CENTRAL INTELLIGENCE BULLETIN - 1959/10/15

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03184153
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 14
• Document Creation Date: February 25, 2020
• Document Release Date: February 27, 2020
• Publication Date: October 15, 1959

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15 October 1959
3.3(h)(2)
Copy No, C
CENTRAL
6 5
INTELLIGENCE
BULLETIN
DOCUMENT NO.
NO Cl IANC E IN CLASS.
DECLASSIFIED
CLASS. CHAN'..';E0 FO: T"
NEXT REVIEW DATE:
OA otre0_ REVIEWER:
kit" 1111470-2
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15 OCTOBER 1959
I. TEE COMMUNIST BLOC
Soviet ambassador to Communist
China replaced.
Indonesia.n foreign minister, after
visit to Peiping, sees China as grow-
ing problem for future in Asia.
Bloc continues to negotiate arms and
economic aid with UAR despite irrita-
tion at Cairo's policies.
II. ASIA-AFRICA
Strained Saudi Arabian - ARAMCO re-
lations make shutdown of TAPLINE in-
creasingly likely.
UAR orders its missions to propagandize
Nasir's statement that he will accept UN
resolutions if Israel does likewise. (TOP
0
Imam of Yempn asks Nasir for $58,000, -
000 loan.
South Vietnam concerned over deteriorat-
ing security in southern Laos; plans to
expand training of Laotian troops.
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15 October 1959
DAILY BRIEF
I. THE COMMUNIST BLOC
USSR - Communist China: Pavel Yudin, Soviet ambassador
to Communist China since December 1953, has been replaced by
a relatively obscure Ukrainian party secretary, Stepan Chervo-
nenko. Yudin, once one of the Soviet Union's top ideologists, was
due for reassignment and has been absent from his post for long
periods during the past two years. Chervonenko accompanied
Ithrushchev on the Chinese trip and was apparently designated
for the job well in advance of the official announcement. Yudints
transfer, therefore, may be routine. However, the actions, com-
ing at a time when Sib-Soviet relations apparently are strained,
and the obscurity of the replacement, could be further indica-
tions of irritation between Peipin_g and Moscow.
Indonesia - Communist China: Foreign Minister Subandriots
recent trip to Peiping resulted in a tentative agreement for the
establishment of a Sino-Indonesian working group for "solving
the problem of the Over se in Indonesia"
This arrangement may even-
tually involve some modifi aUonofPjakartasban on alien mer-
chants in rural areas.
*ng Peiping, subandrio
he was taken aback by uninese Communist arro-
giceThnd seeming confidence and believes China will nose an
increasing problem for Asia in the future.
(Page 1)
Bloc-UAR: negotiations
for long-term economic ana military aid are continuing in Mos-
cow, even though there has been increasing irritation between
the bloc and Cairo over the past two months. A Czech trade
delegation is due to arrive in Cairo this week. It is expected
to include officials who are authorized to negotiate a new mil-
itary aid agreement with the UAR. The delegation will probably
also discuss Prarnicitc
ptember offer of economic assistance.
(Page 2)
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II. ASIA-AFRICA
Saudi Arabia: iThe relations of the managements of ARAMCO
and the Tapline Company with Prince Faysal and Petroleum Di-
rector Tariki have become so strained by a number of issues that
a shutdown of the Tapline is increasingly likely. For further de-
tails on this situation, see page 3.)
UAR-Israel:
the UAR has ordered its dipi�tithisSJanr
ons
launch a large-scale propaganda campaign to exploit Nasir's 8
October press interview in which he stated willingness to accept
all United Nations resolutions for settlement of Arab-Israeli
problems, provided Israel also accepts them. The Israelis have
dismissed his interview as "deliberate propaganda."
Nasir probably hopes his campaign will put Israel on the
defensive, create an impression of UAR moderation, and im-
prove his international prestige, particularly in the West. Some
of his recent statements also suggest that he may have a row-
ing respect for the authority and effectiveness of the UN.
(Page 4)
Yemen-UAR: The Imam asked Nasir
for a loan of 20,000,000 Egyptian pounds (about $58,000,-
000 at the official exchange rate) to assist him in unspecified
"projects" which he intends to undertake. Although Nasir has
indicated willingness to help solve the Imam's financial difficul-
ties, he is unlikely to furnish an amount of this size. He is
likely to make a small-scale effort to assist in order to placate
the Imam, who has shnwn siens of being disturbed by UAR ac-
tivities in Yemen. (Page 5)
South Vietnam - Laos: he Diem regime in South Vietnam
is becoming increasingly concerned over what it regards as worsen-
ing security conditions in adjacent southern Laos. South Vietnam
reportedly intends; with Laotian cooperation, to expand its training
of Laotian military personnel and to send additional civilian prop-
aganda and welfare teams into Laos. Saigon's increasingly activistj
15 Oct 59
DAILY BRIEF ii
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ale in Laos risks provoking countermeasures by North Vietnam
affecting not only the Laotian situation but also South Vietnam's
internal securiy2)
(Page 6)
Watch Committee Conclusions: atuations susceptible of
direct exploitation by Sino-Soviet bloc action which would jeop-
ardize US interests exist in Laos and in the Middle East, par-
ticularly in Iraq-3
Laos: atssicient activity has remained at a low level. The
dissidents, however, with probable North Vietnamese assist-
ance, continue to have the objective of establishing themselves
in a strong position which they could use as the basis for polit-
ical bargaining or for the expansion of military operationsj
Middle East: th_e situation in Iraq remains tense. While
order has been well maintained, factional strife may break out
and further attempts against Qasim are possible. In these cir-
cumstances, the UAR may become more deeply involved.
� 15 Oct 59
DAILY BRIEF iii
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I. THE COMMUNIST BLOC
Indonesian Talks in Peiping Reported Unsuccessful
Indonesian Foreign Minister Subandrio
he had made no progress with Peiping on
the Overseas Chinese problem during his 7-11 October visit
to China; he seemed incensed over the treatment he had re-
ceived. Apparently he had made the visit at his own initiative,
in an effort to overcome Chinese opposition to an Indonesian
decree requiring withdrawal of alien merchants from rural
areas. Prior to the trip, he had confided to the American am-
bassador in Djakarta that Communist China was exerting "ter-
rific" pressure for repeal of the decree/
Subandrio speculated in Hong Kong that Communist China's
strong position in behalf of Overseas Chinese stemmed from a
desire to maintain them as a potential vehicle for new aggres-
sive designs. He said he was taken aback by Chinese arrogance
and seeming confidence, and believes China will be an increas-
ing problem for Asia in the future. He felt the Chinese position
was a denial of the Bandung declarations.
Despite failure to resolve difficulties over the decree,
tentative agreement was reached for the ettablishment of a
Sino-Indonesian negotiating group for "solving the problem of
Overseas Chinese in Indonesia,"
In addition to considering
the problems posed by Chinese merchants, this group may also
address itself to implementation of the 1955 treaty abolishing
dual nationality for Overseas Chinese in Indonesia. Ratifica-
tion instruments putting the treaty into effect reportedly will be
exchanged soon. The treaty requires Overseas Chinese to
choose either Indonesian or Chinese citizenship within two years.
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Bloc-UAR Aid Negotiations Continuing
a
Czech trade delegation is scheduled to arrive in the UAR this
week and that the delegation will include negotiators "to conclude
the military agreement."
The UAR last month asked Czechoslovakia to provide addi-
tional military goods, including spare parts for the arms previ-
ously received. At that time, Prague expressed its displeasure
with Cairo's "discriminatory" policy on pricing cotton exports.
UAR officials have since stated that once the cotton-pricing prob-
lem is solved the arms agreement probably will be concluded. In
addition to trade and arms, the Czech delegation presumably will
discuss Prague's offer of last September to extend $28,000,000 in
economic aid,
in addition, that negotiations
for long-term Soviet economic and military aid are continuing in
Moscow, The remaining contracts for projects called for under
the Soviet $175,000,000 economic aid credit are being worked out.
Moreover, the UAR arms-purchasing mission in Moscow now is con-
tracting for the delivery of materiel under a new major agreement,
the general terms of which were agreed to in August by Moscow
and Cairo.
These negotiations are taking place against a background of
increasing irritation between the bloc and Cairo. On 10 October,
Radio Moscow in an Arabic broadcast accused Cairo of seeking
military aid from the West and apparently sought to imply that
bloc aid programs might be affected if relations continued to de-
teriorate. On 12 October, Cairo's Al Ahram replied with an ed-
itorial accusing Radio Moscow of committing "several unpardon-
able blunders of late" and deny:17 the UAR had requested Western
arms.
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15 Oct 59 CENTRAL INTELLIGENCE BULLETIN
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iLASIA-AFRICA
ARAMCO's Position in Saudi Arabia Endangered
1Relations, of the Arabian American Oil Company (ARAMCO)
and the Trans Arabian Pipeline Company (TAPLINE) with Prime
Minister Faysal and Petroleum Director Abdullah Tariki have
become so strained that a shutdown of the Tapline carrying Saudi
oil to the Mediterranean now appears increasingly likely. Tariki
claims ARAMCO has been diverting profits and calculates that the
company owes the government more than $180,000,000. He has
rejected all company proposals to negotiate and apparently has
Faysal's complete support for a pIa.n 'to own and operate ARAMCO
or to destroy it."1
'Since a settlement of the ARAMCO-Saudi dispute has been
a precondition in TAPLINE's parallel negotiations with the UAR
for increased transit fees for the pipeline passing through Syria,
Cairo now may implement its earlier ultimatum to TAPLINE that
it must pay these fees by the end of October or face the imposi-
tion of a tax which will bring in the amount of money demanded.
TAPLINE's position is that the proposed UAR tax is contrary to
the company's concession agreement with the Syrian Region and
will therefore be ignored. TAPLINE plans to continue opera-
tions unless shut down by direct UAR action-J
In anticipation of such a shutdown� the owners of TAPLINE--
the same American oil companies which own ARAMCO--have given
orders to speed construction of a pipeline to increase Saudi oil
export capacity at the Persian Gulf:i
iKing Saud, who has been gathering political support in recent
months, may use the approaching oil crisis to provide additional
justification for an attempt to reassert his own authority. There
are signs of increasing frictions between Saud and Faysal. For
example, Saud has issued orders
to the di/et:tor 01 oroaacastmg that no statement made by Faysal
could be published until it had been cleared by himself. Concern
that Saud might move to enhance his own authority has already
caused the crown prince to put off a contemplated trip�qhmq_d_f_nr
medical treatment of his serious stomach disorder
15 Oct 59
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UAR Propaganda to Stress Willingness to Accept UN Resolutions
On Israel
Cairo has instructed its diplomatic missions abroad to launch
a large-scale propaganda campaign pegged to Nasir's 8 October
press interview advocating acceptance of all United Nations resolu-
tions on Arab-Israeli problems and a UN commission for implement-
ing the resolutions. Nasir specifically declared himself willing to
accept the 1951 resolution on freedom of transit through the Suez
Canal. He added the condition that Israel must also accept the
resolutions.
The Israeli reaction, as Nasir probably anticipated, �was to
dismiss his remarks as "deliberate propaganda." Israel has
frequently expressed its readiness to negotiate wail the Arabs,
but has consistently rejected any suggestion on implementation
of the 1948 resolution on repatriation or compensation of the
Arab refugees and--like the Arabs--has opposed implementation
of the UN's 1947 resolution on the partition of Palestine.
Nasir probably hopes to create the impression that he is
sponsoring a moderate approach to the solution of Arab-Israeli
problems and in this way to improve his international prestige,
particularly in the West. He is almost certainly aware of the un-
favorable picture of him fostered by his adamant stand against
Israeli transit of the canal, and is also anxious to smooth the way
for Western approval of his request to the World Bank for funds
to improve the waterway. In some of his recent statements, how-
ever, there has been an indication of a growing, genuine respect
for the UN's authority ard ability to implement its decisions.
-TO-P-SEGRET
15 Oct 59 CENTRAL INTELLIC;Fkirp IIIlTIkl
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Imam Requests $58,000,000 Loan From Nasir
Imam Ahmad of Yemen asked UAR President Nasir
for a loan of approximately 20,000,000 Egypt
pounds (about $58,000,000) to assist him in unspecified "proj-
ects." He had previously advised Nasir of his need for an in-
definite sum, and apparently received Nasir's assurances of
assistance. Nasir is unlikely to provide such a large amount,
but probably will offer some assistance in order to avoid of-
fending the Imam, who has shown signs of displeasure over
recent UAR activities in Yemen.
The Imam's need for funds is known to be urgent, as re-
flected in his recent decision to reduce the pay of civil servants
and the army. The sum requested, however, is believed to be
considerably more than that required for meeting usual govern-
ment expenses. The reference to "projects" suggests new un-
dertakings. There have been numerous reports that the Imam
hopes to lessen his dependence on the Sino-Soviet bloc by draw-
ing funds from the UAR, but there is no indication that he has
actually adopted such a policy.
The Imam may also be considering some action against the
British-supported federation of Arab states in the Aden Protec-
torate. The request may be merely a maneuver, however, to
get as much assistance from Nasir as possible, and the Imam
probably has as little concern over repayment of this loan as he
has over hisother international financial commitments.
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15 Oct 59
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South Vietnam Increasingly Concerned Over Laos
Ffhp Diem regime, which has closely followed developments
in Laos since the outbreak of Communist hostilities there in mid-
July, is becoming increasingly concerned over stepped-up dissi-
dent activity in the southern Laotian provinces adjacent to South
Vietnam. Vietnamese leaders are particularly disturbed by the
"vacuum" in southern Laos resulting from the commitment of the
bulk of Laotian forces in the north. They fear that a critical
situation inimical to South Vietnam's security is developing thelij
the Diem government has been in close consultation with
Laotian leaders during the past few months, and reportedly has
engaged in contingency planning for joint anti-Communist efforts.
President Diem recently informed American officials in Saigon
that, in agreement with Lao officials, South Vietnam intends to
expand its training of Laotian military personnel and to send ad-
ditional "civic action" teams, made up of personnel trained in
propaganda and welfare work, into Laos. Diem and his advisers
additionally have long considered the covert introduction into
southern Laos of Vietnamese troops disguised as civilians as a
means of bolstering limited Laotian security assets-.1
qvyanwhile, South Vietnam has augmented its representa-
tion in Vientiane, and stepped up its intelligence operations in
Laos, South Vietnam's
newly appointed ambassador to Laos,
is known as a loyal supporter of the Diem government's 'ac-
tivist" win]
Wi_igon's increasing role in Laos risks provoking counter-
measures by North Vietnam affecting not only the Laotian situa-
tion but possibly also South Vietnam's internal secur1ty:1
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15 Oct 59
CENTRAL INTELLIGENCE BULLETIN Page 6
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THE PRESIDENT
The Vice President
Executive Offices of the White House
Special Assistant for National Security Affairs
Scientific Adviser to the President
Director of the Budget
Office of Defense and Civilian Mobilization
Director, National Aeronautics and Space Administration
Special Assistant for Security Operations Coordination
Board of Consultants on Foreign Intelligence Activities
Special Assistant for Foreign Economic Policy
Executive Secretary, National Security Council
The Treasury Department
The Secretary of the Treasury
The Department of State
The Secretary of State
The Under Secretary of State
The Under Secretary of State for Economic Affairs
The Deputy Under Secretary for Political Affairs
The Deputy Under Secretary for Administration
The Counselor
Director, International Cooperation Administration
The Director of Intelligence and Research
The Department of Defense
The Secretary of Defense
The Deputy Secretary of Defense
Assistant Secretary of Defense for International Security Affairs
The Secretary of the Army
The Secretary of the Navy
The Secretary of the Air Force
The Chairman, The Joint Chiefs of Staff
Commandant, United States Marine Corps
The Director, The Joint Staff
Chief of Staff, United States Army
Chief of Naval Operations, United States Navy
Chief of Staff, United States Air Force
Assistant to Secretary of Defense for Special Cperations
Director for Intelligence, The Joint Staff
Assistant Chief of Staff for Intelligence, Department of Army
Director of Naval Intelligence, Department of Navy
Assistant Chief of Staff, Intelligence, Department of the Air Force
Supreme Allied Commander, Europe
Commander in Chief, Pacific
The Department of Commerce
The Secretary of Commerce
Federal Bureau of Investigation
The Director
Atomic Energy Commission
The Chairman
National Security Agency
The Director
National Indications Center
The Director
T1DENTIAL
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