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March 6, 1961
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If Approved for Release: vino" I U Nsor 6 March 1961 Copy No. C CENTRAL INTELLIGENCE BULLETIN (b)(3) .7 1--70P�SECR5/ Approved for Release: 2016/07/05 C03007378 AApproved for Release: 2016/07/05 C03007378 TOP-SEGREL__ The Daily Brief of the CENTRAL INTELLIGENCE BULLETIN is produced by the Director of Central Intelligence in consultation with representatives of departments and agencies of the United States Intelligence Board. Back-up material is produced by CIA with as much consultation with other departments and agencies as is practicable. When, because of the time factor, consultation with the department or agency of primary concern is not practicable, the brief will be produced by CIA and marked with an asterisk. Intelligence in this publication is based on all sources, including Interpretations of intelligence information in this publication rep- resent immediate and preliminary views which are subject to modi- fication in the light of further information and more complete analysis. Certain intelligence items in this publication may be designated specifically for no further dissemination. Other intelligence items may be disseminated further, but only on a need-to-know basis. WARNING This document contains classified information affecting the national security of the United States within the meaning of the espionage laws, US Code Title 18, Sections 793, 794, and 798. The law prohibits its transmission or the revelation of its contents in any manner to an unauthorized person, as well as its use in any manner prejudicial to the safety or interest of the United States or for the benefit of any foreign government to the detriment of the United States. Approved for Release: 2016/07/05 C03007378 (b)(3) (b)(3) Approved for Release: 2016/07/05 C03007378 /// / ,0/ /4 Niro 6 March 1961 CENTRAL INTELLIGENCE BULLETIN CONTENTS 1. Situation in the Congo. (Page t) 2. Laos: Souvanna Phouma reported planning to leave on world tour this week. (Page i) 3. Pakistan and USSR sign agreement on oil exploration. (Page 4. West Germany revalues the mark. (Page JO 6. Panamanian delegate to "peace conference may intro- duce resolution on Canal Zone sovereignty. (Page iii) / Approved for Release: 2016/07/05 C03007378 'Approved for Release: 2016/07/05 C03007378 %NO `4,11ii CENTRAL INTELLIGENCE BULLETIN 6 March 1961 DAILY BRIEF *Congo: The situation in the Banana-Matadi-Kitona area remains teilse, and the 120-man Sudanese garrison at Matadi has withdrawn to avert further clashes. Congolese forces ap parently have ignored a cease-fire negotiated earlier by UN special representative Dayal and Congolese Foreign Minister Bomoko. UN Secretary General Hammarskjold, following a two and a half hour emergency meeting of the UN's 18-nation Congo advisory committee, is reported to have ordered the UN commander to meet today with Congolese military leaders in an effort to restore UN control in the area. Dayal confirmed on 4 March that he had orders from Hammarskjold to hold Banana and Kitona at all costs, and to retake them if lost,by force if necessary. Brussels radio has announced that Gizenga and ICashamura will attend the round-table conference called by Tshombe which is to begin on 6 March in Tananarive. Tshombe, ICalonji, and Ile� arrived in Tananarive on 4 March, and Kasavubu reportedly will join them on 6 March, following a plea from Tshombe that the conference would not succeed without him. The conference Is unlikely to result in more than broad agreements to cooperate on "unifying" the Congo. The proclamation on 4 March of the State of Maniema, in Kivu Province, by Antoine Omani is prob- ably an effort on his part to align himself with the anti-Communist grouping of Tshombe, ICalonji, and Ileo announced on 28 February. It is doubtful that Omar controls enough of Kivu Province to make this move significant. Laos: Th'ormer Laotian premier Souvanna Phouma is report- edly�Fa�ming to leave Cambodia between 7 and 11 March on his world tour seeking support for his "legal" government. Former finance minister Inpeng Suradhay is still trying to arrange talks between Souvanna and General Phoumi. Inpeng, who arrived in Vientiane and Luang Prabang during Souvanna's recent visit ti53 (b)(3) -SEVRET___ Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 SEeligT, NIIle 5ebel-held territory, planned an early return to Phnom Penh to convey Phoumi's willingness to meet Souvanna, possibly in Rangoon73 ei team from Taipei was expected to arrive in Bangkok by 6 March to negotiate arrangements for the repatriation of Chinese Nationalist irregular troops from the Thai-Burma-Laotian border area. The team plans to visit villages in Laos and Thailand, where Irregulars crossing over from Burma have concentrated, to per- suade as many as possible to return to Taiwan. Although a Lao- tian government spokesman has stated that Kuomintang elements in Laos are now being disarmed, in the border area has reported seeing a well-armed unit in his village. about 1,000 ir- regulars enc m eci in northern Thaziana m v nave crossed back Into Burma. Pa1ustan-1.M1-.: The agreemen on oi exp o ation signed in Karachi on 4 March after several months of bargaining is the first major Soviet aid program accepted by the Pakistani Government. The agreement provides for a credit of $30,000,000 to finance a five-year program of technical assistance in oil prospecting and surveying. The credit carries the usual favorable terms- repay-] znent over 12 years at 2.5-percent interest. Pakistani officials, impressed by the discoveries of Soviet teams in India and Afghan- istan, hope that the Soviets will succeed where Western oil com- panies have failed. Leaders of the military government probably are also motivated by political considerations. While maintaining Pakistan's commitment to its Western alliances and continuing to rely strongly on US aid, President Ayub and his associates have sought in recent months to demonstrate a greater "independence" in foreign policy as a reminder that Pakistan's cooperation should not be taken for granted. (Backup, Page 3) West Germany:On a sudden move, Bonn has raised the ex- change value of the West German mark 5 percent in an effort to V halt the steady influx of foreign exchange�chiefly dollars--which has contributed to US balance=of-payments difficulties. The Netherlands has announced that the guilder is being similarly revalued. Althoughi 6 Mar 61 DAILY BRIEF ii (b)(3) Ii (19)(3) Fl // -SEeREZ, z Approved for Release: 2016/07/05 C03007378 - Approved for Release: 2016/07/05 C03007378 is ,SZ6RET Nirse it Ceerman government and banking �flit ials�under strong pres- sures from industrial and commercial interests�had re- peatedly rejected revaluation, the failure of Bonn's recent easing in its tight monetary policy to correct West Germany's chronic billion-dollar payments surplus and the threat of another wave of speculation apparently convinced Bonn offi- cials that a more realistic pegging of the mark was unavoid- able. This action which applies a brake on inflation but also makes German exports more expensive May be intended to demonstrate Chancellor Adenauer's willingness to take additional steps to ease pressure on the dolla9 Latin America:CA demand for full Panamanian sovereignty in the Canal Zone is likely to be one of the propaganda highlights of the Communist-backed "Latin American Conference on National Sovereignty, Economic Emancipation, and Peace;' meeting in Mexico City from 5 to 8 March. Pro-Castro deputy Thelma King, head of the Panamanian delegation, reportedly will introduce the resolution on the Canal Zone and another condemning US "aggres- sion against Cuba." The conference is sponsored principally by former Mexican President Lazaro Cardenas, a Stalin Peace Prize winner whose prestige as a revolutionary is high in Latin America, although he has allowed himself to be used increasingly by both Castro and the Communists. 6 Mar 61 (b)(1) (b)(3) N.' ski /e--- (b)(3) DAILY BRIEF iii � Approved for Release: 2016/07/05 C03007378 Brazzaville,n. Banan � �Kitona Matadi SUDAN 390 Approved for Release: 2016/07/05 C03007378 IN 1,150 MALAYA 150 Gem era TUNISIA MALAYA 610 MOBUTU 7,200 Scattered Forces - MOBUTU 1 2,700 Coquilhatville �Boende Scattered Forces Leopoldvipe- - Thysville : GHANA 1,900 {4)Luanda Approximate area controlled by: Ti Kasavubu-Mobutu Gizenga Kalonii Ishombe M United Nations Forces Selected road Selected railroad Selected airfield X Cut railroad STATUTE MILES MOBUTU 31594 C 1,500 t Francqur, uluabourg Bakw Luputa MOROCCO, IRELAND 655 LIBERIA ETHIOPIA Kamina- .404 w AA. a ETHIOPIA GIZENGA 7,000 NIGERIA ongb175 Albertville.- NIGERIA CManono SWEDEN 680 TSHOMBE 4,000 Elisa hviIle Usumbura Lake Tanganyika 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Map Page 0 (b)(3) Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 SregE4:L Situation in the Congo The fighting around Banana has resulted in casualties on both sides--which will make it even more difficult for either UN or Congolese forces in Leopoldville to control the situation. Congolese troops have used artillery, mortars, and even a small amphibious operation against the Sudanese UN forces0 the incident could touch off fighting else- where. 3e1g1um will not insist on tne departure of the Belgian military, paramilitary, and polit- ical personnel who are under contract to the Katanga govern- ment. Military technicians not under contract�probably about 40 in various ministries of the Katanga government-- apparently will be recalled, however. Tshombe would react strongly to such a move. Gizenga, after having indicated several times that he would not attend the Tananarive conference, informed UN of- ficials on 4 March that he was eager to participate and asked the UN to furnish transportation. The conference, originally planned for Geneva, was suddenly reset for Tananarive on 1 March�apparently without the Malagasy government's having been consulted. There is no known agenda, but some reports indicate that the conference will last for six days. Malagasy President Tsiranama, who apparently will take no part in the meetings,on 3 March broadcast advice to the population to receive the Congolese as brothers but not to take sides with any faction. Meanwhile, Gizenga continues to explore ways of getting outside help for his hard-pressed regime. --sEeRgz, 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 1 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 .4.0:TOP�SEC1.1t,cr (b)(3) 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 2 (b)(1) (b)(1) (b)(3) (b)(3) Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 SE`U4 lisp/ Pakistan and USSR Sign Agreement on Soviet Aid in Oil Ex- ploration Agreement in principle on the Soviet credit was reached in Moscow in December during the visit of the Pakistani min- ister of fuel, power, and natural resources, but consumma- tion of the deal was delayed pending further negotiations in Karachi. Pakistani officials had originally hoped that Moscow would agree to share the expense of exploration if oil is not found--Pakistan paid only 25 percent of the cost of explora- tion undertaken by Western oil companies--but this idea was promptly dismissed by Soviet negotiators. Pakistani officials also pressed for even more favorable credit terms than they received, including repayment in nonconvertible rupees. In the end Pakistan apparently conceded its main points, al- though the Soviets, in agreeing to rupee repayment, probably assured Pakistani officials that Moscow would not demand conversion to hard currency unless acceptable exports were not available. The Soviet ambassador recently discussed publicly the possibility of additional assistance in such areas as atomic- energy development for peaceful purposes, medical training, and agrarian problems. He also expressed hope that a cul- tural agreement would be signed. Pakistani officials have shown some reluctance with regard to further aid programs, but conclusion of the oil deal may make it difficult for them to turn down publicized offers in the social welfare field, because these are keyed to popular demands and have stirred considerable public interest. Despite President Ayub's repeated reaffirmation of Pakistan's pro-Western foreign policy and commitment to the CENTO and SEATO alliances, neutralist tendencies have been increasingly evident in government circles since mid- 1960. A number of top officials, sharing the view held by many intellectuals and large sections of the public, question the value of a rigid commitment to the West, noting that 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 3 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 Sgtgt. lkari neutralist countries often gain more by exploiting the competing interests of both major power blocs. The military government since early this year has permitted much of the press to carry on a sustained editorial campaign calling for "gradual disen- gagement from the role of a committed nation" and for improved relations with the bloc. The line taken by the press presum- ably has reinforced the latent neutralist sentiment of the bulk of the population, especially in East Pakistan. Cm n his latest conversation with Ambassador Rountree, Ayub explained that in view of Pakistan's "extremely difficult stra- tegic position"--with enemies or potential enemies on all sides, excepting Iran--it was essential to avoid trouble with Commu- nist China. Ayub felt he could not secure a border settlement from Peiping--which would ease the threat to Pakistan's se- curity from that direction--without modifying his government's position on Chinese representation in the UN and specialized agencies. Ayub indicated that Pakistani delegations would abstain on procedural questions involving the seating of Chinese Communist representatives, and would have to vote for ac- ceptance should a substantive resolution come to a vote_ CAyub and his associates also calculate that an accommoda- tion with Peiping will increase pressure on India in connection with the Kashmir dispute, and that better relations with Moscow will put Afghanistan at a disadvantage in its dispute with Pak- istan over the Pushtoonsta,n issue ThTeR.E. 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 4 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 (-----TOTSTIDENZIAL '1/400 Bonn Raises Value of West cierman mark [Foreign exchange trading in West Germany was briefly interrupted on 4 March and then resumed at a new rate of four German marks to the dollar, compared with the old rate of 4.23. Later, Economics Minister Erhard confirmed that Bonn has revalued the mark and described himself as the "initiator and driving force behind the action." He explained the move as a necessary step to maintain the stability of the German cur- rency and price levels in West Germany, as well as to stem the specu- lative influx of dollars into the country. International financial circles have long been concerned over Bonn's chronic balance-of- payments surplus, which increased another $2 billion in 1960 for � a total gold and foreign exchange reserve of more than $7.5 bil- lion. Revaluation is intended to help correct this imbalance. Although the move benefits German consumers through lower or stable prices, German businessmen and labor leaders are critical because of the resultant reduction of Bonn's competitive price edge in world markets, which they fear may put a damper on Bonn's continuing booni:-) CWhile praising the move, some Western officials have ques- tioned whether a 5-percent revaluation is sufficient to reverse the imbalance. These officials suggest that instead of an immediate flow of dollars back to the United States, speculators might stand pat in anticipation of further changes not only in the mark but in other currencies as well. Lin a press interview, on 5 March, Erhard gave assurances that in addition to revaluing the mark, Bonn intends to go ahead with plans for a billion dollar aid program for underdeveloped coun- tries as a further means of easing the US financial burden. -carifriagrAmAL, 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 5 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 Nriof SreREZ. Hostility to Trujillo Intensifying Arrests and tortures have increased markedly in recent weeks, particularly in traditionally anti-Trujillo cities in the interior, according to information reaching the American Con- sulate from a number of independent sources. Although oppo- sition to Trujillo extends to all social and economic levels ex- cept the generally politically inert peasantry, it has long been led by middle class and professional elements who are moderate and friendly to the United States. It is these groups that have been most gravely weakened by the government's repression and by the economic difficulties of the past two years. Dissident leaders fear that unless Trujillo is soon ousted, there will be little hope of a moderate successor. The military and police organizations, which remain the key to Trujillo's survival, show no sign of disaffection. How- ever, relatives of certain key officers have been victims of Trujillo in the past year, and these and other officers may well desert him if they become convinced that his end is near. The American Consulate noted on .3 March that Trujillo, who is probably aware of the gravity of the current political and economic situations, may be planning a simulated coup. Under such a plan, the government would be turned over to a military junta composed of officers ostensibly opposed to Trujillo but actually controlled by him. After OAS sanctions against the Dominican Republic had been lifted and the government assured of a market for Dominican sugar in the US, Trujillo would be recalled. Such a strategy is consistent with Trujillo's mentality and with tactics he has used in the past. --SEGREZ 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 6 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 %we unnuurust ana uastro intmence Dominant in Latin American L Peace Congress n attack on the US position in the Canal Zone would be en- thusiastically supported by delegates to the conference, as well as by observers who are attending from most Communist coun- tries, including China. The Panamanian demand for sovereignty may be used as part of a campaign against US retention of the naval base at Guantanam6-3 ['Thelma King has a long record of involvement in subversive political activity, and her current plotting with other Panamanian politicans has contributed to the instability of the Chiari government. Reportedly subsidized by Castro, she has been successful in arousing support for him among student and other groups-3 Ehe conference seems to be the fruition of Communist ef- forts to convene a Latin American "people's congress," originally set for April 1959 when Castro's prestige was at its height. De- signed to promote anti-US and pro-Castro sentiment, its agenda includes such topics as anti-imperialism, anticolonialism, de- fense of national resources, and disarmament, as well as support of the Cuban revolution_D (A secretariat drawn from Communist-front peace groups in sev ral Latin American countries has been in Mexico since De- cember working out details of the meeting, Programs to arouse interest have been held recently among student, labor, and cul- tural groups in various countries, particularly in Mexico. Car- denas--whose widespread popularity in Mexico gives him some influence in the Lopez Mateos government�and other conference organizers have met several times recently with the Soviet am- bassador to Mexico, Bazykin, and two Venezuelan delegates called on the envoy soon after their arrival on 16 Februar CBazykin plans to leave soon on a Latin American tour prob- ably designed to explore possibilities for increasing Soviet diplo- matic and economic ties. Several countries, including Panama, have delayed issuing visas requested by him, and Colombia has actually refused to grant a visa, saying the "time is not appro- priate for such a visit:"; 6 Mar 61 CENTRAL INTELLIGENCE BULLETIN Page 7 Approved for Release: 2016/07/05 C03007378 Approved for Release: 2016/07/05 C03007378 Ntaire THE PRESIDENT The Vice President Executive Offices of the White House The Special Assistant for National Security Affairs The Scientific Adviser to the President The Director of the Budget The Director, Office of Civil and Defense Mobilization The Director, National Aeronautics and Space Administration Chairman, Board of Consultants on Foreign Intelligence Activities The Department of State The Secretary of State The Under Secretary of State The Director, International Cooperation Administration The Deputy Under Secretary of State for Political Affairs The Deputy Under Secretary of State for Administration The Counselor and Chairman of the Policy Planning Council 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 The Secretary of the Army The Secretary of the Navy The Secretary of the Air Force The Assistant Secretary of Defense (International Security Affairs) The Assistant to Secretary of Defense (Special Operations) The Chairman, The Joint Chiefs of Staff Chief of Naval Operations, United States Navy Chief of Staff, United States Air Force Chief of Staff, United States Army Commandant, United States Marine Corps U.S. Rep., Military Committee and Standing Group, NATO Supreme Allied Commander, Europe Commander in Chief, Pacific The Director, The Joint Staff The Director for Intelligence, The Joint Staff The Assistant Chief of Staff for Intelligence, Department of Army The Director of Naval Intelligence, Department of Navy The Assistant Chief of Staff, Intelligence, Department of the Air Force The Department of Justice The Attorney General The Federal Bureau of Investibation The Director The Atomic Energy Commission The Chairman The National Security Agency The Director The United States Information Agency The Director The National Indications Center The Director --CCAFIDEN-T-LAL_ Approved for Release: 2016/07/05 C03007378 9LEL00�00 SO/L0/91.0Z :aseaia JOI penaidd\of /// zzz zf.ey