CENTRAL INTELLIGENCE BULLETIN - 1959/07/15

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02989910
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 14
• Document Creation Date: February 25, 2020
• Document Release Date: February 27, 2020
• Publication Date: July 15, 1959

�TOP�SEERET� 3.5(c)
15 July 1959
3.3(h)(2)
Copy No. C 63
CENTRAL
INTELLIGENCE
BULLETIN
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15 JULY 1959
I. THE COMMUNIST BLOC
USSR reports industrial growth for
past six months at rate greater than
called for by Seven-Year Plan.
Hungary threatens restrictions on
American Legation personnel if US
again pushes for UN discussion of
Hungarian question.
II. ASIA-AFRICA
Domestic pressures likely to oblige
Tokyo to return some Koreans to North
Korea even if present plan is disap-
proved.
UAR--Syria facing critical economic
situation.
IlL THE WEST
0 Former Greek Cypriot terrorist lead-
er may soon enter Greek politics;
ultimate threat to ICaramanlis regime
possible.
IV.
0 Conclusions of special USIB commit-
tee on Berlin situation.
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CENTRAL INTELLIGENCE BULLETIN
15 July 1959
DAILY BRIEF
I. THE COMMUNIST BLOC
USSR: During the first six months of the USSR's Seven-
Year�PM, industrial production was 12 percent above the
corresponding period of last year, according to a TASS sum-
mary of the semi-annual status report, The midyear figure
4 in the past has usually been a good indication of performance
0 for the full year. The Seven-Year plan calls for an average
annual increase of 8.6 percent. (Page 1)
(Chart)
Hungary:E Hungarian official recently informed the
British minister in Budapest that if the United States were
not dissuaded from actively pushing discussion of the Hun-
garian question in this fall's UN session, Hungary would be
obliged to undertake additional restrictive measures against
American officials in Budapest. The United States Legation
believes that the regime is prepared to go to considerable
lengths to accomplish this objectivq
(Page 2)
IL ASIA-AFRICA
Japan-Korea: ambassador MacArthur reports that pres-
sure in Japan for repatriation of Koreans is so great that the
Japanese Government will eventually permit return of some
Koreans to North Korea. If the International Committee of
the Red Cross (ICRC) disapproves the present plan proposed
by Japan and North Korea, he believes the Japanese and
North Koreans will modify their plan to meet any ICRC re-
quirements. President Rhee shows little inclination to pro-
pose a constructive plan for the acceptance of the prospec-
tive Korean repatriates in South Korea
) (Page 3T
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II
UAR: Syria's economy has gradually deteriorated since
the establishment of the :UAR last year. , The failure of the
wheat crop, In top of the loss of about 22000,000 sheep--some
40 percent of the total)--as the result of last winter's severe
L. weather, has now brought about a critical economic situation.
-D� Local Syrian officials have hinted that they may seek US sur-
plus agricultural commodities. The situation may provoke an
increase in anti-Egyptian feeling.
(Page 4)
III. THE WEST
c Greece: Evidence is continuing to accumulate that the en-
trance of the ormer Greek Cypriot terrorist leader, General
Grivas into Greek politics may be imminent. Relations be-
tween this extreme right-wing nationalist and Greek Premier
Karamanlis have continued to deteriorate. Grivas' popularity,
combined with the desire of some right-wing politicians to
destroy Karamanlis, might be such as to enable him ultimately
c to bring down the present government. His emergence as a power
\\ in Greek politics would severely hamper implementation of the
Cyprus accords which he opposes and would seriously affect
Greece's relations with Turkey, Britain, and possibly with the
United Statf33 (Page 5)
IV. CONCLUSIONS OF SPECIAL USIB COMMITTEE
ON BERLIN SITUATION
The USIB has taken note of the following conclusions reached
by its special committee on the Berlin situation. The committee
pointed out that its conclusions are to be used in context with all
SNIEs relevant to the Berlin situation.
I. The USSR is attempting to reassure the Western
powers that the USSR will continue to respect their rights
in Berlin during an indefinite period of East-West negotia-
tions, even after a failure of an all-German committee to
reach agreement. This in part reflects Soviet anticipation
15 July 59 DAILY BRIEF ii
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NIS Nort'
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of an interim arrangement on Berlin which Moscow could
present as superseding the postwar agreements on which
existing Allied rights are based and which would, in addi-
tion, be subject at any time to continuing threats of unilat-
eral action.
2. So long as the Russians estimate that the prospects
for negotiation with the West over Berlin are favorable to
them, they will not conclude a separate peace treaty with
the GDR or turn over access controls to the East Germans.
The USSR will continue to use threats of such action as a
form of pressure on the West. The actual physical trans-
fer of controls could be accomplished with little or no
warning.
3. While there are no reliable indications of a bloc
intent to deny Allied or West German access to West Berlin
or to seal off West Berlin in the immediate future, such ac-
tions could be taken with little or no warning.
4. There has been no significant change in West Ber-
lin's favorable economic situation. Public morale continues
high.
5. There have been no significant changes in Soviet
capabilities to respond to possible Western actions in the
event of turnover, harassment, or blockade.
6. There were no major intelligence indications of
Western allied diplomatic intentions, apart from information
obtained through official contacts with US representatives.
15 July 59
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DAILY BRIEF iii
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USSR:TRENDS IN INDUSTRIAL PRODUCTION
(Million Metric Tons
Unless Otherwise
Specified)
production
First Half
1958
Production
First Half
1959
Percentage Increase
First Half 1959
Over
First Half 1958
Percentage Annual Rate
of Increase Needed
to Achieve
Seven-Year Plan Goals
Crude Steel
27
29. 3
8. 5%
6. 6-7. 4%
Pig Iron
19. 3
21
8,8%
7,4-8, 5%
Rolled Metal
21. 3
23.1
8.5%
6. 3-7. 4%
Coal
245
252
2. 9%
2.7%
Petroleum
54
61, 7
14,3%
11.1%
Electric Power
114
126
10, 5%
11. 8%
( Billion K. W. H. )
Percent Increase First Half
� s 1958 Over First Half 1957
Gross Industrial
10.5%
12 %
. 8.6%
Output
Labor Productivity
6 %
8 %
5. 6%
In Industry
90714 5
UNCLASSIFIED
15 ?I...we 1959
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I. THE COMMUNIST BLOC
Soviet Midyear Statistical Report
A TASS summary of the Soviet plan-fulfillment results
for the first six months of the Seven-Year Plan, announced
on 13 July by the Central Statistical Board, indicates good
progress toward Seven-Year Plan goals. Total industrial
production is reported to be 12 percent over the corresponding
period of last year. Six-month statistics in the past have usual-
ly been a good indication of performance for the full year. The
Seven-Year Plan calls for an average annual increase of 8.6
percent.
Official Soviet production indices are accepted as statistical-
ly accurate, but they are not directly comparable to US statistics.
The plan was fulfilled by all union republics and economic
areas (sovnarkhozy). Industries overfulfilling their plan includ-
ed iron ore, pig iron, steel, rolled metal, nonferrous metals,
machine tools, electricity, coal, and oil. In chemicals, the
only sectors reported as overfulfilling target figures were
synthetic resin and plastics and artificial and synthetic fibers.
In agriculture, reported overfulfillment of the state pur-
chase plan for livestock products and of spring sowing quotas
are the results of good feed supplies from 1958's bumper crop
and of an early dry spring.
CONFIDENTIAL
15 July 59
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Hungary Threatens r urtner moves Against United States
/he Hungarian regime has threatened to take further ac-
tions against American officials in Hungary if the United States
does not stop what the regime characterizes as "anti-Hungarian
activities Hungarian Deputy Foreign Minister Peter, in making
this threat to the British minister, implied that the 6 July action
restricting US diplomatic travel in Hungary might be only a first
step if US policies were not altered. The Hungarian note of 6
July, which imposed severe travel restrictions on American of-
ficials in Hungary, was the implementation of an earlier threat
that the US role in barring the Hungarian delegation from the
International Labor Organization would adversely affect rela-
tions between the two countrie2:),
d_r.'he American Legation in Budapest believes that the regime
is prepared to go to considerable lengths to keep the United States
from actively pushing discussion of the Hungarian question in the
General Assembly this fall. Regardless of the position taken by
the United States, Sir Leslie Munro must report to the assembly
about his failure to gain entry into Hungary as the UN's representa-
tiv
l@lring the past several months the Hungarian regime has
followed an increasingly antagonistic course vis-a-vis the Ameri-
can diplomatic representatives in Hungary. In addition to travel
restrictions, surveillance of US personnel has intensified and the
regime appears to have been preparing to expel the American
army a,ttach_0:
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IL ASIA-AFRICA
Repatriation of Koreans in Japan to North Korea Appears
Certain
ambassador MacArthur believes public pressure in Japan
for repatriation of Koreans is so great that the Japanese Gov-
ernment will eventually return some Koreans to North Korea.
If the International Committee of the Red Cross (ICRC) dis-
approves the present plan proposed by Japan and North Korea,
MacArthur believes the Japanese and North Koreans will modify
it to meet any ICRC requirements. No Japanese government
would be strong enough to call bff the entire scheme at this
point, and efforts by Prime Minister Kishi to resist public
pressure cotiTd seriously damage his posittim and perhaps even
force him out of officq
ICRC, which now is considering the Japanese - North
Korean repatriation agreement, feels that it is morally com-
mitted to assist in the repatriation. The ICRC, however, is
concerned that a hasty decision will involve it in the "cold war"
and forfeit its reputation as a neutral, independent organiza-
tion. The committee apparently believes that it might be able
to make a private arrangement with the Japanese Red Cross
which would give the ICRC an effective role in the screening of
the repatriate_g
President Rhee informed his ambassador in Washington on
11 Ju y that he could not accept an American proposal that South
Korea announce a constructive plan which would recognize the
right of Koreans in Japan to choose their place of residence and
offer them immediate repatriation to South Korea. On 13 July,
Rhee indicated to Ambassador Dowling a strong desire for a
settlement with Japan, but he gave the impression that he would
be inclined to discuss the repatriation question with Toirt,r% ("IF"
if the issue of repatriation to North Korea were evaded.
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15 July 59 CENTRAL INTELLIGENCE BULLETIN
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Syria Facing Agricultural Crisis
Syria's worst wheat crop in recent years,rt-ogether with the
loss of about 2,000,000 sheep--some 40 percent of the total--as
a result of last winter's severe weather} has created a crisis in
Syria's economy. Although official Sy'Ilan sources still claim
publicly that the current wheat crop will more than meet domestic
requirements, trade sources believe Syria will have to import
between 300,000 and 400,000 tons of wheat. Local officials of a
US oil company report that sales of oil products to farmers dur-
ing the harvesting season dropped 15 percent compared with last
year, and that the total crop will be only a third of the earlier
official estimate of 700,000 tons.
Cairo, increasingly aware of growing local criticism over
worsening economic conditions in the Syrian region, has sent a
number, of high-level delegations all promising rapid economic
development within the framework of ambitious five- and ten-year
plans. Although the present agricultural crisis can be attributed
mainly to weather, there is likely to be a serious increase in
anti-Egyptian feeling. Egyptian efforts to dominate the Syrian
economy by establishing joint Egyptian-Syrian companies to con-
trol cotton and wheat marketing have been only reluctantly ac-
cepted.
In addition: implementation of the agrarian reform last year -
contributed to the crisis. New farmers lacking "know-how" and
capital sold government-supplied seed stocks for food money. The
fears of landlords not yet affected by land reform that the govern-
ment would confiscate crops also reduced the area planted.
Local officials have hinted that they, like the Egyptians� may
seek US surplus agricultural commodities.
-CONFIDENTIAL
15 July 59
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I I L THE WEST
Grivas Apparently to Enter Greek Politics
rividence continues to accumulate indicating that General
George Grivas, EOICA leader on Cyprus during the struggle
against the British, is about to enter Greek politics. Grivas
has repeatedly shown dissatisfaction over implementation of
the Cyprusaccords, accusing the Greek Government and Arch-
bishop Makarios a granting too many concessions to the Turks
and Britisjg
1-ivas, who was given a hero's welcome when he returned
to Greece in February, is an extreme right-wing nationalist
with a history as a fanatical anti-Communist. His entrance into
politics would provide a new leader for those rightists who have
previously supported Karamanlis' moderate right-wing govern-
ment because of the absence of any promising alternative. This
could include several deputies of Karamanlis' own National
Radical Union. Relations between Grivas and Greek Premier
Karamanlis have worsened recently. Opposition politicians,
who have long sought to destroy Karamanlis politically, see a
potential rallying pOint in the popular EOICA leader and have tried
to lure him into politics. If Grivas were able to attract prom-
inent politicians to his cause, he could bring down the present
governmen_tg
..Trivas is expected to advocate a hard line against Commu-
nism, the Cyprus accords, Turkey, and Britain, and he may
charge the present Greek Government with being overly depend-
ent on the United State
&akarios, in press interviews and in blistering letters to
the general, has condemned Grivas' interference in Cypriot af-
fairs. A formal denunciation of AtIakarios by Grivas--expected
within a few days--will destroy right-wing unity among the Greek
Cypriots at a time when these conservatives face a serious chal-
lenge from a well-organized Communist-led left wing)
15 July 59
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CONFIDENTIAL
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
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 Operations
Director for Intelligence, The Joint Staff
Assistant Chief of Staff for Intelligence, Department of the Army
Director of Naval Intelligence, Department of the Navy
Assistant Chief of Staff, Intelligence, Department of the Air Force
Supreme Allied Commander, Europe
Commander in Chief, Pacific
The Department of the Interior
The Secretary of the Interior
Federal Bureau of Investigation
The Director
Atomic Energy Commission
The Chairman
National Security Agency
The Director
National Indications Center
The Director
United States Information Agency
The Director
CONFIDENTIAL
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