WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A004900130001-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 37
• Document Creation Date: December 21, 2016
• Document Release Date: May 29, 2008
• Sequence Number: 1
• Publication Date: July 30, 1965
• Content Type: SUMMARY

CENTRAL INTELLIGENCE, AGENCY
OFFICE OF CURRENT INTELLIGENCE
downgrading and declassification
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 25X1 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
(Information as of noon EDT, 29 July 1965)
VIETNAM
The surface-to-air missile sites in North Vietnam are
now operational. The two most recently discovered
sites in the area where a US fighter was shot down
last week were reported 20 percent destroyed by a US
strike on 27 July. Vietnamese Communist propaganda
continues to sharpen the threat of bringing in foreign
volunteers but stops short of admitting that some are
participating in the fighting now. Viet Cong activity
remains in a relative lull for the third week.
NEW SOVIET ICBM FIRINGS TO PACIFIC IMPACT AREA
A 26 July announcement said an area 80 nautical miles
in diameter 4,500 nautical miles from Tyuratam would be
closed to shipping from 28 July to 15 October for tests
of "new types of carrier rockets for space vehicles."
SOVIET ECONOMIC STATISTICS FOR MIDYEAR
An apparent improvement in the Soviet economy since
last year's midyear figures were announced is largely
the result of the recovery of the food industry follow-
ing the exceptional harvest of 1964.
Page
THE RUMANIAN PARTY CONGRESS
Except for statements by the Soviet and Chinese dele-
gates, Rumania's 19-24 July party congress skirted ideo-
logical issues and concentrated on national affairs. In
addition to reasserting Rumania's independent position
in the Communist world, the proceedings served to enhance
the power of party leader Ceausescu.
SECRET
Page i WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
.. & W V..a
BULGARIAN LEADER'S POSITION WEAK
Moscow will withdraw its
support of Todor Zhivkov's leadership unless he can
improve the country's economic situation and end intra-
party friction before next February's general elections.
YUGOSLAV ECONOMIC REFORM MEASURES ADOPTED
These reforms should have a favorable long-run effect
on the economy, but initially will cause severe diffi-
culties for certain industries and population groups.
NORTH KOREA'S RELATIONS WITH THE BLOC
There are growing signs that Pyongyang is moving back
toward the policy of neutrality it once pursued in the
Sino-Soviet dispute.
Asia-Africa
LULL IN INDONESIAN CONFRONTATION ACTIVITIES AGAINST MALAYSIA 17
All Indonesian military forces near Malaysia have never-
theless remained in a high state of alert, and prepara-
tions for future operations against Malaysia continue.
THE SITUATION IN LAOS
No single faction won a majority in the National Assem-
bly elections, but minor cabinet changes are likely
soon. Government military forces are exerting pressure
on Pathet Lao positions.
DOMESTIC PRESSURES FOR RHODESIAN DECLARATION OF INDEPENDENCE 19
While Prime Minister Smith seems strong enough to with-
stand these pressures, he is continuing to develop close
ties with the other white redoubts of southern Africa in
case a unilateral declaration becomes necessary.
TSHOMB19 AND KASAVUBU MARK TIME IN CONGO FEUD 20
The two leaders apparently are awaiting results of elec-
tions in three provinces next week. In the campaign
against the remaining rebel strongholds, the government's
military position continues to improve.
GREEK CYPRIOTS ACT AGAINST TURKISH POLITICAL RIGHTS 21
The Makarios regime has extended the life of the purely
Greek Cypriot government and eliminated constitutional
safeguards of the Turks' minority position.
SECRET
Page ii WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SEtiu 1
Europe
NO BREAK IN GREEK POLITICAL CRISIS
Premier-designate Athanasiadis-Novas seems to have
little chance of winning a vote of confidence, and a
new compromise figure is being sought to ease the con-
frontation between King Constantine and ousted prime
minister Papandreou.
EEC STALEMATE THREATENS KENNEDY ROUND TRADE NEGOTIATIONS 24
If the EEC crisis causes slippage in the Kennedy Round's
tight negotiating schedule, the US Trade Expansion Act
may expire before the trade talks can be concluded. All
the EEC partners, however, may feel increasing pressure
to resolve the crisis so the EEC will be able to make
the decisions the Kennedy Round requires.
Western Hemisphere
NONALIGNED DOMINICAN GROUPS PRESS FOR EARLY SETTLEMENT 25
Despite business and labor union pressure for a quick
agreement, only minor progress was made this week in
negotiations between the Caamano and Imbert factions.
RECENT SOVIET MILITARY SHIPMENTS TO CUBA 26
Probable arms deliveries by Soviet ships in the past
two months are, like all those since October 1962,
apparently designed chiefly to maintain rather than
increase the level of arms in Cuba.
SECRET
Page iii WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET NOW
CUBAN REVOLUTION TURNING INWARD
Castro's major theme in his 26 July speech was internal
political and administrative affairs, although he again
urged Latin American revolutionaries to follow Cuba's
example.
"NATIONAL CONCILIATION" EFFORT FAILING IN HONDURAS
The resignation of Foreign Minister Ulloa from General
Lopez' regime leaves only one member of the majority
Liberal Party in a cabinet dominated by the minority
Nationalist Party.
28
MEETING OF EIGHTEEN-NATION DISARMAMENT COMMITTEE BEGINS 29
Prospects for productive discussion are dim, however,
because of Western differences over an agreement on non-
proliferation of nuclear arms and apparent Soviet inten-
tions to use the forum merely to attack the US. The
French, although still refusing to participate in the
ENDC meeting, are showing considerable interest in it.
SECRET
Page iv WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET
All seven known surface-to-
air missile (SAM) sites in North
Vietnam are apparently operational.
ground fire. Two others--one
battle damaged and its escort--
were lost in a midair collision
on their return to base.
On 24 July one USAF F4C
fighter flying in a group of four
.was shot down by a SAM 37 miles
west-northwest of Hanoi, well
west of the five sites previously
known. The other three fighters
were damaged, but managed to land
safely.
These planes were attacked
from SAM sites--designated 6 and
7--constructed rapidly
the area show no
signs of construction. Subse-
quent analysis of photographs
however, show both
sites nearing completion. Their
location suggests they are in-
tended as point defense for Phuc
Yen Airfield. They also provide
protection for the important
Hanoi - Lao Cai rail line re-
cently hit by US strikes.
USAF fighter bombers struck
sites 6 and 7 on 27 July. Visual
damage reports indicate that ap-
proximately 20 percent of both
sites was destroyed. They were
described as having napalm burns,
and the radar van at site 7 was
reportedly blackened by napalm.
Nearby support facilities also
were reported on fire. Four
.F-105s were shot down during the
attack by heavy conventional
photography shows that
construction is complete at sites
1 and 2, which also are almost
certainly operational.
Stress on Bloc Aid to DRV
Vietnamese Communist propa-
ganda continued to sharpen the
threat to bring in foreign volun-
teers this week, but stopped
short of an open admission that
some are now participating in 25X1
the fighting. On 25 July, Hanoi
announced that foreign embassies
had agreed to a program of mili-
tary training for "students"
presently in North Vietnam. The
announcement singled out Chinese,
North Korean, Polish, and Indo-
nesian students and highlighted
their statements that the program
would give them an opportunity
to "fight side by side with the
Vietnamese." In South Vietnam,
Liberation Front President Nguyen
Huu Tho claimed in a 20 July
speech that "socialist" coun-
tries "are now ready to support
or are actually supporting us in
all fields including weapons and
volunteers."
The necessity of direct bloc
participation in the Vietnamese
war was also raised by the head
SECRET
Page 1 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
y UL' %_4X%AJ l tiny/
of the North Vietnamese Army,
General Vo Nguyen Giap, writing
in the July issue of the party's
theoretical journal, Hoc Tap.
Giap read into the extent and
nature of the US build-up"in
South Vietnam a possible intent
to launch a ground strike on the
DRV. He warned his people to
make every preparation for such
an attack and implied that the
"whole socialist camp" would then
come to Hanoi''s aid.
The added emphasis on foreign
participation may reflect, in
part, the outcome of the recent
swing through bloc capitals by
DRV Deputy Premier Le Thanh Nghi.
During-his six-week junket, Nghi
negotiated new aid agreements
with practically all the bloc
states.
series have been produced--
enough to reequip the bulk of
the main Viet Cong combatant
force.
The Chinese are apparently
manufacturing arms for the Viet
Cong in special lots
At least 33,-000 car-
bines, 18,000 assault rifles, and
2,000 light machines guns in this
Page 3
The Fighting in the South
Viet Cong activity con-
tinued in a relative lull for
the third consecutive week, fall-
ing for the most part into the
usual patterns of terrorism,
harassment of isolated posts,
and interdiction of lines of
communication. The Communists,
however, may be regrouping
forces for further large-scale
attacks. Recent sighting'. reports
SECRET
30?`July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
w 1w
Tien-yang
~? -}-?r ~-` ;Lao Cai LA.
N T14
Phang~ V/E -Ah
Saly son La.. Phuc Yen
T H A I L A N D
q' Pakse
A 1&B O D11 A `VigTNA
k j} / ',/Da Lat
5th i ion
PHUOC
-.-
LONG
25th9i Yli
CStvision~ r?~ r
CAPITAL LONG/ 8INI
MILITARY REGION
uB1en Hoa
~...;: 1--JIAu w 4ANh ' i tl r1
a iNGHIA lT'1iR f
'PiiiU- 30thDivision
? III CORPS
K'E", 'Run Sat.Special Zone (VNN)
y,? . e P C
d rt Bayard
tQUANG
TRI
VIS
Hai-k~Ou
on
THUA
THIEN
FF'~Da Nang
UUANG NAM
2n
The Indochina - South China Area
s-_ South Vietnamese military
boundaries
DINH
PLEMU~ 2 nd Divj Non
PHU
I3^N
')ARLAC
t 23r4 Division'
DUC JANG' TUYEN
iDllC S NIN4
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
w JlL ULCL'i l VA+
indicate the presence of possibly
three Viet Cong regiments within
24 miles of the US Marine instal-
lation'at Chu Lai. Other reports
suggest possible build-ups of
Viet'Cong forces near the Hau
Nghia - Long An Province border
area in the III Corps zone, and
in Dinh Tuong Province in the
IV Corps zone.
Government-initiated ground
operations showed little varia-
tion in number, but for the
first time since March, the
weapons loss ratio favored the
government. Friendly air sup-
port continued to account for a
large percentage of Viet Cong
casualties, with Vietnamese and
US fixed-wing aircraft recently
averaging more than 385 strike
sorties per day despite uneven
weather conditions. Coastal
bombardment by US Navy warships
reached a new high during the
week, and was directed at more
than 100 targets in all four
corps zones. US ground troops
engaged in little large-scale
activity, being deployed mainly
in defensive positions around
the major bases at Bien Hoa, Da
Nang, and Chu Lai. The major
engagement of the week took
place on 25 July when US marines,
in a joint amphibious search-
and-destroy operation with Viet-
namese forces, killed 25 Viet
Cong and captured 33 on a small
island seven miles north of Chu
Lai.
South Vietnamese Politics
F no open
opposition to the Saigon regime
has developed thus far. Prior
warnings by both Chief of
State Thieu and Premier Ky
against troublemaking were
formalized in a government de-
cree issued last week, provid-
.ing stiff penalties for graft,
economic profiteering, or
sympathy for Communism or neu-
tralism.
In the central highlands,
representatives of the tribal
autonomy movement FULRO have of-
fered to cooperate with the gov-
ernment against the Viet Cong
in return for government sup-
plies and support and the right
to fly their own flag. Formed
after the September 1964 re-
volt in five tribal paramilitary
camps, the FULRO group now is
reported to be based across the
border in Cambodia. Vietnamese
officials are considering the
FULRO offer, lest these elements
turn increasingly to the Viet
Cong for support.
SECRET
Page 5 WEEKLY SUMIARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
SECRET
NEW SOVIET ICBM FIRINGS TO PACIFIC IMPACT AREA
The USSR's announcement on
26 July of the forthcoming tests
of "new types of carrier rockets
for space vehicles" heralds its
eleventh series of extended-
range ICBM tests into the Pa-
cific Ocean.
According to the announce-
ment, a circular impact area
measuring 80 nautical miles in
diameter will be closed to ship-
ping and aircraft for 12 hours
daily from 28 July to 15 October.
This area is about 4,500 nauti-
cal miles from the Tyuratam
rangehead.
Soviet instrumentation
ships are on station to monitor
the forthcoming firings./
SECRET
Page 6 WEEKLY SUMMARY 30 July 65
25X1
25X1
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 25X1 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
*me
SECRET
SOVIET ECONOMIC STATISTICS FOR MIDYEAR
According to official fig-
ures, the Soviet economy is in
slightly better shape now than
at midyear 1964. The improve-
ment is largely a result of the
recovery of the food industry,
in consequence of the exceptional
harvest of 1964, from its low
point after the very poor har-
vest of 1963.
Investment appears to have
increased, reversing the down-
ward trend of the past few years.
The limited data released, how-
ever, are not sufficient to de-
termine whether this increase
will produce a commensurate rise
in total investment for the year.
Growth in output in the
major heavy industrial sectors
either declined somewhat or re-
mained at the midyear rates of
1964. Food and light industrial
production rose 10 percent as
compared with only 2 percent last
year.
The chemical industry still
enjoys a reasonably high prior-
ity, and so far the apparent re-
duction in some of the long-term
goals since Khrushchev's ouster
has had little or no effect on
production. The six-month in-
crease of 14 percent in chemical
output makes attainment of the
1965 goal feasible, but commis-
sioning of some new capacities
is running behind schedule.
Growth in the important
area of fuels and power is on
schedule as are increases in
metals and machine-building. The
growth planned for machine-,build-
ing was small and has been slow-
ing since 1960.
Brezhnev's new program has
yet to be greatly felt in agri-
cultural production. Growth in
investment was high but lower
than in the first half of 1964.
A record area was sown to wheat,
but continued poor weather leaves
the size of the harvest in doubt.
Record procurements of meat,
milk, and eggs reflect both a
good feed supply from 1964 and
the increase in procurement
prices decreed by the new Soviet
Government. In spite of the
priority assigned to agriculture,
there was no significant change
in the general supply of agri-
cultural equipment.
The construction industry
continues to be plagued with
protracted delays in completing
projects, and shows no improve-
ment over last year. The rate
of growth in housing construc-
tion was better than in recent
years, but progress remains in-
sufficient to meet Soviet needs.
The semiannual goal for completion
of housing units fell short of
fulfillment.
Consumer welfare in other
areas has improved since last
year. Incomes of state employees
increased 6 percent and money
payments to collective farmers
rose 10 percent. Retail trade
turnover grew, but apparently
not as much as income, result-
ing in an increase in savings
deposits substantially higher
than in recent years. This sug-
gests that the purchasing power of
the population is increasing
faster than the supply of salable
goods.
SECRET
Page 8
WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
1 v
SOVIET-ANNOUNCED FIGURES ON PLAN FULFILLMENT, 1964-65
(Percent of Change From Correspondinq Period of Previous Year)
1964
1965
1st 6 Mos.
Full Year
1st 6 Mos.
Full Year
(Plan)
Industrial Materials
Electric Power
11
12
10
11
Coal
4
4
5
1
Crude Petroleum
10
9
8
8
Gas
20
20
17
17
Mineral Fertilizers
23
28
26
31
Plastics and Resins
27
22
16
28
Cement
3
6
10
7
Commercial Timber
4
3
-1
**
Civilian Machinery
Chemical Equipment
15
19
17
22
Oil Equipment
7
22
14
**
Agricultural Equipment
6
1
3
8
Consumer Goods
Television Sets
19
18
20
28
Washing Machines
27
25
20
23
Refrigerators
20
25
38
64
Fabrics
5
5
2
3
Leather Footwear
3
3
2
Meat (State Slaughter)
-18
-23
33
12
Housing
3
-5
8
15
Labor Productivity in Industry
4
4
5
6
State Plan Investment
5
8
10
11
(about 75% of total)
* Soviet figures are generally 2 to 3 percentage points higher than
CIA and other Western estimates.
** Not Available
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
W
SECRET
THE RUMANIAN PARTY CONGRESS
The Rumanian party congress
from 19 to 24 July reasserted
the regime's determination to
hold to an independent course in
domestic and bloc affairs, and
professed solidarity with the
world Communist movement. De-
velopments there also attest to
the political power of party
general secretary Ceausescu,
who emerged from the proceedings
as the undisputed "first among
equals," supported by an inner
group of leaders personally in-
debted to him.
The attendance of delega-
tions from all 13 ruling Com-
munist parties and from 43 other
national Communist parties con-
stituted an implicit endorsement
of the new Rumanian party pro-
gram. Except for statements by
the Soviet and Chinese delegates,
the congress successfully skirted
ideological issues upon which
some of the foreign delegations
are in disagreement and focused
on Rumanian national issues and
party matters.
As a result of some of the
organizational changes approved
by the congress, the structure
of the Rumanian party now re-
sembles Yugoslavia's in certain
important aspects. It now has
an executive committee, composed
of 15 full and 10 alternate mem-
bers, which seems designed to
ensure control by the party
leadership--particularly in the
economic sector--between party
plenums.
Other structural changes
enhance the power of Ceausescu,
who now is party general secre-
tary as well as chairman of the
executive committee and of an-
other newly created body, the
seven-member permanent presidium.
The latter group, which replaces
the old politburo, is expected
to be the locus of power. In
addition, the membership of the
central committee was increased
from 110 to 196, and that of the
party secretariat from 5 to 9.
By a judicious shuffling of
personnel and new appointments
in all of these bodies,
Ceausescu was able to staff
them largely with his own sup-
porters, thus ensuring a stable,
united leadership.
Statements from Soviet and
Chinese representatives at the
congress indicated that Sino-
Soviet rivalry continues un-
abated.
there is no good evidence that
Soviet party leader Brezhnev
and China's Teng Hsiao-ping
held bilateral talks. In his
address to the congress,
Brezhnev pressed for bloc
unity on Vietnam, and under-
scored Moscow's intention to
continue its "principled"
contest with Peiping by build-
ing a record of firm opposition
to "US imperialism" in Vietnam.
Teng Hsiao-ping repeated China's
familiar positions in the Sino-
Soviet dispute, asserting that
the Chinese party would continue
its fight against "modern re-
visionism" and work toward
"ideological urit
SECRET
Page 10, WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
w
NMI,
RUMANIA: CHANGES IN LEADING PARTY BODIES
AT NINTH PARTY CONGRESS-JULY 1965
BEFORE TH,E_ CONGRESS
Ceausescu, N.
Maurer, I. G.
Apostol,G.
Stoica, C.
Bodnaras; E.
Bari I a, P.
Draghici, A.
Moghioros, A.
Birladeanu, A.
Coliu,
Rautu, L.
Salajan, L.
Voitec, S.
Ceausescu, N., 1st Sec.
Dalea, M.
Stoics, C.
Rautu, L.
Niculescu-Mizil, P.
Verdet, 1.
AFTER THE CONGRESS
Ceausescu, N., Chrm.
Maurer, 1. G.
Apostol, G.
Stoica, C.
Bodnaras, E.
Draghici, A.
Birladeanu, A.
Ceausescu, N., Chrm.
Maurer, I. G.
Apostol, G.
Stoics, C.
Bodnaras, E.
Borila, P.
Draghici, A.
Moghioros, A.
Birladeanu, A.
Radulescu, G.
Dragon, C.
Rautu, L.
Solaian,
Voitec, S.
Ni cu l escu-Mi zi l
Ceausescu, N., Gen. Sec.
Dalea, M.
Rautu, L.
Niculescu-Mizil,
Draghici, A.
Moghioros, A.
Partilinet, V.
Manescu, M.
Trofin, V.
Mamas in BLUE, are essentially new personalities on the
Banc, 1.
Berghianu, M.
Blajovici, P.
Coliu, D.
Danalache, F
Fazekos, 1.
there, M.
Lupu, P.
Verdet, I.
Vilcu, V.
25X1
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
"' SECRET
Bulgaria's party first sec-
retary and premier, Todor
Zhivkov, may lose Soviet back-
ing unless he can improve his
country's economic situation
and reduce intraparty friction
in the next six months. Zhiv-
kov has long based his leader-
ship on Moscow's support, and
could not hope to continue as
top leader without it.
Zhivkov probably reflected
his own concern over his con-
tinued tenure in a recent inter-
view with Austrian journalists.
In answer to a question about
possible leadership changes,
Zhivkov replied that "at least
until the February 1966 elec-
tions, no changes are to be
expected." The weakness of his
position was also suggested by
the presence of Academy of
Sciences economist Mateev in the
delegation which Zhivkov led to
Rumania's 19-24 July party con-
gress. Mateev has been publicly
identified by Zhivkov as an op-
ponent of the economic experi-
mentation now being carried out
in Bulgaria.
The Bulgarian economy could
hardly show much improvement in
six months. As for the polit-
ical friction, Zhivkov has
never succeeded in consolidating
his position within the party
since the eighth party congress
in 1962, and has remained in
his post only because he has
successfully gone to the central
committee when outvoted in the
politburo.
While dark horses cannot
be ruled out, leading candi-
dates to replace Zhivkov in-
clude party secretary Mitko
Grigorov for party first sec-
retary, and state President
Georgi Traykov or politburo
member Zhivko Zhivkov for pre-
mier. Another possibility for
party first secretary, Boris
Velchev, may be unavailable be-
cause of a serious illness.
25X1
SECRET
Page 12 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
Naw SECRET `'
After long debate, the Yu-
goslav Government announced on
23 July a series of reform meas-
ures affecting foreign trade
and the structure of domestic
prices. These reforms should
have a favorable long-run effect
on the economy, but initially
will cause severe difficulties
for certain industries and pop-
ulation groups.
Effective 26 July 1965, the
Yugoslav dinar was devalued from
750 to 1,250 to the US dollar.
This will increase both the
costs in dinars for imports and
proceeds in dinars from exports,
even though the increases will
be partially offset by cuts in
import tariffs and export sub-
sidies. This move, which has
been under consideration for a
year, is intended to reduce the
country's growing foreign trade
deficit and allow some reduction
in foreign trade controls.
On 1 January 1966, a new
currency will be introduced at
the rate of one new dinar to
100 old dinars. The rate of
exchange will then be 12.5 dinars
per US dollar,- unless Yugoslav
authorities meanwhile decide
that further devaluation is re-
quired by price increases.
The government also plans
large increases in the prices
of certain products which have
hitherto been kept abnormally
low. This will allow reduction
of extensive government sub-
sidies of certain industries and
together with the devaluation,
will bring Yugoslav prices more
in line with world market prices.
Prices are to double or triple
for major raw materials, and
are to rise 20-40 percent for cer-
tain unspecified processed materials,
electric power, and basic agricul-
tural products. Local authorities
are to supervise a substantial
increase in retail prices of
foodstuffs. Price controls,
which were extended to cover most
of the economy last March, will
be lifted for retail prices of
industrial consumer goods. Such
prices will in general be allowed
to fluctuate freely in the next
few months.
Although the government has
recommended that enterprises in-
crease workers' salaries by up
to 25 percent, not all,will be
able to comply. As a result,
the minimum 20-percent rise in
the cost of living expected by
the government will cause hard-
ship for many families.
Yugoslavia has sought fi-
nancial assistance from various
foreign sources for the reform
program. The International
Monetary Fund has agreed to-pro-
vide a credit of $80 million,
and the USSR has rescheduled
payment on an old credit to
Yugoslavia. Negotiations are
continuing with the US and
several West European countries
for new credits, postponement of
heavy debt payments coming due
in the next few years, and
other means of assistance.
SE CRE T
Page 13 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
`"' SECRET
North Korea appears to be
joining the growing group of
Communist countries which rec-
ognize that true national in-
dependence can be achieved only
if they avoid leaning too far
to either side in the Sino-
Soviet dispute.
In the early stages of the
dispute, Pyongyang pursued a
policy of neutrality. In late
1962, however, recoiling from
Khrushchev's heavy-handed pres-
sure, the North Koreans began
stressing national self-suf-
ficiency but also supporting
some of Peiping's anti-Soviet
words and actions.
Indications of a shift in
this attitude appeared after the
replacement of Khrushchev last
fall. Like all the other Com-
munist regimes--including the
Chinese--North Korea adopted a
wait-and-see attitude toward the
new Soviet leaders. Unlike
China and Albania, which soon
returned to the attack, Pyong-
yang has apparently found
enough change in the Soviet at-
titude to warrant a new look
at its own relations with Mos-
cow.
not reiterated positions they
held before Khrushchev's re-
placement, although develop-
ments since then have given
them opportunities to echo the
Chinese line. For example,
they allowed the Soviet-spon-
sored meeting of Communist par-
ties on 1 March to pass with-
out comment, in contrast to
their violent condemnation last
summer of Khrushchev's plans to
hold such a meeting. They did
not challenge Moscow's right to
participate in the abortive Af-
ro-Asian Conference despite the
adamant stand taken by Peiping
on this question.
Another indication of North
Korea's change of attitude was
its treatment of the anniversary
celebrations of its "friendship"
treaties with the USSR and China.
The Soviet ambassador's banquet
for the occasion, which the Ko-
reans boycotted in 1964, was at-
tended this year by three polit-
buro members whereas only two
such officials--one less than
in 1964--went to the dinner at
the Chinese Embassy. Moreover,
the Koreans' anniversary speeches
did not, as last year, cite re-
visionism as the "main danger"
to the socialist camp.
In evidence of their new
policy, the North Koreans have
A major factor inducing
Pyongyang's shift appears to
SE CRE T
Page 14 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
`0' SECRET `",
have been Soviet Premier Kosy-
gin's visit in February and his
reported offer of new Soviet
economic and military aid. On
27 May, TASS announced that a
military delegation led by the
North Korean chief of staff had
concluded an agreement in Mos-
cow to strengthen North Korea's
defense.
The trend thus far is to
the middle of the spectrum, not
into the Soviet camp. Pyong-
yang has itself not yet pub-
lished the Soviet military
agreement. In a mhjor speech
in April, Premier Kim Il-sung
empahsized North Korea's in-
tention to choose its own ap-
proach to bloc problems and
made it clear that he would
not tolerate a renewal of the
economic and political dicta-
tion the Soviets once tried
to impose.
SECRET
Page 15 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
NN WO` SECRET `"W
A four-week lull in Indo-
nesian confrontation activities
against both peninsular Malaysia
and Malaysian Borneo has followed
the flurry of infiltration ef-
forts timed to coincide with the
aborted Afro-Asian Conference.
All Indonesian military forces
near Malaysia have nevertheless
remained under a high state of
alert since 19 June.
Preparations for future op-
erations against Malaysia are
continuing, and periods of more
intense infiltration activity"
can be expected.
A large Indonesian military
build-up around the periphery of
Malaysia is now in its last
stage.
Although
this build-up has improved Indo-
nesia's capability for large-
scale offensive action against
Malaysia, open warfare war is
unlikely in the near future.
The troops involved in the
build-up have generally been de-
ployed in defensive positions.
The National Assembly elec-
tions held in Laos on 18 July
apparently failed to produce a
clearcut majority for any of
the participating non-Communist
factions. Perhaps the strongest
single grouping, according to
as yet unofficial returns, will
comprise a number of deputies
associated with the young and
moderate minister of finance,
Sisouk na Champassak. Although
this group might press for more
active assembly participation
in governmental affairs, Sisouk
has indicated that for the pres-
ent he will avoid agitating for
any sweeping policy changes.
Premier Souvanna, who re-
turned-to Vientiane this week
from a stay in Europe, will
probably propose some minor
cabinet changes to the King
soon. It appears likely, how-
ever, that the key figures will
be carried over and that he
will try to retain at least
the facade of tripartite rep-
resentation.
Meanhwile, there has been
a step-up in military activity,
as rightist forces attempt to
exert pressure on Pathet Lao
positions. In the north, Gen-
eral Vang Pao's guerrilla units
have joined with regular right-
ist battalions in an effort to
recapture territory between Ban
Ban and Samneua which was lost
to the Pathet Lao last winter.
SE CRE T
Page 17
WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 101 Ip Cl,ial1 1 02 Ko Chiu 1
l
04 10
6 O8
tzu
/~
Mu
,..+ D
B
Dien Ping -kuo
piem Ching-hsi IKuo-tet
\
A
e
a
H 1 N A
~
SSW mao (
Bao Lac*
~
`
ti
-?r
Ha Giang
e e
ao Cal C
Ba
Nua
l t
~
Bac Can
'
/
- /r
m ll?
??
'J.'.
2 Lai Chau !
__
Chi
n in
g
22
ng- ?
o hung
R T H
ang Son
I'I~cpg Saly
Yen B I
Nguyen V?'V,,, /`?,
Bien
en
.Ia ?
' D
en
~
V 1 'N A
~y
h
g
. /
i
~ Son
?
B U R M A M. S uoning \ P
~~ \1 ~y 1 La t
~
g
d~
91 BAN
$
Bac
ian
~
.
/
'K
HANG
rr .
g Hon
^'. }P-
044-YO g
{~~wt
Much
/
Duong
`\ C
1
/ `f '
IOa Binh
OAO CAT HA
\
`
//
Phu Ly
_
Muong Sonx ,~.
,
-
u Sai Samneua
- '
~? / ?I `
.. - ao
h Bi
h
i
?
- Di h
\
i
/ / l I /
n
oN
n
85 ??~ a
ce
Pak
f 2o- Be
MEKONG
j? rabeng
M
ai Thuong
uong You
??
Ban Ban
!~'?
Thanh Ho
(~.?~..,
~ / -
-
~. Muong Q
:.?..:
...
Phou Sour
<
Khoun Plaine des Xieng
\ ?tSayahauryz an Jones ? Khouang `?~~
Th
ie
"1
Phu Qui
' Cua Rao
C IT L F
,
ng ,
.. 7
Ban ? ..
Ta Viang
Van
Ol
ti\., yhu Tru
?
\
g f?- F
g
/
I
Vi
~
?
-
eng
Muang Nan
I
j I 13
I
V ?.
\ AM h
Railroad T t) N K I N
nder reconstruction
Pak S
ne
Kiang
Phrae A-
E T
Bal
Sao ??'\.
_,\1I,.. MUI RON
Due
~
rl uang iChiang
3 Kh n Nong Khai
8 /
13
-_
t
-
i a'
A i I
P
k
oa
Ae d Quang Khe
////
ttaradit
a
o nIn h6mmaratll -?~
8
Udon Thani
Dan Sai
Muang
akhon Phanom 2
Mahaxay
Do g ~
.
Ho
T In
~
Muang Sakon Nak
i
?so.
` '_-`
N
?- Pe a.ceNan tine
?
L
uang Phitsanulok uang T A I L A N D
g N
~ .J D'ottg
Ha
9 oc
gbo Ho
Lom Sak
Mukdaha Sdno
n
! Que
Po Tri
ava nakhet Ban Thay
uong
hme Huey
M
LAOS
e Aa"v tile"
uong
9? / \
SOUTH
;n g
?mow
__
M
Muang
VIETNA
?
Yasothon
Sar vane (
Kh n
S? 0
Ban
16 Thaler,
~
~`
d ~
R
il
m,=u-6M?
ng
a Ubo _ ? r
-?
~ ;s
a
roa
W
i
23
16
ar
n P
saket Chamrap
hue
Road
Chem ssac
3 tittopeti
Surin
--- Track or trail
4 l~
/~ 'Kon9
l8 i 50/
114
l
hon
(?
'? I \
14-
Kha
Bo
rail Miles / C A
, M B 0 D I /A
`
?
25 50 75 100 Kilometers
/ Stung Treng
'
48272 If
,y r~ 171 Reap
102 UNI" $AR ~
uu ran ueo 0UNOA RY ae oa ENTATIM
4 ARE NOT NECEB.A -Y wUT HORITATIVB
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
1%W -WWI
SECRET
Receiving strong air support
from the Laotian Air Force's
T-28s, Vang Pao's units have
met with considerable success
since the beginning of the
drive earlier this month.
Another major rightist
operation is under way in the
extreme south, where several
rightist battalions have
launched a coordinated drive
against pro-Communist positions
along the Se Kong River south-
west of Attopeu near the Cam-
bodian border.
In other areas, only light
activity has been reported.
Rightist units are conducting
a clearing operation along the
Mekong northwest of Sayaboury,
while farther to the north,
pro-Communist forces reportedly
are beefing up their positions
near Muong Sai and Nam Tha.
DOMESTIC PRESSURES FOR RHODESIAN DECLARATION OF INDEPENDENCE
Rhodesian Prime Minister
Ian Smith is coming under con-
siderable pressure from a strong
faction within his Rhodesia
Front party which is impatient
with his policy of seeking a
negotiated independence. from
the UK. These rightist pres-
sures may reach a peak at the
party congress in early August.
While Smith seems strong enough
to withstand them, he is con-
tinuing to develop closer ties
with the other white redoubts
of southern Africa--the Re-
public of South Africa and the
Portuguese territories of
Mozambique and Angola--in case
a unilateral declaration of
independence (UDI) becomes
necessary.
Since Smith first clashed
with the new Labor government
in London last fall, Rhodesia
has signed trade agreements
with South Africa and Portugal,
high-level visits exchanged
among three governments have
been more frequent
With of-
ficial posts already estab-
lished in South Africa and
Mozambique, Salisbury now is
pressing for diplomatic rep-
resentation in Lisbon. Never-
theless, South Africa and
Portugal, both with troubles
of their own, have advised
the Rhodesian Government
against UDI and have refused
to make commitments of mili-
tary or political assistance
in case of a crisis.
Meanwhile, a high UK
Commonwealth official visited
Salisbury this week in an
attempt to keep UK-Rhodesian
negotiations open and possibly
to relieve pressure on both
the UK and Rhodesia for im-
SECRET
Page 19 WEEKLY SUMMARY
30 July 65
25X1
25X1
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET
TSHOMBE AND KASAVUBU MARK TIME IN CONGO FEUD
Premier Tshombd and Presi-
dent Kasavubu apparently are
marking time in their running
feud for political dominance in
the Congo. New moves may come
after election of parliamentary
deputies next week in three prov-
inces where the results of ear-
lier balloting were annulled as
fraudulent. The voting will be
held under the supervision of
Interior Minister Nendaka, whose
appointment by Kasavubu in mid-
July was an especially bitter
pill for Tshombe to swallow.
After these elections, the
two leaders are likely to tangle
over the formation of a new gov-
ernment. Kasavubu probably will
again name Tshombd premier.
Tshombd, for his part, appears
willing to accept an occasional
humiliation in the hope that by
hanging on to the premiership
and its prerogatives he will be
in a strong position to chal-
lenge Kasavubu in presidential
elections expected later this
year.
At the same time, Tshombd
is talking of resigning and is
floating rumors that he might
return to Katanga. He probably
hopes to frighten the President,
and his supporters by suggest-
ing that their alternative to
working with Tshombe in Leo-
poldville is a new secessionist
movement.
In the campaign against
rebel holdouts in the eastern
Congo, the government's over-
all position continues to im-
prove. Government units are
rapidly clearing the vast re-
gion between Kindu, Stanley-
ville, and Bukavu. In the
northeast, small rebel bands
continue to harass mercenary
units but the government still
holds all major towns and is
restoring some of the area's
economy. On the periphery of
the Fizi area west of Lake
Tanganyika, government forces
have again successfully con-
tained insurgent efforts to
expand their control.
SECRET
Page 20 WEEKLY. SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
"MW
SECRET
GREF~K ,CSjJ? ~O ySAr T. APUINS ,TUAKISH POLITICAL RIGHTS
The Greek Cypriots appear
to have launched a concerted
campaign to abrade the political
position of the Turkish Cypriots.
The Makarios regime re-
cently passed two legislative
measures which have drawn strong
protests from both the Turkish
Cypriots and the Turkish Govern-
ment in Ankara. One of these
measures extended the life of
the present purely Greek Cypriot
government for up to 12 months.
The second amended the electoral
law to establish a common elec-
toral list, thereby eliminating
the special minority safeguards
given the Turkish Cypriots under
the constitution. Ankara has
warned President Makarios that he
is "stretching the patience" of
the Turkish Cypriot community
and that the Turkish Government
reserves the right to take "all
necessary measures."
London and Athens have also
protested the new laws. Greek
Foreign Minister Melas told the
British he had sent a sharp warn-
ing to Makarios to the effect that
the Greek Government was against
this type of brinkmanship and
would be unable to support him in
the new electoral procedures pro-
posed. In fact the political cri-
sis in Athens may impede an strong
Greek stand for some time.
SECRET
Page 21 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
SECRET
Europe
No end is yet in sight for I fighting for his political life,
the two-week-old crisis in Greece, insists that if he is not rein-
sparked by King Constantine's stated as prime minister there
ouster of Prime Minister Papan- must be national elections.
Papandreou continues to
seek reinstatement and, with the
aid of his controversial son
Andreas, is trying to create
popular pressure on the King to
bring it about. The Papandreous
have encouraged street demonstra-
tions and have willingly accepted
Communist support in their deter-
mined drive to unseat the new
Athanasiadis-Novas government.
The situation is made to order
for. Communist exploitation, and
Communist agitators, slogans,
tactics, and discipline have
been apparent.
The government has shown
determination and readiness to
maintain order, however, and has
generally kept demonstrators in
line. It frustrated a poten-
tially crippling general strike
on 27 July by threatening to
prosecute any utilities workers
who stayed off the job.
Political maneuvering con-
tinues in an effort to restore
unity within the majority Cen-
ter Union party which was split
by some defections to Athanasia-
dis-Novas. Papandreou, who is
Under present conditions, a
national vote would take on the
character of a plebiscite on
the status of the monarchy.
Parliament begins debating
a vote of confidence for
Athanasiadis-Novas on 30 July.
There seems little chance that
he will succeed. If the trend
is against him from the start,
he may resign even before a
vote, to open the way for a com-
promise candidate. The name of
former deputy prime minister
Stephanopoulos has been most
frequently mentioned to fill
this role if, as the US Embassy
in Athens comments, someone
can prop him up long enough to
accept it. The governor of the
Bank of Greece, Xenophon Zolotas,
has also been cited as another
possibility.
A trend toward a new right-
left polarization in Greek
politics. is threatening, how-
ever, with the possibility of
army intervention in su
of the King.
SECRET
Page 22 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET
EEC STALEMATE THREATENS KENNEDY ROUND TRADE NEGOTIATIONS
Anxiety is growing over
the Kennedy Round of tariff
negotiations as the crisis in
the European Economic Community
drags on. Next to the US, the
EEC is the most important of
the negotiating parties, and,
unless it is able to enter into
effective bargaining, the out-
look for any sizable reduction
in tariffs is cloudy indeed.
Moreover, if present deadlines
in the tight negotiating sched-
ule slip by, the US Trade Expan-
sion Act may have expired--in
July 1967--before the negotia-
tions can be concluded.
There has been no real
loss of momentum since the EEC
crisis erupted on 30 June be-
cause no major new decisions
outside the EEC negotiators'
existing mandates have been re-
quired. A crucial test will
come on 16 September, however,
when additional offers of re-
ductions in agricultural pro-
tection are scheduled to be
tabled. Failure to proceed
with meaningful negotiations
on agriculture at that time
would destroy the balance of
progress in both industrial and
agricultural sectors which has
been a principal hypothesis of
the talks from the beginning.
Most observers believe the
EEC will be unable to meet this
date. The consensus which ap-
parently emerged from the 26-27
July meeting of the EEC Council
was that a special Council ses-
sion--now set for October--would
be necessary to work out a
community position.
Faced with the prospect of
an EEC default, the other nego-
tiating parties must decide
whether tabling their own offers
will induce the EEC to "catch
up" or merely undercut their
bargaining position. The US
delegation believes that, if
other major participants also
fail to meet the agricultural
deadline, further pressure will
be generated to cease meaningful
industrial negotiations as well.
The requirements of the
Kennedy Round schedule are
likely in fact to have consider-
able impact on the outcome of
the EEC crisis. Germany, Italy,
and the Benelux states, with a
heavy stake in an expanding
world market for industrial prod-
ucts, may feel increasingly
desperate to satisfy the--as yet
unspecified--French demands so
the community will be able to
make the decisions the Kennedy
Round requires.
Paris, however, is also
under some domestic pressure
not to let the Kennedy Round
run out of steam. French inter-
est in the world-wide agreement
on grains cannot be satisfied
in the foreseeable future out-
side the Kennedy Round context,
and some government circles seem
also concerned lest other French
commercial interests suffer from
a prolonged Kennedy Round
stalemate.
Finally, both sides in the
EEC must take into consideration
that, if the EEC deadlock per-
sists into next year, Kennedy
Round issues can then be decided
by majority vote.
SECRET
Page 24 WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
ROW
SECRET
NONALIGNED DOMINICAN GROUPS PRESS FOR EARLY SETTLEMENT
Influential groups not com-
mitted to either side in the Do-
minican stalemate are demanding
that the Caamano and Imbert fac-
tions reach a settlement. The
country's largest labor union
has joined businessmen from Santo
Domingo and the interior city of
Santiago in urging a quick agree-
ment. The second largest labor
union, which has backed the reb-
els, pledged support for the OAS
formula and the proposed provi-
sional government. These groups
have been spurred to action in
part by continued economic stag-
nation, widespread unemployment,
and disruption of normal commer-
cial activities.
Despite pressure from these
groups, only minor progress was
made in negotiations during the
past week. The rebels tenta-
tively agreed to a revised in-
stitutional act that will guide
the new government. No solution
has been found, however, for such
major problems as the future of
the rebel military, disarmament
of civilians, control of extrem-
ists,and the length of stay of
the Inter-American Peace Force.
Indeed, the OAS formula received
a temporary setback when Eduardo
Read Barreras declined to serve
as vice president in a provi-
sional government. Read feels
the interim regime faces a bit-
ter future and is concerned that
it will not be able to disarm
the rebels and control the armed
forces.
Leaders of the antirebel
armed forces now are supporting
the OAS formula for a provisional
government and have displayed
a somewhat flexible attitude in
negotiations with the OAS.-
The military, through its
moderate position, is probably
trying to improve its image and
head off demands for military
reform. The leading officers,
however, show no signs of per-
mitting the rebels any influence
in the military and continue to
demand the disbanding of rebel
paramilitary units.
Non-Communists in the rebel
camp seem to be splitting over
the type of settlement to demand.
Juan Bosch, titular leader of
the Dominican Revolutionary Party
(PRD), favors a quick settlement
and has even proposed that the
rebel congress formally recognize
Garcia Godoy as president. The
PRD leadership in Santo Domingo
advised against this, however,
arguing that it would further
antagonize those rebels who ac-
cepted Garcia Godoy only with
reluctance. Moderates. in the
PRD, moreover, seem resentful
of rebel "minister for the
SECRET
Page 25 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
l'E C,'1tt 1 '
presidency" Hector Aristy's in-
fluence on Caamano and have
hinted that they might oppose
his views solely because it is
he who is advancing them.
Demands for "a protracted
war" continue to be voiced by
the pro-Castro Fourteenth of
June Political Group (APCJ) and
the Chinese-influenced Dominican
Popular Movement. Both groups
feel that by maintaining the
fight the US will be pressed to
accede to rebel demands.
RECENT SOVIET MILITARY SHIPMENTS TO CUBA
The first significant de- (parts, ammunition, and possibly
livery of Soviet military equip-
ment to Cuba this year appears
to have been completed. In the
past month, three Soviet freight-
ers, the Transbalt, the F. Z.
Kuryi, and the ratstvo arfir ved
n Cuba with possible military
cargoes. Observations made at
Mariel naval base indicated that
military equipment had been off-
loaded there, and preparations
for what appeared to be the ar-
rival of military equipment were
observed at Bahia Honda.
The arrival of as many as
three Soviet military shipments
in a comparatively short space
of time appears to have no spe-
cial significance, although it
is unusual. The only other
known military delivery this
year was a relatively modest one
made by the Metallurg Anosov
on 11 June. It probably con-
sisted
two cruise missiles. It is pos-
sible that other small deliveries
of equipment for the Ministry of
Defense may have arrived unde-
tected along with commercial
cargoes.
Soviet deliveries of mili-
tary equipment since October
1962 appear designed chiefly to
maintain rather than increase
the level of arms in Cuba. Fur-
ther delivery of replacement
equipment necessary to maintain
the existing surface-to-air mis-
sile sites in Cuba may begin in
the near future since much of
the solid-propellant fuel and
many booster engines for the Cu-
ban missiles are believed to be
reaching the limit of service-
ability.
SE CRE T
Page 26 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
SECRET
In a major speech on 26
July, Fidel Castro was mainly
preoccupied with Cuban domestic
affairs, a theme which has in-
creasingly replaced his clarion
calls for revolution elsewhere
in Latin America. Castro, speak-
ing for three hours on the 12th
anniversary of the start of his
revolution, concentrated on in-
ternal political and adminis-
trative matters and only briefly
berated "enemies" of his regime.
Castro spoke extensively on
the PURS (United Party of the
Socialist Revolution), explaining
the enhanced role this single
Cuban party will play in local
affairs and lecturing on its
ideology. He pointed out that
it will not merely imitate for-
eign examples, but will be based
on the "spirit and peculiarities"
of Cuba. The FURS, with a mem-
bership of about 45,000, has
grown gradually in the past two
years and has reflected Fidel's
increased willingness to insti-
tutionalize the revolution.
Castro also announced a new
system of administration to re-
place the coordinating boards
(JUCEI) which have been the
principal organs of local au-
thority since late 1960. The
new system will be more respon-
sible to the PURS, and will re-
flect the increased decentrali-
zation which Castro called
for.
The anniversary speech on
political restructuring at
least temporarily moves the
focus away from the economic
matters which have interested
Castro since last summer.
With the economy now started
on an upturn, he may devote
more time to internal political
problems. He suggested in
his speech that a socialist
constitution may be ready
within a year, and the organi-
zation of the PURS will prob-
ably be completed by that
time. A definition of the
powers and structure of the
PURS national directorate
may also be in the offing.
By attempting to strengthen
the economy and internal admin-
istration, Castro apparently
is trying to make Cuba a show-
case for revolution. In his
speech he urged Latin American
revolutionaries to follow
Cuba's example, but said that
Cuba's first duty is to de-
velop itself ideologically
and economically. Castro,
however, in turning the con-
centration of his revolution
upon itself, has probably
not altered his belief in the
"inevitability of the revolu-
tionary struggle." In fact,
he added Peru to the list of
Latin American countries--
Guatemala, Venezuela, and
Colombia--which he considers
the best targets for revolu-
SECRET
Page 27 WEEKLY SUMMARY 30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
I%W
SECRET
The regime of General Lopez
in Honduras appears to be failing
in its efforts at creating a sem-
blance of national conciliation
following the reinstitution of
constitutional rule last month.
The unexpected resignation of
Foreign Minister Jose Angel U1-
loa on 16 July leaves only one
member of the majority Liberal
Party in a cabinet dominated by
the minority Nationalist Party.
Speculation in Tegucigalpa
suggests that Ulloa resigned be-
cause many well-qualified Lib-
erals had been dismissed from gov-
ernment jobs. His lack of a free
hand in selecting ambassadors
and subordinates in the ministry
undoubtedly played a role also.
The remaining Liberal--Labor Min-
ister Amado Nunez--may resign
shortly.
SF, CRET
The
new foreign minister,
Tiburcio
Carias
Castillo, is a
brother of the
leader of the
Popular Progressive Party (PPP)
--an offshoot of the ruling Na-
tionalist
Party. Carias' ap-
pointment
should help bring the
dissident
PPP back into the Na-
tionalist
fold, thereby
broad-
ening the
government's
politi-
cal base
and furthering
Lopez'
goal.
Unlikely to be a strong
cabinet member, Carias has
served several times as dele-
gate to the United Nations Gen-
eral Assembly and as ambas-
sador to Great Britain. Hon-
duran foreign policy is ex-
pected to continue its Western
orientation.
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET
World-wide
MEETING OF EIGHTEEN-NATION DISARMAMENT COMMITTEE BEGINS
The Eighteen-Nation Disarm-
ament Committee (ENDC) resumed
sessions this week, but prospects
for productive discussions are
dim because of differences among
the Western Allies over the terms
of an agreement on nonprolifera-
tion of nuclear weapons and ap-
parent Soviet intentions to use
the forum merely to attack US
policy in Vietnam.
At the NATO Council meeting
on 26 July, both the British and
Canadians offered drafts of a
nonproliferation agreement, with
the UK's in particular provoking
the expected reservations from
West Germany and Italy. Both
countries objected to language
which might impede the subse-
quent organization of a NATO
nuclear force and both wanted
treaty guarantees to nonnuclear
states.
In light of these objec-
tions, the British agreed not to
table any proposals in the ENDC
until there had been "sufficient"
Allied consultation. They have
since proposed alternative lan-
guage, but the US delegation
doubts that it will prove any
more acceptable than the earlier
version. If the present dif-
ferences continue, London may
feel obliged by domestic polit-
ical considerations to go ahead.
The Canadian draft differs
from the British primarily in
providing for a collective se-
curity guarantee by nuclear
powers to nonnuclear states in
case of nuclear attack--as India
and other nonaligned nations
-proposed during the recent UN
Disarmament Commission talks.
Italy favors this and also
favors inserting a clause which
would allow any signatory to
withdraw from the treaty should
a multilateral nuclear force or
a new nuclear state emerge.
Such a provision, Rome probably
believes, would help overcome
Soviet difficulties with a NATO
nuclear force. However, the
Soviet delegate, when queried,
dismissed the idea as "useless."
France, which is a member
of the ENDC but refuses to at-
tend because it claims the Com-
mittee is too unwieldy to nego-
tiate complex disarmament is-
sues, has shown considerable
interest in ENDC proceedings.
French officials admit that
they consider disarmament of
great importance despite Paris'
"empty chair" policy. They
probably also realize that this
policy is inconsistent with the
role De Gaulle wishes to play
with the nonaligned nations.
Another reason for this
interest may be France's own
strong opposition to the MLF.
A French official has claimed
that the Soviets severely rep-
rimanded the French for re-
fusing to take part in the dis-
cussions, probably because the
Soviets would like more support
in their attack on the MLF.
The French claim that Soviet
opposition to the MLF is not a
tactic but a reflection of gen-
uine mistrust and fear of Ger-
many,
Page 29 WEEKLY SUMMARY
30 July 65
Approved For Release 2008/05/29: CIA-RDP79-00927A004900130001-6
SECRET
 25X1 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
 Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6
%m JC%. KC I `fir/
SECRET
Approved For Release 2008/05/29: CIA-RDP79-00927AO04900130001-6