CURRENT INTELLIGENCE WEEKLY SUMMARY 14 DEC 1962
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SECRET
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
DOS REVIEW COMPLETE
COPY NO. 76
OCI NO. 0447/62
14 December 1962
NGA Review Complete
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
P Ivt.ka.S.Y ~rC+y RL
,Xaocy
SECRET
GROUP 1
Excluded from automatic
downgrading and
declassification
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CURRENT INTELLIGENCE WEEKLY SUMMARY
14 December 19102
T H E W E E K I N B R I E F
(Information as of 1200 EST 13 Dee)
CUBA . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 1
Activity at the four Soviet armored group encampments
in Cuba is continuing, with no evidence that preparations
for withdrawing these forces are under way. The function
of the installation at Mayari Arriba in eastern Cuba re-
mains unestablished; it may serve as a storage or sup-
port facility for cruise missiles. Recent public statements
suggest that Cuba is considering giving greater support
than before the crisis to Latin American insurrectionary
movements. The recent nationalization of small- and medium-
size businesses by the Castro regime may further increase
domestic disenchantment with the regime.
SOVIET FOREIGN POLICY :DEVELOPMENTS . . . . . . . . . . . . Page 3
Khrushchev's 12 December speech to the Supreme Soviet
was intended as a definitive interpretation of his actions
in the Cuban crisis. His account of the crisis was aimed
primarily at establishing the point that the USSR had "con-
firmed its agreement" to withdraw offensive weapons only
after a public statement by President Kennedy that--in
Khrushchev's words--the "US would not attack Cuba and would
restrain its allies from such an action." The speech con-
veyed no sense of urgency regarding a Berlin settlement
and implied that Soviet domestic problems will be given
priority over foreign policy in the period immediately ahead.
Khrushchev's thinLy veiled attack on the Chinese Com-
munists will undoubtedly produce a vigorous response from
Peiping. These exchanges will increase the momentum of
the dispute and make it more difficult to avoid a formal
break in party relations. In contrast to the deepening
Sino-Soviet rift, the growing rapprochement between Moscow
and Belgrade was symbolized by Marshal Tito's presence on
the platform when Khrushchev addressed the Supreme Soviet
and by the fact that Tito himself addressed that body the
following day. An address by a foreigner to the Supreme
Soviet is highly unusual, if not unprecedented.
At Geneva, the Soviet delegate formally introduced Mos-
cow's proposal for using unmanned seismic stations to police
a nuclear test ban. The USSR's next move may be to declare
another unilateral moratorium on Soviet testing to take ef-
fect on 1 January.
THE SINO-INDIAN DISPUTE: . . . . . . . . . . . . . . . . . Page 8
Increasingly strident Chinese pronouncements and Nehru's
formal rejection of Peiping's key proposals for mutual with-
drawal and negotiation have moved the border dispute a bit
closer to a resumption of fighting. The cease-fire along
the frontier is now three weeks old and Chinese withdrawals,
at least in the northeast, are apparently continuing at a
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CURRENT INTELLIGENCE WEEKLY SUMMARY
slow pace. The conference of six nonaligned nations in
Colombo, which concluded on 12 December, seemed agreed only
that the two adversaries should negotiate rather than fight.
Ceylonese Prime Minister Bandaranaike's projected visit
to New Delhi and Peiping with the conference proposals will
serve to provide both sides with additional time for maneuver.
1963 SOVIET PLAN AND BUDGET . . . . . . . . . . . . . . . Page 11
The USSR's 1963 plan and budget show no change in Soviet
planners' emphasis on heavy industry; only modest improve-
ments are scheduled for agriculture and consumer goods pro-
duction. Military spending is scheduled to increase only
slightly. Most growth rates for 1963 are shaded downward
from the 1962 plan, apparently reflecting mounting difficulties
in the allocation of resources.
CZECHOSLOVAK PARTY CONGRESS . . . . . . . . . . . . . . . . Page 14
The recent 12th congress--postponed for two months to
enable party boss Novotny to silence his opponents--was used
to demonstrate his renewed authority. He continued his re-
fusal to institute de-Stalinization in Czechoslovakia, but
nevertheless reaffirmed his fealty to Moscow by identifying
his regime with Khrushchev's anti-Stalinist policies on
such issues as China and Yugoslavia. Specific solutions
to the country's economic problems, a cause of party and
popular disaffection were postponed until the new seven-
year plan is completed in 1963. 25X1
ULBRICHT PREPARES FOR PARTY CONGRESS . . . . . . . . . . . Page 16
As the time approaches for the sixth party congress--
scheduled for mid-January--Ulbricht is attempting to recast
the image of himself and the party in the light of current
Soviet positions on peaceful coexistence and de-Stalinization.
He is bringing his party's position into line with Moscow's
by de-emphasizing the Berlin issue, and he has belatedly
taken some limited measures against Stalinist practices in
the domestic apparatus. Major changes in the economic ap-
paratus are likely. Despite Ulbricht's efforts, Moscow may
consider his Stalinist background a handicap and use the
congress as a means of paving: the way for his retirement.
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THE MACMILLAN - DE GAULLE MEETING . . . . . . . . ... . . Page 20
Macmillan's 15-16 December visit to Paris coincides
with the movement of the UK-EEC talks in Brussels into
the decisive phase and with increased :European preoccupa-
tion with the future course of European-American ties.
Macmillan, who asked for the meeting, is increasingly
anxious for domestic political reasons to see the UK-EEC
talks brought to an early conclusion. There is new specula-
tion in London and Paris that he may be tempted to offer
De Gaulle closer military cooperation in return for. some
concession that he can represent in Britain as progress.
THE BRUNEI REVOLT . . . . . . . . . . . . . . . . . . . . Page 22
The short-lived revolt in Brunei 'brought into the open
foreign and Bornean opposition to the projected federation
of Malaysia. Substantial British forces were used to sup-
press the rebellion, pointing up the degree to which the
federation's stability will depend on continued outside
military support. Malayan Prime Minister Rahman's annoyance
with Philippine sympathy for the rebels was turned against
Djakarta when President Sukarno publicly intimated his
support for the insurgents.
TENSIONS CONTINUE IN LAOS . . . . . . . . . . . . . . . . Page 23
Factional tensions continue to impede even nominal prog-
ress toward national renunification. Souvanna's control
over his neutralist military forces has evidently been
seriously eroded, and the further estrangement of his
foreign minister, Quinim Pholsena, attests to his loss of
significant neutralist support. Meanwhile, the Pathet
Lao continue to block effective inspection procedures by
the International Control Commission. Phoumi returned to
Laos from Moscow and Peiping with substantial aid com-
mitments.
FIGHTING IN YEMEN INCONCLUSIVE . . . . . . . . . . . . . . Page 24
Fighting between royalist tribesmen and Egyptian and
Yemeni revolutionary forces in northern and eastern Yemen
is still inconclusive. The Yemeni royalists in an effort
to stave off US recognition of the revolutionary regime,
have made exaggerated claims of successes. However, the
royalists control approximately the same area they have
controlled since the revolution began.
INSTABILITY IN TURKEY . . . . . . . . . . .. . . . . . . . Page 25
Political stability in Turkey is again threatened by
recurrent factionalism both in the governing political party
and in the air force. Premier Inonu.has moved swiftly
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CURRENT INTELLIGENCE WEEKLY SUMMARY
14 December 1962
against his critics in the Republican Peoples Party, but
a major split in the party may occur at its 14-16 December
national con ress or sY-ortl afterward.
CONGO . . . . . . . . . . . . . . . . . . . . . . . . . . Page 26
Adoula's opposition in Parliament appears to be moving
toward another showdown with him. The government is in
disarray 25X1
UN officials meanwhile have begun
to mount a new pressure campaign on Tshombe to induce him
to implement the UN plan. There are signs that if the West
fails to support U Thant's intended call for a copper embargo,
the UN envisages new moves in Katanga involving the use of
troops.
ALGERIAN REGIME MODERATES NEUTRALIST STANCE . . . . . . . Page 28
The Ben Bella government is taking a more balanced
line in foreign affairs. Although Ben Bella still seeks
aid from any quarter, his regime apparently believes that
its best hope of survival lies in economic cooperation
with the West. Paris has agreed to provide interim financial
assistance and will negotiate for broader aid arrangements. 25X1
Meanwhile, the UAR has announced a $24,000,000 loan.
ARGENTINA . . . . . . . . . . . . . . . . . . . . . . . . Page 29
The team headed by new Minister of the Economy Mendez
Delfino must contend with serious economic deterioration
in Argentina and is unlikely to achieve quick results. With-
out such results, the political situation could again become
explosive. 25X1
BRAZILIAN - SOVIET BLOC TRADE . . . . . . . . . . . . . . Page 30
Some expansion in Brazilian - Soviet bloc trade is likely
to result from a new pact with Moscow to be signed this month;
such trade now accounts for about 5 percent of Brazil's total
trade. It is not yet clear whether this agreement will pro-
vide for economic development credits as did a recent
Brazilian-Polish agreement.
ELECTIONS IN THE DOMINICAN REPUBLIC . . . . . . . . . . . Page 31
Presidential and congressional elections are scheduled
for 20 December.
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The two main political parties have been conducting
a vicious campaign
THANT AND THE UN SECRETARIAT . . . . . . . . . . . . . . . Page 1
During the past year as acting secretary general, Thant
has shown a capacity for delicate diplomacy but seems to
have defined his and the Secretariat's role within narrow
limits. He has shown neither the will to nor the intention
of expanding the influence of the office as did his more
forceful predecessors, Trygve Lie and Dag Hammarskjold.
Thant delegates responsibility more widely than Hammarskjold,
and the oven-all effectiveness of the UNf during his full term
as secretary general will thus depend largely on the capabilities
of the eight principal advisers he has chosen to represent
the major membership groupings in the UN.
TANGANYIKA A YEAR AFTER INDEPENDENCE . . . . . . . . . . . Page 4
During Tanganyika's first year of independence, moderate
leader Julius Nyerere and his associates consolidated their
control of this former British trust territory. Elected
last month by a near-unanimous vote to the newly created
presidency, Nyerere seems to have a secure hold for the pres-
ent, despite the influence of a few radicals in key positions
such as Interior Minister Kambona. Nyerere has not been
able, however, to overcome Tanganyika's many economic and
social handicaps, and the impoverished country has been
weakened by the departure of hundreds of non-African managers
and specialists. During the year, Tanganyika became a cen-
ter for African nationalist activity directed at other east
and south African territories.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
25X1 CUBA
Cuba reveals that activity s
continuing at the four Soviet
armored group encampments on
the island with no sign that
preparations for their with-
drawal are under way. It was
the encampment near
Artemisa that ten buildings have
been constructed there and
another 19 are presently being
built .
The recent spate of public
addresses by leading Cuban
officials on the necessity for
insurrection in other Latin
American countries reflects a
more aggressive stance than
prior to the "missile crisis"
and suggests that a decision to
step up Cuban support for sub-
versive groups in other Latin
American countries may be un-
der, consideration. 25X1
Che Guevara and Education
Minister Armando Hart have
been in the forefront since
late November in publicly ex-
pressing the view that the
only road to the "liberation"
of the Latin American peoples
is the road of insurrection.
Fidel Castro's earlier line
denying Cuban "export" of the
revolution to Latin America
and claiming that the Cuban
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CURRENT INTELLIGENCE WEEKLY SUMMARY
"example" is sufficient, was
given only perfunctory atten-
tion in the recent Guevara and
Hart speeches.
The line emerging in these
speeches appears stronger than
that espoused in the "Second
Declaration of Havana" pro-
mulgated last February, which
suggested that in certain cir-
cumstances Communist-dominated
coalitions could come to power
by peaceful means. The whole
tenor of the recent speeches
suggests that Cuba intends to
provide every assistance with-
Campo Flondo. Santo Craz
HAVAN A Idol Norte
~Sigyanea
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CUBA
AStF ! AS
La s i orr -
(Probably abandoned
as .(3 December)
SELECTED SOVIET FORCES AND INSTALLATIONS
Armored group
Unidentified ground headquarters
? Surface-to-Air Missile (SAM) site
O SAM support and assembly area
Cruise missile site
"the humiliation of the with-
drawal of the Russian missiles"
by making renewed'efforts to
"light revolutionary fires in
neighboring countries."
Cuban domestic propaganda
media are playing up the "en-
thusiastic" response of the
populace to the 4 December pro-
mulgation of a decree nation-
alizing all small and medium-
size Cuban businesses except
those owned and operated by a
single family. The new meas-
ure may encourage further dis-
enchantment with Castro among
in its means to Latin American
insurgents.
The attention given in the
controlled Cuban press to de-
velopments in Venezuela in
recent weeks strongly suggests
that, if Cubans are not involved
in the insurrectionary effort
there, they are certainly fol-
lowing it with special interest.
The nationalization meas-
ure may reflect the regime's
increasing concern over con-
tinuing deterioration in the
domestic economy. Since the
measure was invoked, Havana
radio has featured stories of
the uncovering of millions of
dollars' worth of "essential"
merchandise and cash that had
been "concealed for specula-
tive -purposes."
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SOVIET FOREIGN POLICY DEVELOPMENTS
Khrushchev's lengthy and
wide-ranging speech to the Su-
preme Soviet on 19 December was
intended as the definitive in-
terpretation of his conduct in
the Cuban crisis. It provided
further evidence that the Soviet
leaders are going through a pe-
riodof consolidation and reap-
praisal of their foreign policy,
complicated by the need to deal
simultaneously with serious
intra-bloc problems aggravated
by Peiping's charges of Soviet
appeasement on Cuba.
Berlin and German
Khrushchev's speech con-
veyed no sense of urgency re-
garding a new round of negotia-
tions on Berlin and implied that
domestic problems will be given
priority over foreign policy in
the period immediately ahead.
"All our thoughts," he said,
"are turned to creative construc-
tion, to the building of Commu-
nism. "
Among the "top priority
problems" which must be resolved,
the Soviet premier placed the
Berlin question in second posi-
tion following disarmament.
Khrushchev asserted that the
main controversial issue which
prevents a solution to the Berlin
problem is the "status" of the
Western forces in West Berlin
and "under what flag these troops
shall be there and for how long
they will remain there."
not mention any time limit on
the presence of Western troops
in West Berlin nor did he al-
lude to any of the proposed
variants--most recently advanced
during Khrushchev's talk with the
Canadian ambassador--by which the
NATO forces could be altered.
The Soviet premier again omitted
any reference to a specific dead-
line for a German peace treaty.
Foreign Mint.Rter Gromyko,
in his 13 December address be-
fore the Supreme Soviet, main-
tained that the exchange of
views between Moscow and Wash-
ington on Berlin and Germany
"had not been completed and is
to be continued." He went on
to conclude that the USSR "shall
not count by the pages of a cal-
endar when this exchange of
opinions must be concluded, but
a settlement is sought."
Soviet leaders seem to en-
visage a hiatus in serious nego-
tuitions with the West in the
immediate future. Khrushchev's
concern, however, to discourage
the West from adopting a more
demanding posture in dealing
with Moscow during this period
was evident in the warning in
his speech that Western advo-
cates of a "tough" policy should
not assume the USSR will retreat
or make concessions on other is-
sues. He reiterated the claim
that Soviet strategic weapons
"are the best in the world."
Cuba
The Soviet leader maintained
that Western troops should not
"represent" NATO countries; that
the NATO flag should be replaced
with the UN flag; and that the
UN should assume "specific in-
ternational undertakings and
functions there." Khrushchev did
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Khrushchev's long account
of the Cuban crisis was aimed
primarily at establishing the
point that the USSR had "con-
firmed its agreement" to with-
draw offensive weapons only
after a public statement by
President Kennedy that--in
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Khrushchev's words--the "US
would not attack Cuba and would
restrain its allies from such
an action."
The Soviet leader repeated
the line that his actions had
prevented a US invasion of Cuba,
thwarted the desires of "rabid
imperialists" to launch a nuclear
war, and proved that the USSR
and its allies "are in a posi-
tion to impose peace on the
protagonists of war." He ac-
knowledged, however, that "lead-
ing circles in the US" had dis-
played a "sober approach" and
that both sides had made con-
cessions.
The Soviet premier tried
to put the best face possible
on the USSR's strained relations
with Cuba. He hailed Cuba's
"glorious leaders headed by our
great friend, Fidel Castro," and
pledged that the Soviet Union
will continue to help the Cubans
and never leave them defenseless.
He said he would "firmly adhere"
to his agreement with President
Kennedy as long as the US car-
ries out its pledges, but the
USSR would "take such actions
as would be required in the cir-
cumstances" if the US does not
respect its commitments.
Khrushchev went over to
the offensive in countering Chi-
nese attacks on his handling of
the Cuban crisis. He denounced
"irresponsible charges" by people
who "call themselves Marxist-
Leninists." He defended the
correctness of his actions in
light of the "time, place, and
circumstances" of the Cuban
crisis.
For the first time in the
Sino-Soviet dispute, Khrushchev
confronted the Chinese with their
failure to expel the "colonial-
ists" from Hong Kong and Macao.
He underscored the parallel with
his behavior on Cuba by saying
"it would be wrong to push China
into some action which it re-
gards as untimely."
Although Khrushchev con-
tinued to avoid a direct attack
on the Chinese, he made it clear
that they were the real target
by referring to "those who are
pushing" the Albanians into de-
nouncing Soviet actions in Cuba.
His personal intervention with
such a thinly veiled attack will
undoubtedly produce a vigorous
Chinese response; this will in-
crease the momentum of the dis-
pute and make it more difficult
to avoid a formal break in party
relations.
Sino-Soviet Dispute
Khrushchev's speech quick-
ened the pace of developments
in the two major trends in bloc
political affairs--the increasing
estrangement of Moscow and Pei-
ping and the growing rapproche-
ment between Moscow and Belgrade.
The increasingly open nature of
the exchanges between the USSR
and China reflected a consider-
able hardening of the divergent
molds in which they fit their
views and policies.
The USSR is demonstrating
clearly that it has no inten-
tion of allowing Peiping to
influence its future policies.
The Chinese, despite their grave
domestic problems, have continued
their vigorous resistance to
Soviet pressures to compel them
to recognize Moscow's leader-
ship of the world Communist move-
ment.
Neither side, however,
appears willing to face up to
the consequences of an open
break along the lines of the
Soviet-Yugoslav rupture in 1948.
Peiping probably believes such
a break would seriously jeopard-
ize its prospects in the strug-
gle for leadership. Both parties
seem to anticipate a prolonged
conflict in which the disad-
vantages of a definitive break
will continue to outweigh pos-
sible gains for the foreseeable
future.
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CURRENT INTELLIGENCE WEER:LY SUMMARY
Within the limits imposed
by this concept both sides con-
tinue their ideological ping-
ponggame. The series of re-
cently concluded party congresses
has forced both sides to defend
their positions, and the cumula-
tive effect has been to heighten
the tensions between them.
Nevertheless, both sides con-
tinue to move with some caution.
The USSR has not yet orig-
inated any comment specifically
naming the Chinese as the object
of its attacks. The thinly
veiled attacks in Khrushchev's
speech and Pravda's reproduction
on 10 December of the speeches
of Italian Communist leader
Togliatti and Czech party leader
Novotny to their respective
party congresses--speeches which
do attack China directl3r--leave
no doubt, however, that the Chi-
nese are the intended targets of
Soviet strictures against the
dogmatists in the international
Communist movement.
This is not the first time
the Soviet Union has reprinted
material originated by other
Communist parties criticizing
the Chinese for their support
of the Albanian party. When
the dispute had reached a par-
ticularly high point of ten-
sion after the Soviet 22nd party
congress, Pravda reprinted
criticism by a -number of bloc
parties decrying the Chinese
support for the Albanians.
Moscow even reprinted some
broader attacks on the Chinese,
but by less important foreign
parties.
Nevertheless, Pravda's
current use of the speeches
of major international Communist
figures and sharply pointed
language of Khrushchev's speech
does move the dispute into a new
phase.
Sino-Indian Border
Khrushchev's implicit allo-
cation of equal blame to both
sides for the Sino-Indian fight-
ing is but a further affront to
Peiping. Although he expressed
pleasure at the cease-fire an-
nouncement, Khrushchev withheld
support for the Chinese proposals
to end the conflict, and merely
reminded both sides, and thus
particularly the Chinese, that
it would have been better if
neither side had resorted to
arms.
Moreover, Khrushchev's im-
plication that the USSR had an
equal interest in the preserva-
tion of good relations with both
"fraternal" China and "friendly"
India could only be intended as
a new warning to Peiping that
Moscow continues to oppose any
action that might force India to
abandon its unaligned status and
to look to the West.
Soviet-Yugoslav Relations
While Sino-Soviet party
relations are being strained
to the breaking point, Moscow's
political relations with Yugo-
slavia are rapidly mending.
The growing rapprochement be-
tween the two countries was
symbolized by the presence of
Tito on the platform while Khru-
shchev spoke to the Supreme So-
viet and Tito's address the
next day to the same body. An
address by a foreigner to the
Supreme Soviet is highly un-
usual, if not unprecedented.
In his speech Khrushchev
stressed the efforts that the
USSR was making to overcome the
remaining ideological divergen-
cies with the Yugoslavs. Con-
trasting the behavior of the
Albanian party, and by implica-
tion the Chinese, Khrushchev
noted that the Yugoslav position
on Cuba, and on other interna-
tional issues, was wholly cor-
rect., To justify his recent
moves to bring Yugoslavia closer
into the bloc, Khrushchev re-
rived the concept of separate
roads to socialism.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Tito replied the next day,
adding his pledge to work to
eliminate the remaining differ-
ences. He noted that the Yugo-
slavs "mainly agree" with what
Khrushchev had said concerning
relations between their countries.
His remarks, added to the rather
lengthy and significant review
of relations by Khrushchev, in-
dicate that mutually satisfac-
tory arrangements have been
worked out in the talks the two
leaders have been having.
There had been earlier in-
dications that the question of
party relations figured strongly
in Tito's visit to the USSR.
The nature of the negotiating
teams in the 5-7 December talks
between the Yugoslavs and the
Russians suggested that these
relations were a significant
item on the agenda.
Pravda and Izvestia have
been giv -ng precedence to party
rather than government titles
of both Khrushchev and Tito in
their announcements concerning
the bilateral discussions. A
further indication of the im-
portance which both sides are
giving to the question of party
relations is the presence of
Yuri Andropov, the Soviet party
central secretary for bloc party
relations, among those who ac-
companied Tito on his 7-11 De-
cemberside trip to Volgograd.
Chinese Positions
The Soviet-Yugoslav rap-
prochement has led the Chinese
into violent condemnation of
Yugoslavia. At the Italian
party congress the Chinese dele-
gate went so far as to claim
that Tito "and his clique" have
turned Yugoslavia into a "100-
percent capitalist state."
Denunciations of Tito by
the Chinese are accompanied by
expressions of firm support for
the Albanians. In the latest
issue of the party journal Red
Flair, Chinese politburo member
Li Hsien-nien avowed that China
wou'Ld fight forever, shoulder
to shoulder with Albania. He.
claimed that the Albanians had
been stigmatized as dogmatists,
sectarians, adventurists, belli-
cose elements, and opponents of
peaceful coexistence only be-
cause of their "unswerving
loyalty to Marxism-Leninism."
Although the Chinese recog-
nize that they cannot deflect
Khrushchev from his present poli-
cies, they have not given up their
efforts to tie his hands as much
as possible. According to the
Italian Communist newspaper L'Unita,
the Chinese proposed a new meeting
of Communist parties in a letter
react by Novotny at the Czech party
congress. At such a meeting, Pei-
ping; would adopt the strategy it
used at the similar meetings in
1957 and 1960--i.e,, to make Chi-
nese signature to a declaration of
principles contingent on concessions
to Chinese viewpoints.
The USSR, unwilling to sub-
ject itself again to such a
Chinese veto, has taken the posi-
tion that the many party congresses
held since 1960 in effect consti-
tuted consultations among the Com-
munist parties. Speaking for the
Chinese, the North Korean delegate
to the Czech party congress re-
jected this view when he said in
his speech that the Czech con-
gress was not equivalent to a
formal consultative meeting of
the international Communist move-
ment. Moscow, however, is not
likely to pay much attention to
this disavowal.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Outer Space
Moscow has hailed the 5 De-
cember announcement of the US-
Soviet agreement on joint coop-
eration in peaceful development
of outer space. The agreement,
negotiated during bilateral talks
earlier this year resulting from
an exchange of letters between
the President and Khrushchev,
provides for US-Soviet coopera-
tion in the fields of meteorology,
a world geomagnetic survey, and
satellite. telecommunications.
Moscow propaganda has termed
the agreement "the first big
step toward a beginning" in the
joint peaceful exploitation of
outer space by "the two great
powers." Moscow has not yet re-
affirmed the line put forth by
Khrushchev last spring that ex-
tensive cooperation in space de-
pends on solution of the disarma-
ment problem.
Disarmament and Nuclear Test Ban
In his Supreme Soviet speech
Khrushchev listed disarmament as
the first item on the list of "top
priority problems" whose solution
"brooks no delay." He deprecated
the lack of progress in disarma-
ment negotiations over the past
three years, but promised that
the USSR's "entire foreign polit-
ical activity" will be directed
toward reaching a disarmament
agreement.
He referred only briefly to
the test ban problem, noting that
if the US and Britain "show wis-
dom," an agreement can be reached.
He accused the Western powers of
"standing still."
At the 10 December session
of the Geneva disarmament con-
ference, the Soviet delegate sur-
faced Moscow's proposal for using
unmanned, automatic seismic
stations ("black boxes'') to police
a nuclear test ban. The proposal
had been given initially to Am-
bassador Dean by First Deputy
Foreign Minister Kuznetsov during
a private conversation of 7 No-
vember in New York.
Tsarapkin announced publicly
for the first time three seismic
areas in the USSR where the "black
boxes" might be placed. He sug-
gested Kokchetav in Central Asia,
Bodaibo in the Altai zone, and
Yakutsk in the Far East.
The Soviet leaders may be
preparing to declare another
unilateral moratorium on Soviet
testing to go into effect at the
first of the year. They will
probably delay such an announcement
until the current Soviet series is
completed.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Peiping's demand for an
end to Indian stalling on Chinese
proposals for negotiations and
Nehru's prompt response reject-
ing Peiping's key provision
for mutual withdrawal coincided
with the opening of the six non-
aligned nations' conference in
Colombo on 10 December. The
exchange between the two ad-
versaries and Peiping's re-
current charges of renewed
Indian provocation have moved
the dispute one notch closer
to a resumption of fighting.
The strident tones of
Peiping's Foreign Ministry
statement of 8 December and its
memorandum to the Indian Govern-
ment on the following clay appear
to have been calculated to convey
to the Colombo meeting and to
the nervous Indians the impres-
sionthat Chinese patience is
wearing thin. The Chinese de-
manded an early positive re-
sponse to their oft-repeated
proposals, reminding New Delhi
that Indian agreement to disen-
gagement and acceptance of the
1959 "line of control" as de-
fined by Peiping was the "key
issue" for termination of the
border conflict and a resump-
tion of negotiations. New
Delhi is advised to take "the
proper measure of itself" fol-
lowing the "heavy blows" dealt
by Peiping's armed forces.
In his reply on 10 December
Nehru read a carefully prepared
statement to Parliament--an
unusual procedure for him.
He told his listeners in the
chamber as well as in Colombo
and Peiping that, while New
Delhi had "accepted" the cease-
fire, it was a unilateral
Chinese gesture which required
no Indian "agreement." He
further stated that Peiping's
mutual withdrawal proposals based
on China's rendition of its line
of control of November 1959 were
unacceptable to India and that
negotiations under the present
circumstances would serve no
useful purpose.
He reiterated the Indian
call for a pullout by the Chinese
from all positions occupied by
them since they initiated this
military phase of the border
conflict on 8 September 1962.
The principal advantages to
India of this demand are that
it would restore Indian presence
in about 2,000 square miles of
Ladakh, would bring Indian forces
back to the Indian version of
the McMahon line in the north-
east (differing only marginally
from the Chinese variation),
and would not require India to
demilitarize a 12.5-mile-wide
strip on its side of the whole
border, even those portions where
no fighting has occurred this year.
The Colombo meeting, to
which both sides gave considerable
attention, adjourned on 12
December, apparently without
accomplishing much. The
principals conducted them-
selves essentially in accordance
with their advance billing, and
none showed any interest in
dealing with the substantive
issues of the Sino-Indian dis-
pute. Rather they seemed most
intent on ensuring that the
cease-fire not break down and
that negotiations on any basis
acceptable to the adversaries
be initiated. Ceylonese Prime
Minister Bandaranaike, hostess
for the gathering, will visit
both New Delhi and Peiping to
convey the conference's pro-
posals.
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P hankot
Thoise
1 Y4 I R Leh r P
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PANGONI
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C7LI/1&IbTT
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CURRENT INTELLIGENCE WEEKLY SUMMARY
77'' _
SECRET
EASTERN SINO-INDIAN BORDE:R AREA
w
E
S
Boundary shown on most US and Western maps
-..- Demarcated
X- Delimited only
Indefinite
Boundary shown on. recent Chinese and Indian maps
(where differing from US and Western maps)
Chinese
Indian
Airfield
Road W Pass
Major caravan route .25645 Spot height
or trail (in feet)
Ghn
a~ *cs
t j9napur
~t ,--- ?'?- 'USA SIR`I
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Zir@@ng [
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50 100 Miles
I 1
50 100 Kilometers
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Some Indian officials have
expressed apprehension that
Peiping will renew its military
offensive as a result of Nehru's
rejection of the Chinese pro-
posals. Pqiping's initial re-
action to Nehru's statement,
while the Colombo conference was
under way, was not to interpret
it as a flat rejection but
rather to play up Indian ac-
ceptan of the cease-fire and
Indiaigreement to the concept,
at least, of disengagement.
While the Chinese also
took note of the negative
aspects of Nehru's remarks,
they implied that Indian actions
so far had not gone far enough
to warrant calling off the
cease-fire and troop withdrawal.
At the same time, the Chinese
continue building a case for
themselves should the cease-
fire break down.
Peiping has highlighted
the second stage of its phased
withdrawal, which got under
way on 9 December. The Chinese
are pulling back from :Bomdila
and other points in the North
East Frontier Agency (:NEFA).
There is still no confirmation
of Chinese troop withdrawal in
the Ladakh area, although the
Chinese on 8 December announced
that Demchhog and several other
positions would be abandoned.
Peiping has yet to indicate
when the entire withdrawal from
positions overrun in its "self-
defense strikeback" will be
completed.
On the other hand, the
Chinese have demanded an "im-
mediate" end to alleged provo-
cations by Indian troops and
pla]aes. A sharp Chinese pro-
test note on 11 December charged
the Indians with renewed air in-
trusions over Chinese territory.
The Chinese also claimed that
Indian troops had "repeatedly"
pressed forward against Chinese
forces and crossed the line Peiping
insists should be used to estab-
lish a demilitarized zone.
Implicit in Peiping's re-
cent statements is the warning
that the Chinese might have to
reconsider their unilateral
commitment to a cease-fire and
pullback. Some recent Chinese
remarks on NEFA could be read
as suggesting that territory
claimed by the Chinese there might25X1
be seized and held in its entirety
if Peiping is pushed too far.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The USSR's 1963 plan and
budget announced on 10 December
in the Supreme Soviet show no
change in Soviet planners' em-
phasis on heavy industry. The
program also gave considerable
lip service to the needs of
agriculture and the consumer
but provided for, at best, onl
modest improvements in 1963.
The planners apparently
adopted a cautious approach to
the formulation of most, 1963
industrial targets. There are
few major policy shifts, and
most growth rates are shaded
downward from the 1962 plan.
This apparent caution may re-
flect mounting difficulties in
the allocation of resources.
The budgetary presentation
appears to be fairly routine.
Since the Soviet budget is the
principal accounting document
for much of the economy, its
over-allincreases year by year
reflect the growth of the econ-
omy. In the Soviet Union, each
new budget is larger than that
of the preceding year.
Military Expenditures
The usual sparse informa-
tion in the budget on defense
spending indicates no extra-
ordinary effort in that direc-
tion. Explicit military expend-
itures are only slightly higher
(4 percent) than last year, al-
though military-related, items
continue to be hidden in budget
categories other than "defense.
There is no budgetary indica-
tion, however, that Khrushchev
has responded to the Cuban de-
velopments by sharply stepping
up military outlays.
Finance Minister Garbuzov
characterized the current atti-
tude with: "These appropria-
tions insure the maintenance of
Soviet armed forces on a proper
level."
Industry
The most interesting indus-
trial production target is that
for crude steel, which is to in-
crease at the lowest rate of any
year since the start of the
Seven-Year Plan in 1959. This,
together with the probable under-
fulfillment of the 1962 goal,
raises some doubt that the
Seven-Year Plan steel objective
will be met.
Soviet planners may have
decided on this course in re-
sponseto Khrushchev's recent
SOVIET BUDGET
(PLANNED)
Turnover Tax
2.5
33;8
profit Deductions
23.2
26.0-
State Taxes on the Population
6.3 6.3
6.3
Stole Taxes on Organizations
1.3
N.A.
State Loans
1.1
1,1"
Social Insurance Receipts
Other
Total
13,3
N.A.
EXPENDITURES
ExplicitDefense
9.25/12.40ae
13.4
13,.9
Administration
Financing the National Economy
Industry
16,1
14.9
N. A.
Agriculture,
4.2
5.1
N.A.
Transport and Communications
2.5"
2.5
Residual
11.1?
10.1
N.A
Social- Cultural Measures
(Includes science)
31.0
Estimates
Including the additlonbi allocation referred to by Khrushchev on 8 July 1961.
According to calculations based on Soviet data, the actual 1961 explicit
defense expenditure was 11,86 billion rubles.
s2 iliac - - -
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CURRENT INTELLIGENCE WEEKLY SUMMARY
INDUSTRIAL PRODUCTION IN THE USSR
(PERCENT OF INCREASE OVER PRECEDING YEAR) '..
1958
1959
1960
1961
1962
1963
OFFICIAL SOVIET
ANNOUNCEMENTS
Plan
7.6
7.7
8.1
8.8
8.1
8.0
Actual
10.0
11.4
9.6
9.2
9+
-
CIA ESTIMATE OF
ACTUAL INCREASE
8.6
10.4
6.9
7.6
It Is believed that the official Soviet plan figure for gross value of Industrial output Is
almllar In concept and coverage to the CIA estimate and does not reflect the usual blame
of the official Index of actual industrial growth. These biases result from the inclusion
of activity other than the output of finished goods--semifabrlcates, unfinished production,
and capitol repair. Biases also result from overpricing of n w products, and a strong
Inclination In the industrial hierarchy to exaggerate the level of output.
USSR: SELECTED INDUSTRIAL PRODUCTION
1961 1962 1963 1965 PERCENTAGE INCREASE
PLAN . ACTUAL PLAN ACTUAL PLAN TARGET 1961/1960 1962/1961
PIG IRON (million metric loos) 51.2 50.9 56 55 * 59+ 72-73 8.7 8
STEEL 71.3 70.8 76.9 76 * 80 95-97 8.2 7.5
OIL 164 166.1 185.0 186 * 205 240+ 12.2 12.3
ELECTRICITY (bllllon kllawait hours) 327+ 327.6 366.0 367 * 408 525* 12 12
MINERAL FERTILIZER (million metric tons) 15,3 15.3 17.2 17.2 20 37.7 10.0 12
TRACTORS (thousand units) 268.0 263.6 294.2? 288 * 325 450 10.7 9
25X1 ?d
621212 .
call for reduced emphasis on
steel in favor of chemical sub-
stitutes. The steel growth-rate
reduction may also mean--as long
implied by Khrushchev-?-that the
forced growth of the steel in-
dustry is no longer necessary
for expanding the military es-
tablishment.
A major concern of the
Soviet plan report was the lag-
ging chemical industry, but
there was little to suggest that
major improvements would be
forthcoming. The 19621 increase
planned for the output: of chem-
icals--17 percent--is about the
same as expected 1962 peform-
ance and well above that of
earlier years of the Seven-Year
Plan. It is, however, inade-
quate in terms of the plan's
goals.
Individual chemical produc-
tion plans for 1963--for fibers,
1963
PLAN
7.2
S
10
II
16
plastics and resins, and mineral
fertilizers--appear feasible
but well below rates needed to
meet 1965 goals. Investment
for the chemical industry is
planned to increase by nearly
one third, but judging by per-
formances of the past several
years the plan will probably not
be met.
Plans concerning the con-
sumer portend little change in
the present trend of continuing
but slight improvement in the
standard of living. Production
of consumer goods is to increase
at the lowest rate since 1959,
although only slightly below
last year's target.
The rapid development of
additional capacities in light
industry is presented in the
plan as a major objective, but
this does not mean very much.
Past plans have carried similar
ambitions which in practice
have not been achieved.
Probably the greatest
single disappointment in the
plan for the Soviet public is
the goal for urban housing--
since World War II,, a pressing
need. The very modest housing
plan for 1963 in the face of
substantial underfulfillment
of annual goals since 1959 in-
dicates that the Soviets have
virtually abandoned their
Seven-Year Plan goal for housing
That plan now can be fulfilled
only if the Soviets should re-
vert in 1963-65 to the high
economic priority which was ac-
corded to housing during 1957-59.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
STAT
SOVIET URBAN HOUSING
CONSTRUCTION
(MILLIONS OF SQUARE METERS)
1958 59 60 61 62 63 64 65
- Planned, as implied by Seven-Year Plan and earlier decree
Actual 1958-1961; Forecast 1962; Planned 1963
Required in 1964 and 1965 If Seven-Year Plan is to be achieved
Agriculture
representing any real increase
in total agricultural invest-
ment.
Competition for Resources
Soviet planners appear
still to be grappling with the
problems generated by the grow-
ing competition among the con-
sumer, investment, and the
military establishment for re-
sources. Space and new-weapons
programs have taken an increas-
ingly large share of the output
of the machine building indus-
tries, with a parallel drain on
scientific, engineering, and
technical manpower of the high-
est quality. Many of these
same resources are needed for
modernization and technological
improvement in industry, and
for a higher output of equip-
ment and chemical products.
The resulting competition
has led to an increase in sup-
ply problems and to what seems
Data on agricultural invest- to be a rather sharp drop in
ment in the reports is sketchy the growth rate of investment
but it appears that no major since 1960, Investment in 1963
increase in support for agri- may recover somewhat, but the
culture is planned. The an- presently available plan and
nounced increase in state in budget data are too incomplete
vestment--18 percent--will do to be conclusive. Khrushchev's
little more than provide for recent reorganization :)f the
ann
d
i -__-_... J f
ounce
a L the r(ovem-
system, which has been expand- ber central committee plenum,
ina ran1d1v throu
h the
g
rro oblle e msw ` ?'to ease znese
Sion of collective farms to p"roble"ms"""
.
In 1958 collective farms
comprised over two thirds of
total sown acreage,while in
1962 their share had been re
duced to about one half. Col-
lective farms invest from their
own earnings and are not ac-
counted for in the state budget.
Thus their conversion to state
farms places an additional bur-
den on state financing without
The answer embodied in the
1963 plan and budget--judging
from the very limited informa-
tion revealed publicly--appears
to be a slowing of the rate of
expansion of consumer programs
and a concurrent attempt to
carry the heavy industrial de-
velopment and military programs
forward at acceptable rates
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CURRENT INTELLIGENCE WEEKLY SUMMARY
CZECHOSLOVAK PARTY CONGRESS
The C?echoslovak party's
12th congress--postponed for
two months to enable dogmatic
first secretary Novotny to si-
lence his opposition--was held
from 4 to 8 December and. was
used by Novotny to demonstrate
his renewed authority. He con-
tinued his refusal to institute
de-Stalinization in Czechoslo-
vakia, but nevertheless reaf-
firmed his fealty to Moscow by
identifying his regime with
Khrushchev's "anti-Stalinist"
policies on such issues as China
and Yugoslavia. Specific solu-
tions to the country's economic
problems, also a cause of party
and popular disaffection, were
postponed until the new Seven-
Year Plan is completed in 1963,
a decision that can only serve
to exacerbate the disaffection.
Novotny has been particu-
larly sensitive to criticism
from certain party elements of
his conduct of internal affairs
since the 22nd Soviet party con-
gress in November 1961. He ad-
mitted at the Czech congress
that "not a few comrades" in
the Czech central committee had
objected to his whitewash of
Stalinist practices at that
time and to his placing the
blame on deceased leaders
Slansky and Gottwald.
un-
like the situation at the recent
Bulgarian and Hungarian congresses,
no move was made in Prague to
institute a meaningful de-
Stalinization program. The few
changes in leadership at the
congress (see chart) are sym-
bolic of Novotny's determination
to maintain the status quo.
While this gives the appearance
of solidity around Novotny and
will do much to restore his
public image as an unchallenge-
able leader, it also means he
has made no meaningful concession
to those in the party who oppose
him.
In what appears to be
Novotny's maximum sop to those
seeking redress of past injustices,
Prior to Opening of
Decsmber Congress
Karol Bacilek ...... .,.,s ......... Bacilek
Pavel David
Joromir Dolonsky............................ .......... Dolansky
Zdenek F erlinger ...... ......... ....... .. Fierltnger
Jiri Hendrych ....................... .... ......... Hendrych
Antonin Novotny .....:. ......... .......... Novotny
Otakar Simunek ....; ... Simunek
Viliam Siroky ........ Stroky
* Drahomir Kolder
* Josef Lenart
Since then, Novotny has
managed to convince most of
his critics that for the time
being there is no alternative
to his course, and has intimi-
dated others by jailing the
leader of a potential opposition
group, former Interior Minister
Barak. As a result of these
steps his political prestige
suffered immensely, as is illus-
trated by constant country-wide
rumors of his impending down-
fall.
Jan Hlina
Ludrrila Jankovcova: ....... .......... Jankovcova
Drahomir Kolder
Bruno Koehler
* Alexander Dubcek
* Antonin Kopek
Antonin Novotny......... First Secretary........ Novotny
Alexander Dubcek....... Secretary
Jiri Hendrych ......... Secretary .......... Hendrych
Brunc Koehler ..........Secretary .......... Koehler
Vladimir Koucky.......... Secretary ... Koucky
Vaclov Slavik .......... Secretary ......... Slavik
* Drahomir Kolder
+Forrnerly Politburo
*Newly elected
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CURRENT INTELLIGENCE WEEKLY SUMMARY
the congress approved. a review
within the next four months of
all the 1949-1954 political
trials except "Slansky's and
some others." The congress also
decided to re-examine the cases
of 20 former party functionaries
who had appealed their expul-
sion. Barak's case will not
be included.
The congress served as
a now-familiar battleground for
polemics between the Chinese
and. most of the parties repre-
sented. The Czech leaders'
support of Khrushchev appears
designed in part to quiet fre-
quent reports of clandestine
support for Chinese policies
within the Czech party.
Novotny admitted to the
congress that his ambitious
program for rapid industrial
growth had suffered serious set-
backs, and he made no mention
of his earlier proposals for
vast institutional changes in
agriculture that would, have
made collective farms operate
like huge state-owned farms.
The economic speeches :Lacked
the buoyancy and optimism
usually expressed at party con-
gresses. Proposed. solutions to
problems were discussed only in
general terms, even though the
speakers were obviously concerned.
with the growing economic diffi-
culties of the past two years--
caused by unrealistic planning,
inadequate coordination of sup-
plies in industry, and a poor
performance in agriculture.
The party's decision to
reinstitute centralization of
economic management and control
will greatly increase the re-
sponsibilities of the industrial
ministries over investments and
the distribution of. materials.
A larger role was prescribed, for
the party in the administration
of agriculture.
The need to increase agri-
cultural production was stressed,
but no positive steps were pro-
posed to improve farmers' in-
centives nor is there any indi-
catiLon that agriculture will re-
ceive a high priority in the
distribution of investments.
The congress resolutions followed
last; July's central committee
proposals for the adoption of
more realistic plans for in-
dustry through decreases in the
annual rates of growth for
production and. fixed investments.
Consumers were promised no relief
in the next year or two and only a
small improvement in the standard
of living by 1970
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CURRENT INTELLIGENCE WEEKLY SUMMARY
ULBRICHT PREPARES FOR PARTY CONGRESS
As the time approaches for
East Germany's sixth party
congress--scheduled for mid-
January--party leader Ulbricht
is attempting to recast the
image of himself and his party
in the light of current Soviet
positions on peaceful coexist-
ence and de-Stalinization.
It is clear, however, that his
efforts to impress on hard-line
party functionaries that tacti-
cal retreats--- "compromises "--
such as those on Berlin and
Cuba are necessary under cer-
tain circumstances are con-
strained by fear that such
statements may encourage the
population to demand :Further
relaxation of controls.
During the past two weeks,
district organizations of his
Socialist Unity Party (SED)
have been electing delegates
to the congress. Ulbricht has
attended two of these sessions--
at Cottbus on 2 December and
Leipzig on the 9th--arid warned
party officials that they must
avoid "dogmatic and sectarian"
procedures which create public
hostility and jeopardize the
fulfillment of economic objec-
tives. At Cottbus--where the
district leadership has con-
fessed publicly to "sectarian"
acts of an undisclosed nature--
Ulbricht lectured officials on
the evils of intransigent po-
sitions on international prob-
lems, in answer to criticism
of Soviet policy on Cuba and
Berlin.
It is clear that many hard-
line party elements favor the
uncompromising Chinese Commu-
nist approach on both issues.
In connection with recent Com-
munist Party congresses, the
East Germans have avoided tak-
ing any explicit public position
on the issues, but the regime
press has quoted condemnations
voiced by Soviet and other
Communists. Even the important
12 December Neues Deutschland
article by Ulbricht's henchman,
Hermann Axen, while aligning the
SEI) squarely with Khrushchev,men-
tioned neither the Chinese nor
the Albanians by name, but
criticized the views of "certain
dogmatists" and "sectarians" who
have questioned Soviet policy.
Axen's argument, like Ulbricht's,
is directed at proving that,
just as compromises were needed
in Cuba, "so also the struggle
for peaceful coexistence between
both German states and for a
German peace treaty indispu-
tably requires compromises
which correspond to the correla-
tion of forces and the interests
of peace."
Ulbricht is personally
taking the lead in a de-Stalin-
ization campaign, closely con-
trolled to prevent any loss of
party authority. As chairman
of the State Council, he re-
cently introduced a draft de-
cree designed to end certain
judicial abuses, which he blamed
on "the Stalinist personality
cult." The draft is to be sub-
mitted to public discussion, with
a report due to the State Coun-
cil?--i.e.,? Ulbricht--by 15 March.
His remarks may be intended to
set the stage for the removal
or retirement of judicial offi-
cials, perhaps including Minis-
ter of Justice "Red" Hilde
Benjamin.
In agriculture, party of-
ficials have been warned to give
their main attention to food
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production and avoid "dogmatist"
emphasis on legalistic changes
in organization of collective
farms.
The problem of securing
food production may lead to
high-level personnel changes.
Major changes planned in
the regime's economic apparatus
will probably be reflected at
the congress.
The changes,
which pro ably will resemble
those now being made in the USSR,
doubtless will also involve ex-
tensive personnel shifts and pro-
vide an opportunity to make scape-
goats of unpopular or inept of-
ficials.
Neues Deutschland recently
began calling for new approaches
to economic problems in line with
Ulbricht's suggestion in October
that East Germans should study
Soviet ideas on the subject. Econ-
omists and technicians met in
East Berlin on 6-7 December in an
attempt to find new answers.
TOP LEADERSHIP OF THE EAST GERMAN SOCIALIST UNITY PARTY AND GOVERNMENT
STAT
POLITBURO SECRETARIAT COUNCIL OF MINISTERS' PRESIDIUM
(11 members) (8 secretaries) (13 members)
ULBRICHT* ------------- ULBRICHT
GROTEWOHL-------------------.----- GROTEWOHL (premier)
STOPH------------------------- STOPH (first deputy premier)
EBERT
HONECKER------------ HONECKER
LEUSCHNER-------------------_ ---- LEUSCHNER
MATERN
MUECKENBERGER
NEUMANN---------- -- NEUMANN-------NEUMANN
NORDEN---------- - -NORDEN**
WARN KE
APEL --------- --------------APEL
BAUMANN-------_-_-- BAUMANN
ERMISCH
FROEHLICH
GRUENEBERG ---------- GRUENEBERG----- ---GRUENEBERG
HAGER----------_--- HAGER
KURELLA
MEWIS------------ --------- ---- MEWIS
PISNIK
VERNER-------------VERNER
* Ulbricht, while no longer a member of the council of ministers, is chief of
state as chairman of the State Council.
** Although Norden remains a member of the secretariat, Neues Deutschland editor
Hermann Axen has assumed an increasingly important role ira recent months.
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Neues Deutschland even front-
page a picture-of Fritz Behrens,
an economist who had been accused
of "revisionism" in connection
with the fall of Ulbricht's lead-
ing opponents Schirdewan and
Oelssner in 1958.
These indications of change
have caused uneasy stirrings
among party members. Neues
Deutschland last month went out
of its way to answer a question
posed by certain party members
concerning a provision for "party
democracy" in the new SED draft
statute. This section had been
lifted from the Soviet party
statutes but without the clause
calling for systematic rotation
of the membership of party organs.
Neues Deutschland explained the
omission in terms of the greater
experience of the Soviet party,
stressing that the East German
draft for the first time guar-
antees party members the right
to discuss "all questions of
party policy openly and soberly
in party organization meetings."
These recent developments
taken in toto suggest that there
may be major changes in the
party at the forthcoming con-
gress, possibly even including
steps to pave the way for Ul-
bricht's retirement. Moscow,
for example, may consider that
his Stalinist background is a
liability to its efforts to gain
recognition for his regime and
may insist that he give up his
position as party first secre-
tary while letting him continue
as chairman of the State Council.
Ulbricht's activities in build-
ing up his image as de-Stalinizer
and party theoretician may have
been calculated to establish his
character as an elder statesman
with this in mind.
The appointment of Petr
Abrasimov as Soviet ambassador
last week suggests that the USSR
wishes to have an emissary of
proven flexibility in Pankow
at a time when changes in the
party leadership and tactics
are in progress. Abrasimov's
experience as Soviet ambassador
in Warsaw during the critical
early years of Gomulka's return
to power would appear to be an
excellent preparation.
Foremost among those
thought to be contenders for
Ulbricht's post as first secre-
tary: is Erich Honecker, the only
man so far publicly designated
for an important role at the
congress. One of the founders
of the Communist youth organ-
ization, the Moscow-trained
Honecker has been central com-
mittee secretary for security
matters since February 1958.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
THE MACMILLAN - DE GAULLE MEETING
Macmillan'.s two-day visit
to Paris beginning on 15 Decem-
ber coincides with the deci-
sive phase of the UK-EEC talks
in Brussels and with increased
European preoccupation with the
future course of European-
American ties.
will be hoping to return from
Paris and from his subsequent
talks with President Kennedy
with a strengthened hand. De
Gaulle probably sees the talks
as another opportunity to re-
cord his view that, despite a
relative respite in East-West
relations, the fundamental
Soviet position on important
international issues remains
unchanged and that Western
strength and patience remain
the best way of dealing with
the USSR. He may also take
the opportunity to tell Mac-
millan that France would not
be bound by US-UK agreements
reached on these issues without
French participation.
Ithe view
that the accession talks have
reached the point where a "pack-
age deal" could be put together
if the "political will" to do
so existed. This view tends
to slight the fact that the
technical issues in Brussels
involve major national interests,
as is evident in the rigidities
on both sides over Britain's
agriculture and its commitments
to the Outer Seven. Moreover,
while France has taken the
toughest line with Britain, it
has been able to do so only
when the other EEC members were
also convinced that "community
integrity" was at stake.
These circumstances are
in part the source for renewed
speculation in both countries
that Macmillan may be tempted
to offer France "something"
outside the EEC framework--e.g.,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
25X6 closer cooperation in defense
in general and in nuclear wea -
ons in particular.
the 1JK enters the EEC, "the US
is prepared to help create a
multilateral European nuclear
force, controlled by European
powers and linked in some form
with the American deterrent."
While it is doubtful that
either London or Paris has
thought very far ahead about
the military implications of
Although De Gaulle would Britain's entry into the European
probably approve an extension community, there are other reasons
of French-British military for believing this may prove a
cooperation, his views on the more current topic than it did
need to maintain national con- in June. In reviewing, as they
trol of the French nuclear force
are firm, and he would probably
not be receptive to proposals
leading toward either a joint
French-British force or inclu-
sion of French weapons in a
European force.
However, indicative of how
far speculation along such lines
has now gone, the London Times
declared in a feature article
on 7 December that it "can be
said with certainty" that if
apparently intend to do, the
Cuban crisis and the Sino-Indian
conf7!_ict, Macmillan and De
Gaulle will be more aware than
ever of the limited power of
European nations individually.
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The revolt of the "North
Borneo National Army," launched
on 8 December to establish an
independent state outside the
proposed Federation of Malaysia,
collapsed after a few days of
disturbances in the British
protectorate of Brunei.
The revolt exposed foreign
involvement with the opponents
of federation. Indonesia trained
and supported the rebels; the
Philippines provided asylum and,
a public rostrum for the absen-
tee rebel leader, Azahhari; and
Singapore's Barisan Sosialis
Party and Malaya's Pan-Malay
Islamic Party offered moral
support.
Azahari's claims of wide
Bornean popular support fizzled.
The Sultan of Brunei immediately
denied that he sponsored the
movement, as Azahari had an-
nounced. Sarawak and North
Borneo leaders who he hoped
would join him in a delegation
backed out,and at the outbreak
of the revolt denounced Azahari's
use of force. Azahari's own
visit to the UN has been jeop-
ardized., as the British have
canceled his passport.
The British have attempted
to treat the whole affair as a
police, rather than a military,
action. The necessity to use
military force, however, under-
scores the difficulties which
may beset the future federation,
and indicated the degree to
which its stability will depend.
upon the continued presence. of
British units after its estab-
lishment--now set for 31 August
1963.
At the outset, Malayan
Prime Minister Rahman was par-
ticularly angry at the Philip-
pine Government for its appar-
ent backing of Azahari. A
break in diplomatic relations
was threatened. On 11 December,
however, he publicly absolved
both President Macapagal and
Philippine Foreign Minister
Pelaez of duplicity and directed
his anger against Djakarta.
The day before, President
Sukarno had publicly implied
his support for the rebellion.
He stated that the rebellion
in Brunei "has something to do
with new emerging forces and
the movement will come out as
victor."
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CURRENT INTELLIGENCE WEEKLY SUMMARY
TENSIONS CONTINUE IN LAOS
Despite the recent agree-
ment among Laos' rival factions
on military and police integra-
tion and signs of increased
bloc support for the coalition
government, factional tensions
continue to impede progress to-
ward national reunification.
A serious threat to the
coalition is the continued
erosion of Premier Souvanna's
strength among the neutralists.
His failure to discipline left-
wing neutralists who shot down
a US-chartered aircraft resup-
plying neutralist forces on the
Plaine des Jarres showed his
lack of effective control over
these elements.
Souvanna also appears to
be encountering the active
opposition of Quinim Pholsena,
his "neutralist" foreign minis-
ter, whose left-wing inclinations
have become increasingly evi-
dent. Quinim recently charged
Souvanna with abandoning neu-
tralism and joining the rightists.
The loss of Quinim's nom-
inal support could hurt Souvanna.
While Quinim is not popular with
the masses, he commands signif-
icant backing from important
student and religious groups.
Pathet Lao leader Souphannou-
vong stated on 3 December that
Quinim now is really with the
Pathet Lao and will stay with
them.
The Pathet Lao appear
determined to prevent any
effective investigation by
International Control Commission
teams of charges of foreign
troops remaining in Laos. Al-
though the Pathet Lao have
agreed to the inspection of
two sites where violations had
been alleged--one near Ban Houei
Sai and the other close to Sam
Neua town--they have insisted
that the inspections not last
longer than 24 hours, and that
the teams operate only within
a two-kilometer radius of the
designated inspection site.
The rightists recently have
given indications that they were
prepared to acquiesce--at least
in major part--to the Pathet Lao
demands. They had been pressing
for a five-day inspection period,
with the right to conduct in-
vestigations within a radius of
ten kilometers.
Both the USSR and Communist
China have moved to assist the
coalition government. In Moscow,
General Phoumi concluded a two-
million-dollar trade pact, re-
ceived assurances that long-
term credits would'be forthcoming
for the construction of a hydro-
electric station, and was
promised a gift hospital and
radio station for Vientiane.
In early December the
USSR delivered ten aircraft--
nine transports and a helicopter--
to the Souvanna government,
together with crews and neces-
sary maintenance personnel.
Peiping-, for its part,
granted long-term credits for
industrial construction and
promised to consider a Laotian
request for further road con-
struction in northwest Laos.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
FIGHTING IN YEMEN INCONCLUSIVE
Inconclusive fighting be-
tween royalist tribesmen and
Egyptian and Yemeni revolution-
ary forces in northern and east-
ern Yemen is continuing. A num-
ber of villages and military
posts have changed hands, but
neither side appears to have sig-
nificantly altered its position.
~llxlPU J1,11
4
KAMARAN
(U.K.) ;,-
Pro-rebel forces made gains
during the past few days in the
area north of Sadah, and they
have somewhat strengthened their
position in the al-Javvf area,
east of the Sana-Sadah road. How-
ever, they have lost to the roy-
alists the mountain fortress of
Washha, southeast of Farad.
Al H"uda d
ADEN
+--.-,~ OF A!JAN
32858
Royalist elements, in an ef-
forrt to stave off US recognition
of the revolutionary regime, have
been making exaggerated claims
of military successes. However,
the royalists control approxi-
mately the same area they have
controlled since the revolt be-
gan--a narrow band of territory
in the north along the Saudi
border and a wider band extend-
ing roughly from the Saudi bor-
der south of Najran through part
of the al-Jawf area, and the vil-
lage of Marib, to the Aden pro-
tectorate border. In addition
they hold a number of pockets in
the mountains north and north-
west of the town of Sadah. They
have also been able, by temporary
incursions, to. put pressure on
the revolutionaries in the area
south of .Sadah and have on sev-
eral occasions interfered with
land communications between Sana
and Sadah.
The UAR is continuing its
substantial assistance to the
revolutionary regime.
STAT
SECRET
Major road
Q'Flt~@r?`road or track
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CURRENT INTELLIGENCE WEEKLY SUMMARY
INSTABILITY IN TURKEY
Political stability in
Turkey is again threatened by
recurrent factionalism both in
the governing political party
and in the air force.
Premier Inonu's Republican
Peoples Party (RPP), the major
one in the coalition government,
appears badly split on the eve
of its national party congress
from 14 to 16 December. Anti-
Inonu activity was evident at
local RPP congresses held ear-
lier this fall. Inonu's lead-
ing opponents in the party,
former RPP secretary general
Kasim Gulek and former cabinet
ministers Nihat Erim and Avni
Dogan, were united under Gulek's
leadership. Spokesmen of this
group criticized both :[nonu's
party leadership and the gov-
ernment's policies.
Although Inonp had in the
past been rather tolerant of
intraparty criticism of his
actions, he saw the present
movement as a threat. On 9
December
the RPP's disci-
plinary council suspended Gulek,
Erim, and Dogan from all polit-
ical activity for a year for
"violating party statutes."
Inonu's tactics will de-
pend on whether he can retain
control of the RPP's 40-man
governing board, which is to be
elected during the congress.
With national elections still
more than two years away Inonu
may feel that now is the best
time to meet the challenge to
his party leadership.
The situation within the
air force appears outwardly to
have returned to normal following
the sudden removal of 11 senior
officers from their posts by air
force commander Tansel on 3 De-
cember.
erate policies.
Opposition to Tansel with-
in the air force may be due in
part to his strong support of
Inonu and the government's mod-
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CURRENT INTELLIGENCE WEEKLY SUMMARY
CONGO
Adoula's parliamentary op-
ponents appear to be moving
rapidly to a showdown with the
government. On 7 December they
censured Adoula's minister of
justice. They also introduced
a motion, yet to be voted on,
to "suspend"the UN plan for
Katangan .reintegration, appar-
ently believing this may force
Adoula to resign.
Ambassador Gullion believes
that it is only a question of
Adoula's close supporters
continue to express concern that
he will be overthrown and to
ta:Lk in terms of mounting a pre-
ventive coup to maintain him
and themselves in power. Ap-. 25X1
parently they are uncertain as
to what to do or when,to act,
'however.
time before a new motion of cen- are mounting a strong pressure
sure is introduced against the campaign against Tshombd with
government. More opposition I implied threats of ultimately.de-
deputies are returning to Leo- straying him if he does not im-
poldville. . plement the UN plan soon. In
The opposition attacks have
produced confusion in government
ranks. J
Gullion describes the governmen
as like a bird watching a snake,
paralyzed into inaction and.
getting weaker with each vote
against it.
a letter of 1.0 December, UN
Congo chief Gardiner informed
the Katanga leader that the UN
regarded him as primarily re-
sponsible for nonimplementation
of the UN plan and that'U Thant
would therefore move on to more
drastic measures.
Gardiner denied the UN
would engage in offensive mili-
tary action, but stated that the
UN forces would insist on com-
plete freedom of movement through-
out Katanga. The letter called
on Tshombd to halt his bombings
of Congo Army forces in North
Katanga, to lift his blockade
of UN supplies at the border
towns of Sakania and Dilolo,
and to remove all Katangan road-
blocks iq the Elisabethville
area.
Thant, in New York, is
now appealing to Western Euro-
pean governments and to Washing-
ton for an embargo on Katangan
copper and cobalt, for Union
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Miniere to stop its mineral ex- I and that the grounds for such
port tax payments to Tshombd,
and for countries bordering on
Katanga to ban transit of Ka-
tangan mineral shipments through
their territories.
A reliable UN source told
US Consul Dean in Elisabethville
that the recent meeting of the
UN military command at Kamina
was to "review the final plans
for military action in Katanga,"
action would be Tshombd's re-
fusal to permit freedom of move-
ment to UN forces in Katanga.
This-source indicated that moves
in this direction would be under-
taken when the UN force received
bridging and other equipment it
now lacks.
Tshombd has continued to
defy suggestions that he imple-
ment the UN plan. He is ready-
ing himself for any UN moves,
building up his troop and
equipment strength. He has
reinforced the rail exit point
at Sakania and probably also
at Dilolo. A senior UN official
claims that the Katangans are
using airfields in eastern Angola,
and that Dilolo has now become
Katanga's main supply base.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
ALGERIAN REGIME MODERATES NEUTRALIST STANCE
The Ben. Bella government
in Algeria is assuming a more
balanced posture in foreign
affairs. It apparently has
concluded that its best hope
of survival lies in collabora-
tion with the West, although
its bid for economic aid from
any quarter still stands.
Foreign Minister Khemistild
amicable consultations in Paris
late last month secured interim
financial assistance covering
the rest of this year and paved
the way for negotiations on
French financial, cultural, and
technical assistance agreements.
Simultaneously, the government
has moved to silence potential
critics of this Westward trend,
most notably by banning the Com-
munist Party and its official
press. Belkacem Krim, Ben
Bella's most powerful opponent,
has endorsed the regime's ef-
forts to obtain Western assist-
ance.
Algerian leaders, partic-
ularly Khemisti and even Ben
Bella himself, have indicated
acute embarrassment over .the
premier's visit to Havana in
October and have toned down
their extravagant praise of
Castro and Communist China.
These officials have become
aware of popular disinterest
in Cuba and of a widespread
belief that support for Castro
succeeded only in distracting
Algeria's leaders from attempts
to solve their. own country's
problems.
French and American of-
ficials. were the only foreign
guests invited to the opening
of the Oran medical school,
even though there are many
Bulgarian and Polish doctors
in the country.
The UAR is acting to main-
tain its influence with Ben
Bella. On 6 December Cairo
announced 'the grant of a $24
million interest-free loan re-
payable over .a 12-year period.
This loan is to be used to
purchase goods and services
in Egypt.
Ben Bella has taken steps
to cut administrative expend-
itures, beginning with official
salaries. He also has told
the American ambassador-desig-
nate that he intends to reduce
the army from its present 100,000
men to an elite corps of 25,000.
He will not do this soon, how-
ever,.in view of the continuing
high rate of unemployment, the
tenuous security: situation, ,
and the prevailing dissatisfac 25X1
tionamong local officials with
the regime's performance to date.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The economic team headed
by new Minister of the Economy
Mendez Delfino must contend
with serious economic deteri-
oration in Argentina and is
unlikely to achieve quick
results in stemming the long
and worsening downward
trend in key sectors of the
economy. Without such results
the political situation could
again become explosive.
Mendez De.lfino is an ortho-
dox economist with considerable
experience in public office and
private industry. He has served
as governor of the International
Monetary Fund, secretary of
the Treasury,. president of the
Central Bank, and twice as presi-
dent of the stock exchange.
Foreign Minister Muniz has said
that the new economic team will
be the most skilled and, dedicated
Argentina has had for years.
Argentines in general, however,
have become irritated with eco-
nomic difficulties and will be
looking for immediate concrete
results.
The causes of the business
recession lie in long-standing
economic disorders, aggravated
by political instability. The
government is severely hampered
by the lack of liquidity in the
economy, reflected in its short-
age of both pesos and foreign
exchange. This has aggravated
the difficulties of private
business, reducing earnings
and tax receipts. The govern-
ment has adhered to its restric-
tive credit policy in line with
its economic stabilization pro-
gram and agreement with the In-
ternational Monetary Fund.
Bankruptcies in Argentina
reached an all-time high during
November. In this month alone,
205 firms failed, with total
liabilities ten times as great
as the total for firms which
failed in November 1961, and 20
times those failing two years
ago. Most categories of business
and manufacturing have suffered,
but the metallurgical and tex-
tile industries have been
particularly hard hit.
Business sources estimate
that industrial production in
1962 will be at least, 15 per-
cent below last year, and re-
tail sales have dropped even
further. According to the
official index of physical
volume of sales,,sales,in Septem-
ber were only 62.3 percent of
the 1958 average.
Unemployment has increased
with the business recession.
An estimated 270,000-325,000--
15 to 18 percent of the in-
dustrial labor force of 1.8
million--are unemployed, and
an additional 7-10'percent are
working a short week. Living
costs rose 28.4 percent during
the first ten months of 1962,
causing further reduction in
real wages. Both civilian
and military officials fear
that continued widening of the
wage gap will increase labor un-
rest and create an explosive
situation.
Along with these problems,
military plotting against Presi-
dent Guido's government continues.
The,ll-12 December coup attempt
by -cashiered air force generals
Alsina and Oliva, however, was
quashed by quick government action
aided by'other air force personnel.
President Guido relieved Alsina
and Oliva of their commands in
response to a demand by a group
of senior air force officers
that the two be dismissed be-
cause of their continued efforts
to overthrow the government.
The firing of these generals, to-
gether with changes in naval com-
mands, may strengthen the mili-
tary faction favoring continuance 25X1
of the Guido government now and
the holding of elections next
June.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The pattern of Brazil's
trade with the Soviet bloc is
changing. The USSR now leads
Czechoslovak4a, East Germany,
and Poland as Brazil's prin-
cipal trading partner in the
bloc.
Trade with the bloc now
accounts for about 5 percent
of Brazil's total trade. Its
imports from bloc countries
for the first half of 1962 de-
clined to 3.36 percent of total
imports. Exports to the bloc,
however, rose to 7.25 percent
of total exports and consider-
ably exceeded the levels set in
recent years. Exports to the
USSR--of which three fifths
were coffee and cacao---account
for the increase.
Soviet supplies to Brazil
in the first half of ].962 were
limited almost exclusively to
100,000 tons of wheat and 350j-
000 barrels of oil. Wheat and
oil are Brazil's major imports
but these quantities make up
BRAZILIAN TRADE WITH SINO-SOVIET BLOC
(in thousands of dollars for the first six months)
IMPORTS (CIF) EXPORTS (FOB)
1960 1961 1962 1960 1961 1962
707 2,438 8,001 0.3 2,231 25,097
Czechoslovakia 8,152 8,360 5,566 6,904 9,007 3,568
East Germany 4,455 7,776 4,360 5,595 6,189 5,059
Hungary 2,453 982 611 3,262 2,308 2,477
Poland 15,588 10,066 2,944 12,176 8,575 1,958
Rumania 229 110 850 767 811 1,919
Communist China 6 9 154
Others - - 2 56 0.3 520
TOTALS r 31,590 29,741 22,488 28,835 29,121 40,598
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only about 5 and 0.4 percent
respectively of the country's
annual import requirements.
A new Brazilian-Soviet
trade pact scheduled to be
signed this month is likely to
provide -Oor an expansion of
trade. The USSR has displayed
some interest in assisting the
construction of a shale oil gas
plant near Sao Paulo. There is
no firm indication,.however,
that Moscow will offer to pro-
vide economic development cred-
its in connection with the
trade agreement, as did the re-
cent Brazilian-Polish agree-
ment.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
IN THE DOMINICAN REPUBLIC
The belief is widespread
that the National Civic Union
(UC:N) will lose the election
to presidential candidate Juan
Bosch and his Dominican Revolu-
tionary Party (PRD). The UCN
is charging that Bosch's party
is Communist-infiltrated, and
both parties accuse each other
of the intention to commit fraud.
The
elections are scheduled for 20
December, and the transfer of
power to the democratically ap-
proved regime is slated for 27
February.
Bosch, a 53-year-old
writer, has been a profes-
sional revolutionary since
the early thirties, when
he was exiled for anti-
Trujillo activities as a
student leader. He has
long been associated with
other revolutionary lead-
ers, including Venezuelan
President Romulo Betancourt,
Costa Rican ex-president
Jose Figueres, and Peruvian
political leader. Haya de la
Torre.
Since his return to
the Dominican Republic,
Bosch has warned that
gradual reforms are neces-
sary in order to avoid pre-
cipitating a chaotic situa-
tion vulnerable to Castro
and the Communists.
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SPECIAL ARTICLES
The appointment of U
Thant to a full term as UN
secretary general has given
one of the world's more in-
fluential positions to a man
who is still in some important
respects an unknown quantity.
He has vigorously defended the
right of other newly emerging
nations to occupy a neutral
position between East and West,
and has been a persistent ad-
vocate of Communist China's
admission to the UN.
According to the UN
Charter, the secretary general
is "the chief administrative
officer of the organization."
By force of circumstance and
personality, however, both of
Thant's predecessors--Trygve
Lie and especially Dag Hammar-
skjold--converted the secretary
generalship into an executive
office with real if limited
powers, and became in -their own
right leading world statesmen.
Thant will have similar
opportunities in the next four
years to extend the influence
of his office, but during the
year in which he has served in
an acting capacity, he has
shown neither the will to nor
the intention of doing so.
Thant is a well-groomed,
suave man of 52, equally pleasant
to those he likes and those he
dislikes. Prior to his appoint-
ment as acting secretary general
last year, he had been Burma's
permanent representative at the
United Nations since 1957.
A close friend of former
Prime Minister Nu, Thant was
regarded as one of Burma's more
able public servants. He sup-
ported Burma's neutralist for-
eign policies, but within this
orientation was broadly pro-
Western in outlook and, accord-
ing to the American Embassy in
Rangoon, a strong anti-Communist.
As Acting Secretary General
Hammarskjold's death in
September 1961 led to a pro-
tracted and bitter wrangle over
the choice of a successor. The
USSR, which had become increas-
ingly angry at the forceful and
decisive Hammarskj old, demanded
that the office of a single sec-
retary general be replaced by
some version of the "troika"--
a triumvirate representing the
Communist bloc, Western nations,
and the neutrals.
UN members generally op-
posed this demand. They agreed,
however, that the secretary general
would have to come from the
neutral Afro-Asian bloc, and the
view was widespread that he
would need to be of a somewhat
more compliant disposition than
Hammarskjold had been. When
Thant's nomination as acting
secretary general was finally
approved on 3 November 1961, he
publicly took account of the
controversy over his office by
promising that he would consult
closely with an unspecified
number of "principal advisers"
representing various areas of
the -world.
Since November 1961, Thant
has ;,proceeded cautiously in in-
terpreting his role as secretary
general. When faced with dif-
ferences of opinion, he seems
to try to bring the other side
around by persuasion, although
he has not hesitated to differ
with Soviet UN delegates in
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private conversation and, ac-
cording to a Canadian delegate,
has urged Zorin to be more "ob-
jective." Several long-time Sec-
retariat officials believe Thant
has "taken tough decisions once
adequate information was avail-
able."
Thant seems to reserve
his decisiveness, however, for
matters he personally considers
important rather than those so
regarded by leading member na-
tions. He took a strong line
on the UN bond issue, for ex-
ample, but has felt that nothing
vital is to be lost by making
extensive concessions in per-
sonnel matters.
In the Dutch-Indonesian
dispute over West New Guinea,
he largely confined his role to
transmitting notes between the
disputants and to public appeals
to both parties to refrain from
using force. He has refused to
enter personally into the Laotian
problem and now is phasing out
the UN "presence" in Laos--
which, despite vigorous Soviet
protests, Hammarskjold estab-
lished in 1959 as a political
observation post and a psychologi-
cal deterrent to Vietnamese in-
tervention.
On Congo matters Thant has
consulted closely with his Congo
Advisory Committee--composed of
countries which now have or have
had troops in the Conc. This
consultation has been so de-
tailed as to result on occasion
in release to the public of
plans in which the element of
surprise has been a vital factor.
In the Cuban crisis Thant
played a relatively passive
role. His trip to Havana never-
theless had the result of giving
Castro a propaganda advantage.
Principal Advisers
Thant has appointed eight
undersecretaries as his principal
advisers--two from the Soviet
bloc, two from NATO? countries,
one from Latin America, and
three from Asian-African neu-
trals. The large number of
close assistants--Hammarskjold
usually had only three--repre-
sents an effort by Thant to ac-
commodate the various factions
in the UN which demanded repre-
sentation at the undersecretary
level, and to some extent re-
flects the Soviet troika con-
cept.
The highest ranking Soviet
member of the Secretariat is
Eugeny D. Kiselev, undersecretary
in charge of political and Security
Council affairs, who assumed of-
fice early this year. It is
not known how closely Thant
actually consults with him.
Jiri Nosek of Czechoslovakia
is the undersecretary in charge
of conference services. He
has represented his government
at the UN since 1947, and has
in the past been a strong candi-
date for the presidency of the
General Assembly. He is gen-
erally regarded at the UN as a
competent and relatively im-
partial presiding officer, and
has been called "the most West-
ern of the Eastern delegates."
The best known Western
representative on the Secretariat
is Ralph Hunche of the United
States. As undersecretary for
special political affairs, Bunche
has been Thant's chief adviser
on Congo affairs--despite the
fact that Godfrey Amachree of
Nigeria is designated as the
undersecretary in charge of
civilian operations in the
Congo.
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The undersecretary in
charge of economic and social
affairs, Philippe de Seynes
of France, held the same post
under Hammarskjold. De Seynes,
described by the US delegation
as "intelligent, hard-working,
and cooperative with the US,"
has been with the UN since 1950.
The French UN delegation was
informed by Thant prior to his
own appointment that he intended
to choose de Seynes as one of
his principal advisers to rep-
resent Western Europe.
The appointment of Omar
Lautfi as a second under-
secretary for special political
affairs probably represents a
personal choice by Thant. The
former UAR permanent represent-
ative and Thant are old friends
and associates. Loutfi represents
the secretary general at the
18-nation disarmament committee
meetings in Geneva.
Thant's most controversial
appointment was that of C. V.
Narasimhan of India as chef de
cabinet and officer in charge
of General Assembly affairs.
Several members of the UN
Secretariat have reported that
Narasimhan is extremely ambitious,
and that he is deliberately ex-
ploiting his influential posi-
tion to cultivate the major
groups, particularly the Soviet
bloc, in order to build up sup-
port for eventual appointment
as secretary general.
One of Narasimhan's
functions is to advise the
president of the General As-
sembly on procedural matters.
With the present strong presi-
dent Zafrullah Khan of Pakistan,
Narasimhan's reported penchant
for "running the show to suit
himself" has been held in check,
but future presidents of the
Assembly may not have Zafrullah's
experience or strong legal
training.
Latin America is represented
by Hernane Tavares de Sa of
Brazil, undersecretary for pub-
lic information. Tavares de Sa
was the senior Latin American
official in the Secretariat at
the time of Thant's appointment
and presumably was chosen for
this reason. The choice, how-
ever, raised some objections
among Latin Americans to having
their group represented by a
"Portuguese-speaking Latin."
These objections were partially
met by the appointment "within
one hour" of long-time UN
civil servant Rolz Bennett
Guatemala to another high T'
post which seems to have been
created particularly for his
benefit.
Because Thant delegates
responsibility widely, the
abilities of his principal ad-
visers and their capacity to
work together will probably be
a major factor in the over-all
effectiveness of the UN during
his tenure as secretary
general. The policies which
he has adopted and applied in
such different situations as
the Congo, the bond issue, and
West New Guinea show a capacity
for delicate diplomacy. Thant
comnands the respect of most
Secretariat employees and all
speak highly of his integrity.
It may be that Than.t's quiet
approach will in the next four
years result in some definite
progress toward his expressed
goal. of "bridging the gulf be-
tween the major powers." How-
ever, Thant's observations of
the effect on the UN of Hammar-
skjold's fight with the USSR,
added to his own experience as
a neutralist representative,
will, probably incline him to
avoid a direct confrontation
with the USSR on a matter of
policy.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
TANGANYIKA A YEAR AFTER ]INDEPENDENCE
Completion of Tanganyika's
first year of independence was
marked on 9 December by the for-
mal move to republic status
within the British Commonwealth
and the inauguration of Julius
Nyerere as president.
Nyerere, a moderate nation-
alist and leader of the smoothly
operating Tanganyika African Na-
tional Union (TANU), was the
greatest asset of this impover-
ished former German colony and
British trust territory when it
achieved independence. Its ag-
riculture-based economy suffered
from an inadequate transporta-
tion system, a tsetse fly in-
festation, and depressed world
prices for its two principal
export crops. The country had
only a bare cadre of Africans
trained to administer the exist-
ing government machinery or any
development plans. Despite a
substantial increase in educa-
tional facilities over the last
five years, from a population
of 9.5 million only 360 graduated
from secondary schools in 1960
and only 20 from colleges last
year.
The critics--largely within
TANTJ--pointed out that independ-
ence had not brought real eco-
nomic or social change. Europeans
and Asians remained in senior
government posts and continued
to enjoy segregated clubs. The
press featured incidents of
racial discrimination, and at
least five. offenders were ex-
pelled.
Last January, after a bitter
opposition attack on his nonracial
policies, Nyerere resigned as
prime minister, although he was
able to name as his successor the
moderate Rashidi Kawawa. In the
cabinet reshuffle, however, the
British finance minister was
dropped and radical Oscar Kambona
was named minister of home af-
fairs in control of the police.
Kawawa sought to pacify the
government's critics by appoint-
ing one of their principal spokes-
men to head a new commission for
planning the complete Africaniza-
Lion of the civil service. He
also dismissed the British police
commissioner and the British civil
service chief.
During the nation's first
year, Nyerere and his close as-
sociates consolidated their con-
trol, but did little to overcome
Tanganyika's many handicaps.
Hundreds of non-African managers
and specialists left the coun-
try, and it became a center for
African nationalist activity
directed at other east and south
African territories.
Before independence, Tan-
ganyika's Africans appeared to
enjoy unusually harmonious re-
lations with the country's
Asian merchant class and its
few European settlers. With
independence, however, they
started demanding that Asian
influence in commerce and in-
dustry be reduced, and Nyerere's
nascent opposition tended to
express its frustration in
racial terms.
In all, some 700 expatriate
officials have left Tanganyika.
Africans hold about one third of
senior and middle-grade civil
service positions--but about a
quarter of all posts are vacant.
The contracts of the remaining
expatriate permanent secretaries
of ministries may soon be termi-
nated.
"One-Party Democracy"
After resigning as prime
minister, Nyerere, still TANU's
leader, devoted his energies to
tightening the party organization
and completing its domination of
the country. His proclaimed goal
is "one-party democracy."
Shaken by the dispute over
racial policy, Nyerere realized
that he had become separated from
his party, and that the organiza-
tion, stripped of its ablest
leaders to man the ministries,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
was slowly disintegrating. He
believed that a nation of such
meager talent could not afford
the "luxury" of political de-
bate and parliamentary opposi-
tion.
Nyerere therefore sought
to identify the mass of the
people more closely with the
party and the government. The
Africanization program formed
one part of his campaign, and
he worked closely with Kawawa
in tightening governmental con-
trol. Expatriate provincial
commissioners were renamed "ad-
ministrative secretaries" and
made responsible to African
regional commissioners--all
TANU men--whose principal task
was to build close links through
the party between the central
government and the ordinary vil-
lager. The authority to permit
political meetings was trans-
ferred from the police to these
regional commissioners.
The government has also
undermined the authority of the
tribal chiefs. It has deprived
them of their administrative
functions and confined them to
ceremonial duties.
TANGANYIKA
Nyerere has brought another
power center, the trade union
movement, under close govern-
ment control. The Tanganyika
Federation of Labor (TFL), al-
though allied with TANU in the
drive for independence, after-
ward opposed many of Nyerere's
policies. Last January the gov-
ernment averted a clash by ap-
pointing one TFL leader as high
commissioner in London and an-
other as minister of health and
labor. Their successors announced
that TFL would cooperate fully
with TANU on "all matters concern-
ing the nation."
Last June, aided by growing
public dissatisfaction with wild-
cat strikes, the government pushed
through several bills which made
all strikes illegal and gave the
government sweeping powers to
enforce settlement of industrial
disputes. All unions were re-
quired to join the officially rec-
ognized TFL or be dissolved.
Preventive Detention
Perhaps the clearest example
of the government's intention to
build a strong central executive
was the adoption of a preventive
MOZAMBIQUE
(PORT.)
INDIAN OCEAN
MALAGASY
REPUBLIC
rd I
STAT
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CURRENT INTELLIGENCE WEEKLY SUMMARY
detention law iii September. The
National Assembly passed without
debate an "urgent" government
bill allowing the minister of
home affairs to detain. any per-
son threatening the stability
and security of the state. There
is no appeal in any court and
no limit to the term of deten-
tion.
In justifying the bill,
government spokesmen cited in-
ternal disorders in other newly
independent countries and in-
sisted that extraordinary meas-
ures were necessary to pro-
tect Tanganyika's government
against overthrow by undemo-
cratic means.
Foreign Affairs
Even more than most newly
independent African states,
Tanganyika has sought to avoid
involvement in the cold war.
Its representatives rarely speak
on international issues in
forums such as the UN General
Assembly. It has sent few
representatives abroad and has
restricted the size of both
bloc and Western missions in
Dar es Salaam, the Tanganyika
capital. It has avoided taking
sides between the rival Casa-
blanca and Monrovia groupings
of African nations.
Nevertheless Dar ess Salaam
is replacing Cairo as a main
center of political action op-
erations into the countries of
south and east Africa. It is
the transit point for African
nationalists going abroad for
study and the home of numerous
refugee groups. Those from
Mozambique, the Rhodesias, and
South Africa are particularly
in evidence, and Tanganyika will
probably play an important role
in the nationalist effort against
the Portuguese regime in Mozam-
bique.
The refugee leaders usually
meet weekly under the chairman-
ship of a senior official' . in the
Tanganyikan Ministry of Home
Affairs. Bloc diplomats--par-
ticularly Soviet and Chinese
Communist--are in active contact
with opposition leaders from
neighboring countries.
The Soviets in Tanganyika
have focused their efforts on
labor leaders. The TFL, which
they reportedly consider one
of Africa's more important
labor movements, has accepted
30 scholarships for study in
the Soviet Union. The Tangan-
yika Government has accepted
an additional 60 Soviet scholar-
ships provided the students at-
tend! some university other than
Lumumba University in Moscow,
which is the usual training
spot for Africans.
Economic Prospects
The most pressing problem
facing Nyerere's republican
government is accelerating the
slow pace of economic development.
The per capita income, equiva-
lent to $60 a year, is low even
for Africa; the budget deficit
amounted to some $30 million
in fiscal 1962; and monetary
reserves are slender. There
is little local capital avail-
able for development, and the
country's dependence on agri-
cultural products--mainly sisal
and coffee--for some 60 percent
of its gross domestic production
at a time of depressed world
prices limits its opportunity
for earning foreign exchange.
A three-year development
plan envisages an expenditure
of $71) million by June 1964,
devoted largely to road construc-
tion, agriculture, and educa-
tion. Rural development is
being emphasized to discourage
migration to the cities and an
increase in urban unemployment
and security problems. This
"people's plan" encourages
villages to build their own
roads, houses, and schools in
a communal effort, and it appears
to be gathering momentum.
Nyerere has talked in terms
of a socialist economy but he
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CURRENT INTELLIGENCE WEEKLY SUMMARY
has said that he will welcome
private investment capital from
abroad.
Both Nyerere and Kawawa
recognize the critical need
for receiving foreign advice.
Nyerere has emphasized the need
to continue overseas recruitment
of advisers sympathetic with his
country's needs. He is setting
up a "brain trust" of five
foreign nationals who would re-
port directly to him through
an alien director of planning.
US aid and Peace Corps pro-
grams are welcomed.
Outlook
Tanganyika's future depends
largely on the continued leader-
ship of 39-year-old Nyerere. For
the immediate future, he is
bolstered by the resounding 98
percent of the popular vote
he received last month in the
presidential election.
While Nyerere can be ex-
pected to continue his moderate
course in international affairs,
they growing strength of the
executive at the expense of
legislative, judicial, and
labor organizations will prob-
ably bring a further erosion
in the meager substance of
democracy--if less abruptly
than has occurred in Ghana.
Any successor such as Interior
Minister Kambona could complete
the destruction of representa-
tive government and orient the
country more toward the bloc.
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