CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A003700060001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 40
• Document Creation Date: December 21, 2016
• Document Release Date: July 8, 2008
• Sequence Number: 1
• Publication Date: August 3, 1962
• Content Type: SUMMARY

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'111W SW
SECRET
11
C
URRENT
INTELLIGENCE
WEEKLY
SUMMARY
NAVY review
completed.
ARMY & DIA review(s)
completed.
COPY NO.- 73
OCI NO. 0428/62
3 August 1962
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
SECRET
GROUP I
Excluded from automatic dowrgrading
and declassification
State Dept. review
completed Approved For Release 2008/07/08: CIA-RDP79-00927AO03700060001-7
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W -AECK U,
CURRENT INTELLIGENCE WEEKLY SUMMARY
3 August 1,962
T H E W E E K I N B R I E F
(Information as of 1200 EDT 2 Aug)
BERLIN AND GERMANY . . . . , . . . . . . . . . . . . Page 1
There are increasing indications that Khrushchev has
concluded there is little chance of gaining a Berlin settle-
ment on terms favorable to the USSR unless Moscow increases
pressures against the West in Berlin. While the Communists
may be preparing to associate the East Germans more actively
with the administration of access controls, there are still
no indications that a firm time for signature Of a treaty has
been set.
NUCLEAR TESTING AND DISARMAMENT . . . . . . . . . Page 3
The USSR resumed nuclear tests at Semipalatinsk on 1
August. Testing in the Arctic will probably begin on or
shortly after 5 August, when a ban on shipping and aircraft
in the area goes into effect. At the 17-nation disarmament
conference, while Moscow has apparently been marking time in
anticipation of new Western proposals on test ban controls,
it has adopted a moderate approach in the talks in hopes of
und
t
ercu
ting the expected changes in Western positions
SOVIET NAVAL DEVELOPMENTS .
? . . . . . . . Page 4
The USSR has, in the last two weeks, given considerable
publicity to the growth of its naval strength, particularly
the development of new and sophisticated weapons. Khrushchev
and ranking Soviet officers witnessed naval exercises and a
variety of missile firings--including launchings from sub-
merged submarines--in the Northern Fleet area on 21 July. At
the Navy Day show in Leningrad a week later, there were no
major r,.velations; speeches and articles there and elsewhere
on that occasion, while boastful of new weapons capabilities,
generally stressed the defensive role of the navy,
CHINESE COMMUNIST MILITARY SITUATION . Page 6
. . . . . . . . . .
The Chinese Communist military build-up in June in the
area opposite Taiwan and the offshore islands apparently was
a precaution against possible Chinese Nationalist plans to
exploit unrest on the mainland. Evidence is accumulating
that the new units may be widely dispersed throughout the
Foochow Military Region rather than concentrated for attack
on Taiwan or the offshore islands.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
3 August .1962
. . . . . . . . . . . .Page 7
The 1962 harvest in the European satellites will prob-
ably be less than 1961's. Unfavorable weather is mainly re-
sponsible, but farm organizational problems created by col-
lectivization drives have caused a decline of grain acreage
in East Germany, Czechoslovakia, and Hungary. Restrictions
on purchases of butter, meat, and potatoes have been imposed
on consumers in East Germany, but formal rationing has not
yet been introduced in any of the satellites.
BULGARIAN MEASURES TO INCREASE AGRICULTURAL PRODUCTION . . . Page 8
In raising retail prices for some meat and dairy prod-
ucts on 30 July and increasing prices paid to farmers for
the same products, the regime apparently is trying among
other things to force the consumer to pay part of the cost
of these new incentives to step up farm productivity. Any
lasting improvement in the production of these products, how-
ever, will require a significant increase in agricultural in-
vestment and the adoption of measures to increase fodder sup-
plies. The retail price increases will be unpopular--partic-
ularly among urban consumers, who will feel the pinch most--
and will intensify dissatisfaction with the regime's economic
policies. 25X1
THE FOURTH PLENUM-OF THE YUGOSLAV CENTRAL COMMITTEE . . . . Page 9
The meeting of the Yugoslav party's central committee
in Belgrade on 22 and 23 July produced no startling policy
changes but did reaffirm the regime's basic program for eco-
nomic and political decentralization. The central committee
met to hear its leaders appraise the progress made in over-
coming the country's economic difficulties and to receive in-
struction from politburo member Aleksander Rankovic on re-
vitalization of the party. Tito, in an extemporaneous ha-
rangue concluding the plenum, made it clear he was not pleased
with most of the work of the meeting. As a result of his
remarks, a thorough re-evaluation of the program for de-
centralization will probably be undertaken with a view to
refining and extending
LAOS . .
? w < e r ? a
. . . . . Page 10
No real progress has yet been made 'toward administra-
tive and military integration of the three factions of the
month-old coalition government. Sporadic; military clashes
still occur, and Pathet Lao Propaganda. accuses Phoumi and
the US of attempting to sabota a the coallition and of con-
tinuing military activitie
s.
SOUTH VIETNAM
. . . Page 11
The first night helicopter operation by the South Viet-
namese resulted in significant victory for government forces,
but small-scale Communist attacks continue unabated. There
is some indication that the Viet Cong are in the process of
forming regimental units. Recent political arrests indicate
Diem's concern over potential..coup plotters and neutralist
elements. 25X1
SECRET
EAST EUROPEAN CROP OUTLOOK FOR 1962
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3 August :1962
WEST NEW GUINEA . . . . . . . . . . . . . . . . . . . . . Page 12
Indonesian and Dutch negotiators reached a preliminary
understanding on West New Guinea on :31 July, and U Thant
has prepared a complementary "letter of understanding" on
transfer modalities. The home governments will probably
soon approve the arrangement, thus reducing the likelihood
of a large-scale attack on the island by the Indonesians.
They may, however, find some pretext to continue small-
scale infiltrations. 25X1
SYRIA . . . . . . . . . . . . . . . . . . . . . . . . . . Page 13
Nasir's declaration that the Syrian and other "reaction-
ary" regimes must be overthrown has spurred the Syrians to
call for an emergency session of the Arab League Council
to charge the UAR with subversion. Cairo is stepping up
its pressures against Syria in an effort to reverse the de-
cline in pro-UAR sentiment and to reduce the effectiveness
of current measures by the Syrian regime to crack down on
nro-Nasir agitators and on Nasir sympathizers in the army.
Meanwhile, the regime is showing enough confidence in its
position to relax its curbs on political activity--a move
which is likely to stimulate political infighting. 25X1
CONGO . . . . . . . . . . . . . . . . . . . . . . . . Page 14
Adoula's announced intention to produce a new federal
constitution for the Congo has been favorably received by
Tshombe, but it is unlikely that when the two leaders
get down to specifics their differences will be easily re-
solved. Tshombe remains confident of his position and con-
tinues to support maneuvers by anti-Adoula politicians
in Leopoldville. U Thant and his Congo Advisory Committee
are opposed to the use of force against Tshombe, but believe
that present UN mandates give the secretary general suf-
ficient authority to use economic pressure. Brussels, Lon-
don, and Paris strongly oppose using military force, and
are cool toward the use of ec pressures to end Katanga's
separatism. 25X1
ALGERIA . . . . . . . . . . . .
. . . . . . . . . Page 16
The "full agreement" between Algerian political leaders
announced on 2 August appears to be a temporary solution
prompted by the realization that the prolonged dispute had
aroused public indignation. The compromise acceptslas the
country's interim government the seven-man political bureau
formed by Ben Bella on 22 July, but powerful Vice Premiers
Belkacem Krim and Mohamed Boudiaf will probably continue to
oppose Ben Bella's efforts to gain control of the country.
Political maneuvering will continue to hamper the restoration
of effective government. Officers of the Algerian National
Army, now conscious of their power as arbiters, may resist
establishment of a civilian government which would reduce
their personal power.
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3 August 1962
FRANCE-TUNISIA . . . . . . . . . . . . . . . . . . . . . . Page 18
The July consultations between French President de
Gaulle and Tunisian Defense Secretary Ladgham resulted in
the renewal of diplomatic relations between the two countries
and apparently convinced Tunisia that France would evacuate
the Bizerte base in the near future. The consultations and
resultant agreements were influenced by the Algerian situation.
Tunisian President Bourguiba wants to :regularize relations
with France in order to strengthen his hand in dealing with
Algeria, while De Gaulle is reluctant to set a precie date
for evacuation so soon after granting Algerian independence
and prior to the formation of an Algerian government
EUROPEAN POLITICAL UNION DEVELOPMENTS . . . . . . . Page 19
Belgium's Spaak has been pushing a, new proposal in re-
cent weeks intended to resolve the differences regarding
European political union which led to the breakoff of
negotiations last April. He views his idea for a "politi-
cal c6mmiss16n" as a middle way between the federalist ap-
proach to union and the antifederal bias of De Gaulle.
~ The prone ura pro m
how to include Britain remains in any"case an obstacle to
any new round of negotiations.
INCREASING PORTUGUESE PROBLEMS WITH OVERSEAS TERRITORIES . Page 20
Frictions are increasing within the Salazar regime
over policy toward Portugal's overseas territories.
Premier Salazar is reported to have intervened person-
ally to annul recent moves taken under the authority of
Overseas Minister Moreira to institute various reforms
within the territories. This produced a near crisis in
Angola, and there are increasing signs of unrest in
Portuguese Guinea and dissatisfaction in Mozambique. If
Salazar continues to block Moreira's reform program,
unrest will increase in the territories. This in turn
will increase opposition to Salazar in Portugal.
PERU . . . . . . . . . . . . .
Page 21
The military junta which seized power on 18 July seems
firmly established and in control of the domestic situation.
It has received pledges of support from all influential
groups except APRA, which has decided to confine its opposi-
tion activities to "political" criticism. The release of
President Prado on 29 July has eliminated a major cause of
international criticism, and many free-world countries prob-
abl will resume di lomatic relations within a week.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
3 August 1962
PROSPECTS FOR THE NEW ADMINISTRATION IN COLOMBIA . . . , , Page 22
President-elect Valencia of Colombia assumes office
on 7 August, succeeding Lleras Camargo for a four-year term.
Continued stability in the country will depend largely on
how successfully Valencia maintains unity within the
National Front coalition which has governed Colombia since
1958. Among the serious problems facing the new adminis-
tration are the increase in rural violence, decreasing
world coffee prices and a growing balance-of-payments
deficit.
CUBA'S 26 JULY CELEBRATIONS . .
. Page 23
Domestic and foreign observances in connection with
the ninth anniversary of the Castro revolution were gen-
erally quiet and contained no surprises. Fidel Castro's 26
July speech in Santiago de Cuba, aside from hints that the
domestic rationing system would be extended to include
clothing and other consumer goods, consisted mainly of
reiterations of standard propaganda themes. Observances
elsewhere in Latin America were generally unspectacular.
Most bloc nations sent congratulatory messages to Cuban
leaders, and in Moscow presidium.member Frol Kozlov stated
during a Cuban Embassy reception that past Soviet "guarantees
of military aid" to Cuba in the event of foreign interven-
SPECIAL ARTICLES
KHRUSHCHEV TIGHTENS CONTROLS OVER SOVIET FARMS. Page 1
Khrushchev has greatly strengthened party control over
the countryside and further centralized agricultural
management in an effort to increase output dramatically
without diverting resources from industry and the military
establishment. Little result is likely, however, until he
abandons bureaucratic reshuffling of the same old person-
nel and begins to provide more machiner and fertilizer and
greater incentives for the farmers.
STRATEGIC HAMLETS AND COUNTERINSURGENCY IN SOUTH VIETNAM. Page 6
Since last January the South Vietnamese have been push-
ing on a crash basis the creation of strategic hamlets--
small fortified communities with some self-defense capability--
as a major element in their campaign against the Viet Cong
insurgents. The program is designed to help isolate Viet
Cong troops from the peasantry, to expand the government's
control over the countryside, and to release more regular
troops from static defense for offensive actions. Some 2,400
strategic hamlets have already been created, and by the end
of 1962 Saigon hopes to bring into the program nearly half
of the country's 16,000 hamlets. The hamlets are organized
locally with local resources, and vary widely in effective-
ness. They have not been integrated into regional and pro-
vincial military planning, and like some other similar projects
many suffer from lack of peasant support.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
WEEKLY REVIEW
BERLIN AND GERMANY
There are increasing indi-
cations that Khrushchev has con-
cluded there is little chance of
gaining a Berlin settlement on
terms favorable to the USSR un-
less Moscow greatly increases
pressures against the West in
Berlin. Soviet leaders prob-
ably consider this course the
best means to probe for West-
ern reaction-to various en-
croachments on the West's in-
terests and may even hope in
this manner to establish prece-
dents for a number of restric-
tions they would like to see
written into a peace treaty
with East Germany.
In the wake of the Rusk-
Gromyko talks, Izvestia on
28 July published an authori-
tative article which under-
scored Moscow's unyielding at-
titude on Berlin. The article
reflected the USSR's growing
conviction that the present
form of negotiations with the
West affords little prospect
for meeting Communist demands,
but nevertheless was careful
not to close the door com-
pletely to further diplomatic
contacts. Izvestia attempted
to convey, however, that such
talks must be concerned with
a resolution of the Berlin
problem on Moscow's terms.
The article criticized re-
cent Western press commentary
which questioned the useful-
ness of further talks and as-
serted that "it is not too
late" for the US to become
"sensible" on the issue of West-
ern forces in Berlin before
the conclusion of a peace treaty
with East Germany. It bluntly
reaffirmed Gromyko's firm po-
sition in Geneva that the USSR
intended to sign the peace
treaty and declared that it
would not be "an act of for-
mality," pointing out that the
West would then have to deal
with East Germany. The ar-
ticle lashed out at Western
press reports which have spec-
ulated that the USSR could be
"mollified at the last moment,"
emphasizing that "nothing could
be more foolish and dangerous."
Although the US Embassy in
Warsaw has reported rumors of
a bloc conference on Germany
to be held sometime this sum-
mer in Prague, there are no
indications that Moscow has
established a firm time for
signing a peace treaty. Before
proceeding, Soviet leaders will
undoubtedly continue to weigh
carefully the Western response
to specific courses of action.
Nevertheless, the British am-
bassador in Moscow and Ambassa-
dor 'Thompson have both con-
cluded that Khrushchev plans
to sign a separate treaty if
there is no movement on Berlin
by the end of August.
The official announcement
on 1 August that East German
party leader Ulbricht and Acting
Premier Willi Stoph are flying
to the USSR, presumably to meet
with Khrushchev, also appears
intended to increase appre-
hension in the West concerning
the Berlin situation. The East
Germans will probably be briefed
on Moscow's assessment of the
Rusk-Gromyko talks by Khrushchev,
who is en route to Sochi for
a month's vacation, and may re-
view with him the character
and timing of the bloc's next
moves on Berlin.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
There are indications that
preparations are being made by
the Communists which may be in-
tended to associate the East
Germans more actively with the
administration of access con-
trols either before or after
signature of a treaty. The US
mission in Berlin has received
a number of reports that the
East Germans are streamlining
their control procedures over
non-Allied passenger traffic
on the ground access routes in-
to West Berlin. Assigning the
East German Ministry of State
Security a greater measure of
authority over those procedures
would be designed to provide
tighter control in the event
the East Germans assume wider
responsibilities from the USSR.
Since mid-May East German
authorities have been fortify-
ing and deepening defenses
along the Berlin Wall. The US
mission points out that while
these fortifications reduce
the possibility of incidents,
they may also be aimed at pre-
venting a breakout by the East
German population in the event
of a crisis. The Soviets and
East Germans appear in addition
to be strengthening their po-
sitions along the entire 850-
mile zonal border with West
Germany.
The Berlin mission has a
reliable report that all homes
for the aged, nurseries, and
hospitals located in a 5-
kilometer security zone adja-
cent to the border are to be
evacuated by 31 August. The
ostensible reason given for
the move was that a "concentra-
tion of manpower" was expected
after 1 September.
The mission speculates
that, if the Soviet Union is
preparing gradually to extend
East German sovereignty over
the land access routes into
West Berlin, a likely period
for this would be just before
or, during the fall military
maneuvers in September and
October.
In its efforts to probe the
Western powers for possible con-
cessions while it deliberately
increases tensions in Berlin,
the USSR has sharpened its cam-
paign to erode certain aspects
of the four-power responsibil-
ity for Berlin. General Yaku-
bovsky, commander of Soviet
forces in East Germany, on 25
July sent almost identical
notes to his US and UK counter-
parts in West Germany protest-
ing; the alleged violation by
Western aircraft of established
air corridor procedures.
Yakubovsky's action marks
the first time in the past few
years that the Berlin commandants
have been bypassed on an issue
which belongs strictly within
their jurisdiction. Yakubovsky
functions as the senior Warsaw
Pact commander in the Soviet
zone and, in attempting to as-
sume responsibility for actions
within Berlin, is laying the
groundwork for a Soviet con-
tention that the Warsaw Pact
states, including East Germany
and the NATO powers, including
West Germany, should together
resolve any problems affecting
West Berlin. The Soviets would
view any concession from the 25X1
West on this question as under-
mining the quad
ri artite status
of 'Nest Berlin.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
NUCLEAR TESTING AND DISARMAMENT
The USSR resumed nuclear
testing at Semipalatinsk on 1
August. Testing in the Arctic
will probably begin on or shortly
after 5 August, the day a ban
on shipping and aircraft in the
area goes into effect.
At the 17-nation disarma-
ment conference, the Soviet
Union is apparently marking
time until it has had an oppor-
tunity to assess the anticipat-
ed new Western proposals which
most neutrals feel will offer
a reduction in the West's demands
for international verification
of suspicious seismic events.
To undercut the expected changes
in Western positions, Moscow is
adopting a moderate approach and
attempting to appear serious in
discussing the military and
strategic factors which are at
the heart of a disarmament
agreement.
The neutrals have commented
that Soviet delegate Zorin's
latest approach, which included
intimations that the USSR would
be willing to extend its time
limit of 15 months for the im-
plementation of the first stage
of a disarmament treaty, has
made an impact. On 27 July,
Zorin moved into a discussion of
the reduction of military forces
under the first stage of the
proposed Soviet draft disar-
mament agreement. Zorin at-
tempted to demonstrate that
after the first stage is put
into effect only reduced land
armies would remain, resulting
in a balance of forces between
NATO and Warsaw Pact powers.
However, the Soviet delegate
reiterated Moscow's demand for
the elimination of all foreign
bases in Stage I and left
unresolved the massive verifi-
cation problems posed by the
USSR's plan.
The Soviet Union may be
seeking to obtain neutralist
approval for recessing the
disarmament talks in order to
move them into the more advan-
tageous propaganda forum pro-
vided by the United Nations.
According to the Italian dele-
gate, Soviet Foreign Minister
Gromyko indicated in Geneva
that since all nations should
have a chance to discuss dis-
armament at the UN, the talks
should go into recess when
the 17th General Assembly
session convenes in September.
One Soviet representative in
Geneva expects the next recess
to begin on 1 September.
Gromyko and other Soviets
have been vague on a firm date
for the resumption of the Geneva
talks but probably hope for a
lengthy recess in order to make
use of the UN platform for attack-
ing US positions and for seeking
endorsement of general resolu-
tions supporting Soviet views
on partial disarmament measures.
However, in order to appear
responsive to the neutralist
hope for a short recess, Soviet
representatives in Geneva have
recently hinted at early Novem-
ber as a target date for re-
the disarmament talks
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SOVIET NAVAL
The growth of Soviet naval
strength, particularly the
development of new and sophis-
ticated naval weapons, was
given considerable prominence
in the publicity connected
with Soviet Navy Day on 29
July and with the exercises
and missile firings on 21 July
in the Northern Fleet, which
were witnessed by Khrushchev.
Soviet announcements of these
activities stressed air, sur-
face, and particularly subma-
rine missiles as well as the
capability of Soviet submarines
to operate anywhere in the
oceans and under polar ice.
Despite such boasts, So-
viet pronouncements generally
stressed the defensive role
of the navy. Defense Minister
Malinovsky, in his 29 July
Order of the Day, declared,
DEVELOPMENTS
"The Soviet state is using its
constantly growing strength to
secure a lasting peace on earth
and prevent a new world war."
Admiral Zozulya, chief of staff
of the Soviet Navy, stated,
"T.he Communist Party of the
Soviet Union, the Soviet Gov-
ernment, and the Soviet people
are doing their utmost to make
the Soviet armed forces strong
and equip them with all modern
means of defending the country."
Northern Fleet Exercises
The naval display was ob-
served by Khrushchev from the
deck of the Sverdlov cruiser
Ushakov. His party included
Defense Minister Malinovsky,
Navy Commander in Chief Admiral;
Gorshkov, and Army General
Yepishev, chief of the Main
Political Directorate.
Khruschev and Malinovsky watched Northern Fleet exercises from the
Sverdlov cruiser Ushakov, similar to the one shown here.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Soviet press releases in-
dicated that missiles were
launched from submerged and ap-
parently nuclear-powered sub-
marines and included a missile
launching by a surface unit--
possibly the new heavily armed
Kynda-class destroyer.
On the day of Khrushchev's
visit, three submarine officers
were awarded the title of Hero
of the Soviet Union for carry-
ing out "a special government
mission," and a number of en-
listed men were also decorated.
The correspondent also
wrote that he had observed the
loading on a submarine of a
"huge ballistic rocket designed
to destroy larger areas thousands
of kilometers away."
This small (medium range) Q-Class submarine 329
displayed at Leningrad on Navy Day was described
by some Western observers as resembling US nuclear-
powered submarines. The Q's are diesel propel25X1
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Navy Day
Reports available to date in-
dicate that the hardware displays
on Navy Day were relatively insig-
nificant, particularly when com-
pared with last year's. In Lenin-
grad, where a naval parade up the
Neva River is customarily held, only
15 combat ships were exhibited, in-
cluding a Q-class medium submarine,
three other conventional submarines
(probably W-class units), a Kirov-
class cruiser, and ten destroyers
and minesweepers. All were said to
be conventionally armed and propelled,
and one observer stated that the most
interesting ship on the Neva was the
old museum piece, the cruiser Aurora.
TASS reported other naval pa-
rades in Sevastopol, Murmansk,
Vladivostok, and in the Amur Bay.
Except for the Northern Fleet pa-
rade at Murmansk, only one rocket-
armed ship was mentioned--at Sevas-
topol.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
CHINESE COMMUNIST MILITARY SITUATION
The Chinese Communist mili-
tary build-up in June in the area
opposite Taiwan and the off-
shore Islands apparently was
a precaution against possible
Chinese Nationalist plans to
exploit unrest on the main-
land. No additional Communist
ground force units appear to
have moved into the Foochow
Military Region during the
past month, and there has been
no evidence of preparations
for an imminent assault against
the offshore islands.
Chinese Communist propaganda
on the Taiwan Strait situation
has receded considerably during
the past two weeks; references
to it continue to focus on al-
leged Nationalist plans for an
attack on the mainland, and on
the Communist ability to repel
any assault. Reports that ci-
vilian evacuation from some
points along the Fukien coast
has been postponed suggest that
the urgency of Peiping's concern
over an attack has diminished.
In an informal
new con erence on 23 July, how-
ever, Chen chose to keep the West
guessing on Peiping's current
intentions in the Taiwan Strait
by asserting that the military
buildup could be termed neither
"defensive nor aggressive." He
did indicatefthat Peiping regarded
the presence of United States
armed forces in the Taiwan Strait
area as the principal bar to a
Communist "liberation" attempt,
and implied that because of the
present military balance, Com-
munist China continues to take
a long-range view of the Taiwan
problem. According to Chen, 25X1
Communist China can wait "ten
or twenty years if necessary"
to achieve its goal.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The 1962 harvest in the
European satellites will prob-
ably be less than 1961's. Un-
favorable weather is mainly
responsible, but farm organiza-
tional problems created by
collectivization drives have
caused a decline of grain acre-
age in East Germany, Czecho-
slovakia, and Hungary.
Droughts and unusually
cold weather throughout the
satellites during the fall of
1961 and spring of 1962 ad-
versely affected the small
grain crops--rye, barley,
wheat, and oats. Bulgaria,
Czechoslovakia, Hungary, and
Poland have already indicated
that their small grain harvests
for 1962 will not equal last
year's crops, and Rumania's
may be 5 to 10 percent less
than in 1961. Albania, how-
ever, has implied that its
small grain harvest should be
at least as good as the favor-
able one in 1961. East Ger-
many's grain crop probably
will be better than last year's
very poor harvest, but import
requirements in 1962 will con-
tinue to be heavy.
Fall-sown grains in
Hungary and Czechoslovakia
were affected adversely by
the prolonged fall drought in
1961 and by December's freezing
temperatures. Recurrent freez-
ing and thawing also damaged
grains sown last fall in East
Germany. Prospects for spring-
grown grains also were re-
duced by late planting--spring
was about three weeks late in
all countries except Albania
--followed by an unusually
dry and cool period for Hungary,
Bulgaria, and Rumania. Drought
conditions were reported in
Rumania and Bulgraia.
A late freeze in May de-
stroyed considerable areas of
early-sown vegetable crops in
East Germany, Hungary, and
Poland, while planting of pota-
toes,: sugar beets, and corn was
delayed in the northern satel-
lites. The Hungarian, East
German, Czechoslovak, and
Bulgarian regimes have urged
collective farmers to sow
larger areas to late summer
fodder and vegetables to compen-
sate for the failure to meet
planned goals of spring-sown crops.
Production of East Europe's
major, fodder crops--corn, pota-
toes, fodder beets--will depend
on weather conditions in July
and August. Because moisture
reserves are already low, above-
normal amounts of rainfall are
needed in August to prevent
serious shortfalls in Hungary,
Rumania, and Bulgaria, the major
corn producers.
The output of livestock prod-
ucts during the first half of
1962 has been adversely affected
by low stocks of fodder in
Czechoslovakia, Hungary, and East
Germany. Meat, eggs, and milk
production have not shown the
normal seasonal upturn in these
countries, and it is doubtful
that these production losses
can be recovered during the
latter half of 1962.
Scarcities of food have not
resulted in introduction of for-
mal rationing in any of the
satellites. There are restric-
tions;, however, on consumer pur-
chases of butter, meat, and po-
tatoes in East Germany. A tight-
er food supply situation may de-
velop in Czechoslovakia before
the end of the year. The impact
of fodder shortages on livestock
products in Poland, Hungary,
Rumania, and Bulgaria could force
cutbacks in the exports and do-
mestic supplies of these coun-
tries.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
BULGARIAN MEASURES TO INCREASE AGRICULTURAL PRODUCTION
In raising retail prices
for certain products on 30 July
and increasing prices paid to
farmers for the same products,
the Bulgarian Government appar-
ently is attempting among other
things to force the consumer to
pay part of the cost of these
new incentives to step up farm
productivity. Any lasting im-
provement in the production of
these products, however, will
require a significant increase
in agricultural investment and
the adoption of measures to in-
crease fodder supplies.
The retail food price in-
creases are mainly for meat and
dairy products. The price of
poultry increased 27.2 percent,
other meats 23.7, meat products
25.4,dairy products 31.8, and
eggs 11.5 percent. Prices of
other basic foods were not
changed. The regime hopes that
the price rises will force many
consumers to buy less meat and
dairy products in favor of other
more plentiful foods.
In addition to establish-
ing higher prices to be paid
to farmers for certain products
the state has lowered prices
for construction materials, fer
tilizers, petroleum products,
and other supplies used by col-
lectives in order to decrease
their production costs. Effec-
tive 1 January 1963, collective
farmers will be paid a guaran-
teed minimum wage, and taxes
on collective farm incomes are
to be reduced. These incentive
measures are designed to stim-
ulate production.
The regime has also taken
steps to change the distribu-
tion pattern of worker and pen-
sioner income in 1963. It claims
these steps will reduce the im-
pact of the price rises on lower-
income groups to put the burden
on those with higher wages and
pensions. Income taxes for
lower income groups are to be
reduced and family allowances
increased. Pensions of low-
income groups are to be raised
next January. A reduction is
to be made in higher salaries
and pensions to help defray
the cost of the incentive program.
Sofia had previously in-
troduced measures to increase
agricultural incentives. Early
in 1961 purchase prices for
some food products were raised,
and pension and social security
programs for collective farms
broadened. The government,
however, now admits that past
measures did not increase
incentives sufficiently or
provide the agricultural sector
means for expansion.
In an appeal accompanying
the latest announcement, the
Council of Ministers denied that
food production has decreased
and attributed food shortages
to increased purchasing power
of the population. The appeal
exhorted farmers to increase
productivity, and stated that
present increases in retail
prices of some foods are only
temporary.
Price increases are bound
to be unpopular, particularly
among city inhabitants who will
feel the pinch most, and will
intensify current dissatisfaction
with the regime's economic
policies. Moreover, urban dwellers
are likely to resent a raising
of farm incomes at their ex-
pense. The average Bulgarian
urban family spends over 40 per-
cent of its income on food and
approximately one quarter of its
food budget on items now subject
to price increases. Since the
beginning of the year the cost
of living has risen. Because
the regime's measures to soften
the effect of price increases
on low-income groups will not 25X1
be effective until 1963, the
price rises will reduce real in-
comes in the short run.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The meeting of the Yugoslav
party's central committee in Bel-
grade on 22 and 23 July produced
no startling policy changes but
did reaffirm the regime's basic
program for economic and political
decentralization. The central com-
mittee met to hear its leaders ap-
praise the progress made in over-
coming the country's economic dif-
ficulties and to receive instruction
from politburo member Aleksander
Rankovic, Tito's heir apparent in
the party, on revitalization of
the party; the government has al-
ready been reorganized. Tito, in
an extemporaneous harangue con-
cluding the plenum, made it clear
he was not pleased with most of
the work of the meeting. As a re-
sult of his remarks a thorough re-
evaluation of the program for de-
centralization will probably be
undertaken with a view to refining
and extending it.
Last year's efforts toward eco-
nomic liberalization and reform
were hampered in part by the loss
of elan, efficiency, and unity in
the Yugoslav League of Communists.
There were frequent references by
plenum speakers to corruption,
republican nationalism, and com-
placency on the part of party
members and organizations.
To deal with these weaknesses,
Rankovic ordered a thorough shake-
up of the party. All phases of
party operations are to be studied
with an eye to reorganization. Party
leaders are to relinquish their
governmental and other posts so
that they may be free to perform
their party tasks more effectively.
Rotation of party posts is to be-
gin, and the way is to be cleared
for the rise of postwar party mem-
bers into the leadership. Inactive
and incompetent party members are
to be weeded out.
None of the economic reports
to the plenum questioned the basic
soundness of the regime's program
for economic liberalization and re-
form. Instead they proposed gen-
erally sound steps to meet the most
pressing economic problems. Self-
sufficiency in wheat,for example,
is to be achieved by increasing
acreage devoted to its cultivation
and the incentives to farmers to
grow it. Investments in industry
will be made where they will
yield the fastest return. The
overambitious Five-Year Plan
(1961-65) will be scrapped, and
a new, "realistic" Seven-Year
Plan (1964-70) will be prepared.
The plenum was also given a pre-
view of the targets of the 1963
plan which, although less ambitious
than those of 1962, are consider-
ably higher than the accomplish-
ments of the past 18 months.
Tito's displeasure apparently
stemmed from the failure of central
committee members to comment at the
plenum on the basic issues in-
volved in Yugoslavia's current
problems. He claimed there was
opposition within the party to
his policies, and delivered a
strong defense of decentralization,
workers' councils, and the role of
the party in guiding rather than
managing Yugoslav society. His
specific suggestions to the plenum
appear to portend further de-
centralization of Yugoslavia's
economic operations. He put for-
ward for later consideration,
for example, the possibility of
making the industrial enterprise
the basic unit of society rather
than the opstina--Yugoslavia's
smallest territorial-economic
unit. The enterprises, through
their workers' councils, are al-
ready theoretically self-govern-
ing units. In line with Tito's
most recent proposal, they would
have their administrative and
financial powers broadened and be
urged to carry on foreign trade
directly without export-import
middlemen.
Although the time appeared
r:Lpe for a report on Yugoslav-bloc
relations, none was made public.
Primary mention of the bloc came
in a denial--in rebuttal to certain
charges from "abroad"--that Yugo-
s:Lav policy changes were in any way
connected with Belgrade's improved
relations with Moscow. Although
Tito urged that Yugoslav enter-
prises increase their cooperation
with bloc firms, he stated that
Yugoslavia's trading future lies
with the underdeveloped states.
To this end, Belgrade will continue
and perhaps increase its credits
to these states for the purchase
of Yugoslav capital equipment.
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CURRENT INTELLIGENCE WEEKLY SUMMARY ,
The month-old coalition
government continues to exist
essentially in name only. No
real progress has yet been made
toward administrative and military
integration of the three fac-
tions. Meetings of mixed com-
mittees established to perfect
the cease-fire and to arrange
for national unity have been
given over largely to the filing
of rectiminations and complaints
by the various representatives.
Premier Souvanna Phouma's return
to Laos early this month, how-
Khou
Muon
K#y'?
-/i Ban Hin
Heup
pSam Neua
1
?l SAM NEUA
K hang g 0 c Ban
Ban tJ-
uong [a ~A
>S~qui is_~f PRABA,
Pak
Beng Muonf, Houn'
Huang
Prabang
r
Sayabour Phou
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CURRENT INTELLIGENCE WEEKLY SUMMARY
sabotage the coalition and of
continuing "provocative" mili-
tary activities. These ac-
cusations charge designs to
create an anti-Communist buffer
zone in southern Laos, an area
in which the Pathet Lao and
supporting North Vietnamese
military elements appear them-
selves intent on consolidating
control over strategic trails
near the South Vietnamese and
Cambodian border.
The Geneva accords signed
on 23 July stipulate that all
foreign forces must be withdrawn
from Laos by 6 October, but
monitoring of the movements of
the approximately 10,000 North
Vietnamese troops there will be
extremely difficult. In addition
to the inherent problems of
rugged terrain and poor com-
munications, the Pathet Lao are
expected to attempt to prevent
effective surveillance within
their controlled territory by
the International Control Com-
mission.
In their first night heli-
copter operation, South Viet-
namese security forces conducted
a highly successful search and
clearing mission in Kien Tuong
province southwest of Saigon on
20-21 July. Viet Cong losses
reportedly included 131 killed
and 48 captured, while govern-
ment forces suffered only 13
casualties. Saigon has played
up the action with victory
parades to bolster public con-
fidence.
The Viet Cong nevertheless
continue their widely scattered
small-scale attacks. Rail sabo-
tage or train ambushes are the
most significant actions. In
several instances government air-
craft have recently encountered
tracer ammunition during close
support operations, indicating
that the Viet Cong are making
better use of their weapons.
The Viet Cong may be making
progress toward the formation of
regiments in developing their
military organization. In May
1962, reported the 25X1
existence or w a may be a cadre
for regiments in the northern
part of the country. Regiments
are not yet accepted in the Viet
Cong order of battle and any
regimental-level staffs now in
existence are probably coordinat-
ing the independent operations
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CURRENT INTELLIGENCE WEEKLY SUMMARY
of several international bat-
talions within a given ter-
ritorial command.
Local criticism of Diem has
increased as a result of some
30 political arrests in the
past few weeks. The arrests
are ostensibly made for the
purpose of questioning opposi-
tion elements before the forth-
coming trials of participants
in the abortive coup of No-
vember 1960. They also re-
flect an effort by the gov-
ernment to round up neutralists
and potential coup plotters.
There have been no recent re-
ports indicating serious ef-
forts to plan the government's
overthrow, but Saigon is ap-
parently concerned that neu-
tralist sentiment is growing
in educated circles.
WEST NEW GUINEA
Indonesian and Dutch nego-
tiations reached a preliminary
understanding on West New Guinea
on 31 July, and UN Acting Secre-
tary General Thant has prepared
a complementary "letter of un-
derstanding" on transfer modal-
ities. The respective home gov-
ernments have not approved the
arrangement, but early consent
is likely. Sukarno probably
will abandon his demand for turn-
over of West New Guinea's admin-
istration to Indonesia by the
end of 1962, since Thant has
agreed that the Indonesian flag
will be flown beside the UN flag
beginning 1 January 1963.
According to the 25-point
understanding, top Dutch of-
ficials in. West New Guinea will
be replaced as soon as possible
by a UN administration employ-
ing non-Dutch, non-Indonesian
officials in the higher echelons
and a maximum number of native
Papuans. Indonesians may be
used at lower levels. After
1 May 1963, the UN administrator
may,, at his discretion, transfer
all or part of the administration
to Indonesia. Procedures to
permit self-determination of
the Papuans must be completed
no later than l969.
Indonesia's Foreign Minister
Subandrio expects to return to
New York on 12 August for a
few days of formal negotiations
and for the signing of the
agreement on 15 August. Other
members of the Indonesian dele-
gation have remained in Washington
for continued technical dis-
cuss:tons.
The near-resolution of
the dispute reduces the like-
lihood of any large-scale
attack on West New Guinea by
the Indonesians, but they may
find some pretext to continue
small-scale infiltrations.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Nasir's public declaration
on 26 July that the Syrian and
other "reactionary" regimes must
be overthrown has spurred the
Syrians to call for an emergen-
cy meeting of the Arab League
Council to levy charges of Egyp-
Nasir's invigorated drive
against the Qudsi-Azmah govern-
ment appears to stem in part
from the decline in pro-Nasir
sentiment in Syria. Pro-Nasir
elements there are being vigor-
ously suppressed. The roundup
of pro-Nasir agitators has in-
cluded a number of hitherto
"untouchables"--several polit-
ical leaders and some of the
country's more prominent labor
leaders who recently organized
political strikes and demonstra-
tions.
While the
majority o t e ower class re-
mains devoted to Nasir, it is
disorganized and leaderless.
Manifesting increasing
assurance, the regime has re-
laxed censorship, diminished
the civil powers of the military,
and decreed a new law which will
permit political party activities,
the first since Nasir banned
them in the spring of 1958.
Accompanying the government's
growing self-confidence has been
an increase in domestic political
rivalries. Conservative poli-
ticians are registering their
impatience with the wielding of
power by an unconstitutional
cabinet backed by the military.
They are agitating for the return
of the parliament ousted in the
March coup. The socialistic
Baath party remains split into
a faction led by the violently
anti-Nasir Akram al-Hawrani and
one led by Michel Aflaq and
Sa7Lah al-Din Bitar which, while
somewhat disillusioned with
Nasir, still is dedicated to
the concept of Syro-Egyptian
unity.
In contrast, former Prime
Minister Khalid al-Azm, one of
Syria's most astute politicians,
feels that increased political
freedom should be postponed to
a later date in the face of
Nasir's new offensive. He is
pushing for the formation of a
"national front" consisting of
the bulk of the old-line Popu-
list and Nationalist parties,
plus certain independents. This
grouping, prestunably led by Azm,
would oppose Hawrani's Baathist
faction and other lesser groups.
Azm's design may well founder on
the old Populist-Nationalist
rivalry, and by excluding Hawrani
leaves out one of the most
vocal and effective anti-Nasir
forces.
While there is said to be
some friction between President
Qudsi and Prime Minister Azmah,
it does not appear sufficient
to bring about an early fall
of the cabinet. The cabinet
itself, however, is split be-
tween conservative and social-
istic elements, and friction
will. grow as time passes and
the prospect of new parliamen-
tary elections increases.P
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Adoula announced on 28
July that he intended to present
a new constitution for parlia-
mentary approval in September.
The proposed draft reportedly
would provide for a greater de-
gree of provincial autonomy than
the Belgian-drafted Loi Fon-
damentale under which the Congo
now operates. Leopoldville has
asked the UN to select special-
ists to help, and the Secretariat
is now trying to recruit Swiss,
Nigerian, and Canadian experts
on federalism.
Tshomb6 responded favora-
bly to Adoula's announcement,
but said he would await a show
of the premier's sincerity.
Tshombe's request that repre-
sentatives of all six provinces
participate in writing the con-
stitution would, if accepted,
probably impede progress. Am-
bassador Gullion has warned
that the politically weakened
Adoula probably cannot afford
extended discussion of consti-
tutional principles, and UN Act-
ing Secretary General Thant
suggests that for the same
reason Adoula may not be able
to make any important conces-
sions.
Adoula,who is very dis-
couraged with the slow progress
on the Katangan problem, may
still be thinking of trying to
exert more pressure on Tshomb6
by attempting new attacks in
northern Katanga. The movement
last week of the Fifth Battalion
from Stanleyville to Kabalo in
northern Katanga was reported
to be a normal rotation of troops.
The battalion it was to replace,
however, is still in place, and
the US and British military at-
tach6s believe that military
operations against Katangan
ground forces in Kongolo could
begin at any time.
Tshombd took a conciliatory
line in a press conference on
27 July, but UN, US, and other
diplomatic officials consider
this another psychological war-
fare move. Expressing his
"earnest desire" to resume nego-
tiations with Leopoldville,
Tshomb6 again called for Adoula
to appoint his members to the
four joint commissions agreed
on in June to regulate the dif-
ferences between Katanga and
the central government, and
urged that they report within
three months. Tshomb6 still
insists on a veto over the com-
missions' findings.
Tshomb6 is cocky and con-
fident of his position. He told
US Consul Hoffacker that Adoula
was "afraid of Tshombe's com-
petition" and was jealous of
his power and authority, and
told
that many people in Leopoldville
would like to see him as the
Congo's premier.
Meanwhile, anti-Adoula pol-
iticians, supported by Tshomb6,
are continuing their efforts to
line up support. Former vice-
premiers Jean Bolikango and
Chrisstophe Gbenye and former
minister of justice Remy Mwamba
have sought to enlist the back-
ing of UN civil affairs chief
Khiari and of the bishop of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Leopoldville, and on 29 July
a delegation headed by Gbenye
called on US Embassy officials
to bid for US support. They
said the Adoula government was
illegal, criticized Adoula`s
handling of negotiations with
Tshombd, and emphasized their
anit-Communist orientation.
Partially as a result of
consultations with his Congo
Adivsory Committee (CAC), com-
posed of UN members who have
contributed troops to the Congo
operation, Thant now believes
that the existing UN mandates
give him sufficient authority
to use economic pressures on
Tshombd and to assist the cen-
tral government's army in main-
taining law and order "in all
ways short of actual combat."
Thant remains firmly opposed to
any UN military initiative, how-
ever, and the CAC supports this
stand. He intends to present
a written report to the Security
Council between 10 and 15 August
on his plans for future action,
and, according to Under Secretary
Bunche, the UN is unlikely to
take any "dramatic action" on
the Congo before then!
UN, Belgian, British, and
French reception to the US
"package" proposals designed
to end the Congo stalemate has
been cool, with reservations on
both timing and procedures. The
plan calls for: a federal consti-
tution granting reasonable pro-
vincial autonomy; Katangan repre-
sentation in the central cabinet;
Tshombd's agreement to give half
of Katanga's mining revenue to
the central government; and a
merger of the Katangan gendarmerie
and Congo army. Thant agrees
generally with the US proposals
but doubts that Tshombd will
seriously negotiate, and be-
lieves that Adoula cannot risk
concessions without a more con-
vincing demonstration from
Tshombd of his readiness to re-
integrate.
Brussels, London, and Paris,
remain opposed to the UN's use
of force, and are not ready to
accept economic pressure against
Tshombd. Belgian officials
want to move very slowly on
pressure tactics and oppose
economic pressures which would
be carried out by Belgium and
Union Miniere alone. Britain
believes that the UN should be
prepared to tell Tshombd that
the UN military operation in
the Congo would be transformed
into an economic and technical
assistance program should he
agree to reintegrate. Paris
officials have made it clear
that France is not ready either
to initiate or to join in any
Western overtures to Tshombd and is
anxious to curtail the UN's role.
Any Lope that Portugal would
exert economic pressures on Tshombd
has been dimmed. Foreign Minister
Nogueira has expressed doubts
to US officials that the rea-
sons for exerting such pressures
are valid. Payment of Katanga's
mining taxes to Leopoldville,
he said, would not solve the
central government's economic
problems. Nogueira said it
was immaterial to Portugal
whether Katanga remained inde-
pendent or part of a federated
republic, but that the transit
of Katangan ores through the,
port of Lobito was important to
the Angolan economy and Lisbon 25X1
would look with disfavor on
any proposal to cease such
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The "full agreement" be-
tween Algerian political lead-
ers announced on 2 August ap-
pears to be a temporary solu-
tion prompted by realization
that the prolonged dispute had
aroused public indignation.
The compromise is favorable to
Ben Bella, and Vice Premiers
Belkacem Krim and Mohamed Bou-
diaf will probably continue to
oppose his efforts to gain con-
trol of the country. They have
powerful support--Kriir among
the Berbers, and Boudiaf among
the Algerians in France. Po-
litical maneuvering will con-
tinue to hamper the restoration
of effective government. Of-
ficers of the Algerian National
Army (ALN), now conscious of
their power as arbiters, may
resist establishment of a ci-
vilian government which would
reduce their personal power.
Terms of the compromise
were announced in Algiers.by
Ben Bella's top assistant, Mo-
hamed Khider. The seven-man
political bureau formed by Ben
Bella on 22 July will govern
the country until a meeting of
the National Revolutionary
Council (CNRA) in "about a month."
vigorous steps necessary to re-
vitalize the paralyzed adminis-
tration and economy until the
CNRA meets, or the power strug-
gle is otherwise clearly re-
solved.
The troops of Wilaya IV,
which occupied Algiers on 29
July, have stated that the city
is open to all responsible Al-
gerian leaders, and there is
no indication that they will
oppose the entry into Algiers
of Ben Bella and the members
of the political bureau. How-
ever, should Ben Bella attempt
to enter at the head of ALN
troops recently arrived in Al-
geria from Morocco, the troops
of Willaya IV--mostly units
Meanwhile, elections originally--ALGERIA
scheduled for 12 August are to
be held "probably on 27 August."
In the past the collegial leadership'
h
i
ion
Al
e
i
G
i
- - - ?
+
g
r
an
ov
ernment (PAG) was often reluc-
tant to take decisive action
without a clear mandate from
the CNRA, and the political bu-
reau is unlikely to take the
' 32584
---Algerian Liberation Army
military district boundary
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CURRENT INTELLIGENCE WEEKLY SUMMARY
which fought the war inside
Algeria--might react strongly.
Ben Bella reportedly realized
on 26 July that he could not
make a military advance through
Wilaya IV without risking civil
war, which he was not sure his
troops would accept.
Ben Bella has claimed that
the ALN troops which occupied
Constantine on 25 July were not
acting under his orders. The
brief "arrest" of Boudiaf on
30 July by Wilaya I troops loy-
al to Ben Bella also appears to
have been accomplished on the
initiative of local commanders.
ALN leaders in Wilaya I announced]
the creation of an "autonomous
zone" for the city of Setif on
31 July. Moreover, ALN units
have in effect been the local
governments in large areas of
the countryside following the
French withdrawal both before
and after the cease-fire agree-
ment last March.
There are indications that
Communist activity in Algeria
has been increasing, aided by
the almost complete paralysis
SECRET
of governmental administration
and law enforcement. The lib-
eral ex-mayor of Algiers,
Jacques Chevallier, told a US
Embassy officer in Paris on
17 July that there is "no re-
striction whatever" on persons
entering the country. The Al-
gerian Communist party (PCA),
now legal, has been attempting
to present itself as a mediator
in the dispute. On 27 July a
party communique deplored the
"hunger and misery" of the peo-
ple and demanded that "patriots"
form "committees of popular
union."
The USSR and bloc countries
continue to display a cautious
attitude toward Algerian devel-
opments.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
FRANCE-TUNISIA
The Paris consultations be-
tween Tunisian Defense Secretary
Ladgham and President de Gaulle
in July apparently convinced
Ladgham that the Bizerte naval
base is no longer of military
interest to France and will
soon be evacuated. Although
De Gaulle did not set a specific
date for evacuation
Both countries have hinted
that the consultations and re-
sultant agreements have been
prompted in part by the Alge-
rian situation. The French
Government apparently believes
it would be detrimental to
withdraw from Bizerte directly
after granting Algeria independ-
ence and prior to the forma-
tion of an Algerian government.
The embassy believes that con-
cerns over Algeria are playing
some part in France's attitude
toward its former protectorates
on Algeria's flanks. Tunisian
President Bourguiba also de-
sires to regularize relations
with France to bolster his
position against the possibil-
ity of an Algerian government
under leadership which would
be more radical than the group
with which he cooperated prior
to independence.
The southern portion of
the Bizerte base already has
been turned over to Tunisia,
and the rest of the base has
been almost completely evacuated
so that an actual agreement
would be largely a formality.
Although the Tunisian Govern-
ment hopes for French technical
aid in converting the base to
commercial and industrial uses
French Foreign Ministry offi-
cials allegedly are not sure
such aid will be forthcoming
because both the French mils- 25X1
tary and De Gaulle seem to
have lost intprpct in n; -+..
Bourguiba has publicly
interpreted Ladgham's consulta-
tion as the successful culmi-
nation of his policy of press-
ing for total French withdrawal,
but he is not hopeful of elicit-
ing assistance from France on
a scale large enough to allevi-
ate the economic stagnation in
the Bizerte area resulting from
the closing down of base facil-
ities. He is also fearful that
France may pull out its forces
completely without concluding
even a pro forma agreement,
thus depriving him of a hoped-
for moral victory.
The renewal of diplomatic
relations, which were broken
off in July 1961 when French
and Tunisian forces clashed at
Bizerte, will probably be con-
summated with an exchange of
ambassadors in September, after
which remaining problems are
to be discussed and resolved
through normal diplomatic chan-
nels. These include details in-
volved in thetransfer of Bizerte,
indemnification of French property
owners, status of French nationals25X1
resident in Tunisia, and renewal
of commercial and financial agree-
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CURRENT INTELLIGENCE WEEKLY SUMMARY
EUROPEAN POLITICAL UNION DEVELOPMENTS
Belgian Foreign Minister
Spaak, who was largely instru-
mental last April in blocking
further consideration of the
draft treaty for a European po-
litical union, has attempted in
recent weeks to find a basis for
resuming the treaty talks. On
18 July, some 30 political lead-
ers from the Common Market (EEC)
countries, Britain, and Scandi-
navia met with Spaak in Brussels
to discuss unofficially ways of
restoring momentum toward po-
litical union. It was the con-
sensus of the meeting that a mid-
dle way must be found between
the "unacceptable" draft treaty
and the "unrealizable" ambitions
of the federalists.
Spaak's new "plan" for
bridging this gap is to concen-
trate on the establishment of a
European political commission
which would serve as the "focal
point" for political integration.
For an interim period of perhaps
three years, this commission
would not have supranational
powers, but its members would
have the status of international
civil servants. Their main pur-
pose would be to make technical
studies of the problems of po-
litical union, maintain liaison
among the participating govern-
ments, and generally to provide
the kind of "activating force"
in the political sphere which
the EEC Commission has provided
so effectively in the Common
Market.
Since the Brussels meeting,
Spaak has obtained strong Nether-
lands support for his new ap-
roach
De Gaulle's attitude is not
yet clear. Spaak has in ef-
fect conceded De Gaulle's main
point that a federal Europe
cannot now be negotiated, and
his proposal for a political
commission bears some surface
resemblance at least to the old
Gaullist idea of a secretariat
servicing a loose confederation.
Nevertheless, the Belgians
remain apprehensive. Couve de
Murville gave Spaak no clues
as to his thinking when they
met on 25 July, and on 31 July
a Belgian Foreign Ministry
source told the US Embassy in
Brussels that he did not think
there was "much chance" De
Gaulle would agree.
Even if De Gaulle were to
agree to negotiate on the Spaak
plan, tricky procedural problems
would remain. A British Foreign
Office official told an American
Embassy officer on 30 July that
while London is "encouraged" by
Spaa,k's initiative and views
favorably his proposal for a po-
litical commission, Britain
nevertheless still wishes an
opportunity to participate in
the political union discussions
before final agreement is
reached. He implied, moreover,
that it would ease Macmillan's
domestic political problems re-
garding EEC entry if these dis-
cussions dragged on into Octo-
ber. Belgium and the Nether-
lands have long been loath to
present London with a fait
accompli in the form of an
agreed political treaty, but
De Gaulle and Adenauer both
feel that direct British par-
ticipation in the political
talks could give London the
position of "arbiter."
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CURRENT INTELLIGENCE WEEKLY SUMMARY
INCREASING PORTUGUESE PROBLEMS WITH OVERSEAS TERRITORIES
Increasing problems in
connection with Portugal's
overseas territories are aggra-
vating frictions within the
Salazar regime. A near polit-
ical crisis in Angola, together
with increasing signs of unrest
in Portuguese Guinea and dis-
satisfaction in Mozambique, has
strained relations between
Prime Minister Salazar and
Minister for Overseas Territories
part of Moreira's program by
Salazar, and calls into ques-
tion Moreira's political stand-
ing in the regime, as well as
that of his protege, Governor
General Deslandes. Moreira's
political rivals--such as
former Defense Minister Santos
Costa, who, like Moreira, is
reportedly ambitious to replace
Salazar but seems to be a
member of the antireform lobby
Moreira. If Salazar continues --are likely to attempt to ex-
to block Moreira's reform program,! ploit Moreira's discomfiture.
unrest will increase in the
territories. This in turn will In Portuguese Guinea,
increase opposition to Salazar i armed clashes between nation-
in Portugal. alists and Portuguese troops
are reported to have occurred
On 21 July the overseas
minister, reportedly under
pressure from Salazar, annulled
a decree by Angolan Governor
General Deslandes establishing
an Angolan provincial university.
o: cer recently returned from
the area expressed pessimism
over his government's ability
to hold the territory.
The governor general resigned
in protest, but at Lisbon's re-
quest agreed to remain, although
he insisted that in promulgating
Portugal's African prob-
lems are also continuing to
influence its foreign poli-
cies. Controversy has arisen
the decree he had acted within in the UN's Economic and So-
his competence as supreme com- c:Lal Council--many members
mander over Angola. of which disapprove of Lis-
The prospect of a crisis
in Angola as a result of this
episode subsequently impelled
Lisbon to authorize a local
university after all, but one
which would be under strict
control from the metropole.
At the same time the government
authorized establishment of a
similarly tightly controlled
university in Mozambique, where
it had sent the subsecretary
for overseas territories during
the first half of July to dis-
cuss local dissatisfaction with
Portuguese government policies.
This incident seems to
constitute a repudiation of
bon's African policies--
over Portugal's membership
in the Economic Commission
for Africa. Portuguese moves
to gain support in the UN
from the US on this and sim-
i]:.ar issues appear to be at-
taining the proportions
cam ai n.
granted permis- 25X1
Sion to the Chinese Communists
to send a mission to Angola.
Portuguese officials have also
hinted broadly that Lisbon's
approach to the forthcoming
negotiations on the Azores base 25X1
agreement with the US will be
influenced by UN considerations.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
PERU
The military junta which
seized power in Peru on 18 July
seems firmly established and in
control of the domestic situation.
It has received pledges of
support from all influential
groups except APRA, which re-
portedly has decided to confine
its opposition activities to
"political" criticism.
The failure of the general
strike called by APRA for 23
July marked the end of effective
resistance to the new regime.
All political parties except
APRA have accepted the junta's
promise of free elections in
1963 as evidence of its good
intentions. The business com-
munity, including US business-
men,regards the junta as a
stabilizing influence and is
supporting it. The Communists
and other supporters of Fernando
Belaunde Terry have welcomed
the takeover because of the mil-
itary's opposition to APRA. Belaunde
himself, however, has reportedly
withdrawn into semiseclusion and
may no longer be a political
factor.
APRA,,in adopting a policy
of nonviolent political op-
position, probably hopes that
it can regain its former mili-
tancy and discipline before
the 1963 campaign. Aprista
leader Victor Raul Haya de la
Torre is in hiding as a sym-
bolicprotest against the junta.
He plans to address a party
convention in August, presumably
to outline plans for APRA's future.
Some reports indicate that he
intends to be a presidential
candidate again in 1963; these
have not been confirmed by
Haya, who realizes that he
may be prevented from doing
so by the military. Meanwhile,
APRA representatives have been
negotiating with the junta
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because, they claim,APRA
leaders believe the junta must
be educated to Communist infil-
tration tactics---to which APRA
has, been exposed for many years- -
in order to prevent a Communist
victory.
The release of President
Prado on 29 July removed what
most European governments viewed
as the major barrier to recogni-
tion of the new regime. By
31 July, nine western European
governments had re-established
diplomatic relations with Peru,
and others are expected to do
so shortly. Tokyo and Taipei
announced recognition on 1 Au-
gust.The Latin American nations
are almost evenly divided between
those favoring recognition and
those opposed, but thus far
none except Haiti has announced
recognition. A Venezuelan
proposal to the Organization
of American States (OAS) for
a meeting of foreign ministers
to adopt some form of collective
action against Peru now seems
unlikely to be adopted, but the
OAS may call for an investiga-
tion by the Inter-American Peace
Committee (IAPC). If the matter
is referred to the IAPC or, as
has been proposed by the US, to
a special committee set up for
the task, most of the OAS nations,
anticipating a favorable outcome
of the investigation, probably
will re-establish diplomatic
relations.
Although the junta leaders
have denounced OAS action
"for public consumption," a
spokesman claimed in private
that the junta recognizes the
advantages of seeking a formula
for resolving the situation
and is prepared to be flexible.
The junta is said to be willing
to invite OAS observers to Peru
in order to avoid possible dis-
putes within the OAS council
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CURRENT INTELLIGENCE WEEKLY SUMMARY
PROSPECTS FOR THE NEW ADMINISTRATION IN COLOMBIA
President-elect Guillermo
Valencia of Colombia assumes
office on 7 August, succeeding
Lleras Camargo for a four-year
term. Valencia was elected
as the candidate of the National
Front coalition which re-estab-
lished constitutional rule and
restored political stability to
Colombia after the overthrow
of dictator Rojas Pinilla in
1957. Under the National
Front system, the two major par-
ties--Conservatives and Liberals--
agreed to share all elective
and appointive offices on a
parity basis and to alternate
the presidency every four
years until 1974.
Valencia--a 54-year-old
Conservative of aristocratic
background--is committed to the
strongly pro-Western,progres-
sive policies of the preceding
Lleras administration. However,
while Lleras succeeded in min-
imizing the traditional Con-
servative-Liberal hostility
and gained the cooperation of
leaders of both parties, Val-
encia lacks the prestige and
widespread support of his pred-
ecessor and may have difficulty
in maintaining cohesion in
the coalition. There is a
general lack of confidence in
his executive ability, and many
Liberals may be reluctant to
cooperate with him.
The government coalition
will have the advantage of a con-
gressional majority strengthened
in the March 1962 elections.
Antigovernment minority factions
of both major parties have been
weakened by internal dissension
and are unlikely to be effective
in their efforts to obstruct ad-
ministration programs.
leviate the chronic rural vio-
lence which has plagued Colombia
since 1948 and continues to
cause more than 200 deaths
each month. Most of the esti-
mated 75 criminal bands now
active are apolitical, but there
is increasing evidence of
Communist efforts to organize
them into a coordinated revolu-
titonary movement. Although
there is no immediate threat
of widespread insurgency, left-
ist subversive activities are
likely to increase.
Colombia has made substan-
tial advances toward industrial-
ization and export diversifica-
tion, but faces a serious balance-
of-payments deficit which may
reach $130 million in 1962, ac-
cording to official estimates,
The government is attempting to
reduce imports and is urgently
seeking an international agree-
ment aimed at stabilizing the
world coffee market from which
Colombia derives most of its
foreign exchange earnings.
Failure to halt the continuing
decline in coffee prices could
cause a financial crisis in the
near future.
Colombia has enthusiasti-
cally endorsed the Alliance for
Progress, and Valencia is ex-
pected to continue the vigorous
reform program initiated by
President Lieras. The incoming
administration's effectiveness
in fulfilling the reform goals
of the "General Plan for Econom-
ic and Social Development" will
determine to a great extent
whether Valencia will allay the 25X1
current apprehension concerning
the political future of the
country.
The new administration
will be under pressure to al-
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CURRENT INTELLIGENCE WEEKLY SUMMARY
CUBA'S 26 JULY CELEBRATIONS
This year's celebrations
of the ninth anniversary of
the Cuban revolution--which
the Castro forces date from
an abortive attack on an
army fortress in Santiago on
26 July 1953--brought few
surprises and contained most
of the elements that have
usually been associated with
the celebration of previous
Castro regime holidays.
Fidel Castro's 26 July
speech in Santiago de Cuba was
largely devoted to a reitera-
tion of standard propaganda
themes: the invincibility of
the revolution; the necessity
for a strong worker-peasant
alliance; the honest mistakes
made by inexperienced revolu-
tionary leaders; and the
"glories of socialism" and
its beneficences to come. He
also trotted out familiar,
emotionally delivered charges
of an impending US attack
and vowed that the territory
of the Guantanamo Naval Base
will be regained by Cuba through
legal means.
The speech contained one
new note: in commenting on
domestic shortages of shoes,
clothing, refrigerators,and
other items not now rationed,
Castro implied that the ration-
ing system would be extended
so that in the future the
"organized workers and poor
peasants" would get first
consideration in the distribu-
tion of such products..
No estimate of the size
of the crowd that listened to
Castro is yet available, but
the Guantanamo Naval Base re-
ports that on the day of the
speech only 588 of its 3,000
Cuban workers were absent, of
whom 381 had been previously
authorized to take leave. The
previous year, when the 26 July
festivities were centered sev-
era]. hundred miles away in Havana,
almost half the workers were
absent.
Celebrations of the 26
July anniversary abroad were
generally quiet and routine.
Government and party leaders in
most bloc countries sent con-
gratulatory messages to Cuban
leaders, most of which contained
passages commending Castro's
leadership and citing his re-
gime's ideological location on
the "road to socialism." Dur-
ing a Cuban Embassy reception
in Moscow, presidium member
Frol Kozlov said that "the old
warnings addressed to the im-
perialists are still in effect"--
thereby indicating that there
has been no recent redefini-
tion of the Soviet Union's
vaguely worded threat of military
assistance to Cuba in the event
of US aggression there. The
Chinese Communists topped
Moscow's gesture by sending
Premier Chou En-lai to speak at
the Cuban Embassy reception
in Peiping.
little publicity.
In Latin America, pro-Castro
celebrations on 26 July were gen-
erally quiet and orderly. About
4,000 people attended the one in
Montevideo, where Cuban leaders
Armando Hart and his wife Haydee
Santamaria gave speeches. Else- 25X1
where in the hemisphere the fes-
tivities were small and received
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SPECIAL ARTICLES
KHRUSHCHEV TIGHTENS CONTROLS OVER SOVIET FARMS
This March Khrushchev in-
stitutionalized party control
over the countryside and further
centralized farm management in
order to obtain a streamlined
administrative machine directly
responsible to him and capable
of executing his agricultural
policies. Like the clumsy bear,
donkey, monkey, and goat in a
popular Russian fable who keep
changing their seating arrange-
ment in the hope of perfecting
their musicianship, he is count-
ing primarily on his reorganiza-
tion to produce a dramatic up-
swing in farm output. The re-
organization is unlikely to ac-
complish this, however, because
it is mainly a reshuffling of
existing personnel and because
agriculture requires a high de-
gree of flexibility to take ad-
vantage of local conditions.
Like its predecessor, the new
system has already been blamed
for farm shortcomings which will
undoubtedly persist until the
regime exchanges bureaucratic
reshuffles for realistic plans,
fertilizer, and greater in-
centives.
Previous Management Systems
After Stalin's death Khru-
shchev took several steps to in-
crease adaptability to local
conditions and to stimulate in-
itiative on the farms. In 1955
collective farms (kolkhozes)
were at least nominally given
discretion to decide on crop
acreages. In 1958 the Machine-
Tractor Stations (MTS) were
abolished and the administrative
control they had previously ex-
ercised over the collective
farms was parceled out to
district (rayon) agricultural
departments under the jurisdic-
tion of the Ministry of Agri-
culture. At the same time rural
party committees (subject to a
hierarchy of party agricultural
department?3) continued to play
a major role in agriculture,
appointing farm leaders, direct-
ing the party units which by
now existed on virtually all
farms, and supervising production.
A plethora of other local organs
with ill-defined and overlap-
ping functions also concerned
themselves halfheartedly with
various facets of agricultural
management.
The blurring of authority
which accompanied these changes
increased what Khrushchev has
now denounced as a "drift in
agricultural leadership." Wide-
spread fraud and mismanagement
and repeated failure to meet
ambitious plans continued.
After 1958 there was an
almost continual debate in
Soviet journals on the question
of agricultural organization.
Some leaders proposed a re-
public or national hierarchy
of kolkhoz associations or
"un,ions" to simplify farm
administration and pool re-
sources. This politically ex-
plosive scheme was never adopted,
however, apparently because the
regime feared it would strengthen
the peasants' parochial in-
terests at the expense of state
control. Other officials pro-
posed closer ties between col-
lective and state farms at the
rayon level. Farm leaders re-
pea"tedly complained about ex-
cessive interference from local
party hacks and urged greater
autonomy for the farms.
Khrushchev's 1961 reorgan-
ization did not answer the
basic organizational questions
which had been raised in the
debates, and it failed to stim-
ulate production. The Ministry
of Agriculture--already weakened
by earlier reforms--was divested
of responsibility for farm
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CURRENT INTELLIGENCE WEEKLY SUMMARY
administration and machinery
repair. These functions were
scattered among several govern-
ment organizations including
a new Agricultural Machinery
and Supply Association called
Selkhoztekhnika and a new All-
Union State Committee for
Agricultural Procurement. As
a result there was no single
organization clearly in charge
of agriculture. The Ministry
of Agriculture was reduced
to directing agricultural re-
search and educational establish-
ments.
Following the administra-
tive re-juggling, penalities
for economic crimes were
strengthened, and a widespread
cleanup of local "mutual protec-
tion" cliques which had fostered
these abuses was initiated.
Present System
A third mediocre harvest
prompted Khrushchev in March
1962 to push through a new
arrangement for the farm manage-
ment hierarchy at a party cen-
tral committee plenum. This
reorganization strengthened
and formalized the party's
dominant role in farm manage-
ment to a greater extent even
than during the Stalinist
period.
Nominally topping the pyra-
mid is an All-Union Agricultural
Committee coordinating the
separate agencies to which agri-
cultural responsibilities had
earlier been diffused. Headed
by a deputy chairman of the
USSR Council of Ministers,
the committee unites the chiefs
of the party central committee's
agriculture department, the
USSR Ministry of Agriculture,
the State Procurement Committee,
Selkhoztekhnika, and the agri-
cultural sections of the state
planning agencies. According
to Khrushchev, the All-Union
Agricultural Committee will
not be directly concerned with
production but will check on
the fulfillment of party and
government decrees, especially
in regard to farm machinery.
The party presidium--particularly
Khrushchev himself and his chief
agricultural aide, G.I,Voronov,
who has spearheaded the current
reorganization--will continue
to decide agricultural policy.
The real power centers of
the new structure appear to be
the republic-level agricultural
committees and their counter-
parts at the provincial (oblast)
level. They have been given
full. powers to see to the
fulfillment of agricultural
plans and promote long-range
agricultural development. The
agricultural agencies in each
republic are represented on
the republic's agricultural
committee. At Khrushchev's
insistence, this committee is
headed by the republic party
first secretary, rather than
a lower ranking secretary
previously in charge of agri-
culture, so that the entire re-
public party organization will
bear full responsibility for
farm production. Several of
these republic bosses sit on
the all-union party presidium,
thus outranking N.G. Ignatov,
the head of the All-Union Agri-
cultural Committee who lost
his seat on the presidium last
October.
Each republic also has a
Ministry of Agricultural Produc-
tion and Procurement with direc-
torates at the oblast and inter-
rayon (a new unit encompassing
several rayons) levels. The
minis-try's head serves as deputy
chairman of the republic agri-
cultural committee and in most
cases is also first deputy
chairman of the Republic Council
of Ministers. Through the inter-
rayon directorates the ministry
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CURRENT INTELLIGENCE WEEKLY SUMMARY
is responsible for day-to-day
supervision of work on the
farms.
For the first time the
party boss in each territorial
unit from the republic through
the oblast level will be not
only a formal part of the state
administrative machinery for
agriculture but also the man
in his area directly in charge.
The forerunner of this new
organizational departure may
have been the 16 regional
councils which last year formal-
ized the direct participation
of the party in industrial
management. Previously, the
regime had carefully kept the
government machinery institu-
tionally separate from that of
the party.
Territorial Production Directorates
Some 960 territorial pro-
duction directorates have been
created as the crucial links
in the new chain of command.
Most of them encompass an area
of from three to six rayons and
include about 30 to 60 farms.
Both collective and state farms
were put under this one local
organizational umbrella, a step
which may bring closer the
regime's goal of a unified system
of state agricultural "factories."
The directorates are re-
sponsible for on-the-,spot
direction of all farmactivities--
production plans, crop structures,
state procurement deliveries,
incentives, technological ad-
vances, farm accounting, and
assignment of trained cadres.
Inspectors--each responsible
for three to six farms--will
implement these wide-ranging
duties with the help of the
directorate's "small but
efficient" pool of farm special-
ists. The directorates are ex-
pected to substitute personal
conferences in the fields for
the endless stream of paper
directives which formerly
issued from city headquarters.
Khrushchev recommended to
the March plenum that a party
organizer (partorg) be added to
each territorial production
directorate along with a phalanx
of party and komsomol assist-
ants. The partorgs are intended
to operate as on-the-spot
plenipotentiaries of the repub-
lic or oblast party committee.
Khrushchev specifically recommend-
ed as a model the powerful head
of the old MTS political
section who played a vigorous
role in supervising the whole
range of individual farm
operations, frequently interfer-
ing with the MTS directors'
prerogatives. Moreover, an April
1962 decree gave the partorgs
explicit responsibility for
those agricultural matters which
had been assigned to the direc-
torate and in addition made them
virtual overlords of the whole
interrayon area. Khrushchev
thus hopes to achieve fast
results in agriculture by rely-
ing on a vigorous party boss at
the local as well as the republic
level .
Each directorate has a
council chaired by the directo-
ratechief and including the part-
org, farm heads, and heads of
all the local units concerned
with agriculture. Such a large
group, meeting only every three
months, however, is mainly a
democratic facade.
Staffing the New Agricultural
Organ zation
Khrushchev has said that
the success of the new agri-
cultural management system de-
pends upon the selection of
experienced, well-trained cadres.
In fact, however, the reorganiza-
tion has so far simply reshuf-
fled men long involved in
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CENTRAL COMMITTEE
CPSU
USSR COUNCIL
OF MINISTERS
DMINiSTRATI VE
DIRECTION
CURRENT INTELLIGENCE WEEKLY SUMMARY
KHRUSHCHEV'S AGRICULTURAL MANAGEMENT HIERARCHY
ALL-UNION AGRICULTURAL
COMMITTEE
Chairman: A Deputy Chairman
of the Council of Ministers
Members: Heads of the four
bodies below plus head of the
all-union parry agricuHaral
department
COORDINON AND
CHECKIN6111N PLAN
FULFdiMMENT
STATE PROCUREMENT
COMMITTEE
REPUBLIC CENTRAL
COMMITTEE
REPUBLIC COUNCIL
OF MINISTERS
REPUBLIC AGRICULTURAL
COMMITTEE
Chairman: Republic Ist Party
Secretary
Members: Heads of the five
bodies below plus head of the
republic party agricultural
department
COORD%k*TION
AND RALL
SUPEI ON
TI)M !--IISIPATI VE
lIRECTION
OBLAST PARTY
COMMITTEE
OBLAST EXECUTIVE
COMMITTEE
MINISTRY OF AGRICUL-
TURAL PRODUCTION
AND PROCUREMENT
OBLAST AGRICULTURAL
COMMITTEE
Chairman: Oblast Ist Parry
Secretary
Members: Heads of the four
bodies below plus head of the
ablest party mgricultural
department
COORDINATI(AND
OVERALL SUPERVd5ION
OtMNISTRATIVE
DIRECTION
OBLAST DIRECTORATE OF
AGRICULTURAL PRODUC-
TION AND PROCUREMENT
INTERRAYON (TERRITORIAL)
PRODUCTION DIRECTORATE
PARTY ORGANIZER with
parry and kom'omol
-is ants
RAYON PARTY
COMMITTEE
RAYON EXECUTIVE
COMMITTEE
USSR MINISTR'! OF
AGRICULTURE
REPUBLIC MINISTRY
OF AGRICULTURE
(in the large,
republics)
OBLAST AGRICIIL-
TURAL RESEARC-I
INSTITUTE
COUNCIL OF THE
PRODUCTION
DIRECTORATE
USSR SELKHOZ-
TEKHN IKA
REPUBLIC SELKHOZ-
TEKHNIKA
OBLAST SELKHOZ-
TEKHNIKA
INTERRAYON
SELKHOZ-
TEKHNIKA
RAYON
SELKHOZ-
TEKHNIKA
USSR PLANNING
AGENCIES, AGRI-
CULTURAL DEPART-
MENTS
REPUBLIC GOSPLAN,
AGRICULTURAL
DEPARTMENT,
REPUBLIC MINISTRY
OF
,WATER ECONOMY
OBLAST DIRECTORATE
OF
WATER ECONOMY
Khrushchev has announced that the rayon administrative
division will soon be replaced by a larger unit based
on the interrayon production directorates.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
agricultural management. Heads
of some organizations criticized
by name still retain their
posts. The press has already
attacked "conservative" bureau-
crats who have failed to sub-
stitute a vigorous new approach
for time-honored red-tape
methods.
In most republics long-time
agricultural bosses were pro-
moted to the combined posts of
first deputy chairman of the
Council of Ministers and minis-
ter of production and procure-
ment. Most of the heads of
republic selkhoztekhnikas, water
economy ministries, and the re-
maining republic ministries of
agriculture were retained in
office. Although Khrushchev
specifically recommended that
party agricultural departments
be restaffed, at least six repub-
lic department heads kept their
posts. At the local level al-
most half of all rayon first
secretaries have been tapped to
head production directorates
and fill almost all of the
partorg positions.
It was Khrushchev's intent
that the best trained and most
experienced local administrators
be concentrated in the new inter-
rayon directorates where their
talents could benefit a larger
area. He himself had pointed
to the chronic shortage and
rapid turnover of qualified
personnel as a major drag on
agriculture. In some republics
less than a third of the agri-
cultural specialists are will-
ing to work in agriculture, and
many of these are ensconced
in comfortable urban desk jobs.
Friction at the Local Level
Khrushchev's decision to
transfer responsibility for farm
management to a new interrayon
unit aroused considerable dis-
satisfaction, especially among
local officials whose vested
interests were threatened.
Overlapping responsibili-
ties quickly set the entrenched
rayon party and government com-
mittees at cross purposes with
the directorates and their
pa:rtorgs. The rayon leaders
either abdicated all responsi-
bility for the farms or contin-
ued to manage the farms them-
se :Lves, duplicating or counter-
manding the work of the direc-
torates. Some rayon and Oblast
committees have tried to make
the directorates into subordinate
bureaucratic adjuncts or to
sabotage them.
Khrushchev cut this Gordian
knot by making public on 27
June an earlier presidium deci-
sion that the rayon structure
would soon be replaced by a
larger administrative unit based
on the production directorates.
He made it clear that in the
interim the directorate is
"the main and only leading organ
of farm production" accountable
only to higher party and govern-
ment organs. He further de-
clared that the partorgs have com-
-pleCe authority over farm party
organizations and that the rayon
party first secretaries should
be made their deputies.
This more centralized system
of farm management under strict
party control will probably
prove deleterious to agri-
culture. Local bosses will
have to be more responsive to
centralized directions for over-
ambitious targets, regardless
of local conditions or the long-
range needs of the area. Col-
lective farm managers are cer-
tain to resent the increasing
pressures which will be brought
to bear on the farms. I
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CURRENT INTELLIGENCE ~TEKLY SUMMARY
STRATEGIC HAMLETS AND COUNTERINSURGENCY IN SOUTH VIETNAM
In its effort against the
Viet Cong insurgents, South
Vietnam is emphasizing measures
aimed at isolating Viet Cong
troops from the peasantry,
tightening security and expand-
ing government control in the
countryside, and releasing ad-
ditional army troops from static
defense duties for offensive ac-
tions. One of the key measures
is the creation of strategic
hamlets--small fortified communi-
ties with some self-defense capa-
bility--now being pushed nation-
ally on a crash basis.
from growing Communist dissi-
dence and enjoy improved living
standards. The program was
quietly halted in mid-1961
after the completion of 29 of
a planned 60 new towns, largely
because of peasant resistance
to forced labor for construc-
tion and to forced abandonment
of ancestral lands. The govern-
ment began to turn its attention
increasingly to the hamlet, the
smallest and most vulnerable
community unit, where some
local authorities were already
building their own defenses.
The 2,400 strategic hamlets
reportedly completed so far vary
widely in their effectiveness.
Unlike other programs to which
the name has been loosely ap-
plied, the strategic hamlet
program is being implemented
largely by local authorities
using local resources. It
suffers from lack of well-de-
fined geographic priorities,
and from failure to be inte-
grated into regional and pro-
vincial military planning.
Steps are being taken to over-
come some of the weaknesses in
the program.
Background
The strategic hamlet pro-
gram and related rural pacifi-
cation programs are in part an
outgrowth of earlier measures
by the Diem government to consoli-
date its control. Among these
measures were the creation of
"resettlement centers" for
nearly 1,000,000 refugees from
Communist North Vietnam as well
as for assimilated minority
tribes from the central high-
lands, and "land development
centers" in the highlands to
expand government authority in-
to this remote, undeveloped
region and to relieve population
pressure along the coast.
In late 1959, a program
was started to group isolated
peasants in the Mekong delta
provinces south of Saigon into
new towns, called "agrovilles,"
where they could be protected
Strategic Hamlet Program
The decision to promote
a nationwide self-defense ef-
fort at the hamlet level was
made in January 1962, and an
Interministerial Committee for
Strategic Hamlets was set up
under the direction of Presi-
dent Diem's brother and chief
political adviser, Ngo Dinh Nhu.
National guidance is provided by
the Ministry of Interior, coop-
erating with such ministries as
Health and Civic Action--the
latter responsible for youth
and information activities.
Courses have been set up to
train civic action teams in or-
ganizational, propaganda, and
intelligence operations. Al-
though local committees have
been created by the various
province chiefs, actual re-
sponsibility for establishing
strategic hamlets rests with
lower level district, village,
and hamlet chiefs.
A strategic hamlet is es-
sentially a small fortified
community, surrounded by de-
fensive works, with a formal
administration and an organized
security system embracing its
inhabitants. The program is
currently developed almost en-
tirely around existing hamlets
which contain from 100 to 200
families and is applied in
stages: construction of fenc-
ing or other fortifications,
establishment of access con-
trols to weed out Viet Cong
agents, creation of a local
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self-defense system, and the
election of a hamlet council.
A government document suggest-
ing procedures for establishing
strategic hamlets indicates
that government cadres are to
try to influence these elections.
An effort is made to link de-
fense and warning systems to
nearby hamlets and the village
of which they may be components
and, with the assistance of the
civic action teams, to improve
living standards. In the pres-
ent early stages of the program,
some hamlets are relying on
protection from local Self-
Defense Corps troops or units
of the Civil Guard, but arms
are gradually being distributed
to reliable male inhabitants.
Defended Villages
Another government concept
also involves fortified, organ-
ized communities known as de-
fended villages. It is being
applied in several projects of
varying scale and name--usually
in areas under considerable
Communist influence--which have
in common the feature of re-
grouping or resettling popula-
tions in new villages. Re-
groupment is to be by persuasion
if possible but may require
force where peasants are strong-
ly sympathetic to the Viet Cong.
Among examples of voluntary
projects is the defended en-
clave at the extreme southern
tip of South Vietnam settled
by refugees from China under
the leadership of a priest,
Father Hoa. This settlement
has developed a paramilitary
force, the Sea Swallows, ac-
tively engaging the Viet Cong
in combat. Another voluntary
type of defended village
project is a group of small
resettlement centers for tribes-
men near Ban Me Thuot, where
an effort is being made grad-
ually to expand the area of
government control.
The most publicized de-
fended village project is
Operation Sunrise, a coordinated
0 Strategic hamlet concentration
E Operation Sunrise area
Operation Hal Yen
Delta Plan area
Major areas of Viet Cong concentration
Military region boundary
(South Vietnamese)
Province boundary
---~ Railroad
military and civilian operation
begun in Binh Duong Province
to the north of Saigon. Opera-
tion Sunrise started with mili-
tary operations to clear the
area of Viet Cong concentra-
tions, after which villagers
were rounded up to construct
new villages in more defensible
areas. An effort is being made
through information programs
to explain to the peasants the
reasons for the regroupment and
the advantages to be gained in
the defended villages. Three
such villages have been built,
and clearing operations started
for a fourth. Under South Viet-
nam's administrator for the
southeastern provinces, opera-
tion Sunrise relies on troops
made available by the province
chief and the regional army
division. Resettled peasants,
although provided food and sub-
sidy payments, construct their
own villages. At least initially,
the project attracted few males
SECRET
NORTH",
`? .Yrtf3 At
CA VfBODIA
C APITAL ZONE
s v am
Rural Counterinsurgency
Tang Iii Programs
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of military age. Operation
Sunrise, launched in a Viet
Cong stronghold between two
Communist base areas, has not
been attacked, but harassment
of army troops has occurred in
several ambushes nearby.
Operation Hai Yen
A more comprehensive mili-
tary-civilian program called
Operation Hai Yen is under way
in the central coastal province
of Phu Yen, a less afflicted
province but vital to the mainte-
nance of north-south communica-
tions. Under the direction of
the Second Corps commander,
this program is integrated into
provincial military planning in
three phases, moving from gov-
ernment-controlled to Viet
Cong - controlled areas. Work-
ing outward from the rice areas
around Tuy Hoa, where strategic
hamlets have been constructed,
military operations are pro-
ceding in the second phase to
less secure areas where many
peasants will be resettled in
defended villages. The program
now is encountering increased
Viet Cong military resistance,
but its relative success so far
has established it as a proto-
type for planning in two other
provinces to the north.
A broader plan, drafted
with British assistance to in-
corporate experiences of counter-
insurgency in Malaya, aims at
gradual pacification of the
Viet Cong - infested Mekong
delta provinces. Somewhat akin
to Operation Hai Yen, the plan
would involve military "clear
and hold" operations as well
as the strategic hamlet and de-
fended village concepts in an
entire region covering most of
ten provinces which are the re-
sponsibility of two army divi-
sions in the Third Corps.
The plan would seek first
to secure control of provinces
along the Mekong River and then
to clear the Cambodian border
area. Eventually it would free
Civil Guard and army units for
mobile operations at the pro-
vincial and regional levels.
The delta plan has been incor-
porated into Nhu's Interministe-
rialCommittee for Strategic
Hamlets, but some of its original
provisos concerning command re-
sponsibility and compensation
payments have been ignored, and
it has not yet received promised
priority.
Weakness in the Strategic
Hamlet Program
The Diem government is dis-
playing growing awareness of the
need to enlist public cooperation
and to develop clear priorities
for its limited resources if it
is to move ahead with broad
pacification plans. As a result
of the haste with which the
strategic hamlet program has been
pushed, many of the hamlets have
no defenses other than bamboo
fencing, and some are reported
to be infiltrated or influenced
by Viet Cong elements. In sev-
eral recent instances, guards
are reported to have assisted
the Viet Cong in attacking the
hamlets or destroying defenses.
Although some hamlets are
virtual fortresses and the in-
habitants are reported enthusi-
astic, in others peasant resent-
ment has been aroused by arbitrary
requisitions of labor and money,
by curfew systems which reduce
the time spent working their
fields, and by suspicions that
district chiefs are extorting
hamlet funds. A recent government
communique invited the hamlet
populations to submit complaints,
and the Interior Ministry has
set up a committee to ensure
remedial action. One assistant
district chief has been arrested
for abuses.
of more than 16,000 ham-
lets in South Vietnam, the gov-
ernment hopes to make about
7,000 of them"strategic" by the
end of 1962. Ngo Dinh Nhu ap-
parently expects that, in the
early stages, many will be
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CURRENT INTELLIGENCE WEEKLY SUMMARY
attacked, but he believes eventu-
ally they will help to identify
the Viet Cong in rural eyes as
the enemy. He also believes the
hamlet defenses will gradually
force the Viet Cong to attack
in larger concentrations, lead-
ing to more conventional combat
with government troops.
Starting first in relatively
safe areas, the program is to be
expanded into less secure areas,
requiring some population reset-
tlement into defended villages.
As a long-range plan, Nhu hopes
to re-establish some agrovilles
on the fringe of Communist base
areas. This expansion of the
program will require greater
coordination with military opera-
tions than is now the case.
Saigon recently took a step to-
ward remedying this weakness by
creating strategic hamlet com-
mittees in each army division
zone, with the division commander
as chairman and province chiefs
in the zone as members.
Strategic Hamlets Change
Nhu has also promoted the
idea that strategic hamlets might
serve as a vehicle for radical
changes in South Vietnamese
society through administrative
-reforms and benefits at the ham-
let level--previously a neglected
area of national authority. The
program would provide a practical
application of the government's
vague philosophy of "personalism,"
which Diem and Nhu regard as an
alternative to both Communism and
Western liberalism. Strategic
hamlets have been proclaimed as
the answer to "Communism, poverty,
and disunity," and Nhu has talked
of replacing the traditional so-
cial order, dominated by landlords,
with a new one favoring anti-Com-
munist fighters, their families,
and productive workers.
Internal Criticism
Some government officials
feel that the program fails to
meet the needs of the emergency.
Among them is Ngo Dinh Can,
another brother of President Diem
and the dominant political figure
in the central and northern part
of the country. Can, whose rela-
tions with Nhu have long been
characterized by an undercurrent
of friction, is promoting a dif-
ferent approach which he calls
"Popular Forces," well-trained and
armed political cadres to work
with the peasants against the Viet
Cong. Sources close to Can have
criticized the "superficial" plan-
ning of the strategic hamlet pro-
gram and claimed many such hamlets
in central Vietnam are under Com-
munist control. Recent reports,
however, indicate that Can and Nhu
feel that both approaches can
operate simultaneously with mutual
ad-vantage.
In the central and northern
region, a growing number of moun-
tain tribesmen now are reported to
be seeking government protection.
These tribesmen are probably moti-
vated in part by Viet Cong harass-
ment and competition for food and
in part by concern over expanding-
war operations. They confront the
government with a substantial refu-
gee problem as well as a challenge
to win the loyalty of minority
groups long exposed to Communist
influence.
Vulnerability of Hamlets
Communist propaganda. has re-
vealed extreme sensitivity to
both the strategic hamlet and de-
fended village projects--described
as "herding the people into con-
centration camps." Scattered at-
tacks have occurred against many
strategic hamlets, as well as
against the larger agrovilles
and land development centers.
During July the Viet Cong pro-
claimed a campaign to destroy
strategic hamlets. Reports and
captured documents indicate that
the Communists are devoting con-
siderable effort to coping with
the program.
In the present stage, there
is little question that many stra-
tegic hamlets are ineffective
against attack or Communist infil-
tration. Since the purpose is to
control as well as to protect the
peasants, hostility to the program
in some cases may encourage coop-
eration with the Viet Cong. While
the program has continued to move
ahead, Communist efforts to destroy
it are likely to intensify, and con-
tinuedlack of coordination with 25X1
other counterinsurgency measures
adds to its vulnerabilit .
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