CENTRAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A005100180001-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 15, 2016
• Document Release Date: September 11, 2002
• Sequence Number: 1
• Publication Date: May 21, 1960
• Content Type: REPORT

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CENTRAL INTELLIGENCE BULLETIN
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21 May 1960
DAILY BRIEF
I. THE COMMUNIST BLOC
Communist China: Although Peiping is making a big
show of firm support for the Soviet Union following the
summit conference, a People's Daily editorial of 20 May
contains some indications t at-the Chinese may fear that
Khrushchev will not maintain, in the long run, his present
uncompromising attitudEe toward the West. In justification
of Peiping's pre-summit position, the editorial states that
the outcome of the conference was no surprise to those who
view the international situation correctly and are not misled
by "certain superficial phenomena." The editorial suggests
the Chinese probably hope to use current developments to in-
crease their influence throughout the Communist world as
the most accurate interpreters of Marxist-Leninist theory.
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U
IL ASIA-AFRICA
? India-USSR: New :Delhi has announced plans to construct
two adc ' ional government-owned oil refineries during the gimem'
\
Third Five-Year Plan (1961-66). These would presumably
be in addition to a previously announced medium-size refin-
ery slated for the Bombay region. The scheduled visits to
Moscow next month by President Prasad, Finance Minister
Desai, and Mines and Oil Minister Malaviya are likely to re-
sult in additional assistance to the Indian petroleum industry,
including an offer to construct the two new refineries. The
bloc is alread assisting the construction of two other refin-
eries.
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of the press and by leftists for alleged undemocratic and un-
parliamentary methods in securing lower-house approval of
the US-.Japan security treaty. The vote on 20 May, which
overrode Socialist violence and a boycott, appears to assure
final ratification by upper-house action prior to President 011
Eisenhower's visit on 19 June. More leftist-sponsored dem-
onstrations can be expected, and the two Socialist parties
have said they will continue to boycott the Diet. Kishi's con
trol of his party will depend on the extent and depth of adverse
public reaction, which his party rivals will be alert to exploit.
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DAILY BRIEF
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INHO
1101
HEMN,
H
NamENE
South Korea: The proffered resignation of South Korean Army Chieftaff Lt., Gen. Song Yo-than could adversely
affect South Korean military capabilities if it leads to a
NMI,
rash of resignations and retirements by able senior officers.
Song's resignation may have. been prompted by a desire to
n 1 save the prestige he gained as a result of the army's restrained
role in the disturbances that toppled Rhee from power. Song
t
ol
h
ifi
th
i
i
f
r
e
e
gn
can
e s
cism
or
would be vulnerable to crit
played in . delivering the soldiers' vote to the Rhee re ime in
the 15 March elec. ions.,
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.III. THE WEST
Cuba: The Castro government on 18 May ordered that each
refinery in Cuba for the rest of this year must purchase approx-
imately 300,000 tons of Soviet crude oil, now arriving under the
Cuban-Soviet trade agreement This affects three large refin-
eries--Esso, Texaco, and Shell--which produce about 95 per-
cent of Cuba's refined petroleum products. Cuban controls on
US dollar remittances have been tying up the funds of the oil
companies, and the Castro regime is using this form of pres-
to make the companies purchase the Soviet crude for re-
sure
fining. Relations between the Castro regime and the government
of Venezuela-Cuba's chief source of petroleum--are likely to be
further alienated by Cuban purchase of competitive Soviet oil.
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LATE ITEMS
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*USSR: The main purpose of Khrushchev's speech in East
Berlin on 20 May probably was to provide assurances that
despite the collapse of the summit conference and his clear
intention to maintain harsh attacks on the United States, the
USSR=does not plan.to abandon its peaceful coexistence line or
revert- to a hard, "Stalinist" posture toward the non-Commu-
nist world. Khrushchev appears anxious to demonstrate that
his detente policy continues to be valid and justified. Although
the Soviet premier claimed that the breakdown of the Paris
meeting has given the Soviet Union and its allies a "moral right"
to proceed without further delay with a separate peace treaty
with East Germany, he stated that the "status quo" with regard
to a German treaty and l'Vest Berlin will be maintained until
another heads-of-government. meeting takes place, which he
"assumes" will be in six to eight months. Khrushchev's rela-
tively moderate line in this speech will displease any critics in
the Communist world who had opposed his peaceful coexistence
diplomacy and had interpreted his performance in Paris as fore-
shadowing abandonment of this line.
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Peiping Vindicates Its Interpretation of US Motives
Despite Peiping's major demonstrations of "firm support"
for the Soviet Union following. the summit conference, the Chi-
nese are taking advantage of the conference breakdown to vin-
dicate their views against accommodation with the West. A
People's Daily editorial of 20 May states that the outcome of
the conference was no surprise to those who view the interna-
tional situation correctly and are not misled by "certain super-
ficial phenomena:'
The Chinese had maintained all along that there had been
no real change in the American attitude toward the Communist
world and that the principal task of the bloc was therefore to
expose the false nature of American peace gestures. A few. days
before the summit meeting was to convene, Mao Tse-tung had
implicitly criticized Khrushchev for having "illusions" about
"US imperialism."
The 20 May editorial contains some indications that the Chi-
nese may fear that Khr1uLshchev will not maintain, in the long run,
his present uncompromising attitude toward the West. In this
connection, the editorial assesses the summit breakdown as
"helpful" because it "laid bare" the "ferocious" features of "US
imperialism" and calls, as did the Chinese in the pre-summit
period, for further exposure of the United States.
By emphasizing that the Chinese were right and Khrushchev
wrong, the editorial suggests the Chinese probably hope to use
present developments to, increase their influence throughout the
Communist world as the most accurate interpreters of Marxist-
Leninist theory.
That Moscow now is on the defensive can be seen in Soviet
Ambassador Chervonen:k.o's speech at a rally in Peiping on 20 May.
"Like other people," he said, "the Soviet people have never de-
ceived themselves with illusions and have always remembered
the imperialist intrigues,' On the contrary, People's Daily said
on the same day, events of the past few days prove misguided
those who had naively thought that imperialism could be dealt with.
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II. ASIA-AFRICA
Planned. New Indian Refineries May Receive Soviet Assistance
New Delhi has announced its intention to construct two
additional oil refineries during the Third Five-Year Plan
(1961-66). The location and the financing arrangements for
these new government-owned projects were not made public.
They would presumably be in addition to a medium-size re-
finery in the Cambay: region near Bombay for which plans
were announced in April. Promising oil strikes were recent-
ly made in that area by bloc technicians under contract to the
Indian. Government.
Scheduled visits to Moscow in June by three Indian dele-
gations led by President Prasad, Finance Minister Desai,
and particularly K. D. Ma.laviya, Indian minister for mines
and oil, will afford the Soviet Union an opportunity to expand
its dominant position in India's oil industry by making further
offers of assistance. Moscow is likely to offer to aid in the
construction of the two new refineries and may also propose
further Indo-Soviet collaboration in the petroleum industry.
India will receive some Soviet-refined POL products this
year under terms of the current Indo- Soviet trade agreement.
Moreover, Moscow has recently offered "unlimited" quanti-
ties of crude oil, at discount and for rupee payment--a pro-
posal which the Indians will be able fully to utilize only when
they possess their own refineries. In addition, the USSR and
Rumania are assisting the Indians in construction of two other
refineries in. eastern India for processing Indian crude oil;
aid thus far committed to these projects amounts to $40,000,-
000, about 5 percent of total bloc aid to India.
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Japanese Reaction to Security Treaty Vote
Most major Japanese newspapers are accusing Prime Min-
ister Kishi of violating democratic and parliamentary principles
in forcing lower-house approval of the US-Japanese security
treaty on 20 May. One paper, however, stressed Japan's need
for such a treaty under.present world conditions, and another
paper criticized the opposition Socialists for their resort to vio-
lence prior to the vote.
The two Socialist parties are claiming that passage of the
treaty was illegal and invalid and are now boycotting the Diet
session. The governing ~ iberal Democrats, although they have
enough seats to conduct parliamentary business without the So-
cialists, are almost certain to undertake negotiations with them
in an effort-to end the boycott and return to normal procedures.
A: demonstration led by extreme leftist students broke out
in the vicinity of the Diet soon after the treaty vote, and some
students forced entry into the grounds of Kishi's official resi-
dence. More leftist-sponsored demonstrations can be expected,
although previous extremist efforts have failed to attract popu-
lar support.
The lower-house vote appears to assure final ratification of
the security pact before President Eisenhower's visit on 19 June.
The treaty has been referred to the upper house and, even if this
body fails to vote, approval will be automatic after 30 days. A
50-day extension of the Diet session assures the necessary time
period.
Some Japanese political observers believe that Kishi's chances
for winning a third term as president of the government party in
January 1961 have been weakened by the steps taken to obtain ap-
proval of the treaty. They note that several of his party rivals,
including Ichiro Kono, absented themselves during the vote. While
Kishi's rivals will be alert to exploit any adverse public reaction,
his control of the party will depend on the extent and depth of such
popular sentiment.
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][II. THE WEST
American Refineries in Cuba Ordered to Process Soviet
Crude Oil
On 18 May, the. Castro regime notified officials of the
Texaco refinery in Cuba. that for the rest of this year each
refinery in the country must accept approximately 300,000
tons of Soviet crude oil, which has begun to arrive in Cuba
under the Cuban-Soviet trade agreement signed in February.
This will affect the three refineries-- Texaco, Esso, and
Shell--which together produce over 95 percent of the petro-
leum products refined, in Cuba. These companies have some
$40,000,000 worth of outstanding requests for dollar remit-
tances which the Cuban National Bank has not yet approved.
Cuban controls on US dollar remittances have been tying up
the funds of the refineries, and the Castro regime evidently
.is using this form of pressure in an effort to make the com-
panies accept Soviet crude. Soviet crude is received by
Cuba under a barter arrangement, and the refineries would
not be required to pay for it in foreign exchange.
Official Venezuelan relations with the Castro government,
which have grown increasingly cool in recent weeks, are like-
ly to be further alienated by Cuban purchases of competitive
Soviet oil. In 1958, Venezuela exported about 75,000 barrels
a day of oil and refined products to Cuba, about 8 percent of
which presumably will now be supplied by the USSR. In a
front-page editorial, one prominent anti-Castro Venezuelan
newspaper recently condemned the Soviet-Cuban oil arrange-
ments. Venezuela is also facing a potential loss to the USSR
of a portion of its market for petroleum in two other Latin
American nations- - Uruand Brazil.
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LATE ITEM
Khrushchev's Speech in East Berlin
Khrushchev used his speech in East Berlin on 20 May as the
occasion for his first major foreign policy statement since the
collapse of the summit meeting. His main purpose probably was
to provide assurances that he does not intend to abandon his peace-
ful coexistence line or revert to a hard, "Stalinist" posture toward
the non-Communist world.
Despite his clear intention to mount on all-out propaganda
campaign to discredit and isolate the United States on. the issue
of "aggressive and provocative actions" toward the USSR, Khru-
shchev apparently hopes to salvage as much of his detente policy
as possible. He stated that he assumes that another heads-of-
government meeting will take place in six to eight months, and
declared
that the
will do nothing in the interim that might "aggravate
the international situation and take us back to the dark time of the
cold war!'
On the key issue of Berlin, Khrushchev said he had reached
agreement with East German leaders that, since a summit meet-
ing will be held in six to eight months, no unilateral moves would
be taken. until a further effort can be made to reach .agreement with
the three Western powers on a peace treaty with the two German
states. Although he claiimed that the breakdown of the Paris meet-
ing has given the USSR and its allies a "moral right" to proceed
without further delay with a separate treaty with East Germany, he
pledged that the status quo will be maintained until a summit meet-
ing convenes. This commitment, however, was made conditional
on the Western powers' willingness to avoid "any unilateral steps"
which would prevent such a meeting in six to eight months.
The line Khrushchev took in this speech suggests that he feels
under the necessity of demonstrating that his detente policy in re-
cent months was right and justified and is still valid. He recalled
that after returning from his visit to the United States he had pointed
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out that President Eisenhower was in a "difficult position" as a
result of a "hidden" struggle in the United States between the
"forces of the cold war'"' and the "advocates of peaceful coexist-
ence." HCe observed that he had recognized such "alarm signals"
long before the summit meeting and implied that the U-2 incident
resulted from the victoY^y of the "cold war forces
Khrushchev's relatively moderate tone in outlining his future
course of action will displease any critics in the Communist world
who had opposed his peaceful coexistence diplomacy and had inter-
preted his performance 'in Paris as foreshadowing a complete
abandonment of this line.
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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
Director, Office of Civil and Defense Mobilization
Director, National Aeronautics and Space Administration
Special Assistant for Security Operations Coordination
Chairman, Board of Consultants on Foreign Intelligence Activities
Special Assistant for Foreign Economic Policy
Executive Secretary, National Security Council
The Treasury Department
The Secretary of the Treasury
The Department of State
The Secretary of State
The Under Secretary of State
The Under Secretary of State for Political Affairs
The Deputy Under Secretary of State for Politic:a. Affairs
The Deputy Under Secretary of State for Administration
The Counselor
Director, International Cooperation Administration
The Director of Intelligence and Research
The Department of Defense
The Secretary of Defense
The Deputy Secretary of Defense
Assistant Secretary of Defense for International Security Affairs
The Secretary of the Army
The Secretary of the Navy
The Secretary-of the Air Force
The Chairman, The Joint Chiefs of Staff
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
Commandant, United States Marine Corps
Assistant to Secretary of Defense for Special Operations
Director for Inteliige!lce, The Joint Staff
Assistant Chief of Staff for Intelligence, Department of Army
Director of Naval Intelligence, Department of Navy
Assistant Chief of Staff, Intelligence, Department of the Air Force
Supreme Allied Commander, Europe
Commander in Chief, Pacific
The Department of Commerce
The Secretary of Commerce
Federal Bureau of Investigation
The Director
Atomic Energy Commission
The Chairman
National Security Agency
The Director
National Indications Center
The Director
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