WEEKLY SUMMARY NUMBER 72
Document Type:
Collection:
Document Number (FOIA) /ESDN (CREST):
CIA-RDP78-01617A002200250001-9
Release Decision:
RIPPUB
Original Classification:
S
Document Page Count:
18
Document Creation Date:
December 27, 2016
Document Release Date:
May 22, 2013
Sequence Number:
1
Case Number:
Publication Date:
October 4, 1949
Content Type:
REPORT
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COPY NO.
WEEKLY SUMMARY
Number
fj.. OCT 194
Document No. 00/
NO =NU in Class. rl
NoSECLASSIFILD
Class. C'Lt" "I'D TO: TS S C
DDA Memo, 4 Apr 77
Auth: DDA RG. 77/1763
Date: ,?o2-7S0 By: 121.?3_,
CENTRAL INTELLIGENCE AGENCY
)
(,(1
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1. This publication contains current intelligence exclusively
and therefore has not been coordinated with the intelli-
gence organizations of the departments of State, Army,
Navy, and Air Force.
2. This copy may be either retained, or destroyed by burning
in accordance with applicable security regulations, or
returned to the Central Intelligence Agency.
WARNING
This document contains information affecting the na-
tional defense of the United States within the meaning
of the Espionage Act, 50 U.S.C., 31 and 32, as amended.
Its transmission or the revelation of its contents in any
manner to an unauthorized person is prohibited by law.
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fr
. SECRET
CONTENTS
wage
HIGHLIGHTS.aeo??41* 000000 ? o ?ep
WESTERO EUR PE 2
EASTERN EUROPE 4
,FAR EAST 8
ARTICLE
European Pyrites Situation.. 12
SECRET
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1
1
SECRET
HIGHLIGHTS
Soviet concern over "unreliability" within the
Satellites has been finding expression in the current
wave of arrests in Czechoslovakia. These arrests, which
appear to be striking mostly at the Czechoslovak middle
class, are designed to reduce popular resistance to the
Communist regime and to displace government officials
of uncertain loyalty to the Kremlin (see page 5). Kremlin
awareness of an increasing Czechoslovak hostility to
Communism, aggravated by the reduced standard of
living since the 1948 coup, may lead e USSR to develop
the present terrorist campaign into a purge of the Czecho-
slovak Communist Party.
While the Chinese Communists continue to exert
every effort to win recognition for -Ai e new regime, eir
military forces are moving into the last p se of the
battle for the Chinese mainland (see page 8). Kt Canto
no lo er in Nationalist hands and with the last effective
Nationalist Army in full retreat under the leadership of
Pai Chung-hsi, Communist forces are now released for
an offensive against the Chinese provinces in the west.
SECRET
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1
WESTERN EUROPE
ITALIAN COLONIES
Compromise Necessary With the US proposal to c e the
? bulk of Eritrea. to E s,..iopla virtually
certain to be defeated in the UN General Assembly, the US
and UK will probably be forced to seek a compromise solution
that will secure as much as possl?le for Ethiopia while pro-
tecting US interests in the area. A compromise suggested by
some Latin American delegates as likely to command
general GA support would be co ederation of Ethiopia Sand
Eritrea assuring adequate safeguards for Eritrean autonomy.
Both Italy and Ethi..la have indicated they might accept such
a pro3posal. Short of some such compromise pos onement
of any action until a UN commission visits Zive territory in
dispute may be the eventual decision of e General Asse .1.17%)
Meanwhile, al?? ough the Latin American decision to tie Libyan
independence to Italian trusteeship for Somaliland strengthens
Italy's position, the increasingly vocal hostility of the native
population to Italian return provides a strong deterrent to
such a solution.
FRANCE
Labor Outlook The bargaining position of French labor has
been strengthened as a result of the collapse
of the Queuille Government on the issue of laborps demands,
and any Third Force Government will probably make a prompt
concession to labor in ? e form of a cost-of -lilting bonus to
all workers. Serious labor unrest, however, Is likely to be
prolonged throughout this fall until basic wage levels are sub-
stantially raised alda retur to collective bargaining is begun.
Cl T1 171 /71
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FRANCE
The movement toward "unity of action" initiated by the
General Confederation of Labor (CGT) will be only tzmporar-
Hy slowed by the granting of a bonus and the promise of a
gradual return to collective bargaining. Although in the past
the COT has found it necessary to modify its strike program
in view of the firm opposition of leaders of the Force Ouv-
riere (FO) to "unity of action," increased pressure among
the rank and file of labor for higher wages may provide the
CGT with an improved opportunity for strikes. The FO,
still opposed to unity of action with the COT, has recom-
mended the reconstitution of the labor union,"cartel," com-
posed of FO, the Christian Labor Confederation, and the
Technicians Union, for joint action on the labor problem.
THE NETHERLANDS
The Hague Conference The Dutch Cabinet is not expected
to fall during the current Round
Table Conference at The Hague over any of the issues now
being disputed. Following the withdrawal of the financial
proposals made by the US representative (over which the
Cabinet threatened to resign), the Dutch presented a pro-
posal to establish an arbitration committee which would
? attempt to ascertain the extent to which the Indonesian debt
could be attributed to Dutch military action. Initially, the
Dutch were strongly opposed to such a course of action, and
the Dutch reversal apparently indicates that they are now
willing to compromise rather than see the Conference end
without a settlement of the financial issue.
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EASTERN EUROPE
Currency Devaluation Although western currency devalue
-
tions will not have any immediate
significant effects upon East-West trade relations, commerce
between the East and West will probably fail to expand to the.
extent possible prior to devaluation. The immediate i epact
of western devaluations will be cushioned to some extent by
the existing East-West bilateral trade and barter agreements
which are expressed in terms e wester currencies., Any
necessary price adjust eents can be made under the present
flexible system of state export subsidies and price controls.
Succes of e western devaluations, however, will pose a
long-range problem for Eastern MI?. ?ean states, especially
Czech lovakia, Poland, and Hungary, because of their depend-
ence upon increased trade with the West to maintain productive
economies. If the trade barriers between estern European
nations are lowered as planned, or eliminated, the increased
economic health of Western Europe will make it more difficult
for Eastern Eurropean states to earn much needed foreign e
chad, -e to purchase western industrial equipment and raw
materials. Moreover, the establishment of more realistic
values for Western European currencies will reduce Eastern
Eur ? 4 ean opportunities to engage in black market exchange
operations.
SOVIET UNION
Production Difficulties Soviet difficulties in obtaining certain
strategic raw materials and in achiev-
ing satisfactory production of anti-friction bearings are sympto-
matic the industrial supply and production pr c?lems with which
the USSR will be confronted for some time to come. Even ough
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SOVIET UNION
an original agreement for the production of leather -working
machinery by a Czechoslovak firm provided that Soviet bear-
ings would be delivered for inclusion in the machinery, the
USSR has now specified that only Swedish bearings may be
used, giving as explanation that experiments with machinery
equipped with Soviet bearings indicated bearing wear after
only 72 hours running time, In the field of strategic raw
materials, the USSR is experiencing difficulties in obtaining
adequate amounts of tungsten and molybdenum, both of which
are used in producing high-speed cutting tools and heat-and
corrosion-resisting alloys. With most sources of these
strategic minerals in Western Europe closed or restricted,
the USSR may be forced to rely upon Korea, Manchuria, and
South China to supply these metals.
CZECHOSLOVAKIA
Police Action The current wave of arrests in Czechoslovakia,
apparently striking primarily at middle-class
elements and at some government and Communist Party
personnel, is probably designed to reduce popular resistance
to the present regime and to displace government officials con-
sidered "unreliable' by the Kremlin. Moreover, the present
campaign will strengthen the position of Stalinists in the Party
and prepare for bringing Czechoslovakia under the degree of
control now exercised by the Kremlin over other Satellites.
The pro-Stalinists may later attempt to exploit the situation
by purging the Party.
Because of economic difficulties and general dissatis-
faction, the population of Czechoslovakia has become increas-
ingly hostile to Communism, and much of the government
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CZECHOSLOVAKIA
administration, particularly the army and police, is con-
sidered by the Kremlin to be unreliable. The standard of
living, already sharply reduced since the Communist coup,
will probably be further reduced, thus aggravating popular
dissatisfaction with both the economic situation and the
Communist policies considered responsible. The growth
of unrest in labor ranks in a country so highly industrialized
has likewise been of major concern to the Communists,.
Moreover, the over-sized and ideologically weak Communist
Party has never had a real purge to reduce it to a Stalinist
"hard core," and such a purge might develop from the cur-
rent terrorist campaign.
BULGARIA
New Economic Role In an attempt to counterbalance both
a rebellious Yugoslavia and a re-
vitalized Greece, nearly victorious over the guerrillas, the
USSR is apparently singling out Bulgaria for a key economic
role in the Balkans. The USSR and other Cominform nations
reportedly agreed at the August meeting of the Council for
Mutual Economic Assis n.ce (CEMA) that CEMA. should
channel special economic aid to Bulgaria in return for con-
tinned adherence to the Cominform line, which ulgaria has
already demonstrated by recently severing trade agreements
with Yugoslavia,. More than compensating for any possible
ill effects from this step, however, are the benefits promised
or already accruing from CEMA's agreement to provide
Bulgaria with: (I) economic specialists and technicians for
guidance in implementing increased industrial production;
(2) stepped-up shipments of machinery, (including aviation
I.
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BULGARIA
equipment already received, motor vehicles, and spare
parts for trucks); (3) increased credits, (which, if pro-
viding sufficient investment capital, will eliminate one of
the major obstacles to the Five Year Plan); and (4) 125,000
tons of Soviet wheat before the end of 19498 ulgariass
first mission as the new Balkan leader for the USSR is to
provide support for Albania's economic program.
Cl 17 T) /71 rT1
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