CENTRAL INTELLIGENCE BULLETIN - 1958/03/20

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03177781
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 15
• Document Creation Date: January 27, 2020
• Document Release Date: January 30, 2020
• Publication Date: March 20, 1958

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20 March 1958
Copy No. 137
CENTRAL
INTELLIGENCE
BULLETIN
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20 MARCH 1958
L THE COMMUNIST BLOC
Unidentified submarine contacts off
US east coast decline to three; two
contacts reported off west coast.
Three Soviet submarines leave Baltic,
believed headed r Egypt.
USSR - Recent Suslov speeches indicate
coolness toward Khrushchev's MTS
plans. 0
II. ASIA-AFRICA
Indonesia - Government forces appear
to hold Medan and Central Sumatran
oil centers.
New Soviet arms shipment to Syria.
Yemen - Imam orders crown prince
to Moscow to ask more military,
� economic aid.
Egypt replaces ambassador to
Washington with stAri^h ratrima
0 supporter
Taiwan - Chiang Kai-shek reshuffles
� Chinese Nationalist cabinet.
III. THE WEST
France - Socialist leadership shifts to
� somewhat softer policy on Algeria.
Colombian congressional election
results necessitate new choice of
11:41 bipartisan presidential candidate.
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CENTRAL INTELLIGENCE BULLETIN
20 March 1958
DAILY BRIEF
I. THE COMMUNIST BLOC
Unidentified submarine contacts: During the period
12-19 March, unidentified submarine contacts off the US
east coast dropped sharply from the high level that had
been _maintained since mid-February. At present only
three contacts, all evaluated as possible submarines, are
under investigation in the Atlantic. During the same peri-
od, however, two new contacts were reported off the west
coast. One of these, a visual sighting 75 miles northwest
of San Francisco, has been tentatively evaluated as a posi-
tive submarine. (Page .1)
Three Soviet submarines to Egypt: Egyptgs submarine
force would be doubled by the expected arrival of three So-
viet W-class long-range sub.marines which have left the
Baltic and are believed en route to Egypt. Recent communi-
cations have indicated that Egypt has three submarine crews
available and that two additional crews are being formed.
(Page 2)
Soviet leadership: Two recent speeches by party pre-
sidium member Suslov tend to support earlier reports of
his opposition to Ithrushchev's machine tractor station (MTS)
reorganization plan. In his election speech, Suslov, in con-
trastWith the other leaders, mentioned the MTS plan only
perfunctorily and appeared to go out of his way to avald cit-
ing Khrushchev. (Page 3)
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II. ASIA-AFRICA
Indonesia: Forces of the central government are be-
lieve�cito hold the oil centers of Central Sumatra as well
as Medan in North Sumatra. While the dissidents claim
they will receive support from Atjeh, no Atjehnese units
are known to have joined the dissident forces. In South
Sumatra, Lt. Col. Barlian is said to have reaffirmed his
neutral posture. There is no further available evidence
about the planned central government landings on the west
coast of Sumatra. Col. Kawilarang, recently military at-
tach�n Washington, is en route to Menado, North Celebes,
o lend his prestige to the dissident cause.
Syria--more bloc arms A Soviet shipment of 70,000
submachine guns, now being readied for delivery to Syria,
would supplembnt 75,000 submachine guns and 40,000 rifles
previously ordered from bloc sources. The new weapons
are probably scheduled to be used for stepped-up training
of reserve forces and quasi-military units which are to be
integrated with the Egyptian National Guard. If stocks of
older Syrian light arms become available as a result of
standardization on the new Soviet bloc weapons, they could
be used for support of the North African rebellion or of
pro-UAR elements among Syria's Arab neighbors.
(Page 4)
Yemen --more Soviet aid: The Imam of Yemen is seek-
ing further economic and military aid from the USSR.
the Imam told Crown Prince Ba r,
then in Damascus, that he should make another trip to Mos-
cow to discuss obtaining additional aid. Badr has indicated
to the Egyptians that a further Soviet loan would be used to
r tapase arms and petroleum products.
(Page 5)
Egypt-United States: Cairo has informed its ambassador
in Washington, Ahrnad Hussein, that he is to be replaced by
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the present Egyptian envoy to India, Mustafa Kamil, a
stanch supporter of the regime. Hussein, who has long
been out of sympathy with Nasir's policies toward the West,
feels that this change is symptomatic of an orientation of
�Egyptian policy away from closer relations with the United
States. The shift may in fact, however, simply be part of
wider personnel changes aimed at combining Egyptian and
Syrian diplomatic representation into a single service.
Taiwan: Chiang Kai-shek has replaced his ministers
of interior, finance, and economic affairs in the first major
reshuffle of the Chinese Nationalist cabinet since 1954. Chiang
has long been dissatisfied with the operations of his economic
agencies, and a change in the cabinet has been expected for
some time. All three ministers have been under press and
legislative criticism for alleged corruption in their depart-
ments. (Page 6)
III. THE WEST
France: The Socialist party leadership has decided on
a gradual shift in its Algerian policy from support of Lacoste's
pacification program to one of considerably more autonomy
than is now provided for in the Algerian basic statute. When
this shift become evident, the rightists, who have recently
been gaining some support from center groups for their tough
attitude toward North Africa, will either have to back down or
precipitate Gaillard's overthrow. (Page 7)
Colombia: Replacement of moderate Conservative Leon
Valencia as the agreed Liberal-Conservative choice for presi-
dent is virtually certain as a result of the congressional elec-
tions of 16 March. Returns about three-quarters complete
show that while the Liberal party polled a sizable majority of
the popular vote, control of the Conservative party has been
captured by rightist elements strongly opposed to Valencia
and his candidacy. (Page 8)
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Nor 14.1
L THE COMMUNIST BLOC
Unidentified Submarine Contacts off US Coasts Decline
Reports of unidentified submarine contacts in the west-
ern Atlantic have declined sharply from the high level that
had been maintained since mid-February. Since 12 March,
five contacts have been obtained but only three are still under
investigation as possible submarines. One of these is off
Halifax, Nova Scotia, and the others are south of Nantucket
and east of Cape May.
Two new contacts have also been reported off the US
west coast. One of these was sighted on the surface by a
US naval aircraft about 75 miles northwest of San Francisco
on 13 March. This contact was tentatively evaluated as a
positive submarine and is still under investigation. A sec-
ond contact reported off San Diego on 14 March was evalu-
ated as a possible submarine and investigation has been
discontinued.
No communications support for extended Soviet sub-
marine operations in the Atlantic has been detected. Dur-
ing March, however, Soviet Pacific Fleet communications
have apparently been supporting e
leas one submarine in that area.
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Nee
Three Soviet Submarines Probably En Route to Egypt
Three Soviet W-class long-range submarines, es-
corted by a minesweeper, turned south after entering
the North Sea from the Skagerrak on 19 March and are
probably destined for Egypt, where they could arrive
about 4 April.
The Egyptian Navy already has a short-range M-class
submarine and two W-class submarines which arrived in
Alexandria last June.
three
submarine reserve crews were available and that two
more were being formed.
Egyptian naval officers were to visit Mos-
cow in regard to submarines.
The arrival of these submarines may foreshadow the
establishment of a second submarine base in Egypt.
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Further Evidence of Suslov's Differences With Khrushchev
The US Embassy in Moscow believes that the recent
election speech of party presidium member Suslov supports
earlier reports of differences between him and Khrushchev
over the reorganization of machine tractor stations. In
early March the embassy had reliable information that
Suslov was extremely annoyed at Khrushchev for proposing
the reorganization publicly before discussing it in the party
presidium.
Suslov's recent speeches have differed in a number of
respects from those of other top leaders. In his 11 March
election speech he referred to the reorganization plan only
briefly and in a manner which gave no evidence of genuine
enthusiasm. He was alone among presidium members in
not claiming the unanimous support of the Soviet people
for the plan. In marked contrast to all other top leaders,
Suslov not only avoided every opportunity to acknowledge
Khrushchey's leading role but failed to mention him at all.
He again pointedly omitted any reference to Khrushchev
in a more recent speech to cultural workers in Saratov.
Despite these signs of continuing high-level opposi-
tion, the reorganization has already proceeded to the
point where reversal is unlikely.
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IL ASIA-AFRICA
New Syrian Arms Purchases From the Soviet Bloc
A consignment of 70,000 Soviet submachine guns,
which was being readied for delivery to Syria in early
March, will probably be used in a program for stepped
up training and re-equipment of Syrian Army reserves
and quasi-military units which are to be integrated with
the Egyptian National Guard. The new shipment would
supplement 75,000 submachine guns and 40,000 rifles
previously purchased from bloc sources, which were
used for standardization of the small arms used by the
Syrian Army, and for'issue to personnel of the quasi-
military popular resistance organizations.
The Syrian Army numbers about 55,000, backed at
present by an additional 40,000 ill-equipped reservists�
Estimates of the strength of personnel in quasi-military
units in Syria run as high as 125,000, although forces of
this size may not be integrated at once into the UAR Na-
tional Guard.
If stocks of older Syrian light arms are made availa-
ble as a result of standardization on the new Soviet bloc
weapons, they could be used for supplying the rebellion
in North Africa or distributed to pro-UAR elements among
Syria's Arab neighbors. In the past, Syria has sent arms
via Egypt to the Algerian rebels, and has furnished arms
to anti-Western nationalists in Lebanon and Jordan.
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Nur*
Yemen Seeking Further Soviet Bloc Military and
Economic Aid
Crown Prince Badr returned to Yemen on 17 March
in response to instructions from his father, the Imam of
Yemen, to prepare for another trip to Moscow to renew
Yemen's request for further military and economic aid.
Badr was accompanied by Egyptian representatives who
may attempt to modify the Imam's desire for arms, in or-
der to reduce the danger of his premature embroilment
with the British in Aden.
Among aid matters of concern to the Imam are com-
munications equipment, a "ship," "special airplanes,"
assurance of enough petroleum supplies to free Yemen from
dependence on Aden, and a cash loan of $10,000,000 to be
deposited in a Swiss bank.
The materiel may be sought under the credits granted
by the USSR and Czechoslovakia in January. At that time
the USSR is reported to have granted a $353000,000 credit
for economic development, and Czechoslovakia has under-
taken to deliver an additional $3,750,000 worth of arms.
The desire for a Soviet cash loan probably reflects the
Imam's recent inability to obtain further credit from King
Saud, Although Yemen had previously received about half
of a $10,000,000 credit promised by Saud in 1956, Yemen's
affiliation with the UAR probably resulted in Saud's refusal
of further aid in January. Yemen may have been counting
on an additional Saudi advance to finance a current deal for
purchase of 15,000 rifles in Italy. Badr has indicated to the
Egyptians that the new loan to be sought from the Soviet
Union would be used to purchase arms and POL supplies.
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%we
Chiang Kai-shek Replaces Economic Ministers and
Interior Minister
Chiang Kai-shek has dismissed Finance Minister
P. Y. Hsu, Minister of Economic Affairs Kiang Pao, and
Interior Minister Wang Te-pu. They will be succeeded
by C. K. Yen, Yang Chi-tseng, and Tien Chung-chin,
respectively. A change in the Chinese Nationalist cab-
inet has been expected since the impeachment proceed-
ings against Premier 0. K. Yui last winter. Yui received
only a verbal reprimand as a result and Chiang Ching-kuo,
the President's elder son and Nationalist security boss, has
stated that Yui's replacement is not yet being planned.
Chiang Kai-shek has long been disturbed by ineffi-
ciency and corruption in the government. particularly in
the economic agencies. Many government organs have
been under investigation since last December, and press
stories have appeared linking all three of the dismissed
ministers with corrupt activities.
The shake-up probably is an attempt by Chiang Kai-
shek to reduce criticism of his government and instill ef-
ficiency. The replacements chosen are not prominent
party leaders, and no radical changes of policy are likely.
Elimination of Finance Minister Hsu, however, and his re-
placement by C. K. Yen may indicate that some changes
will be made in the system of multiple exchange rates, which
has been much criticized by American advisers.
r
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IlL THE WEST
French Socialists Shifting Stand on Algeria
The French Socialist party leadership has decided
that its Algerian policy is to be gradually shifted from
support of Lacoste's pacification program to one of con-
siderably more autonomy than is now provided for in the
Algerian basic statute. Top leaders at the 15 March
meeting of the party's national council indicated their
agreement on the change, which features early elections
under foreign supervision. Party workers are to be re-
indoctrinated before the National Congress in June when
the new program will probably be presented. The na-
tional council meeting was highlighted by Secretary Gen-
eral Guy Mollet's first public criticism of .Lacoste, whose
subsequent offer to resign was turned down.
The Socialists are trying to avoid any publicity on
the shift, but when the change becomes evident their
rightist partners in the coalition may be forced to pre-
cipitate a crisis or to back down on their demands for
an unyielding policy in North Africa. Lacoste's tough
Algerian policy has been the bridge between the Social-
ists and Independents. Many of the latter will be reluc-
tant to compromise for fear of losing their electoral
following, and growing support in the center parties for
the tough approach may also encourage them to hold
firm.
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'Nu"
Colombians Expected to Search for New Bipartisan
Presidential Cariailate
The Colombian congressional election results of 16
March will almost certainly put an end to the joint Liberal-
Conservative presidential candidacy of moderate Conserva-
tive Leon Valencia because of opposition to him from vic-
torious rightist elements within his own party. With three
quarters of the ballots counted, the Liberal party is polling
about 58 percent. Control of the Conservative party was
captured by the right-wing followers of Laureano Gomez,
who has opposed Valencia's candidacy.
The elections were held under a constitutional amend-
ment establishing parity in government for the next 12 years
between Colombia's two traditional parties, which have been
engaged in a virtual civil war for the past ten years. The
calm and orderly fashion in which the elections were held
and the limited gains made by a prodictatorial third faction
of the Conservative party suggest that although the presi-
dential vote may have to be postponed beyond 4 May, the
parity experiment has a fair chance of success. A proba-
ble replacement for Valencia as joint presidential candi-
date is moderate Conservative Antonio Alvarez Restrepo,
former minister of finance,
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CENTRAL INTELLIGENCE BULLETIN
20 March 1958
DAILY BRIEF
I. THE COMMUNIST BLOC
Unidentified submarine contacts: During the period OK
12-19k March, unidentified submarine contacts off the US
east coast dropped sharply from the high level that had
been maintained since mid-February. At present only
three contacts, all evaluated as possIble submarines, are
under investigation in the Atlantic. During the same peri-
od, however, two new contacts were reported off the west
coast. One of these, a visual sighting 75 miles northwest
of San Francisco, has been tentatively evaluated as a posi-
tive submarine. ) (Pagel.)
Soviet leadershi : Two recent speeches by party pre-
sidium member Suslov tend to support earlier reports of
his opposition to Khrushchev's machine tractor station (MTS) tWt
reorganization plan. In his election speech, Suslov, in con-
CO traet*ith the other leaders, mentioned the MTS plan only
perfunctorily and appeared to go out of his way to =avad cit-
ing lilirushchev. (Page 3)
Syria--:more bloc arms: A Soviet shipment of 70,000
submachine guns, now being readied for delivery to Syria,
would supplement 75,000 submachine guns and 40,000 rifles
previously ordered from bloc sources. The new weapons
are probably scheduled to be used for stepped-up training
of reserve forces and quasi-military units which are to be
� integrated with the Egyptian National Guard. If stocks of
older Syrian light arms become available as a result of
standardization on the new Soviet bloc weapons, they could
be used for support of the North African rebellion or o
pro-UAR elements among Syria's Arab neighbors.
Page 4)
Yemen--more Soviet aid: The Imam of Yemen is seek-
ing further economic and military aid from the USSR. In a
message on 11 March the Imam told Crown Prince Badr,
then in Damascus, that he should make another trip to Mos-
cow to discuss obtaining additional aid. Badr has indicated
to the Egyptians that a further Soviet loan would be used to
urchase arms and petroleum products.
(Page 5)
France: The Socialist party leadership has decided on
a gra=hift in its Algerian policy from support of Lacoste's
pacification program to one of considerably more autonomy
L) than is now provided for in the Algerian basic statute. When
this shift become evident, the rightists, who have recently
been gaining some support from center groups for their tough
attitude toward North Africa, will either have to back down or
precipitate Gaillard's overthrow. (Page 7)
Colombia: Replacement of moderate Conservative Leon
Valencia as agreed Liberal-Conservative choice for presi-
dent is virtually certain as a result of the congressional elec-
tions of 16 March. Returns about three-quarters complete
show that while the Liberal party polled a sizable majority of
the popular vote, control of the Conservative party has been
captured by rightist elements strongly opposed to Valencia
and his candidacy. Page 8)
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