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3 April 1951
3.5(c)
Copy No. C.:J. -e,
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CURRENT INTELLIGENC~ BULLETIN t!"J

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• 3.5(c)

3.5(c)

Office of Current Intelligence

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CENTRAL INTELLIGENCE AGENCY

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- SUMMARY

- GENERAL

1. Gromyko reported anxious to proceed with CFM negotiations (page 3) •

• 2. British seek solution to Iranian oil problem (page 3).

3. Steel rails from France find way to Communist

, China (page 4).

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- NEAR EAST

3.3(h)(2)
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. EASTERN EUROPE

5. USSR ships grain to Czechoslovakia in excess of Czech needs (page 5) •

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• LATIN AMERICA

• 6. Violence breaks out· in Ecuador (page 6) .

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- GENERA l
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1. Gromyko regortecL.f:.nxious to prQ£Q.~Q.JY.il!t.QFM negotiati ons:
3.3(~)(2)
US de legate Jessup reports an impressi on \
• received at an informal four=pow er meefing

- that Soviet delegate Gromyko is very anxious

to have some v:restern draft agenda in writing
which he could submit to Moscow. Jessup also reports his impressi on
that, when no W'estern draft was forthcom ing in response to the 28 March
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proposal of the USSR? Gromyko was instructe d to introduce the Atlantic
Treaty item in order to countera ct any impressi on of Soviet weakness
and unlimited concessio ns. Gromyko also manifest ed interest in whether
• the first Soviet agenda item would be acceptab le if reworded so -as to
show that "German demilitar ization" could be either a cause or an
effect of present internatio nal tensions in Europe.
C,omment: The Western Powers planned
• to introduce a revised version of their draft agenda at the 2 April .
meeting of the delegates , Groinyko 's reported attitude may be indica-
. tive of his apprehen sion that the Soviet Governm ent is not satisfied
either with his conduct of the negotiati ons or with their progress o

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2. British seek solution to Iranian on problem~
The US Embassy in London ireports that
UK Governm ent officials are now genuinely
• alarmed over the prospect s of losing British
J investme nts in Iran and oil supplies consider ed
Ill
vital to the British economy . The Foreign Office regards more liberal 3.3(h)(2)
financial terms to Iran as necessary ~ and is pressing the Anglo-Ir anian
Oil Company in th.at direction . lt also recogniz es that British policy
• must at least pay lip service to the principle · of nationali zation. At the
same time, however~ the Foreign Office thinks the :relinquis hing of the
ii title to the oil propertie s would ,be dangerou s and continues to believe
that negotiati ons with Iran will be useless until a strong governm ent has
come into power. The Foreign Office has further indicated that if efforts
• at persuasio n in Iran are unsucces sful~ it is prepared to consider pres-
sure~ beginning with financial measu:ires and possibly J if British lives
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- the oil pro per tie~ ex-

wer e end ang ered by a thre aten ed s~i.zure of nea rby bas e in lraq o
tend ing to the tran sfer of Bri tish troo ps to
a
✓

-. Meanwhile,; the For eign Office is atta chin g

gre at imp orta nce to high leve l US- UK talk s
to beg in in Was hing ton on 9 Apr il 9 and has
on the sub ject sch edu led
exp and ed the UK dele gati on
ry and the Min istr y of Fue l
to incl ude rep rese ntat ives from the Tre asu
orta nce to Bri tain of Iran ian
and Pow er in an effo rt to emp has ize the imp
• oil and of US sup por t on this issu e.
Comment~ The Bri tish For eign Office will
II an Oil Com pan y to agre e to
find it diff icul t to pers uad e the Ang lo-I rani
the nati ona liza tion of the
pro pos als that would eve n pay lip serv ice to
e is littl e like liho od of
• Iran ian .oil indu stry . At the pre sen t tim e ther with which the Bri tish
ent
the eme rgen ce of a stro ng Iran ian Gov ernm the Bri tish beli eve
r how
cou ld neg otia teo In add ition 9 it is not clea
Iran ian Gov ernm ent with -
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they cou ld effe ctiv ely exe rt pre ssu re on the
an exte nt that a sett lem ent
out infl ami ng Iran ian pub lic opin ion to such
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sati sfac tory to the Bri tish cou ld not be reac
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3.3(h)(2)
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• mun ist Chi na:
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3o Stee l rail s from Fra nce find way to Com -it.- ✓
ii Acc ordi ng to info rma tion fromA US Em bas -
sies in Bru sse ls and Par is~ a rece nt ship -
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men t to Com mun ist Chi na thro ugh Ant wer p
• of 2)500 met ric tons of Fre nch stee l rail s v'

is pro bab ly par t of an ord er tota ling 16~000

3(h)(2)
• tons of rail s and 480 tons of fitti ngs osten-3.
sibl y for deli very to Venezuelao The US
. Em bas sy in Par is sur mis es that the fund s
this tran sac tion orig inat ed in the Sov iet sec
tor of Ber lin. U dou bts
mat e des tina tion of the
for
that
the Fre nch Gov ernm ent was awa re of the ulti init ial Fre nch pur cha sers
- shipm:ent alre ady forwarded~ inas muc h as the
acte d thro ugh a Lic hten stei n firm and th?. fina
ncin g was han dled by a

- Swi ss ban k.

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- Comment~ In Janua:ry 1951~ as the result

of urgent US representations, the French Gover11-ment prohibited further
licenses for the export of any steel products to Communist China. While
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no steel rails for China had been manufactured at that Ume, orders for
over 28,000 metric tons of other steel products had already been filled •
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NEAR EAST

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EASTERN EUROPE
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5. USSR ships grain to ~zechoslovakia in excess of Czecb neads" /
• On 15 March, Czech President Klement 3.3(h)(2)

- Gottwald stated at a meeting of the Central

Committee of the Czech Communist Party

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that the USS ~hip 155,000 metric tonij of bread grain to Czecho -
- slovaki a before the end of May and 600,00() tons more before the next
harvest "
3.3(h)(2)

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• LATIN AMERICA

6. Violenc e breaks out in Ecuado r:

• During a 31 March parade of students?3.3(h)(2)
laborer s and leftist politica l parties
• in Quito, a crowd attacke d mounte d police
with stones. The police in turn fired on
the cr6wd, killing two people and wounding
• fifteen. Although the US Embass y in
Quito has reporte d that the demons tration
1111
was probabl y a peacr-ful nr:tes: ;.a:nst
mishand ling of earthqu ake reconst ruction funds~ L )3.3(h)(2)
c-==~= == some of the rioters may have been associa te wi a.~c1 st- (
• inclined politico -militar y faction (the Guevar a group) which has been
plannin g the overthr ow of the governm ent for some time. The pre.,.
sidentia l palace has reporte dly been placed under heavy ~~med guard,
• and the streets are now patrolle d by the army and police.
Ill Comme nt: There i$ evidenc e that the 3 3(h)( 2 )
alliance between the two most powerfu l revoluti onary factions in Ecua- ·
dor (the followe rs of Guevar a and those of the Liberal .-Radic al leader
Mancheno) has been strength ened in the past few months? but it is
doubtful that this alliance has sufficie nt strength to overthr ow the
- governm ent at this time.

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