . . . . . . . . . . . . . . . . . . . . . . . . . Page 5
As Czechoslovakia continues a mopping-up campaign
to bring the nation's remaining private farmers--now
cultivating less than 20 percent of all agricultural
land--into the "socialist sector," the regime also is
preparing to take over the private garden plots which
have supplemented the incomes of collective farmers and
kept up their morale. This highly unpopular move will
probably stimulate a migration to cities and further ham-
per the thus far unsuccessful efforts to raise agricul-
tural production above the prewar level.
RUMANIA INTENSIFIES CONTROLS . . . . . . . . . . . Page 6
The Rumanian campaign to tighten internal controls,,
initiated at the June 1958 plenum of the central committee,,,
has increased in intensity. Designed at first to combat
economic crimes, it has been aimed more and more at polit-
ical unreliables and potential security threats,, and. has
caused near terror among some elements.of the population.
Intensification of the crackdown may lead to an increase
in internal tension, but this will pose no serious threat
SEVENTH WORLD YOUTH FESTIVAL . . . . . . . . . . . . . . Page 7
The first Communist-sponsored World Youth Festival
outside the Communist bloc is scheduled to take place in
Vienna from 26 July to 4 August. The Communists took a
calculated risk in deciding to hold the festival in a free
world city where there is strong anti-Communist public
opinion and a wide potential for counterattractions, but
they probably want to put these festivals and their spon-
soring front organizations in a better :Light by maintain-
ing the impression they are of a nonpolitical nature.
Special arrangements are being made to separate Communist
bloc delegates from non-Communist youths and to avoid
seminars on controversial subjects.
NEW AUSTRIAN GOVERNMENT . . . . . . ? . . . . . . . . Page 8
Last-minute intervention by President Adolf Schaerf
has given Austria'.s.13-year-old coalition between the
People's party and the Socialists another lease on life.
The new government, in which increased 'Socialist influence
is the salient feature, is not likely to be as stable as
its predecessors in view of the tensions between the two
parties, the divisions within the People's party, and
Chancellor Raab's weakened position. The new Socialist
foreign minister, who is strongly pro-Western, favors
patterning Austria's neutrality more closely on the Swiss
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
PART II (continued)
KERALA . . . . . . . . . . . . . . . . Page
Most leaders of India's Congress and Communist
parties apparently expect New Delhi to suspend parliamen-
tary government in Kerala State within a month, although
no firm decision has yet been made. Congress party chiefs
are trying to prepare a strong legal case for intervention
and to organize the party in Kerala for eventual elections.
Communists are planning retaliatory agitation in other
key states--including nationwide "demonstrations" for 21
July--but reportedly will refrain from violent action in
line with recent guidance from Moscow. The scope of
anti-Communist demonstrations in Kerala is growing, in
response to which the Communists are using increasingly
INDONESIA'S NEW CABINET . .
. . . . . . . . . . Page 10
The new Indonesian cabinet formed by President
Sukarno is basically conservative, although five of the
nearly 40 members are known to be leftists of varying
hues. The army's increased representation affords it
a greater opportunity to push its avowed aim of under-
cutting widespread Communist influence and activities.
Underlying stresses are indicated by the Communist party's
grudging support of the new government, and by air force
criticism of the army's enhanced position.
COMMUNIST TERRORISM IN SOUTH VIETNAM . . .
Page 11
The recent attack on an American MA.AG detachment near
Saigon highlights the security problem that has long
plagued South Vietnam and may presage a new phase of Com-
munist violence there. South Vietnam's security forces
have been hard put to suppress sporadic acts of Communist
terrorism, which has kept the government off balance and
retarded essential progress in the economic field. Recent
Communist propaganda has had a threatening tone toward
American activities not only in South Vietnam but also
in Laos, where an American military training mission is
PEIPING ANNOUNCES REFORM PROGRAM IN TIBET Page 12
Peiping has announced a two-stage program of "demo-
cratic reform" in Tibet which is aimed at the ultimate
destruction of the institutions most opposed to Chinese
rule. The first objectives are an end to unrest in
Tibet and the elimination of feudal practices by the
upper classes and monasteries. The second step will be
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
PART II (continued)
redistribution of land. No time schedule has been an-
nounced, and Peiping--perhaps deliberately--has not made
clear what form land distribution will take.
REPATRIATION OF KOREANS IN JAPAN TO NORTH KOREA . . .
Leftist pressures and public opinion in Japan are
so strong that the Japanese Government will eventually
. Page 13
repatriate some Koreans in Japan to North Korea, With or
without International Red Cross (ICRC) participation.
The ICRC is inclined to assist the repatriation, al-
though it has not yet approved the Japanese - North Korean
plan and is concerned that a hasty decision will involve
it in the "cold war." North Korea continues to attack
Japan for refusing to sign the agreement prior to ICRC
approval. President Rhee is opposed to offering any
constructive program for repatriation to South Korea.
DEVELOPMENTS IN BRAZIL'S FINANCIAL CRISIS . . . . . . . . Page
The divergence between Brazil and the International
Monetary Fund (IMF) on the terms of a stabilization
program has widened in recent weeks despite the efforts
of the Brazilian Finance Ministry to formulate mutually
acceptable proposals as a basis for reopening loan talks.
Recent Brazilian actions with respect to credit policy
and coffee financing will add to the budget deficit and-
inflationary pressures already under attack by the IMF.
A 60-day. loan of $50,000,000 from the Federal Reserve
Bank of New York, granted on l0.July, has,postponed any
immediate Brazilian default on international debts but
THE SITUATION IN PERU . . . . . . . . . . . . . . . . . . Page
Peru's cabinet crisis, which followed a sharp opposi-
tion attack in June on the government's financial policies,
has apparently ended with the appointment of Pedro Beltran,
owner of the independent conservative daily La Prensa
of Lima, as prime minister and minister of finance.
Beltran has been strongly critical of the Prado govern-
ment's economic and financial policies and may attempt
to revise them with a view to reducing ;government con-
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PATTERNS AND PERSPECTIVES
KHRUSHCHEV'S LIEUTENANTS . . . . .
Page I
Khrushchev's principal lieutenants play a major role
in the formulation of Soviet policy and the broad admin-
istration of the Soviet state. The relative importance of
their current positions and duties, in terms of providing
experience and opportunities for building up a personal
following, is viewed as indicative of their prospects.
Khrushchev has said that Frol Kozlov will be his eventual
successor, but it remains to be seen whether Kozlov will
remain in favor.
OIL IN NORTH AFRICA . . . . . . . . . . . . . . . . . . . Page 6
Oil fields discovered in North Africa, close to
European markets and free from dependence on the Suez
Canal, will provide Western oil companies with a counter
to the growing demands of the established oil-producing
Arab states for higher revenues and a ]Larger role in
management. Although oil prospects in Morocco and Tunisia
have not been encouraging, Algeria and Libya are expected
by the end of 1961 to become major world oil producers,
with a combined output of 500,000 barrels per day, equiv-..
alent to about one third of Kuwait's current production.
Algeria's crude-oil production is now limited to only
11,000 barrels a day by inadequate transportation.
Libya's oil output may reach a total of 100,000 barrels
per day by early 1961. Paris has some basis for its hope
that Algerian production will exceed a million barrels
daily by 1970.
WESTERN EUROPE'S PROPOSED LITTLE FREE TRADE AREA . . . . . Page 11
The "Outer Seven"--Britain, Denmark, Norway, Sweden,
Austria, Portugal, and Switzerland--will meet in Stockholm
from 20 to 22 July to agree on terms for a little Free
Trade Area (FTA). Britain's major objective in sponsoring
this move is to induce the Common Market countries--France,
West Germany, Italy, and the Benelux nations--to reconsider
their rejection of a larger Free Trade Area. Britain
refuses to subscribe to the supranational controls
required for membership in the Common Market. While
West Germany and the Benelux countries would favor close
coordination in a larger FTA, the slight impact of a
little FTA on France's exports would not be sufficient
to induce France to modify its opposition to a larger
economic grouping,
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CONFIDENTIAL.
CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
OF IMMEDIATE INTEREST
EAST-WEST NEGOTIATIONS
Soviet Foreign Minister
Gromyko, at the first session
on 13 July of the second phase
of the foreign ministers' con-
ference in Geneva, summed up the
Soviet proposals of 19 June
and made a bid to focus dis-
cussion on them. He asserted
that before,the recess 'the
proposals had not been an-
swered by the Western powers
and suggested that the confer-
ence resume where it had left
off, with a consideration of
them.
that the time limit on any in-
terim agreement is harmless by
suggesting that it would apply
only to the all-German commit-
tee and not to the duration of
Allied rights in Berlin. First
Deputy Foreign Minister Kuznet-
sov "affirmed categorically"
to the British ambassador on 9
July that Western rights would
be maintained during ?'enewed
negotiations, in ;the'event the
all-German committee failed to
reach agreement. '
But Gromyko hinted. that
the USSR might agree to adopt
the Western proposals of 16
June along with the Soviet pro-
posals of 10 and 19 June as a
basis for negotiation. In com-
paring both sets of proposals,
he commented,,one sees that
"there are points which are not
so far from each other."
At the 15 July session
Gromyko insisted on tying an.
interim Berlin settlement to
the establishment of an all
German .committee. He strongly.
maintained that creation of
such a committee was "indispen-
sable" for reaching any settle-
ment on Berlin, that the link
between the two questions was
"logical and vital," and that
it was not possible "to change
anything in this connection."
Soviet spokesmen are seek-
ing to create the impression
Gromyko, however, made it
clear in his public statement
on 28 June that a "definite
time limit will be established
for the temporary status of
West :Berlin and for the work
of the all-German committee."
He said the temporary status
agreement would be "designed
for a year and a half" and
specified that the "all-German
committee would have to com-
plete its work by the end of
that period."
On 13 July the Soviet for-
eign minister refused to drop
his insistence on a time limit
for negotiations by an all-
German committee on reunifica-
tion and a peace treaty, stat-
ing this would be "tantamount
to demanding from the Soviet
Union its consent to perpetuate
the occupation regime." When
questioned on Western rights
in Berlin after the expiration
of the time limit, he went no
further than 'his-'-28 June'
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16 July 1959
statement and again avoided
specifically reaffirming the
continuation of Western rights
in Berlin.
At the opening session,
the Soviet foreign minister
protested the holding of the
West German presidential elec-
tions on 1 July in West Berlin
as an example of the use of
West Berlin for purposes of
,subversion and aggravation of
tensions at a time when "the
West Berlin question" is being
negotiated and the Western
powers "quite correctly con-
firm" that West Berlin is not
a part of West Germany.
Taking advantage of an
opportunity to seek increased
international recognition of
the East ""German regime,
Gromyko replied to a Western
call at the first plenary ses-
sion for further restricted
meetings by stating that he
could not agree to attend un-
less East.Germany were includ-
ed. The Soviet press officer
stated in defense of this So-
viet tactic that last month's
restricted meetings were not
really "official"--they were
"unrecorded."
Ambassador Thompson be-
lieves Moscow will consider
the Western response to Gro-
myko's demand an indication
of Western unity and determina-
tion or lack thereof. Western
accession, he adds, would prob-
ably result in a stiffening in
the Soviet position on the sub-
stance of negotiations.
On 10 July the technical
working group on detection of
high-altitude tests presented
its agreed conclusions to the
plenary session. The report
recommended that five or six
earth satellites, ground con-
trol posts equipped with special
observing and measuring instru-
ments and, if thought necessary
later, four satellites in solar
orbits be employed to detect
possible high-altitude explo-
sions. It was agreed that the
report be submitted to the
three governments and, if favor-
ably considered, be incorporat-
ed by the conference in the
draft treaty.
The Soviet chief techni-
cal expert addressed the plen-
ary session on 10 July, noting
that; there had been a failure
to agree on only one out of
ten detection methods consid-
eredl. He emphasized that the
methods recommended in last
year's technical report had
been "reassessed" and "approved"
by the present technical work-
ing group. He then claimed
that, this tenth method, which
employs the use of radar, was
not technically necessary and
would enable an alien staff to
conduct spy operations.
Bloc propaganda is hail-
ing the experts' reports as
having proved that there are
"no scientific technical ob-
stacles in the way of banning
nuclear tests." Charging that
the high-altitude test problem
has been "one of the artificial
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CURRENT INTELLIGENCE WEEKLY SUMMARY
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obstacles" to agreement raised
by the Western powers, an 11
July Soviet commentary claimed
that its elimination now leaves
only the lack of good will in
the West in the way of agree-
ment.
On 9 July the Soviet dele-
gation at Geneva introduced its
draft article on a quota system
for on-site inspections in a
further effort to force discus-
sion of this concept. Although
the proposal itself contained
no new elements, the Soviet
delegate took the position that
each nuclear power would be
subject to the same number of
inspections on its territory,
thereby giving Moscow as many
inspections in each of the two
Western countries as the latter
would have jointly in the USSR.
He contended that this ar-
rangement was necessary because
the Western "side" was composed
of two countries in comparison
with only one from the East.
The Soviet delegate' asserted
further that it would be pre-
mature to extend the quota
system beyond the territories
of the three nuclear powers.
On 9 July the Soviet dele-
gation agreed on Vienna as the
site for the control organiza-
tion headquarters.
Western Attitudes
Gromyko's efforts to pre-
sent a picture of Soviet reason-
ableness have achieved consid-
erable success in Britain.
Prime Minister Macmillan and
Foreign Secretary Lloyd,'in
public statements before the
foreign ministers reconvened,
continued to present British
goals in modest terms. The
British accent now is on the
acceptability of a temporary
solution. There is also the
expectation that the foreign
ministers will arrive at some
formula that can be considered
sufficient progress to open
the way to a summit.conference.
Over 60 percent of those ques-
tioned in a late June Gallup
poll considered a summit meet-
ing even more important if the
foreign ministers show no prog-
ress.
Much comment in Western
Europe assailed Britain's ten-
dency to compromise and its pub-
licly assumed conciliatory at-
titude as weakening the West-
ern position. Reflecting
widespread uneasiness was the
charge by the influential in-
dependent Austrian Die Presse
that Britain might be heading
for another Munich. A French
Foreign Ministry official told
the American Embassy in Paris
that he understood that during
the conference interval, Lon-
don had been "working on" the
United States.
Bonn, while rejecting fur-
ther Western concessions on
Berlin, initiated the Western
proposal to create a four-power
commission with German advisers
to discuss unification, in-
creased contacts in Germany,
and the principles of a peace
treaty. After two and a half
years, the foreign ministers
would meet to discuss the com-
mission's work.
In the event of a continued
impasse at Geneva, however, Bonn
is also considering a unilateral
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declaration accepting all-Ger-
man negotiations provided East
Germany conforms to the terms
of articles 14 to 16 of the
Soviet draft peace treaty of
10 January, which call for
protection of human rights and
political freedom. The UN
might conduct an inquiry to
determine if these terms are
being fulfilled in both parts
of Germany. Any agreements
reached would be approved by
the four powers, with each
side retaining the right to
withdraw from negotiations if
terms on human rights were
violated.
If Moscow rejects all
Western proposals, Bonn favors
setting certain minimum condi-
tions for agreeing to a summit
meeting. Moscow would have to
agree that the foreign minis-
ters should recess to meet
again on the Berlin question
and-that the summit would only
discuss disarmament, unifica-
tion, European security, and
measures for`relaxing tension.
The West Berlin govern-
ment has submitted a memoran-
dum to the West German delega-
tion describing the Western
position as the maximum limits
Brandt and Berlin
strictions on propaganda activ-
ities.
A statement made by French
Foreign Minister Couve de
Murville at a dinner he gave
for Italian Foreign Minister
Pella on 12 July suggests a pos-
sible change in French official
attitudes toward a summit. He
said the West should search for
a minimum agreement with the
USSR which would warrant a sum-
mit and suggested an interim
solution on Berlin as the obvi-
ous arrangement to attain this
purpose. He opposed the West
German proposal that a summit
should return to discussion of
the German problem as a whole
and disarmament.
In the regular session on
15 Juily Couve backed the West-
ern proposal, but sharply at-
tacked linking an interim set-
tlement on Berlin with the over-
all German problem.
Heretofore, Couve has ap-
peared lukewarm toward a sum-
mit meeting, and De Gaulle has
been reluctant to proceed to
the summit without some prog-
ress. During his visit in Italy,
De Gaulle evidenced some im-
patience with the foreign minis-
ters' meeting and the problem
of whether to hold a summit
meeting, stating that after a
decision was made to hold one
or not, a "new phase" of inter--
national relations will have
opened which will require new
consultations on the part of the
West. (Con-
currect in by OS I
authorities have also warned
against accepting loose defi-
nitions of free access and re-
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THE CARIBBEAN AREA
Tension continues high in
the Caribbean area, and further
serious outbreaks are possible
before the impending special
conference of American foreign
ministers can act on the Carib-
bean crisis. The bloody unsuc-
cessful coup of 12 July in
Honduras and its aftermath
of continuing tension and spor-
adic violence are symptomatic
of the problems that trouble the
area, although the events in
Honduras are not directly re-
lated to the wider Caribbean
crisis.
The Cuban Government re-
mains determined to oust the
Trujillo dictatorship in the
Dominican Republic, and the
weak Haitian Government fears
Cuban-backed rebel landings in
Haiti designed to open a new
Cuban front against Trujillo.
Cuban exiles in the Dominican
United Stai
Republic and Florida, on the
other hand, say they intend to
launch an attack on the Castro
regime before the end of this
month.
The abortive 12 July coup
in Honduras, suppressed after
15 hours of fighting in the
capital in which an estimated
100 were killed, stemmed pri-
marily from deep-seated and
long-standing frictions between
the armed forces, which were
striving to maintain their con-
stitutionally endorsed autonomous
status in the government, and
a strongly antimilitary faction
of the governing Liberal party.
The Liberals, who came to power
in Honduras' first free election
in 1957, regard the military
as an unwarranted drain on the
treasury and an anachronistic
~ -ISLANDS
Venezuela
1" F British
Colombia g_"~O Brazil
SECRET
Belize
British Honduras
Cuba
Pn tadPncce
JAMAICA Haiti
Sri SAl9a.er. _._._ ? (Nicaragua
El Salvador- ,Managuap
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
leftover from the country's re-
cently ended dictatorial past.
President Ramon Villeda
Morales has
attempt to straddle e fence,
although his sympathies lie
with his Liberal party. Lead-
ing figures in his administra-
tion have constantly tried to
weaken the position of the armed
forces, and one even proposed
recently that they be abolished.
ormer army
cnier or staff, returned to Hon-
duras last month from exile ap-.
parently convinced that the
armed forces were ripe for re-
volt and that he could lead it.
After obtaining the backing of
elements of the police in the
capital and possibly also of
some dissident groups in the
army, he initiated action early
on 12 July. Top officers, most
of whom personally dislike Vel-
asquez, kept major army units
from defecting, and by late in
the day Velasquez had surren-
dered, on condition--immediately
accepted--that he be given asy-
lum in an embassy and promise
of safe conduct out of the
country.
As many as 1,500 civilians,
armed by Liberal leaders to help
defend the government, took a
leading part in the fighting on
12 July. Their subsequent ac-
tions made it clear they rep-
resent a threat to the author-
ity of the armed forces. The
military reacted energetically
the following day by ordering
all civilians off the streets
of the capital and by declaring
that the armed forces alone are
responsible for maintaining or-
der. Clashes between civilian
and military groups appear
likely, both in the capital and
in outlying areas where the
Liberals also control sizable
armed groups.
A factor which apparently
brought the civilian-military
feud to a head was the recent
dispersal by the Honduran Army
of two Cuban-supported rebel
groups intent on invading
Nicaragua, The army took the
action in the face of widespread
popular and Liberal party sympathy
in Honduras for the Nicaraguan
rebels. Although he denies it,
President Villeda is known to
have offered at least his moral
support to the Nicaraguan rebels.
Cuba - Dominican Republic
Landings on the north coast
of Haiti by several hundred in-
surgents from Cuba are expected
imminently by both the Haitian
and Dominican governments. The
Haitian ambassador in Cuba says
Cuba now has five military at-
tach4s and assistants in Haiti,
presumably to coordinate opposi-
tion tactics in the capital with
the lending forces. Any Cuban-
backed invasion of Haiti would
be primarily to open a new front
against Trujillo and would prob-
ably provoke Dominican military
intervention in Haiti.
The Haitian Army chief of
staff, who has privately stated
that Haiti is virtually defense-
less against any invasion, em-
phasized to the American ambas-
sador on 15 July that Haiti
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
looks to the United States for
help and wants no Dominican
military assistance.
Cuban Prime Minister Fidel
Castro is encountering increas-
ing unrest as public attention
is drawn to Communist penetra-
tion of his government. Cuban
exiles in the Dominican Republic
and in Florida claim to be in-
tent on launching a counter-
revolutionary effort in Cuba
before the end of this month.
Such ant attempt would probably
fail, however, as many Cubans
now becoming disillusioned with
Castro would patriotically rally
behind him. Stich an attack, which
probably would have Dominican
support, might also lead to Cuban
retaliation against the Domin-
ican Republic.
The case of Major Diaz
Lanz, former Cuban Air Force
chief who defected to the United
States on 29 June and publicly
charged Castro and other top
Cuban officials with being Com-
munists, has aroused Cuban lead-
ers to attack the United States
bitterly for treating this
"traitor" as a hero and thus
"intervening" in Cuban of
MIDDLE EAST HIGHLIGHTS
Iraq
Prime Minister Qasim has
made another major effort to
abate party strife in Iraq by
appointing four additional left-
ist civilians, three of them
closely associated with the Com-
munists, to his reorganized 16-
man cabinet and by announcing
that resumption of political
party activity will be permitted
before 6 January 1960. Qasim
also announced that sometime
next year the transitional rev-
olutionary regime is to come to
an end, a permanent constitution
adopted, in consultation with
the people, and an elected "na-
tional council" created.
Qasim probably hopes these
moves will at least reduce the
force of the long-standing Com-
munist pressure for resumption
of legal party activity and for
party representation in the cab-
inet. The Communists may well
remain dissatisfied with these
seeming concessions, however,
since the things they have
sought are freedom for party ac-
tion now--while they are still
very strong in relation to other
popular political organizations--
and a cabinet including outright
party representatives, not just
individuals who happen to be Com-
munists or near Communists.
The degree of influence
the new ministers will exercise
is far from clear. As a result
of the cabinet reshuffle, Ibrahim
Kubba, the outstanding pro-Com-
munist who, as minister of econ-
omy, was the primary architect
of the Soviet-Iraqi economic
agreements, has become minister
for agrarian reform and acting
minister for petroleum affairs.
Kubba for some time has
been cut out of negotiations be-
tween the government and the Iraq
Petroleum Company, however, and
he may hold the oil portfolio
in name only. Furthermore, the
agrarian reform program is full
of pitfalls, and Kubba could
turn out to be the "goat" for
its failure. The first woman
cabinet member, Dr. Nadia
Dulaymi, a gynecologist who
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959'
headed a Communist-front women's
rights organization, takes the.
Ministry for Municipalities, a
new creation whose actual powers
are poorly defined. At the same
time, Finance Minister Hadid,a
member of the National Democrat-
ic party (NDP), which has been
attacking the Communists, has
become acting minister of in-
dustry--a portfolio which ap-
parently will include most of
the functions of the former
powerful Iraq Development Board.
The most immediately im-
portant aspect of these moves
by Qasim is likely to be the im-
pression they create among
Iraqis generally as to which
group Qasim really favors. In-
dications so far are that these
impressions are being formed'
cautiously, probably because
the apparent contrast is too
striking between the anti-Com-
munist posture of the police
and security forces immediate-
ly before 14 July and what,
taken at f ace value, are ap-
pointments and announcements
favoring the Communists.
The idea that Qasim is
really trying to maintain an
equilibrium including the Com-
munists and other groups is prob-
ably a difficult and frustrat-
ing concept for the average
Iraqi political partisan to
grasp, especially because it
gives him no clear clue as to
which side the police are likely
to be on in any given situation.
In regard to the use of
police powers, Qasim made it
clear again this week that the
punishment of "traitors" and
the guarding of the republic
against "plotters" is the busi-
ness of government, not of self-
appointed groups', which may
'"unintentionally"' try to take
the law into their own hands.
Thus it does not seem likely
there will be any significant
relaxation of the stern securi-
ty measures such as those taken
last week against Communist
groups which demonstrated vio-
lently in several provincial
areas, or against the Communist
goon squads which have in the
past attacked their opponents in
Baghdad.'
Under these conditions the
Communists' rivals--especially
the NDP, which already has an
emb:ryonic peasant organization--
can try during the next six
months to build popular polit-
ical organizations to contest
more seriously the former Com-
munjst predominance "in the
street."
Radio Moscow's attacks on
the Shah and his policies con-
tinue without significant varia-
tion; however, on 10 July the
clandestine "National Voice of
Iran," located in the Soviet
Caucasus area, for the first
time referred to the develop-
ment of a "free officers or-
ganization" in Iran.
The American Embassy re-
gards the apparent weakening
of Iranian self-confidence in
the face of the continuing
Soviet propaganda attacks as the
most disturbing factor in the
present Iranian situation.
While any immediate radical
change in the Iranian position
is not anticipated, the initial
Iranian pride and self-esteem
at standing up to the Soviet
attacks appear to be giving
way to nervousness. A wide
range of embassy contacts in
Tehran reflect increasing con-
cern over the possible domestic
effect of the continuing sub-
versive propaganda, although
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1959
such concern will probably not
in itself lead to serious dis-
turbances in the near future.
Increasing pressure is being
exerted on the Shah to take a
more conciliatory line with the
USSR.
Iran intends to take the
issue of Soviet propaganda to
the United Nations, and it is
now investigating the best ap-
proach. The recently appointed
foreign minister, Jalal Abdoh,
is resigning for "reasons of
health," and he apparently will
return to New York to handle the
issue in the United Nations.
Sudan'
The public courts-martial
against Brigadiers Shannan and
Abdullah, leaders of the coup
attempt Of 22 May, have proved
to be something of a washout.
The trial proceedings are over,
but the announcements of ver-
dicts--and presumably of sen-
tences--are not expected until
the end of this week. Whatever
these may be, the Abboud govern-
ment has failed to present a
thoroughly convincing case of
anything but how tenuous its
control over the army officer
corps really has been. What was
to have been a demonstration of
the military government's strength
and resoluteness, what was to
have set an example to all army
personnel of swift, impartial
justice, has instead created a
climate for new dissidence.
Among the general populace,
as many are reported to be sym-
pathetic toward Shannan and
Abdullah as toward the govern-
ment's position. Grumblings
among junior officers in the re-
gional commands have persisted
in the wake of the arrest of most
of the leaders of the Shannan-
headed junior officers' move-
ment, and loyal troops of the
Khartoum garrison have remained
deployed to protect the capital
throughout the trial proceedings.
A week ago government security
officials arrested former Major
Abd al-Rahman Kibayda, an inept
and chronic plotter, who was
trying to line up dissident army
personnel in the Eastern Command.
Deputy Army Commander in -Chief .
Bashir Nasir, who:has had the
major voice in :army, assignments
-4or the pact; fe* months, might
decide to:try to:take control;
if:h.e feels the present regime
is tottering.
Ini:addition to his prob-
lems within the army, Prime
Minister Abboud is being sub-
jected to increasing pressure
from the head of the Ansar re-
ligious sect and from important
political leaders for a gradual
return :to. a7 'civilian govern-
ment<
In separate maneuvers,
friends of retired Major Gen-
eral Wahab, former interior
minister and an Ansar sect
and Umma party stalwart,
are urging officers of the
Khartoum garrison and of
the Southern Command to
support his return to the
government.
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CURRENT 'INTELLIGENCE WEEKLY SUIMMY
16 July 1959
PART II
NOTES AND COMMENTS
SOVIET MIDYEAR
The TASS summary of the.
report on the USSR's economic
performance during the first
six months of the Seven-Year
Plan indicates good progress
toward the plan's goals with
the possible exception of agri-
cultural output. Total indus-
trial production is reported to
be 12 percent over the corre-
sponding period of last year.
Growth rates reported for 1958
and 1957 were 10 percent, and
for 1956, 10.7 per-
cent. Six-month sta-
tistics in the past
have usually been a
good indication of
performance of the
full year. The Seven-
Year Plan calls for
an average annual in-
crease of 8.6 per-
cent. Official So-
viet production in-
dices are accepted
as statistically ac-
curate, but they are
not directly comps:.
rable to US statistics.
The plan was
fulfilled by all union
republics and econom-
ECONOMIC REPORT
The increase in labor productive.
ity in construction was 9 percent.
A reported increase of
1,800,000 workers since mid-
19543 indicates that necessary
additions to the labor force
are being found.
Inyedtment
The volume of capital in-
vestment increased 10 percent;
(Million Metric Tons
Unless Otherwise
'Specified)
Electric Power
(Billion KW
Production
First Half
1958
27
19. 3
21. 3
245
Production
First Half
1.959
29.3
21
23.1
252
61,7
Pere,
1958
ntIncrease
Over First
Gross Industrial
Output
Labor Productivdty
in Industry
?irst Halt
Hall 1957
Percentage Increase
First Half 1959
Over
First Half 1958
is areas (sovnarkhozy). Indus-
tries overfulfilling their plan
included pig iron, steel, rolled
metal, iron ore, nonferrous.met-
ale, machine tools, electricity,
coal, and oil.
The physical output data
included in the report indicate
rates of growth in general in
excess of those needed to
achieve Seven-Year-Plan goals.
The omission of data on cement
suggests that production of that
Item is probably behind schedule.
Industrial labor produc-
tivity reportedly increased 8
percent--compared with 6 percent
in 1958 and 6.5 percent in 1957.
the volume of building and
assembly work went up 15
percent, thus indicating
that the delivery of equip-
ment at the building sites
fell below plan. State
housing. made ready for oc-
cupancy in the first six
months of 1959 amounted
to About 330,000,000 square
feet of floor space, or
13 percent more than in
the corresponding period of
last year.
Agriculture
The total area sown to
winter and spring crops--484,-
000,000 acres--is approximately
CONFIDENTIAL
Annual Rate of
Percentage Increase
Needed to Achieve
Seven-Year Plan Goals
6.6-7.4%
7.4-8.5%
6.3-7.4%
2.7%
11.1%
11. 8%
PART 11 NOTES ANn (Inuuie Jiiia n.. -- ,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 July 1951)
the same as last year. The plan
for sowing spring crops was
overfulfilled.as a result of
an early, dry spring, but w, ath-
e.r .80 far suggests that av-
erage crops this year will be
considerably below last year's
record.
The area sown to corn was
increased by 6,670,000 acres
to a total 'of 55,400,000 acres.
This area, however, is still
less than the record'area of
59,100,000 acres in 1956. The
area.sown to sugar beets was
increased by almost 1,240,000
acres to t total of 7,400,000
acres, compared with 5,200,000
in 1957.
The half-year plan for the
purchase of meat was overful-
filled by 35 percent; milk and
wool, by 8 perce,