Document Type: 
Document Number (FOIA) /ESDN (CREST): 
Release Decision: 
Original Classification: 
Document Page Count: 
Document Creation Date: 
January 27, 2020
Document Release Date: 
January 30, 2020
Sequence Number: 
Case Number: 
Publication Date: 
July 1, 1958
� ;-, rrtio # WZ/Z/Z/Z/7/ 71 V/ 'Approved for Release: 2020/01/23 CO2987874 -T-O-P-5-EVRET Nine 1 July 1958 3.3(h)(2) 3.5(c) 0,4 'Yz Copy No. C. 5 7 CENTRAL INTELLIGENCE BULLETIN DOCUMENT NO. _ NO CHANGE IN CLASS. I I DECLASSIFIED CLAOS. CHANGa) TO: TS SCA NEXT REVIEW DA 5: AUTH: I-IA D/V _ REVIEWER: -TOP-SECRET- Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 1 JULY 1958 I. THE COMMUNIST BLOC Ithrushchev may attend East German party congress to show support of Ulbricht. Chinese Communists demand renewal of talks with US at ambassadorial level.� II. ASIA-AFRICA Lebanon - Heavy fighting near Bei- rut on 30 June. Opposition leaders claim they can no longer count on aid from UAR. Turkey reinforces patrols on Syrian border. Sudanese premier says opposition has offered to bring Sudan into UAR if Nasir helps overthrow Khalil in 3 July vote. Cyprus - EOM threatens new vio- lence unless British talk with Malcarios. tyr TOP SECRET 0 Morocco decides in principle to es- tablish early diplomatic relations with USSR and recognize Peiping. � Indonesia - Menado dissidents with- draw into hills for guerrilla action. 0 Taiwan - Chinese Nationalist vice president becomes premier. III. THE WEST � France - Reshuffle of army leaders suggests De Gaulle expects difficulty lining up military support for Algerian policy. LATE ITEM O Soviet offer to discuss economic relations with Belgrade makes no concession but seems intended to ease tension. Approved for Release: 2020/01/23 CO2987874 \\A\\N\\ upo' Approved for Release: 2020/01/23 CO2987874 11 �JrAJL CA.e111.1" 111101 k.� L\\\�" xx\x\x\x\xx\x\xxxxxxxv\x\Z\\\x\t\\\\\\\x\ xx\x\x r. 1 F1P142 .7 East Germany: Premier Khrushchev may attend the East German fifth party congress which is to be held 10-16 July. This is suggested by an Austrian announcement that le Chancellor Raab's visit to the Soviet Union, originally sched- O n uled to begin 13 July, has been postponed one week because Khrushchev "will be abroad." The Kremlin might wish to demonstrate again is support for party leader Ulbricht. (Page 1) *Communist China: Peiping's declaration that the US must resume Sino-American ambassadorial talks "within 15 days" carries an implicit threat that the Communists 0 ri may increase their pressure in the Taiwan Strait area. (Page 2) O/) II. ASIA-AFRICA Lebanon: Heavy fighting developed 10 to 15 miles south- east of Beirut on 30 June. A UN source says rebel leaders claim they can no longer count on UAR support, but a UN ob- server report acknowledges presence of Syrian military per- sonnel directing operations in Lebanon. General Shihab is recruiting tribesmen for the army to keep them from joining the rebels. (Page 3) CENTRAL INTELLIGENCE BULLETIN 1 July 1958 DAILY BRIEF I. THE COMMUNIST BLOC Turkey-UAR: In an attempt to insulate its southern bor- der against UAR incursions, Turkey is moving a cavalry di- vision, infantry elements, and small tanks to the area to Approved for Release: 2020/01/23 CO2987874 eM\}N\' Release:I}M INIP\VN \\\ \\\\\\\NNX\W\N\W\ � %,,A oris..irtra 1/4\ t � t 0 Ls I k 1 july 58 TOP SECRET DAILY BRIEF a 4, IAD supplement gendarmerie patrols. Part of the border will also be mined. The Turkish Government is irritated over recent attacks by armed Syrian bandits which took place 15-25 miles inside Turkey. (Page 5) (Map)' Sudan-UAR: Prime Minister Khalil says opposition political leaders have promised Nasir to bring the Sudan into the UAR, provided he helps them oust the present pro- Western coalition government. Khalil faces possible defeat in a parliamentary vote set for 3 July on acceptance of the government-sponsored American aid program. The opposi- tion is making a major effort to buy Votes, probably using Egyptian-supplied funds. (Page 6) Cyprus: Communal clashes again broke out on 29 June but were halted by British security forces. E01CA has in- structed its followers to hold off temporarily, but threatens to renew violence against the British unless London begins direct negotiations with Archbishop Makarios on the question of "independence" for the island. In Turkey the press is less inflammatory, but mass meetings, with highly emotional orators, continue to be held under tight security control. Morocco-USSR: The Moroccan Government decided in /, principle on 23 June on the early establishment of diplomatic 14) relations with the Soviet Union and on the extension of official recognition to Communist China. (Page 7) Indonesia: Dissident leaders, after evacuating Menado apparently with most of their forces intact, have set up new headquarters in hilly terrain to the south for the purpose of lc conducting large-scale guerrilla warfare. The Chinese Na- ' tionalists are said to be planning to support this effort and have already flown in some supplies and provided limited air support. (Page 8) Approved for Release: 2020/01/23 CO2987874 N \\xxxxx\x\xx\x\-x\\x\x\xxm Approved \A\ xxx\xxxxxxxx xxxxxxxxxxxxvx\\ \\vx, 1 � wil 0 , for Release: 2020/01/23 CO2987874 1 VI-- JEt-rcLI W N New Chinese Nationalist premier: The appointment of Cheh"Chwm considered the, second most powerful man on 11 Taiwan, as premier of Nationalist China further bolsters his prospects as successor to Chiang Kai-shek. The first task of Chen, who presumably remains vice president as well, probably will be to tighten the discipline of the ruling Kuomintang, which in recent months has failed to support Chiang on policy matters which he considered vital. 1 (Page 9) France: Premier de Gaulle may anticipate stiffer op- position from junior army officers, who favor a firm line on Algeria. The premier seems to be making key personnel appointments to lull and control, unrest among "the paratroop colonels." (Page 10) ss, il *USSR-Yugoslairiai Moscow appears to have shifted from I 1 0 is designed to counter 1 1 precedes Nasir's visit to Tito ad is its 77 - ugh tactics with the Yugoslays in offering to discuss charges that Soviet economic assistance is dependent upon seveeal questions concerning ecoucmic relations. The move r()\ political considerations. It follows Gomulka's recent co L promise on the Nagy issue and may also have been intended as a tactical relaxationge of the bloc's political atmosphere. (Pa 11) 16 S'\.\\.\\\ :1 1 Ally 58 k\k\ TOP I L\\L\N \\v\xx\x\x\xxx\x\xk\x\xxx\\\\x\\\\\\N\&\\x\\\xxx\\\\ III. THE WEST LATE ITEM DAILY BRIEF iii Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 1 AA A I. THE COMMUNIST BLOC Khrushchev May Attend East German Congress Premier Khrushchev may attend the East German fifth party congress, to be held from 10 to 16 July. This is sug- gested by the Austrian announcement that Chancellor Raab's visit to Moscow, originally scheduled to begin 13 July, will be postponed for one week because the Kremlin leader "will be abroad." Khrushchev has already gone to East Germany once during the past year to support Ulbricht against strong in- ternal party opposition. Ulbricht's fight against his political opponents, which was intensified by the Schirdewan purge in February, has most recently been manifested by reorganization of the party at the district level designed to present a unified front during the congress. Ulbricht is said to fear that a continuing con- troversy over the Schirdewan affair may erupt at the congress and demonstrate his party's disunity to an embarrassing de- gree. Ulbricht, apparently emboldened by Nagy's execution, reportedly would like to bring to trial at least one Schirde- wan sunnorter former Security Minister Wollweber. SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 1 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 %..A../1 NI" IL/Cal I ItL. mar' Moir' Peiping's Demand for Sino -American Talks Communist China's official warning on 30 June that the United States must resume talks at the ambassadorial level "within 15 days" or Peiping will regard the talks as broken off carries an implied threat of increased Commu- nist: pressure in the Taiwan Strait area. The statement charges that continuing US "occupation" of Taiwan is "a naked act of aggression... and the Chinese people have the full right to take .whatever measures to repulse it." Sino -American ambassadorial talks were carried on for more than two years at Geneva, but have been in abeyance since last December when Ambassador Johnson was reas- signed. The Chinese have refused to meet with an American below the rank of ambassador. In its note, delivered to the US Consulate General in Geneva and broadcast over Peiping radio, Peiping pro- claimed that "the Chinese people are perfectly strong enough to liberate their territory of Taiwan" and that the US can only suffer "isolation and defeat" in its policy of "enmity" toward Communist China. 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 2 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 TOP SECRET II. ASIA-AFRICA Lebanese Situation Kamal Sumblatt's Druze forces on 30 June launched an at- tack against progovernment irregulars in the mountains five miles east of the Beirut International Airport. Heavy fighting began in the early morning hours and continued throughout the day, with the Lebanese Air Force mounting rocket attacks against the invading Druze. American and British women and children were hurriedly evacuated from the area. Jumblatt is disgruntled with rebel leaders Saib Salam in Beirut and Rashid Karami in Tripoli because of their failure to join in an all-out offensive against Beirut. Many opposition fighters are also said to be discontented with their leaders, who are not actually fighting. The followers of one Shia Moslem leader are disgruntled by Syrian aid to Sunni Moslems, who, in turn, are alarmed at ,e large arms deliveries to Lebanese Druze. Another indication of dissension within rebel ranks is the public defection of the son of a prominent Shia Moslem antigovernment leader f-orla southern Lebanon. Army commander General Shihab has reached an agree- ment with tribal leaders in the Biqa Valley whereby tribes- men will be "inducted" into the army as reservists. For the Lebanese military forces, the arrangement will prevent rebel Inroads among friendly and uncommitted tribesmen and will, increase the rebel difficulties in controlling the northern Biqa. Basically, the arrangement is to bribe the tribes. Prisoners interrogated by the UN observation group have stated that Syrian military personnel have been actively en- gaged in operations against Lebanese security forces, as well as carrying out demolition activities. the UN group, after contacts with rebel leaders, claims they had received word they could "no longer depend on any assistance from the outside." UN Secretary General Hammarskjold has concluded from this that orders have gone 1 July 58 TOP SECRET CENTRAL INTELLIGENCE BULLETIN Page 3 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 DUrr ,itare Nine out from Nasir to halt UAR aid to the rebels and that Nasir's trip to Yugoslavia is "a good sign." The secretary general's optimism appears to be unwarranted, however, since UAR intervention in Lebanon was stepped up when Nasir visited the USSR, and the rebels have sufficient supplies of materiel to continue their operations for some time. Lebanon's economy has been further weakened under the pressure of continuous stagnation as a result of the rebellion. Employers who have been paying idle and near-idle workers in an effort to keep them from joining street mobs are now becoming unable to do so. Government officials believe that , soon as many as 20,000 workers will be on the streets without any means of support. Large numbers of merchants and industrialists have nearly exhausted their liquid funds and are'borrowing to meet current expenclitures. The banks, however, are unable to supply funds in the required quantities. The central bank, in an effort to ease the liquidity shortage, reportedly has expanded the note issue by about 10 percent in the past few weeks and could in- crease the notes in circulation by an additional 14 percent within the next several days. Should these actions fail to halt the drop in liquidity, the Lebanese pound could quickly suffer a crisis nf ennfirieneP and a run for foreign exchange might oc- cur. TOP SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 4 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 � Karabuk lskender Latak Baniyas Cyprus (U K) Tripp LEBANON ' Beim Won frOamascus ISRAE Tel Aviv Amman 80630 3 P,t) Aleppo Batum Ar Riitbah Sarikamis AXE VA% Karbala L,to� h na n aghdad ichey n 1 JULY 1958 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 iJ I.Let of LE:al� 'Noe '1WP' Turkey Moves Troops to Counter Syrian Banditry The Turkish Government is secretly moving a cavalry division from northeastern. Turkey to the south-central border with Syria to reinforce gendarmerie patrols and to prevent the UAR from creating disorders. The transfer will be completed by 20 July Some infantry elements from the VII Corps are also being shifted to the border area, 62 miles of which are being mined eastward from the Euphrates River. Small tanks will also be used to patrol the border. These movements are prompted by recent armed bandit attacks on trucks, buses, and cars on the road between Urfa and Mardin near the Turkish-Syrian border, Some of the bandits who came from Syria were carrying Czech revolvers when arrested. Prime Minister Menderes called a special session of the cabinet to discuss the incidents. The general problem of border security was considered by a meeting on 26 June of high-ranking military officers, including members of the Turkish general staff, the deputy commander of the gendar- merie, and the commanders of the First, Second, and Third Armies. The minister of the interior and the commander oi the gendarmerie have been in southern Turkey since 24 June. In addition to being highly incensed over this cross-border banditry, Turkey seized on it probably as justification for further strengthening border defenses in an area where mech- anization would be of little value. Turkey fears that if the Leb- anese situation continues to deteriorate, it too may be faced with danger from Syria. $'1'77 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 5 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Naze ,ftee Sudanese Government Under Egyptian Pressure The coalition government of Sudanese Prime Minister Khalil will undergo a severe test of strength when it at- tempts to push through approval of the American aid pro- gram in Parliament on 3 July. Khalil appears confident of winning by at least a small majority, but an intense struggle is going on to win the votes of wavering or uncommitted mem- bers of the 173-man house of representatives. Khalil has stated that opposition leaders have sent a declaration to UAR President Nasir urging his assistance and promising in re- turn to join the Sudan with the UAR if the present government is overthrown. They are alleged to be offering bribes of as much as $1,500 for each vote against American aid, with funds probably furnished by the UAR. Failure to win the Parliament's approval would probably mean the end of the present coalition made up of Khalil's Umma party and the People's Democratic party. In this case, Khalil, as leader of the largest party in the govern- ment, might be compelled to try to form a broader "nation- al" government, including participation by the pro-Egyptian National Unionist party, with a decidely more "neutralist" posture. A victory by only a small majority might also be followed by a change in the coalition, with Khalil bringing pro-Umma southerners into the government and expelling the dissident members of the People's Democratic party. SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 6 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 aL.A....11.0 Noe %Iwo' Morocco Considering Early Exchange of Ambassadors With 'USSR and Communist China The Moroccan Government decided in principle on 23 June to establish diplomatic relations with the Soviet Union soon, The govern- ment is also expected to announce "official recognition" of Communist China in a few days; diplomatic relations are expected soon thereafter. Moscow will probably press for immediate exchange of diplomatic missions, once Rabat agrees to relations, and can be expected to move quickly to persuade Tunisia to follow suit. Soviet embassies in both Rabat and Tunis would make possible closer coordination of the USSR's policies in France and North Africa. The Soviet and Chinese Communist mis- sions would be the first bloc missions in North Africa. Morocco's recognition of Communist China might well stimu- late Peiping to press other African countries to consider similar steps. In April, a Moroccan economic delegation negotiated a trade agreement in Moscow, and a second Moroccan economic mission left last week for the USSR to discuss implementation of the trade agreement. A three-member Soviet economic mission was recently established in Casablanca and is at- tempting to expand the import of Soviet products�notably pe- troleum and lumber--by Morocco. A Moroccan parliamentary delegation made an official visit to Peiping in April 1957, and a Moroccan economic mis- sion concluded a trade agreement with Communist China in October. The Moroccan delegation to the United Nations in September came out in favor of Peiping's admission to the United Nations. SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 7 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 'Noe Situation in Indonesia The North Celebes dissidents, after evacuating Menado on 26 June with most of their forces, have established new headquarters in hilly terrain about 20 miles south of their former capital from which they plan to conduct extensive guerrilla warfare. In Djakarta, Prime Minister Djuanda admitted on 28 June that the government still faces heavy opposition in North Celebes despite the fall of Menado. The dissidents are being aided by the Chinese Nationalists in their effort to continue armed opposition to the Djakarta government. Chiang Ching-kuo, Nationalist China's security chief, reportedly stated his government would give the dis- sidents as much support as possible and would continue to use Sanga Sanga air base in the southern Philippines for re- fueling. Some aid, mostly arms and medical supplies, has already been airdropped, a Chinese Nationalist B-26 transited Sanga Sanga on 26 and 28 June., In Sumatra, the government apparently has sent addition- al troops to the Medan area in an effort to control dissident guerrilla activity there. Army Chief of Staff General Nasution ordered armed guards placed on estates to protect them from dissident attacks, now increasing in intensity. He said orders had al- ready been given to prevent damage to oil fields. SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 8 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Nekol New Chinese Nationalist Premier Chiang Kai-shek's selection of Vice President Chen Cheng to replace O. K. Yui as Chinese Nationalist premier probably is designed to re-establish discipline within the ruling Kuo- mintang and assure that party members in the legislature will support the government. The esteem Chen enjoys as a highly respected old-line party leader should aid him in ac- complishing this task. Chen's nomination further strengthens his position as Chiang's successor. Chiang last October appointed Chen deo., uty director general of the Kuomintang, apparently with the intention of naming Chen to succeed him as leader of the party as well as to the presidency. Chents new position, which he presumably will hold along with his other posts, may help fore stall a power struggle over the succession. Yuits ouster had been expected since last February, when Chiang reprimanded him for "dereliction of duty" following his impeachmeLit by the Control Yuan--the inspectorate branch of the government. Yuirs resignation will be followed by some other cabinet changes, but there will not be a large-scale reorgani- zation. 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 9 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Novi 1110 THE WEST De Gaulle Moving to Tighten Control Over Army in Algeria Premier de Gaulle's sudden decision to replace army Chief of Staff Lorillot by General Andre Zeller may reflect concern over repotted unrest among young officers in Al- geria. Armed forces Chief of Staff Ely is said to be "very upset" at the state of mind of the junior officers, who are increasingly mixing in politics. Lorillot is unpopular with many officers because he had accepted Ely's job under Pre- mier Pflimlin. Zeller had resigned in 1955 from the post to which he has just been reappointed in protest against the lack of government support for the army and operations in Algeria. Ely was very displeased by General Salan's recent ac- tion in appointing generals as prefects in Algeria without government authorization, Salan is reported unduly influenced by a group of colonels who engineered the 13 May move. Ely said General Pierre Garbay, a devoted Gaullist, may be ap- pointed chief of military operations in Algeria as a counter- balance to Salan. Garbay is a stern disciplinarian who could be expected to crack down. Jacques Soustelle told CBS correspondent David Schoenbrun on 27 June that he expects shortly to be named minister of state for Algerian affairs. Such an appointment would be hailed by the extremist settler and military elements in Al- geria, who are unaware that Soustelle actually favors eventual internal autonomy for Algeria. SECRET 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 10 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 Noe LATE ITEM USSR Proposes Economic Talks with Belgrade Moscow's offer to Belgrade to discuss "several questions concerning economic" relations in light of the USSR's 27 May suspension of its credit agreement with Yugoslavia repre- sents a shift from the rough tactics Moscow has been using recently in an effort to forge bloc unity. The Soviet pro- posal apparently was timed to precede Egyptian President Nasir's visit with Tito in order to demonstrate that economic relations with Moscow are not dependent on political con- siderations. The tone of the announcement is one of reasonableness and correctnes bearing out Khrushchev's statements on 3 June at t__e Bulgarian party congress that even if party re- lations with Yugoslavia were impossible, he wanted "normal state relations." The Albai ians and Czechs, in a joint com- cLunique issued on 30 June at the conclusion of a six-day visit by the Czech premier to Tirana, said that they had agreed to maintain state relations with Yugoslavia as long as they are both "mutually profitable" and "in agreement with the interests of the socialist camp." The 27 May loan suspension had little effect on current Yugoslav - Soviet bloc economic relations. Trade on cur- rent account was not interrupted, and only Soviet and pos- sibly East German credits for economic development were suspended. The Yugoslays had scheduled the utilization of only a portion of these credits, possibly because of cau- tion engendered by the USSR's suspension of credits in 1957 during an earlier stage of the ideological conflict. The Soviet announcement of 30 June does not reinstate the sus- pended credits. The new proposal repeats an offer-- ' 1 July 58 CENTRAL INTELLIGENCE BULLETIN Page 11 Approved for Release: 2020/01/23 CO2987874 Approved for Release: 2020/01/23 CO2987874 LAJArtiuziv 11AL `,�Epoe originally made when the credits were canceled--to discuss with the Yugoslav Government the cash sale or barter of those items obligated or contemplated under the credits. Following Gomulka's recent compromise statement on the Nagy question, the Soviet proposal to the Yugoslays may have also been intended as a tactical relaxation of the politi- cal atmosphere in the bloc. Polish fears that Moscow intends to put immediate economic pressure on Warsaw to conform fully to bloc policies may be somewhat relieved. The Poles, however, are unlikely to assume that any slackening has oc- curred in Moscow's basic policy designed to achieve bloc unity. 1 Iuly 58 CENTRAL INTELLIGENCE BULLETIN Page 12 Approved for Release: 2020/01/23 CO2987874