CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A003100020001-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 41
• Document Creation Date: December 19, 2016
• Document Release Date: March 2, 2005
• Sequence Number: 1
• Publication Date: February 16, 1961
• Content Type: SUMMARY

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CONFIDENTIAL
5; D r: T-
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 1180
OCI NO. 0267/61
16 February 1961
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
eftwclmj~NUAL
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bOCUMENTNO. . 9 xi
NO CHANGE IN CLASS. 17
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State Department review completed CLASS. CHANGED TO: TS S
NEXT REVIE'A' DATE: /4:2&
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THIS MATERIAL CONTAINS INFORMATION AFFECT-
ING THE NATIONAL DEFENSE OF THE UNITED STATES
WITHIN THE MEANING OF THE ESPIONAGE LAWS,
TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS-
SION OR REVELATION OF WHICH IN ANY MANNER TO
AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
The Current Intelligence Weekly Summary has been prepared
primarily for the internal use of the Central Intelligence
Agency. It does not represent a complete coverage of all
current situations. Comments and conclusions represent the
immediate appraisal of the Office of Current Intelligence.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
T H E W E E K I N B R I E F
OF IMMEDIATE INTEREST
LAOS . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 1
Laotian officials appear receptive to the US pro-
posal for a neutral nations commission--made up of Burma,
Cambodia, and Malaya. General Phoumi has announced his
readiness to visit Phnom Penh in what is likely to be a
fruitless effort to persuade Souvanna Phouma to return
to Vientiane. There has been little change over the
week in the military situation. In recent private talks
with Western officials, Soviet Foreign Ministry representa-
tives have indicated that Moscow's reply to the British
proposal of 21 January regarding reactivation of the
International Control Commission (ICC) will probably
point out that any such commission must be preceded by
an international conference to restore peace in Laos.
Peiping has taken this position publicly. The bloc
airlift into Laos continued throughout the week.
25X1
CUBA AND CENTRAL AMERICA . . . . . . . . . . . . . . . . . Page 4
Soviet technicians are en route to Havana to design
the first two industrial projects to be built under the
Soviet credit to Cuba, and steps are being taken to
implement other bloc agreements. Castro's assertion
in a 12 February speech that Cuba has the "right to en-
courage revolution in Latin America" probably reflects
his intention to increase propaganda and clandestine
activities in the area. Nicaragua and Honduras are
still in disagreement over how to proceed in implement-
ing the recent arbitral award of a long-disputed area
to Honduras, and public feeling on the issue is high
in both countries. The interim civil-military govern-
ment in El Salvador is slowly gaining popular accept-
ance at home, and six Latin American countries have
now recognized it. I I 25X1
Page 8
The uncompromising position set forth in the Soviet
statement of 14 February seems to preclude any intention
to negotiate a settlement of the Congo problem and sug-
gests that Moscow hopes Lumumba's death will lead to
the collapse of the present UN operation through the with-
drawal of the remaining Afro-Asian contingents. The omis-
sion from the statement. of a specific reference to the
United States apparently is intended as a gesture of
restraint. In the Congo, there have been only isolated
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
PART I (continued)
incidents of African actions to avenge Lumumba's death.
NOTES AND COMMENTS
25X1
AFTERMATH OF KHRUSHCHEV'S AGRICULTURAL TOUR . . . . . . . Page 1
Khrushchev has returned to Moscow from an 18-day
tour of key agricultural areas, where he advanced detailed
proposals for increasing Soviet agricultural production
and made it clear that local leaders will be held directly
responsible for carrying them out. Several personnel
changes have already taken place; more changes will prob-
ably occur as subordinates are made scapegoats for the
failures of their chiefs. 25X1
ALBANIAN PARTY CONGRESS . . . . . . . . . . . . . . . . . Page 2
Albanian party leader Hoxha's opening address to the
fourth party congress on 13 February stressed views at
variance with those of the USSR. He claimed that the
United States is preparing to unleash another world war,
and blamed the United States, Greece, and Yugoslavia for
a recent coup attempt which, in fact, probably was planned
by pro-Soviet elements in the Albanian party. He
also called for Chinese Communist participation in future
summit talks, a proposal not mentioned by the USSR since
last May. Hoxha may be planning an anti-Western show
trial of those involved in the coup attempt--a move that
Moscow would not'welcome at this time. 25X1
HUNGARY AFTER THE THREE-YEAR PLAN . . . . . . . . . . . . Page 3
Hungary has achieved or surpassed most of the goals
of its Three-Year Plan (1958-60) and has overcome most of
the effects on the distribution of the national income
following the 1956 revolt, when investment needs were sac-
rificed to make more consumer goods available. Neverthe-
less, the continuing unfavorable balance of trade leaves
Hungary in a difficult position this year, when payments
on the bulk of foreign debts incurred after the revolt
begin to fall due. Moreover, the rapid pace of agricul-
tural socialization has created new problems for-the economy.
25X1
EAST GERMANY TRIES TO REDUCE VULNERABILITY TO WESTERN
SANCTIONS . . . . . . . . . . . . . . . . . . . . . . . . Page 4
Although a new interzonal trade agreement was signed
in December, East Germany still is attempting to decrease
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
PART II (continued)
its dependence on imports from the West while maintain-
ing the total volume of trade at past levels. It will
try to increase production of items now imported from
the West, to develop substitutes, and to acquire within
the bloc commodities that cannot be produced in East
Germany. A complete reorientation of trade is unlikely
without considerable assistance from the USSR, which
so far has shown no willingness to provide such aid.
25X1
RECENT EAST GERMAN TACTICS ON BERLIN . . . . . . . . . . . Page 6
The East Germans appear to be testing the extent to
which they can avoid implementing the concessions they
offered in December without impelling the West Germans
to take countermeasures. The East Germans had promised
to relax controls on West Germans traveling to East Ber-
lin and to make technical concessions to facilitate com-
mercial traffic between West Berlin and West Germany; this
induced Bonn to reactivate the interzonal trade agreement
on 29 December. While recent East German steps appear
to be a tactical retreat, in response to an ultimatum
by the West Germans, the Communist regime has not with-
drawn its claim to the right to control the movement
of West Germans into East Berlin--i.e., to sovereignty
over East Berlin. Although Moscow presumably permits
these East German probing actions, it has not openly
involved itself and apparently does not wish to create
a crisis over Berlin at this time.
BURMESE ARMY SHAKE-UP . . . . . . . . . . . . . . . . . . . Page 9
The ouster by General Ne Win of 11 senior officers
from their commands in Burma threatens at least temporarily
to weaken the army's ability to maintain internal order
and stability. These officers, removed because of
their opposition to U Nu's government and its policies,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
PART II (continued)
include several of the army's most experienced field
commanders and capable administrators. Moreover, they
were favorably disposed toward the West, and their
removal may decrease Burma's receptivity to US mate-
el and training assistance. Dissatisfaction with
the policies of the government and the army command 25X1
persists within the army.
LONDON SEEKING TO CONFEDERATE SINGAPORE AND BORNEO
WITH MALAYA . . . . . . . . . . . . . . . . . . . ... Page 10
London is promoting a confederation of Malaya, Singa-
pore, and three British territories in Borneo--Sarawak,
Brunei, and North Borneo. Malaya is opposing the inclu-
sion of Singapore because of its overwhelming Chinese
majority and leftist orientation. The British may hope
to win over Malaya by arguing that the presence of the 25X1
Borneo territories in the confederation would partially
offset the harmful influence of Singapore.
RHODE S IA -NYASALAND . . . . . . . . . . . . . . . . .
Page 13
The Federation of Rhodesia and Nyasaland may break up.
over the issue of African representation in the government
of Northern Rhodesia. African nationalists have threatened
to institute widespread disorders if Britain does not allow
them majority representation in the local legislature,
while white leaders in Southern Rhodesia talk of secesssion
if Britain gives in. Southern Rhodesian officials recently
conceded that African political influence in their ter-
ritory should be increased, but in return obtained from
'
s white-
Britain broadened powers for Southern Rhodesia
settler government.
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UNREST IN ANGOLA . . . . . . . . . . . . . . . . . . . . . Page 14
The outlook in the Portuguese possession of Angola,
scene of several outbreaks in the last two weeks, appears
to be for increasing violence as anti-Portuguese and anti-
white extremists, some of them Communist influenced, ac-
nuire greater influence over the Angolan native popula-
25X1
FRANCE-ALGERIA . . . . . . . . . . . . . . . . . . . . . . Page 15
25X1
Gaulle hopes that his pending meeting with Tunis an
President Bourguiba will help make the PAG easier to
deal with. The rebels demand a face-to-face meeting
with De Gaulle, and Bourguiba is likely to move cau-
tiously so as not to jeopardize his moderating influence
on them.
PROSPECTS FOR ICELAND .
Iceland's Conservative - Social Democratic coalition
government has made progress during the past year in its
program to overcome inflation and reduce the country's
trade dependence on the Soviet bloc. The success of the
program, however, is threatened by the Communist-
dominated central trade union federation, which is
seeking to foment labor unrest and bring about the
government's downfall. In the protracted fishing
limits dis ute with Britain, negotiations remain
stalled.
. Page 16
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PART III
PATTERNS AND PERSPECTIVES
CHINESE COMMUNIST ACTIVITIES IN LATIN AMERICA . . . . . . Page 1
Recognition by Cuba last year gave Communist China
its first diplomatic ties with a country in the western
hemisphere. Sharing Moscow's belief that the Cuban
example offers an opportunity for further gains in Latin
America, Peiping is willing to accept the cost of siz-
able economic assistance to Havana. China's strategy for
the area as a whole is to expand trade, step up ex-
changes of cultural and other nonofficial delegations,
and increase its influence in local Communist parties.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
PART III (continued)
Peiping's expanding role in Latin America, however, has
undoubtedly prompted second thoughts in Moscow, already
in disagreement with the Chinese over correct tactics
to be used in underdeveloped areas.
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King Savang is in Vientiane
discussing with other Laotian
leaders ways of broadening the
Boun Oum government's popular
appeal and to gain greater in-
ternational support. The re-
sults of these consultations
will probably be ratified at a
special cabinet meeting expected
to be held shortly and to be
presided over by the King.
principal weakness, however, has
been the preponderance of members
from southern Laos. Wider repre-
sentation would improve its com-
petitive position with the Com-
munist-supported shadow govern-
ment in Xieng Khouang, which
claims, apparently with Souvanna 's
approval, to be acting in his be-
half as the "lawful government."
Among the moves reportedly
under consideration are a reaf-
firmation of Laos' neutrality
and an announcement of readiness
to negotiate with "enemies and
rivals--even Souvanna Phouma."
The government is apparently
prepared to offer Souvanna an
important position, possibly as
foreign minister or as head of
the King's Council. According
to present plans, General Phoumi
himself will go to Phnom Penh to
convey the offer to Souvanna.
Chances are probably less
than even that 3ouvanna will
join the Boun Oum government.
Aside from his personal animos-
ity toward Phounii, he apparent-
ly remains persuaded that pros-
pects are good for his fairly
early return to Laos on his own
terms as head of a coalition
government of "national reconcil-
iation."
The consultations in Vien-
tiane may result, however, in
at least some broadening of the
government. The Boun Oum govern-
ment is generally undistinguished,
and a few of its members have
reputations for corruption. Its
Laotian officials appear
receptive to the U.3 proposal for
the establishment of a neutral-
nations commission made up of
Burma, Cambodia, and Malaya.
Little significant change
in the military situation was
reported during the past week.
Government forces have moved
only a few miles from the junc-
tion of Routes 7 and 13 toward
the Plaine des Jarres. The Kong
Le - Pathet Lao forces are pur-
suing systematic tactics of de-
lay which have all but stalled
the government advance. Aerial
observation near the head of the
government column has disclosed
three large craters on Route 7.
The enemy has also felled large
trees, engineered landslides in
steep defiles, and made exten-
sive use of land mines. Most of
the casualties evacuated to Vien-
tiane were wounded by mortar and
artillery fragments and, more
recently, by land mines.
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the Kong Le - Pathet 25X1
Lao forces have introduced light
armored vehicles in the Plaines
des Jarres area. Five small
tracked vehicles similar to the
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Bren gun carrier allegedly ar-
rived in the Plaines des Jarres
on 11 February, and three light
armored personnel carriers were
also noted then. Aerial recon-
naissance also reported the
movement of light armored vehi-
cles in the Plaines des Jarres,
where the terrain favors the use
of armor.
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Aerial reconnaissance dur-
ing the past week has also re-
vealed that the pro-Communist
forces have prepared defense
positions on both the western
and southern approaches to the
Plaines des Jarres. Newly con-
structed gun emplacements have
also appeared, supplementing
field fortifications constructed
by the French in the Plaines
des Jarres during the Indochina
war.
Little action has been re-
ported in the Ban Ta Viang -
Tha Thom area of southern Xieng
Khouang Province; however, there
are indications that the anti-
government forces may be rein-
forcing their blocking position
at Ban Ta Viang. Sporadic harass-
ment behind enemy lines in
Xieng Khouang by progovernment
Meo partisans continues to be
reported.
will be organized into an
army attalion stationed at the
village of Namtha; the remainder
will be grouped into "village
defense" units under army con-
trol. They will be used in nrop-
ping-up operations west of
Muong Sai to support government
forces in that town and to cut
off Pathet Lao reinforcements
from Phong Saly Province who
might try to get south of that
blocking position.
Soviet Deputy Foreign Min-
ister Sobolev informed the
French ambassador in Moscow on
6 February that the USSR's re-
ply to the British proposal of
21 January regarding reactivation
of the International Control Com-
mission (ICC) would point out
that any such commission now
would have to have both a polit-
ical and military role; its tasks
therefore could only be defined
by a new international confer-
ence. He said this was also the
position of China, North Vietnam,
and Cambodia.
Since the US administration
took office, Moscow has not of-
ficially commented in its propa-
ganda on recent proposals to
reach an international solution
in Laos. The line the bloc will
probably take is reflected in
Chinese pronouncements. Chou En-
lai, in a letter sent to Cambo-
dia's Prince Sihanouk on.11 Feb-
ruary and broadcast by Peiping
on 15 February, said China is
against reactivating the ICC
under "present conditions in
Laos." Before the ICC could
return, Chou said, an interna-
tional conference must re-define
its duties.
During the past week, other
bloc spokesmen have maintained
their opposition to a reactivation
of the ICC without first con-
vening an international meet-
ing. Polish officials in
Warsaw and Moscow, in several
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CURRENT INTELLIGENCE WEEKLY SUMMARY
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conversations with Western
ambassadors, have clearly
stated this position, and
a hi hranking ioviet di -
lomat
would not agree to the Brit-
ish proposal.
Soviet spokesmen in Moscow
seem anxious to appear respon-
sive to recent US statements
that developments in Laos have
a direct bearing on Soviet-
American relations. Two senior
Soviet journalists told a US
Embassy official in Moscow that
the USSR did not want an inter-
national crisis at this time
over Laos. They said that as
far as Moscow is concerned the
Laotian crisis could easily be
solved by compromise, but added
that Peiping had quite a dif-
ferent attitude which -would make
a general agreement diffi-
cult.
In view of the bloc's ap-
parent intention to prolong
diplomatic exchanges as long as
possible, it is likely that
Soviet leaders find it conven-
ient to attribute this inac-
tion to Chinese intransigence
in talks with non-Communist dip-
lomats. In the past Soviet
spokesmen have alluded to Sino-
Soviet differences over Laos in
discussions with Western repre-
sentatives, apparently hoping to
exert pressure on the US ;to
limit its military commitment
in Laos.
Bloc airlift operations
between North Vietnam and Laos
continued at normal levels
throgghout the week. Some of
the Soviet LI-2s continue shut-
tle flights between Hanoi and
Haiphong.;. Supplies are appar-
ently arriving by sea at Hai
phong.
er. North Vietnamese authori-
ties provided a list of ship
arrivals and cargoes which in-
dicated that some ships ar-
rived empty and none contained
military cargo, but the Indian
ICC team chairman stated that
the sound of trucks leaving
the docks during this period
had kept him awake every night.
F__ I
A group of six Soviet
technicians left Moscow for
Havana on 9 February to begin
design work on the first two
industrial projects the USSR
will build under the $100,000,-
000 credit extended to Cuba a
year ago. One of the plants
will repair various types of
machinery and equipment and
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CURRENT INTELLIGENCE WEEKLY SUivIMARY
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produce spare parts for Cuba's
deteriorating industrial estab-
lishment. No date was announced
for the start of construction.
On the same day a group of 88
Cuban students sailed from Cuba
aboard a Soviet ship for five
years of technical studies in
the USSR.
Communist China, despite
its own economic difficulties,
is making a substantial effort
to fulfill its commitments to
Cuba. More than 30 Chinese-
chartered merchant vessels are
currently engaged in the Cuban
trade. Most of these are being
used to deliver the million
tons of Cuban sugar Peiping
promised to buy this year, but
some are carrying Burmese rice
and other commodities to
Cuba.
Fidel Castro's 12 February
speech to members of Cuban tech-
nical advisory councils--state--
created workers' committees re-
sponsible for setting production
norms in nationalized enter-
prises--included vitriolic at-
tacks on alleged United States
aid to anti-Castro forces.
Castro asserted, "As of today
Cuba is going to declare that
if the United States has the
right to promote counterrevolu-
tion in Cuba and Latin America,
Cuba has the right to encour-
age revolution in Latin Amer-
ica."
Castro's statement probably
means continuance of Cuba's
covert assistance to leftist and
Communist dissident groups in
other countries, and also a s-.ib-
stantial increase in the amount
and variety of its propaganda
efforts throughout the hemisphere.
The construction of a powerful
radio transmitter in Havana
Province--which Castro cited as
a source of "worry" to the United
States during his speech--should
materially enhance the Cuban
propaganda potential in this
field.
Overt attempts to overthrow
other regimes would probably be
discouraged by the failure in
1959 of several Cuban-based in-
vasion attempts against Panama,
the Dominican Republic, and Haiti
and probably by a desire to avoid
providing an excuse for open
retaliation against Cuba by
the Organization of American
States.
Castro devoted a consider-
able portion of his speech to
extolling the economic accomplish-
ments of his government, and he
contrasted the "success" of the
Cuban economic system with the
"failures" and "problems" of the
US economy. He also said that
the "most difficult" economic
task remains to be met--that of
industrialization. He related
that government plans to tackle
this problem include the designa-
tion of 1962 as the "year of in-
dustrial planning and develop-
ment," and the announcement of
a four-year industrialization
plan early next year. The em-
phasis which Castro gave to this
subject may indicate an effort
to pave the way for the eventual
assumption of a new Ministry of
Industry portfolio by economic
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tsar Che Guevara, who spoke at
the same meeting.
Despite Castro's assertion
that Cuba has no economic prob-
lems, a 7 February editorial
by virulently outspoken Radio
Mambi in Havana described "dis-
content and a certain malaise
in various segments of the pop-
ulation" due to material short-
ages and spare parts problems.
Among the economic irritants de-
scribed in the editorial were
the lack of parts for repairing
automobiles, appliances, and
machinery, and the growth of a
black market in such consumer
goods as salt, soap, razor blades,
pencils, toilet paper, and other
articles.
(roadblocks have been
erected by the government on
all roads leading into the city
of Guantanamo.
25X1
A blackout has been imposed
on news of the progress of the
campaign again anti-Castro forces
active in the Sierra Escambray
area in central Cuba. Govern-
ment spokesmen have maintained
that the regime will not issue
a communique until "mopping-up
operations" are completed and
total victory is assured. Re-
ports of heavy fighting and
rumors of victories by each side
are continuing to circulate
throughout Cuba, and several re-
ports.indicate.a,growing number
of casualties among-both gov-
ernment and. counterrevolutionary
forces.
Unconfirmed reports that
a large anti-Castro force has
landed in northeastern Oriente
Province are circulating in the
area
25X(
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A group of leading Arab
Communists, who were among the
1,000 visitors participating in
the commemoration Of the second
anniversary of the Cuban revolu-
tion last month, reported that
Cuban Communist leaders described
the alliance between the Castro
regime and the Communists' Pop-
ular Socialist party (PSP) as
"exceedingly close." The Cubans
also told the Arabs that the PSP
is, with Castro's consent, in
majority control of all the "or-
ganizations which direct the
masses," and they maintained
that the Cuban revolution will
play the same role in Latin
America as the Russian and Com-
munist Chinese revolutions did
in Europe and Asia.
Nicaragua-Honduras
Nicaragua and Honduras
still are in disagreement over
implementation of the November
1960 arbitral award of a long
disputed territory to Honduras.
Honduran President Villeda Mor-
ales is under strong domestic
pressure to move his forces
quickly into the area--part of
which has been occupied by Nic-
araguan troops for more than
50 years. Nicaraguan President
Somoza, while stating his gov-
ernment's intention to abide by
the award, is insisting that it
be implemented in an orderly
fashion, that the rights of the
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CURRENT INTELLIGENCE WEEKLY SUMMARY
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few thousand persons in the area
be protected, and that those
desiring Nicaraguan citizenship
be resettled in Nicaragua.
Somoza also insists that certain
portions of the border, not
clearly delineated in the origi-
nal 1906 award upheld by the
International Court last Novem-
ber, be definitively settled be-
fore implementation.
On 9 February, the Nicara-
guan Government received a Hon-
duran note declaring, in effect,
that the only way the award can
be implemented is for Nicara-
guan authorities to withdraw
from the area immediately. The
Nicaraguan foreign minister in-
terpreted this as an indirect
termination by Honduras of dis-
cussions on the issue. The for-
eign minister has said, however,
that if Honduras should succumb
to political pressures and move
troops into the area, Nicaragua
would expel them. On 15 February,
Nicaragua announced that it
would request the Inter-American
Peace Committee of the OAS to
settle the issue.
Popular emotions on the is-
sue are high in both countries
and restrained only temporarily
in Nicaragua by restrictions on
some civil liberties. Opposi-
tion groups are exploiting the
issue, and neither President
can ignore popular sentiment
without endangering the stabil-
ity of his regime. The situa-
tion is further aggravated by
the long-standing antagonisms
between the two countries and
by the numerous and continuing
forays into Nicaragua by Nicara-
guan guerrilla bands from Hon-
duras, some of which have been
assisted by Honduran officials.
The new civil-military di-
rectorate seems to be gaining
acceptance from the Salvadoran
public--including the non-Com-
munist students who had gen-
erally opposed the new regime.
The oligarchy of wealthy land-
owners and businessmen appears
to be adjusting its extremely
conservative outlook in response
to a direct government request
to support the social and eco-
nomic reforms necessary to avert
an eventual triumph of Commu-
nism. The armed forces have is-
sued a declaration of support
signed by virtually all officers.
The local Communist party
is reported to have issued se-
cret instructions to concentrate
on infiltrating the army, im-
proving discipline in clandes-
tine activities, and organizing
the "revolutionary front," and
to avoid the use of violence
until directives and material
aid are received from "abroad."
11 1 25X1
a Communist-led 25X1
general strike would not succeed
while the key Communist labor
officials remain in exile.
The main threat to stabil-
ity for the next several months
appears to be the possibility
that the army-dominated direc-
torate may continue to exercise
control without holding elections
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16 February 1961
and may fail to carry out its
promises of needed social and
agrarian reforms.
Honduras, Argentina, Mex-
ico, and Chile have recognized
the new regime, bringing to six
the number of Latin American
countries which have done so.
Venezuela, which had not rec-
ognized the previous junta, has
indicated that it will wait
until elections are held before
deciding.
Moscow's massive campaign
protesting Lumumba's death re-
flects the Soviet leaders' con-
fidence that this has provided
an unprecedented opportunity to
exploit their militant anti-
colonialist line and underscores
the USSR's support for extrem-
ist, anti-Western forces through-
out Asia and Africa. The Soviet
Government's statement of 14
February confidently predicted
that Lumumba's death "will a-
waken to life fresh forces of
the national liberation move-
ment in the Congo and in all
Africa." The USSR's intention
to exploit Lumumba's death to
the maximum provides further
evidence that Khrushchev is not
prepared to forego taking ad-
vantage of such opportunities
to advance Soviet influence and
prestige in the Afro-Asian world
in order to avoid offending the
Western powers.
However, the Soviet Govern-
ment's statement did not mention
the United States by name and
instead placed responsibility
for Lumumba's death on the
"colonialists, and above all
Belgian colonialists,"
Soviet propaganda has not
directly implicated the US in its
condemnation of "colonialists."
This has been the pattern of
Soviet coverage of the Congo
since the US administration took
office. The omission of spe-
cific references to the US ap-
parently is intended as a ges-
ture of restraint toward Wash-
ington. Expressions of shock
and regret by President Kennedy
and Ambassador Stevenson were
reported factually without
comment by TASS.
Khrushchev's cordial mes-
sage of 15 February in reply to
President Kennedy's congratula-
tions on the launching of the
Soviet Venus rocket probably
was intended as a sign that the
USSR hopes to prevent reaction
to events In tr' Porgo from ob-
.i-ructing :an improvement in
US-Soviet relations. 'Khrushchev
welcomed the President's offer
of cooperation in the explora-
tion of space and other tasks,
and stressed that a disarmament
agreement would create favorable
conditions for solving these
"noble tasks."
In contrast to Soviet re-
straint, Peiping's statement
on 14 February specifically
condemned the United States
along with Belgium for this
"vile and cruel attack" against
the "cause of national inde-
pendence of the Congolese and
all African peoples."
The extreme demands made
in the Soviet statement seem de-
signed to block any Western-
backed UN action to deal with
the Congo crisis. It demanded:
(1) Condemnation of the
"actions of Belgium" as an "in-
ternational crime." It called
for "appropriate sanctions"
against the "aggressor."
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16 February 1961
(2) Arrest and trial of
Tshomb6 and Mobutu, disarmament
of their forces, and removal of
all Belgian troops and personnel
from the Congo.
(3) Termination of the UN
operation in one month and the
withdrawal. of "all foreign
troops" from the Congo.
(4) The dismissal of Ham-
marskjold. Moscow served
served notice that it will not
maintain any relations with him
and will not recognize him as
an "official of the UN."
(5) Assistance to the
"legitimate government of the
Congo led by acting Prime Min-
ister Antoine Gizenga." The
USSR declared that it is ready
to "render all possible assist-
ance and support to the Congo-
lese people and its legitimate
government."
This uncompromising position
seems to preclude any Soviet in-
tention to negotiate a settle-
ment of the Congo crisis. The
Soviet leaders apparently hope
Lumumba's death will lead to
the collapse of the present
UN operation through the with-
drawal of the remaining Afro-
Asian contingents--most immedi-
ately those of Morocco, Ghana,
and Indonesia. Moscow would
vigorously exploit any move to
introduce Western troops into
the Congo as an attempt to
reimpose colonial rule. The
Soviet leaders, moreover, would
probably believe that direct
Western intervention would make
it extremely difficult or im-
possible for the West to marshal
moderate Afro-Asian governments
in support of a new approach
for a Congo settlement.
In addition to the attempt
to discredit and terminate the
UN operation, Moscow is seizing
upon Lumumba's death as a pre-
text for reviving charges against
Hammarskjold--now described as
a "miserable lackey of the colo-
nialists." Moscow's violent at-
tack on the secretary general
reflects the frustration the
Soviet leaders have felt since
Lumumba was overthrown and bloc
missions were expelled from the
Congo last September. The Soviets
selected Hammarskjold as the
scapegoat for these setbacks.
Moscow's demand for his
dismissal does not appear to
foreshadow any more drastic ac-
tion such as a Soviet-led bloc
withdrawal from the UN. This
latest statement only makes more
explicit the position Khrushchev
took last fall before the Gen-
eral Assembly when he warned that
Hammarskjold's failure to resign
would lead the USSR to draw the
"necessary conclusions" and
threatened to withhold Soviet
cooperation with any of his
decisions.
Hammarskjold is unlikely to
resign as long as he believes he
has the support of a majority
of UN members, particularly the
smaller powers. Withdrawal of
recognition of Hammarskjold as
the secretary general by the
USSR will make UN operations
more difficult but not impos-
sible. The USSR will have to
conduct usual business with the
UN Secretariat, the staff of
which is predominantly loyal to
Hammarskjold. The USSR vetoed
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16 February 1961
the reappointment of his prede-
cessor, Trygve Lie, in Cetober
1950, linking him to the UN ac-
tion in Korea. The General As-
sembly later that year e-_-..tended
Lie's appointment for three years.
The Soviet bloc responded by of-
ficially ignoring Lie as secre-
tary general for the ensuing
two years. This pressure final-
ly forced him to resign in 1)5'.
According to a high offi-
cial in the UN Secretariat,
Hammarskjold has already ordered
the UN force to occupy airfields
and other communication centers
and to set up military control
points in areas of Congolese
military action. The UN Command
reportedly has been ordered to
stop all forces engaged in of-
fensive action but to use force
only if force is used against
it. Execution of these orders
will primarily affect Mobutu's
operations in Equateur Province
and Tshombd's offensive in
northern !?'atanga. The UN com-
mand is now attempting to
establish a 50-mile-wide neu-
tral zone on the border of
Equateur and Orientale Provinces.
however, the small size of the
UN units, coupled with the equiv-
ocal nature of the directives
themselves, will render effec-
tive UN control difficult.
Hammarskjold's order to
UN forces reflects a heightened
sense of urgency as a result of
1umumba's death, Neutralist
nations reportedly believe that
the Security Council should pass
an emergency resolution urging
that all possible measures be
taken to avoid civil war and
calling for the cessation of Belgian
and other foreign interference.
Lumumba's death has aroused
a general world-wide reactioii
against Katanga and through as-
sociation, Belgium and the Kasa-
vubu government. Belgian in-
stallations-in several capitals,
including Moscow, Belgrade,
Warsaw, Cairo, Khartoum, and
Dakar were attacked by mobs. GL
.5 February, East Germany, Yu-
goslavia, Guinea, and Ghana
recognized Gizenga, and other
bloc and some neutralist states
will probably follow suit. The
controlled UAR press has re-
ported to Nasir "will fully
recognize" Gizenga's regime
as "a lawful and national gov-
ernment." Even in some of the
rloderate Wrench-speaking states
which were represented at the
recent Brazzaville Conference,
there is reported to be criticism
of the Kasavubu government.
Prime Minister Nehru of
India sent a strongly worded
statement to 1 ammarskjold de-
manding vigorous and prompt
action to punish Lumumba's
killers and to stop external
aid to Tshombe and Mobutu, who,
he said, shared responsibility
for Lumumba's death. He offered
to send troops to the Congo pro-
vided that the UN operation
there becomes "effective." Earli-
er he stated that the goal of the
UN Command should be to encourage
a "unified, independent, sovereign
Congo republic" and that it
should take military action if
necessary to attain this goal.
Ghana's Nkrumah sent an
"ultimatum" stating that Ghanaian
forces would be withdrawn from
the Congo if all Congolese troops
had not been "completely dis-
armed" in one month's t i::ie .
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In the Congo, although the
official Katangan version of
Lumumba's death is not accepted,
there has not been any loud
outcry. On 15 February there
were minor attacks on Belgians
at scattered points in the Con-
go. The American consul in
Elisabethville believes that
it is most likely that the de-
posed premier died in mid-Jan-
uary as a result of a miscal-
culation on the part of his
captors of the amount
16 February 1961
However, he was prepared to
increase the Ghanaian troop
contingent of 1,900 men to
accomplish this objective.
Representatives of Nigeria,
a leader of moderate Afro-Asian
opinion, have stated that if
Hammarskjold moves rapidly to
take over temporary control of
the Congo, Nigeria would in-
crease its military commitment
to the UN force. Otherwise,
they said the Nigerian units
would be withdrawn.
Sekou Tourd of Guinea ac-
;:used Hammarskjold of personal
responsibility for Lumumba's
murder. The Ethiopian demanded
that Hammarskjold bring those
responsible for Lumumba's
death immediately to justice.
Republic of the Congo of physical punishment
r? Leopoldville
?Thysville
Kindu
? Lodje
CURRENT INTELLIGENCE WEEKLY SUMMARY
Kongolo
Albertville
he could endure. The
investigating UN team
.--Ethiopian General
Iyassu and Swiss Suret6
official Knecht--has
made little progress
against the solid op-
position by Katanga
authorities.
on 12 February
Mobutu's force was to
begin a "peaceful pene-
tration" of areas held
by Gizenga's troops,
and most of his mili-
tary equipment has ar-
rived in Equateur Prov-
ince by barge from
Leopoldville, Mobutu's
plan to "win back Stan-
leyville" apparently re-
lies more heavily on
disaffection among his
opponents than on mili-
tary operations.
SECRET
Hammarskjold reportedly
sees these communications as a
"letting off of steam." He
apparently believes that these
African and Asian leaders will
realize the limited military
potential and narrow mandate of
the UN force and will moderate
their positions.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
In northern Katanga,
Tshomb6ls operation against
opposing tribal groups has so
far met little resistance from
Baluba forces, and the Katangan
troops are advancing up the
rail line from -Luena toward
Bukama.
25X1
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
AFTER;4ATH OF KHRUCHSHEV'S AGRICULTURAL TOUR
Khrushchev's 18-day tour
of key Soviet agricultural
areas has left party leaders
throughout the country keenly
aware of their personal stakes
in the future of Soviet farming.
Khrushchev advanced detailed
proposals for increasing agri-
cultural production in each
area he visited, and made it
clear that local leaders will
be held directly responsible
for carrying them out. Several
personnel changes have already
taken place; more will probably
be made as responsible officials
seek to shift the onus for past
failures onto their subordi-
nates.
Khrushchev returned to the
Kremlin on 12 February after a
swing through the Ukraine, the
North Caucasus, Georgia, and
Voronezh Oblast. His proposed
visit to the New Lands of
Kazakhstan and Siberia has not
yet taken place, however, and
there is no indication when he
intends to visit this area.
Khrushchev's speeches during
the tour were generally more
moderate in tone than his re-
marks at the January central
committee plenum. In the main,
he kept his criticisms general
and left the recitation of
specific shortcomings to the
principal party chief in each
area.
Local leaders have been
prompt to seek scapegoats. Im-
mediately after Khrushchev left
the Ukraine, members of the
Lepublic's party presidium
went to several oblasts, where
they "explained" the work of
the plenum at which they had
been forced to admit their own
poor records of leadership.
In Odessa and Lvov, Ukrainian
party boss Nikolay P,)dgorny--
a particular target af Khru-
shchev's ire in January--super-
vised the replacement of the
oblast first secretaries.
A similar shake-up took
place in Armenia shortly after
Khrushchev's address in Tbilisi
on 7 February. A plenum of
the Armenian central committee
elected ;v1ger ir1elkonyan, a
former deputy minister of agri-
culture, to the central com-
mittee secretariat and bureau,
apparently to replace B. Ye.
Sarkisov, who was responsible
for party supervision of agri-
culture in Armenia.
Personnel changes have also
been made in areas not included
on Khrushchev's itinerary.
The oblast party chiefs in
Smolensk and Kirov (RSFSR) and
in aviary (Turkmen Republic) have
been fired, and unconfirmed re-
ports indicate that a major
shake-up of the Kirghiz party
leadership has resulted in the
ouster of six members of the
republic central committee and
the dismissal from the party of
central committee member
Alukhambet Isayev. The latter's
fraudulent activities were ex-
posed at the January central
committee plenum when Khru-
shchev demanded to know why he
had been removed as first sec-
retary in Tyan Shan Oblast last
summer only to gain subsequent
appointment as republic internal
affairs minister.
The flurry of personnel
shifts seems likely to continue,
and Khrushchev is likely to re-
main personally attentive to
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
agricultural affairs, at least
until the next harvest. The
situation was summed up at the
recent meeting in Tbilisi by
party presidium candidate
Vasily Mzhavanadze: "We know
that Nikita '3ergeyevich will
tell us the bitter truth to our
faces and will perhaps again
criticize us very Justly and
deservedly."
25X1
There were no indications
during the first three days
of the fourth congress of the
Albanian Workers (Communist)
party that. Tirana intends
to abandon its pro-Chinese at-
titudes in favor of a pro-Soviet
orientation. In a belligerent
opening address on 13 February,
party leader Enver Hoxha called
for Chinese participation in
any summit talks, an issue
not raised by the USSR since
Khrushchev's speech of 28 May
1960, immediately after the
breakdown of the Paris summit
meeting. Hoxha said President
Kennedy was continuing his
predecessor's plans to initiate
a third world war. He also
claimed that the United States,
Greece, and Yugoslavia had
collaborated with Albanian
"traitors" some months ago to
overthrow his regime.
The level of bloc dele-
gations is comparable to those
sent to the last Albanian
congress in 1956, but is lower
than delegations to other sat-
ellite congresses in the last
two years. Those from Commu-
nist China, North Korea, North
Vietnam, and Czechoslovakia
are led by presidium or polit-
buro members, but most are
headed merely by central com-
mittee members. Every dele-
gation contains ideological,
propaganda, or party discipline
specialists, and several in-
clude participants in last No-
vember's conference of Communist
parties in Moscow. Petr
Pospelov, candidate presidium
member, heads the Soviet dele-
gation, as he did in 1956.
The ideological specialists
in the Soviet and European sa-
tellite delegations are probably
working in private to sway the
Albanian leadership from its
pro-Chinese course. An anti-
West, anti-Yugoslav, pro-Chi-
nese propaganda line preceded
the congress and has been main-
tained since the meeting began.
This, along with Hoxha's charge
of Western complicity in the coup
attempt, has committed his re-
gime to policies at variance
with those of Moscow. More-
over, his statement that some
of the coup participants, along
with evidence of their activi-
ties, are in the "hands of the
people's justice" suggests that
he intends to stage an anti-
Western show trial sometime soon.
Such a trial would inevitably
have overtones offensive to' Moscow.
Contrary to Hoxha's conten-
tion, the abortive coup attempt
--which occurred last summer--
was probably planned by pro-
Soviet elements in the Albanian
party and military forces,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
possibly at Soviet instigation,
to force a change in the pro-
Chinese Hoxha leadership, One
district party leader and two
district government chiefs
were removed sometime between
July and September. In early
September, politburo member Liri
Belishova and Auditing Commis-
sion chief Koco Tashko were
relieved of their posts. Accord-
ing to various reports, between
200 and 500 party members in all
were removed during this period.
Close Albanian-Chinese re-
lations were underscored by the
arrival in Albania on 9 February
of a Chinese "friendship" dele-
gation that is now touring Al-
bania making speeches and re-
ceiving wide attention in the
Albanian press. Continued Chi-
nese Communist support for the
Albanian party was strongly im-
plied in the speech of Chinese
Presidium member Li Hsien-nien
to the congress on its second
day.
25X1
Hungary has achieved or
surpassed most of the goals of
the Three-Year Plan (1958-60).
It has almost overcome the ef-
fects of emergency measures
taken after the 1956 revolt on
the distribution of national in-
come, has improved its ability
to produce industrial exports,
and has started modernizing its
industrial plant and production
techniques without returning to
the excessive pace of industri-
alization of the early 1950s.
However, economic plans for 1960
--which were above the Three-
Year Plan targets for that year
--were not fully met, and plan-
ners have set the investment
target for 1961 at a level be-
low the average for 1959-60.
HUNGARY
NATIONAL INCOME AND CONSUMPTION, 1955 - 1960
(1955=100)
P1\0
N
1957 195$ 1959
'PRELIMINARY
The Three-Year Plan re-
placed the 1956-60 Five-Year
Plan, , which was abandoned fol-
lowing the revolt. During late
1956 and early 1957, national
income was below the 1955 level,
and investments were cut to a
minimum to make more consumer
goods available. During 1958-60
the relationship between nation-
al income and consumption vir-
tually returned to that of 1955.
However, the growth rate for
national income fell last year.
During the Three-Year Plan,
national income rose 20 percent
rather than the planned 13,
investments exceeded targets,
real income of consumers in-
creased only moderately, and
gross industrial production ex-
panded 40 percent, well above
the scheduled 22 percent. Heavy
industry's share of total indus-
trial output rose to about the
same level as before the revolt.
Agricultural production, however,
increased less than the planned
12 percent.
The socialized sector of
agriculture has increased from
31 to 87 percent of arable land
since the end of 1958, and the
regime considers this the prime
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
HUNGARY: INDUSTRIAL PRODUCTION
1957 AND 1960
(1957: 100)
1957
11.0%
accomplishment of the plan
period.
However, most immediate
economic results of this reor-
ganization have not been favor-
able. Workers--especially the
younger ones--have been trans-
ferring from agriculture to in-
dustry in excessively large num-
bers, causing a disproportionate
growth of the industrial labor
force and depriving agriculture
of needed manpower. The regime
has been forced to increase
agricultural investments at the
expense of other economic sec-
tors; its plans to reduce agri-
cultural investments in 1961
will conflict with the continued
need to support collectivization
with purchases of machinery and
the construction of farm build-
ings.
Prospects are poor for a
substantial growth of agricul-
tural production in the next few
years. The outlook for the con-
sumer in 1961 is further dark-
ened by the regime's efforts to
tighten labor norms in industry.
Agricultural weaknesses
have contributed to the regime's
greatest problem--foreign trade.
Hungary was able to move from
a $194,500,000 deficit in 1957 to
a $50,000,000 surplus in 1958,
but exports have risen much
less than imports during the
past two years, with a resultant
unfavorable trade balance. This
year, repayments begin to come
due on the principal debts owed
other bloc countries; Hungary's
indebtedness following the 1956
revolt totaled $382,000,000.
Unless the Soviet Union grants
a postponement of the main debt
payments, the regime will have
to generate an export surplus
in 1961, a move which might re-
quire domestic austerit
measures. (Pre-
pared by ORR)
25X1
The East Germans were ill I as rolled steel, chemicals,
prepared for Bonn's announcement
last September that the inter-
zonal trade agreement would be
abrogated as of the end of 1960.
They apparently had taken few
precautionary measures to devel-
op alternate sources of supply,
in spite of their dependence on
West Germany for such products
chemical equ,Lpment, and a
variety of machinery components.
In emergency steps to mini-
mize disruption of production
schedules, the East Germans
tried to increase domestic pro-
duction of items imported from
West Germany, conserve existing
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
supplies, and find substitute
products or immediate alternate
sources of supply. Special
commissions and working groups
were set up to investigate
the effects of a cessation of
interzonal trade and to find
other sources on a long-term
basis.
Since the reinstatement of
the trade pact on 30 December,
East Germany has continued its
attempt to decrease its depend-
ence on the West for essential
imports while maintaining the
volume of trade at past levels.
Stressing that the achievement
of independence from Western
imports remains a major po-
litical goal, the State Planning
Commission has decreed that any
attempt to procure imports from
the West in preference to sub-
situtes available from CEMA
countries would be considered a
"breach of long-range policy de-
cisions taken at the highest
party levels."
Industrial and foreign
trade planners have been in-
structed to "achieve independ-
ence" from Western supplies by
1962. Wherever possible, do-
mestic production of vital ma-
terials will be increased, con-
struction and manufacturing in-
dustries will use raw materials
produced domestically or avail-
able within'the bloc, and in-
dustry will begin immediately
to transform industrial stand-
ards from the DIN (German)
system.to the GOST (Soviet);
system. Conservation of mate-
rials will continue to be
stressed, and domestic products
will be substituted for imports
wherever feasible. Stockpiling
of vital materials not produced
in sufficient amounts within the
bloc would also appear neces-
sary.
East Germany's program to
reduce its dependence on Western
supplies apparently was not So-
viet inspired but no doubt has
Ioscow's approval. Reduction
of vulnerability to Western
economic sanctions would in-
crease the bloc's ability to
implement diplomatic and stra-
tegic moves affecting Berlin.
There is some question,
however, concerning Soviet will-
ingness to absorb the cost of
this program. The Soviets re-
portedly agreed initially to
increase their own shipments of
needed supplies to East Germany
if those from West Germany were
cut off. Now that interzonal
trade has been re-established,
however, Moscow has retracted
its offer, at least for some
commodities, and apparently
does not plan any major adjust--
&ents in its economic plans or
in those of other C1 1A countries
in order to accommodate East
Germany. Some Soviet aid per-
haps can be expected to result
from negotiations now under way
in Moscow, but it is unlikely
that it will be of the scope
originally anticipated by East
German planning officials.
East Ge.rmany's success in
pursuing its new trade policy
toward the West will depend on
now efficiently it expands its
domestic production and uses
available raw.materials, as
well as on its ability to adjust
its trade with both the West
and the bloc without disrupting
the plans of other bloc coun-
tries. East Germany undoubted-
ly can reduce its dependence on
certain of its West German im-
ports,, but it is unlikely that
the,measures instituted thus
far will adequately reduce de-
pendence on such important com-
modities as steel.
(Prepared by ORA)
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16 February 1961
East Germany's recent ac-
tions indicate that it is test-
ing West Germany's willingness
to take countermeasures to force
the regime to carry out its
promise to the West Germans to
relax controls on the Berlin
sector border and make certain
technical concessions to facil-
itate trade between West Berlin
and West Germany. The East Ger-
man promise was instrumental in
inducing Bonn to agree on 29 De-
cember to reactivate the inter-
zonal trade agreement for 1361.
Bonn had abrogated the pact fol-
lowing East Germany's harassing
actions against West Berlin last
September.
The East German negotiator
in interzonal trade talks held
on 8 February to discuss the im-
plementation of the 23 December
agreement read a long state-
ment to the effect that the re-
gime was not then in a position
to carry out its undertakings,
claiming that the Federal Re-
public had violated its promise
to maintain complete secrecy on
the concessions. As a result,
the talks were broken off. on
1-' February, however, they re-
sumed, and the East German ne-
gotiator took a somewhat more
conciliatory attitude, saying
that the Communist regime would
soon carry out its commitment
to permit the sealing of trucks
moving between West Berlin and
West Germany.
Two days later, the East
German negotiator claimed that
the regime had implemented cer-
tain concessions, relating to
trade traffic, that it intended
to carry out the others, and
that it was studying the matter
of border controls. The West
German negotiator, not satis-
fied with this statement on bor-
der controls, demanded a satis-
factory proposal by midnight.
Later that day, East Berlin po-
lice announced that new regula-
tions would go into force at
midnight to "satisfy and facili-
tate" the issuance of passes to
West Germans to enter East Ber-
lin.
While the regime probably
will claim that this police meas-
ure fulfills its promise to ease
controls, the regulations ex-
pressly reassert the validity
of the 8 September decree de-
manding that West Germans secure
passes. This decree violates
the quadripartite status of Ber-
lin. The East Germans, moreover,
are refusing to conclude long-
-term contracts with West German
:firms, which require revocable
shipping licenses. Bonn had
counted on this licensing pro-
cedure as a means to hold East
Germany to its commitments.
The USSR does not appear
to be interested in creating a
major crisis over Berlin at
this time, but probably is not
averse to allowing East Germany
to maintain a degree of pressure
on the issue. East Germany's
tactics suggest that it believes
it can maneuver the West Germans
into continuing trade, despite
the Communist regime's failure
to carry out its promises. The
East Germans may have estimated
--and informed Moscow--that Bonn
would be reluctant to take dras-
tic countermeasures to hold them
to their commitments.
The East German action in
barring a number of high West
German Evangelical churchmen from
attending religious services in
East Berlin on 12 February prob-
ably was an attempt to demon-
strate publicly the regime's
claim to "sovereignty" over the
Soviet sector, as well as a fur-
ther step in its long-term pol-
icy of separating the Evangelical
congregations in East Germany
from their leaders in West Berlin
and West Germany. The Communist
regime indicated earlier that it
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16 February 1961
would not permit the Evangelical
Church to hold meetings of its
synod in East Berlin, as had
been done in the past, but would
permit religious services on 12
February. On 9 February party
boss Ulbricht delivered a scorch-
ing attack on the "NATO politi-
cians" in the Evangelical Church,
declaring that they had "no
business in the capital of the
German Democratic Republic."
The Communist government
does not appear to have made any
attempt to prevent East German
ecclesiastics from attending the
synod in West Berlin nor did
East German police bar Bishop
Otto Dibelius of Berlin-Branden-
burg from attending the reli-
gious services in East Berlin.
Dibelius has long been a target
of abuse and legal proceedings
are pending against him in East
Berlin courts for "advocating
resistance to the state power."
In view of the East Ger-
man actions, Bonn is consider-
ing reinstating its boycott of
the Leipzig Fair to be held
5-14 March. The West German
cabinet was scheduled to con-
sider the matter at a 16 Febru-
ary meeting.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
General Ne Win's order in
early February ousting 11 senior
officers from their commands
appears to have thwarted any
early army coup against Prime
Minister Nu's government in Bur-
ma. In addition, Ne Win's ac-
tion underscored his personal
dominance of Burma's career of-
ficer corps and his determina-
tion that his subordinates sup-
port his policies fully. His
immediate motive was to ensure
the completion of the Sino-
Burmese border demarcation proj-
ect, which he believes is con-
tingent on Nu's remaining pre-
mier.
The ousted officers made
up the core of the army's ex-
perienced field commanders and
administrators. They opposed
Ne Win's original decision to
return the government to civil-
ian control in 1960 and contin-
ued openly critical of his non-
intervention with Nu's inept
domestic administration and cur-
rent rapprochement with Peiping.
Through former army train-
ing director Brigadier Maung
Maung, the officers had pressed
Ne Win for an extension of the
American military aid program,
despite the general's known ir-
ritation with the number of
American personnel with the Bur-
mese Army and his fear that they
might become a source of embar-
rassment in Burma's relations
with Communist China.
Although these leading
critics of Ne Win's policies
have now been removed from their
influential posts, many of their
The command shake-up, how-
ever, probably will have an ad-
verse effect on the countrv'q
political stability. It has
weakened the army as the one
disciplined base of political
power and may undermine its
morale and efficiency against
the insurgent forces in the
country.
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16 February 1961
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supporters are still in.the army,
and probably will continue quiet
agitation for more active army
influence with the government.
LONDON SEEKING TO CONFEDERATE SINGAPORE AND BORNEO WITH MALAYA
London is promoting a con-
federation linking Singapore
and the Federation of Malaya
with Britain's three Borneo ter-
ritories--North Borneo, Sarawak,
and Brunei. One purpose of Com-
monwealth Relations Secretary
Duncan Sandys' visit to Malaya
last month apparently was to urge
support for this project.
Although there has been
some favorable response through-
out the area, Malayan Prime
Minister Rahman has reiterated
his adamant opposition to the
inclusion of Singapore in such
a union. Malays outnumber the
Chinese in the Federation of
Malaya, but would be in a slight
minority in a confederation in-
cluding Singapore. Rabman is
also concerned about the leftist
inclinations of the Singapore
Chinese.
The British plan apparently
envisages that Malaya would
POPULATION OF MALAYSIA
to from 1957 census excepting 1960 figures for Singapore)
(square Em les)
MALAY
CHINESE
INDIAN
INDIGENOUS I
TRIBES
OTHER
TOTAL
MALAYA
50,690
3,126,706
2,332,936
695,985
----
123,136
6,278,763
SINGAPORE
224
227,300
1,230,700
137,800
----
38,300
1,634,100
SARAWAK
47,500
148,567
197.723
(Included in "Other")
282,835
9,237
638,362
NORTH BORNEO
29,388
22,750
97,248
(1ncluded
in "Other")
268,498
12,330
400,826
BRUNEI
2,226
36,576
14,183
(Included
in "Other"
17,915
5,972
74646
'
130,028
3,561,899
3,872,790
833,785
569,248
,975
188,975
9,026,697
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
31600
'NORTH ?O
BORNEO
Celebes sea
assulne--at least outwardly--the
authority now exercised by the
British in all but Malaya in
the fields of defense, foreign
relations, and internal security.
Each of the states, which would
otherwise be autonomous, would
be represented in the Malayan
parliament, but not on a popu-
lation basis. In the formative
years, the British would pre-
sumably expect to exercise con-
siderable influence in an advi-
sory capacity.
Britain probably would
also step up the political de-
velopment of the Borneo terri-
tories. The colony of Sarawak
now is the most politically ad-
vanced and has rudimentary rep-
resentative institutions already
in operation; the colony of
North Borneo is the most back-
ward and is only beginning lim-
ited self-government. Brunei,
a British protectorate, is in
the initial stages of developing
representative insti-
tutions, although its
sultan retains almost
absolute power over
internal affairs.
Such a grouping
has been under con-
sideration for many
years in order to free
Britain of responsi-
bility and ensure a
means for eventual
independence for the
underpopulated and
culturally fragmented
Borneo territories.
The British are addi-
tionally concerned
about the future of
Singapore as a semi-
autonomous state and
now apparently feel
that it should be in-
cluded in a regional
grouping. Last October the
British reportedly tried to con-
vince Malayan Deputy Prime Min-
ister Razak that merger of Sing-
apore with Malaya was essential
in order to bolster Singapore's
economic prospects and to im-
prove its chances of long-range
political stability.
Personal relations between
Rahman and Singapore's Prime
Minister Lee Kuan Yew have im-
proved recently, and some high
Malayan officials have reported-
ly become sympathetic toward a
grouping including Singapore.
By supporting Malaya's interest
in a link with the Borneo terri-
tories, the British may hope at
the meeting of Commonwealth
prime ministers in March to per-
suade Rahman to agree that the
presence of the Borneo terri-
tories in a confederation would
partially offset the influence
of Singapore.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
RHODESIA-NYASALAND
The two separate constitu-
tional conferences recently
held between British cabinet
ministers and representatives
of political factions from both
Northern and Southern. Rhodesia
may arouse racial conflicts in
central Africa and possibly lead
white-controlled Southern Rho-
desia to attempt to secede.
Colonial Secre-
tary Macleod's pro-
posals, presented to
the Northern Rho-
desian conference in
London on 14 February,
were described by
British officials as
attempting to achieve
"parity" between Af-
ricans and whites in
a legislature elected
by a broadened fran-
chise. A Common-
wealth Relations Of-
fice official indi-
cated that the pro-
immediate threat of African-
instigated disorders, the feder-
al government on 12 February
called up the territorial re-
serves in Northern Rhodesia and
assigned them to likely trouble
spots in the urban areas.
In another round of nego-
tiations at Salisbury, Common-
BACKGROUND
The semi-independent Federation was formed in 1953 from the
self-governing colony of Southern Rhodesia and the British protec-
torates of Northern Rhodesia and Nyasaland, still administered by
British governors. London supported federation in order to prevent
the spread of South African racial doctrines into Central Africa
and to facilitate area economic planning. The Africans, strongly
opposed the imposition of a white-controlled federal goverment.
Nyasaland will have an elected African majority in its.
legislature after elections this year, similar changes are being
considered for Northern Rhodesia. Southern Rhodesian African.
have been accorded minority representation under new constitu-
tional proposals.
The white settlers, who have been politically and econdnnically
dominant, constitute less than 4 percent of the population of 8,-
430,000. The Federation's economy is the second most developed in.
Africa; copper mining in Northern Rhodesia is the most important
posals are not intended to pro-
duce an African majority at pres-
ent. The British could pre-
sumably arrange this later
either through nominated mem-
bers or by lowering the fran-
chise qualifications.
These proposals--which Lon-
don is apparently unprepared to
modify--are not expected to
satisfy either the Africans or
white settlers, but the British
hope for acceptance as the best
available solution.
African leaders have in-
sisted on a majority of Afri-
can-elected members in both the
legislative and executive coun-
cils and have threatened vio-
lence if their demands are not
met. On the other hand, Federa-
tion Prime Minister Welensky
had asserted earlier that South-
ern Rhodesia would leave the
Federation if London insisted
on an African majority in
Northern Rhodesia. To meet the
wealth Relations Secretary
Sandys and Southern Rhodesian
officials, including African
representatives, reached an
agreement which has been sup-
ported so far by all factions
except extremist groups among
both settlers and Africans.
The agreement, which is subject
to British parliamentary approv-
al and a Southern Rhodesian
referendum in June, in general
expands African political in-
fluence while increasing South-
ern Rhodesia's powers of self-
government.
The Salisbury conference
agreed on a bill of rights in
the Southern Rhodesian consti-
tution, a dual electoral roll
system by which, in essence,
70,000 white voters will elect
50 representatives and some 50,-
OUv Africans will elect 15 re-
presentatives, and a constitu-
tional council to safeguard
civil rights with the power to
delay discriminatory legislation
for six months.
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British officials in London
have confirmed that, in return
for Southern Rhodesian accept-
ance of these pro-African pro-
visions, the agreement envisages
surrender by London of its re-
serve powers to veto Southern
Rhodesian legislation on African
affairs. This has been one
of London's major means for in-
fluencing Southern Rhodesia.
Although Southern Rhodesian
Prime Minister Whitehead has
stated publicly that the fran-
chise agreement will result in
control of the government by
white voters "for all time,"
the opposition segregationist
Dominion party has refused to
agree to the proposals and has
threatened to advocate seces-
sion. There is also some dis-
satisfaction in African circles
over the limited gains made at
the conference, and the posi-
tion of moderate Joshua Nkomo,
leader of the National Democrat-
ic party, may be weakened by
extremist agitation.
The Rhodesian conferences
may also provoke political strains
in British Conservative party
policy on Africa. Some parlia-
mentary elements already resent
Colonial Secretary Macleod's al-
leged "sellout" of the white
minorities, and Macleod is re-
portedly irritated by Sandys'
successful competition with him
in resolving African colo-
nial problems.
CENTRAL AFRICAN
REPUBLIC
CONGO
GABONt
SOUTH-WEST
AFRICA
16 !?E8RUARY 1061 BECHUANALAND
q ? !,ES s?. //
25X1
25X1
25X1
Portugal's overseas prov-
ince of Angola has been the
scene of several outbreaks in
the last two weeks, and offi-
cials there expect further dis-
orders. Security controls, par-
ticularly over Africans, have
been tightened in Luanda, the
capital.
a 150-man com-
pany of paratroopers has been
airlifted from Portugal. Re-
ports of incipient unrest have
come also from Mozambique,
Portugal's East African pos-
session.
The focus of the Angolan
disturbances was Luanda, where
some 40 persons were killed in
clashes beginning on 4 February.
In addition, there reportedly
have been outbreaks in north-
central Angola. The demon-
strators in Luanda apparently
were organized according to a
pre-arranged plan; on 4 February
they made coordinated attacks
on three different points, and
the attackers on 10 February
wore a uniform of blue shirts,
khaki trousers, and white belts.
The motivation of the dem-
onstrators and the extent of
their contacts outside Angola
are unclear. F7 I 25X1
FEDERATION if
OF RHODESI~.
Yom. 1 ./X.ND ? Salisbury
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16 February 1961
ere is no evidence of links
between the Luanda action and
any nationalist movements abroad.
However, Roberto Holden--also
known as Jose Gilmore--a moder-
ate, anti-Communist Angolan ex-
ile who heads the Union of the
Angolan People (UPA), recently
stated that the violence had
been fomented by the Communist-
supported African Front for the
Independence of Portuguese
Colonies in Africa (FRAIN) based
at Conakry. Holden apparently
believes that the outlook is
for increasing violence as anti-
Portuguese and anti-white Af-
rican extremists acquire great-
er influence over the Angolan
native population.
FRANCE-ALGERIA
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
De Gaulle apparently be-
lieves that his talk with Tu-
nisian President Bourguiba,
which has been arranged for
later this month, will help pre-
pare for French-PAG talks. De
Gaulle recognizes Bourguiba is
greatly concerned over the
growing influence of radical
African and Communist forces
on the Algerian rebel leader-
ship.
Members of the PAG continue
to indicate a desire for a ne-
gotiated settlement, and insist.
that they have a mandate to
negotiate for the Algerian
people. They are said to have
agreed unanimously during their
January meeting that they would
not recognize or deal with any
interim Algerian government set
up unilaterally by Paris but
nevertheless realize that nego-
tiations with Paris cannot give
them immediate control over Al-
geria.
Rebel "deputy premier and
foreign minister" Belkacem Krim
reportedly persuaded the con-
ference of foreign ministers of
the Arab states which ended in
Baghdad on 3 February not to es-
tablish a boycott or sever dip-
lomatic relations with France.
He is said to have emphasized
that only De Gaulle could solve
the Algerian problem, and that
he must be given time to do this.
The PAG will resent any in-
timation that Bourguiba's talks
with De Gaulle will involve
substantive negotiations. The
rebel "minister of information"
has complained that the PAG was
not consulted about De Gaulle's
invitation to Bourguiba, and an-
other PAG representative told
a member of the American Embassy
in Tunis on 9 February that
while Bourguiba has "every right
to go to Paris," there can be
no substitute for direct nego-
tiations. 25X1
Bourguiba's 25X1
intention in seeing De Gaulle
is to strengthen the position
of moderate elements in the
PAG, but that the mission could
have the opposite effect..
Bourguiba himself is grati-
fied that De Gaulle has picked
him as a go-between rather than
his rival. for influence in the
Maghreb, Moroccan King Mohamed
V. At the same time, Bourguiba
probably fears jeopardizing his
future influence in Africa
should his visit not lead to
early French-Algerian negotia-
tions.
PROSPECTS FOR ICELAND
Shortly after assuming of-
fice in November 1959, Iceland's
Conservative - Social Democratic
government instituted a far-
reaching economic stabilization
program to overcome persistent
inflation and the related prob-
lems of a chronic trade deficit
and a shortage of foreign ex-
change.
Since parliamentary ap-
proval of the program last Feb-
ruary, much progress has been
made toward achieving a stable
economy and reducing Iceland's
trade dependence on the Soviet
bloc. Following Reykjavik's
relaxation of restrictions on
trade with the West, bloc trade
dropped from 34 percent of Iceland's
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 February 1961
total trade to 25 percent in
the first half of 1960. The ul-
timate success of the program
depends heavily on its contin-
ued tacit acceptance by the rank
and file of organized labor.
The Communist-dominated
central trade union federation,
whose affiliates have been work-
ing without wage contracts since
September 1059 and thus could
strike at any time, has hesi-
tated to call politically moti-
vated strikes because of the
opposition of most workers. In
recent weeks, however, there
have been indications that the
Communists are actively encour-
aging member unions to seek un-
realistic wage increases in
order to breach the government's
wage policy and frustrate the
effective working of the pro-
gram.
Success in this attempt
would probably force a reorgan-
ization of the government. Cer-
tain elements in the coalition
might be willing to consider
bringing Communists into the
cabinet if such a solution would
guarantee labor peace.
The government is also under
attack by the Communists and the
Progressives for opening negotia-
tions with Britain last October
on the long-standing fishinglim-
its dispute. The talks are dead-
locked over technical points and
Iceland's determination to reserve
its right to extend control over
fishing into areas even beyond
the disputed 12-mile limit. Lon-
don is trying to reach an agree-
ment this month; in a recent note
it warned Iceland that failure to
do so could lead to a recurrence
of armed clashes when the spring
fishing season opens.
Communists and certain na-
tionalist groups demand that the
government terminate the talks,
hoping thus to strain relations
between the two NATO allies and
discredit Iceland's membership in
the alliance. Although unsuccess-
ful in their continuing efforts
to arouse public opinion over the
once-popular issue of the Keflavik
air base and the American forces
stationed there, these groups are
seeking tc embroil the US in the dispute
by demanding that the defense force
"protect" Iceland from incursions
by British fishing and patrol
craft.
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CHINESE COMMUNIST ACTIVITIES IN LATIN AMERICA
Recognition by Cuba last
year gave Communist China its
first diplomatic ties with any
country in the western hemi-
sphere. Believing that the Cuban
example offers an opportunity
for further gains in Latin Amer-
ica, Peiping is willing to ac-
cept the cost of sizable econom-
ic assistance to the Cubans. Its
strategy for the area as a whole
combines a reliance on "people's
diplomacy" with an expansion of
Chinese influence in Latin Amer-
ican Communist parties. The ob-
jective is to win political rec-
ognition and encourage revolu-
tionary action.
Following the US decision
last summer to stop buying Cuban
sugar, the Chinese agreed to
take 500,000 tons annually for
the next five years, more than
twice their previous yearly pur-
chases from nonbloc sources. Al-
though sugar is in short supply
in China, it is a low-priority
import, and Peiping's willing-
ness to forego the purchase of
more urgently needed commodities
underscored its determination to
use Cuba as the wedge to expand
its influence in the whole area.
This motive has also been demon-
strated by the willingness to
ship rice to Cuba at a time when
China is experiencing severe
food shortages and making sub-
stantial purchases of food grains
outside the Communist bloc.
When Che Guevara visited
China last November, Peiping of-
fered him a $60,000,000 interest-
free loan--at the time the larg-
est single credit extended by
China to a nonbloc country. The
Chinese also agreed to pay a
higher price per pound of sugar
than agreed to last summer and
to double their sugar purchases
to a million tons in 1961. The
Cubans have given lavish pub-
licity to China's beneficence.
During Guevara's visit the
Chinese far surpassed their usu-
al great hospitality for offi-
cial visitors. Both Mao Tse-tung
and Chou En-lai had "intimate"
talks with him, and the Chinese
ambassador-designate to Cuba es-
corted him on a tour of the country.
In an exchange of speeches
with Guevara, Chou congratulated
Cuba on its "face-to-face strug-
gle against heinous US imperial-
ism." Chou stated that while
Latin America faces a "complex
and arduous" task in freeing it-
self from the United States,
Cuba's success stands as proof
that the situation is "extremely
favorable." For his part, Guevara
amplified earlier statements by
Cubans that their revolution had
drawn on Chinese experience, say-
ing the Chinese example "revealed
a new road for the Americas:'.'
Guevara expressed admiration for
China's communes and other social
innovations and forecast that
Latin Americans would adopt "one
of these methods or something
similar" when they achieved their
"liberation."
Guidance to Communist Parties
The Chinese did not assume
a role in influencing Latin Amer-
ican Communist parties until after
the 21st Soviet party congress in
January 1959. At that congress,
Soviet officials, concerned that
publicity over Moscow's domina-
tion of the Communist movement
had hampered the activities of
Communist parties, told the Lat-
ins to play down their subordina=-
tion to Moscow.
Moscow's decision to dis-
guise its role was Peiping's op-
portunity. Delegates to the So-
viet congress from 12 Latin Amer-
ican parties traveled on to Pei-
ping at Chinese expense in March
1959. Mao Tse-tung and Liu Shao-
chi conferred with them, impress-
ing on them the suitability of
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16 February 1961
Chinese revolutionary tactics to
their problems.
The Chinese opened a school
for Latin American Communists in
Peiping in August 1959, China's
most ambitious undertaking in
training foreign Communists. The
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Ground for dissension between
China and the Soviet Union is
thus being developed in Latin
America. During the meeting of
Communist parties in Moscow last
November, the effectiveness of
Chinese proselytizing was shown
when some of the Latin American
parties reportedly supported the
Chinese against the Soviet party
members on many of the issues
being debated. If Moscow had in-
deed earlier encouraged Peiping's
desire for a greater role in Lat-
in America, the disagreements be-
tween the two countries--includ-
ing the dispute over the proper
tactics to be followed in under-
developed areas--have since un-
doubtedly occasioned second
thoughts within the Kremlin.
At the outset, the USSR
seemed to encourage Peiping's
desire for a greater role in
Latin America. The Soviet ambas-
sador in Tokyo, for example, sug-
gested to Latin American diplo-
mats there in 1959 that they
visit China and offered to make
the arrangements.
Peiping seems to have had
some success in convincing Latin
American Communists of the use-
fulness of Chinese experience.
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(Younger, more rad-
ical members of the Cuban Commu-
nist party reportedly are turn-
ing toward Peiping for inspira-
tion, although the more moderate
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tion from Moscow.
Trade agreements with Cuba
provide for an exchange of as
much as $180,000,000 in 1961--
far in excess of China's past
trade with all of Latin America.
As a rule, imports from Latin
America have been limited to a
single commodity from any one
country; Chinese purchases have
thus assumed in some countries
greater importance than the com-
paratively modest levels of total
trade would suggest. In 1958
China--which purchased almost
100,000 tons--was the largest
single buyer of sugar from Brazil,
and in the first four months of
last year it was the largest bloc
purchaser of wool tops from Uru-
guay--$2,600,000 worth.
Peiping's strategy is to
use trade as an opening for gov-
ernment-to-government economic
agreements--in effect de facto
recognition. To date, however,
Cuba is the only Latin American
country that has signed a trade
and payments agreement with Com-
munist China, and, barring polit-
ical changes in other Latin Amer-
ican countries, there are no im-
mediate prospects for others.
People's Diplomacy
In 1959, 402 Latin Americans
traveled to Communist China, with
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the Chinese paying all or part
of their expenses. This number
--three and one-half times the
total for each of the two preced-
ing years--was probably at least
equaled in 1960. Latin American
visitors to China have included
parliamentary groups from Brazil,
Peru, Colombia, and Costa Rica.
16 February 1961
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An equal effort is made to
carry Peiping's message to those
who cannot make the trip. The
"people's diplomacy" offensive
in South America was launched in
1956 with the dispatch of a Pei-
ping Opera group to Brazil, Uru-
guay, Argentina, and China. Sub-
sequent travelers, including
"friendship teams" of dancers,
journalists, and acrobats, have
been well received by the local
populations, although they en-
counter considerable governmental
suspicion.
The first group of journal-
ists, led by an officer from the
propaganda department of the Chi-
nese Communist party, organized
a local friendship association
in Uruguay and attempted to hire
a local news reporter for the New
China News Agency (NCNA). A sec-
ond group last year was even more
aggressive--particularly in Chile,
where it made political state-
ments attacking the US and cul-
tivated contacts with labor lead-
ers and leftist political leaders.
Friendship organizations
promoted by the Chinese now op-
erate in ten Latin American coun-
tries, and last March an over-all
China - Latin America Friendship
Association was formed in Peiping
to improve area-wide coordina-
tion. Peiping uses the friend-
ship organizations as channels
for getting propaganda material
into countries where free entr
is prohibited.
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Peiping contributes to the
treasuries of these organizations
from the earnings of its song-and-
dance troupes. The Colombian
Friendship Association got the
proceeds of the Peiping Opera
company's performances in Bogota
last May.
Propaganda
Peiping each week broadcasts
21 hours of Spanish-language pro-
grams to Latin America and half
as much in Portuguese. It also
publishes a Spanish-language edi-
tion of the propaganda magazine
China Reconstructs.
To pick up items of inter-
est for its radio programs, the
official NCNA--working through
the local Communist parties--is
establishing a network of corre-
spondents in Latin America; it
has recruited correspondents in
Argentina, Chile, Costa Rica,
Cuba, Panama, Brazil, Colombia,
Peru, and Venezuela. The Chinese
also employ Latin Americans in
the Peiping headquarters of NCNA
and the Foreign Languages Press.
The Havana office of NCNA is
the center for Peiping's propagan-
da activities in Latin America.
After its establishment in June
1959, the Havana office quickly
established close relations with
Castro's new Prensa Latina news
agency
In November 1959 the Chinese
Communists began publication of
a Chinese-language newspaper in
Cuba, intended primarily for the
island's 30,000 Overseas Chinese
but directed also to the 65,000
Chinese elsewhere in Latin Amer-
ica. Peiping has long competed
with Taipei for the allegiance
of Overseas Chinese living
throughout the world.
Peiping's propaganda pictures
the US as the villain in Latin ' Amer-
ica, intent on plunder and eager to
support dictators. Peiping alleges
that a common "subjugation to im-
perialist aggression and oppres-
sion" makes the Chinese comrades-
in-arms of the Latin Americans in the
fight against US imperialism. Pei-
ping's propaganda portrays the Lat-
in Americans as being in the "front
line" of the anti-US struggle of un-
derdeveloped countries and points
to Cuba as proof that their efflrts
can succeed.
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