SINO-SOVIET BLOC ECONOMIC ACTIVITIES IN UNDERDEVELOPED AREAS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP92B01090R000700020061-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 7
• Document Creation Date: December 16, 2016
• Document Release Date: August 3, 2005
• Sequence Number: 61
• Publication Date: May 6, 1963
• Content Type: REPORT

BIWEEKLY REPORT
Approved For Release 2005/ RDP92BO1090R000700020061-2
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SINO - SOVIET BLOC
ECONOMIC ACTIVITIES
IN UNDERDEVELOPED AREAS
EIC WGR 1 /1 S9
6 May 1963
PREPARED BY THE WORKING GROUP
ON SINO-SOVIET BLOC ECONOMIC ACTIVITIES
IN UNDERDEVELOPED AREAS
SECRET
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AND DECLASSI FICATIDN
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Summary of Events
19 April - 2 May 1963
After prolonged negotiations, Brazil and the USSR on 20 April
finally signed a new 5-year trade agreement to replace their 1959
pact, which expired at the end of 1962. Major items to be traded in-
clude Soviet machinery, wheat, and crude oil and petroleum products
and Brazilian coffee, cotton, and rice. An important feature of the
new agreement, long sought by Brazil, is the provision for the use of
earnings from exports to the USSR to pay for imports from other Bloc
countries.
Trade agreements between Brazil and six Soviet Bloc countries,
negotiated in the spring of 1961, are now being effectuated. These
agreements call for greatly expanded trade levels and provide for up-
wards of $180 million in credits. Recent ratification of the agreements
is being followed up by trade missions from most of the Satellite coun-
tries, and Coleste, the Brazilian coordinating group for trade with the
Bloc, is considering the proposals set forth by the missions.
With the aid of the USSR, the Castro government has begun a sig-
nificant expansion of Cuba's electric power industry. Two major
powerplants, one at Mariel and one at Punta Rente, are currently
under construction; upon their completion, Cuba's electric power
capacity will be increased by 30 percent. The foreign exchange costs
of the two plants, estimated at $42 million, presumably will be covered
under the Soviet line of credit of $100 million extended in 1960.
Iraq has signed two contracts with the USSR for the delivery of six
MIG-21's and spare parts for T-54 tanks and armored personnel car-
riers. These are the first contracts between the two countries since
the overthrow of the Qasim regime in February.
The Moscow Narodny Bank of London, a Soviet-controlled institu-
tion, has declared its intention of establishing a branch in Beirut.
Soviet authorities may expect that an expansion of the Bank's activities
will enable the USSR to take better advantage of opportunities for trade
transactions in underdeveloped countries.
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The arrival of approximately 500 Soviet personnel at Hudaydah in
mid-April indicates that the USSR is stepping up implementation of its
aid program in Yemen. Approximately 700 Soviet technicians are esti-
mated to be in Yemen at the present time,
The Government of the Somali Republic has announced that Prime
Minister Abdirascid has accepted an invitation to visit Communist China
in the near future. Abdirascid, indicating pessimism about receiving
military assistance from the US and fear of an Ethiopia-Kenya alliance,
wants to see what military assistance the Chinese may provide. An
announcement was also made regarding the granting of air and landing
rights to Aeroflot.
Communist China has offered a $50 million commodity credit to
Indonesia. An Indonesian trade mission is scheduled to go to Peiping
in the near future to discuss the details of the offer. Previous eco-
nomic assistance extended by China is valued at $57. 4 million.
The delivery of Soviet surface-to-air missile equipment to Yugoslavia
has been confirmed. The equipment, including two types of radar asso-
ciated with the Soviet SA-2 missile system, was recently observed at
Batajnica Airfield. This is the first missile equipment actually delivered
to Yugoslavia and is probably the first unit of a SAM system to be set up
for the defense of the Belgrade area.
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CONTENTS
I. Latin America . . . . . . . . . . . . . . . . . . .
Page
1. New Trade Agreement with the USSR . . . . 1
2. Credits from Six Bloc Countries . . . . . . . 2
B. Soviet Assistance for Development of the Electric
Power Industry in Cuba . . . . . . . . . . . . 5
A. Soviet-Iraqi Arms Contracts . . . . . . . . . . 6
B. Soviet-Owned Bank for Beirut . . . . . . . . . . 7
C. Increase in Soviet Personnel in Yemen . . . . . . 8
III. Africa . . . . . . . . . . . . . . . . . . . . . . 9
A. Somali Response to the Bloc . . . . . . . . . . 9
B. Bloc Activities in Tanganyika .. . . . . . . . . . 9
Chinese Communist Offer of Credit to Indonesia . . . . 10
V. Europe . . . . . . . . . . . . . . . . . . . . . . t0
Soviet Missile Equipment in Yugoslavia . . . . . . . 10
VI. Brief Notes . . . . . . . . . . . . . . . . . . . . 11
Finland . . . . . . . . . . . . . . . . . . . . . . 11
India . . . . . . . . . . . . . . . . . . . . . . . 11
- iii -
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