YUGOSLAVIA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80B01676R001100050005-2
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 4
• Document Creation Date: December 15, 2016
• Document Release Date: October 11, 2002
• Sequence Number: 5
• Publication Date: October 12, 1961
• Content Type: PAPER

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NSC BACKGROUND PAPER 12 October 1961
1. Yugoslavia's foreign policy derives from the Communist
orientation of the Yugoslav leaders and from their desire
to maintain the independence and freedom of maneuver acquired
as result of their separation from the Communist bloc in 1948.
A. Communist orientation has led the Yugoslav leaders to
adopt positions quite close to those of the USSR on
many questions of international importance; at the Bel--
grade Conference, Tito in speech on 3 September 1961
1. Hewed much closer to Soviet position on Germany
than US officials had been led to expect.
2. Stated that he understood the motives leading the
Soviets to resume nuclear testing.
B. Yugoslav's failure to be readmitted to the Communist
bloc on their own terms and their unwillingness to be
too closely associated with the West have led Belgrade
to an increasing identification with the foreign policy
interests of the "uncommitted" states.
1. Yugoslavia is publicly committed to a "non-bloc"
foreign policy, as are several other leading "un-
committed" states.
2. Yugoslavia is one of the leaders of the "uncommitted"
states along with India, Indonesia, and the UAR (Egypt).
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3. Yugoslavia is becoming increasingly committed to
economic and cultural cooperation with these
countries.
C. Despite its differences with, and propaganda attacks upon,
Western policies, Yugoslavia has developed increasingly
closer economic ties with the West since the rupture with
the bloc.
1. It is a member of GAAT (General Agreement on Trade and
Tariffs) and OECD (Organization for Economic Coopera-
tion and Development).
2. In 1960, almost 46% of its exports, and about 48% of
it imports, were with West European countries; the
figures for East Europe and the USSR total 32% for
exports, and 26% for imports.
3. Massive assistance from the West enabled the Yugo-
slavs to undertake their currency reform in 1960, which
was designed in part to enable Yugoslav economic ex-
changes with the West.
II. The Yugoslav regime, dominated by the leadership of the Yugo-
slav League of Communists (YLC) under Tito, is an unusually
(for Communist countries) stable administration.
A. Tito's personality has won considerable support for the
regime from the Yugoslav peoples; it is also central to
the unity of the YLC.
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B. The stability of the regime will be in jeopardy
when Tito dies because
1. No potential successor is considered able to fill
Tito's boots.
2. Dormant nationality problems could arise in an inter-
regnum.
III. The gradual shift away from typically Communist features of
government and adoption of some features typical of western
socialism will be formalized in a new constitution due to
be promulgated next spring.
A. For several years the YLC has sought to enhance the role
of non-party organizations in administering the country.
1. On the local. level through granting more power to
workers' councils.
2. On a broader level through enhancing the powers of
of trade unions and mass organizations such as the
Socialist Alliance of Working Peoples of Yugoslavia.
B. The several "republics" which comprise Yugoslavia have
considerable latitude in formulating regional policies.
one means through which the regime is attempting to
eradicate vestiges of nationality problems.
C. The YLC, however, continues to dominate behind the
scenes on all levels,
lV. It is on the domestic economic scene that Yugoslavia differs
most from a typical Communist state.
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A. Majority of Yugoslav agriculture remains a ncollectivized.
B. Elements of competition. have been introduced into the
production system.
V. The Yugoslav economy, in part due to foreign assistance, has
developed at a much more rapid rate than the economies of the
East European
A. The regime is alloting development funds within the country
in favor of the more backward areas (Montenegro, the
Kosmet, etc).
B. Yugoslavia hopes to be self-sufficient in several agri-
cultural commodities--such as wheat, sugar beets, and
corn--in the next few years.
C. In the first five months of 1961, industrial production
increased only 9% as against a projected 12% rise over
the same period last year. Shipbuilding, ferrous
metalurgy and textiles, important economic sectors,
showed little change over 1960 production levels. The
regime, however, does not feel concerned about meeting
the 1361 goals.
D. The standard of living in Yugoslavia in most respects
is probably higher than in East Europe, despite an in-
flationary trend in recent years. (Cost of living rose
about 10% in 1960).
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