CENTRAL INTELLIGENCE BULLETIN - 1958/01/22

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03015199
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 17
• Document Creation Date: January 27, 2020
• Document Release Date: January 30, 2020
• Publication Date: January 22, 1958

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22 January 1958
Copy No. 137
CENTRAL
INTELLIGENCE
BULLETIN
DOCUMENT NO.
NO CHANGE IN CLASS.
.1 DECLASSIFIED
CLASS. CHANGED TO: TV) leo
NEXT REVIEW DATE:
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22 JANUARY 1958
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LI
New Soviet ambassador to US says
Soviet leaders eager for better
relations with US.
Opposition to Party Secretary
Ulbricht growing in East German
Communist party.
USSR suggests nuclear-free zone
for Middle East.
Egyptian-Syrian union negotiations
expected to begin soon.
Venezuela - General strike threatens
President Perez' position.
Guatemalan Congress to convene
24 January to select president.
�
OTHER ITEMS
South Vietnam - Personal guards
fire on President Diem's plane.
Egypt to train Indonesian jet pilots.
Turkish defense minister replaced
by confidant of prime minister.
Japanese irritated over US trade
policies.
USSR and Colombia may conclude
barter agreement.
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CENTRAL INTELLIGENCE BULLETIN
22 January 1958
DAILY BRIEF
I. THE COMMUNIST BLOC
Ambassador-designate to the United States Men-
shikov states he is personally convinced, as are
Khrushchev, Mikoyan, and Bulganin, of the necessity
for improvement in US-USSR relations. He has told
Ambassador Thompson that this identity of views was
apparently the reason for his appointment--a hint that
one of Menshikov% primary assignments is to arrange
high-level bilateral negotiations.
(Page 1)
Vigorous high-level opposition in the East German
Communist party has forced party boss Ulbricht to post-
pone the central committee meeting originally scheduled
for 15 January. Ulbricht% hard-line economic policies--
raising work norms and stepping up collectivization of
farmers and artisans�are being attacked as measures
which will increase unrest rather than production. Al-
though Ulbricht may be forced to make some concessions,
he will probably continue to receive Soviet support to en-
sure his dominant position.
The USSR is now suggesting a nuclear-free zone
throughout the Middle East to include specifically the
Baghdad Pact area., The 21 January TASS statement is
timed to influence any discussions on strengthening the
northern-tier concept in the Baghdad conference starting
Monday. (Page 2) (MAP)
TOP SECRET
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II. ASIA-AFRICA
Arrangements are being made for the training in
Egypt of Indonesian pilots and technicians in the use of
the jet aircraft which the Indonesians are now seeking
from the bloc (Page 3)
Frustration in Japan over US trade policy and its
application to Japanese imports has become acute as
a result of recent recommendations by the US Tariff
Commission. Ambassador MacArthur in Tokyo states
that a series of restrictive actions can cause major
damage to the US position in Japan and will aid those
forces in Japan pressing for indiscriminate trade with
Communist China and the USSR.
(Page 4)
The Egyptian and Syrian governments probably will
announce formally in the near future plans to open negotia-
tions for Syrian-Egyptian union under a federal constitu-
tion. The target date for completion of a draft constitu-
tion is said to be August 1958, prior to Syria's scheduled
parliamentary elections. Should serious negotiations be
undertaken, they would be arduous because of widely dif-
ferent economic and political conditions in the two coun-
tries. Nasir will presumably continue his efforts to re-
move Syrian Army Chief of Staff Bizri and neutralize
Defense Minister Azm.
The resignation of Turkish Defense Minister Semi
Ergin and his replacement by Etem Menderes minister
of public works and close confidant of Prime Minister Ad-
nan Menderes, on 19 January is probably a repercussion
of the alleged plans for an army-led coup d'etat which led
to the recent arrest of at least nine army officers. This
cabinet shift may foreshadow some furfhPr Ph nmrYPR in HIP
Turkish military command structure.
22 Jan 58 DAILY BRIEF
TOP SECRET
ii
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?fe_.
The continuing danger of assassination of South Viet-
namese President Ngo Dinh Diem was highlighted again on
18 January when his plane leaving Saigon airport was fired
on by four army paratroopers of his guard detail.
(Page 5)
II L THE WEST
The large plurality won in Guatemala's 19 January
election by rightist presidential candidate Ydigoras has
presented the congress and the army with a dilemma.
Congress, which is constitutionally charged with choos-
ing between the two top runners, contains a strong anti-
Ydigoras majority. If it refuses to name Ycligoras pres-
ident after it convenes on 24 January, serious public
disorders are likely. (Page 6)
*The position of Venezuelan President Perez is threat-
ened by a general strike which began in Caracas on 21 Jan-
uary. Street rioting has resulted in 33 deaths, many in-
jured, and about 1,000 arrests. A state of siege has been
declared and further violence may be expected. If the strike
continues, the military now backing Perez may decide to
oust him to check the mounting civilian opposition.
(Page 7)
Recent trade negotiations between the Soviet Union and
several Latin American countries refl t increased Latin
American interest in Soviet bloc trade. ) (Page 8)
22 Jan 58
DAILY BRIEF iii
TOP SECRET
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I. THE COMMUNIST BLOC
Menshikov Stresses Importance of Bilateral Talks
To Improve Soviet-American Relations
Soviet Ambassador-designate to the United States
Mikhail Menshikov told Ambassador Thompson on 20
January that he is personally convinced, as are Khru-
shchev? Mikoyan, and Bulganin, that it is essential to
Improve. Soviet-American relations. He expressed
the belief that this identity of views was apparently
the reason for his appointment. He stressed the im-
portance of contacts between
top leaders and of taking some
small steps toward improving
relations.
Menshikov's remarks sug-
gest that one of his major aims
will be to arrange high-level
bilateral negotiations. He sug-
gested that even if no specific
problem were taken up, con-
tacts between leaders would be
more useful than a large sum=
mit conference. Soviet offi-
cials during the past two months
have privately urged direct talks,
and Premier Bulganin's recent
letters asserted that the USSR "always welcomes" bilateral
consultations. Thompson considers that Menshikov's close
relationship with 1Vlikoyan over a period of years could give
him more influence in Moscow than his predecessor.
CONFIDENTb4t-
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or�-��ANIA-
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[OWN"
ISCIOANI
USSR
*AUDI *NADIA
1---Middle East Members
of the Baghdad Pact
CHINA
INDIA
24017
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Soviet Statement on Baghdad Pact Council Meeting
The TASS statement of 21 January on the forthcom-
ing session of the Baghdad Pact council in Ankara is
another step in Moscow's campaign to charge the United
States with the responsibility for blocking an East-West
detente. The statement is intended to forestall any moves
to establish American missile bases in the Middle East
and to underline the USSR's posture as the champion of
Arab nationalism and neutralism.
Charging that the Ankara meeting will be a "continu-
ation" of the recent NATO heads of government conference
in Paris, TASS asserted that the United States will attempt
to force Baghdad Pact members to accept American bases
for nuclear and rocket weapons. It warned that alleged
American plans to unite the Baghdad Pact and SEATO with
NATO would expose the members of these alliances to the
"flames of missiles and atomic war" should a conflict break
out in another part of the world.
TASS attempted to create the impression of a cleavage
between Turkey, Britain and the United States, on the one
hand, and Iraq, Iran and Pakistan on the other. Turkey,
along with the United States, was the main target. TASS
warned that the stationing of nuclear weapons and rocket
bases in Turkey "would be a great threat to the people of
the Middle East."
In line with Moscow's recent proposals to extend the
Rapacki Plan for a nuclear-free zone in Central Europe to
cover the Scandinavian countries, Italy and Albania, TASS
declared that the Middle East should also become a "zone
of peace free of nuclear and rocket weapons." Neutralist
elements in the Middle East probably will receive this pro-
posal with enthusiasm, while pro-Western leaders will have
difficulty in opposing it publicly. (
CONFIDENTIAL
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Nes*
II. ASIA-AFRICA
Indonesian Jet Pilots and Technicians to Be
Trained in Egypt
Arrangements are being made for the training in
Egypt of Indonesian pilots and technicians in the use of
the jet aircraft, including bombers, which the Indone-
sians are now seeking from the bloc.
Indonesian technical person-
nel can be sent immediately for training, while pilots
should arrive later. This arrangement is similar to
the one under which Syrian pilots were trained in Egypt
Agreement on this training apparently was reached
by the Indonesian arms purchasing mission which visited
Cairo in early January before going to Yugoslavia and
bloc countries in Eastern Europe.
Indonesia nopea Dim
planes could be delivered through Egypt to avoid a re-
volt of anti- Communist groups in Indonesia.
Indonesia believe that the announcement of a
bloc arms deal, however disguised, would be regarded
by Indonesian regional leaders as sufficient grounds for
severing all ties with Djakarta.
From an air capabilities standpoint, the acquisition
of Soviet-type bomber aircraft by the Indonesian Air Force
would be of no immediate significance, since it is esti-
mated that it would require a minimum of eight months for
Indonesian bomber crews to acquire a basic combat-ready
status. At present the Indonesian Air Force has no jet
bomber aircraft, 10 pilots with minimum capabilities in
jet trainer aircraft, and only 10 qualified piston bomber
pilots and 10 navigators. Also, there are only three air-
fields in Indonesia�all on the island of Java�capable of
supporting jet light bomber aircraft.
TOP SECRET
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LieLAU T .16" JILIJNILLL V.&417-6.11
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Japan Alarmed by US Trade Restrictions
Ambassador MacArthur reports that frustration in
Japan over US trade policy and its application to Jap-
anese imports has become acute as a result of recent
recommendations by the US Tariff Commission for in-
creased rates on certain Japanese commodities. He
warns that more restrictions can cause major damage
to the US position in Japan, prompt many pro-American
Japanese to re-examine critically the economic benefits
derived from continued close association with the US,
and assist those forces pressing for indiscriminate trade
with Communist China and the USSR.
Japanese producers in other industries which depend
upon the American market will regard the US decision as
an indication of the treatment Japanese products generally
will receive in the future.
Japan's trade deficit with the US was approximately
$500,000,000 in 1956 and about $900,000,000 for the first
ten months of 1957. These deficits have been offset to a
considerable extent by dollar earnings from US forces in
Japan, but these receipts are being reduced as US forces
withdraw.
CONFIDENTIAL
22 Jan 58
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`RIM? Nair
Personal Guards Fire on President Diem's
Plane
The continuing danger of assassination of South Viet-
namese President Ngo Dinh Diem was highlighted again on
18 January when his plane leaving Saigon airport was fired
on by four army paratroopers assigned to his guard detail.
There are indications that this incident,
was instigated by
non-Communist opponents of Diem. The Vietnamese Govern-
ment has clamped a tight news blackout on the affair, and
Saigon officials deny any knowledge of it.
This is the second known attempt on Diem's life in less
than a year. Last February, a cabinet member was seriously
wounded in an unsuccessful pistol attack on Diem by an alleged
religious sect fanatic.
Although these attacks were apparently carried out by
non-Communist elements, Viet Minh Communist complicity
cannot be discounted in either case. Communist cadres, as
well as the remnants of other anti-Diem political elements,
are still active in many areas of South Vietnam. These
forces constitute a threat to the President's life) especially
during his exposure in frequent inspection trips to outlying
areas. Despite the steady growth of the government's admin-
istrative effectiveness, Diem's sudden removal from leader-
ship would seriously jeopardize South Vietnam's political sta-
bility and continued progress as a strong anti-Communist
state.
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vs,
THE WEST
The Post-Election Situation in Guatemala
The 19 January elections in Guatemala have produced
a potentially explosive situation. Unofficial returns give
rightist Ydigoras a clear plurality, while centrist Cruz
Salazar appears second, and leftist Mendez Montenegro
trails.
The Congress, which meets on 24 January, is consti-
tutionally charged with choosing between the two leading
candidates when there is no majority vote. The controlling
moderates in Congress are strongly opposed to Ydigoras
and may choose Cruz Salazar instead if he is clearly in sec-
ond place. The Congress may, on the other hand, simply
dissolve, thus inviting a military coup. Some influential
army officers intensely dislike Ydigoras.
Ydigoras announced on 20 January that he expects Con-
gress to select him and implied that, if it does not, his sup-
porters will resort to mob action. Earlier, he threatened
"civil war" if robbed of victory. The Communist-infiltrated
Revolutionary party also declared on 20 January that Ydigoras
should be named by Congress.
22 Jan 58
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"Nino' �10
Venezuelan General Strike Threatens Position
Of President Perez
The position of Venezuelan President Perez is threat-
ened by a general strike which began in Caracas on 21 Jan-
uary. The chief sponsor of the strike appears to be the
Junta Patriotica which is composed of various civilian ele-
ments opposing Perez0
street rioting has resulted in 33 deaths, many injured�
an estimated 1,000 arrests, and considerable property
damage. The government has declared ,a state of siege and
called out troops to check the violence which police and
national guard have apparently been unable to control.
The protest movement has widespread support from
a large number of prominent Venezuelans, the press, stu-
dents and some worker groups. Moreover, the organizers
of the strike have apparently made contact with dissident
military groups to win their co-operation.
elements of varying size in all
armed forces components may defect if the strike appears
to be successful.
Perez has moved decisively to bolster his authority
since the revolt of 1-2 January and the cabinet shake-up
dictated to him by the armed forces on 10 January. His
control over the realigned military, however, remains un-
certain. Division within the military and the rapid changes
in top command positions and in the government have appar-
ently confused all ranks of officers, who are probably watch-
ing the trend of the power struggle before fully committing
their support.
If the strike and violence continue, the military now
backing Perez may oust him in order to conciliate the mount-
ing civilian opposition.
22 Jan 58
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e
Soviet Commercial Negotiations in Latin America
A semiofficial $30,000,000 barter agreement between
Colombia and the USSR, involving coffee from Colombia in
exchange for agricultural machinery and possibly wheat
from the USSR, appears to have reached the final stages
of negotiation. In a press interview in Bogota, the two So-
viet commercial agents negotiating the coffee contract stated
that the USSR could sell Colombia industrial and precision
machinery, chemicals, and primary materials on long-term
credit at a rate of 2 or 3 percent.
Deteriorating economic conditions in Argentina and the
depressed prices of primary products such as Colombian
coffee and Chilean copper have led to a growing interest by
these countries in the recently intensified Soviet bloc eco-
nomic offensive in Latin America. Chile is considering the
sale of 15,000 metric tons of copper wire worth $10,000,000
to the USSR. Argentina has Just sent a trade mission to the
bloc seeking electronic and petroleum industry equipment to
be purchased with the approximately $30,000,000 trade sur-
plus with the bloc. The Brazilian cabinet is considering its
policy toward recent Soviet bloc overtures for increased
trade. In Uruguay, the Soviet Embassy is attempting to pro-
mote a barter agreement involving Uruguayan meat in ex-
change for Soviet trucks and agricultural machinery.
Gavnareate,
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'Awe? *Ng
DISTRIBUTION
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 Mobilization
Operations Coordinating Board
Board of Consultants on Foreign Intelligence Activities
Special Assistant for Foreign Economic Policy
The Treasury Department
The Secretary of the Treasury
The Department of State
The Secretary of State
The Under-Secretary of State
The Counselor
The Deputy Under-Secretary for Political Affairs
The Deputy Under-Secretary for Economic Affairs
The Deputy Under-Secretary for Administration
Director of Intelligence and Research
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 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
Deputy Director for Intelligence, The Joint Staff
Assistant Chief of Staff, 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
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
404-k mennrinirmarmr AT
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CENTRAL INTELLIGENCE BULLETIN
22 January 1958
DAILY BRIEF
I. THE COMMUNIST BLOC
Ambassador-designate to the United States Men-
shikov states he is personally convinced, as are
Khrushchev, Mikoyan, and Bulganin, of the necessity
for improvement in US-USSR relations. He has told
Ambassador Thompson that this identity of views was
apparently the reason for his appointment--a hint that
one of Menshikov's primary assignments is to arrange
high-level bilateral negotiations.
(Page 1)
The USSR is now suggesting a nuclear-free zone
throughout the Middle East to include specifically the
Baghdad Pact area. The 21 January TASS statement is
timed to influence any discussions on strengthening the
northern-tier concept in the Baghdad conference starting
Monday. (Page 2) (MAP)
Arrangements are being made for the training in
Egypt of Indonesian pilots and technicians in the use of
the jet aircraft which the Indonesians are now seeking
from the bloc. (Page 3)
The Egyptian and Syrian governments probably will
announce formally in the; near future plans to open negotia-
tions for Syrian-Egyptian union under a federal constitu-
tion. The target date for completion of a draft constitu-
tion is said to be August 1958, prior to Syria's scheduled
parliamentary elections. Should serious negotiations be
undertaken, they would be arduous because of widely dif-
ferent economic and political conditions in the two coun-
tries. Nasir will presumably continue his efforts to re-
move Syrian Army Chie of Staff Bizri and neutralize
bere'nee Itnister Azni.
The large plurality won in Guatemalals 19 January
election by rightist presidential candidate Ydigoras has
presented the congress and the army with a dilemma.
Congress, which is constitutionally charged with choos-
ing between the two top runners, contains a strong anti-
Ydigoras majority. If it refuses to name Ydigoras pres-
ident after it convenes on 24 January, serious public
disorders are likely. (Page 6)
The position of Venezuelan President Perez is threat-
ened by a general strike which began in Caracas on 21 Jan-
uary. Street rioting has resulted in 33 deaths, many in-
jured, and about 1,000 arrests. A state of siege has been
declared and further violence may be expected. If the strike
continues, the military now backing Perez may decide to
oust him to check the mounting civilian opposition.
(Page 7)
Recent trade negotiations between the Soviet Union and
several Latin American countries reflect increased Latin
American inbApproved for Release: 2019/08/0 IC03015199 (Page 8)