CENTRAL INTELLIGENCE BULLETIN - 1961/01/28

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02000183
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 34
• Document Creation Date: August 14, 2020
• Document Release Date: August 27, 2020
• Publication Date: January 28, 1961

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28 January 1961
Copy No. C &y(f,i1
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BULLETIN
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'*01�9 28 January 1961
CENTRAL INTELLIGENCE BULLETIN
CONTENTS
1. Soviet anti-ballistic-missile test activity. (Page t)
2. Laos: King Savang is willing to receive chair-
man of International Control Commission. (Page t)
3. Congo: Pro- Lumumba forces from Kivu Prov-
ince reportedly have invaded northern Kasai. (Page it)
4. USSR reportedly to ship to Indonesia an additional
$244,000,000 in military equipment during next
three years. (Page ti)
5. Albania, supporting Chinese Communist ideolog-
ical positions, criticizes bloc parties. (Page it)
6. Iran: Some protests and demonstrations against
the government's rigging of current parliamen-
tary elections. (Page tit)
7. King Saud is attempting to bolster his internal
sition and dissipate Nasir's suspicion.
(Page iit)
8.
Tunisia's President Bourguiba appears ready to end
his isolation from the Arab League.
(Page ft,)
9. Negotiations on Greek link to Common Market near
decisive stage. (Page tv)
10. Portuguese Government still concerned over the
seizure of the Santa Maria. (Page v)
11. Venezuela, faced with pressing economic problems,
Is seeking financial aid from US. (Page v)
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CENTRAL INTELLIGENCE BULLETIN
28 January 1961
DAILY BRIEF
USSR:Zviet missile activity in mid-January at the
Sary Shagan Test Complex (SSTC)--including one or pos-
sibly two firings into the complex is a continuation of
anti-ballistic-missile research and development. The
type and quantity of equipment present in this complex
provide part of the basis for estimates that the USSR has
an extensive and high-priority program in the field of
warning and defense against ballistic missile!!
)7,
(Backup, Page 1) (Map)
Laos: (Government forces north of the Phou Khoun
road junction of Routes 7 and 13 have apparently made 0 /1'-
contact with elements of the Communist forces control-
ling the junction; however, a concerted effort to retake
this key position will probably await the arrival from the
south of another government force now at Muong Kassy. I/ s
In southern Xieng Khouang Province the government gar
rison at Tha Thom is said to be bracing for another enemy
-
attack which is expected to be stronger� than two previous
attempts to take the village Two So-
viet AN-12 heavy transpoil ts which left Moscow on
24 January reached Peiping yesterday, and today Ow on to
Canton They may continue to North Vietnam from Canton.
King Savang's willingness, announced by General Phou-
mi, to receive the Indian chairman of the International Con-
trol Commission for Laos removes one obstacle to its re-
activation; nevertheless the USSR continues to show little
inclination to accept the British compromise proposal on
the ICC. Soviet Deputy Foreign Minister Sobolev recently
reiterated to the British ambassador Moscow's support for
the Cambodin proposal for a 14-nation conference.
(Backup, Page 3) (Map)
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from Kivu Province has been in progress for several days. ,
The invaders, who appear to be heading for areas inhabited d'he"
vasion of nor ern Kasai Province by pro-Lumumba forces
' Congo: Two independent reports indicate that an in- 0 Z/2-61::
rn by Lumuba's supporters, are meeting little regi stnnee ip,j ,
from the local police o7 the civilian nopulationT1 )
i : N, Belgian military officials, with the aid ot tne .uetense 1V1111� �,
ks\ istry, are purchasing large quantities of munitions and mil-
l\ itary equipment, including bullet-proof vests, for shipment
to Tshornbe's regime in Elisabethville.
In Leopoldville, a rapid rise in retail prices will probably
lead to further unre y and among the large num-
\ ber of unemployed. (Backup, Page 5) (Map)
N \ USSRIn.donesia: signed in Moscow on January, reportedly calls for the de-
- rc.I'he new Soviet-Indonesian arms deal,
_�
6 e
livery to the Indonesian Army, Navy and Air Force of more
than $244,000,000 in Soviet arms and equipment during the
next three years (1961-63). Although official Indonesian
statements claim that the January agreement provides for
' \ the supply of a wide variety of Soviet equipment, the inclu-
sion of certain items, particularly high-performance jet air-
craft, suggests the listings probably reflect requests as well
ance, including the reported new arms deal and a naval agree-
mentassist-
ance,. of $277,000,000 signed late last year, amounts to almost
$750,000,000 since 1958, and the addition of economic aid
\ would raise the total to almost $1.250 billion, making Indo-
nesia second only to the UAR among non-bloc nations in the
amount of bloc aid received) (Backup,
Page 7) (Charts) ...-i
Albania: Albania's vigorous renewal during the past week
of its thinly veiled public attack on Moscow's foreign policies
and ideological views is the best indication to date that Moscow
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has not succeeded in bringing this Eastern European
satellite back into line. A lead editorial in the Albanian
party daily, Zen i i Popullit, on 20 January reaffirmed
Tirana's contentions on the question of revisionism, pub-
licly condemned bloc leniency toward Yugoslavia, and im-
plicitly criticized Khrushchev and Soviet foreign policy.
Thus, a little more than a fortnight before its party con-
gress, the Albanian party has restated the deviationist
position which its representatives, supporting the Chi-
nese Communist positions, upheld at the Moscow confer-
ence of World Communist leaders.
(Backup, Page 8)
Iran: The Iranian Government, as a matter of policy,
is giWriF little publicity to the current parliamentary
tions through either the local press or radio.
there have been some protests and
demonstrations against the government's rigging of the
elections. Meanwhile, radio propaganda from Moscow
and from the Soviet-sponsored clandestine National Voice
of Iran, beamed from East Germany, has been stepped up
sharply after a five-month lull. The basic theme has been
electoral cornIntion and the Iranian ambassador in MOSCOW
was instructed
to protest the broadcasts.
(Backup, Page 10)
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Saudi Arabia: King Saud seems to be trying to bolster
his position and dissipate Nasir's suspicion of him. Saud,
who has long feared Nasir's capabilities for subversion in
Saudi Arabia and whose withdrawal from active leadership
of his government in 1958 was a result of a controversy
with Nasir, probably feels uneasy and hopes to avoid Nasir's
opposition at this time to his new exoerimert with a relative-
ly liberal cabinet.
CI"he "liberals," whom the King adopted in order to dis-
place his brother, Crown Prince Faysal, as prime minister )
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last December, favor political reform and economic de-
velopment. Several of the King's advisers have warned
that he must move quickly to improve the lot of the gen-
eral populace in order to prevent the growth of opposi-
tion. Some elements in the bureaucracy and merchant
class, who are dissatisfied with recent developments,
are reported to have adopted a "wait-and-see" attitude
toward Saud's new government; some dissident officers
in the Saudi Army and Air Force, however, are probably
continuing their plotting against the reg1me.1
Backup, Page 12)
Tunisia - Arab League: Responding to initiatives of
Iraq, President Bourguiba appears willing to explore
means of ending Tunisia's self-imposed isolation from
the Arab League. Bourguiba now apparently feels that
this policy, adopted when .UAR President Nasir support-
ed Bourguiba's radical opponents, is no longer profitable
in view of Nasir's growing influence in Africa--particu-
larly in Morocco, Tunisia's rival for North African lead-
ership. Bour-
guiba has asked that the Arab League foreign ministers'
conference presently scheduled for 30 January in Baghdad
be postponed in order to allow time for negotiations for
Tunisian participation. , _ ) (Backup,
Page 14)
0 k
*Greece: Greek association with the six-nation Euro-
pean Common Market (EEC)--under negotiation for nearly sa-)
two years with American support--may hinge on the out-
come of the 30 January meeting of the EEC's Council of IL
Ministers. Of the few remaining obstacles to be clearedinLam, `6-�-� c-
up, the most important is Greece's refusal to promise
eventual settlement of its external debts an issue in which ALI;
outside interests, particularly British bondholders, are al- ,P
4_ 4 CLI-4-41-1--e
legedly intervening. Collapse of the negotiations would be
28 Jan 61
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.q,:cheavy blow to the Karamanlis government, and Greek
officials have previously warned that, in the absence of
EEC association Greece will ely even more on
bloc trade:: (Backup, Page 16)
Portugal: Portuguese Government circles continue u/<
uneasy over the seizure of the Santa Maria. The Foreign
Ministry fears Henrique Galvao may try to set up a "Cas-
tro-type government" in Portuguese Guinea or Angola, Z-
where the possibility of defection among white Portuguese
Is beginning to worry Lisbon. 'agr'he regime is also said to
fear Galvao's move will encoura e cleavages among its sup-
porting factions at home, which are reported already plan-
ning to present candidates in next October's general elec-
tions to end the monopoly of the 120 seats in th
Assembly enjoyed by Salazar's National Unio?..D
(Backup, Page 18)
Venezuela: The Venezuelan Government apparently
failed to reach an agreement with the major oil exporting
nations of the Middle East on prorating of export markets
and oil price stabilization during a 16-21 January meet-
ing in Caracas. Without guaranteed markets for its pe-
troleum exports and facing strong competition from Mid-
dle East oil, the government may review its restrictive
policies toward the key foreign-owned oil industry to en-
courage reinvestment and bolster oil revenues. However,
the government is proceeding with the costly long-range
project of developing a "competitive" national petroleum
corporation to engage in all phases of industrial opera-
tions.
President Betancourt, who is committed to moderate
leftist reform, is faced with pressing economic prob-
lems which both rightist plotters and the pro-Castro op-
position have already exploited. illietancourt is seeking
sizable loans from the US--apparently $300 million or more
which the minister of the treasury has frankly stated shoulf.
28 Jan 61
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0 k.
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e on a "political" basis�to reverse the three-year
conomic declin2Z Although serious financial diffi-
ulties were inherited from the excesses of the for-
mer dictatorship and interim junta regime, they are
also partly attributable to Betancourt% reluctance to
risk politically unpopular corrective measures, his
uncertain economic policies, particularly toward the
oil industry, and the frequent political unrest in 1960.
28 Jan 61 DAILY BRIEF
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Moscow.
Si, ling rad. -
1n yor. Rangehead
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MISSILE TEST RANGE FACILITIES
ASSOCIATED WITH SOVIET ANTIBALLISTIC
MISSILE RESEARCH AND DEVELOPMENT
Nscfronyy
Instrumentation site possibly --loo
associated with ABM progrart.5
ICBM Impact Area-�,
Kapustin Yar missile test range
Down range launch points associated with
Sary Shagan test complex operations
. Ty ura
Tam
ICBM /Space
launching facilities
Impact Area 1-1
Sary Shagan test complex
ry Shagan
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Soviet Anti-Ballistic-Missile Activity
Soviet missile activity in mid-January at the Sary Shagan
Test Complex (SSTC)--including one or possibly two firings
into the complex--is a continuation of anti-ballistic-missile
research and development involving SP-5, a launch point
about 500 nautical miles (n. m.) away. There have been four
periods of activity of this type: earlier periods occurred in
late 1958, late 1959, and the summer of 1960; the latest be-
gan on 26 October 1960.
During these periods, firings from SP-5 are controlled
by an organization at Sary Shagan which, among other possible in-
terests, is believed to be collecting re-entry data on missiles
fired into the area and developing components of defensive
systems.
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'4901
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The Sary Shagan complex is known to contain a number of
electronic installations, including six interferometer-type
instrumentation sites, several large radars, and two launch
complexes, one of which contains two surface-to-air (SAM)
sites:I The type and quantity of equipment present in this
confplbx provide part of the basis for estimates that the USSR
has an extensive and high-priority program in the field of
warnine and defense agningt miccilac
The continuation of research on the problems of defense
against short- and medium-range missiles�together with
the limited number of ICBM firings to Kamchatka (a total of
21, including 9 since the summer of 1959) which would pro-
vide re-entry data--suggests that the Soviet anti-missile test
program uses the 1,100-n. m. missile as the primary target
for research and development purposes. The shorter range
missile fired from SP-5 may represent a target for research
and development of a system fnr tiPfensPcfarnimd_frvb.,.c.
units.
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21 JANUARY 1144
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Government forces
Government
Antigovernment
Antigovernment concentrations
Kong Le/Pathet Lao forces
Main route number
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Situation in Laos
A two-battalion government force north of the junction of
Routes 7 and 13 has apparently begun probing the Communist
defengeg around this key position.
, government troops are in
contact with the enemy near the road junction, but the initial
skirmishing is said to have resulted in a standoff, with the
Communists making liberal use of 105-mm. artillery fire.
Communist artillery fire was advanced as the main reason
that the government was forced to abandon the junction on 18
January. Meanwhile, there is a report that the Kong Le -
Pathet Lao joint command is sending reinforcements to the
road junction from the Communist base area at the Plaine
des Jarres-.)
The government column which took Muong Kassy, 25
miles south of the junction, on 25 January has apparently de-
piripa tn cltnv there for the time being.
(lis column had established defensive positions. A
government effort to retake the road junction will probably
have to pumit the arrival o the column presently at Muong
ICassy.
The Communists in the past few days are reported to
have launched two attacks on the government position at
Tha Thom, in southern Xieng Khouang Province. The Tha
Thom garrison expects a third Communist attack at any mo-
ment, and Laotian sources anticipate it will bp pf greater
severity than the first two. Earlier in the week, General
Phoumi had evinced considerable pessimism about his ability
to hold this last remaining government position of any im-
portance in Xieng Khouang Province.
Phoumi announced on 26 January that King Savang was
prepared to receive the Indian chairman of the International
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Control Commission for Laos, in line with the British pro-
posal of 21 January that the ICC take preliminary soundings,
through its chairman, on whether it could perform a useful
role in Laos. The USSR, however, continues to show little
disposition toward supporting the return of the ICC, at least
until some sort of international conference is held on Laos.
eplying to the British ambassador's comment that
Prince Sihanouk had withdrawn his proposal for a 14-nation
conference on Laos, Soviet Deputy Foreign Minister Sobolev
remarked that this was not his government's understanding
and that the USSR still favored the Cambodian nrnnrmal
without US and Thai participation his proposal might
have to be withdrawn. Soviet leaders probably feel that
Sihanouk's plan has provided valuable non-Communist sup-
port for the bloc's diplomatic position and has given the Com-
munists an opportunity to delay any international action or
negotiations on Laos by prolonging East-West exchanges over
the timing. comosition, and agenda of a conference}
The two Soviet AN-12 heavy transports which left Mos-
cow on 24 January reached Peiping on 27 January, and today
flew on to Canton. They may continue to North Vietnam.
Soviet AN-12s--which are heavy four-engine turboprop trans-
ports capable of carrying between 15 and 20 tons of supplies--
have been involved in Laos-associated airlift operations on
two previous occasions. The first group consisting of three
AN-12s arrived in Canton from the USSR on 18 December.
Their cargo was off-loaded and ferried to Hanoi aboard the
Soviet IL-14s which had been engaged in airlift operations
since early December. A second group of seven AN-12s, two
of which were part of the 18 December group--arrived in
Canton on 24 December. Three days later six flew on to North
Vietnam--five to Haiphong and one to Hanoi. One remained
at Canton, apparently because of mechanical difficulty. By 29
December, all six of the AN-12s which arrived in North Viet-
nam were returning to the USSEtz the one delrayed at Canton
returned on 13 January.
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Brazzaville
Luanda
Atlantic
Ocean
-ub ic of the Congo
�Gernena
Congo
Coquilhatville
pso/
28JAN UARY 1961
UNCLASSIFIED
STATUTE MI/ES
Port Francqui
Luluabour;
400
31534
Luput
Bakwanga
.Kamina
Kongolo
Albertville
Manono
�
Elisabethville
rt. t
Albert
Lake
Toriganyilm
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Situation in the Congo
An invasion of remote northern Kasai Province by
pro-Lumumba forces from Kivu Province apparently
has been in progress for several days. According to
two independent reports, the invaders, vilio crossed the
border from Kindu, have taken two large towns. They
reportedly are now split into two groups, one heading
toward the provincial capital at Luluabourg and the other
trying to reach pro.T mmurnba territory in eastern Leo-
nnlrivill P Provincel
most of the area's civil-
ian population supports Lumumba. The police are divided
in their loyalties, although the local military commander
and the provincial government are pro-Mobutu. The invad-
ing force reportedly is meeting little opposition from either
police or civilians.
This is the first offensive operation by Lumumba sup-
porters since the invasioiLof_IKataiie
In the intervening period,
the invaders of Katanga were consolidating their gains.
The new. incursion probably is subject to only tenuous con-
trol by Gizenga in Stanleyville; however, the continued mil-
itary success of forces associated with him is likely to in-
crease Gizenga's following among the Congolese population,
to the detriment of the position of Mobutu and Kasavubu.
Belgian military officials apparently are purchasing
munitions in Brussere ime
in Elisabethville,
immediate shipment
of large quantities of rifle and machine-gun ammunition
was being arranged.
the Belgians were shopping for rifles, grenades,
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smoke bombs, and bullet-proof vests, and that Belgian
Defense Ministry officials were helping to supply gre-
nades, cartridges, and fuzes. Aid on this extensive
scale, coupled With the current effort to provide Belgian
military advisers and to recruit white soldiers in Bel-
gium and elsewhere in Europe, would add greatly to the
military capability of Tshombd's forces.
In Leopoldville, a recent study has shown a marked
upswing in retail prices at the beginning of 1961, and in-
formed observers expect a sharp inflationary spiral.
Prices have risen only gradually heretofore, and eco-
nomic activity in the Leopoldville area has continued, al-
though at a greatly reduced rate. Half the city's labor
force of 120,000 is unemployed, but the needs engendered
by the slowdown in the money economy have largely been
met from the subsistence sector, which has been relative-
ly unaffected by the political turmoil. However, Mobutu's
blockade of the upper Congo River, while it has effectively
cut off supplies of gasoline to Gizenga, has also dried up
the source of about 40 percent of the exports by value which
previously were being shipped through Leopoldville. With
the foreign exchange from these exports no longer available,
and with revenues from export duties reduced, the Leopold-
ville authorities have meager reserves with which to com-
bat inflation.
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MAJOR BLOC ARMS SUPPLIED INDONESIA
(THROUGH 1960)
AIR
IL-28 jet light bombers 20
Other bombers 32
MIG-17 jet fighters 62
Other fighters 24
Other aircraft (including 98
trainers and
helicopters )
LAND
130-mm. truck-mounted rocket 12
launchers
85-mm. antiaircraft guns 25
37-mm. antiaircraft guns 25
NAVAL
Skoryy-class destroyers 4
W-class submarines 2
Submarine chasers 8
10116 2A
28 JANUARY
MAJOR BLOC ARMS TO BE PROVIDED INDONESIA
(1961- 19631
AIR
TU-16 jet medium bombers 20
IL-28 jet light bombers 5
"MIG-21F" jet fighters 20
MIG-19 jet fighters 10
LAND
PT-76 amphibious light tanks 80
BTR-40 armored personnel carriers 130
100-mm. antiaircraft guns 86
57-mm� antiaircraft guns 182
122-mm- field artillery 72
DL-10" landing craft 131
NAVAL
Light cruiser 1
Destroyers 2
Submarines 4
Submarine chasers 8
Minesweepers 6
Motor torpedo boats 10
Armored landing vehicles 60
Amphibious tanks 60
122-mm. artillery 22
10116 26
961
28 JANUARY 1961
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'Details of Soviet-Indonesian Arms Agreement
In the latest recent $244,000,000 Soviet-Indonesian arms
deal, the Indonesian Army's purchases, apparently made un-
der the direction of Chief of Staff General Nasution, consist
largely of light armor, artillery, and infantry weapons. The
purchases underscore the army's efforts to develop its capa-
bilities for antiaircraft defense, as well as for amphibious and
air operations, and constitute--for the first time�acceptance.
of large-scale bloc military assistance by the Indonesian Army.
Clpdonesian naval purchases under this agreement are
limited to miscellaneous equipment, presumably because a
separate naval agreement for the supply of more than $277,000-
000 in Soviet--and apparently Polish--ships was concluded late
last year during Admiral Martadinata's visit to the Soviet Union.
The reported purchases of the air force�apparently made
by Air Marshal Suryadarma, who accompanied General Nasu-
tion on his visit to Moscow in January�seem to be excessive
for Indonesian Air Force needs, suggesting the listing may re-
flect the air force's requests as well as actual Soviet commit-
ments. Although Moscow may be willing to supply some MEG-
19s, it appears unlikely that the USSR would agree to provide
such aircraft as 1111G-21s and TU-16s, which have not yet been
rs_unnliff to the European satellites in quantiti3
In the summer of 1960, Indonesian r ques s or
high-performance aircraft were parried by Moscow with claims
that Soviet Premier Khrushchev hvc fn an-
prove prove of their delivery to Indonesia.
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Albania Criticizes Bloc Policies
In an editorial in the Albanian party daily on 20 Jan-
uary, First Secretary Hoxha spells out in explicit terms
what he meant when he said his party would never com-
promise on questions of principle.
Albania last took public issue with bloc policies on
25 October, when Premier Mehmet Shehu criticized Bul-
garian and Polish disarmament proposals and implicitly
criticized Khrushchev for meeting with Tito while at the
UN earlier that month. Since then, except for restating
its major deviationist positions at the Moscow conference
of 81 Communist parties last November, the regime had
contented itself with defending its views rather than attack-
ing Soviet ones.
Albanian opposition to the USSR first came into the
open at the Bucharest conference of bloc Communist lead-
ers last June, although differences have existed for sev-
eral years. Since that meeting, Tirana and Peiping have
frequently exchanged public expressions of mutual support
and admiration. A high-level eight-man Albanian delega-
tion now is in Peiping, apparently for the purpose of rene-
gotiating existing trade and aid agreements.
The Zen i i Popullit editorial indirectly criticized recent
Soviet statements, particularly Foreign Minister Gromyko's
speech last month to the Supreme Soviet indicating Moscow's
readiness to cooperate with Belgrade and maintaining that
Soviet and Yugoslav positions on "fundamental international
issues coincide." The editorial warned of the dangers inherent
in reaching a "rapprochement" with Tito just because on "cer-
tain basic foreign policy questions. . . the Yugoslav position is
identical to that of the socialist countries."
The editorial also criticized Yugoslav--and by implica-
tion bloc--condemnations of "dogmatism and sectarianism"-
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labels that have been applied to Albania. In a probable
reference to such criticism of Albania�for example,
East German party boss Ulbrichtts public attack last
month on the Albanian leaders--the editorial stated that
many people, including Communists, had been misled
by Yugoslavia.
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Progress of Iranian Elections
.n the current parliamen-
tary elections a deputy was elected "with a majority of
4,556 votes" but "against the wishes of the people." This
reflects the favorite technique of switching ballot boxes.
The same report adds that this caused "an extraordinar-
ily undesirable reaction and shocking propaganda against
the government." Other reports show protest demonstra-
tions and violence, with occasional nongovernmental can-
didates winning.
The current Majlis (lower house) elections in Iran are
for 200 deputies from about 154 constituencies. These
elections were originally held in August after wide pub-
licity proclaiming their freedom. The fiasco which re-
sulted from the inept rigging produced such a volume of
protests that the Shah was forced to cancel the whole elec-
tion.
Prime Minister. Sharif-Emami has told an American
diplomat that in the present round of voting about 50 dep-
uties have been elected thus far, with government "influ-
ence" being used to assure the choice of 25 of them. The
remainder were elected from a list of government-ap-
proved candidates. Sharif-Emami's estimate may be op-
timistic, as he apparently has not been an active partici-
pant in the rigging, a job the Shah has given to the corrupt
and venal minister of the interior, General Alavi-Moqadarn.
lections in key urban areas, including Tehran, have
not yet been carried out. Wide demonstrations and violence
are possible in these more volatile areas if the rigging is
as obvious as elsewhere. Although security forces can prob-
ably control any violence, they may have to use force to do
�TOP SECRET
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so, and this would widen the existing breach between the
government and the people.
Iranian parliamentary elections for the last four, dec-
ades have normally been rigged, if not by the central gov-
ernment then by local authorities. The parliamentary
representatives usually have represented the most influ-
ential person in the constituency, the local landlord, tribal
chief, or military commander. Often the same results
would have been achieved if a genuinely free election had
been held, simply because the people could not have found
anyone more capable of holding the office. With political
awareness spreading to the grass roots, however, tradi-
tional electoral chicanery is becoming more difficult to
carry out.
Soviet propaganda, which was toned down after the
appointment of a new Iranian prime minister in August,
has resumed its hostile tone, apparently to encourage Teh-
ran to make moves toward improving relations with the
USSR. The USSR has sought since 1959 to extract polit-
ical concessions from Iran,such as the prohibition of for-
eign military bases. The renewed Soviet propaganda, keyed
to the rigged elections, is probably designed to exploit pop-
ular dissatisfaction with the voting, Moscow also probably
hopes to force Iran's projected good-will mission to Moscow
to cantPr into nolitieal neantiafinnA
Iran's ambassador to protest the propaganda bar-
rage, which is "wholly at variance with the talks of recent
months d the good will of both sides."
TOP SECRET
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King Saud Courts Nasir
King Saud, who fears subversion by Nasir in Saudi
Arabia, is attempting to improve his relations with the UAR
leader. Immediately after reasserting authority on 21 De-
cember, Saud sent a secret emissary to assure Nasir of the
"progressive" nature of the new government.
The King hoped that
Nasir's brotherly friendship Would last forever."
Saud withdrew from active leadership of his government
in March 1958 after exposure of his clumsy effort to break
up the UAR by attempting to bribe Syrian internal security
chief Sarraj with over $5,000,000. Sarraj denounced the at-
tempt and backed up his charges with photographs of the ac-
tual bank drafts. The fiasco shook Saud's prestige so seri-
ously that Crown Prince Faysa.1 assumed the premiership
upon the insistence of the other Saudi royal princes. How-
ever, Faysal's policy of severe financial retrenchment, al-
though it repaired Saudi finances, became very unpopular
within the royal family and the merchant community. Over
the past two years Saud has thus been able to rebuild his
political stature within the country by favoring the tribes
and siding with the princes who opposed any curtailment of
their purses. To oust Faysal last December Saud obtained
support of Saudi Arabian "liberals" by naming four of them
to cabinet posts. Now for the first time more than half of
the Saudi cabinet is drawn from outside the royal family.
While it would appear that the King has enough backing
among the tribal leaders and within the royal family to sup-
port his new policies, a group of dissident army officers in
late December reauested UAR support for a coup against
Saud, This group planned to
set up an independent state in the western part of the country.
--TOP�SECRE_T_
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While the UAR may not commit itself to any extensive sup-
port for this roup at this time, it may give assistance for a
move later. jisgrunt1ed army officers in Riyadh approached
American military personnel last summer regarding the US
attitude toward an anti-monarchist coup, and educated ele-
ments of the civil population have lone felt that a radical
change of governmeht is needed.
TOP SECRET
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Tunisia May Resume Seat in Arab League
Tunisian President Habib Bourguiba withdrew his repre-
sentative from the Arab League in October 1958�subsequent-
ly breaking relations with Cairo�culminating a long period
of acrimonious exchanges with UAR President Nasir. Bour-
guiba, although under pressures from other Arab states to re-
turn to the League, has refused to do so without significant
concessions from Nasir�notably an agreement that Bourguiba's
rival, Salah Ben Youssef, will no longer be harbored in Cairo,
and a full-scale review by the League of Tunisia's dispute with
the UAR.
Now at odds with the King of Morocco, who excluded him
earlier this month from the Casablanca conference of certain
African and Asian chiefs of state, Bourguiba senses his r
Isolation as Nasir's influence expands in Africa.
Consequently Bourguiba has apparently become
more receptive to recent approaches by Iraqi Premier Qasim
and Jordanian King Husayn proposing that Tunisia attend the
conference of Arab State foreign ministers which convenes in
Baghdad on 30 January.
Mokaddem is slated to re-
main in the tamale bast tor two weeks, ostensibly to chair a
meeting of Tunisian diplomats, and could easily sit in on the
foreign ministers' conference should Bourguiba consider it
expedient to be represented.
TOP SECRET
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Cthe Iraqi foreign minister and Arab diplomats in Bagh-
dad are reported confident that some compromise formula
will be worked out to permit Tunisia's attendance, if only as
an observer":1 Any improvement in Tunisia's relations with
the UAW .-Wwever, is likely to be superficial since Bourguiba
will probably remain suspicious that Nasir desires to under-
mine the Tunisian regime and will continue to fElary hirrmPlf
as Nasir's rival for influence in the Arab world.
-T0P-SEC-RE-7'
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Negotiations on Greek' Link to Common Mai(ket Near Decision
Cit its meeting on 30 January, the Council of Ministers of
the European Common Market (EEC) will probably take crit-
ical decisions on the associations of Greece with the EEC. Com-
promises, which are still subject to council approval, appear
to have been reached on most outstanding issues, but final
agreement may yet founder on Greece's refusal to promise a
settlement of its external debtil
The proposed association arrangement, the result of near-
ly tw �years of bargaining, is generally advantageous to Greece.
Greek industrial exports would receive the same tariff reduc-
tions EEC members extend to each other, and special provi-
sion, has been made for its major export item, tobacco--prob-
ably to the disadvantage of American tobacco exports. Mutual
escape clauses have been provided, but these appear to favor
Greece, and most advantageous of all, Athens would receive at
least $125,000,000 in development loans from the new European
Investment Bank (EIB)
The EIB insists, however, that these loans not be made un-
less Greece agrees to indicate within two years how it proposes
to settle its prewar debts--a condition Athens says is "political-
ly unacceptable." The EIB as a new institution feels it must
protect its credit position, and it has been pressed to do so by
the International Bank for Reconstruction and Development
(IBRD). Greek officials allege, however, that the debt issue
is a subterfuge for those EEC members�notably Italy and the
Netherlands--which are least enthusiastic about Greek associ-
ation and have charged that British "bondholders" are respon-
sible for the pressure from the IBRD, presumably because
London is reluctant to see the Common Market extended?
The ICaramanlis government has committed its prestige to
securing Greek entry into the Common Market on "acceptablO
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kowl
erms," and collapse of the negotiations on the debt issue
would be a serious blow to it. Athens' relations with its West-
ern allies would also be weakened generally, and Greek of-
ficials have warned that in the absence of a relationship with
the EEC, Greek trade with the bloc would probably be accel-
erated. The Common Market would probably also be hurt
politically, because agreement with Greece is widely regard-
ed as a necessary prelude to the opening of talks with other
potential associates such as Turkey, Israel, and Tunisia,
and to renegotiation of the existing association arrangements
with the former colonial areas in Africa-.)
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Impact of Santa Maria Seizure on Salazar Regime
The Portuguese Government evinces growing nervousness
over the political challenge represented by seizure of the pri-,
vatelyAownedPortugueseluxuryliner Santa Maria on 22 January.
It fears in particular that the 70 proclaimed opponents of Prime
Minister Salazar, headed by former army Captain Henrique
Galvao may get through to some port in Africa and try to stir
up trouble among disaffected� groups. The government has
alerted its armed forces at home and in its African provinces
and sent two platoons of paratroopers overseas by air in the
latest of a series of reinforcement moves.
Galvao, who claims to act in the name of former opposi-
tion presidential candidate Humberto Delgado, now residing
in Brazil, is regarded by Lisbon as a determined and capable
adversary. Portuguese Foreign Minister Mathias expressed
apprehension to Ambassador Elbrick on 24 January that Galvao
might take the ship to the Cape Verde Islands or Portuguese
Guinea and try to set in a "Castro-tvne government" on the
west coast of Africa,
palvao's action
probably foreshadowed a coup attempt against some part of
the overseas provinces and emphasized the need for cooperat-
ing with the milJtAry in order to prevent a surprise landing.
Lisbon feels there is no doubt about
the loyalty of the officer corps but is apparently less sure of
the attitude of some sectors of the noncommissioned officers.
� Galvao and Delgado have for many months been coordinat-
ing antiregime plans among Portuguese exiles in Brazil, Vene-
zuela, and apparently other areas in Latin America. Their
primary objective reportedly has been to gain strong support
from opposition groups in both Portugal and Spain and eventual-
ly effect armed landings in either country to oust Franco and
Salazar. The two men are said to have received financial
-TOP-SECRE T
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aid of unknown amounts from sympathizers in Vene-
zuela.
Delgado enjoyed considerable support at home in the
African provinces during the presidential election campaign
of 1958. Galvao also has been held in high esteem among
opponents of Salazar in Portugal and even, reportedly,
among some high-ranking officers. However, the US Em-
bassy in Lisbon reports that local press disclosures that
most of the 70 men involved in the seizure of the Santa
Maria were Spaniards has already dampened what public
admiration Galvao's "theatrical gesture" may have generated.
The Salazar regime appears concerned over possible de-
fections by white Portuguese in Angola who are in favor of
Independence for the province and might work with African
nationalists to secure it, e also probably fears that Galvao's
move may encourage cleavages among its supporting factions
which are reliably reported already planning to offer their
own candidates for the National Assembly elections next Oc-
tober'.3 Capture of even a small number of seats would end
the Monopoly of the 120 seats in that body hitherto enjoyed
by the regime's National Union.
Another factor probably increasing the nervousness in
government circles is the current partial incapacitation of
Salazar. he 71-year-old dictator is regarded not to have
fully recovered from the mild attack of pneumonia he in-
curred early this month.
TOP SECRET
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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
Director, Office of Civil and Defense Mobilization
Director, National Aeronautics and Space Administration
Chairman, Board of Consultants on Foreign Intelligence Activities
Executive Secretary, National Security Council
The Department of State
The Secretary of State
The Under Secretary of State
The Deputy Under Secretary of State for Political Affairs
The Deputy Under Secretary of State for Administration
The Counselor
Director, International Cooperation Administration
The Director of Intelligence and Research
The Treasury Department
The Secretary of the Treasury
The Department of Defense
The Secretary of Defense
The Deputy Secretary of Defense
Assistant Secretary of Defense (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
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
Commandant, United States Marine Corps
Assistant to Secretary of Defense (Special Operations)
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
Atomic Energy Commission
The Chairman
Federal Bureau of Investigation
The Director
National Security Agency
The Director
National Indications Center
The Director
--GONFIDEN TM L
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