SINO-SOVIET BLOC ECONOMIC ACTIVITIES IN UNDERDEVELOPED AREAS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP92B01090R000700010055-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 6
• Document Creation Date: December 16, 2016
• Document Release Date: August 9, 2005
• Sequence Number: 55
• Publication Date: March 17, 1958
• Content Type: REPORT

Approved For Release 2005/08/22: CIA-RDP92BO1090RO001005Q,
Copy QO,J0 N . bb1
SECRET
25X1
BIWEEKLY REPORT
S1NO - SOVIET BLOC
ECONOMIC ACTIVITIES
IN UNDERDEVELOPED AREAS
EIC-WGR 1155
17 March 1958
PREPARED BY THE WORKING GROUP
ON SINO-SOVIET BLOC ECONOMIC ACTIVITIES
IN UNDERDEVELOPED AREAS
ECONOMIC INTELLIGENCE COMMITTEE
25X1
SECRET
Approved For Release 2005/08/22 : CIA-RDP92BO109OR000700010055-0
 Approved For Release 2005/08/22 : CIA-RDP92BO109OR000700010055-0
SECRET
WARNING
THIS MATERIAL CONTAINS INFORMATION AFFECT-
ING THE NATIONAL DEFENSE OF THE UNITED STATES
WITHIN THE MEANING OF THE ESPIONAGE LAWS,
TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS-
SION OR REVELATION OF WHICH IN ANY MANNER TO
AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
These biweekly reports on "Sino-Soviet Bloc Economic Ac-
tivities in Underdeveloped Areas" are prepared and issued
by a Working Group of the Economic Intelligence Commit-
tee, including representatives of the Departments of State,
the Army, the Navy, the Air Force, Commerce, and Agricul-
ture; the International Cooperation Administration; the
Office of the Secretary of Defense; and the Central Intelli-
gence Agency. Their purpose is to provide up-to-date fac-
tual information on significant developments in the eco-
nomic relations of Sino-Soviet Bloc countries with under-
developed countries of the Free World. The EIC-R-14 series
of reports, under the same title, provide periodic summaries
and analytical interpretations of these developments.
Printed and Disseminated by the
Central Intelligence Agency
SECRET
Approved For Release 2005/08/22 : CIA-RDP92BO109OR000700010055-0
 Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
S-E-C-R-E-T
Summary of Events
28 February - 13 March 1958
India is considering Soviet and Rumanian offers of economic and
technical assistance for the construction of two oil refineries, These
refineries will cost about $70 million. Rumania. and the USSR pre-
sumably would extend loans to cover foreign exchange requirements,
which will represent about one-half of the total cost of the refineries.
Ceylon has accepted an offer of a $10. 5-million loan from Communist
China. These two events constitute the most important developments
affecting the economic relations between the Sino-Soviet Bloc and under-
developed countries of the Free World during the period 28 February -
13 March 1958.
Also of special interest is the decision of Egypt to lower its ex-
change rate in such a way as to stimulate sales of cotton to Western
buyers. The new Egyptian foreign exchange system, under which the
Egyptian pound will be sold at a discount to qualified exporters, is
apparently designed to redirect part of Egypt's trade and to lessen
Egypt's dependence on the Soviet Bloc for the marketing of its cotton
Also in the Middle East, representatives of the Polish Factory Export
Organization and a private Iranian firm signed a contract for the con-
struction in Meshed of a sugar mill worth $3, 187, 000.
An agreement between Afghanistan and the USSR calling for about
$12 million of Soviet aid for the construction of the Salang Pass road
and tunnel was recently signed in Kabul. The completion of this project
will shorten the route from the Soviet frontier to Kabul and increase its
capacity.
A nongovernmental trade agreement between Japan and Communist
China was concluded in March in Peking between a private Japanese
delegation and Chinese Communist representatives. The agreement,
which provides for an exchange of permanent, resident trade missions
and for direct banking relations, calls for $98 million in trade each
way during the coming year. Another nongovernmental agreement,
Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
 Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
signed in February by Japan and Communist China, calls for a total
of $280 million trade each way over the 5-year period 1958-62. This
agreement provides for an exchange of Japanese steel products for
Chinese Communist iron ore, coal, and other products. It is likely
that the Japanese government will encourage an actual growth of trade
by implementing the technical requirements of the agreements -- that
is, by the issuance of export and exchange permits. The Japanese
government, however, probably will seek to avoid direct political in-
volvement, such as would be entailed in any formal governmental
approval of the agreements, particularly the agreement of 5 March
1958.
An official Argentine trade mission composed of representatives
of state monopolies and state-owned industries visited six Soviet Bloc
countries beginning in mid-January. On the return of the mission
its head announced that contr:actsval.ued"at $27 million.ha.dbeen con-
cluded and that other contracts were pending.
Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
 Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
S-E-C-R-E-T
CONTENTS
Page
1. Soviet and Rumanian Offer to Construct Oil
Refinery in India . . . . . . . . .
2. Approval of East German Assistance in Estab-
lishment of Indian Raw Film Plant . . . . .
B. Acceptance by Ceylon of Chinese Communist Offer
of $10. 5 -Million Loan . . . . . . . . . . . . .
C. Status of Afghan Airfield and Road Projects Under
Soviet $100-Million Loan . . . . . . . . . . .
II. Southeast Asia . . . . . . . . . . . . . . . . . . . 3
A. New Trade Agreement Between Burma and Com-
munist China . . . . . . . . .
B. Communist China's Exchange Earnings from Hong
Kong and Malaya in 1957 . . . . . . . . . . .
III. Far East (Japan - Communist China Trade Agreement) . 5
IV. Middle East and Africa . . . . . . . . . . . . . . . 7
A. Impact of New Egyptian Foreign Exchange System
on Egyptian Economic Relations with the Soviet
Bloc . . . . . . . . . . . . . . . . . . . 7
B. Polish Contract for $3-Million Sugar Mill in
Iran . . . . . . . . . . .. . . . . . . . . . . 8
Latin America (Return of Argentine Trade Mission to
the Soviet Bloc) . . . . . . . . . . . . . . . .
Approved For Release 2005/08/22 : CIA-RDP92B01090R000700010055-0
 25X1 Approved For Release 2005/08/22 : CIA-RDP92BO109OR000700010055-0
Next 10 Page(s) In Document Exempt
Approved For Release 2005/08/22 : CIA-RDP92BO109OR000700010055-0