WEEKLY INTELLIGENCE SUMMARY NO. 36

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-01617A005000010036-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 6
• Document Creation Date: December 27, 2016
• Document Release Date: April 24, 2013
• Sequence Number: 36
• Publication Date: November 2, 1948
• Content Type: REPORT

Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
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E~LASSIFIED
OFFICE'OF REPORTS ANDSEST~ATffiD T0: TS 5 0
TRA2dSPORTA GRO K lYi - :10 , 4 P.pr 79
~A REG. 77/1763
Date: ~~ ~~~ By: 028
2 November 1946
Weekly Intelligence Summery No. 36
RRUSEVO, near the Albanian border in southern Yugoslavin, has been
tentatively identified as n new base for the on-loading of contraband
flows to Israel. (Item No. 2, C)
Tho Greek Government, in line with assurances given the US last
April, has informed the Czechoslovak Government that the provisional
authorization for its airline to operate throu~ Athena to the Near East
will eventually be withdrawn. 1,leanwhile, the number of flights through
Athens permitted the Czechoslovak airlines has been reduced. This
action by the Greek Government will implement to soma extent the US-UR
oliey of blocking Satellite air penetration of the Near East,
(pItem No. 2, B)
The expected reorganization of British Overseas Airways Corporation
(BOAC), largest and oldest of three Government-owned airlines, is soon to
be effected. (Item No. 3, C)
Plans For retrenchment of British overseas airline operations, in-
cluding the pending reorganization of British Overseas Airways Corpora-
tion (BOAC), may initiate a modification of the present international
civil aviation policy of the UK. (Item No. 4, B)
Rehabilitation of the rail system in Bizonal' Germany has been so
rapid that its limited traffic potential is no longer a serious retarding
factor blocking the increased Gorman production required for European re-
covery, (Item No. 5, C)
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Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
The recent Soviet order requiring the Austrian Federal Railways to ,
turn over 540 locomotives and 5,575 railway oars by enrly December 1948,
has disturbing impllcatioas, Pith an air of legality, the USSR oan thus
denude the Austrian rail system of a large proportion of its serviceable
rolling stock and thereby effect serious interference w ith the Austrian
phase of the I:RP program. The Kremlin, moreover, cea usa this olaim to
exert additional ..pressure on the pro-Western Austrian Government.
(Item No. 6, A)
Soviet transport officials have informally ittdicated their willing-
ness to disauas fntersanal Danube traffic with Austrian officials. Large-
scale resumption of thie.traffie, however, is unlikely. (Item No. 7; A)
SEC~~ET
Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
 Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
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1. RRUSEYO near the Albanian border is southern Yu oslavia, has been
tentatively i ntifie as a new base for the on- oadiag of contraband
floion to Israel. This airfield, capable of handling 4-engine aircraft,
is nor being used to avoid ioing oonditiona and other hazards ei[perienaed
on the former air route from Czeohoslovakia to Palestine via A3accio.
Shipment of supplies by rail from Czechoslovakia to Krusevo, furthermore,
shortens the distanoo to be Sloven, and makes possible a substantial in-
crease in tonnage without an appreoiable increase in the number of air-
craft employed.
If the report of Yugoslav-Czechoslovak oooperatioa in forwarding
supplies to Israel is based on fact, it further indicates that Tito is
subordinating his quarrels with the Kremlin to the continued support of
Soviet foreign policy wh~r~e~it~ges not conflict directly with
Yugoslav interests.
2. Beatrictione recentl im Deed b the Greeks on Czechoslovak air
traffic will iap ement to,some extont the US-UK policy of blocking
Satellite air penetration of the strategio and politically sensitive
areas of the Eastorn ldediterranean.
STAT
Despite forewarning by tho Greek Government that it was not willing
to conclude the long-pending civil air agreement with Czeohoslovakia at
this time (see T~G Summary 7 Sept.), Genoral Stanovsky, hoed of Czecho-
slovak aivil aviation, recently arrived in Athens in an attempt to reopen
discussions. Greek authorities, however, restated their position that
until Greek air aarriera are prepared to eatablieh air services to Praguo,
Greeco hen no desire to conclude a formal bilateral agreement. (A stop at
Athens is essential for Czechoslovak Airlines (CSA) an route to the Near
East, with its present fleot of DC-3a.)
Although Czeahoslovak Airlines (CSA) continues to operate to Athens
on tho basis of a provisional authorization, Greek officials, in line
with previous assurances to.~tho'U?, have reduced the number of flights
CSA is permitted to mako through Athena. (Iri particular, CSA flights
betwoea Athens sad Haifa have been curtailed.) Graeae, ,furthermore, has
informed Czeohoslovak officials that the provisional authorfzation cover-
ing;all CSA flights beyond Athens to Istanbul, Beirut, Haifa and Cairo) ..T T
~ Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
 Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
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3. Thee sated reor eaisation of Hritiah Overseas Airwa a Co oration
(BOAC , largest and of est of three Government-owes airlines, is soon to
~fi~'ected,
In contrast to its peat policy of permitting the airline corporations
to retain ooatrol of managerial and. certain policy matters, tdie Government
is actively directing this reorganization. Centralized control of BOAC~e
operating 1lvieions in London is espeated to eliminate the waste resulting
from unnecessary rivalries between BOAC~a loosely controlled, autonomous
..regional divisions.
Because of its poor performance record, British South American Air- '
ways Corporation (BSAA), a second government-owned airline, will probably
be absorbed eventually into BOAC, Aa a move in that direction, the re-
organize may feature a closer working relationship with STAT
BSAA.
4? Plana for retrenchment of British overseas airline o eratiorie, in-
cluding a pen ng reorganization o r a Overseas i a
.tion (BOAC), may initiate s modification of the present intornationala
civil aviation policy of the UR. In order to bolster the competitive
position of the hard-pressed British air carriers, the UK may attempt
to introduce restrictive measures; auah as the arbitrary division of
air traffic with other countries,. The UR has hitherto cooperated with
,,the US fn vigorously combatting the poatwnr tendency in many countries
to seek to impose such restrictions in their bilateral air agreements,
Should the UR take this atop, it would constitute a departure from
the US-UR agreement of 1946 ("3ermizda") which oatabliehed a policy free-
ing international aivfl aviation from restriatione whiah had long
hampered its development. (All subsequent bilateral air agreements with
other countries entered into by the US sad the UR have conformed to the
principles set forth in the "Bermuda" agreement,)
A modification of British policy at this time would not only
signalize a split between the US end the UR in matters concerning inter-
national civil aviation, but wou'1d encourage those countries with less
developed air resources to seek similar protection for their airlines,
This trend might result eventually in a general world-wide divergence
from air policy objectives,advocated by the US. A liberal multilateral
aivil aviation agreement, furthermore, between the countries partioipattng
in the Intern 'ation Organization, might be indefinitely STAT
postponed,
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5. Rehabilitation of the rail system in Bizonal Germany has been so
rapid that its limited traffic potential is no longer.a aerioua retard-
ing factor blocking the inoreased German production required for
Airopean recovery. In the Ruhr, vrhere war damage to rail faoilities
was especially severe, the entire oosl production is now being moved.
A eerious?ove~all shortage of serviceable freight cars still exiate,
however, cad lea pi3ority freight shipments are not being promptly
haadled in all oases. With the aid of expeoted near-oar construction and
the inteneivo oar repair px+ogrem, rail transportation will contimie to
meet the minimum requiremente.of Weatera Germanys eoonomic revival, and
within two years sufficient rolling stock will be available to handle
6. The reoent Soviet order ro uirin the Austrian Federal Railw s to
turn over ocomo vas an , rai way cars year y Decem er 948,
has disturbing implications. With an air of legality, the USSR csa thus
denude the Austrian rail system of a large proportion of its serviceable
rolling stook end thereby effect serious iaterferenco with the Austrian
phase of the ERP program. The Kremlia, moreover, can use this claim to
exert additional pressure on the pro-19estorn Austrian Government. The
Communist paper ^Volkeatimme^ already hurling oharges of non-cooperation
Bad anti-Soviet agitation against the Austrian Government, asserts that
a display of Austrian good mill could'have created an-atmosphere in which
the Soviets might have relinquished all or part of the claim,
Tho fact that the Soviets will permit Austria to effect some of the
deliveries in damaged and unserviceable stock, plus the location of
specific dellvery points, suggests strongly that some of the stock sill
be used as scrap or as a source of parts for the rail systems of Hungary
and Eastern Germany, which aie.sufferinE from oritical shortages in such
materiel.
The Austrian Transport lSiniatry,,fearing further hardening of the
Soviet attitude,. does not favor''submitting the new problem to the Allied
Council, and is attempting through bilateral negotiations to moderate
the Soviet demands. Foroiga S7inister. Gruber, on the other hand, while
admitting in part the validity of the Soviet order, intends to elicit
the support of the Allied Council~as a matter of principle and as a
deterrent to further Soviet olaims. ~
Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
 Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6
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7. Recent informal Soviet indications to Austrian transport officials
of willingness to discuss Danube traffic resumption probably ref ]e ct a
desire to test the firmness of Western determination to refuse any
Danube arrangement c~ich is not completely reciprooel.' The USSR, at the
same time, probably wishes to clarify the Western poattion with respect
to the new Danube regime established at Belgrade. Actually, there has
been no offioial Soviet reply to proposals for limited traffic resumption
on the Danube which Austria made in September, and it is unlikely.that
any largo-acale movements of traffic will result from Soviet-Austrian
conversations, It is clear, however, that the preaettt stagnation in
Danube traffic has adversely affected recovery in the Balkea States, sad
Soviet initiative in the resumption of intersonal Danube traffic on a
limited scale mfl3r be designed to allay Satellite restlessness on that
score. ~ ~
~, Declassified in Part -Sanitized Copy Approved for Release 2013/04/24: CIA-RDP78-01617A005000010036-6