WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A004000110001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 28
• Document Creation Date: December 21, 2016
• Document Release Date: July 7, 2008
• Sequence Number: 1
• Publication Date: May 31, 1963
• Content Type: SUMMARY

31 May 1963
OCI No. 0282/63
Copy No .
OFFICE OF CURRENT INTELLIGENCE
NAVY review
completed..
CENTRAL INTELLIGENCE AGENCY
GROUP I Excluded from automatic
downgrading and declassification
State Dept. review
completed
WEEKLY SUMMARY
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(Information as of 1200 EDT, 29 May 1963)
SOVIET AND CUBAN MILITARY ACTIVITY
This week's activity included indications that San-
tiago de las Vegas camp has been taken over by Cu-
bans, surface firing at a US patrol plane, and
aircraft passes over a US radar picket ship.
SIGNIFICANCE OF SOVIET-CUBAN COMMUNIQUE 2
As the Soviet-Chinese bilateral talks approach, Cas-
tro's endorsement of Moscow's positions on.issues in
dispute with Peiping is a victory for Khrushchev.
USSR AGAIN PURCHASING WESTERN INDUSTRIAL PLANTS
Its current shopping list is more restricted than
the $1 billion worth of equipment bought in 1960-61,
and concentrates on fields where Soviet shortages
exist--particularly fertilizers and synthetics.
NEGOTIATIONS ON RUMANIAN-CEMA DIFFERENCES
Soviet and East European leaders have been holding
a series of bilateral conferences since the CEMA
Executive Committee session ended on 14 May.
SINO-MONGOLIAN BORDER COMMITTEE MEETS
Peiping continues eager to convey an image of
reasonableness on boundary questions.
DEADLOCK PERSISTS IN LAOS 7
The UK and USSR have issued an appeal for restora-
tion of peaceful relations among Laos' factions, but
no accommodation is likely without significant. con-
cessions to the Communists from Premier Souvanna.
HANOI'S AID TO LAOTIAN AND VIETNAMESE COMMUNISTS 8
It seems to be improving its ability to aid the Com-
munists controlling south-central Laos, through which
run the major infiltration routes to South Vietnam.
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ASIA-AFRICA (continued)
BORDER ISSUE HAS LITTLE EFFECT ON INDIAN VOTING
In the first balloting since the border military
disasters last fall, the opposition was unable to
move Indian voters from their usual preoccupation
with a candidate's caste, religion, and personality.
ARAB STATES
Cairo propaganda has begun to attack Iraqi as well
as Syrian Baathists following a new roundup of non-
Baathists in Baghdad.
AFRICAN LEADERS' MEETING
Last week's summit conference in Addis Ababa adopted
an African charter reflecting the approach of moder-
ate leaders to continental solidarity and endorsed
militant moves toward "decolonization."
Page
NEW TROUBLES IN THE CONGO 12
The UN's plans to withdraw its forces coincide with
the danger of new outbreaks of disorder in Katanga.
CYPRIOT COMMUNAL LEADERS' TALKS REMAIN STALLED 13
President Makarios now suggests he may take the
problems of the Greek and Turkish communities
to the UN.
GATT MEETING STILL LEAVES US-EEC ISSUES UNSETTLED
A compromise brought agreement on substantial,
across-the-board tariff reductions for industrial
products in general, but calls for "special rules"
--which must still be worked out--in cases where
there are "significant" disparities in tariff
rates. Other problems remain unresolved.
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EUROPE (continued) Page
GENERAL ELECTIONS IN ICELAND
The two presently governing parties, whose poli-
cies have contributed to economic stabilization
and to elimination of once-sharp US-Icelandic
frictions, are expected to retain power.
THE HAITIAN SITUATION
The Duvalier regime continues to terrorize opposi-
tion forces, to blame the US for Haiti's troubles,
ARGENTINE POLITICAL DEVELOPMENTS
While some Peronists continue preparations to take
part in the 7 July elections, other Peronists are
staging protest demonstrations--susceptible to Com-
munist exploitation--which could disrupt them.
PERUVIAN INSURGENTS THREATEN ELECTORAL PROCESS
Cuban-trained guerrillas appear to be trying to
carry out their threat to create disturbances to
force cancellation of the 9 June ;elections.
DEVELOPMENTS AT NATO MEETING IN OTTAWA
The main event was establishment, as expected, of
an inter-Allied nuclear force; the proposed multi-
lateral force was not formally discussed. There
was little disposition to increase defense spending.
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Observations of the Soviet
armored camp at Santiago de las
Vegas on 20 and 23 May indicate
that it may have been evacuated
by Soviet personnel and taken
over by Cubans.
last saw Russians thereon
April. However, there is no
evidence that Soviet personnel
from this camp either left Cuba
or moved elsewhere.
On 26 May a US Navy patrol
plane was fired on six miles off
Cayo Frances, on Cuba's north
coast, by a coastal defense bat-
tery and a Cuban frigate. The
shots came no closer than one-
half mile and may have been in-
tended as a warning. In addi-
tion, during the past week two
Cuban air patrols made identifi-
cation passes over a US radar
picket ship off the northern
coast. Incidents of this kind
reflect increased Cuban concern
over coastal defenses and exile
raids,
There have been no addi-
tional indications of Cuban
involvement in the air defense
system during the past week.
About 150 Soviets, in-
cluding some 40 women, were ob-
served on the deck of the Soviet
passenger ship Maria Ulyanova
when it left Havana o May.
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SIGNIFICANCE OF SOVIET-CUBAN COMMUNIQUE
The Soviet-Cuban joint state-
ment and speeches on 23 May re-
flected the great importance the
Soviet leaders attached to Cas-
tro's visit as a symbol of Cuban
support of Soviet views. As the
time for Moscow's bilateral talks
with the Chinese Communists ap-
proaches,,Castro's endorsement of
Soviet positions on a wide range
of issues in dispute with Peiping
marks a major achievement for
Khrushchev.
Soviet-Cuban pronouncements
were designed to demonstrate that
the two governments have -reached
agreement on major policy ques-
tions and have succeeded in re-
moving irritants produced by the
missile crisis. The communique
claimed that the talks resulted
in "complete mutual understanding"
and an "identity of views" on
all questions discussed. In con-
trast to his earlier criticisms
of Khrushchev's behavior, Castro
praised the "timely and energetic"
actions of the USSR, and the com-
munique;hailed the "straight and
sober evaluation of the situ-
ation" by both Soviet and Cuban
leaders which "prevented thermo-
nuclear war."
Khrushchev's speech and the
joint statement suggest that both
governments intend to continue
their present cautious line of
easing tensions in the Caribbean
and avoiding provocations to the
US. The thrust of Khrushchev's
remarks on Cuban internal affairs
was that the Castro regime should
concentrate on consolidation and
economic development rather than
foreign revolutionary adventures.
He ridiculed "imperialist" char-
ges that Latin American revolu-
tionary movements are directed
by "some mythical hand of Moscow."
Although Khrushchev warned
that US moves to aggravate the
situation "might" create a crisis
more dangerous than the October
missile crisis, the reaffirmation
in his speech and in the communi-
que of the Soviet pledge to come
to Cuba's assistance in the event
of a US attack did not go beyond
previous ambiguous statements.
The avoidance of a binding and
automatic Soviet military com-
mitment again reflects Moscow's
desire to retain some flexi-
bility in dealing with any new
crisis over Cuba.
This caution was also evi-
dent in the treatment of such
sensitive issues as US over-
flights, the Guantanamo base,
and Soviet military assistance.
The communique simply renewed
Soviet support of Castro's
"Five Points" of last November
which included US evacuation of
Guantanamo and a cessation of
violations of Cuba's airspace
and territorial waters by "US
military aircraft and warships."
The statement cites past and pres-
ent Soviet assistance in strength-
ening Cuba's "defense potential,"
but said nothing about future
military aid. The pronouncements
provided no indications of So-
viet intentions regarding further
withdrawals of military person-
nel or transfer of Soviet-con-
trolled military equipment to
the Cubans.
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Although the communique
said agreement was reached on
"measures for the further develop-
ment of economic, trade, and
scientific-cultural relations,"
it contained-.no new Soviet eco-
nomic commitments. However,the
USSR did agree to pay the Cubans
the prevailing world market
price for sugar--now about 12
cents a pound--rather than four
cents as specified under earlier
agreements, thus removing the
major irritant in Soviet-Cuban
economic relations at a nominal
cost. Payment of a higher price
will hold down the' Cuban debt
to the USSR and probably elimi-
nate the need for massive Soviet
balance-of-payments support
this year.
On intrabloc affairs, the
communique's reaffirmation of
the 1957 and 1960 Moscow state-
ments on Communist strategy and
Khrushchev's militant remarks
on supporting foreign parties
and liberation movements were
clearly designed to demonstrate
the USSR's revolutionary fervor
and ideological purity. Although
Khrushchev stressed the supreme
importance of Communist unity
and pledged that the Soviet par-
ty would do its "utmost" in the
talks with. the Chinese to remove
differences in the 'Finterpreta-
tion of certain questions," the
emptiness of this pledge was evi-
dent in his uncompromising re-
statement of Soviet positions
and his indirect attacks on those
of the Chinese.
The Soviet-Cuban statement
and the one signed by the Chi-
nese and New Zealand Communist
parties on 25 May show no dis-
position on either side to com-
promise on basic issues. While
the Khrushchev-Castro communi-
que stressed the advantages of
"peaceful coexistence" in pro-
moting Communist influence and
the "struggle for socialism,"
the Chinese- New Zealand party
statement condemned coexistence
as a means of peaceful transi-
tion to socialism. The Chinese
also used this occasion to sin-
gle out "adventurism and capit-
ulationism"--Peiping's charac-
terization of Soviet actions in
the Cuban crisis--as "extremely
wrong and harmful."
In the weeks remaining be-
fore the bilateral talks begin
on 5 July,,each side will probably
take advantage of similar occa-.
sions to issue statements designed
to demonstrate backing for its
views within the Communist
movement.
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31 May 63 CURRENT INTELLIGENCE WEEKLY SUMMARY
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The Communist World
USSR AGAIN PURCHASING WESTERN INDUSTRIAL PLANTS
The USSR is again on a
buying spree in the West, ac-
companied by increased exchanges
of trade missions and publicity
from both sides on East-West
trade. Moscow's shopping list
concentrates on fertilizer and
other chemical and petrochem-
ical plants and a wide variety
of ships, but also includes
textile equipment, machinery
for processing ores, oil re-
finery equipment, and wood-
processing machinery.
Current Soviet activity
is more restricted in scope
than the buying splurge of
1960-61, when the USSR placed
orders for Western plants worth
about a billion dollars. That
equipment is being delivered,
and orders now being placed
cover shipments to be made dur-
ing the next few years.
In recent months the USSR,
in addition to its usual pur-
chases of miscellaneous indus-
trial items, has bought complete
plants worth $125 million and
is continuing negotiations with
industrialists in Western Europe
and Japan. Unlike the orders
in 1960-61, when Moscow appeared
primarily interested in securing
the advanced technology avail-
able in the West, current pur-
chases and negotiations seem
largely designed to increase
production in fields. where im-
portant shortages persist--par-
ticularly fertilizers and syn-
thetics which have lagged behind
plans and are far short of
requirements. A significant
proportion. of current.order.s
will help expand.agricultural
output and ultimately provide
additional consumer goods.
British and West German
traders who visited Moscow in
May have been enthusiastic
about prospects. The USSR,
however, is exploiting competi-
tion among West European sup-
pliers to secure the most fa-
vorable trade terms.
The chronic shortage of
foreign exchange--although
mitigated
by sales of
gold
averaging
$200
million
an-
nually--still
tends to
limit
Soviet imports. Moreover,.
the USSR already owes nonbloc
suppliers about $500. million
for previous purchases.
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High Soviet officials and
East European leaders have been
holding a series of bilateral
conferences since the Executive
Committee of the bloc's Council
for Mutual Economic Assistance
(CEMA) ended its session on 14
May. The meetings are apparently
concerned with CEMA integration
policies, including Rumania's
opposition to certain of them.
Rumania's stubbornness was
one reason for Hungarian party
boss Kadar's hastily arranged
talks with Poland's Gomulka from
16 to 18 May, Polish officials
report. Polish trade officials
frankly told US Embassy
officers that Rumanian party
First Secretary Gheorghiu-Dej
is "acting like De Gaulle."
Kadar is seeking informal ties
with the Polish - Czechoslovak -
East German economic group within
CEMA because Rumanian-Hungarian
economic collaboration "does
not seem workable," according
to a reliable embassy informant.
Kadar, when he returned
home from Warsaw, convened the
Hungarian central committee on
23 May to discuss a broad range
of economic questions. The
official statement issued at the
end of the session specifically
approved the CEMA integration
plan, including those aspects
the Rumanians have found objec-
tionable. It also did prepara-
tory work for Hungarian partici-
pation in the 18th CEMA session,
a somewhat unusual practice that
may indicate the seriousness with
which Budapest views Rumanian-
CEMA differences.
Following an early May
meeting between the Soviet
ambassador and Gheorghiu-Dej, a
high-level Soviet party dele-
gation led by?presidium member
Nikolay Podgorny arrived in
Bucharest on 24 May. It met
with Gheorghiu-Dej and six
other Rumanian officials,in-
cluding the permanent repre-
sentative to CEMA. A visit
of this type could have afforded
an opportunity to discuss
Rumanian-Soviet differences
over CEMA.
Coincidental with the
arrival of this delegation was
the highly unusual publication
by Bucharest of criticism of
the defective quality of some
Czechoslovak equipment. Delay
in deliveries is also a problem--
one of sufficient concern to.
lead the Rumanians to discuss the
matter with a group of Czech-
oslovak technical specialists.
Another Soviet party dele-
gation, led by Central Com-
mittee Secretary Demichev,
made an unexplained stopover
in Bucharest on 26 May en route
to Moscow after a two-week
visit to Bulgaria. It probably
was in Sofia to discuss party
affairs, although Demichev could
also have been coordinating
Bulgarian support for Moscow's
CEMA position.
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SINO-MONGOLIAN BORDER COMMITTEE MEETS
CHINA-MONGOLIA BOUNDARY
0 100, 2001 3(00 K I ' 1e,
~.dr A-
,ed br 6 0S G--me?t
33483
The Chinese Communists appar-
ently are anxious to nail down
details of the border treaty they
signed with Outer Mongolia last
December. New China News Agency
announced on 20 May that the
first meeting of the Sino-Mon-
golian Joint Boundary-Surveying
Committee in Ulan Bator had
ended in agreement.
Peiping's continuing eager-
ness to convey an image of
reasonableness on boundary
questions, coupled with the fact
that the border area in this
case is generally desolate and
so far as is known contains no
valuable mineral deposits, makes
it likely that the committee
will finish its task without
any major disputes.
-..~ Boundary as shown on the
most recent Russian and
Mongolian maps
Boundary as shown on the
most recent Chinese
communist maps
Paorou * Selected points of Sino
f,1 a~r Mongolian boundary treaty
The several hundred boundary
points mentioned in the treaty
must still be definitively lo-
cated on the ground by a survey,
a project which will require
considerable time to complete.
As described in the treaty,
the border appears to confirm the
boundary shown on standard Soviet
and Mongolian maps. Most of the
more unrealistic Chinese claims
have been eliminated, particularly
in the extreme western sector
along the Altai Mountain range.
Perhaps in compensation, the
Chinese have been awarded addi-
tional territory in the eastern
Sinkiang region which Peiping
in recent years had assigned
to Mongolia.
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On 29 May, Britain and the
USSR, acting in their capacity
as co-chairmen of the Geneva
confernece on Laos, issued an
appeal for restoration of peace-
ful relations among the three
Laotian factions. They acted
after receiving a special re-
port from the International
Control Commission noting the
deteriorating military situa-
tion and urging their interces-
sion to arrange an effective
cease-fire.
It is possible that these
efforts could lead to resump-
tion of talks between Premier
Souvanna and Pathet Lao leader
Souphannouvong, but a settle-
ment of outstanding issues
would appear unlikely without
significant concessions on
Souvanna's part.
A primary aim of the Com-
munists is to force the with-
drawal of Lao Army and Meo
troops who are backstopping
Kong Le's neutralist forces in
the Plaine des Jarres and other
areas. In the absence of ef-
fective controls, removal of
this support would leave Kong
Le defenseless against the
Communists.
While the Communists might
prefer to achieve their ends
through negotiation, they con-
tinue to improve their military
posture for any resumption of
fighting. In the Plaine des
Jarres area, particularly,
Pathet Lao and dissident neu-
tralist forces appear in good
position to move against Kong
Le with little warning.
Despite urgent corrective
efforts, on the other hand,
Kong Le's forces still show
serious deficiencies in logis-
tical and command organization.
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!""-Pq4
uong Yo
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BURMA MuongILn RHONG SALY
---Kam Tha /
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II NAMTHA
Luang^
Pr,pbang
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Ban Song Hoc
i
ng Het
HAMM(I
Nho
Muang
Ubon.
Thanh
Hoa
VARY BARRACKS
STORAGE AREA
SOUTH,
VIETNAM
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HANOI'S AID TO LAOTIAN AND VIETNAMESE COMMUNISTS
North Vietnam is apparently
improving its ability to assist
Communist forces controlling
south-central Laos, through
which run the major infiltration
routes to South Vietnam.
Hanoi may intend to resume,
or possibly has already resumed,
air resupply flights to Tchepone,
the major terminus of the Com-
munist airlift to southern Laos
last year. Evidence of increased
truck activity near the Tchepone
field was detected
a military instal-
While this installation may
be related to normal border se-
curity activities, it could serve
as an infiltration way station.
An extensive complex of trails
used by infiltrators crosses the
border in this vicinity. The
construction of facilities in
this region is also a natural
development in Hanoi's efforts
to help Communist forces main-
tain control of the adjacent area
of Laos. Greater logistic sup-
port for these forces may be in-
dicated by recent reports of in-
creased truck traffic down the
Communist-controlled fair-weather
road linking routes 9-and 12
in Laos.
The over-all increase in
North Vietnamese activity could
indicate an intention by Hanoi
to increase its capability to
infiltrate guerrillas into
South Vietnam. Hanoi may
be concerned over the danger
of Laotian right-wing or neu-
tralist military pressure
against the infiltration route
area, and may also desire. to
protect it against possible
harassment by South Vietnamese
forces. In mid-April, the
Pathet.Lao claimed that a
South Vietnamese force attacked
Mu.ong Nong, a major infiltra-
tion junction southeast of
Tchepone in Laos.
lation in southwestern North
Vietnam adjacent to Laos has
been considerably expanded since
it was detected in January 1961.
It is not certain, however, how
much of the expansion occurred
during the past few months. The
installation now consists of 39
barracks and additional support
and storage buildings estimated
to be capable of housing up to
900 men and 60,000 square feet
of supplies. It is served by a
road which runs toward Xom Bang
in North Vietnam.
31 May 63
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BORDER ISSUE HAS LITTLE EFFECT ON INDIAN VOTING
By-elections in 12 Indian
states during the past few weeks
--the first since last fall's
crisis on the Himalayan border
--indicate that the opposition
parties have in general been un-
able to use the government's
military blunders to arouse
Indian voters from their usual
preoccupation with the caste,
religion, and personality of the
candidates.
Of 36 seats at stake, 15
changed hands, but with little
net change in party strength.
Twenty-nine of the contests
were for seats in state assem-
blies, where Prime Minister
Nehru's Congress Party showed
a net gain of four. Communist
candidates were few; the party
gained a seat in Kerala, lost
one in West Bengal, and supported
winning Congress candidates in
several other races.
National attention was fo-
cused mainly on the races for
seven vacancies in Parliament.
Here the conservative Swatantra
Party retained. one seat and
gained another, the right-wing
Hindu Jan Sangh lost one it had
held, and the Congress suffered
a net loss of only two.
Two of the Congress'parlia-
mentary reverses, occurring in
the state of Uttar Pradesh, have
produced considerable soul-search-
ing in the party. Both had
been made prestige contests by
the Congress leadership and both
were won by nationally known,
long-time critics of the govern-
ment's general policies. No
less than 20 state and national
ministers were at one point en-
gaged in stumping for the Congress
in the two constituencies, only
to have both races lost through
clumsiness on the religious ques-
tion and because of a failure to
sustain the effort through the
final moments of the campaign.
Indian voters queuing to cast ballots in by-election
(19 May 1963).
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ARAB STATES
The roundup of anti-Baath
elements announced by the Iraqi
Government on 25 May has intensi-
fied the struggle between Nasir
and the Baathists and made less
likely an Egyptian reconciliation
with Iraq--or Syria.
Approximately 85 army
officers and civilian politicians
were arrested. While elements
of virtually every political
grouping were included, the round-
up seems to have been directed
primarily at pro-Nasir groups.
Cairo news media have so
far given factual coverage to
the arrests but have played
down their anti-Nasir aspect.
On 27 May, however, Cairo's
clandestine radio attacked the
Baathist regime in Iraq for its
suppression of nationalist
elements.
The Egyptians previously
had been reluctant to attack
both the Iraqi and the Syrian
Baathists at the same time.
Cairo's attacks on the
Syrian Baathists are continuing
but are more and more concen-
trated on specific party leaders.
A Cairo editorial by a confidant
of Nasir, published late last
week, suggested that if the
Syrian party cleansed itself of
its "old-guard" leadership, the
UAR and the Syrian Baath could
get along. Two days later, a
Cairo clandestine radiobroadcast
called on Syrians to kill.Baath
leaders Bitar and Aflaq.
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AFRICAN LEADERS' MEETING
In an atmosphere of general
rapprochement, the African sum-
mit meeting in Addis Ababa be-
tween 22 and 26 May projected a
framework for intra-African com-
munication and cooperation. A
charter creating an Organization
of African Unity (OAU) incorpo-
rates in large measure the grad-
ualist approach to continental
solidarity and the operating
principles favored by the moder-
ate Monrovia grouping. For the
most part, the conferees confined
themselves to issues of immedi-
ate concern to Africans.
Heads of state or govern-
ment endorsed the charter for
28 of the 33 independent African
countries, and lesser represent-
atives signed for two others.
Morocco, which boycotted the
meeting ostensibly because of
Mauritania's presence, will prob-
ably soon follow suit. Togo was
not seated, presumably in defer-
ence to Guinean President Toure's
continuing opposition to the
Grunitsky regime, but reportedly
will be given an opportunity to
adhere. South Africa, of course,
was never invited.
The charter, adopted in the
face of a strong plea by Ghana's
Nkrumah and his large retinue
for immediate organic union,
follows in its essentials a
draft prepared in advance for
the Ethiopian Government by
Chile's representative to the
Organization of American States.
It provides for a summit-level
assembly to meet annually, a
ministerial council to meet at
least twice yearly, a perma-
nent administrative secretariat,
a conciliation commission, and
five specialized functional
commissions. These institu-
tions presumably will super-
sede the rival "systems" de-
veloped by the militant Casa-
blanca powers in 1961 and by
the Monrovia states last year.
However, basically regional
groupings, such as the now
well-established African and
Malagasy Union of 13 French-
speaking states, can be ex-
pected to continue and prob-
ably even to proliferate.
It will be some time before
the OAU charter comes into
force, and there is likely to
be intense haggling over details
of the new pan-African structure,
including the designation of key
personnel. It now appears that
the secretariat will be located
in Addis Ababa,with assembly
and council meetings rotated
among other capitals and the
various commissions head-
quartered elsewhere. Tour6
has announced that a meeting
of OAU foreign ministers is to
be held in Dakar next month to
chart the next steps.
With Tour6, Nkrumah,
Algeria's Ben Bella, and Uganda's
Obote leading the way, the
conferees also endorsed a
strongly militant posture in
support of "freedom fighters"
in still-dependent territories
and in South Africa. A nine-
nation committee is to be set
up in Dar-es-Salaam to coordinate
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assistance to nationalist move-
ments--21 of which had observer-
lobbyists, recognized by the
conference, in attendance.
Each independent state was asked
to contribute to a special "lib-
eration" fund by 15 July and
to develop a corps of volunteers
able to provide wide-ranging aid
to the nationalists.
The practical effects of
such decisions and of the com-
US and UN officials in the
Congo are alarmed by UN Secretary
General Thant's proposal to with-
draw UN forces. They report that
by the end of this year no more
than two and a half Congolese
Army battalions will have suffi-
cient training to be reliable for
maintaining order. These offi-
cials foresee disturbances be-
tween the civilian population
and the army in Katanga, and
possibly another mass flight of
Belgians. Thant, preoccupied
with the UN's financial problems,
has planned to withdraw all UN
troops by 31 December--and might
do so even earlier.
In Katanga tensions still
remain high, although European
workers at the Union Miniere
plants in Jadotville have re-
turned to work following a strike
over the killing of one of their
colleagues by a Congolese soldier.
A serious incident nearly took
place in Elisabethville on 24
May when the central government
representative there decided to
use Congo Army troops to strip
prehensive sanctions invoked
specifically against South
Africa and Portugal are likely
to be limited, at least for
the present, and there has been
little reaction from these two
governments. The Portuguese
in particular still appear con-
fident that little change in
their present policies is re-
quired to parry thrusts likely
to come from the Addis Ababa
"liberators."
Tshomb6 of his Katangan gendar-
merie bodyguard. The troops were
prevented from ransacking Tshom-
bd'siresidence only by a
threat from UN officers to
use force against them.
Another source of serious
disturbances is the Congolese
Parliament's decision to create
a new Lualaba province in
western Katanga. Two large
tribes--Tshomb6's Lunda and
their traditional enemies
the Tshokwe--share this area.
Tshomb6 has stated publicly
that he opposes any division
of Katanga. The struggle
over division will be the
more intense because the new
province is supposed to in-
clude the Kolwezi area, where
some two thirds of Katanga's
minerals and three quarters
of its electric power are
produced, and where the Union
Miniere has about a third of
its processing facilities.
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Opposing Greek and Turkish
Cypriot attitudes on the simmer-
ing question of local adminis-
tration of the island's major
towns have further hardened.
Talks on the subject appear to
have been stalled at all levels.
Greek Cypriot suspicions have
been aroused further by a state-
ment from Turkish Foreign Min-
ister Erkin implying that the
United States and Britain sup-
port the Turkish position.
Perhaps in response, Cyp-
riot President Makarios has told
US representatives that he is
considering raising in the UN
the question of revising the
Cypriot constitution and the
London-Zurich agreements which
gave the island its independence.
Makarios is said to feel
that he can rely on bloc and
neutralist--but not Western--
support for the Greek Cypriot
position and to be willing to
tolerate further growth of the
Cyprus Communist Party to ensure
such support. However, while
local Communists have publicly
backed Makarios' policies re-
cently, he probably is aware
that his position would in fact
receive very limited backing in
the UN. He may have raised the
issue at this time only to sound
out the US. It is possible, how-
ever, that the subject may be
raised with the Zurich "guaran-
tor" powers--Britain, Greece,
and Turkey.
The municipalities question
meanwhile has been further com-
plicated by the resignation of
the "neutral" German president
of Cyprus' Supreme Constitutional
Court--which ruled against both
parties on the issue last month
--amid charges and countercharges
alleging bribery and undue pres-
sure on the court by both com-
munities. Vice President Ku-
chuk, the Turkish Cypriot leader,
has issued a highly emotional
statement which Makarios has
answered by questioning Kuchuk's
veracity and good faith.
In such an atmosphere, se-
rious talks between the two
sides are not likely to be re-
sumed in the near future.
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Europe
GATT MEETING STILL LEAVES US-EEC ISSUES UNSETTLED
The eleventh-hour compromise
reached at the GATT ministerial
meeting in Geneva last week averted
a head-on collision between the US
and the Common Market, but left
the future of the US trade expan-
sion program still uncertain. The
hardest bargaining is still ahead.
The near breach stemmed prin-
cipally from US-EEC differences
over ground rules for reduction of
tariffs on industrial items. In
accordance with the Trade Expansion
Act (TEA), the US proposed that the
major industrial countries agree
to cut virtually all such tariffs
by an agreed across-the-board per-
centage--preferably 50 percent.
The EEC, however, wanted to refer
the negotiating formula to a work-
ing party, especially to consider
certain high-bracket US rates--the
so-called disparity problem.
The compromise provides that
tariff negotiations will be based
on a plan for substantial, equal,
reductions except where there are
"significant" disparities in tariff
levels, in which case reductions
will be based on "special rules of
general and automatic application."
The rules are to be worked out by
a special committee, taking into
consideration a statement of the
conference chairman that "signifi-
cant disparities" must be "meaning-
ful in trade terms."
The agreed formula has been
interpreted by US officials as
eliminating further consideration
of the French-backed plan for deal
ing with the disparity problem
through a system of ideal tariff
rates--a plan which would have re-
sulted in a smaller over-all tariff
reduction than envisaged by the
TEA. However, the formula also
admits an exception to the across-
the-board approach, the magnitude
of which remains to be seen. In
rejecting the French plan, the US
has held that trade has continued
to flow despite exceptionally high
rates. The EEC may insist, however,
on a very wide application of the
"special rules" on grounds that
trade would have been greater or
could be expected to be greater if
specific US rates were harmonized
with those of the EEC.
The meeting also failed to
make clear-cut decisions on a num-
ber of other issues. It failed
to endorse an "action program" to
improve the export opportunities
of the less-developed countries,
largely because of reservations
from the EEC countries and asso-
ciated African states wishing to
retain their preferential rela-
tionship with the EEC.
Although the negotiators
agreed that rules should be devised
to further a significant expansion
in agricultural trade, effective
talks on many farm products will
still depend on further elaboration
of the EEC's common agricultural
policy--including agreements on
the community support price for
grains. Rejection of strict pro-
duction controls by the US wheat
growers in last week's referendum
will almost certainly encourage the
protectionist trends, including 25X1
high support prices, which are al-
ready pronounced among Common Mar-
ket farming interests.
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Europe
In the campaigning for
Iceland's general elections on
9 June, economic questions over-
shadow once-popular foreign
policy and defense issues, in-
cluding membership in NATO and
the presence of US forces at
the NATO airbase at Keflavik.
The Conservative and Social
Democratic partners of Prime
Minister Olafur Thors' cabinet
have stressed the success of
the government's economic sta-
bilization program. This pro-
gram, initiated in 1960 over
the bitter opposition of the
largely rural Progressive Party
and the Communist-front Labor
Alliance, was a sharp break
with the policies of previous
governments, which had fostered
almost uninterrupted inflation
during much of the postwar
period. The new program has
unquestionably been a major
factor in stabilizing the econ-
omy and, combined with the
good fish catches of recent
years, has given Iceland a meas-
ure of solid prosperity.
Hampered both by their ina-
bility to capitalize on economic
discontent and by their weakened
grip on labor, the Communists
as well as the Progressives have
sought to exploit such varied
problems as Iceland's future
relationship with the Common
Market and incidents involving
violations by foreign trawlers
of Iceland's fishing limits,
which were extended to 12 miles
in 1958. However, the disclo-
sures earlier Lhis year of Soviet
and other Communist espionage
activities on the island have
put the local Communist Party
on the defensive.
In past elections, the
issues of Iceland's membership
in NATO and the stationing of
American forces at Keflavik
have had wide appeal, particularly
among the more isolated, national-
istic, rural elements. During
the tenure of the Thors govern-
ment, however, relations between
the Icelanders and US base per-
sonnel have improved to such a
degree that, barring unforeseen
incidents, the base is no longer
expected to be a major point of
friction in Iceland's relations
with the US.
The election is not ex-
pected to change markedly the
existing power relationships
in the Althing, where the
Conservatives and the Social
Democrats jointly control
33 of the 60 seats. While
prospects are good that the
two governing parties will
be able to retain their ma-
jority, Prime Minister Thors
has indicated that he does
not completely rule out the
possibility of inviting
the Progressives, with 17
seats, to join the coalition
provided they modify their
attitudes on basic economic
and foreign policy questions.
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Western Hemisphere
Haitian dictator Duvalier's
domestic opponents have been
terrorized to the point where
they regard further action
against him as nearly hopeless
without substantial outside sup-
port. Opposition ringleader
Clement Barbot remains at large
in the Port-au-Prince area, but
his small group appears to be
limiting its efforts to occa-
sional minor bombing and shooting
attacks of little military
significance .
A campaign of arrests and
investigations has followed the
22 May anniversary celebrations
of Duvalier's 1961 "reinaugura-
tion" for another six-year term
as president.
The government continues
to regard domestic and interna-
tional pressures against it as
US inspired. It reportedly is
preparing to accuse the US at
the UN of meddling in Haiti's
internal affairs. Haitian prop-
aganda media feature complaints
that the US is solely to blame
for the country's troubles.
Regime officials have been delib-
erately harassing US authori-
ties--including a deliberate
effort on 26 May to delay depar-
ture of the plane carrying the
US ambassador to Washington.
little warning.
Dominican-Haitian tensions
have eased on the surface, but
new trouble could flare up with
Trouble could also arise
from the Dominican Government's
continuing support of Haitian
exile groups.
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Western Hemisphere
Peronist labor leaders in
Argentina are sponsoring a "Week
of Protest" which began with
demonstrations on 27 May. These
activities are being exploited
by the Communists and could lead
to violence disrupting the
government's plans to hold
elections on schedule on 7 July.
At the same time, however, mod-
erate Peronist leaders continue
preparations for the elections.
The theme of the protest is
"to condemn the dictatorial re-
gime which is ruining the coun-
try, to call for the liberation of
prisoners, and to demand struc-
tural and economic-social changes
for the people's welfare." The
protest is to include surprise
meetings, street demonstrations,
and commercial boycotts, with a
general strike planned for 31
May. The government is still
trying to persuade the General
Confederation of Labor (CGT) to
cancel the strike.
The attitude of many CGT
officials is less extreme than
that of Andres Framini, top
Peronist labor leader who has
called on business and the mid-
dle classes to "join in a popu-
lar revolution or be destroyed."
His views have caused moderate
Peronists to fear increased
Communist penetration of their
splintered movement. Similar
fears may have prompted the
government's decision to outlaw
the Communist Party by decree
on 25 May.
The Communists are not only
supporting the CGT protest but
Known Communist
terrorists are being picked up
as part of the government's
special security measures. The
government is concerned that
revolutionary activity may grow
out of the protest activity.
The Peronists' Popular Union
(UP) was among the 24 parties
filing lists of candidates in
the capital on 24 May. A day
earlier Raul Matera resigned as
president of the Peronist party,
protesting the official ban on
UP candidates for president or
governor and urging abstention
from the elections. The UP and
ex-President Frondizi's UCRI
are still the major members of
the seven-party National and
Popular Front (FNP), formed to
support a joint presidential
candidate.
The announcement on 24 May
that Peron and Frondizi had cho-
sen Vicente Solano Lima, a Popu-
lar Conservative with little
support, to be the FNP candidate,
has renewed frictions in both
their political groups. This
candidacy remains open to fur-
ther negotiation, however. In
the presidential race, only elec-
tors, not candidates, had to be
inscribed by 24 May; any person
meeting the constitutional re-
quirements for president may be
selected by the electoral col-
lege. I
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PERUVIAN INSURGENTS THREATEN ELECTORAL PROCESS
Cuban-trained guerrilla
forces of the Revolutionary Left-
ist Movement (MIR) appear to be
implementing their plan to force
cancellation of Peru's 9 June
elections. Late in April a spokes-
man for the group claimed that MIR
would create disturbances so se-
rious that the governing military
junta would be compelled to sus-
pend constitutional guarantees and
outlaw political rallies and cam-
paigning. MIR intends to exploit
the dissension that would follow
the postponement of elections.
The Peruvian Government claims
that more than 100 Peruvian youths
have been trained in Cuba for guer-
rilla action and other subversive
activities. These youths, accord-
ing to an official communiqud, now
are returning to Peru in small
groups by way of Brazil and Bo-
livia. One such group was appre-
hended near Puerto Maldonado on 14
May. One policeman and one guer-
rilla were killed in the ensuing
gun fight, and six guerrillas were
captured. The rest of the group
fled back toward Bolivia but were
captured ten days later.
The military junta has re-
peated its early announcement that
elections would be held on 9 June,
and its desire to see them through
has become a point of prestige.
However, there is widespread senti-
ment among second-level military
commanders that cancellation
of the elections is preferable
Western Hemisphere
PERU
Site of Guerrilla Clash
to a victory by the leftist
but non-Communist APRA and its
founder-leader, V' tor Ra
Hava de la Torre
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25X1 no., _? , I
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DEVELOPMENTS AT NATO MEETING IN OTTAWA
The 22-24 May NATO minis-
terial meeting in Ottawa, aside
from the usual review of East-
West, relations, featured special
consideration of defense matters,
particularly the establishment
of an inter-Allied nuclear force
(IANF). Although the major dif-
ferences respecting the force
had been largely resolved in
five months of preconference de-
bate, France's efforts to mini-
mize the significance of the IANF
and the UK's attempts to stress
its unique contribution were
still evident at Ottawa. This
is not expected to pose further
problems, however.
Nevertheless, difficulties
may still arise over London's
position that its V-bombers in
the IANF be available to Britain
not only when supreme national
interests are at stake but also
"in conditions of lesser emer-
gency" outside NATO. This stand
could set a precedent for other
force assignments to the IANF,
31 May 63
such as the two French air
squadrons in West Germany.
Although frequently referred
to by individual ministers, the
proposed NATO multilateral nu-
clear force (MLF) was not for-
mally discussed at Ottawa. At
present West Germany is commit-
ted in principle to the MLF, It-
aly's political situation pre-
cludes a firm commitment from
Rome at this time, and the UK
is proceeding very cautiously
(individual military and Labor
Party officials continue to ex-
press negative views).
The Ottawa conferees were
little disposed to undertake an
increased defense effort. On
the contrary, Britain stressed
the "danger" of failing to de-
tect any opportunity for an
East-West detente. The meeting
did, however, authorize further
study of strate and force re-
quirements.
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