WEEKLY CONTRIBUTIONS 29-50 LATIN AMERICA DIVISION, ORE, CIA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01090A000200050029-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 7
• Document Creation Date: December 12, 2016
• Document Release Date: May 7, 2002
• Sequence Number: 29
• Publication Date: July 18, 1950
• Content Type: PERRPT

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RET
424E74
Wee. , Contributions
Lat n 4 t 0 107133:Z07'".011,
au3,y 1950
CURRENT DEVELOMENTS
NORTHERN AREA: In Marto% Communist "peace" propaganda as apparently
successful in securing many signatirres backing the Stockholm resolution
(p. 2), The Jamaican leader, William Alexander Bustamante? is losing
graami to a potentially anti-US group (p. 2), In Haiti, junta member
Colonel Vagloire can make himself president if be so desires (p. 2).
SOUTHERN AREA: Argentin: Os bargaining position in UM-Argentina trade
negotiations has improved vith the increase of foreign competition for
the Argentine market (p. 3), Dissension In the Bolivian armed farces
adds to the shakiness of the government of that country (p? 4).
SPECIAL SUBJECTS
The Current Situation in Ecuador ..... ? ? ? ? ? ? 5
DOCUMENT NO
NO HANGE IN CLAS 0
DECLASSIFIED
CLASS. CHANGLD TO: T:.1 C
NEXT F?EVIEW DATE:
LJATE.
AUTH: 7
r ')
.:L?.111E-V/EiFf:
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sEcua-
Weekly Contributions, DILA, 29e50 1S J4y- 1950
(CIA Working Paper)
LEXICO: "Peace" A t vi has Same Success
con rece v repo s a periodicals indicate that
the strong press expos& of the Communist propaganda motive back
of the Stockholm resolution on the proscription of the atamic bomb
did not prevent the Llexican team, Committee from getting numerous
important signatures, It now seems that, through a wen-organised
and carer:03y executed canpaian from late April to add-June? a he tee
ogeneoua group (ranging from known Communist to extreme rightist
Catholic Church elements) wore induced to endorse this program.
This instance of apparent acceptance of Conmunist propaganda by non-
Communist groups should be, evaluated, however, in the liatht of the
subsequent prompt Lexlcan government, support of the United Nat ion
action in the Korean crisis and the pro-UN and pro-US attitude of
the L'exican prese as a whole, Improved Coremniat organization and
temporary success in front groups will mean little so long as the
weight of Liexican public opinion, which it is believed the govern-
ment and the press represent, remains an the side oe the democratic
forces,
JAIAICA: Dustamants Loain Ground to Potentially anta-US Group
uence 1 tics
and argent...zed laber thn tire nr- As-eciatnd in Jamaica --
is deelielna perc:atibly, In laat eveamner's general elections, his
prueika and relatively conservative Jamaica Leber Party (J1F) wee re-
turned with a draetically redncod nalarity (D(1A ak-4, 17 Jan 50),
As the result of a nnmher of reotakt jeale,t5.ctional atelatee, the
Bustamante International Trade Union (BITU) lost control of several
important labor =ions while naintaining only a preneeiner held on
others, The death or incapacitation of ten aaing and ailing Bmeta-
nante nould an the virtual dissolutian of the JT,P-rlIV oreanization,
aeamphile, toe rival Peeplea aatienal Parry (1)/T) and its
labor alilliate? tale Trades Union Congrea: (TUC), have been capital-
izing cm and accelerating the deterlorata= -17 rnte s position,
The PIX advocetes a proarae -t left-eina eoelaliem, including the
nationalization of the lolandte prineipal induatry? sugar, ahile
this party has a :aaastierabIe body of eoderates, its polinies are
often influeeced by a vocal left-wing eleronta Mae% as altimately
Seems inevitable, the PM wins eontrol of the aevernment? this radi-
cal group can be eounted on to level charges of imperWime and
racial discrimireation against the US in an atterpt to srotoe senti-
ment hostile to this country among Jamaicans.
3. I1U fl Liagloire aia -Assure areelknsE
ssy ? -aillWam, re-Poita that there are indications
that Colonel Uagloirea the most poverful meaber of the three-man
governing juntaa may- be elevated to the presidency at an early date,.
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Weekly Contributions, p/LA, 29-50 16 July 1950
(CIA Working Paper)
There is little doubt that, if he so desires, Magloire could maneu-
ver himself into office by one device or another, Be is popular
with the arey and influential civilian elements and has twice demon-
strated that he is the .aitical nester of the coantryteameting
Presidents Lescot in le ? amd. Eating last Shy. If Nagloire should
decide to assume the presidency, his administratiettemmld be pro-US
and probably conciliatory toward the Dominican Republic. Domestic-
ally, the miserable lot of the masses would be little improved, but
meauranae, mete vs raetering progress in the evolution
of democratic instruments of government would at least temporarily
be halted.
ARGEMINAt Position in Trade Talke With UK
g position in UK-
Argentine trade negotiations may well result in an agreement more
favorable to Argentina than was indicated a few nonths ago WU
7 Shr 50). A compromise on the meat price now seems probable. Final
agreement will improve UK-Argentine trade relations as well as Argen-
tine economic stability.
A key' factor strengthening Argentines position is in-
creased foreign coepetition for the Argentine market, both as an
outlet for manufactures and area source of agricultural products
that mma be obtained by barter, Some instances of this increased
competition are: an important agreement with Germany initialled in
June (US$124 million each *spy); expanding trade with Japan.; French
and Belgian consideration of possible credits for Argentina. At
present, Argentina also is negotiating a number of snail commodity
exchanges such as meat for German coal (in addition to the trade
agreement) and meat for Venezuelan petroleum ? that mould cut down
on traditional UK exports to Argentina, and earlier arrangements with
US companies for imports of dollar petroleum have already reduced,
requirements for UK oil during the next year (D/LA My, 2 May 50).
Further' stimulus to reduce Argentine purchases from the UK and to
lessen dependence on Britain generally. stems from Argentina's short-
age of sterling and its general dissatisfaction with trade relations
with the British during the past two years. Thus, in order to mini-
mize its loss of trade in Argentina, historically an important UK
market, Britain will have to offer more competitive terns in both
buying and selling.
A compromise on tarns will. probably-be reached in the near
future, since the meat trade is very important to both nations. It
is likely that Argentina will agree to a 10 to 15 percent increase in
the sterling meat price (as against the 40 percent demanded to com-
pensate for increased petroleum prices) and will also agree to make
arrangement for liquidation of commercial and financial arrears in
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Weekly Contributions, 29,-50 1.5 July 1950
(CIA working Paper)
the UK (reportedly II0 to E20 In return, the UK will
probably grant Argentina at least a small loan in the guise or a.
"reciprocal credit" or advance payment for imports from Argentina.
Final agreement on terms will improve UK-Argentine
trade relations as well as Argentine economic stability. A pro-
longed period of uncertainty- that has been prejudicial to UK-
Argentine trade will be ended and provision will have been made
for the liquidation of Argentine commercial and financial debts
to the UK. It is true that the new relationship between the prices
of moat and petroleum will not be as favorable to Argentina as it
was in the June 1949 agreement; the terns now anticipated, however,
will be a substantial improvement over Argentine prospects several
months ago, and should be favorably reflected in the larger pattern
of over-all UK-Argentine economic and financial relations of which
the meat price is only one aspect.
5. BILIVIAL:
1 Dissension Undermines Government's Stabilitr
governmen a army supporr,-"ca=3:cr irTraefendent
for its continuance in power, is threatened by dissension centering
about a struggle between Chief of Staff Colonel Rios Road l and
National Police Director Colonel Vincenti. Possibly because ill
feeling between the arpy and police is of long standings Ides Roadl
has been trying to force the resignation of Vincenti? who, in twill
has been attenpting to oust Rios Rosel. Some senior arpy officers
suspect Riot Rosel of intrigue with theNNR and these elements, as
well as President Urriolagoitia, are backing Vincenti. Mile it is
possible that the present difficulty maybe resolved by the replace-
ment of Rios Rosel, the existence of dissension within the army
impairs the stability of the goverment by depriving it of sorely
needed strength to resist the continued revolutionary attempts of
various subversive groups.
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Weekly Contributions, D/LA?29-50 18 July 1950
(CIA Working Paper)
Situation Memorandum 44-50
21119,?Surr ey_it S attia atten_le
(xgamiz -- Recent events have temporarily strengthened President
Plaza's position, but will not basically alter the unstable poli-
tical situation. Economic conditions continue to be unfavorable.
Despite the two subversive movements within the army, at the
moment it still appears willing to support the present administra-
tion. The government may henceforth adopt stronger measures
against any increase in Communist activities. Ecuador continues
to follow the lead Of US policy in international affairs.
-- US security interbsts have not been affected by recent
developments in Ecuador.)
Zajaltina
The government's quick suppression of Guevara Moreno 's attempted revolt
of 15 July will temporarily strengthen President Plaza's position but will
not basically alter continuing unstable political conditions. The arrest
of Guevara and his revolutionary supporters removes at least for the time
being one threat to the present government and temporarily weakens other
opposition groups by eliminating the possibility of their collaborating with
the hitherto organized Guevara movement in an effort to overthrow the govern-
ment. However, the political situation remains unstable due to the existence
of two subversive movements within the army led by Minister of Defense Manuel
Diaz-Granados and by Col. asar Alfaro, and the possibility of a revolutionary
coup by the military cannot be discounted.
It is not believed that the recent mass cabinet resignation and conse-
quent reorganization will have the hoped-for effect of significantly strength-
ening the administration's position. The president's decision to reappoint
Diaz-Granados as Minister of Defense but not to retain Guillermo Ramos (until
now Plaza's right hand man, perhaps the outstanding leader of the MCDN? but
an arch enemy of Diaz-(ranados) in the important post of Minister of Govern-
ment indicates Plaza's real concern over the threat currently presented by
Diaz's subversive movement. Whether this decision resulted from Plaza's fear
that a revolution would be precipitated by failure to rename Diaz to the cabi-
net or from a hope of winning in this way Diaz 'a confidence and support, it
is not likely that it will greatly discourage the subversive activities of the
Minister of Defense.
Although the June congressional elections placed an MCDN-Conservative
party majority in Congress (D/LA Wkly, 31 May 50), thereby eliminating the
possibility that Plaza might be forced out by a legislative coup, this de-
velopment likewise has not improved the government's stability in view of
the activities of the subversive military elements who still base their hopes
on staging a successful coup.
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Weekly Contributions" D/LA, 29-50
(CIA Working. Paper)
Sitnetion nemorandum 44-50
1.n% July 1957)
1 ['
Zoom:clic
Economic conditions are still quite unfavorable eed there le no indication
that they will improve to any greet extent in the conInn quart,or The Moll
Company's cessation of explorations for oil in the Oriente in kern will eventu-
ally force 4,000 people out of work. As yet no plane n,ve been rade by the
government to cope with the unenp/eynent situation, whiet will reach 'Hous
propertions in the early fell with the closing of the Pertovele nole nLrAeQ
Regarding the export of Ecuador's agricelturel nroduets, prevni1:-1; high
market prices for cacao and coffee will coetinue to assure a substantial in-
come from those sources, even though cacao nrodection has fallen off elnoet
one third from the 1949 level; also greater revenue ray be expected from the
sale of bananas in view of plans of Anerican fruit companies to expand imports
from Ecuwior. However) theoe fnctore have not offset the adveree ef!Not which
the leo word marl;et price for rice continues to helm on rcuader's economy,
It is expected that the C,2500000 Sxin Bank loan :,,Tallteci reuader in June for
modernization of rice production methods will eventually enable Sounder to
lower costs of production and then compete edvantaoeoesly on tin worli narket;
but the beneficial effects of the loan will not begin tn le felt for rtx
months to a yeer.
President Plaza's decision to postpone (with the :ereissien of the Teter-
national ronetery FUed) revising the nultiple-exchnnce rete lea in order that
the Coneress convening In Aecest nay ral:e the final deeirion In this -ntter
may be attributed nainln to his foer nf erenting any iseue wIleh nicht be
seized upon by opposition forces to nake hie eeliticul neeitior even eore pre-
carioes than it IS at prevent- Political consideratfons were also partially
responsible for the firn attitude whiel the nevernneet ha maint:1),:la toward
labor in recent worteereemergeee;t eonfliets, far it is c?xnectcd that eech a
policy will briec Plaza nore support fron te middle class and wealth croups.
1,1214172:
At the norent the arry appears willinn to Tport the novern-ent but the
growing strength of the two stibversive mavoleee's within the nrmn (see Zatfoina)
could change this e!tuetion in the coning ve0;.s. Doubts aboet the loyalty of
particular units and unit connanders have already caused the ceverneent to effect
several transfers. In late rarch it replaced nejor Antonio Salgado the pro-
Guevara commander of the inportant mechanized unit at Sar Antor:lo, with an officer
loyal to the administration; in ray it rushed entieGuevera effieerr to arry
units in some of the southera provinces ether? Guevara reoortedle ned made gains;
and in mid-June it sought to consolidate its control in the reclon of Guayaquil
by exchanging the possibly dieloyel Pichincha Infantry Batta/ien with the
Guayas battalion located et Anbeto (the unit which vas responsible ler arrest-
ing Guevera on 15 July) and strengthening the cavalry roup in Guayucleil by an
additional fifty non (D/IA 27 Jun 50)
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Weeklila Contributions, D/LA, 29-50
(CIA Working Paper)
Situation Memorandum 44-50
Ju2y 1950
The army is not up to the strength envisaged in its elans for 19e0 siece
less than half of the authorized nunber of conscipts have been celled up fas
training (D/LA Wkly, 11 Apr 50).
The barter agreement by which :tender received Czochoslovu carbiees,
bayonets and cartridges in return for rice and cacao repreeente u ferther step
away from arms standardization in the Hemisphere.
The government's apprehending :Iela Vertinez and locking her up overnight
(on the pretext that she had absconded with fends deeigeeted for a peer family)
nay be regarded as a warning to the Communists thot any greet increase in their
activities nay henceforth be coentered with stronger moesures on the part of
the govornmert, Since her return from a trip to !astern Furorc and the Soviet
Unioe, !Tele Vertinez has directed the reorgenization of "eace connitteesi in ,
Ecuador, a proeran whiCh is being carried on mainly by lecenior's eonen Comnenists
She has succeeded in persuuding nany of the housewives le the Quito area to
participate in "peace meetings", and other nroninent women Coumunists have beep
active organizing the feninino movenent in -duayageil,
1
In the recent congressional elections the Conmuniste volled about 5,000
votes, This represents a considerable increase over their foreer voting strength
(which cies about 3,000), but despite this gain the Co -.units continue to
occupy a position of minor political importance in the countrg It is not
estimated thet they will make any significant gains in the coming metes.
Internetioeal
Lcuador's continuing eeeire to act with the 1",.3 in ratters jesrteining to
foreign affairs was f, rther evidenced recontle by its proryt asourances of
solidarity with the UC tosition regerding the Koreen situetion and its vote in
fever of the !S-sponsorod Security Coencil resolution of 27 June, Ecuador may,
be expected to continue to support US policy in all netters pertaining to the
East-West struggle.
1
Anti-eovernrent forces tried recently to capitalize upon the longstazing
anti-Peruvian feeling in Sceador by accusinc the adrinietration of "treason"
when it siened a trade aerecrent Atli Peru Probably because their uotivee
were ebvio sly room dolitical then sa,:riotic, their efforts met with only
limited success. There hove beee no fertter jeveloements regareene ehe settle-
ment of the Lag-rtococha boundery dispute with Peru. A meeting of the guarantor
nations to eiSMISS possibilities for a vottlement was crier:L=12r scheduled for,
June, then porteened until after the Peruvian elections; as yet no date has
been set for the eeeting,
001008M7"-- 7,
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