ESTIMATE OF THE WORLD SITUATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R01012A010400040002-2
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 14
• Document Creation Date: December 23, 2016
• Document Release Date: October 29, 2013
• Sequence Number: 2
• Publication Date: January 29, 1957
• Content Type: NIE

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zt cVS'AS N1',E 1 0 0 ? 3 ? 5 7
29 January 11957
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N? 317
NATIONAL INTELLIGENCE ESTIMATE
NUMBER 190-3-57
(Supersedes NIE 100-7-55)
ESTIMATE OF THE WORLD SITUATION
Submitted by the
DIRECTOR OF CENTRAL INTELLIGENCE
The following intelligence organizations participated in the
preparation of this estimate: The Central Intelligence Agency
and the intelligence organizations of the Departments of
State, the Army, the Navy, the Air Force, and The Joint Staff.
Concurred in by the
INTELLIGENCE ADVISORY COMMITTEE
on 29 January 1957. Concurring were the Special Assistant,
Intelligence, Department of State; the Assistant Chief of
Staff, Intelligence, Department of the Army; the Director of
Naval Intelligence; the Director of Intelligence, USAF; and
the Deputy Director for Intelligence, The Joint Staff. The
Atomic Energy Commission Representative to the IAC, and the
Assistant Director, Federal Bureau of Investigation, abstained,
the subject being outside of their jurisdiction.
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CENTRAL INTELLIGENCE AGENCY
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ORMIEFEtT
ESTIMATE OF THE WORLD SITUATION
I. INTRODUCTION
1. The world situation in the past several
months has been characterized by dramatic
events and by an acceleration of the processes
of change. It is still too early to judge
whether the phase of rapid movement has
for the time being ended. The main forces
at work can be discerned, however, and are
briefly summarized in the following intro-
ductory paragraphs. They are further dis-
cussed in subsequent sections of this estimate.
2. The increasing nuclear capabilities of the
US and the USSR now powerfully deter both
powers from risking general war. Broaden-
ing realization of this deterrent during the
past few years contributed to a relaxation
of international tensions. During recent
months, however, events have appreciably
renewed the sense of insecurity in the world
and the fear that general war may occur
through miscalculation.
3. The force of nationalism operates in un-
usual strength. Within the Sino-Soviet Bloc
it has showed itself most conspicuously in the
Polish and Hungarian outbreaks, for which
the way was opened by de-Stalinization and
the relaxation of controls. In the very dif-
ferent circumstances of the underdeveloped
areas, especially in North Africa and parts
of the Middle East, it is manifested in an al-
most fanatic desire to eliminate the special
foreign privileges and influences associated
with colonialism.
4. The desire of the peoples in underdevel-
oped countries for social and political oppor-
tunity and for the fruits of rapid economic
development is a factor of great importance.
To achieve such objectives, governments in
these areas must obtain foreign assistance.
Even with such assistance, however, most of
these countries will find it difficult to divert
from consumption enough resources to keep
development programs moving ahead of pop-
ulation growth. The possibility therefore
exists that some regimes may be driven in-
creasingly to totalitarian measures to accom-
plish economic and social development, or
that they may be overturned by extremist
elements if they fail to achieve such devel-
opment. The widely-advertised industrial ad-
vance of Sino-Soviet Communism will exert
strong attraction as a pattern for achieving
rapid economic progress.
5. The vigorous political and economic of-
fensive of the USSR in underdeveloped coun-
tries has contributed to and profited from
the existence of these political and social stir-
rings. The USSR has held out to those coun-
tries an alternative to Western patronage and
has given them the opportunity of playing
off the West and the Bloc against one another.
By its courses of action in the Middle East the
Bloc has extended its conflict with the West
to a new area.
6. The continuing decline in the relative
power position of Western Europe has been
emphasized by the failure of the British and
French in their Suez enterprise. Western
European countries recognize that their secu-
rity rests on alliance with the United States.
They are, however, apprehensive at being thus
involved in the consequences of the struggle
between the US and the USSR, and there are
fears that weapons developments may weaken
US determination to come to Europe's defense
in a crisis. There has been some reconsidera-
tion of the implications of the Atlantic al-
liance, and thinking for the long term is not
yet crystallized.
7. Finally, one of the dominating factors of
the time is the continuing effort of Soviet
leaders to adjust the structure and ideology
of the Bloc and of international Communism
to the realities of the post-Stalin era. The re-
1
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SVISSMtertr- 2
laxation of police controls and the denigration
of Stalin had far-reaching effects throughout
the Communist world and beyond. As a re-
sult there has been some retreat from these
policies. It is clear that the Soviet leaders
are confronted with grave problems, and their
attempts to solve these problems will have a
profound effect on world developments.
II. TRENDS IN THE USSR
8. Some of the most significant developments
of the past year occurred in the USSR itself.
In the effort of the current Soviet leaders to
cope with their internal problems by exposing
and attempting to overcome the abuses of
Stalin's system, forces have been unleashed
with which the Soviet regime will have to
reckon for some time to come. The attack
on the dead dictator's historic role and on
ideas associated with his authority have raised
issues which tend to undermine the authority,
and perhaps the unity, of the party. The re-
pudiation of Stalin's terroristic practices and
the actual limitations imposed on the secret
police power have been followed by mani-
festations of discontent, especially in student
and intellectual circles, against which the re-
gime has already felt obliged to issue severe
warnings. While there is apparently no seri-
ous threat to internal security, the regime
has felt called upon to explain its position
and to answer criticisms to an extent for long
unknown. It is probably now determined not
to make further concessions to the latent
demand for greater political freedom, but it
probably also recognizes that it could not
revert to the more ruthless terrorism of the
Stalin period without a serious deterioration
in popular attitudes.
9. These developments will almost certainly
create difficulties for the Soviet leaders in
reaching collective decisions and pursuing
them consistently. There will probably be
occasional vacillation of policy. There are
likely to be changes in the relative position
and influence of the various members of the
Presidium, but it is virtually certain that
changes can be made without endangering
the regime itself. Whatever disagreements
may exist on such matters as internal eco-
nomic policy or policy toward the Satellites,
it is clear that the leadership is united on
the maintenance and extension of Soviet mili-
tary capabilities, the continuation of rapid
industrial growth, the carrying on of the
struggle against the non-Communist world,
and the exploitation of opportunities for ex-
panding Soviet influence, particularly in Asia
and Africa.
10. The present leaders continue to give high
priority to the rapid buildup of the USSR both
as a national state and as the base for world
Communism. They are obsessed with the idea
of surpassing the US in economic, scientific,
and military strength. Although difficulties
and problems exist in some sectors of the
economy, notably agriculture, over-all indus-
trial production has expanded at an average
rate of 12 percent annually for the past five
years. While this rate of growth is unlikely
to continue, the Soviet economy is now a
highly developed one.
11. While precise estimates of the Soviet nu-
clear weapons stockpile cannot be made, we
judge, from the amount of nuclear material
available and from the extent of known devel-
opment that this stockpile is now of formi-
dable magnitude. Although Soviet delivery
capabilities against the US are at present
relatively limited, they are growing steadily.
By 1960-1961 the USSR could acquire an in-
itial operational capability in intercontinental
guided misSiles. Thus, although Soviet po-
litical difficulties have mounted, the USSR's
military power continues to pose a grave po-
tential threat to the peace and security of
other nations.
III. TRENDS IN THE COMMUNIST WORLD
12. The efforts of the Soviet leaders to relax
international tension and to lift the most ob-
vious of the centralized controls of the police
state had their greatest visible impact outside
the USSR. Soviet authority over non-Soviet
Communist parties, particularly the operation
of Stalin's kind of controls over the other par-
ties of the Bloc, had already been weakened
by Stalin's death and by the less certain hands
of his successors. These parties were then
further shaken off balance by the Kremlin's
repudiation of certain of Stalin's policies, in-
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StitsiblAWT 3
eluding his Yugoslav policy, and above all
by the drastic expose of Stalin's errors at
the 20th Soviet Communist Party Congress.
Moreover, the Soviet leaders recognized more
clearly after the death of Stalin the need to
reconcile the national sentiments and inter-
ests of other Communist states with Moscow's
leadership of the Communist world. The open
enunciation at the 20th Soviet Communist
Party Congress of the doctrine of different
roads to socialism was apparently intended
to deal with these problems. This principle
was seized upon in the Eastern European
Satellites, and it encouraged a new flexibility
in the Communist parties outside the Com-
munist states. When combined with the ex-
pose of Stalinist errors and the relaxation of
internal controls providing a new range for
political expression, enunciation of this doc-
trine contributed to the unleashing of open
opposition in Poland and Hungary. To the
Communist parties outside the Bloc it ap-
peared to remove past inhibitions on the ex-
pression of factional differences. The result
has been a division within the Communist
movement unknown since the 1920's.
13. A few Communist leaders outside the
USSR have asserted that a fundamental re-
appraisal of Communist ideology is called for;
some have left the party; other Communists
are striving within the Communist movement
to push their local organizations into more
"independent" positions. On the other hand,
the Soviet leaders and the leadership of most
of the Communist parties outside the USSR
continue to maintain that no fundamental
revision is called for and that there can be no
dilution of the principal of international Com-
munist solidarity under Soviet leadership.
14. In the ideological discussions which have
followed the developments in Eastern Europe,
the Chinese Communist leaders have publicly
reaffirmed that the Soviet Union is the leader
of the Communist world. They have sup-
ported Soviet action in Hungary and have
denounced Tito's elaboration of the concept of
national Communism and different roads to
socialism. While insisting upon the overrid-
ing necessity to maintain Bloc solidarity, the
Chinese Communist leaders nevertheless ap-
pear to favor greater independence for the
individual states within the Bloc and have
endorsed Soviet acquiescence in greater au-
tonomy for the Gomulka regime. Sino-So-
viet ties will probably remain close during
the next several years. Despite its growing
strength, Communist China will remain de-
pendent on the Soviet Union for heavy mili-
tary equipment and for economic and tech-
nical assistance. The two regimes will con-
tinue to share a strong hostility to the West
and a vital interest in each other's security.
Within this framework Communist China will
occupy an increasingly important role in the
Sino-Soviet Bloc and will continue to exercise
a large measure of independence as the op-
erating arm of the Communist movement for
the Far East.
15. The relations of Marshal Tito with the
Soviet leaders have undergone a changing
course and at the moment are delicately
poised. During the first months of 1956, Tito's
relations with the Kremlin became noticeably
friendly, and steps were taken which appeared
to lay the foundations for close cooperation
on international issues. With the acceptance
by Moscow of the doctrine of different roads
to socialism, Tito apparently felt that the way
was open for an orderly relaxation of Soviet
control over the Satellites in which Yugoslavia
could play an important part. Developments
in Hungary, however, placed Tito in an awk-
ward position. While supporting the princi-
pal of national independence, he was con-
cerned lest the pace of developments would
lead to the overthrow of Communism itself.
He has deplored the Soviet resort to force in
Hungary but he has refrained from an open
break with the USSR. He apparently hopes
that Moscow will return to the position which
he believed it had adopted earlier in the year
and which would permit the further develop-
ment of national Communism.
16. Communists in the Satellite countries,
even more than those in the USSR, reacted
to the attempts of the Soviet leaders to relax
controls. Most of the Satellite Communist
leaders were subject to anti-Soviet pressures
within their own parties as well as to wide-
spread anti-Communism among the popula-
tion. Moreover, in most of the Satellites,
living standards had always been higher than
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in the USSR, opportunities for political ex-
pression less restricted, and Communist au-
thority less securely established. In Poland
and Hungary these facts, coupled with a
breakdown in party unity, led to an accelera-
tion of the reform movement to a point where
Soviet interests were endangered, acutely so
in Hungary.
17. By the beginning of November, the Soviet
leaders faced a choice in Hungary between
wholesale repression and the emergence of
an anti-Soviet state which would probably
also be anti-Communist. The latter outcome,
in addition to its adverse effect upon the
Soviet military position in Eastern Europe,
would have severely damaged Soviet prestige
and created an unacceptable precedent for
?the other Satellites. While now relying on
military repression, the Soviet leaders would
undoubtedly like to constitute a new regime
which would not be dependent upon open
Soviet military support but would be able to
establish effective rule and satisfy Soviet re-
quirements. If they are unable to do so, and
if they are also to avoid virtual abandonment
of the Soviet position of Hungary, they will
be forced to undertake prolonged military
occupation in the face of bitter Hungarian
passive resistance.
18. For the present at least, the Soviet lead-
ers have acquiesced to the Gomulka regime
in Poland, but important elements of insta-
bility and uncertainty remain. Recent events
have gtimulated popular hope and expecta-
tions for improved living standards, greater
freedom, broader contacts with the West,
and a reduction of Soviet influence. The
impossibility of soon satisfying all of these
demands, particularly the difficulty of im-
proving the economy, may lead to further
popular unrest or may expose Gomulka to
attempts at a counter-coup by Stalinist ele-
ments. Popular anti-Sovietism and the dan-
ger of outbreaks have been increased, more-
over, by the Soviet repression in neighboring
Hungary.
19. The same basic conflict between Soviet
requirements and popular demands is pres-
ent in the other European Satellites (includ-
ing East Germany) . Divisions within the
other Satellite Communist parties have not
developed to the same degree, nor are there
good candidates in those parties for the role
of Gomulka. Nevertheless, within all these
Satellites popular anti-Soviet feeling has al-
most certainly been increased in the wake of
events in Hungary. The harshness of Soviet
repression and the lack of effective Western
support for the Hungarians will discourage
armed rebellion, but will probably not pre-
vent anti-Soviet agitation and expressions of
discontent.
20. The Kremlin has certainly been engaged
in an intensive reappraisal of Soviet-Satellite
relations as a result of these developments.
The Soviet leaders are subject to conflicting
pressures and are probably still undecided on
an ultimate solution. For the immediate fu-
ture they appear determined not to permit
further relaxation of Soviet controls over the
Satellites. Developments in Poland or a
change within the Soviet leadership might
even lead to systematic repression through-
out Eastern Europe. In the long run, the
forces at work within the Soviet empire will
probably oblige the Soviet leaders to accept
some redefinition of Soviet-Satellite relations
based on reduced Soviet controls.
21. In the aggregate, we believe the Commu-
nist Bloc has been weakened both physically
and psychologically. The military, political,
and economic position of the USSR in the
Satellite area has deteriorated and relations
with Yugoslavia have been strained. The
ideological and psychological leadership of the
USSR has been impaired and the strength of
Communism as an international movement
has been diminished by organizational and
philosophical turmoil.
IV. TRENDS IN THE WESTERN
ALLIANCE SYSTEM
22. The system of interlocking regional pacts
and bilateral arrangements built around the
US and the UK to counter Sino-Soviet power
has lost some of its vitality and cohesiveness.
The North Atlantic alliance, which is by far
the most important segment of this system,
has been declining in vitality since 1954. The
relaxation of tensions following the Summit
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Conference of 1955 took some of the urgency
out of the alliance, and many of its European
adherents began to advance the view that in
its existing form and orientation it was out
of step with the times. The danger of Soviet
military aggression was believed to have great-
ly receded, and the reduced fear of war con-
tributed to a rising popular and parliamen-
tary reluctance to maintain military expendi-
tures for NATO purposes. At the same time,
because of the shift in the arena of conflict
with the USSR to the underdeveloped areas,
some of the NATO members urged that there
should be closer coordination of their policies
toward the areas in question.
23. An immediate effect of the abortive Brit-
ish and French military action in Egypt was
to put new and serious strains upon NATO,
and it stimulated, on the part of many of the
NATO members, a fundamental reappraisal
of NATO and of their respective national
positions. Mutual confidence, particularly
between the US and the UK, was impaired.
There has been widespread criticism in Europe
of the US, the UK, and France. The military
posture of NATO, already weakened by the
diversion of French and British forces outside
Europe, has been further damaged by oil
shortages.
24. Even before the closure of the Suez Canal
and of the IPC pipelines, it appeared likely
that the rate of increase in the industrial
output and foreign trade of Western Europe
would tend to slacken. This slowdown in
industrial growth and trade expansion will
be accentuated by the economic impact of
Middle Eastern developments. In particular,
the British will be hard hit by rising costs
and by the increased dollar drain. If the
canal should be blocked for a prolonged period
or if traffic should be subjected to recurrent
blockages and harassments, these difficulties
would be substantially increased. In any case,
European countries will probably try to free
themselves from dependence upon the canal,
and this will involve time and economic cost.
25. Whatever the outcome with respect to as-
suring the reopening of the canal and un-
inhibited passage through it, it is clear that
the UK's political and economic position in
the world has been further impaired. The
decline of the British position in the Middle
East and of the French position in North
Africa, and the increased bargaining power
of the new and underdeveloped states, fore-
shadows a further decline in the influence of
Western Europe in world affairs. Moreover,
in the longer run, Europe will almost cer-
tainly be faced with permanently higher
prices for oil and a reduced assurance of
ready access to it. The long-run effects upon
the European economy will almost certainly
be adverse and could lead to extensive eco-
nomic readjustments. The effects on the Brit-
ish economy are potentially most serious, but
greater dislocations are probable in France
where the government has been largely in-
capable of overcoming persistent economic
imbalances; Germany, on the other hand is
likely to be competitively strengthened.
26. In addition to their effect upon intra-
NATO relationships and upon Western Eu-
rope's economic prospects, recent events have
profoundly affected Western European think-
ing about the USSR. Soviet willingness to
use force in Hungary, the implied Soviet
threat of attack upon Britain and France
during the Suez crisis, and the continued So-
viet drive for greater influence in the Middle
East have re-aroused Western apprehensions
of Soviet behavior and promoted a renewed
sense of mutual dependence among the NATO
members. On the other hand, Soviet dif-
ficulties in the Satellites, and particularly the
acceptance of the Gomulka regime in Poland,
have stimulated interest in the possibility of
negotiating a gradual withdrawal of Soviet
control in Eastern Europe generally.
27. Much Western European thinking about
the problems and policies of the Atlantic al-
liance is still imprecise and includes contra-
dictory elements. It will be some time before
a clear pattern emerges. In the short term
there is likely to be continuing pressure upon
the principal NATO members to clarify the ex-
tent to which they are prepared to coordinate
policy within the alliance. There will be in-
creased pressure for re-examination of the
military concepts embodied in NATO and of
the problems presented by the growing So-
viet nuclear capability. There will probably
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be a continuing trend toward a closer and
more organized cooperation among the West-
ern European countries. The UK has for
some time been edging closer to the continent
on matters of economic cooperation, and
strong elements in France and Germany are
trying to overcome the differences between
them which have thus far impeded further
growth of the six-nation European commu-
nity. In general the Suez crisis has strength-
ened the political and economic motivations
for closer intra-European cooperation, al-
though formidable obstacles remain.
28. Over the longer run, developments might
lead to arrangements that would replace or
drastically modify NATO. For example, there
has been discussion of subordinating NATO
to a broad European security arrangement
involving Eastern Europe and the USSR. The
potential has long existed for developing new
and broader arrangements designed to assure
security for Western Europe; this potential
has been given impetus by recent develop-
ments. Much will depend upon US and So-
viet policies. If the USSR should give a per-
suasive indication that it might be prepared
to withdraw its forces from Eastern Europe,
the idea of encouraging this process by nego-
tiating for a retraction of NATO is likely to be-
come increasingly attractive. If, on the other
hand, the Soviet leaders should clearly main-
tain a rigid position in Eastern Europe, and
particularly if they should again use military
force in one of the Satellites, Western Europe-
an opinion would probably consider that the
chances were negligible for a substantial re-
vision of security arrangements.
29. Meanwhile, in the Middle East, the Bagh-
dad Pact has been shaken and the Anglo-
Jordanian treaty is virtually dead. The Bal-
kan Pact has been inactive for some time as
a result of Greek-Turkish differences over
Cyprus and Turkish uneasiness over Yugo-
slavia's relations with the Soviet Bloc. There
is greater stability in the Far East, where the
regional and bilateral arrangements are based
essentially upon US, rather than broad inter-
national, support. However, in some coun-
tries in the area there are local forces working
against these arrangements, and they have
not won widespread acceptance and approval
among the free countries generally.
30. In particular, Japan's relationship with the
US is likely to undergo considerable change.
Japan is attempting to achieve a more
independent position in world affairs. In this
connection, the Japanese are becoming res-
tive over restrictions upon trade, both with
Communist China and the US, and they will
become increasingly reluctant to withhold
recognition of Communist China. They will
probably seek changes in the security arrange-
ments with the US, particularly with respect
to US bases and forces. They will probably
seek an agreement that in case of war the
bases would be used only with Japanese con-
currence. On the other hand, the Japanese
still value their close relationship with the US,
they remain distrustful of the USSR, and they
would probably seek US protection if they
thought themselves in danger of an attack
which could not be avoided.
31. Throughout the world, the US will en-
counter increasing difficulty in retaining its
overseas bases on terms assuring their avail-
ability and effectiveness in case of need.
V. PROBLEMS OF UNDERDEVELOPED AREAS
32. The withdrawal of Western authority
from colonial possessions and the reduction
of Western special positions in underdeveloped
areas are trends which seem bound to ac-
celerate. These trends are encouraged by the
readiness of the newly-liberated states of Af-
rica and Asia to lend strong political support
to independence movements and to the various
efforts being made to eliminate the special
privileges gained by Western interests during
the past century.
33. The emergence of new states often has
been accompanied by an intense xenophobic
nationalism which has frequently been cou-
pled with antagonism toward the richer white
peoples of the West. The drive for independ-
ence has also engendered expectations for
political and economic development, social
reform, and a rising standard of living and
culture. In many of these countries semi-
feudal elites are being challenged or displaced
by new nationalist leaders. Almost all the
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governments of these states face severe prob-
lems in achieving political stability and eco-
nomic growth. Some of them are in conflict
with each other over regional interests and
positions. Lack of experience in self-govern-
ment, the shortages of skills and capital, and
explosive population growth will complicate
these problems.
34. Almost all the economies of the states in
underdeveloped areas are heavily dependent,
both in terms of national income and foreign
exchange earnings, on the sale of one or two
primary commodities to the advanced indus-
trial countries. Western imports of primary
commodities from underdeveloped countries
have favored industrial raw materials, while
imports of agricultural products have tended
to lag. Western private foreign investment
in underdeveloped areas has been almost en-
tirely in response to industrial raw material
requirements. Thus, these countries are ex-
tremely vulnerable to shifts in demand, to
changes in the level of economic activity in
the industrial countries, and to fluctuations
in world market conditions.
35. Even under favorable market conditions
for their raw material exports, few of the un-
derdeveloped states have the financial re-
sources required for attaining the economic
development they want. Therefore, most of
them are seeking external assistance to de-
velop their economies and meet the aspira-
tions of their peoples for improved living
standards. A number of these countries are
dependent on external assistance merely to
maintain present standards of living. Since
political stability in the underdeveloped areas
is related to the progress of economic develop-
ment, an increasing number of countries are
likely to accept help from any quarter to
dispose of their products and to develop their
resources.
36. This situation provides an opportunity
for the USSR and a challenge to the US. The
rapidity and broad extent of Soviet scientific
and industrial progress has had a consider-
able psychological impact upon underdevel-
oped countries. The Bloc has achieved con-
siderable capacity for competing with the US
for influence in these areas by economic
means. It has already taken a variety of steps
to this end in the form of loans, technical as-
sistance, sales on attractive terms, and pur-
chases of surplus commodities. The US and
the USSR have different relative advantages
and disadvantages in this competition. The
US disposes greater resources, has superior
technical knowledge in light industry, and
more experience in providing assistance to
underdeveloped areas. The USSR tends to
benefit by the vulnerability of these countries
to economic trends in the West and by its own
capacity to absorb their surpluses into the
Soviet economy. Moreover, in many of these
underdeveloped countries, as in the USSR,
there is a high degree of governmental par-
ticipation in the economy, a circumstance
which facilitates government-to-government
trading. Thus far the USSR has gained pres-
tige through the psychological impact of its
initial and comparatively small efforts, but
this prestige is unlikely to be sustained unless
followed by continuing and larger increments
of trade and assistance. The Bloc has the
capability of doing this.
37. Despite such increased trade and assist-
ance as these underdeveloped countries may
obtain from the West, or from the USSR, there
will probably be a rising political tension in
many of these areas. This will derive not only
from economic problems and unsatisfied ma-
terial expectations, but from the widespread
aspiration for self-government and national
recognition, from racial tensions, and from
problems of national cohesion.
38. The Middle East. The most important
developments of the last two years in the
Middle East have been the rise of Nasser as
leader and symbol of renascent Arab national-
ism and the Soviet initiative in exploiting this
nationalism. The force of Nasser's example,
coupled with energetic propaganda and pros-
elytizing efforts, has enabled him to capture
the imagination of the discontented Arab
masses in the cities and refugee camps and to
seize the leadership of revolutionary elements
in their developing struggle against tradition-
al elites throughout the Middle East. Young
officer groups patterned on the Egyptian
Revolutionary Command Council have already
achieved dominant positions in Syria and Jor-
SECRET
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dan, and widespread civilian opposition to the
status quo exists beneath the surface in Iraq,
Iran, and other countries. Nasser has even
been able to win support from King Saud,
the Imam of Yemen, and various other rep-
resentatives of the old political order in the
Arab world by virtue of his taking the lead
in Arab opposition to Israel and to continued
British and French dominance in the Arab
states and North Africa, his ability to play
on personal, group, and national rivalries in
the area, and the apparent success of his
policies.
39. The willingness of the USSR to supply
arms, economic aid, and diplomatic support
has for the first time enabled non-Communist
Arab nationalists to look abroad for effective
help in their efforts to eliminate special West-
ern privileges and to settle scores with Israel.
The Egyptian leaders, though themselves non-
Communist and desirous of avoiding subjec-
tion to Soviet control, have accepted Soviet
assistance and support and have encouraged
Syria and others to do likewise. The actions
of Nasser and his imitators have evoked wide-
spread approbation throughout the Arab
states. Even those conservative and moderate
nationalist leaders who are alarmed by his
provocative tactics have felt unable to oppose
him. As a result, the last two years have
witnessed a sharp decline in Western influence
and in the position of political elements dis-
posed to cooperate with the West, such as the
Null Said regime in Iraq. Although the
USSR has made notable gains in parts of the
Arab world, the US has also won at least a
temporary increase of prestige through its
initiative at the UN. The Egyptian and
Syrian leaders, and some elements in the
other states as well, will probably strive to
attain an independent position by developing
ties with both the US and USSR and to pre-
vent either from achieving a predominant
position.
40. The Israeli invasion of Egypt and the
Anglo-French attempt to seize the Suez Canal
have further inflamed Arab national sensi-
tivity, and have virtually destroyed the in-
fluence of the French and gravely impaired
that of the British in the Arab world. The
8
states of the area face a period of increased
uncertainty and turbulence. It is a question
whether governments with a fair degree of
stability and a willingness to show reasonable
regard for Western economic interests can
soon emerge. This in turn depends in large
degree on the appearance of leaders who,
though nationalist, are courageous enough to
oppose extremist political elements and at the
same time able to satisfy the aspirations of
their people for independence and economic
progress. In any case, the existence of Israel
will continue to be a basic irritant, and it will
be some time before Arab leaders feel able to
abandon a violent anti-Israeli position and to
negotiate a settlement of outstanding Arab-
Israeli issues.
41. Non-Communist Asia. British influence
in the Asian Commonwealth countries has
suffered a serious blow as the result of mili-
tary intervention in Egypt. Although the
present leaders in these countries probably
will not sever their British ties, the concept
of the Commonwealth as a bridge between
the European and Afro-Asian countries and
peoples has been weakened. India will con-
tinue to exert a neutralist influence through-
out the area and there is little prospect of
any marked change in India's foreign policies
so long as Prime Minister Nehru remains
politically active. The Kashmir dispute will
continue to disturb Indian-Pakistani rela-
tions, although a resort to arms seems un-
likely. In both countries, economic difficul-
ties are serious, and development plans are
unlikely to be fulfilled without large incre-
ments of external aid.
42. The Asian countries allied with the US
have attained modest success in building their
military and economic strength, but their
stability will remain heavily dependent on
continued US assistance. Most of these coun-
tries ? particularly Thailand, Pakistan, and
the Philippines ? will display increasing na-
tional sensitivity in their relations with the US
and seek a greater voice in US programs af-
fecting them, but they probably will continue
to support the US lead on international policy.
Over the long run, the international position
of the Chinese Nationalists will almost cer-
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tainly continue to decline, and their will and
ability to maintain their position on Taiwan
rests on US guarantees and assistance.
43. The Southeast Asian governments will
continue to be confronted by deepseated po-
litical, racial, and social problems ? including
the presence of large overseas Chinese com-
munities of uncertain loyalties ? which are
likely to prevent any rapid improvement in
their stability. These internal difficulties will
be compounded by the rapid economic growth
and increasing influence of Communist
China. Throughout non-Communist Asia,
there is a growing realization that Communist
China is now the major Asian power and a
feeling that it would be wise not to defy
Peiping or to rebuff its overtures.
44. Africa. Except in North Africa, national-
ist movements in Africa are not as advanced
as in the Middle and Far East. In Tropical
Africa, relations between the existing colonies
and dependencies and the European metro-
poles are likely to be transformed in varying
ways and degrees over the next decade. Par-
ticularly in areas under British control, and
to a lesser degree in French Africa, there is
likely to be a rapid emergence of new native
states. If the European powers implement
liberal colonial policies, they probably still
have sufficient time to exert a moderating
influence on nationalist movements, but in
any case they will have to contend with Soviet
and Egyptian efforts to exploit racial tensions
and to channel nationalism in an anti-West-
ern direction.
45. In North Africa, the problems are more
urgent. The Algerian revolt continues, and
the French position has been further weak-
ened by events in the Middle East. Sooner
or later, the French will be obliged to grant
virtual independence to the Algerians, and
so long as they refrain from doing so their
relations with Tunisia and Morocco will be
under severe strain. The three North Afri-
can territories will presumably remain heavily
dependent upon France in economic matters,
and although they will make efforts to reduce
that dependency, there will be a continuing
need to retain some ties with France. Never-
theless, the present moderate leadership in
9
Tunisia and Morocco is under great pressure
from radical elements to diminish these ties.
The continuance of fighting in Algeria poses
a threat of a spread in the conflict over the
entire area.
46. Latin America. US prestige in Latin
America is high despite nationalist pressures.
Economic development, generally abreast of
population growth, will probably continue to
be more rapid than in other underdeveloped
areas. Unrest arising from the development
process and from the failure to meet increas-
ing popular expectations will be serious in
some countries, but will not in itself pose a
serious challenge to the US position. Latin
America will almost certainly continue to
support the ITS in its relations with the Soviet
Bloc. Nevertheless, Latin Americans will al-
most certainly resent the continued subordi-
nation of economic assistance to Latin Amer-
ica to what the US regards as the more urgent
problems of other areas.
VI. LIKELIHOOD OF WAR
47. In the situations existing in Eastern Eu-
rope, the Middle East, and elsewhere, it is
apparent that conflicts could break out in
which the great powers could become directly
or indirectly involved. We continue to be-
lieve that the USSR is unlikely deliberately
to initiate general war. However, the risk of
war coming through miscalculation continues
to exist, and the opportunities for such mis-
calculation have been increased in the un-
stable situation resulting from recent events
in Eastern Europe and the Middle East.
48. The situation in the Satellites, and par-
ticularly in East Germany, poses such a po-
tential danger. If open revolt again broke
out in Eastern Europe, the sensitiveness of
the USSR to any Western moves would be-
come acute. For example, if an outbreak
should occur in Poland, it would increase the
already existing chance of an uprising in
East Germany. Should the latter occur, there
might be spontaneous efforts by the West
Germans to aid the East Germans. In the
Berlin enclave there would be danger of clash-
es between Western and Soviet forces as the
latter moved to prevent West Berlin from be-
coming a base for supporting the rebellion.
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49. There would be a large number of vari-
ables in any such situation, and these vari-
ables open the way for mistakes and miscal-
culations which could convert an uprising into
an international conflict. Nevertheless, we be-
lieve that ? even if the potential for revolt
should flame into actuality ? the principal
powers will make a major effort to prevent
the development of a general war, or even a
large-scale local conflict. NATO and the gov-
ernments of the US and West Germany have
indicated strongly that they would not inter-
vene with force in the Satellite area. The
USSR, confronted with its own internal prob-
lems and with widespread hatred among Sat-
ellite populations, has every interest in pre-
venting even a large-scale local conflict from
developing. Recent events have not basically
altered the over-all strategic situation, and
the Soviet leaders almost certainly continue
to believe that the danger to Soviet survival
remains great if general war comes.
50. We cannot exclude the possibility, how-
ever, that the Western governments might
take steps which appeared to the USSR to
portend active exploitation of rebellion. Such
steps might take a form which, together with
other related pressures such as domestic dis-
turbances, might cause the Soviet leaders to
feel that the security of their regime was at
stake and to assume the risks of a wider
conflict.
51. Outside of Europe, the most obvious
threat to peace lies in the still unresolved
conflicts in the Middle East. Issues such as
those concerning the Gaza strip, the Suez
Canal, the Israeli frontiers, and the status of
Syria and Jordan are likely to continue for
some time. Moreover, the proclivity of the
various Arab states for interfering in one
another's internal affairs, social and political
pressures within the Arab states, the con-
genital weakness of their governments, and
the added stresses generated by Soviet activi-
ties, all contain the seeds of conflict.
52. As a result of Soviet efforts to exploit
such situations, already exemplified by Mos-
cow's provision of arms and diplomatic sup-
port to Egypt and Syria, local conflicts in the
Middle East will increasingly involve West-
10
em and Bloc interests. In the event of an
actual outbreak of local hostilities, the USSR
would probably be prepared to extend con-
siderable support in order to prevent the
downfall of those Arab leaders aligned with
it. However, the USSR would almost cer-
tainly seek to avoid going so far as to incur
serious risk of general war. In addition, it
is probable that there would be strong pres-
sure in the UN to halt any conflict which
might break out and threaten to expand into
general war.
53. In the Far East, relative stability exists
despite unresolved disputes, largely as a re-
sult of US commitments to governments in
especial danger. Although Communist China
remains determined to obtain Taiwan and
will continue to seek to extend its influence
in other non-Communist areas of Asia, it will
probably refrain from overt military opera-
tions to attain these ends so long as it be-
lieves that such action would involve a serious
risk of war with the US.
54. The United Nations, by its actions in the
Suez crisis, has enhanced its standing as an
instrument for preventing, halting, or limit-
ing international conflicts. For example,
when a country is prepared to compromise
rather than to fight, the UN will provide a
means of doing so with less loss of prestige.
In most cases, however, the UN will probably
be able to halt fighting only when the US and
the USSR are agreed on such an outcome.
The smaller powers will almost certainly con-
tinue to use the UN as a means of bringing
pressure upon the greater powers on ques-
tions of colonialism and world peace.
55. Wherever unresolved conflicts exist, wher-
ever populations are caught in or are exploit-
ing the differences between the great powers,
or wherever people are simply trying to assert
their own independence and national aspira-
tions, there are potentialities for the develop-
ment of local conflicts which could spread
more widely. In all of them there is the
possibility of Soviet or Chinese Communist
involvement. We believe that it will gener-
ally be the policy of the Soviet and Chinese
Communist leaders to avoid a direct conflict,
_fgetisitomplik
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to shift the arena of conflict from one area
to another when effective resistance is encoun-
tered, and to continue to build up strength
and to cultivate an appearance of invinci-
bility. Only if they believed that Western
courses of action, if not countered, would
threaten the survival of their regimes would
the Soviet and Chinese Communist leaders
deliberately undertake extreme risks of major
war.
gitealnia
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? ,445CRIU.'
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