WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A004200040001-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 34
• Document Creation Date: December 21, 2016
• Document Release Date: June 19, 2008
• Sequence Number: 1
• Publication Date: September 27, 1963
• Content Type: SUMMARY

27 September 1963
OCI No. 0299/63
Copy No,
7
WEEKLY SUMMARY
OFFICE OF CURRENT INTELLIGENCE
State Dept. review completed.
CENTRAL INTELLIGENCE AGENCY
DIA review
completed.
SECRET 25X1
GROUP I Excluded from automatic
downgrading and declassification
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(Information as of 1200 EDT, 26 September 1963)
CASTRO-STYLE COMMUNIST PARTY STILL DEVELOPING 1
is proceeding with plans
to develop his own Communist-style system over
which he will exercise tight personal control.
SINO-SOVIET RELATIONS
As their bitter exchanges continue, Moscow has
found a potent weapon in Peiping's refusal to sign
the test ban treaty and is underlining Chinese "war
mania." The Chinese are attempting to return the
polemic to the issue of Communist orthodoxy, where
they are on stronger ground than the Soviets.
SOVIET FOREIGN POLICY OUTLOOK
Moscow seems anxious to avoid new crises with the
West while dealing with its Chinese adversaries and
its serious economic problems. Gromyko's UN speech
was the most recent example of Soviet efforts to en-
courage an atmosphere of East-West detente.
25X1
25X1
SHAKE-UP IN CZECHOSLOVAK LEADERSHIP
Stalinist party boss Novotny's changes are only
half measures which are likely to encourage de-
mands for further liberalization, possibly even
for his own ouster.
RUMANIA'S GROWING NATIONALISM
Having defied Moscow in the bloc economic organiza-
tion, Bucharest has apparently been encouraged to
follow up with new expressions of independence.
PEIPING'S INTEREST IN BURMA
Chinese Communist proteges appear to have consid-
erable influence in the Burmese Communist Party
delegation now engaged, along with other insurgent
elements, in peace talks with the Ne Win regime.
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ASIA-AFRICA
SITUATION IN SOUTH VIETNAM
Despite an outward calm, political restiveness
persists, coup talk is again being heard,
25X1
25X1
INDONESIA'S CAMPAIGN AGAINST MALAYSIA
Djakarta Is continuing its military preparations
in Borneo, has broken trade relations with Malay-
sia, and is taking other economic measures against
the new country.
JAPAN TO PROPOSE ORGANIZATION OF WESTERN PACIFIC
Prime Minister Ikeda hopes to sell this plan dur-
ing his current trip in the Southwest Pacific area.
PAKISTAN'S ECONOMIC RELATIONS WITH THE BLOC
Ayub's government has recently concluded trade
agreements with the USSR, Poland, and Albania,
and others are under discussion.
AREA NOTES
Iran and Yemen
13
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EUROPE
Page
NEW FRENCH EFFORTS TOWARD ANTI-GAULLIST ALLIANCES 15
.Amid rumors that De Gaulle will seek re-election
before his term expires in 1165, his opponents are
engaged in new maneuvers--likely to benefit chiefly
the Communists--to form alliances against him.
LABOR GOVERNMENT RECONSTITUTED IN NORWAY
Reconstitution of a minority Labor cabinet on 25
September restores the government to essentially
the situation prevailing before Labor was toppled
by a nonsocialist four-party coalition last month.
OVERTHROW OF DOMINICAN PRESIDENT BOSCH
The coup d'etat removed the first freely elected
regime in over 30 years and does not augur well for
the country's political stability. Foreign reaction
has been overwhelmingly unfavorable.
HAITIAN DICTATOR CRUSHES ANOTHER EXILE RAID
Duvalier, now is a stronger position than at any
time in recent months, may try to consolidate his
power further by another purge of elements in his
regime which he considers unreliable.
INCREASING EXTREMIST AGITATION IN BRAZIL
The extreme left is increasing pressure on the gov-
erment for radical measures, employing the threat
of a general strike. The attitude of War Minister
Jair Ribeiro is considered the key to the outcome
of the present crisis.
THE CHILEAN POLITICAL SITUATION 20
Maneuvering for next year's presidential election
is already under way, and now may be complicated by
some splintering of incumbent President Alessandri's
Democratic Front following last week's cabinet crisis.
VENEZUELAN TERRORISTS CONTINUE THEIR OFFENSIVE
The terrorists for the third week have kept up an
intensified campaign to undermine the Betancourt
government.
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Castro is proceeding to
develop his own Communist-style
system based on a party bureauc-
racy over which he will exercise
tight personal control. The
foundation of this system is to
be the still developing United
Party of the Socialist Revolu-
tion (FURS). Although PURS is
being structured on the pattern
of Communist bloc parties and
espouses Marxism-Leninism as
its ideology, it is clear that
loyalty to Castro is the first
prerequisite for membership. This
is increasingly evident in the
care that has gone into the se-
lection of party cadres and the
speeches that have been devoted
to party activities.
veterans of the
prerevolutionary ban Communist
Party account for only a little
more than three percent of the total
PURS membership. This appears to
be a reasonable estimate, as many
"old" Communists are believed to
have been bypassed for having been
associated with the "sectarian"
activities of Anibal Escalante,
the veteran Cuban Communist leader
purged in March 1962.
During a ceremony of 17 Sep-
tember marking the formation of
a sectional party unit in Ori-
ente Province, the provincial
party organizer stated that the
process of organizing the party
there will,be completed by 10
October. When the organizational
process is completed in all
six provinces, the stage will be
set for a national congress to
mark the formal establishment of
the party. This congress, which
had been promised for sometime
in 1963, may now be put off to
accompany next January's anniver-
sary celebrations.
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The Communist World
Moscow and Peiping are
relentlessly pursuing their
political warfare aimed at
discrediting each other and
winning the allegiance of for-
eign parties. The Chinese and
Soviet parties are each apparently
operating on the assumption that
the conflict will be protracted
and inconclusive. Neither side
seems to believe that the other
will allow itself to be provoked
into some irreparable action
that would precipitate a complete
break in party relations and
possibly even diplomatic ties.
At the same time, each party is
making strenuous efforts to
place itself in the strongest
possible position in the event
they are forced into open rupture.
The Soviet leaders clearly
are confident that Peiping's
refusal to sign the nuclear test
ban treaty has provided them
with a potent weapon in their
drive to discredit and isolate
the Chinese Communists. The long
Soviet Government statement pub-
lished on 21 and 22 September
claimed that the Chinese have
suffered a "serious moral and
political defeat" and that their
rejection of the treaty "amounts
to complete apostasy" from the
world Communist line. The whole
thrust of the statement was to
portray the Chinese leaders as
bloodthirsty warmongers who
are ready to embark on irrespon-
sible adventures. It warned that
Peiping's desire to acquire nu-
clear weapons causes "serious
doubts concerning the foreign
policy aims of China's leaders,"
and charged that they are com-
mitted to a "military solution
of the contradictions between
socialism and capitalism."
The Soviet statement replied
to recent Chinese charges of So-
viet subversive activities in
Sinkiang Province by claiming
that Chinese "servicemen and ci-
vilians" have "systematically vio-
lated" the Soviet frontier since
1960. Moscow for the first time
took notice of Peiping's declared
intention to revise or abrogate
"unjust" territorial settlements
imposed on China by the "impe-
rialists." The statement warned
that "artificial creation" of
territorial disputes would mean
"embarking on a very dangerous
path" and strongly implied that
Moscow will refuse to recognize
Peiping's claims.
In the latest polemical
exchanges both parties have gone
so far as to call into question
each other's readiness to fulfill
commitments under the Sino-So-
viet Treaty of 1950. Peiping re-
peatedly has cast doubt on So-
viet commitments and has accused
the USSR of "flagrant violations"
of the treaty. The Soviet state-
ment charged Peiping with seeking
to justify its desire to acquire
nuclear weapons by denouncing
Moscow as an "undependable ally."
It warned the Chinese against as-
suming that they could enjoy So-
viet nuclear protection and at
the same time continue to at-
tack the USSR. To underscore this
warning, Moscow quoted the Russian
proverb: "Do not foul the well;
you may need its waters."
The Soviet statement con-
cluded with a pro forma appeal
for a cessation of polemics, but
also with a thinly veiled threat
of unspecified retaliatory ac-
tions if Peiping persists in at-
tacking the USSR. It warned that
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the Chinese "must clearly realize
that the most resolute rebuff from
the Soviet party and people awaits
them on this road." Moscow's han-
dling of two recent frontier train
incidents suggests that any future
Soviet reprisals may include a drastic
curtailment or complete termination
of the Chinese training program.in the
USSR. It is possible that the Russians
are even contemplating a complete
break in economic relations along
the lines of Soviet action against
Albania in 1961. There are also
rumors in Moscow of a Soviet deci-
sion to break state relations with
Peiping.
A Pravda article on 19 Septem-
ber, whi'-c=amed the Chinese for
the failure to settle the Sino-
Indian border dispute, constitutes
Moscow's strongest and most exten-
sive criticism to date of Peiping's
policy on this issue. In an ob-
vious attempt to discredit China in
Afro-Asian eyes, Pravda deplored
Peiping's refusal tto "listen to the
voice of reason" as embodied in the
Colombo proposals of December 1962
and accused the Chinese of playing
into the hands of the imperialists.
Peiping has shown its extreme
sensitivity to Moscow's damaging
charges that the Chinese leaders
are "war maniacs"--inadvertently
confirmed by a fumbling Chinese at-
tempt on 1. September to "explain"
Mao's remarks in 1957 concerning the
probable outcome of a nuclear con-
flict--by attempting to return the
polemical warfare to the area in
which they have the better weapons.
In the second major Chinese article
in the projected series replying to
the Soviet party pronouncement of
14 July, People's Daily on 13 Sep-
tember adopte a dis ainful, patron-
izing tone toward Khrushchev and
assumed the role of faithful defender
of Communist orthodoxy against the
heretical Soviet premier.
The article, which was designed
to exploit the disarray and demoral-
ization in foreign parties created
by Khrushchev's attacks on Stalin,
was addressed primarily to hard-line
factions in these parties to whom
Peiping looks for support. It tried
to show that Khrushchev is unworthy
to head the world Communist move-
ment and defined the ideal "head-
quarters of the proletariat" in
terms which fit only the Chinese
Communist Party.
The article struck directly
at Khrushchev's most vulnerable
point by emphasizing that he had
been "particularly active" in carry-
ing out Stalin's suppression of So-
viet "counterrevolutionaries" in
the 1930s. With surpassing inso-
lence, Peiping claimed that even
a majority of people in the USSR
itself disapproved of Khrushchev's
attacks and "cherish" Stalin's
memory.
While the Chinese strain to
gain adherents outside China, there
are indications that the Sino-So-
viet rift, added to domestic eco-
nomic difficulties, is creating
morale problems in China. Accord-
ing to a report of an official in-
quiry into popular attitudes in a
county of Kwangtung Province, many
people are alarmed by the loss of
Soviet support for industrialization
and are pessimistic about the fu-
ture. The US consul general in
Hong Kong comments that this and
another recent report show that
Peiping's challenge to Moscow--
while appealing to Chinese xeno-
phobia--has also generated appre-
hension over the regime's motives
and possibly deepened doubts about
its present course.
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The dominant factor shap-
ing Moscow's present foreign
policy outlook appears to be
its desire to avoid new crisis
situations with the West while
dealing with the increasingly
bitter and damaging struggle
with the Chinese Communists for
leadership of the Communist move-
ment. The serious economic
problems facing the Soviet
leaders, highlighted by the
recent large-scale grain pur-
chases in the West, probably
have also strengthened their
interest in a general improve-
ment in Soviet-Western relations.
The moderate and "states-
manlike" tone of Foreign
Minister Gromyko's speech to
the UN General Assembly on 19
September was the most recent
example of Soviet efforts to
encourage a detente atmosphere.
He urged all governments to use
the favorable situation. created.
by the test ban treaty to agree
on further measures to ease
tension and he carefully re-
frained from direct criticisms
of US policy in such sensitive
areas as Cuba and Southeast
Asia. He gave only perfunctory
attention to'the German and Ber-
lin problems and repeated Khru-
shchev's theme that, from the
bloc viewpoint, the Berlin Wall
has reduced the urgency of a
German peace treaty.
In keeping with long-
standing Soviet "detente tac-
tics," Gromyko's speech focused
primarily on disarmament. His
proposals for a heads-of-
government meeting of the 18-
nation disarmament committee
during the first half of 1964
and for a US-Soviet treaty
banning nuclear weapons in outer
space were intended to demonstrate
the USSR's constructive attitude.
He also sought to underline
Soviet flexibility by offering
a further "concession" in Mos-
cow's general disarmament plan
which would permit the US and
the USSR to retain a limited
number of missiles and nuclear
weapons until the end of the
last stage of the disarmament
process.
The Soviet leaders appear
to see litttle early prospect
for further agreements com-
parable to the test ban in
importance. They are under
no pressure, and they remain
unwilling to make concessions
as the price for agreement on
major issues such as Berlin
and Germany. They probably
believe, moreover, that West
German and French opposition
will preclude agreement on such
measures as a NATO - Warsaw Pact
nonaggression treaty, a reduc-
tion of foreign forces in the
two Germanys, and a nuclear-free
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1"W k%=010
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The Communist World
zone in Central Europe. Khru-
shchev, however, probably
hopes to draw the US and its
allies into a protracted period
of negotiation on partial disarm-
ament and European security
matters. He would calculate
that such talks would intensify
differences among the Western
allies and increase the reluc-
tance of some NATO members to
proceed. further with a multi-
lateral NATO nuclear force.
While the Russians see no
present opportunities for advanc-
ing their aims on major European
questions, they apparently
attach considerable importance
to further bilateral agreements
with the US as a means of keep-
ing alive the momentum and
atmosphere created by the test
ban treaty. In addition to
Soviet interest in agreements
banning nuclear weapons in
outer space and establishing
legal principles for the peace-
ful uses of space, Moscow has
indicated a desire to conclude
a consular convention and a
civil air transport agreement.
Although the USSR has
termed President Kennedy's
UN address an "encouraging"
and "sober" approach to world
problems, it has not yet re-
acted publicly to his pro-
posal for a joint manned lunar
landing project.
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`'~ SECRET The Communist World
SHAKE-UP IN CZECHOSLOVAK LEADERSHIP
The shake-up in the Czechoslo-
vak regime on 21 September removed
a number of party boss Novotny's
Stalinist colleagues from high po-
sitions and extended the influence
of a new and somewhat more liberal
party grouping. However, while
yielding to pressures for political
liberalization and economic ration-
alization, Novotny has placed mem-
bers of his own clique in positions
where they can watch the new ap-
pointees. This effort to ensure
his own position will probably suc-
ceed temporarily.
The changes which Novotny has
made are nevertheless unlikely to
satisfy his severest critics. They
are, moreover, likely to whet ap-
petites and to concentrate further
criticism directly on Novotny, who
is as guilty of "Stalinist" crimes
as those officials recently removed.
Premier Siroky, two hard-line
deputy premiers, and four ministers
were dropped. Two new ministers
without portfolio--both Slovaks--
were added, and four new central
committee commissions--three deal-
ing with economic matters, the other
with ideology--were created.
Josef Lenart, a member of the
Czechoslovak party presidium since
December 1962, was made premier.
With the appointment of Lenart, a
40-year-old Slovak who is un-
tainted by Stalinism, Novotny evi-
dently hopes to silence his out-
spoken Slovak critics.
Three other regime officials
elevated to new positions of prom-
inence--Cestmir Cisar., Vladimir
Koucky, and Drahomir Kolder--are
reportedly members of a more lib-
eral central committee group hos-
tile to Novotny. Koucky--an old-
time party secretary responsible
for relations with foreign Commu-
nist parties and probably also for
domestic cultural matters--has been
appointed to head the central com-
mittee's new ideological commission.
Party secretary Kolder is to head
the party's new commission on gen-
eral economic problems. Cisar was
appointed minister of education and
culture, a move which will hearten
those intellectuals, authors, and
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Joromir Dolotsky
Zdenek Fierlinger
Jiri Hendrych
Alexander Dubcek
Antonin Kapek
ILudmita Ja ovcoval
PERSONNEL CHANGES CZECHOSLOVAK COMMUNIST PARTY
20 September 1963
PRESIDIUM
Members
NEW
Jaromir Dolansky
Zdenek Fierlinger
Jiri Hendrych
Alexander Dubcek
Antonin Novotny
Otakar Simunek
SECRETARIAT
Secreiories
Antonin Kopek
Michal Saboicik
Martin Vaculik
Jiri Hendrych
(head of new party commission on
standard of living)
(head of new party commission on
agriculture)
(head of new party commission on
economy)
(head of new party commission on
ideology)
Position
President
Premier
Deputy Premier
Ministers without
Portfolio
CZECHOSLOVAK GOVERNMENT CHANGES
20 September 1963
Joromir Do nsk wt
YLGXW
Frantisek Krojcir
Jon Piller
NEW
Antonin Novotny
Jozef Lenart
Oldrich Cernik
Frantisek Krajcir
Jan Piller
Ministers
Agriculture, Forestry Vratislav Krutina
& Water Economy
Education & Culture [Frntisek Kahuda I
Finance
Transport
Food
Fuel
F tfse
rartk Vakac,
Josef Krasner
Antonin Novotny
Antonin Novotny
Minister-Chairman
Jiri Hendrych
Jiri Hendrych
State Planning
Commission
State Commission for
Antonin Krcek
Antonin Krcek
Development and
Frantisek Zupka
Frantisek Zupka
Coordination of
NOTE: CENTRAL COMMITTEE
Dropped: Julius Duris, ex-Minister of Finance
Promoted from candidate to full member: Michal Sabolcik
Jaranir Dola
Cestmir Cisar
Richard Dvorak
Alois Indra
Vratislav Krutina
Josef Odvarka
NOTE: Incumbents of remaining 13 ministerial posts and I post of
minister-chairman of a government commission were retained.
Chairman State Planning
Commission replacing
Alois India
Chairman State Comm.
for Investment Construction
Chairman Slovak National
Council replacing Jozef Lenart
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LENART
journalists who have been press-
ing for change. He was report-
edly responsible for the publi-
cation in June of an open attack
on Siroky.
Cisar's predecessor has
been retained as deputy, how-
ever, and Cisar was removed
from the party secretariat. As
KOUCKY
a further counterbalance to the
influence of these three, ousted
Deputy Premier Dolansky was
appointed head of the new party
commission on living standards.
Also influential party presidium
member Jiri Hendrych, long a
Novotny supporter, is chairman
of the new agriculture commis-
sion.
The success of Novotny's
tactics will depend in consider-
able measure on the degree of
backing he receives from
Hendrych, who has long been in
line as Novotny's successor,
is sprinkled with his opponents.
depend on how well and quickly
the country's economy--whose
success until 1960-61 shored
up his political position in
the eyes -r Moscow--responds to
the new Lcp management, which
I lEN DRYCH
and who aided the preliminary
de-Stalinization moves last
January. Novotny's chances also
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Rumania has apparently been
sufficiently encouraged by its suc-
cessful defiance of Moscow over
certain bloc economic integration
policies to follow up with further
expressions of independence. Bu-
charest now seems to be in a lead-
ing position among the East European
countries in asserting a right to
place its national interests ahead
of those of the USSR and other mem-
bers of the Council for Mutual Eco-
nomic Ass istance (CEMA). This has been
reflected in recent weeks in Bucha-
rest's noncommittal public stance
in the Sino-Soviet dispute and in
its adoption of policies appealing
to the nationalistic sentiments of
the Rumanian population.
Rumania has for many years
sought to avoid embroilment in con-
troversial bloc affairs, and its
present relative silence on the
Sino-Soviet polemics is in increas-
ingly sharp contrast with the rest
of the Soviet bloc. The regime
last criticized the Chinese by name
on 7 August, and then more in a
tone of sorrow than anger. By not
opposing the Chinese line in the
same terms as Moscow and the rest
of Eastern Europe, Bucharest main-
tains a constant threat of turning
from support of Moscow in the event
that the USSR should again attempt
to change Bucharest's economic poli-
cies.
The regime's effort to lessen
Soviet influence in the country
has direct appeal to nationalistic
sentiment. During Rumania's na-
tional holiday ceremonies on 23
August, pictures of Khrushchev were
not displayed, the usual slogans
extolling Rumanian-Soviet friend-
ship were missing, and the normal
eulogy on the World War II role of
the Soviet Army in the liberation
of Rumania from the Nazis was practi-
cally ignored. More recently the
unpopular mandatory Russian-language
courses for grades 5 through 11 have
been made optional, the Maxim Gorki
Institute of Russian Language and
Literature at Bucharest University
has been abolished, and a Rumanian
Language and Literature Department
created.
Rumania continues to defend
its independent economic policies,
and to view cooperation with CEMA
essentially in terms of serving
its own national interests. On
23 August, a Rumanian economic
journal criticized an East German
article which had said that some
bloc states should limit themselves
to "passive industrialization"--
a critical allusion to Bucharest's
insistence on developing an indus-
trial economy. Another article on
30 August sharply defended Rumania's
policy of continuing to develop an
all-round industrial base.
Bucharest's attempts to mani-
fest greater independence prob-
ably stem in part from fear that
the settlement of its differences
with CEMA reached at last July's
meeting was only temporary. Mind-
ful of this, the regime is ob-
viously trying to maintain itself
in a strong position--both do-
mestically and to exploit Moscow's
bitter battle with the Chinese
--and thus be able to stand up
to future pressures from Mos-
cow.
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Peiping's long-term efforts
to increase its influence in
Burma took a new turn this
month, when Burmese ruler Ne
Win began preliminary peace
talks with Burmese Communist
Party (BCP) and other insurgent
elements.
When Ne Win first proposed
negotiations with insurgent
groups, the Chinese were quick
to "cooperate" with him by
arranging for 29 BCP leaders
who have been living in China
for the past decade to take
part. Thus, the Chinese now
have well-indoctrinated Burmese
protegds bidding for leadership
of a Communist party which may
soon be legal and may even have
a small voice in the government.
In the preliminary peace
talks with Ne Win, four of the
eight members of the BCP dele-
gation were returnees from
Peiping--an indication that
they have regained considerable
influence in the indigenous party.
Statements made at a press con-
ference by the leader of the
delegation openly supported
Peiping in the Sino-Soviet dis-
pute.
The recent recall of the
Chinese Communist envoy in
Rangoon and the consul general
in Mandalay suggests that the
Chinese are revamping their
diplomatic front in hopes of
taking advantage of a new era.
The new ambassador, Keng Piao,
was a vice minister of foreign
affairs; both his high-level
background and his reputation
as an intelligent, aggressive
party careerist contrast sharply
with those of his less active
predecessor.
Since 1959 China has pursued
a policy of determined friend-
ship toward Burma and dropped
its bullying hard line against
Ne Win, which was counterpro-
ductive. In 1960 and 1961 a
boundary agreement, cooperation
with Burma against Chinese
Nationalist irregulars, and an
$84-million trade agreement
followed the establishment of
this policy. Since then, Pei-
ping has maintained its friendly
and reasonable facade by re-
sponding moderately even when
Burma stiffened its naturaliza-
tion policy, nationalized two
Chinese Communist banks, and
issued a statement in favor of
the Moscow test ban treaty.
Therefore, although the
Ne Win - BCP talks appear likely
to drag on for some time and
produce few major government con-
cessions, Peiping will probably
continue to be most circumspect
in dealing with Rangoon. The
Chinese have no desire to up-
set by overeager action their
efforts in one of the few
countries in which they may be
making progress.
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Political restiveness per-
sists in South Vietnam despite
outward appearances of a return
to near-normal conditions and
of firm control by the Diem
government.
How-
ever, the capabilities of anti-
regime' groups are open to ques-
tion.
The Viet Cong are sustain-
ing their high level of activity
in the delta area, although the
scale of attacks apparently has
decreased during the past week.
The delta provinces of Kien
Hoa, Vinh Binh, and Ba Xuyen
SECRET
27 Sept 63 CURRENT INTELLIGENCE WEEKLY SUMMARY
have been the primary targets
of Viet Cong attacks, partic-
ularly self-defense corps out-
posts and communication routes.
Some elements of the newly
arrived infantry division that
will be permanently based in
the delta have been sent to
Vinh Binh.
While the current step-up
in Viet Cong activity may be
designed to exploit the govern-
ment's current political diffi-
culties, a slow increase has
been discernible for four months.
Communist forces may sustain a
higher rate of activity through-
out the approaching dry season
than they did last fall.
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INDONESIA'S CAMPAIGN AGAINST MALAYSIA
Indonesia is continuing
its military preparations in
the Borneo area, while stepping
up its confrontation policy
against Malaysia in the economic
field.
On 25 September, Djakarta
announced that it has sent elite
forces--including commando units
--to the Sarawak border area.
Defense Minister Nasution stated
that these troops are prepared
to train and aid northern Borneo
rebels.
on 25 September that the first
serious border incident in Sara-
wak's First Divison area in
more than a month occurred the
previous day when four mortar
shells were fired into a Sarawak
village.
Malaysia, for its part,
urgently recalled its chief of
staff, Mai Gen. Osman, from a
tour of Pakistan, and announced
it was sending two more battal-
ions to Sarawak and Sabah
(North Borneo) as part of its
"preparedness" policy. Osman
is to go to Sarawak, where Ma-
laysian troops will now number
about 2,000.
27 Sept 63
Indonesia's break in trade
relations with Malaysia on 21
September has been followed by
a number of specific actions
aimed at giving some teeth to
the economic war. Oil companies
operating in Indonesia are
forbidden to. ship oil to Malay-
sia, and Indonesian tin concen-
trates--formerly smelted in
Penang, Malaya--will be shipped
directly to Europe in the
future. On 24 September, the
Indonesian Government denied
landing rights to all interna-
tional airline flights with
stops in Malaysia and next day
temporarily cut all telegraphic
and telephone links with the
new nation.
Several high-ranking Indo-
nesian officials have expressed
concern over the effect of the
Malaysian trade break on In-
donesia's economy, and some
efforts have already been
made to develop new trade pat-
terns. On 23 September an
agreement was signed with Com-
munist China for the sale of
2,000 long tons of rubber start-
ing this month. Two days later,
Indonesia and the Philippines
signed a memorandum implement-
ing trade agreements concluded
last May. In a joint communi-
qud issued after the signing,
the Djakarta government ex-
pressed its willingness to
shift its traditional trade
from Malaysia to the Philippines.
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In view of the great diffi-
culties involved in reorientat-
ing trade from Singapore and
the attendant serious effects
on the Indonesian economy,-
Sukarno may not be willing or
able to hold the line against
all economic relations with
Malaysia.
Meanwhile, both Thailand
and Japan have separately of-
fered to mediate the Malaysian
situation. Australia and New
Zealand have publicly given
pledges of military assistance
to help defend the territorial
integrity and political inde-
pendence of Malaysia.
Prime Minister Ikeda of
Japan is using the good-willtour
on which he embarked on 23 Sep-
tember as a major effort to fur-
ther Japan's influence in the
Southwest Pacific area. Founda-
tions are already laid for the
trip to fulfill its original
purpose of stimulating expansion
of Japanese trade, especially
with Australia.
On the eve of his trip,
Ikeda publicly announced Japan's
interest in playing a peace-
maker'role in the Malaysia dis-
pute. Privately, he told Ambas-
sador Reischauer that he planned
specifically to propose a West-
ern Pacific organization to the
leaders of the countries he is
visiting: the Philippines, In-
donesia, Australia, and New
Zealand, where his tour concludes
about 4 October. He hopes sub-
sequently to announce a prelim-
inary meeting in Tokyo for next
year of representatives of Japan
and those four powers--composing
what he has called "the colossal
archipelago" of the South Seas.
The purpose of the gathering
would be to discuss a grouping of
these four together with Japan,
Malaysia, Thailand, and possibly
others.
The Japanese foreign
minister told the US that in
his talks with Presidents Maca-
pagal of the Philippines and
Sukarno of Indonesia, Ikeda
planned to emphasize the im-
portance of good mutual rela-
tions among the peoples of
the Malay archipelago. He will
reportedly offer Japanese assist-
ance generally in settling
regional differences.
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PAKISTAN'S ECONOMIC RELATIONS WITH THE BLOC
The economic agreements
which Pakistan is concluding
with several Communist coun-
tries seem primarily intended
to underline Pakistan's "inde-
pendence" of its Western allies
rather than to signal a substan-
tial shift in its economic rela-
tions. Repeated publicity on
each step in negotiations with
Communist representatives does,
however, encourage further de-
mands by Pakistani neutralists
for disengagement from free world
alliances.
Last year, when faced with
the likelihood that the United
Kingdom would join the Common
Market, Pakistan began to look
for new markets, including bloc
countries with which it had
traded only sporadically in the
past. Although the failure of
Britain's bid reduced the need
to diversify Pakistani trade,
Rawalpindi continued to publi-
cize its desire for expanded
economic relations with the bloc
as part of its reaction to US
and UK military assistance to
India.
In August and September,
Pakistan concluded barter trade
agreements with the USSR, Poland,
and, most recently, Albania, and
it has held barter discussions
SECRET
27 Sept 63 CURRENT INTELLIGENCE WEEKLY SUMMARY
with Communist China and Czecho-
slovakia. These agreements call
for the export mainly of raw
jute, cotton, wool, hides, and
skins, in return for cement,
other building materials, and
petroleum products.
There will probably be only
a limited expansion in the bloc's
5-percent share of Pakistan's
world trade. Although the Com-
munist countries are chiefly in-
terested in raw jute, Pakistan
is not likely to divert large
quantities of its best hard-
currency earner from Western
markets. Cuba has reportedly
arranged to purchase 15,000
bales of manufactured jute, in
the form of sugar bags, from
Pakistan, in addition to 60,000
bales from India.
Additional propaganda play
will probably be given to the
expansion of Pakistan's civil
air ties with the Communists.
Rawalpindi seems eager to imple-
ment its well-publicized civil
air agreement with Communist
China, but the many practical
arrangements which must be made
seem likely to cause repeated
postponements. The USSR has
also sent a civil air negotiation
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Iran: The carefully man-
aged 17 September elections to
the Iranian Parliament (Majlis)
carried the government one step
further in the Shah's aim of
remaking Iranian society, but
hostile elements are prepared
to continue their opposition.
Although the government's han-
dling of the elections may have
been somewhat less restrictive
than on previous occasions, its
devices to prevent the election
of any opposition candidate will
leave it open to continuing
criticism.
One of the first steps the
Majlis will be asked to approve
is the creation of a new minis-
try that would bring vast reli-
gious properties under govern-
ment control and thus end the
economic independence of the
Conservative religious leaders
(mullahs) and lessen their polit-
ical power. Both the mullahs
and the radical Freedom Move-
ment may turn their frustrations
into extremist action.
The new Majlis draws heav-
ily on professional people in
keeping with the government's
attempt to switch the base of
its support from the landlord
and merchant groups. While the
new deputies will follow the
Shah's lead for the present,
independent leadership trouble-
some to the Shah could emerge
in the Majlis over the longer
run. In any event, the US Em-
bassy in Tehran believes that
the re-establishment of the
Majlis after a two-year lapse
should have a healthy effect
on business confidence both in-
side and outside the country.
Yemen: There is mounting
evidence that a drastic change
in the leadership of the re-
publican regime in Yemen may
be imminent. A recent confer-
ence attended by tribal, reli-
gious, and other Yemeni leaders
called for a new council of
ministers,
led by a
strong prime
minister.
President
Sallal
apparently
would be
retained,
but only as
a figurehead chief
of state.
The conference also re-
solved to create a tribal army
and to seek the withdrawal of
Egyptian troops from noncombat
areas. The delegates did not
express opposition to the re-
public itself or profess any
devotion to the old religious
imamate which the royalists
wish to restore.
the Egyptians also may believe
that the present regime is un-
workable, and they may be pre-
paring to help reconstruct it
on a broader basis. Egyptian
Field Marshal Amer and another
of Nasir's top aides, Anwar
Sadat, were sent to Yemen on
25 September, possibly to take
part in such an effort.
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27 Sept 63 CURRENT INTELLIGENCE WEEKLY SUMMARY
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NEW FRENCH EFFORTS TOWARD ANTI-GAULLIST ALLIANCES
Reports that De Gaulle
plans to seek re-election be-
fore his present term expires
in 1965, and recent opinion
polls showing a decline in his
popularity, have led to new ef-
forts by anti-Gaullists to form
alliances against him. The
chief beneficiary of these ma-
neuvers is likely to be the Com-
munist Party (PCF).
The latest authoritative
poll shows the percentage of
Frenchmen satisfied with De
Gaulle's performance as presi-
dent down from 50 in June to 44
in late August, and the number
of undecided respondents up from
13 to 22 percent. The greatest
decline in De Gaulle's popular-
ity occurred among farmers.
On 15 Spetember, the oppo-
sition held the first of a se-
ries of "banquets of a thousand"
designed to promote the unity
of all anti-Gaullists behind a
single presidential candidate.
The banquet was attended by lo-
cal office-holders representing
parties ranging from the PCF to
parties on the right. The non-
Communist left furnished most
of the big-name speakers. Nota-
ble for its presence was a dele-
gation of the Socialist party
(SFIO), which last spring refused
to participate in a "study group"
aimed at achieving much the
same goal but which included
more center and rightist figures.
The success of the "ban-
quets," as with any endeavor to
formulate joint opposition to
De Gaulle, depends on a solu-
tion of the perennial problem
of relations between the PCF
and the non-Communist left--
particularly the SFIO. There
has been no letup in the PCF's
campaign to publicize the simi-
larity of its own and SFIO op-
position and to encourage joint
activities.
SFIO leader Guy Mollet,
meanwhile, has continued to
swing his party toward the left.
The SFIO congress last May sought
to distinguish between a politi-
cal accord with the PCF and a
"defensive tactic against a de-
clared peril." Mollet further
obscured this distinction when
he spoke hopefully of "worker
unity" in France during a 16
September radio interview.
In early November Mollet
will lead an SFIO delegation to
Moscow at the invitation of the
Soviet Communist Party. Rightly
or not, the visit will be inter-
preted by many French voters as
evidence that the PCF and SFIO
are drawing closer together.
Despite hints dropped dur-
ing his current provincial tour
that he will run again, De Gaulle
continues to keep his own coun-
sel as to his ultimate inten-
tions. Recent reports that he
will seek re-election next spring
may have been floated by leaders
of the Gaullist Union for the
New Republic (UNR) in an attempt
to bring into the open political
alliances which will appear to
the electorate to be Communist-
dominated. Such a strategy would
be consistent with continuing
UNR efforts to create the impres-
the Communists.
sion of a black-and-white elec-
toral choice between itself and
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V411111,11 mw~
NORWEGIAN PARLIAMENT
LIBERALS
14
LABOR PARTY
74
CHRISTIAN
PEOPLE'S PARTY
CENTER PARTY
(AGRARIAN 16
150
SEATS
CONSERVATIVES
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The reconstitution of a
minority Labor cabinet on 25
September restores the Norwegian
Government to essentially the
same situation prevailing before
Labor was toppled by a coalition
of the nonsocialist parties
late last month. The new govern-
ment will again be headed by the
veteran Labor Party chairman,
Einar Gerhardsen, who has held
the post of prime minister for
most of the postwar period.
The foreign affairs and defense
ministries will also be beaded
by the previous Labor incumbents,
Halyard Lange and Gudmund Harlem.
The principal cabinet
changes have been made in those
posts responsible for administer-
ing domestic economic matters.
The new ministers in these posts
seem to be identified with Labor's
left wing and may reflect the
more aggressively socialist pro-
gram Gerhardsen has said he in-
tends to pursue. In addition
to expanding the already exten-
sive social welfare programs,
Gerhardsen has proposed that
the government increase the
number of publicly owned in-
dustries and utilities. He
also favors tightening govern-
ment control over banks and
other credit institutions.
The victory Labor won in
the local elections of 23 Sep-
tember is already being inter-
preted by party leaders as a
mandate from the electorate to
implement these proposals. The
opposition parties, however,
charge that the leftward turn
in Labor's domestic economic
program represents the price
Labor paid to secure the sup-
port of the extreme leftist
splinter Socialist People's
Party (SPP) in bringing down
Conservative Prime Minister
Lyng's short-lived government.
An immediate problem con-
fronting Gerhardsen is the need
to restore some measure of co-
operation with the four parties
of the outgoing' government.
These parties deeply resent
Labor's actions in toppling
Norway's first nonsocialist
government in 28 years without
giving it a reasonable period
to demonstrate its ability to
govern. Consequently, Labor
will face a bitter fight in
parliament over its domestic
economic program. On basic
foreign policy and defense
questions, however, there is a
wide area of agreement among
all the non-Communist parties,
and these matters will not be
affected by the tug of war
between Labor and its opposition.
Both Labor and the non-
socialist parties are expected
to support a constitutional
amendment that would permit the
dissolution of parliament and
the calling of new elections
before their regularly scheduled
date in 1965. Neither group
is satisfied with the present
parliamentary line-up, in which
each of the two major blocs
controls 74 seats, leaving the
balance of power in the hands
of the two SPP deputies.
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SECRET Western Hemisphere
OVERTHROW OF DOMINICAN PRESIDENT BOSCH
The chief instigator of the
25 September coup d'etat that over-
threw Dominican President Juan
Bosch was army Colonel Elias Wes-
sin y Wessin. He was successful
largely because of the support he
got from air force commander Gen-
eral Atila Luna.
Wessin previously has been
described by US military officials
as a tough and virulent anti-Com-
munist, backed by a group of the
more reactionary young officers.
Bosch's demand early on the morn-
ing of the 25th that Wessin be re-
moved for antigovernment plotting
reportedly led to the coup.
The degree of civilian partic-
ipation is unclear. However, would-
be strong men Antonio Imbert and
Luis Amiama--only survivors of ex-
dictator Rafael Trujillo's assas-
sins-signed the initial military
communique. Also, police chief
Belisario Peguero, an Imbert crony,
apparently collaborated with the
plotters.
The military forces, meanwhile,
are continuing their efforts to
form a provisional government com-
posed of civilians. They are con-
ferring amid rumors that Bosch's
followers will attempt to organize
a general strike or other protest
action. Representatives or right-
ist political parties reportedly
were still meeting at the National
Palace in Santo Domingo 24 hours
after the coup and had. not reached
agreement on who should be included
in the new government.
The end of Bosch's seven-month-
old government--the first freely
elected democratic regime in the
country in over 30 years--does not
augur well for Dominican political
stability. There is bound to be
haggling and cliquishness among
the new rulers, particularly on
the part of opportunistic politi-
cians who are cooperating with the
military and were involved in pre-
coup plotting. None of them com-
mands any sizable popular support,
and the extreme rightist policies
adopted. by the armed forces will
not find favor among most Domini-
cans.
The police have cracked down
on Castro-Communist parties--which
were outlawed by the military im-
mediately upon ousting Bosch. The
arrest of numerous extreme leftist
leaders may deter significant anti-
military action by their followers
for the time being. However, the
new regime's repression of the left
has also removed the only moderate
leftist parties from the political
scene. This may eventually redound
in favor of extreme leftists.
Except in Haiti, foreign reac-
tion to the Dominican coup has been
overwhelmingly unfavorable. A
Radio Moscow commentator intimated
that US military elements had been
encouraging such action since mid-
summer. The broadcast concluded
that the Dominican military "with
the blessing of their American
bosses" were attempting to force
on the Dominican people a new dic-
tatorship and to "resurrect the
the gloomy years of the Trujillo
rule."
Latin American reaction has
been especially sharp. Venezuela
and. Costa Rica have suspended dip-
lomatic relations, and several
other countries will follow suit.
Venezuelan President Betancourt,
a close friend of Bosch, was visi-
bly shaken by the potential
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SECRET
repercussions of the Dominican events
on his own relationship with the
Venezuelan military, who long have
been displeased with Betancourt's
failure to take strong action in
the face of widespread Communist
and pro-Communist terrorism.
In New York, Latin American
delegates to the UN General Assem-
bly appear upset by the Dominican
coup. Venezuelan Foreign Minister
Falcon Briceno, on instructions
from Betancourt, met with Secretary
Rusk to discuss the convening of
a meeting of OAS foreign ministers.
This is in line with Falcon's and
Betancourt's belief that it is high
time for a hemispheric discussion
of the threat posed by military
coups.
Western Hemisphere
The Costa Rican, Salvadoran,
and Honduran UN delegates have also
voiced their deep concern over Do-
minican developments. The Cuban
representation in New York, however,
is said to be "jubilant" about
Bosch's fall.
US Charge Curtis in Port-au-
Prince reports that Haitian Foreign
Minister Chalmers, probably speaking
without instructions from President
Duvalier, intimated that the military
take-over in the Dominican Republic
might facilitate a solution of Haiti's
problems with that country on a bi-
lateral basis without further OAS in-
volvement. He said nothing,however,
about Haiti's reported intention to
seek UN action on its charges of Do-
minican complicity in recent exile
The threat posed to the Du-
valier regime in Haiti by General
Cantave's exile forces seems vir-
tually eliminated following their
decisive defeat on 23 September.
A few rebels may remain in the
Ounaminthe area An northeastern Haiti,
scene of the recent raid, but they
do not constitute any threat to the
government.
While it is too early to as-
sess how badly the exiles have been
shaken by their latest setback, it is
unlikely that they will try any more
raids in the near future. Their
prospects over the longer run appear
to be little better unless they can
somehow pull together a larger,
better trained, and disciplined force.
According to the US Embassy in
Port-au-Prince, the immediate result
of the rebel defeat is that Duvalier
now is in a stronger position than
at any time in recent months.
Since April, the dictator has broken
27 Sept 63
up an extensive military plot, re-
pelled three raids by exiles, and
survived a period of severe eco-
nomic and fiscal hardship. Obliv-
ious to foreign censure, he has
relentlessly pressed his ruthless
campaign to suppress all internal
opposition to his rule. And he
now has the satisfaction of the
overthrow of Juan Bosch, his arch-
enemy in the neighboring Dominican
Republic.
With all these developments
adding to Duvalier's confidence,
there probably is worse to come.
During a political rally last week,
Duvalier pointedly remarked that
his revolution has already devoured
some of its undisciplined children
and would continue to do so. De-
termined to consolidate his power
further, he may well begin an-
other purge of elements in his
regime he considers unreliable.
Significantly, the Legislative
Assembly recently declared Haiti
a one-party state
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SEGII I T
Brazil's extreme left, hop-
ing to exploit continued unset-
tled conditions, is increasing
pressure on President Goulart
and Congress for actions favor-
able to it. On 23 September the
Communist-dominated General Workers
Command (CGT) and its allies
issued a "manifesto" demanding
the immediate adoption of a
sweeping reform program by the
government which would require
drastic constitutional changes.
These groups have been threat-
ening for some time to instigate
a general strike if their demands
are not met. To lend emphasis to
the threat, the CGT called a
bank workers'strike on 24 Sep-
tember.
An immediate goal of the
extreme left appears to be the
removal of General Peri Bevilacqua
from command of the Second Army
in Sao Paulo. Bevilacqua has
publicly proclaimed his opposition
to politically motivated strikes,
and has gone so far as to publicly
denounce the CGT and other leftist
labor groups as "enemies of democ-
racy and traitors."
The US army attache reports
information from War Ministry
sources that Bevilacqua will in-
deed be removed soon. If this
does occur, it could precipitate
a strong reaction by conservative
elements.
Outwardly, Goulart has main-
tained an equivocal position.
However, he may actually be co-
operating with the leftists and
even encouraging them to press
their case.
The key figure at the moment
seems to be Minister of War Jair
Ribeiro, who appears to be torn
between conflicting pressures. On
the one hand he has sworn to up-
hold the constitutional government
and remain out of politics, while
on the other he is being pushed
by the military to seize the ini-
tiative and crack down on the
leftists.
Ribeiro has a reputation as
a man without deep personal con-
victions who, while not pro-Com-
munist, finds it expedient to
cooperate with leftists. He did,
however, act firmly to put down
the leftist sergeants' outbreak
in Brasilia in early September
and endorsed the use of troops
against strikers in Santos.
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27 Sept 63 CURRENT INTELLIGENCE WEEKLY SUMMARY Page 19
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THE CHILEAN POLITICAL SITUATION
Although Chile's presi-
dential election is still a year
away, intense maneuvering is
already under way. The political
scene is still highly fluid,
however, and likely to become
more so.
There are three major can-
didates in the field: Radical
Senator Julio Duran, representing
the government-oriented Demo-
cratic Front, Senator Eduardo
Frei of the Christian Democrats,
and Socialist Senator Salvador
Allende, who heads the ticket of
the Communist-supported Popular
Action Front. It is presently
impossible to gauge their re-
spective strengths accurately
because of numerous current re-
ports and rumors of shifting
loyalties. The picture is also
clouded by the candidacy of a
fourth individual, independent
Jorge Prat, and by uncertainty
as to the intentions of incum-
bent President Jorge Alessandri,
for whom a re-election movement
is under way.
Alessandri has denied am-
bitions for a second term, and
Duran came away from a recent
interview with him convinced
that he would not run again.
However, persistent pressure
from his supporters might weaken
Alessandri's resolve. The Presi-
dent, however, has done little
on Duran's behalf, but has in-
stead praised Prat, and this has
led to speculation that Alessan-
dri hopes that Prat will under-
mine Duran's candidacy. In this
case the President would appear
as the only rightist capable of
winning the elections.
For Alessandri to succeed
himself, the constitution would
have to be amended. A simple
majority of the congress may
do this,. but the process is cum-
bersome and would require a
minimum of four months. Should
congress reject an amendment,
Alessandri could submit the
issue to a national plebiscite.
Meanwhile, the recent cabi-
net crisis, brought on by dis-
agreement over settlement of
a labor dispute, nay affect the
presidential race. As matters
stand, the coalition of Liberals,
Conservatives, and Radicals
(who make up the Democratic
Front) has been broken at the
ministerial level. The Radicals
have withdrawn from the govern-
ment and adopted an independent
position. The Conservatives also
left the cabinet, but will con-
tinue to support the adminis-
tration.
As a consequence, Alessandri
on 25 September appointed a com-
pletely new government. This
government, nonpolitical in
character, is composed of vet-
eran technicians and will be
only loosely associated with
the Democratic Front.
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27 Sept 63 CURRENT INTELLIGENCE WEEKLY SUMMARY
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Arson at US-owne-&'Niafr'o-C`,o1
Mayer office.
16 Sept Near Coro Guerrillas raid three villages,
stealing arms and killing guard.
Caracas Police clash with terrorists:
one policeman killed.
Recent Terrorism in Venezuela
Attg'( 6s1-- -rnc7c set gflre (damage
$igitbom6 pmage to Creole
'0petlrie'(sikfh'attack in seven months
on this US-owned installation).
Headquarters of Accion Democratica
party destroyed by bombing.
US-owned DuPont warehouse destroyed;
loss estimated at $270,000.
Adams Shirt Store set afire in mistaken
belief US-owned.
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Western Hemisphere
Venezuelan terrorists have
kept up for the third week
their intensified campaign to
undermine the government of
President Betancourt.
During the period 15-20
September, there were eleven
major incidents of arson, bomb-
ing, and murder in six widely
separated cities. Four of the
targets were US-owned enter-
prises. At least one other
concern was attacked in the
mistaken belief it was American.
This record is almost
certainly incomplete. The
terrorists probably carried
out a number of less spectac-
ular raids which went unre-
ported either because they
escaped the notice of the press
or because the government has
suppressed their disclosure.
Antiterrorist activity
continues to be hampered by
the government's desire to
avoid lending substance to
the FALN's charge that it is
dictatorial. Thus far, Betan-
court has relied primarily on
the police rather than the
armed forces, with indifferent
results. Also, the recent
unification of the security
forces under the command of
the chief of armed forces
intelligence still has not
been wholly implemented.
measures.
The intensification of
terrorist attacks, however,
and the increasing restive-
ness in the officer corps of
the armed forces may yet force
Betancourt to take stricter
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27 Sept 63
CURRENT INTELLIGENCE WEEKLY SUMMARY Page 21
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INEG'RET
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