WEEKLY SUMMARY #80

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Document Number (FOIA) /ESDN (CREST): 
CIA-RDP78-01617A002300340001-8
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RIFPUB
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S
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28
Document Creation Date: 
December 27, 2016
Document Release Date: 
February 15, 2013
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1
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Publication Date: 
December 9, 1942
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REPORT
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RETURN TO CIA LIBRARY WEEKLY SUMMARY C fl Number 80 9 .DEC 194? 00 Document No? 'NO CR.ANGE in Class. (7 ,,DECLASSIFIED Class. CHANGED 10: TS S DDA Menlo , A Apr 77 Huth: DDA gEG. 77 175? - m ~\.'~? Date: CENTRAL INTELLIGENCE AGENCY ~Irr~ival Krtnr~ G,rn !c Jirhive & A'2.C hr C ,R M diak6 4b. 1Ja ~D a 13 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 l[ti a? . 1. This publication contains current intelligence exclusively and therefore has not been coordinated with the intelli- gence organizations of the departments of State, Army, Navy, and Air Force. 2. This copy may be either retained, or destroyed by burning in accordance, with applicable security regulations. or returned to the Central Intelligence. Agency. 8' WARNING This document contains information affecting the na- tional defense of the United States within the meaning of the Espionage Act. 50 U.S.C., 31 and 32. as amended. Its transmission or the revelation of its contents in any manner to an unauthorized person is prohibited by law. Ii Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET Page HIGHLIGHTS ..................... 1 WESTERN EUROPE 2 EASTERN EUROPE ............. 6 NEAR. EAST e AFRICA ...... ..... 10 FAR EAST ARTICLES: .............12 West German Cartels ... , .... 16 Sweden's Export Policy ....... 18 Inter-American Relationships ... 20 A Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 ri Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET % o H I G H L I G H T S Developments during the week in the East-West struggle for control of Europe revolved primarily about Yugoslavia. Soviet propaganda treatment of both the recent Cominform resolution. on. Yugoslavia and the Kostov trial in Bulgaria suggests that the Kremlin. is not planning immediate concerted or overt Satellite action against Yugoslavia. The Kremlin appears more concerned at this time with the need to eradi- cate "nationalist" elements from the Satellite Communist- Parties (see page 8). Meanwhile, recent Yugoslav overtures toward achieving a bilateral settlement of the Trieste issue ~. with Italy, though indicative of Tito's growing desire to cement relations with the West, are unlikely to lead to an .early solution of this problem (see page 6), has finally moved to its last bastion on Taiwan, and announced plans for continued anti-Communist resistance on. the main. land have little chance of success (see page 12). Prospects o for increased stability in Burma have improved as a result of the Government's reported plan to negotiate a settlement with the insurgent Karens (see page 12). Q a C C ~1 SECRET Declassified and Approved For Release 2013/02/15: CIA-RDP78-01617AO02300340001-8 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 Western Labor Western labor's efforts to build a unified non-Communist world labor movement at the recent London. Trade Union Conference will remain inconclusive until the European Catholic unions respond to the AFLmCIO bid to quit the Catholic Trade Union Interna- tional within two years and enter the new international. Although the Belgian. and Italian Catholic unions have pro- visionally accepted, their final position, like that of the other 21 to 3 million workers in the Catholic unions, awaits a policy decision. by the Catholic International, The US labor bid, agreed to by the Conference over Socialist opposition, poses a difficult choice for the Catholic trade unions: whether to join the new international on US assurances that it will not be Socialist-dominated or to cling to the half-century old Catholic International, Currently, they are seeking some basis of cooperation. with the new world organization which will permit the two internationals to co=exist while ensuring close collaboration between them. Although. this solution would postpone Indefinitely the unification desired by the US labor leaders, It would probably be accepted by them. as the best obtainable. Meanwhile, Soviet recognition of the dilemma facing the Catholic unions was reflected in a re- solution of the recent Cominform meeting calling for in- tensified efforts to win the support of Catholic workers and their organizations, Political Trends The traditional German proclivity for dominance by the executive branch in the governmental processes, and to a lesser extent Chancellor e Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 I Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Adenauer's autocratic tendencies, will probably prevent full implementation of Adenauer's pledge in the 22 November Petersburg agreement with the Allied High Commission to exclude authoritarianism from German political life and to "liberalize" the governmental structure, In order to do so, the Adenauer government would be forced to make drastic changes in its present legislative program, as well as to alter the prevailing attitude of many government officials. Illustrative of this attitude are: (1) the hostil.ity*of,.federai-and state officials to unrestricted freedom of the press; and (2) the strong support for the proposed-eivil service law, which provides in effect for the reconstitution of the old entrenched German bureaucracy, Many Germans also view Adenauer's recent actions in making unilateral decisions on foreign policy, as well.as the expulsion of Social Democratic leader Schumacher from the Bundestag, as damaging the prestige of representative government in west Germany and as a step in the direction of the authoritarianism wii eli We Chancellor so recently promised to prevent. FRANCE Inflationary Trend With the inflationary trend in France expected to be reflected in prices and wages during the winter, political considerations will probably prevent the present Government from taking the necessary remedial measures. Aware of the strong op- .position from business,'farm, and labor groups to the Government's budget, scheduled for discussion on 15 December, the Cabinet will be reluctant to tighten credit or clamp down on wage raises, Moreover, the Bank of Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 France is reluctant to adopt tighter credit controls on the grounds that such action would jeopardize the Govern- ment's commitments regarding full employment and a "high level" of economic activity. Meanwhile, wages are expected to rise following a return to collective bargaining, a step which is virtually certain in view of universal labor demand anti of the Socialist obligation to push this demand possibly by threatening to withdraw from the coalition. Despite these inflationary pressures, ECA is considering--in view of the :Government's present political difficulties--release in December of the 37-billion franc balance of the counterpart fund, Bilater.i Trade The end.of the postwar shortage of goods in Western Euiope and the uncertainties as to price trends followigg devaluation have brought. fresh problems to the working of the British system of bilateral trade pacts as a means of effecting and controlling the exchange of goods. Throughout 1948, when the need for essential imports was grea.t,_government permitted the importation of non-essential products in order to obtain the more essential goods, and non-essentials were sufficiently short to assure individual importers of satisfactoty home markets. Production has now increased so that markets are becoming more competitive, in- dividual importers have been presented with additional sources of supply, and diverse price movements since devaluation have further unsettled markets. As a result, the bilateral trade pact no longer ensures the entry into Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 foreign markets of a given quota of non essential products. In current trade negotiations, therefore,the granting of licenses for "non+essential" goods and the promise of definite amounts of "essential" products are no longer decisive, and increased weight is given to the criteria of price and qualify. Although some British exporters are perturbed at the collapse of agreements upon which they had planned production and sales policies, the change adds a fresh challenge to British productivity and sales- manship, and the development signifies an important postwar step toward a more genuinely free market. New Regime The minority government formed by Iceland's Conservative Party will not be capable of sufficiently decisive action to solve Iceland's economic difficulties and legislation will result only in compromises. Moreover, the highly controversial nature of Iceland's domestic issues at this time will be a continuing threat to the minority government;4here is already speculation concerning the likelihood of new elections in the spring. In the foreign field, the new Government will be anti-Com- munist and will not oppose US interests-in Iceland. There are, however, anti-i7S elements in both the opposition Progressive and Social Democratic Parties, and these elements will tend to obstruct the implernenta. tion of a pro~US policy. Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Yugoslav Plans A recent Yugoslav request for US intercession with Italy to agree to a compromise settlement of the Trieste issue, coupled' with the presence in Rome of a Yugoslav mission auth- orized to discuss other Italo-Yugoslav differences, in- dicates Tito's growing desire to cement his relations with the West but is unlikely to lead to an early solution of the Trieste issue, Yugoslavia's eagerness to reach agreement with Italy on Trieste, which has already been manifested by past efforts to placate bitter Italian. feelings on the area and to smooth relations with the Allied Military Goverfunent in Trieste, has probably been Increased by the belief that: (1)-a -rapprochement with Italy would strengthen Tito for the expected eventual showdown with the Cominform;- and (2) an -amicable Italo- Yugoslav settlement of the Trieste question would strengthen US support for Tito, The Yugoslavs may also fear that the Kremlin, in its efforts to undermine the Tito regime, might now be Inclined to adhere to the US declaration calling for the return. of the entire Free Territory of Trieste to Italy. It would thus appear that Tito has overlooked, temporarily at least, the fact that the continued presence of Western forces In Trieste under the status quo serves as a symbolic deterrent to Soviet aggression against Yugoslavia and provides a direct channel for western military aid to Yugoslavia, Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Despite these considerations, a bilateral solution of the Trieste issue is still unlikely at this time. Yugoslavia will seek to retain most of the Yugoslav zone, which has now been virtually made a part of Yugoslavia. The Italian Government, on the other hand, is .presently unable, without strong internal. reaction, to agree to anything short of the return 'of the entire Territory to Italy, a position which the US is publicly committed to support. Thus, any formal bilateral discussion of the issue at this time would only serve to arouse the deep-rooted nationalistic feelings of both the Yugoslavs and Italians. Communist Plans The Greek Communist Party is apparently taking steps to implement its announced shift from military to economic and political activity. Following close upon recent reports of armed commissar-led squads engaged in sporadic sabotage and terrorism while spreading "enlightenment," seeking recruits, and raiding villages for food and supplies, a new directive has laid down. the lines Communist followers are to pursue in trying to transform the purely economic strike campaign recently undertaken by the anti?Communist Confederation of Greek Workers into an organized political weapon. The Communists can expect few substantial early gains from their new tactics in view of the generally anti-Communist sentiment of Greek labor, the ability of the Greek armed forces to keep guerrilla remhants off balance, and the currently good morale of the Greek peoples There are certain Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 0 GREECE weaknesses in the Greek situation, however, which will contribute to the Communist potential during the coming winter. Government ineptitude in dealing with labor's wage demands has already increased the possibility of a general strike, which would undermine the stability of both the Government and the economy: add create opportunities for Communist exploitation. Winter weather is beginning to hamper army operations and will thus aid the efforts of the commissarbled guerrilla squads. In addition, the Government's program of re- leasing former Communists and fellow travellers from confinement after a period of rehabilitation will add to the reservMr of potential, Communist recruits. Com- munist exploitation of these various factors may begin to show results by spring, possibly in time to disturb Greek election plans and will generally increase the instability on which Greek Communism thrives. Cominform Plans Propaganda treatment by Moscow of the Cominform resolution on Yugoslavia and of the Kostov trial in Bulgaria indicates that the Kremlin does not yet consider the time ripe for an all-out propaganda campaign calling for Communist aid in'a struggle to overthrow Tito and has no immediate plans for concerted Satellite action against Yugoslavia. That part of the communique which calls for "the utmost assistance" by world communism in the fight to over- throw the "fascist Belgrade clique" has been beamed only at Yugoslavia., while the Satellites and the outside Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 world have merely been exhorted to increasing vigilance against the dangers of Titoism. It would thus appear that the Kremlin does not contemplate an immediate drastic intensification of overt Satellite pressure against Yugoslavia. This does not preclude, however, an increase in subversive anti -Tito activity within Yugoslavia, which would not require an extensive propaganda buildup. Sim- ilarly, the Kostov trial is not being used as a propaganda springboard for all-out demands for aid in the overthrow of Tito, Instead, Soviet propaganda to the Satellites on the trial is also stressing the need for vigilance and for the ousting-of "nationalist" elements from the Communist parties, a Declassified and Approved For Release 2013/02/15: CIA-RDP78-01617AO02300340001-8 Soviet Policy In openly supporting the internationaliza- tion of Jerusalem, the USSR has once again demonstrated its desire to gain a voice in Near Eastern affairs and to foster dissension and unrest in the area and has highlighted the deterioration of Soviet-Israeli relations. The USSR probably supports internationalization, not _ only for the opportunity it affords for a direct Soviet voice- in the administration of Jerusalem but in the hope that the plan will prove unworkable and thus give rise to irridentist agitation and political instability. Although the USSR has abandoned its support for Israel on this Issue, basic Soviet objectives remain unchanged: namely, to reduce Anglo- American influence, promote disunity in the Near East, and foster political and economic instability. Thus, in pursuance of these alms, the USSR at first supported Israel. With the gradual strengthening of. US-Israeli ties, the USSR has re- duced Its support and is again laying emphasis on its basic anti-Zionist. policy. Similarly, Soviet support for a separate Arab state in Palestine is designed primarily to weaken UK-supported Jordan and to increase fragmentation. In the Arab world. 'Economic Distress The current deterioration of living conditions in various sections of Iran, notably Azerbaijan, can be charged largely to govern= mental inertia. Although the Government has imported 00 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET considerable quantities of wheat and initiated a number of work relief projects in. order to cope with the widespread crop failure and the increased unemployment, the effort to relieve the distressed areas has bogged down in detail because of official lassitude, corruption, and incompetence, both in Tehran and in the provinces. With some 4,000 refugees from Azerbaijan now in Tehran and others arriving at a reported rate of 400 daily, top Iranian officials are expressing considerable concern over the situation, which will become more critical as the coming of winter forces suspension of the relief constru ction program and slows up the distribution of wheat.. Until the Shah returns later this month, however, no one is likely to take the drastic action which is required. .The USSR, in the meantime, has made unexpectedly little propaganda use of its wheat shipments to Iran, and may be waiting for just such a deterioration of the situation, which would add additional force to its blasts against the Irabtan Government. Border Incidents Meanwhile,a recent resurgence of border incidents along the Soviet-Iranian frontier, after some weeks of relative quiet, has finally provoked a demarche on the part of the Iranian Government. According to Prime Minister Saed, he has proposed to the USSR that either: (1) a mixed frontier commission be set up to settle disputes; or (2) the questions involved be settled by arbitration. Saed has indicated that if the Kremlin fails to reply within a month, his offer will be repeated and that a subsequent failure to answer will cause Iran to submit its entire file of documents on the border issue to the UN Security Council. Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 r Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET Recent assertions by the Kwangsi military clique that it will continue resistance to Communist penetration. of southwest China, although probably designed to preserve a claim to any US aid which may be forthcoming after the anticipated fall of Chiang Kai-shek and his Taiwan regime, are unlikely to be implemented with any degree of success. The group, headed by Acting President Li Tsung-jen, includes the governors of Yunnan and Kwangtung Provinces and the local administrator of Hainan Island, Its military strength is largely based on the remnants of Pai Chung-thsi's troops now trying to retreat toward Hainan. However, the mili- tary vulnerability of remote Hainan, long infiltrated by local Communist guerrillas, prevents its use as a perma- nent military bastion. Moreover, Li's presence in the US considerably lessens the coalition's prospects for success, while current Communist advances in that area may well, within the near future, eliminate any chances for survival. In an effort to unite the country against ,,the growing threat of Communist China, the Burmese Government plans to seek a negotiated settle- ment with the insurgent Karen, The Governmeht is apparently prepared to offer the Karen an autonomous state, full amnesty,and an invitation to rejoin the Burmese Army. Although the Karen would probably be willing to Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 enter negotiations on. this basis, questions of boundary delineation and delegation of powers to the proposed state will pose serious obstacles to agreement. Despite continued animosity between the Burmese and Karens, however, consummation of even a limited agreement would permit greater concentration of Government efforts against Burmese Communists and would con- stitute an important step toward restoration of stability in Burma. Possible Coup Mounting opposition to Premier Phibul's regime on the part of military and civilian groups in. Thailand makes an attempt at a coup d'etat within the next three months a distinct possibility. Navy and Air Force circles, as well as Aamy careerists who wish to see the Thai. military divorced from politics apparently have banded together with civilians to make common cause against the corrupt Phibul Government. Although a successful coup could. result in a more democratic regime, it is not likely to bring increased stability to Thailand. Instead, the overthrow of Phibul, by intensifying the basic cleavages in Thailand's political structure, could be expected to make that country even more vulnerable to Chinese Communist pressures than it is at present. SECRET !! Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 ,INDOCHINA 1. Republic of Indonesia 10. Autonomous area of Bandjar 2. State of East Sumatra 11. Autonomous area of S. E. Borneo 3. Padeng, under Provisional Fed. Govt. 12. Federal district of Batavia 4. State of South Sumatra 13. State of Pasundan (West lava) 5. Federation of Bangka-Billiton-Riouw 14. Area of Middle Java under Provisional Fed. Govt 6. Autonomous area of West Borneo 15. State of East Java 7. Autonomous area of East Borneo 16, State of Madura 8. Autonomous area of Kota Waringin 17. State of East Indonesia 9. Autonomous area of Great Dayak THE tt. PHIUPPINES Foos UNITED STATES OF INDONESIA Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 J a. I $ $4 t Q = Declassified and Approved For Release 2013/02/15 CIA-RDP78-01617AO02300340001-8 SECRET Sovereignty Transfer Pending almost certain ratification of The Hague agreements by the Dutch Parliament and by representatives of the 16 states and "autonomous constitutional units" in Indonesia, the Nether- lands' Provisional Federal Government will be replaced by the United States of Indonesia (USI) on 27 December, The new state will be confronted by many pressing and complex problems during the first year of existence. Barring drastic changes in international trade patterns and a sharp reduction in US and western influence as the result of further advances of Communist control in other parts of Asia, however, prospects for the establishment of a politically stable and economically prosperous nation are reasonably good. The most immediate problems to be faced by the new regime include the silencing of rebellious dissidents of left and right, persuading the population. that the settlement with the Dutch was the best obtainable, and taking effective steps to commence economic rehabilitation. It is expected that much military and some financial aid will be granted by the Netherlands, and this assistance, together with the dynamic leadership of. Sukarno who is scheduled to be the first President, should prove to be the new nation's most valuable asset in. Its attempts to create and maintain a stable regime. Although the provisional constitution provides for a strong central government during the difficult period of transition, the new regime will face complex problems of administration. and organization in unifying the numerous political divisions (see map) which vary widely in political and economic importances Many of these areas have artifical boundaries established under the pressure of. Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 INDONESIA military action rather than by ethnic or geographic considerations. Consequently, some areas will have influence out of all proportion to their importance. These inequalities should be overcome, however, following the plebiscites scheduled for 1950 and as a result of the union of weak nearby units with the Republic of Indonesia, I,0 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET WEST GERMAN CARTELS There is increasing evidence of renewed activity in the formation of combines, trusts, and international cartels in Western Germany, particularly in the steel and chemical in- dustries. An example of the process of cartelization, and the instance in which the process has gone the farthest, is afforded by the chemical industry, where German management groups are now battling for control.of the remnants of the former I. G. Farben empire. The management of one of the largest I.,G. enterprises, the Bayer plant at Leverkusen in. the Brit- ish lone, seems to be in the most powerful position to dominate and control the Western German-chemical industry. Although occupation law provides for thel'egal dissolution of the I. G. combine, as well as for sale of the individual plants, current .reports reveal that these plants are already being drawn back into a new organization by financial pressure and voluntary agreement, encompassing so large a proportion of the chem- ical industry as to constitute a combine with monopolistic tendencies.. Within Germany, cartels are not opposed by any influ- ential segment of society, and, in fact, are welcomed by organized labor as a means of guaranteeing steady employ- ment. Although the Minister of Economics of the Federal Republic has expressed strong opposition to cartels as un- warranted concentration of economic power and a barrier to free competition, effective measures cannot be expected from the Bonn Government, despite its commitment to the western powers to take legislative action to effect decartelization and combat monopolistic practices. N Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 fl Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET a a a is Moreover, the problem of cartels is international in scope. There are indications that the chemical interests of France, the UK, and Italy, with Switzerland acting as the financial clearing house, are actively encouraging international cartel arrangements with the West German chemical industry to facilitate price control and division of the market. As long as the French, British, and Italian chemical interests engage in cartel arrangements, the German chemical industry will endeavor to cooperate rather than face the possibility of being driven from the world markets. Present trends suggest that cartels will remain an integral part of the economic structure of Western Europe, including Germany. There are as yet no signs that, in Germany at least, governmental controls will effectively minimize the economic, political, and security dangers inherent in excessive concentrations of industrial power. Declassified and Approved For Release 2013/02/15: CIA-RDP78-01617AO02300340001-8 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 SECRET Although Sweden is supplying substantial quantities of anti-friction bearings to the USSR and the Satellites under current trade agreements, in general Sweden is moving toward fuller cooperation with western. powers in their practice of denying strategic products and materials to the USSR and Satellite areas. Sweden is now preparing an executive order scheduled to go into effect during January 1950, which will provide for more effective contrbl over the export of war materials. Although the new and enlarged list of items restricted for export will contain additional items now on the US prohibited list, Sweden's export restrictions still will not parallel those thought to be necessary by the West. A new type of export restriction for Sweden may be found, however, in the possible embargo of machinery and equipment which can be used to manufacture or process materials carried on the restricted list, With the exception of certain implements of war, Sweden has heretofore refused to cooperate with the West on restricting the export of strategic materials because of the feeling that such restrict- ions would prejudice Sweden's traditional policy of_neutrality. In order to avoid the appearance of reversing this policy, Sweden will probably attribute the extension of embargoed items to security requirements arising from recent technical developments. Although an ex- tension of restrictions may be interpreted as Sweden's tacit admission of the danger of future military ag- gression by the USSR, Sweden has more immediate and more practical reasons for modifying its neutrality. Sweden is concerned. (1) over the possibility of arousing Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 f Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 Q SECRET 0 adverse public reaction in the US; and (2) lest Swedish "uncooperativeness" influence the allocation of funds O by the Organization for European Economic Cooperation. Moreover, Sweden hopes that maintaining the goodwill of the western. nations will make it possible to obtain much-needed military equipment even though Sweden is not a signatory of the North Atlantic Pact. o A cartel agreement between the Villar Perosa Company of Italy and SKF of Sweden is reported to have specified Q that the Italian company should have preference in, the West European market, SKF apparently was willing to O make this concession in an area where it formerly held dominance, largely because of Sweden's current trade agreements under iahich SKF is shipping substantial Q quantities of its anti-friction. bearing production to the USSR and Satellite nations, 0 M Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 The recent deterioration in inter-American. solidarity, while posing no immediate or serious threat to US policy in world affairs, will, if continued, weaken US influence in Latin America and contribute to further unrest and tension. This growing disunity has resulted primarily from- (1) revolutionary changes in several governments and resultant charges of foreign intervention in internal affairs; (2) the feeling prevalent in Latin. America that the US is neglecting Hemisphere economic needs; (3) continued reluctance by many countries to use formal inter-American machinery to settle international disputes; and (4) a tendency on. the part of the Latin American countries to follow a line in certain international affairs independent of that of the US, The failure of the US to make extensive loans will remain a political irritant and continue to obstruct the full realization. of US international economic policy objectives. Furthermore, most Latin American, countries want to industrialize and, in. attempting to protect their embryonic industries, have opposed the US-sponsored campaign to lower trade barriers. A decided breach in Western Hemisphere solidarity has grown out of revolutionary changes in government and charges of intervention in internal affairs, particularly in the Caribbean area. The disputes between Costa Rica and Nicaragua and between Haiti. and the.Dominican Republic illustrate the tension in the Caribbean. This tension has also resulted in ruptured or strained Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 diplomatic relations between the Dominican Republic and four of its neighbors as well as between Guatemala and Nicaragua. US recognition of governments which have come into being through force has been attacked by the "democratic" countries of Latin America on the ground that it is not in accordance with US policy of encouraging democracy in the Hemisphere. Meanwhile, ratification of inter-American treaties has been slow. Despite considerable activity by the Organization of American States (OAS) since its creation in 1948, the charter of the OAS remains unratified by the great majority of American states, including the US. The effectiveness of the Rio Treaty of 1947 has been weakened by the failure of five nations to ratify, and, in addition, the 1948 Pact of Bogota has also failed of ratification by the great majority of American states, The present status of these treaties demonstrates the weakness of the inter- American machinery in the settlement of Hemisphere disputes and emphasizes the threat to US security in the event of future disturbances. Although Latin American countries continue in general to support US foreign policy in the UN and in the cold war, they have often sponsored or supported programs not favored by the US. For example, on the important question of the Italian colonies, the Latin American bloc in the UN-- by strongly supporting the Italian position--embarrassed the US In its efforts to promote a compromise agreement. Again, in resuming normal diplomatic relations with Spain, several Latin American nations took a course independent of the US. As regards the USSR, however, only five Latin American countries have representatives in Moscow, and none of them is expected to exploit its relations with the USSR in such a way as to affect US security interests adversely, Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 Q 0 1 Th P id t Q .......... 2,64..,..... res e en Secretary of State 3,4......... Secretary of Defense C 6.......... Secretary of the Army Secretary of the Navy 7 Secretar of the Air Force 0 . ........ 8,70........ y Chairman, National Security Resources Board 9,71........ Executive Secretary, National Security Council C 10. ....... Assistant Secretary of the Navy for Air 11,69.. ..... Chief of Staff, US Army 12,13,14...... Director of Naval Operations 15,16,17...... Chief of Staff, U.S. Air Force 18.......... Director of Plans and Operations, General Staff, U.S.Arm3 19. . . . . . . . e . Deputy Chief of Staff (Operattons)U,S. Air Force O 20.......... Deputy Chief of Naval Operations (Operations) 21. ..... Director of Plans and Operations,U.S.Air Force Q 22,23,28..... . Special Assistant to Secretary of State for Research and Intelligence C 25,26,27,28,29, Director of Intelligence, General Staff,U.S.Army 30,31,32,33,34. 35,36,37,38,39, Chief of Naval Intelligence 40 41 42 43 44 0 , , , , . 45,46,47,48,49.,. Director of Intelligence, U.S. Air Force 50.......... Director of Security and Intelligence, Atomic Energy Com C 51.......... Executive Secretary, Military Liaison Committee, Atomic Energy Commission d 52,53,54,55,56.. 57.......... Chief, Acquisition & Distribution Division, OCD,Dept.State Director, Federal Bureau of Investigation 58.......:.. Secretary, Joint Chiefs of Staff 59...... . ... Chief, Policy Planning Staff, Department of State 60.......... Secretary of State (Attention: Chief, Policy Report Staff) 61.... . ..... Deputy Director, joint Intelligence Grout), joint Staff 62,63........ Secretary, joint Intelligence Group, Joint Staff 65.......... US Air Force Representative on joint Strategic 68........... Surrey Committee Administrator, Economic Cooperation Administration N Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8 Document No. 001 ~.x NO C::ANGE in Class. GJ/uECLASSIFIED Class. CHANGED TO: TS S C DDA Memo, 4 Apr 77 Auth: DDA REG. 7741763 Date: 31-1-~1b Bys. 0l3 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617A002300340001-8 U. S. GOVERNMENT PRINTING OFFICE 2691-s-1048 Declassified and Approved For Release 2013/02/15 : CIA-RDP78-01617AO02300340001-8