CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A003600180001-2
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 15, 2016
• Document Release Date: January 15, 2003
• Sequence Number: 1
• Publication Date: March 21, 1958
• Content Type: REPORT

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CENTRAL INTELLIGENCE BULLETIN
21 March 1958
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6 i5
DAILY BRIEF
. TIDE COMMUNIST BLOC
Supreme Soviet meeting; The USSR Supreme Soviet
has been summoned, on unusually short notice, to meet
on 27 March. Legislation on the machine tractor station
reorganization will be discussed. Rapid convocation of
the Soviet, only 11 days after its election, could give: the
reorganization a further push as the new planting season
gets under way, and could be intended to undercut any re-
maining opposition to the change. The session may re-
move Bulganin from the premiership.
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II. ASIA-AFRICA
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Japan - South Vietnam: The last of Japan's reparations
obligations has been settled by South Vietnam's acceptance
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concern over an Indo-Pakistani arms race.
IS
i
us oans s o
of Japans proposal to grant $39,000,000 p
be negotiated. An informal agreement has been initialed in
Saigon. This agreement will aid Tokyo's extensive efforts
to achieve closer economic relations with Southeast Asia.
Tokyo hopes to keep the agreement secret, and Japanese
action is expected to be postponed until after the national
elections later this year. 25X1A
(Page 5)
Pakistan -Britain: Pakistani representatives are nego-
tiating with Britain for the purchase of OCanberra light
bombers, eight trainers, and four photo reconnaissance
planes. Britain, which has received Indian orders for 0
Canberras, apparently feels it cannot easily deny similar
116 equipment to a fellow Commonwealth member, despite its
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Morocco-Spain: An agreement calling for Spain to
transfer control over its protectorate in Southern Moroc-
co to the Rabat government hit a snag on 19 March when
Moroccan Foreign Minister Balafrej rejected a new Span-
ish stipulation that the Moroccan Government "guarantee
there will be no new aggression from Morocco against
Spain." This is probably the first official move in what
will be a protracted campaign to achieve the withdrawal
of Spanish and French troops from Morocco. The United
States may be asked to assist in the mediation of ensuing
differences.
(Map)
The Cyprus situation: EOKA is carrying out its re-
sistance campaign wit isolated acts of sabotage. British
Governor Foot is pessimistic over the prospects for settle-
ment of the Cyprus issue, but feels there is still a limited
time in which to find a solution. He recognizes the barrier
imposed by the unyielding attitudes of both the Turks and
the Greeks.
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III. THE WEST
France: The publication of the resignation threat of
Generaaul Ely, French armed forces chief of staff, who
demands an increase in the military budget, has probably
reopened a thorny issue on which Gaillard won grudging
agreement in the National Assembly on 7 March. This
question may be a factor in the decision the Independents
expect to make on 25 March regarding their continuance
in the coalition.
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Cuba: Catholic Church leaders have apparently re-
sumefforts to resolve the 16 -month-old, .crisis`., by,
mediation. The bishop of Matanzas has proposed to Ba-
tista that he step down in favor of a provisional govern-
ment headed by the senior justice of the Supreme Court.
Tension, especially in Oriente Province, continues to
rise as a result of Fidel Castro's 22-point ultimatum of
17 March.
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New Supreme Soviet Summoned
The USSR Supreme Soviet elected on 16 March will
hold its first session on 27 March. Official announce-
ment of convocation was made in Moscow only eight days
before the session is scheduled to begin. The short notice
given may be a steam-roller maneuver on the part of Khru-
shchev designed to crush high-level opposition to his agri-
cultural reorganization scheme.
In 1954, the last election year, there was an interval
of 37 days between election day and the first session, and
since then there has been an average of 23 days between
announcement of meetings and their opening.
It has already been indicated that the Supreme Soviet
will hear a report from Khrushchev on the program for
the transfer of agricultural machinery from machine
tractor stations to collective farms and that legislation
on implementation of the plan will be issued. In addi-
tion to possible tactical purposes Khrushchev may have,
rapid summoning of the Soviet may be intended to get
such legislation on the books for the beginning of the
planting season.
The Supreme Soviet may also be called on to take
action with respect to Bulganin, whose days as premier
are numbered, according to widespread reports.
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Japan and South Vietnam Reach Reparations Settlement
Japan apparently has completed a phase of its inten-
sive program to develop closer economic relations with
Southeast Asia by reaching an informal agreement with
.South Vietnam, the last reparations claimant. Tokyo be-
lieves that settlement of its post-World-War-II repara-
tions obligations would create more favorable attitudes in
Southeast Asia toward Japan and would in turn lead to in-
creased trade and overseas investment.
Japanese negotiators and Vietnamese officials have
initialed an agreement calling for Tokyo to provide $39, -
000,000 in direct grants and still to be negotiated long-
term loans to cover Vietnamese power development, con-
sumer goods purchases, and:certain joint investment proj-
ects. The Japanese Foreign Ministry has indicated that
for political reasons the Kishi government will postpone
formal announcement of the agreement and will not seek
Diet approval until after general elections which are ex-
pected later this year.
Reparations agreements with Burma and the Philip-
pines already are operative, and a recent settlement with
Indonesia is expected to be ratified shortly. Including the
Vietnamese settlement, Japan is committed to grants of
about $1. 2 billion by 1976. Annual payments for the next
few years are estimated at approximately $72,000,000,
plus loans, after which annual payments will diminish. The
Japanese Ministry of Finance fears that the financial burden
may be too heavy.
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Pakistan Seeks Canberra Light. Bombers in Britain
Pakistani representatives are ne otiating with the
British firm of English Electric for ]Canberras, in-
cludingE::~ight bombers, ______trainers, and =photo
reconnaissance planes. T ey are doing so apparently at
the insistence of Prime Minister Noon, despite an assur-
ance from President Mirza to the American ambassador
on 7 March that there would be no such negotiations.
Pakistan, which is also pressing the United States
for light bombers, seems to feel the need of countering
India's orders for up toLCanberras from Britain. It
apparently is prepared to pay an initial cost of possibly
$35,000,000 and to undertake subsequent upkeep, de-
spite the questionable ability of its unhealthy economy
to support such an expense. Pakistan may be consider-
ing a drastic reduction in its naval forces, including
cancellation of a recent effort to buy a submarine, in
order to pay for the planes.
Britain is concerned over contributing to an Indo-
Pakistani arms race but would find it difficult to re-
fuse Pakistan's request after selling planes to India.
London will insist on cash a ment though Pakistan
has sought credit terms.
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Morocco Rejects New Spanish Condition for Transfer of
Southern Morocco
Moroccan Foreign Minister Balafrej on 19 March re-
jected a new Spanish demand, made during negotiations
for the transfer of control over the Spanish protectorate
of Southern Morocco, that the Rabat government "guaran-
tee there will be no new aggression from Morocco against
Spain." Madrid fears that a recent Moroccan army re-
groupment near Southern Morocco indicates an impending
attempt to seize the area, and has charged that Moroccan
irregulars, recently engaged with Spanish forces in Ifni
and Spanish West Africa, are being incorporated in Moroc-
can army units.
Balafrej has labeled the stipulation "preposterous and
deliberately offensive, " and believes that Spanish military
circles have sabotaged the agreement, which was nearing
completion. Spanish army leaders, embittered by the sur-
render of Spain's northern protectorate in April 1956, op-
pose cession of the southern area unless Spain obtains maxi-
mum guarantees against further hostilities mounted from
Morocco. Ambassador Lodge in Madrid reported on 14
March that in view of the political power of the Spanish
Army, any yielding by Franco to Moroccan "aggression"
might so weaken his prestige as to create a dangerous
threat to his regime.
Ambassador Cannon in Rabat anticipates that if the
long-delayed transfer cannot be effected soon, Morocco
may request the good offices of the United States.
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"me 140W
New Violence on Cyprus
Increasingly f recluent acts..of sabotage against British mili -
tary installations, supply dumps, and public utilities on Cyprus
have occurred in recent days. Between 7 and 20 March, 22
individual bomb incidents were reported. EOKA, the under-
ground Greek Cypriot organization, is apparently adding vio-
lence to its "passive resistance" campaign which began on 2
March. There is evidence, however, that the violence is
aimed at installations rather than British personnel on Cyprus.
According to Greek Foreign Minister Averoff, EOKA now is
in "very good shape" because of fairly large amounts of "ma-
teriel" recently shipped through the British blockade.
In addition to sabotage, EOKA is trying to enforce a
boycott by Greek Cypriots against certain British manufac-
tured or processed products including cigarettes, tobacco,
candy, beer, whiskey, and shoes. Reports indicate that the
boycott has not met with much success.
The British Governor of Cyprus remains pessimistic
about finding a solution acceptable to both Greeks and Turks.
A settlement which would involve granting the Turks a mili-
tary base or bases on Cyprus in exchange for permitting
the eventual union of the rest of the island with Greece is
now being promoted by London. There is no firm indication
at this time that either Athens or Ankara would accept such
a settlement. The Greeks appear willing to discuss the pro-
posal, but the political situation in Athens virtually precludes
further advance until after Greek national elections now ex-
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 III. THE WEST
French Military Pressure for Larger Budget Further
ea ens Gaillard
Publication of the resignation threat of French Armed
Forces Chief of Staff General Ely, who demands an increase
in the military budget, has probably reopened the issue of
military budget cuts on which Premier Gaillard won grudg-
ing agreement in the National Assembly on 7 March. In a
letter to Defense Minister Chaban-Delmas, Ely asked for
a $186,000,000 increase in funds to continue an effective
NATO contribution and Algerian pacification, and to re-
store the drastically reduced military construction pro-
grams.
Two air force generals in charge of material construc-
tion programs have already resigned in protest against the
cuts, and the simultaneous resignation of the air force
chief of staff, General Bailly, is attributed to the same
cause.
According to the American military attache, the Gail-
lard government's decision to increase the proportion of
the military budget devoted to Algerian operations at the
expense of other items was not coordinated with the mili-
tary staff. The military maintain the requested increase
could easily be obtained from civilian ministries' budgets.
The Independents have just served notice that they will
decide on 25 March whether the government's policy toward
Tunisia makes their continued participation in the coalition
possible. Revival of the military budget issue may be a de-
termining factor in the Independents' decision, and may en-
courage opponents of Gaillard to press for his overthrow
despite the proximity of the spring recess.
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Cuban Bishop Reported Urging Batista to Resign
Rising tension in Cuba, highlighted by rebel.leader
Fidel.Castro's 22-point ultimatum declaring "total war"
against President Batista, has apparently caused church
leaders to resume mediation efforts. A reliable source
of the American Embassy in Havana states that both the
archbishop of Oriente Province and the bishop of Matanzas
Province conferred with Batista on 18 March.
The bishop is said to have suggested that Batista
postpone the 1 June general elections and resign in favor
of a provisional government headed by the senior justice
of the Supreme Court. Similar demands have been made
by civic and political groups, but this is the first time a
member of the hierarchy is known to have suggested
Batista's withdrawal. The bishop was sufficiently en-
couraged to plan an interview with Castro.
Castro's ultimatum, made public on 17 March, threat-
ens to call a general, strike to be followed by armed action
during the first week in April. It also prohibits all traffic
in Oriente Province'and the payment of any taxes after 1
April and exhorts members of the armed forces to join the
rebel movement.
some residents of the city, alarmed because of the ultima-
tum, are talking of moving their families to Havana or
Miami.
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DISTRIBUTION
THE PRESIDENT
.The Vice President
Executive Offices of the White House
Special Assistant for National Security Affairs
Scientific Adviser to the President
Director of the Budget
Office of Defense Mobilization
Special Assistant for Security Operations Coordination
Operations Coordinating Board
Board of Consultants on Foreign Intelligence Activities
Special Assistant for Foreign Economic Policy
The Treasury Department
The Secretary of the Treasury
The Department of State
The Secretary of State
The Under Secretary of State
The Deputy Under Secretary for Political Affairs
The Deputy Under Secretary for Administration
The Deputy Under Secretary for Economic Affairs
The Counselor
Director, International Cooperation Administration
Director of Intelligence and Research
The Department of Defense
The Secretary of Defense
The Deputy Secretary of Defense
The Secretary of the Army
The Secretary of the Navy
The Secretary of the Air Force
The Chairman, The Joint Chiefs of Staff
Commandant, United States Marine Corps
The Director, The Joint Staff
Chief of Staff, United States Army
Chief of Naval Operations, United States Navy
Chief of Staff, United States Air Force
Assistant to Secretary of Defense for Special Operations
Deputy Director for Intelligence, The Joint Staff
Assistant Chief of Staff, Intelligence, Department of the Army
Director of Naval Intelligence, Department of the Navy
Assistant Chief of Staff, Intelligence, Department of the Air Force
Supreme Allied Commander, Europe
Commander in Chief, Pacific
Federal Bureau of Investigation
The Director
Atomic Energy Commission
The Chairman
National Security Agency
The Director
National Indications Center
The Director
United States Information Agency
The Director
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CENTRAL INTELLIGENCE BULLETIN
21 March 1958
DAILY BRIEF
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Supreme Soviet meeting: The USSR Supreme Soviet
has been summoned, on unusually short notice, to meet
on 27 March. Legislation on the machine tractor station
reorganization will be discussed. Rapid convocation of
the Soviet, only 11 days after its election, could give:. the
reorganization a further push as the new planting season
gets under way, and could be intended to undercut any re-
maining opposition to the change. The session may re-
m - b ulganin from the premiership.
France: The publication of the resignation threat of
General Paul Ely, French armed forces chief of staff, who
demands an increase in the military budget, has probably
reopened a thorny issue on which Gaillard won grudging
agreement in the National Assembly on 7 March. This
question may be a factor in the decision the Independents
A9 r t6offWOa@jk W9 i f T ~ ~ 1-2
in the coalition. 25X1 A
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