SENIOR INTERDEPARTMENTAL GROUP

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00826A001100010030-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 11
• Document Creation Date: December 19, 2016
• Document Release Date: January 30, 2006
• Sequence Number: 30
• Publication Date: August 15, 1966
• Content Type: IR

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15 August 1966
No. 1863/66
Copy No.y
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This document contains information affecting the
national defense of the United States, within the
meaning of Title 18, sections 793 and 794, of the US
Code, as amended. Its transmission or revelation
of its contents to or receipt by an unauthorized
person is prohibited by law.
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Page
1.
Indonesia
1
2.
Congo (Kinshasa)
2
3.
Nigeria
3
5.
6.
Cuba
Dominican Republic
5
6
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Now that President Sukarno's power has been
effectively reduced, the government can direct its
attention to the economic situation, which may be-
come the nation's ultimate. political problem.
Production continues to decline, and galloping
inflation has raised prices sixfold in six months.
Foreign exchange reserves have been completely ex-
hausted, and the foreign debt is far beyond the
country's ability to pay. Even the 75 percent of
the population which engages in subsistence agri-
cultural production and rarely enters the money
economy is being affected by the general decline.
As a first step toward economic recovery,Indo-
nesia wants to reschedule payments on its inter-
national debt of some $2.4 billion. It has agreed
with Western creditor nations that the rescheduling
should be approached on a multilateral basis, and
a formal conference for this purpose is to be held
in Tokyo in mid-September.
Direct economic assistance is also needed.
For this, Indonesia looks toward negotiating bi-
lateral arrangements with individual countries.
Djakarta has also applied far readmission to the
International Monetary Fund and the World Bank.
To rejoin the Fund, however, Indonesia must pay
$47.4 million as its gold subscription and repur-
chase obligation. It hopes that an initial token
payment will be acceptable, but no early decision
on the matter seems likely.
Some economic relief may be achieved by resum-
ing trade relations with Singapore and Malaysia;
the former was once among Indonesia's most impor-
tant trading partners. Such action was made pos-
sible by the formal agreement on 11 August to end
military confrontation of Malaysia. This agreement
may also--Djakarta hopes--make Western nations more
responsive to requests for aid.
-1- 15 August 1966
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DEMOCRATIC REPUBLIC OF THE CONGO
(*j National capital
Consolidated province boundary
c~ Province capital
CENTRAL AFRICAN REPUBLIC S U D A N
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2. CONGO (KINSHASA)
The situation in the Congo continues to dete-
riorate.
The Mobutu government has made no real progress
in its efforts to end the mutiny of Katangan troops
in Kisangani. The truce arranged by Premier Mulamba
leaves the Katangans in control of most of the city,
and the government seems unlikely to regain their
allegiance without substantial concessions (see map).
Other Katangans and some mercenaries have left
their posts in the far northeast and may be moving
toward Kisangani. The government may manage to keep
them away from the city, but wherever they are they
will constitute yet another disruptive element which
the government has little chance of controlling.
Moreover, with the Katangans' withdrawal from the
campaign against the rebels, "simba" (rebel) bands
are beginning to show signs of renewed activity.
Tn Kinshasa, President Mobutu seems less con-
cerned with the situation in the northeast than with
his fears of a plot against him. His long-standing
suspicions of the Belgians seem to have broadened to
include other Western nationals as well. He also
distrusts Premier Mulamba.
His relations with Belgium have recently improved
slightly, but deep distrust remains on both sides.
Belgium has already withdrawn many of its military
advisers and seems likely to reduce its technical as-
sistance as well. These actions will reduce the
army's ability to cope with unrest and will also
add to Mobutu's feelin s of frustration with Belgium.
Approv
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The mutiny of Northern army elements which cata-
pulted 31-year-old Lt. Col. Gowon to power in Lagos
has left the army in a shambles and stirred up tribal
hatreds to a degree which threatens to break up the
country. Representative Nigerians are searching for
a new formula for continued union, but the process
will be protracted, and the outcome is uncertain.
The successful revolt resulted in the killing
of a large number of Ibo military personnel from
Eastern Nigeria, including former regime leader
Ironsi. Other Ibos have fled to their home region.
As a consequence, the command and support structure
of the army, largely staffed by the better educated
Ibos, has been shattered. Moreover, Gowon appar-
ently lacks full control over the hard-core North-
ern elements now dominant in most army units.
Eastern Military Governor Ojukwu, currently top
spokesman for the Ibos, still has not formally ac-
knowledged Gowon as Ironsi's successor. However,
he did send representatives to last week's pre-
liminary talks in Lagos on future regional relation-
ships. The Eastern leaders apparently continue to
doubt that the oil-rich East can remain united with
the other re ions.
There is a fair chance, however, that a single
international entity will survive provided the in-
terregional negotiations are not aborted by the
action of fractious military elements. This entity
would be a loose federation with a relatively weak
central government responsible for limited common
services.
The renewed exodus from the North of thousands
of Ibo civilians is already having a serious dis-
ruptive effect on business and services there. The US
AID program, which employed many Ibos, will suffer
as few ualified re lacements are available. 25X1
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5. CUBA
Fidel Castro's speech on 26 July revived a problem
which has marred his past relations with the Moscow-
oriented Communist parties of Latin America--the ques-
tion of peaceful or violent revolution.
The tone of the speech, in which Castro denounced
those "pseudorevolutionaries" who choose the path of
"electioneering" rather than violence, suggests that
he no longer intends to honor the accord reached at
the Havana meeting of Latin American Communist leaders
in November 1964. At that time he grudgingly agreed
to fund only those extremist groups endorsed by the
local parties. Since few parties favor armed strug-
gle, there has since been a sharp drop in actual Cuban
assistance.
Some party leaders who--unlike the Cubans--suffer
the consequences of governmental retaliation against
leftist violence are much concerned by Castro's re-
newal of the debate, For example, the secretary
general of the Costa Rican Communist Party has re-
cently acknowledged "serious differences" between
his party and the Castro regime and complained of
Cuban pressure to initiate guerrilla activity in Costa
Rica--a path he has consistently refused to take.
In Chile, Castro's remarks have further aggravated
the troubles of the Socialist-Communist alliance; Com-
munist leaders openly rejected the call for violence,
while Socialist Senator Allende publicly applauded the
speech.
Communist leaders in Venezuela have become so in-
censed with Castro and his heavy propaganda support
of Douglas Bravo's dissident hard-line faction that
they are reportedly considering a public denunciation
and possibly a ru ture in art relations with the
Castro regime.
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6. DOMINICAN REPUBLIC
Many Dominican military officers who supported
President Balaguer when his term began are disap-
pointed in his subsequent actions. Although they
pose no serious immediate challenge, their unrest--
which has been exaggerated by rumors--may cause Bala-
guer to take action to assert his authority over the
military before the Inter-American Peace Force
leaves in late September.
Some officers are probably dismayed at Balaguer's
refusal to move against the Communist and non-Com-
munist left. One group was irritated when he re-
buffed a request that exiled General Wessin be per-
mitted to return. Some are complaining about the
regime's austerity program, which has cut their
salaries.
Top-ranking officers are increasingly concerned
over the activities of Balaguer's military aide,
Colonel Nivar, who they believe is undercutting
their authority. Some suspect that Nivar, a Bala-
guer loyalist with an unsavory reputation, is eyeing
the post of minister of defense.
Nivar s in uence is ec fining,
but the role the President intends for him is still
obscure.
Tension may also have been increased by the order-
ing of changes in the armed farces' organization by
Balaguer, apparently in an effort to reduce the power
of ultraconservative officers. While last week's
disorders may cause a delay in implementing these
changes, Balaguer appears determined to make what he
has called "far-reaching" reforms.
The unrest, and such actions as the recent arbi-
trary arrest of leaders of Bosch's party by air force
officers, may cause Balaguer to speed up his time-
table for military reforms. As shown by his replace-
ment of the national police chief, Balaguer places
strong emphasis on the loyalty of subordinates.
He must move carefully, however, lest he upset a
l
i
ona
military establishment jealous of its tradit
political hegemony in the country.
_~_ 15 August 1966
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