WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A004600010001-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 30
• Document Creation Date: December 21, 2016
• Sequence Number: 1
• Content Type: SUMMARY

21 August 1964
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
State Dept. review completed
iownn,uaina , ,K 's ciassi fi cation:
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SECRET
(Information as of 1200 EDT, 20 August 1964)
THE COMMUNIST WORLD
TONKIN GULF CRISIS
Hanoi and Peiping are still propagandizing about the
US attack on North Vietnam but it appears that a major
increase or repositioning of Chinese armed forces will
not result from the US air strike of 5 August.
Page
1
SOVIET REACTION TO THE CYPRUS CRISIS
Moscow will probably continue to exert indirect pressure
on Turkey and the West in the hope of influencing the
course of events without committing itself to any specific
course of action.
CREDITS REMAIN A KEY SOVIET TRADE PROBLEM
The USSR uses a cut-back in orders for western equip-
ment to spur competition to provide long-term credits on
favorable terms.
USSR CUTS SCHOOL PERIOD TO TEN YEARS
The change de-emphasizes the vocational aspects of sec-
ondary schooling and will add half a million workers to
the labor force in 1965-1966.
YUGOSLAV-US RELATIONS
Recent statements blaming the US for contributing in
varying degrees to the crises in Vietnam, Cyprus and
the Congo probably stem from Yugoslavia's desire to
enhance its role as a leader of the nonaligned states
and maintain its identity with the socialist countries.
NORTH KOREA ASSESSING FREE WORLD MARKETS
Delegations now visiting non-Communist countries are
showing particular interest in heavy industrial equipment.
SUKARNO MOVING FURTHER LEFT
In his independence day speech, the Indonesian president
charted international and domestic policies close to those
espoused by the Indonesian Communist Party.
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EUROPE Page
MALTESE POLITICAL DEVELOPMENTS 17
London threatens to withhold announcing Malta's
independence date until discrimination clauses are
removed from the colony's proposed constitution. Malta's
bid for full membership in NATO is not being favorably
received.
HAITIAN GOVERNMENT'S ANTI-REBEL ACTIONS STILL INEFFECTIVE 18
The two rebel groups apparently still evade and confuse
Duvalier's forces
THE DOMINICAN REPUBLIC'S AUSTERITY PROGRAM
The provisional government is trying to win popular
support for its austerity program to correct the balance
of payments and stabilize the peso, but politicians and
businessmen may use the hardships incurred to try to oust
the regime.
ANTI-GOVERNMENT ACTIVITY IN BOLIVIA 20
Guerrilla activity, unrest among miners, and discord
within his own party are plaguing President Paz Estenssoro.
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Both Hanoi and Peiping in-
dicated this week that they
would react strongly to any
further US "aggression" against
North Vietnam. It appears, how-
ever, that a major increase or
repositioning of Chinese armed
forces will not result from the
US air strike of 5 August.
Civil air raid defense
measures in Hanoi reportedly
have been increased, and the
North Vietnamese have persisted
in their charges that US planes
their charges that US planes
are violating their air space.
They apparently hope to prove
to international audiences that
the US is still engaged in a
concerted campaign of "aggres-
sion" against North Vietnam.
For its domestic listeners, how-
ever, the regime emphasized that
current US activities should not
deter North Vietnam from its
primary goal of "economic prog-
ress." Hanoi is clearly attempt-
ing to use the bugaboo of US
"aggression" to spur greater in-
dustria.l and agricultural en-
deavor from its apathetic popu-
lace.
In the apparent hope of
inhibiting support by Laos and
the Republic of Vietnam for US
policy toward North Vietnam,
Communist propaganda alluded to
the possibility of a broadened
military front in Indochina if
alleged American activities
against the North continued to
be staged from Laotian and South
Vietnamese bases. The most
forthright statement along these
lines appeared in the Japanese
press on 13 August in an article
by the pro-Communist Australian
journalist Wilfred Burchett, who
enjoys close relations with Hanoi
leaders. Burchett claimed that
the "immediate result" of con-
tinued "US attacks" would be a
"military reunification" of
North Vietnam with areas con-
trolled by the Viet Cong and
the Pathet Lao. North Vietnam
has not repeated Burchett's com-
ments.
The mass protest rallies
in China tapered off sharply
during the past week, and the
inflammatory broadcasts by Chi-
nese regional stations were dis-
continued. Peiping, however,
still tried to keep international
attention focused on US "aggres-
sion" in Vietnam. Foreign Minis-
ter Chen Yi's warning that the 25X1
crisis was "far from closed" has
hen reiterated
Peiping 's right to 'assist the 25X1
Vietnamese people in their fight,"
and insisted that the US must be
punished for its acts-- "the
blood debt must be repaid."
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In contrast to its propa-
ganda focus on appeals to the
Geneva signatories and to the
ICC, Hanoi has not permitted
the ICC teams in North Vietnam
to make any extensive investiga-
tion of the events of 2-5 Au-
gust, and the Polish member of
the ICC has cooperated with the
usual delaying and obstruction-
ist tactics. The DRV has still
not admitted that any signifi-
cant damage resulted from the
5 August air strike.
21 Aug 64
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The USSR has recently in-
creased its pressure on Turkey
over Cyprus, but at the same
time has carefully avoided any
specific commitment of military
or economic support of the Ma-
karios government.
This activity is similar
to Soviet behavior during pre-
vious Middle Eastern crises when
the USSR utilized military alert
measures such as aircraft and
troop movements
and imprecise pu is
statements to give the impres-
sion that military intervention
was imminent. This process of
diplomatic and propaganda intim-
idation did not involve any com-
mitment to action, but provided
an opportunity for the USSR to
claim credit for having forced
the "aggressor" to back off.
Moscow probably regards
the Cyprus crisis as an oppor-
tunity to weaken Western influ-
ence in the eastern Mediterra-
nean and to enhance its own pres-
tige in the Afro-Asian world as
the supporter of small national-
ities oppressed by the West.
Since the crisis began last De-
cember, the Communist Party of
Cyprus has greatly expanded its
influence, Soviet prestige has
risen sharply in Cyprus, and
the southern flank of NATO has
been disrupted by Greek-Turkish
antagonisms.
These trends--favorable to
Soviet interests--have developed
without Moscow's becoming di-
rectly involved in the dispute,
and Soviet leaders probably real-
ize that direct action could
only jeopardize these gains. The
USSR almost certainly will not
attack Turkey, a NATO power,
since this would involve a direct
confrontation with the US. Mos-
cow probably also realizes that
any effort to provide the Greek
Cypriots with significant mili-
tary materiel would lead to a
full Turkish invasion of the is-
land. The USSR, moreover, is
probably aware of Greek concern
at the drift of the Makarios
government toward Moscow and rec-
ognizes that a threat of direct
Soviet involvement might precip-
itate enosis (union with Greece).
Moscow will continue to be
subjected to Greek Cypriot pres-
sure for tangible evidence of
support and may feel the need
to demonstrate militancy in the
face of Chinese charges of weak-
ness before the West. However,
while continuing to encourage
Greek Cypriot expectations of
Soviet economic and military aid,
Moscow will probably maintain
its cautious policy of nonin-
volvement. In pursuing th)s
policy the USSR will probably
continue to exert indirect pres-
sure on Turkey and the West in
the hopes of influencing the
course of events without commit-
ting itself to any specific course
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CREDITS REMAIN A KEY SOVIET TRADE PROBLEM
Soviet imports of machin-
ery and equipment this year
will probably remain at last
year's level, but orders for
future deliveries have fallen
off sharply since late 1963,
when Moscow decided to buy $800
million worth of wheat and tem-
porarily stopped placing other
contracts requiring the outflow
of hard currency.
The USSR has attempted to
use this slackening of orders
to lure would-be suppliers into
granting long-term credits at
low rates of interest. Khru -
shchev recently stated that the
USSR was "filled to capacity
with credits for five years,
and now accepts credit only for
10 to L5 years." It is evident
that this applies not only to
newly planned purchases, but to
programs that have been under
way for some time. The rate
of Soviet purchases on credit
in-the West has risen faster
than the rate of total purchases.
The USSR acknowledges that
without government guarantees
Western financial institutions
are not likely to offer credit.
It has been trying to get Paris
to disregard the five-year Bern
Union limitation to which Com-
mon Market countries subscribe.
Failing this, Moscow has sought
a formula that would give the
appearance that Paris supported
long-term credits for the USSR
and was violating the spirit
if not the legal provisions of
the Bern agreement.
Paris ap-
pears to be favoring more flexi-
bility on credit terms, however,
in preparation for trade pact
talks with the USSR later this
year.
Bonn's aversion to credits
for the USSR has led Moscow to
work chiefly through busiress-
men. The German Government
still has not guaranteed credits
to Moscow. The USSR has sought
reaffirmation of an Italian
line of credit, but domestic
economic problems limit Italy's
ability to provide any credits.
In Japan, the USSR ha=
worked through private corpo-
rations--making contracts con-
tingent on adequate Japanese
credit--and has generated pres-
sure on Tokyo to consider ex-
tending credits beyond five
years.
Willingness to provide
loan insurance, however, pro-
vides only a steppingstone to
other Soviet demands. With the
British, whose government is
willing to guarantee 15-year
credits, the USSR currently
haggles over the interest rate,
which in order to attract lend-
ers, exceeds six percent.
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A recent decree calls for
a one-year reduction in the
present 11-year system of pri-
mary and secondary education
in the USSR. The change will
bring more than half a million
additional graduates into the
labor force during 1965-66.
The decree is a retreat
to the ten-year system which
existed before Khrushchev's
1958 school reform, a key
provision of which introduced
a three-year period of voca-
tional training into Soviet
secondary schools. A year will
now be removed from this period,
and the remaining two years
will probably involve less
practical training time at the
factories. The transition to
this new schedule is to be com-
pleted by 1 September 1966.
Vocational training was
introduced into the curriculum
at a, time when the USSR was
suffering from juvenile unem-
ployment. Graduates unable to
squeeze into the few available
places at higher schools were
unqualified to work in factories
or offices. Khrushchev stated
in the spring of 1958 that the
Soviet school is not "suited
to offer practical education"
or to prepare youth for useful
labor. "The time has coin to
reshape radically the entire
system of education...."
Last week's decree, along
with a similar one in June,
which eliminated practical_
training in colleges and univer-
sities, should increase effi-
ciency in many factories where
training had interfered with
production processes and often
disrupted schedules.
The decree will put the
growth of the labor force back
on its planned target. The
1964 mid-year economic report
indicated that the growth of
the labor force was lagging be-
hind 1964-65 goals by 0.4 mil-
lion.
Although the 11-year sys-
tem apparently has failed, other
provisions of Khrushchev's
1958 school reform program have
been successful. Eight-year
compulsory schooling is now
generally in force throughout
the USSR, and promotion of
part-time education has sharply
increased the number of workers
attending evening classes or
taking correspondence course
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CURRENT INTELLIGENCE WEEKLY SUMMARY
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During the past two weeks,
Yugoslavia has attacked the US
with unusual virulence, blaming
Washington for contributing in
varying degrees to the current
crises in Vietnam, Cyprus, and
the Congo. Belgrade apparently
feels that in this way it can
enhance its role as a leader of
the nonaligned states and verify
its identity as a socialist coun-
try.
In the process, it seems
quite willing to jeopardize its
steadily improving relations
with the US. After years of Yu-
goslav-US negotiations, settle-
ments were reached recently on
a Fulbright agreement, claims
of US citizens for property con-
fiscated after World War II, and
Belgrade's pre-war bonded in-
debtedness to US citizens. More-
over, Belgrade only this month
requested 1.2 million tons of
US wheat under PL-480 with full
anticipation of quick approval.
Although Yugoslav officials
have never approved of US actions
in Vietnam and only last month
indicated innate sympathy for the
Viet Cong, initial press reports
of the Tonkin Gulf incidents were
factual. After evaluating the
climate of thought among the non-
aligned countries, however, Tito
himself led the press in casti-
gating the US retaliatory action
as unjustified, and even attrib-
uted the Turkish attacks on Cy-
prus to the Tonkin Gulf events,.
The US position in the Congo is
characterized by Belgrade as in-
terference in Congolese internal
affairs.
Yugoslavia also has become
highly critical of US reactions
to Castroism, and took the oc-
casion of the recent action by
the Organization of American
States against Cuba to criticize
the US for pressuring Latin Amer-
ican countries to intervene in
Cuban affairs. Disapproval of
the US on these and other current
international issues is condi-
tioned by Belgrade's public po-
sition that the US Government is
under domestic political pressure
to adopt "strong-armed" tactics
in its relations with the less-
developed countries.
Belgrade's reaction against
the US is consistent with the
pattern the Yugoslavs have fol-
lowed during the past ten years.
In spite of the economic advan-
tages in maintaining close rela-
tions with the US, socialist Yu-
goslavia can be expected to side
with other socialist countries
and the more radical nonaligned
states against the "capitalist
and imperialist" US in crisis
situations.
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NORTH KOREA ASSESSING FREE WORLD MARKETS
North Korea is stepping up
its commercial contacts with
the Free World. Trade delega-
tions now visiting non-Communist
countries are showing particular
interest in heavy industrial
equipment.
Negotiations with Austria,
however, for $30-$40 million worth
of steel manufacturing equipment
have bogged down for lack of suf-
ficient financial guarantees for
the medium-term credit arrange-
ments.
North Korean trade delega-
tions have recently toured West-
ern Europe, and Pyongyang will
reportedly set up trade missions
in Vienna and Helsinki. Earlier
21 Aug 64
this year, North Korean trade
and "good will" groups toured
Africa and Southeast Asia.
This interest in non-Com-
munist industrial equipment and
products probably results from
a slowdown in Soviet aid. The
USSR, which in the past provided
most of North Korea's industrial
equipment as part of its $700-
million economic aid program,
has apparently reduced assistance
for Pyongyang's 1961-65 plan.
However, North Korea's
ability to finance large-scale
purchases of Western equipment
is limited. It is increasing
exports of iron ore to Japan
this year, but markets for ex-
panded exports of metal prod-
ucts, the country's best poten-
tial source of foreign exchange,
will not be easy to find. Past
trade with the Free World has
been at a low level. Most of
last year's $20-million total
was accounted for by Japan.
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SUKARNO MOVING FURTHER LEFT
Indonesian President Sukarno's I NASAKOM opposes the Indonesian revo-
independence day speech on 17 August
confirmed his accelerated swing to
the left during the last 18 months.
He charted a course in both inter-
national and domestic policy close
to that of the Indonesian Communist
Party.
Sukarno declared that non-
Asians must leave all of Asia, that
South Korea and South Vietnam are
"not yet free," and he announced
that "we condemn as strongly as pos-
sible the American attack on North
Vietnam."
Regarding relations with the
US, he said that he had tried to re-
main friendly despite repeated evi-
dence of US Government hostility
toward Indonesia. He claimed that
it is impossible now for Indonesia
to remain friendly toward the US if
the latter persists in supporting
Malaysia.
On foreign investment, he stat-
ed that "eventually there will be no
imperialist capital operating on In-
donesian soil." British businesses
will be completely taken over by the
government and compensation will de-
pend on London's stand toward the
liquidation of Malaysia.
Speaking of domestic matters,
Sukarno emphasized that the "retool-
ing" of reactionaries would be car-
ried on without letup and at all
levels. He again emphasized his
long-standing concept of NASAKOM--
the fusion of nationalist, reli-
gious, and Communist elements in
Indonesian society and government--
and stated that whoever opposes
lution. He implied support of re-
cent Communist land seizures, saying
that the "unilateral action" of farm-
ers was understandable in view of
the slow implementation of land re-
form. He lavished praise on North
Korean agricultural successes and
spoke of "freeing the productive
power" of Indonesian villages. This
statement possibly points toward a
plan for agricultural collectivism.
Although Sukarno did not indi-
cate any specific moves against US
intersts in the immediate future,
the content of his speech suggests
that the seizure of the USTS li-
brary at Jogjakarta a few days be-
forehand was coordinated w_th Dja-
karta. Other threatened seizures
have not materialized. Further dem-
onstrations against US-owned estates
in North Sumatra have not developed
nor has renewed action agak_nst a US
tire factory in Bogor, West Java.
In both areas, army and police have
taken steps to protect American per-
sons and property.
The Communist Party moved im-
mediately to identify itself with
Sukarno's speech and to prepare to
exploit it in furthering its own
program wherever possible. A spe-
cial statement by party chairman
Aidit on 18 August welcomed the
speech as "fully in line" with the
struggle of the Indonesian and
Southeast Asian peoples "a=- pres-
ent." Aidit has instructed PKI
provincial officials and party mem-
bers to study the speech so that 25X1
it can be used to "guide the Indo-
nesian people in their act:.vities."
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SOUTH VIETNAMESE GOVERNMENT REORGANIZED Asia-Africa.
General Khanh's Military
Revolutionary Council (MRC) has
formally tightened its hold on
South Vietnam's political life.
On 16 August, it promulgated a
provisional constitution which
reorganized the government into
separate executive, legislative,
and judicial branches. The
executive branch is clearly the
strongest of the three. The
MRC is the appointing authority
for the 150 members of the pro-
visional legislative assembly
(100 civilians and 50 military)
and the supreme judicial council
which will select judges subject
to approval of the president.
General Khanh is now pres-
ident of the republic as well
as chairman of the MRC. These
two positions give him wide
powers, but he must act with
the approval of the MRC. Gen-
eral Minh, former chief of state
and opponent of Khanh, has no
official position in the gov-
ernment, although he has been
retained as an "adviser" to
the MRC.
There has been no clearly
defined public reaction to the
decrees. About 500 students
demonstrated in Hue, where a
proclamation was read calling
on generals to return to the
army and criticizing the frequent
changes of government. In
anticipation of the 20-21 August
anniversary of Diem's raids on
their pagodas, Buddhist leaders
published communiqu4s which
denounced recent "anti-Buddhist
acts" in Central Vietnam and
the continuation of religious
prejudice despite the overthrow
of the Diem regime.
Viet Cong military attacks
declined during the week, but
there has been an increase
in harassment and terrorism.
Two large-scale ambushes
occurred in the delta prov-
ince of Phong Dinh, one com-
bined with attacks on two
government posts. A step-up
in military activity can
normally be expected after
the recent three-week lull,
but the Viet Cong may also
be responding to the 10 August
call by the Communist-con-
trolled National Front for
the Liberation of South Viet-
nam for increased activity
in order to take part in "lib-
erating the South and defend-
in the North" from the US
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A tripartite meeting of
the three Laotian factions is
scheduled for 24 August in
Paris. The outcome of these
talks, however, is highly
problematical.
The agenda itself may
prove a sticking point. Pathet
Lao chief Souphannouvong has
stated that "no condition should
be posed which would prevent
a subsequent 14-nation confer-
ence from taking place."
Premier Souvanna, however, is
on record as wanting to discuss
conditions for an international
conference, including Pathet
Lao withdrawal from territory
in the Plaine des Jarres oc-
cupied last May. It is unclear
how flexible Souvanna is on his
conditions.
"true" neutralist representa-
tives be included in the neu-
tralist portion of the Laotian
delegation to a Geneva. confer-
ence. He declared on 16 August
that pro-Communist "genuine"
neutralists should take part
in future negotiations and that
"their opinions must be re -
spected." Souva.nna., however,
is unlikely to accept any in-
fringement on his position as
neutralist leader and spokesman.
The military situation in
Laos has been quiet since the
government's successful offen-
sive in the Phou Koun - Muong
Kassy areas. Government forces
are now engaged in a clearing
operation southwest of Muong
Kassy against Communist troops
who were dislodged from their
positions along Route 13 during
the offensive.
The composition of a
combined Laotian delegation to
a Geneva conference could also
produce an impasse in the talks.
At Paris, Souphannouvong may
insist that Souvanna is now a
representative of the right
wing and has forfeited his claim
to speak for the neutralist
faction at an international
conference. Souphannouvong will
probably at least demand that
The Communists are putting
up heavy antiaircraft fir--
against the continuing T-28 air
strikes. On 13 August a T-28
was shot down over Phou Kost hill,
and on 18 August another T-28
was downed south of Xieng
Khouang. Four Lao T-28s have
now been shot down by enemy 25X1
ground fire since the recent
outbreak of fighting in Laos.
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ASIA-AFRICA (continued) Page
SOUTH VIETNAMESE GOVERNMENT REORGANIZED 9
A new constitution makes the executive branch, with
General Khanh at its head, the strongest in the govern-
ment, although the Military Revolutionary Council retains
general authority. Viet Cong activity has increased
slightly.
TALKS AMONG LAO FACTIONS SCHEDULED
Laotian leaders are to meet in Paris on 24 August, but
there is likely to be sharp disagreement even over the
agenda. There has been a lull in military activity.
AREA NOTE
On Yemen-Aden
AREA NOTE
On Lebanon
INCREASING COMMUNIST ACTIVITY IN MAURITIUS
A rising volume of propaganda and labor and youth agita-
tion, much of it carried on by Chinese Communists, aims
at exploiting racial divisions and economic difficulties
as the island moves toward independence.
DEVELOPMENTS IN THE CONGO
The military situation has taken another turn for the
worse, as a rebel attack has penetrated Bukavu and the
Kwilu rebels are again on the march. Government forces
still have the upper hand in Katanga.
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Yemen-Aden: In Aden, dis-
sident activity against the
British has intensified. The
rebels evidently are receiving
considerable aid and direction
from the Egyptians in Yemen.
The rebels' planning and co-
ordination has improved, and
they are using more sophisti-
cated weapons--light machine
guns, mines and mortars. The
Sultan of the Aden Protectorate
state of Fadhli, who last month
denounced British rule in Iden
and defected to Cairo, is now
in Yemen where the Egyptians
presumably plan to put him ,.n
contact with the Adeni rebels.
He has been joined by other- de-
fectors from Fadhli and co?ald
cause the British considerable
trouble if he leads a dissi-
dent movement in Fadhli.
SECRET
21 Aug 64 CURRENT INTELLIGENCE WEEKLY SUMMARY
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SECRET
Lebanon: The prolonged
uncertainty in Lebanon over
whether President Shihab would
serve a second term was finally
resolved on 18 August with the
nearly unanimous election of
Charles Hilu as the country's
fourth president.
The balloting by Parliament
took place without incident, and
prospects for a peaceful transi-
tion appear good. If trouble
is avoided, it will be the first
time in Lebanon's brief history
that a new president has taken
office without turmoil among
the country's mixed Christian
and Muslim population. Hilu
will start his six-year term on
23 September.
The 51-year-old Hilu
was chosen because he was not
strongly opposed by any of the
parties concerned. His qualifi-
cations otherwise are not out-
standing, despite his lengthy
experience as a cabinet member,
government official and diplo-
mat. In Lebanon, however, a
controversial personality gen-
erally seems less effective as
a president than a moderate man
who can remain neutral amid the
maneuvering of the numerous reli-
gious and political groups.
Whether Hilu can maintain tie re-
quired balance is open to q=ies-
tion. He presently has the nec-
essary support of the Muslim com-
munity, strongly suggesting that
he also is acceptable to Nair,
a powerful influence among `ieb-
anese Muslims. In addition,
Hilu evidently had Shihab's sup-
port, indicating that restless
elements in the army are reason-
ably satisfied with the choice.
Christian leaders such
former President Shamun and
as
the
Maronite Catholic patriarch are
probably the least enthusiastic
group. Their satisfaction with
Hilu will depend on how well they
believe he is protecting Chris-
tian interests against the "in-
roads" of Muslim and pro-Nasir
elements.
Hilu, a Christian as re-
quired by Lebanese presidential
tradition, is pro-Western and,
like many Lebanese, a Francophile.
A French-educated lawyer, he also
was a journalist before entering
government service.
INCREASING COMMUNIST ACTIVITY IN MAURITIUS
Communist activity in the
largely self-governing British
Indian Ocean colony of Mauritius
has recently been diversified
and stepped up. The Communists,
particularly the Chinese, prob-
ably hope to exploit the deep
racial tensions and growing un-
employment after the islanc at-
tains independence, possibjy in
the next year or two.
With nearly 700,000 people
for its 720 square miles, Mauri-
tius is one of the most densely
populated agricultural areas of
SECRET
21 Aug 64 CURRENT INTELLIGENCE WEEKLY SUMMARY
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SYRIA ? \~
LIZ ',B.. /
.?~( /{ IRAQ
I I
JORDAN
1
;a1' KUWAIT
BAHRAIN
QATAR
(Jr
YEMEN PFi P'B`A
J OVZN
e R SOMALILAND
UGANDA
KENYA
/
REPUBLIC
.t
PAK
MAURITIUS
erpent
Island -
Flat Round
1shndt,
Island
TA NGAIYI KA
AND
ZANZIBAR
j MALAWI
1\. j
MOZAMBIQUE
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.SECRET
70 scholarships to Lumumb i Uni-
versity. About 25 students from
Mauritius are in Moscow now
while 25X1
there are at least 200 Ma.uritians
studying in China and some in
East Germany. Two recently de-
parted for Cuba. There is also
considerable movement of Chinese
families, businessmen, and tour-
I to and from Communist China.
Cheap propaganda literature About 20 percent of the island's
--in French, English, and Chi- Chinese community of 25,000 are
nese---is being distributed in suspected of actively supporting
increasing volume through a well- Peiping.
organized network,
the world. Seventy percent of
this population consists of
Hindu and Muslim laborers who
are hated and feared by the
white oligarchy of French des-
cent which controls the sugar
industry, and by some 200,000
Africans. The latter community
dominates the civil service.
More than half the popu-
lation is under 20 years of age,
and is the obvious target of
this propaganda. It is from
their ranks, which include the
restive, semieducated Indian
and Chinese youth who are unable
to find the white-collar jobs
they think they deserve, that
the next generation of political
leaders will come.
Communist agitators, more-
over,have begun to incite the
poverty-stricken Hindu agricul-
tural workers into nuisance
strikes. The Hindus harvest the
sugar cane which covers 93 per-
cent of the cultivated land and
accounts for 98 percent of the
island's exports. The leader
of the agricultural workers is
a notorious Communist.
The present administration
of Chief Minister Ramgoolam, an
Indian, will lead the island to
independence. Although Ramgoo-
lam is regarded
as responsible and reasonable,
he has neutralist tendenc:es
and Communist friends, includ-
ing the leader of the agrcul-
tural workers.
Communist youth associa-
tions are expanding their opera-
tions, and the USSR is offering
SECRET
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c ~u_ eaooN
REPUBLIC
OF '! HE
CONGO
CENTRAL AFRICAN REPUBLIC SUDAN
! ?`..,J'"~.J
l-F3ANGS J y,' -.
,
L OPOL4VaLLE
1 .Xenae
ca KIGALr
'BUJUMBURA
Kolwexi
. _ _i ~~Elisal
NORTHERN RHC)DES1A
(I, .)
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SECRET
The military situation in
the Congo has taken a sharp turn
for the worse. Government gains
in the south have been offset by
the apparent rebel capture of
Bukavu, on the Rwanda border,
and the resurgence of the rebel-
lion in Kwilu.
As of 20 August, parts of
Bukavu were still in government
hands, but the fall of the city
appeared imminent. Many of the
rebels are Tutsi refugees from
Rwanda. Some of the 60,000
Tutsis in the province have long
been associated with the rebel-
lion and many more apparently
joined the rebels after Premier
Tshombe ordered their expulsion
from the Congo on 18 August.
Rwanda has been preparing for a
Tutsi attack and, if Bukavu
should fall completely, an inva-
sion almost certainly will occur.
In Kwilu, some 8,000 rebels
are converging on Kikwit, the
provincial capital, about 225
miles east of Leopoldville. Only
one battalion of government
troops is available in Kwilu, and
it is doubtful that they can stop
the insurgents. Other rebel
bands are still advancing toward
Luluabourg from the east.
strengthening their hold on ttie
city through psychological and
military pressures, and "popular
measures" including the forced
sale of beer at low prices.
Congo Army forces are regrouping
down river at the town of Bun:ba.
At the same time, howeier,
there is increasing evidence that
the rebel leadership in the east-
ern Congo is beginning to frag-
ment. Rebel leader Soumialct's
military chief, "General" Olenga,
who more than anyone else was
responsible for the rebels' cap-
ture of Stanleyville, has been
issuing a series of manifestos
and pronouncements--all of which
omitted mention of Soumialot's
name. This may indicate Olenga
is trying to usurp rebel leader-
ship.
In Katanga, government forces
continue to have the upper hand.
A government column, accompzRnied
by three Belgian officers, has
captured the rail center of Ka-
balo, due west of Albertville.
News of the capture might induce
already frightened rebels to flee
Albertville, the former se.---t of
Soumialot's "Provisional Govern-
ment of the Eastern Congo."
SECRET
21 Aug 64 CURRENT INTELLIGENCE WEEKLY SUMMARY
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 Approved For Release 2008/06/24: CIA-RDP79-00927AO04600010001-2
ANC forces. Five US-supplied
B-26 bombers arrived in the
Congo this week to join the small
government force of T-28s and
T-6s.
Premier Tshombd's anti-
rebel plans are beginning to
take form.
Addi-
tional Belgian military "tech-
nicians" apparently will be sent
unofficially and may be com-
mitted in small numbers to stiffen
SECRET
Already strained relateons
between the two Congos continue
to deteriorate, exacerbated by
polemics between Brazzaville of-
ficials and Tshombd. An offi-
cial Brazzaville communiqud
called Tshombd an "assassin in
power" and said disorder was in-
stitutionalized in Leopoldville.
SECRET
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NWO, 140
SECRET
New difficulties over
amending the draft constitution
and the problem of NATO rela-
tionship may impede Malta's
independence now scheduled for
21 September. The Colonial
Office in London will not an-
nounce the Maltese independ-
ence date until the Borg-Olivier
government agrees to amend the
new constitution to meet Brit-
ish objections.
Specifically, London seeks
to eliminate the discrimination
against non-Catholics in per-
sonal religious matters--in-
cluding marriage, divorce, and
burial--now embodied in the
new constitution proposed for
Malta. London has been press-
ing the Maltese Government to
agree to this and has the full
support of the apostolic dele-
gate in London and of the
Maltese church. Although
Prime Minister Borg-Olivier
was initially willing to comply
with London's request, the
Colonial Office now reports a
"general reluctance" among
Maltese politicians to make
the necessary changes. The
matter could be politically em-
barrassing to the Douglas-dome
government in this pre-ele--vion
period if the Maltese persist
in their attitude.
With respect to Malta's
postindependence relationship
with NATO, Borg-Olivier has been
pressing hard for full membership
in the alliance. NATO, however,
is apparently reluctant to ac-
cept this, and the British con-
sider it impracticable. They
point out that Malta could handle
only a limited role, and is far
from being economically and
politically stable.
NATO members generally
agreed at their special 12 Au-
gust meeting that there should
be a permanent agreement linking
Malta with NATO, but there was
no unanimity on the form tii.s
should have. Rome is sounding
out NATO countries on the )ossi-
bility of transferring the NATO
Command Head uarters on Malta
to Naples.
SE, CRET
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25
MILES
Fe A 1. VAFAliAGUA
Port-de- P a i x
R CY :O L E
Ili,! a S
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A I QNI E t-
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SECRET
HAITIAN GOVERNMENT'S ANTI-REBEL ACTIONS STILL INEFFECTIVE
The Haitian Government has
still not taken effective action
against the two rebel groups op-
erating in the southern part of
the country.
One rebel group near the
Dominican border has success-
fully surprised government forces
on several occasions and caused
some 20 casualties. These rebels
have also attacked several towns,
burning small army quarters in
the process.
The other rebel group is
operating in the Jeremie - Port-
a-Piment area and apparently
still. evades and confuses Duva-
lier's forces.
In an apparent effort to
cover up its military failures,
the government has displayed a
mutilated body in Port-au-Prince
--allegedly that of the leader
of the Jeremie group. There is
no evidence to support this
claim or the assertion that sev-
eral other members of the Jere-
mie band have been killed by
government forces.
An arms purchasing mission
left Port-au-Prince last week
for Panama and Nicaragua.F_
21 Aug 64
In Port-au-Prince, Presi-
dent Duvalier continues his re-
pressive measures. He has, for
example, ordered the arrest of
entire families in the Jeremie
area as hostages for relatives
alleged to be among the rebel
invaders. Such punitive actions
cow the populace and help deter
any possible impulse to rise
against the government.
Duvalier's grip on the
country therefore remains strong,
and unless new and larger scale
rebel landings take place. the
government will probably c-=ver-
come the small bands presently
active. The financial burden
of fighting them, however, is
relatively heavy. This factor,
plus the regime's lack of com-
plete support from its troops,
army and militia, will tend to
slow the process of pacification.
On the international front,
Haiti is preparing to fill a
complaint against the Domrican
Republic before the UN Security
Council for allowing exiles to
cross its borders.
SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY Pate 18
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SECRET
THE DOMINICAN REPUBLIC'S AUSTERITY PROGRAM
The provisional government
of the Dominican Republic is
attempting to win support for
the second phase of its auster-
ity and exchange stabilization
program. To acquaint the public
with the gravity of the advanc-
ing economic crisis, Triumvi-
rate President Donald Reid
Cabral has delivered a. series
of television a.nd radio speeches
explaining his corrective pro-
gram.
During 1964 a sharp rise
in imports and foreign debt re-
payments has coincided with
a drop in the price of sugar--
the principal Dominican export.
The resulting balance of pay-
ments deficit seriously threat-
ens the convertibility of the
peso. Arrears in foreign com-
mercial accounts currently
total about $60 million. About
one third of the labor force
is unemployed, and more will be
as the slack season in the sugar
industry approaches. Political
instability, moreover, has dis-
couraged private investment and
promoted a sizable capital
flight.
The first phase of the
austerity program in April and
May, involving increased customs
duties on consumer goods, failed
Western Hemisrnere
to reduce these imports appre-
ciably. Reid has now announced
three new taxes designed to re-
duce imports and provide finds
for an intensive program t in-
crease agricultural production.
Agreements have been reached
with the International Monetary
Fund, a group of New York tanks,
and the US Government, for an
estimated $55 million in medium-
term loans and grants. Reid
has also promised to reduce
nonproductive government x-
penditures and improve customs
collections.
The public at large, n-
cluding the military, appeAr
to recognize the necessity for
the program, but criticism is
centering around one measure,
that of increasing social -se-
curity contributions. On 7
August the labor arm of th