(UNTITLED)

Document Type: 
Collection: 
Document Number (FOIA) /ESDN (CREST): 
CIA-RDP78-01617A005800010036-5
Release Decision: 
RIFPUB
Original Classification: 
T
Document Page Count: 
4
Document Creation Date: 
December 22, 2016
Document Release Date: 
October 8, 2009
Sequence Number: 
36
Case Number: 
Publication Date: 
February 18, 1946
Content Type: 
SUMMARY
File: 
AttachmentSize
PDF icon CIA-RDP78-01617A005800010036-5.pdf293.46 KB
Body: 
-LOUIUMENTIALI EUROPE TREA has not reviewed. Processed IAW CIA TREA arrangement letter dtd 4/11/08. 1. CZECHOSLOVAKIA: Borders dosed to Americans after raid . - The Czech Government has closed its borders 'to Americans .:and is holding a US Captain and two NCO's in connection with the crossing of the, frontier by a small American force on 11 February. Czech officials charge that an underground dump was dynamited. They plan to hold the men until the materiel they 'claim has been removed (reportedly radar) is returned and a US explanation is given. The US Ambassador believes the Czech Government has evidence.the raid was authorized at a high level. value. Men.n1A,hfle Soviet penetration proceeds; the Hungarian Economic Council has decided to transfer to the USSR all bauxite shares claimed by the Soviets to have been German- owned. These shares control 35 percent of Hungary s bauxite 2. HUNGARY: Financial deterioration and Soviet o2netration--. Schoenfeld reports Iungarian inflation now mounting at a run- away pace. During the past week the American dollar increased from 800,000 to over 1,800,000 pengoes, and prices more than doubled, with currency in circulation. now over two trillion pengoes. Schoenfeld predicts imminent loss of all currency 3. HUNGARY: Air au L4k er vile s- -Legation Budapest learns that Hungary in negotiations with the USSR has insisted that UK, US and Netherlands also be permitted use of Hungarian airfields and that vessels of airy nation have access to Hungary""s .5anubiah ports. 4. SPAIN: t ~~ ..fit g _Despite complete silence on the part of the local press, Embassy Madrid reports that the tooa silotage is _" itical and that Spain must import 800.000 tons of cereals during the next six months to maintain a minimum daily diet of 1400 calories. The food scarcity, coupled with increasing prices, is contributing heavily-to general political instability, and there is little likelihood of immediate improvement in view of t Tef I ET State Dept. review completed DDA Memo, 4 Apr 77 uth: ' DDA R 7,.G. 77/1.767) te: 1978 oil Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 A Document No. (~ Q t NO CHANGE in Class. .~DECLASSIFI D `'Class. CHANGED TO: TS S a Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 T""~FIDENTIAL Spain's Inability to pay for needed imports. 5. SPAIN: US urged to delay statement of policy--Ina detailed analysis of the forces within Spain working toward a change in the Government, Embassy Madrid advises against US public support of any new regime. Because Leftist and Rightist forces are so equally matched, Ambassador Butterworth feels that no interim regime could meet US long-range objectives for orderly, democratic government. FAR EAST e. CHINA:. Newv exchanl*e and trade plans--The US Treasury rep- resentative in Chungking has transmitted the proposed new Chinese exchange. and trade regulations as drafted by Arthur Young and two officials of the Bank of China. These proposals have received approval in substance by Chiang'and' Soong and are now being studied by the Ministx'y of Finance., The drafters have recommended that China should (a) aim at effecting major financial and economic readjustments by the time sterling is restored to free convertibility, (b) establish flexible exchange and trade controls and provide adequate machinery to regulate exchange and imports, (d) seek as -rapidly as possible P. sound, stable and free currency system consonant with Bretton Wdoc a; (d) remove trad+ ~ barriers, (e) allocate five am-fired million US dollars for future currency reform and set aside an exchange fund for I~ 48 operations, and (f) apply no penalty measures to blocked assets abroad, use of which should be directed into channels of advantage to China. The p_:-oposals provide for the regulation of foreign ex- change transactions and disposal of blocked property by the Central Bank which would designate other banks as well as T.r. - *r TO, _2- CONFIpENTlgt7 Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 IMF/pENTlqLi dealers to deal in foreign exchange and foreign notes. Official exchange rates would be abolished and the public would be permitted to buy and sell foreign exchange only through the appointed banks. Individtia l foreign currency accounts would be restricted and withdrawals made only for approved purposes. Penalties for violation of regulations include fines of up to one-half the amount of the illegal trans- action and the debarring of banks or individuals from further foreign exchange transactions. With respect to foreign trade policy and temporary foreign trade regulations, the proposed regulations would permit unres- tricted. trade except for a few less essential imports subject to customs license control and a brief prohibited list of both ex- ports and imports. A temporary Import program committee -would be set up under the Supreme Economic Council. 7. KOREA: Consultants to Korean Joint ComrnissI9p--9WNCC has recommended that the US an USSR appoint non-extremist Koreans :to the Korean Joint Commission. General Hodge has reported that the group chosen in the US zone will include leaders of all major parties except the Communists. Extreme right wing leaders, he declares, must be included because their personal popularity is such that even Communists Include them in any "slate". 9. N.E.i:: Political situation can }m_d--The US Consul General in Batavia reports that Clark Kerr and van Mook appear apti- mistic and that Sjahrir has accepted the Dutch proposals as a "basis of discussion". Sjahrir, however, has privately said that the proposals contain conditions which are impossible, and that if he aggreed to them, he would be immediately repudiated by the Indonesians. Such pessimism Is possibly calculated to encourage US pressure on the Dutch. THE AMERICAS 9. ARGENTINA: Peron reported to have evidence--The US Charge in Buenos Aires has heard that Peron has documentary and re- corded evidence to substantiate certain of his charges against re~-~e~sr AMNFIDENTIA-Ll' Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5 Braden and Lang. ftP1DENT14L? i0. ARGENTINA: Deportation of is agents--Charge Buenos Aires reports that a number of Axis agents were deported on 16 February and action is being taken against others. Argentina.'s compliance is better than was anticipated. 11. BRAZIL: Blue --The Brazilian Foreign Minister has told Ambassador Berle that Brazil wishes to follow the US lead in the Argentine situation, and would like to know how it can help. Embassy Madrid reports that Brazil's Ambassador has told the Spanish Foreign Ministry that, sunce Eduardo Aunos (war-time Spanish Minister of justice) was implicated by the Blue Book, Brazil could not now receive him as the ne:wAmbas- sador from Spain. frr~~--:~~T tbNFIDENTI Approved For Release 2009/10/08: CIA-RDP78-01617AO05800010036-5