PHILIPPINES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R00890A001000080034-1
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 2
• Document Creation Date: December 12, 2016
• Document Release Date: June 24, 2002
• Sequence Number: 34
• Publication Date: December 22, 1958
• Content Type: BRIEF

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N SC BRIEFING
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popular opposition to Prereident Garcia growing an result of
corruption and failure of his administration to stem economic
drift.
A. Garcia booed by crowd of 40 gOOO at Manila sports event last welt.
B. Efforts to stage triumphal welcome on his return 6 December
from good-will tour of Japan were greatly overshadowed by
later reception given returning Nacionaliata party an
Senate president Rodrigues.
1. Rodriguez repaetedly has offered to head an anti-Garcia
wing of the Nacionalists party.
2. Garcia accused of being "taken in" by lavish treatment
Japanese gave his.
II. serious financial problems still plague the government.
A. Budget commissioner told congressional hearing that Philippine
was on verge of bankrruptcy; exchange reserves dipped to new
low in November.
Heavy pressure continues for peso devaluation, but Garcia
remains opposed.
1. recently told Philippine businessman he feared
psychological effect of devaluation would load to strikes
and near anarchy.
III. Garcia apparently still plane to place more trusted non
control of armed forces even though rumors of a military coup
have abated.
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 Approved For Release 2Q 8rT2 CIA-I DP79R0089OA001000080034-1
. He in reported to have picked a loyal iaci.on*lieta
an to replace Defense Secretary Vargas, possibly
a broader cabinet reshuffle in early 1959.
Retirement under pressure of Armed Forces Chief AArelisno
scheduled for 31 December, is expected to pave way for
further
Revel shifts among army and constabulary
officers.
Capt. Albert, armed forces Intelligence chief, apparently
also on way out.
D. Present military leaders have maintained that pacionalista
seeking party control of the army for future
tiona are behind the "coup" rumors and prospective changes.
IV. At:same timee, Philippines is displaying hardening attitude in
its demands for greater American military aid, and for revision
the bases agreement; there are also, renewed complaints
ve-r the trade agreement With the U. Vii.
A press campaign,, presumably Officially inspired, on
behalf of the Philippine stand in the present exploratory
fasten talks may be designed to force American concessions
uld bolster Gera a's prestige.
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