Foreign Relations of the United States, 1958–1960, American Republics, Volume V

122. Special National Intelligence Estimate¹

SNIE 80–59

Washington, June 30, 1959.

THE SITUATION IN THE CARIBBEAN THROUGH 1959

The Problem

To estimate the prospects through 1959 for political stability in the Caribbean republics, with particular reference to Communist strength and influence in Cuba and among the revolutionary groups of exiles from Nicaragua and the Dominican Republic.

Conclusions

1. In Cuba, Fidel Castro achieved immense popularity through his leadership in the overthrow of the Batista dictatorship, a popularity which since has been decreasing. His temperament and inexperience ill fit him to administer the government. He is inspired by a messianic sense of mission to aid his people and draws upon the common stock of Latin American reformist ideas, but he has little sense of the practical consequences of his impulsive attitudes and actions. (Paras. 10, 12–13)

2. The Communist Party in Cuba has at various times been and is again one of the strongest in Latin America. With great skill, it has succeeded in identifying itself with the Castro revolution, and is exploiting the confusion and ineptitude of the Castro administration to penetrate the bureaucracy, the army, organized labor, and the organization set up to carry out the agrarian reform. The Communists probably do not now control Castro, but they are in a position to exert influence in his regime and to carry on further organizational work. We believe that at least for the period of this estimate the Communists will continue to support Castro’s program and will attempt to avoid giving Castro any cause for believing that they are seeking to usurp his position as leader. We, therefore, believe that Castro is unlikely to take the drastic steps necessary to check their increasing power. (Paras. 14–15, 17–18, 21, 24–25)

3. The trend of developments in Cuba has alienated elements in the upper and middle classes and the Catholic Church, including many who originally supported Castro. His agrarian reform law has aroused substantial opposition even among smaller Cuban landowners. There is also some dissatisfaction in the military and to some extent in the rebel movement itself. Exile groups abroad are plotting. Although opposition is on the rise, Castro continues to enjoy wide popularity. While moves to overthrow the regime are possible, it is unlikely that dissatisfied elements either separately or together will challenge him successfully during 1959. (Para. 23)

4. Castro is concerned that his radical actions, especially agrarian reform, could cause the US to modify Cuba’s preferential treatment in the US sugar market. However, should he believe that the US Government or private interests were exerting pressures to bring about a modification of his policies, he would probably react strongly. It is possible that Castro would threaten to demand the US withdrawal from its naval base at Guantanamo or threaten the expropriation of other large US holdings. (Paras. 20–22)

5. Castro’s revolution in Cuba has greatly stimulated revolutionary activity throughout the Caribbean area, particularly among exiles from Nicaragua, the Dominican Republic, and Haiti. Initially Castro made the overthrow of dictatorship throughout Latin America a part of his program. Lately, he has realized the advisability of publicly adhering to the doctrine of nonintervention as a protection for the revolution in Cuba. Nevertheless, we believe he will continue to assist revolutionary exile groups in Cuba to invade their respective homelands. (Paras. 11, 28–29)

6. The Somoza regime in Nicaragua is currently threatened with attack from exiles who have intermittently invaded Nicaragua in small groups. The danger to the regime is primarily psychological; it is less a function of the capabilities of any particular opposition group than of a spreading conviction that the Somozas’ time is running out. Should non-Communist opposition elements prove incapable of bringing about an early change in government, anti-US and pro-Communist elements will probably gain increasing influence in the revolutionary movement and in any successor regime which it might set up.² (Paras. 40–47)

7. We believe that even though the Somozas have survived the recent invasions, their chances for retaining power are diminishing. They probably would be able to prolong their tenure if they were willing to make significant concessions to the opposition—a course which they have thus far been disinclined to follow. However, we believe the Somozas will remain in power at least for the period of this estimate.³ (Paras. 48–49)

8. The 30-year Trujillo dictatorship in the Dominican Republic is being challenged for the first time. It is nevertheless probable that the regime will be able to survive through 1959. The possibility remains that failure to eliminate invasion groups will stimulate internal opposition within the country and that the combination of these two forces might cause the military to defect and the regime to topple before the end of 1959. The possibility exists that Trujillo will make good his threat to retaliate with air attacks on Cuba if an invasion supported by the Cuban Government invades his country, and thus create a war situation in the Caribbean area. (Paras. 37–39)

9. The internal political situation in Haiti is precarious. Governments in Honduras and Panama are unstable. The Governments of Guatemala, El Salvador and Costa Rica are not immediately threatened. We believe that all the above governments will survive through 1959, with the possible exception of Haiti. (Paras. 32–34, 36, 50–51)

Discussion

I. Introduction

10. Fidel Castro’s victory freed Cuba from Batista’s corrupt dictatorship. It also opened the way for social, economic, and political reform. Castro’s objectives are to bring about a social revolution including the reduction of power of the wealthy, both Cuban and foreign, and the improvement of the lot of the poorer classes. However, he is ruling as a dictator stating that democratic government is to be reestablished, but that it must be delayed until the major economic and social reforms have been successfully launched. The most dangerous aspect of this situation of radical change is the opportunity which it gives to the Communists, for they can consolidate their position by vigorously supporting Castro’s programs.

11. Castro’s victory has also given a new impetus to the groups seeking to overthrow the dictatorial regimes in the Dominican Republic, Nicaragua, and Haiti. His success has been of particular importance because it demonstrated a method whereby a small group of determined men could win, and because it showed that widespread popular support could be generated for a sweeping social and economic revolution. Castro’s call for a radical change in the old order within the Caribbean area, coupled with his affinity for extremist revolutionaries, has increased the Communist potential throughout the area.

II. The Situation and Outlook in Cuba

A. The Present Situation

12. The Character of Castro and His Regime. Fidel Castro achieved immense popularity through his leadership in the overthrow of the Batista dictatorship, a popularity which since has been decreasing. He is inspired by a messianic sense of mission to aid his people and draws upon the common stock of Latin American reformist ideas, but he has little sense of the practical consequences of his impulsive attitudes and actions. Furthermore he appears unwilling to tolerate disagreement with his policies and labels any dissenter a counter-revolutionary.

13. Castro’s regime has functioned in a highly unpredictable manner. In part this is the result of the collapse of the former governmental structure and the inexperience of his followers. But to a greater extent this probably stems from the fact that he has retained decision-making in his own inexperienced hands. The regime has devoted much effort to punishing all persons in and out of government whom the revolutionaries class as Batista supporters. It has also put into effect drastic measures which were designed to weaken the position of the wealthy and the middle class and to improve conditions of the lower classes. Some of these may have a beneficial effect in the long run. However, they have been introduced in an erratic manner and have put new strains on an economy which was already suffering from the effects of the prolonged civil war.

14. The Communist Party. The most dangerous aspect of this situation has been the opportunity created for the Cuban Communist Party (Popular Socialist Party—PSP) to improve its position. This well organized party has at various times been and is again one of the strongest in Latin America. By the end of Batista’s regime in late 1958, the PSP had been reduced to an estimated 8,000–12,000 members. Nevertheless, even during the Batista dictatorship, it was active in the fields of labor, education, and entertainment. Although the PSP as a party did not support the Castro movement until its success was imminent, it has since January given solid support to Castro’s program of purging Batista men and of social and economic reform. It has also actively sought to increase its membership and influence. Since Batista’s overthrow PSP strength has increased, and today it may be as high as 17,000.

15. The Government. The civilian government, severely purged after Castro’s victory, is still in a state of disorganization. Manuel Urrutia remains a rubber-stamp President. The cabinet includes an ultranationalist, a few moderates, and a number of political unknowns; recent changes in the Cabinet’s makeup may have reduced its competence. In general its influence on Castro seems secondary to that of his extremist advisers from among his comrades in the 26th of July Movement. A large part of the former bureaucracy has been replaced by inexperienced adherents of Castro’s movement and in certain cases by known Communists or persons amenable to Communist influence, including some at high levels.

16. The Military. The regime has attempted to insure the loyalty of the army by the mass integration of 26th of July Movement forces into its ranks, by the dismissal of many former army troops, and by the execution or imprisonment of many professional army officers. Therefore the new army, though lacking in effective organization as a military establishment, is probably loyal to Castro. The air force is undergoing a purge and the navy has lost many of its experienced high level officers. The loyalty of both services to the regime is doubtful, and their capabilities have been considerably reduced.

17. There are a number of Communists or Communist sympathizers in the military forces, some of whom hold key spots. Castro’s brother Raul, who is strongly sympathetic to communism, commands the armed forces. Major Ernesto “Che” Guevara Serna, a key figure in the revolution who now commands Havana’s most important military installation, has consistently furthered Communist interests. Other high ranking officers probably are Communists or Communist sympathizers. Communists have penetrated the lower echelons of the new army. All members of the armed forces are being subjected to a political indoctrination program in which the Communists have important influence.

18. Organized Labor. Castro has moved to establish control of organized labor. This force was politically powerful even under Batista and gave little support to Castro until the dictator fled. At that time a group of rebels and a minority of five Communists seized the directorate of the national labor confederation. Subsequently Castro, to insure his control of labor, reorganized the directorate and excluded the Communists. Furthermore, in recent local union elections, his movement won almost all leadership positions. Although most Communist contenders were defeated, it is probable that some Communists won as candidates of the 26th of July Movement. Moreover, it is likely that some of the non-Communist but relatively inexperienced Castro followers are amenable to Communist influence. There are also Communists in the rank-and-file and lower leadership echelons of labor, and they enjoy certain advantages from their long years of experience in the labor movement. Thus, despite Castro’s efforts to develop a labor movement responsive to his leadership, the Communists have been able to retain a strong position.

19. The Economic Situation. While the Cuban economic situation is not yet critical, it has deteriorated and holds potential for Communist exploitation. With labor’s cooperation, the sugar industry, despite the late start in the grinding season, has reached the 1959 quota.⁴ However, a lower world sugar price has contributed to a reduction in the island’s income. Other sectors of the economy have registered slight gains since the initial dislocations accompanying the revolt. They continue to suffer as a result of apprehension in business and commercial circles about Castro’s policies, e.g., the arbitrary lowering of rents and the sequestration of International Telephone and Telegraph properties. Tourism and exports are down. Merchandising is off. Construction has virtually ceased. High unemployment, a chronic problem in Cuba, will become more serious as the sugar harvest is completed. While there has been some progress toward stabilizing the labor-management relationship, labor is restive.

20. Agrarian Reform. Castro has placed the greatest emphasis on agrarian reform. Such reform is in the liberal Latin American tradition and if ably carried out, probably would benefit Cuba in the long run.⁵ To put this into effect, he promulgated in early June a law aimed at dividing land holdings and at eventually ending foreign ownership of Cuban land. The law is the recognized product of Castro’s radical and extremist supporters; it was adopted in place of a more moderate law drafted by the former Minister of Agriculture.

21. Cuban moderates are concerned that Communists will exploit the program to their own advantage and that implementation by inexperienced officials will adversely affect the economy. Their concern is justified. Castro has appointed pro-Communist Antonio Nunez Jimenez as director of the Agrarian Reform Institute which is charged with supervising the implementation of the program. The moderates probably are also worried that the effect of this law together with the regime’s other actions penalizing private investment, will be to discourage new investment by Cubans as well as foreigners.⁶

22. While Castro was displeased with the US reaction to his program, nevertheless he evinced concern that his radical reform actions could result in loss of Cuba’s preferential treatment in the US sugar market. He is also mindful of the importance of the US to Cuba as its major trading partner and source of investment capital. At the same time, he probably calculates that the US freedom to adopt sanctions against Cuba is restricted by US concern to avoid actions which might seriously impair its influence elsewhere in Latin America. Should he believe that the US Government or private interests were exerting pressures to bring about a modification of his policies, he would probably react strongly. It is possible that Castro would counter US pressures by threatening to demand the US withdrawal from its naval base at Guantanamo or by threatening the expropriation of other large US holdings.

B. The Outlook

23. Despite Castro’s continuing appeal as a national hero, opposition to him is growing. The confiscatory nature of his agrarian reform law has aroused substantial opposition from the middle and upper classes. These segments of the population, impatient with Castro’s inexperience and impulsiveness, are generally dissatisfied with his mismanagement of the economy and the radical tone of his program. Together with the hierarchy of the Catholic Church and even some members of Castro’s movement, they are increasingly dissatisfied with his failure to curb Communist influence. There are discontented elements in the active and retired military because of loss of personal position. There is some dissatisfaction in other groups which took part in the revolution, because Castro has failed to give them a larger role in the government. Exiles in the US, Mexico, and the Dominican Republic are actively plotting; there are a few armed resistance groups forming in Cuba itself. However, while armed attacks against the regime are possible, we do not believe that any of these groups is sufficiently well organized at this time to pose a serious threat to Castro. Nor do we see a leader on the horizon capable of unifying the opposition. Therefore we believe that Castro will remain in power at least during the period of this estimate .

24. The Communists probably do not now control Castro, but they are in a position to exert influence in his regime and to carry on further organizational work. As we have noted above they have succeeded in gaining positions in some of the country’s most important institutions and organizations. Additionally, the Cuban Communist Party, probably Cuba’s best organized political party, is expanding its influence in the country’s radio and TV systems and, to a lesser extent in the newspapers and in the educational system. Its position is enhanced by Castro’s sense of need for Communist cooperation at the moment. We believe that at least for the period of this estimate the Communists will continue to support Castro’s program and will attempt to avoid giving Castro any cause for believing that they are seeking to move in on his position as leader.

25. Castro and certain of his followers have recently made anti-Communist statements which suggest that they have some concern about the local Communists as a potential threat to the 26th of July Movement’s dominance. Thus far, however, Castro has taken virtually no action to curb the Communists, and we believe that he is unlikely to take drastic steps against them during the period of this estimate.

III. Caribbean Revolutionary Movements

26. Over the past decade, the most prominent leaders of the antidictatorship crusade in the Caribbean area have been Jose Figueres, former president of Costa Rica,⁷ and his close friend, Romulo Betancourt, recently elected president of Venezuela.⁸ Figueres has been motivated primarily by a fervent desire to secure the ouster of the Somoza family in Nicaragua; Betancourt’s main target has been Trujillo in the Dominican Republic. Betancourt and Figueres have been able to give some support and encouragement to non-Communist exile groups, especially from these two countries.

27. There have also been some exile groups which are influenced by Communists or Communist sympathizers. Members of the Nicaraguan Patriotic Union and the Dominican Patriotic Union, both of which are Communist-connected, came into the open in Venezuela after the ouster of Dictator Perez Jimenez in 1958. These groups have thus far failed in their efforts to join forces with the democratic exile groups. We feel that developments are more and more pointing to the possibility that Communist elements throughout the area are working to achieve an outbreak of hostilities among Caribbean nations.

28. After taking power in Cuba, Castro assumed leadership of the crusade against dictatorship. However, Betancourt and Figueres soon became alarmed at Castro’s demagoguery, his support of Communist-connected exile revolutionists, and his offensive treatment of Figueres, and are presently at odds with him. Despite Castro’s open break with these established liberal leaders in March, Cuba continues to be a main gathering place of exiles and mercenaries who are planning revolution against the Dominican Republic, Haiti, and Nicaragua. Castro left the task of dealing with these groups to his brother Raul and ‘Che” Guevara, who have displayed a clear preference for Communist-connected Nicaraguan and Dominican groups. Other more moderate revolutionists continued to look to Figueres and Betancourt for aid and guidance.

29. The prompt reaction of the Organization of American States (OAS) to the April invasion of Panama by Cubans caused Castro to reiterate a policy of nonintervention in the affairs of other states.⁹ Nevertheless, Castro is continuing to support various exile groups and we believe that in spite of the risks involved he will continue to assist these groups to invade their respective homelands.

30. No government in the area, with the exception of Cuba and possibly Venezuela, is likely to give substantial material aid to revolutionary invasion forces. However, most of them play hosts to numbers of exiles. Moreover, while most governments were willing to approve OAS action which supported the Panamanian Government against invasion, they were reluctant to act when exiles recently invaded Nicaragua, and they will be even more reluctant to agree to OAS action on behalf of the Trujillo regime.

31. Venezuela under Betancourt has been officially committed to pursue its antidictatorship campaign through the OAS. Betancourt has at the same time probably given some support to revolutionaries. On the other hand, President Echandi in Costa Rica has sought to prevent military forays by exile groups against his neighbors, even though the effectiveness of his efforts has been reduced by the strong influence of the Figueres-led opposition, the country’s small military capability, and by general Costa Rican antipathy toward the Somozas. Mexico, whose government has steered clear of involvement in Caribbean intrigue even though the country has been a traditional haven for exiles, has begun to limit the activities of Nicaraguan rebels within its borders. El Salvador and Guatemala, which were willing to give military support to Panama when it faced invasion, probably would be less willing to support the Somozas or Trujillo. A recent border agreement between Honduras and Nicaragua to prevent use of either’s territory against the other will probably be observed by Honduras despite longstanding tensions between the two countries. Nevertheless, invasion from Honduras remains a possibility.

Haiti

32. The political situation in Haiti, long unstable, is rendered especially precarious by the serious illness and uncertain life expectancy of President Duvalier. The Duvalier regime is strongly opposed by the country’s mulatto elite, by labor in the capital city, and by the army. While Duvalier retains support among the black lower classes, he is sustained primarily by the terror inspired by his secret police and armed civilian militia.

33. Duvalier’s position has been bolstered by US aid, which averted economic collapse, and by the provision of a marine training detachment. Moreover, he apparently can count on the Dominican armed forces for some protection as a result of Trujillo’s declared intentions to patrol the sea lanes and to attack exile groups landing anywhere in the islands.

34. There is, however, no clear alternative to the Duvalier regime. The two principal opposition leaders, Louis Dejoie and Daniel Fignole, are in exile. Although they might combine to overthrow Duvalier, they represent irreconcilable elements—Dejoie, the elite; Fignole, organized labor and the city mob. They probably would come into conflict with each other once Duvalier were removed. The Haitian Government continues to be concerned that there will be a Dejoie-Fignole invasion from Cuba. It is also concerned that invasions of the Dominican Republic will adversely affect its own situation.

35. There are very few Communists in Haiti and no organized Communist party, but the nucleus of a Communist movement exists among the intelligentsia. A significant number of known and suspected Communists are employed by the government which provides the principal source of employment for intellectuals.

36. Barring Duvalier’s death or incapacitation, we believe that he has a better than even chance of staying in power for the period of this estimate. Even in the event that he regains his health and vigor, it is highly unlikely that he will be able to maintain himself in office to the end of his term (1963). When he goes, it is probable that there will be a period of political chaos comparable to that following the exit of dictator Magloire in late 1956.

Dominican Republic

37. The 30-year-old Trujillo dictatorship is being severely challenged for the first time. Small-scale forces associated with the most important Dominican exile organization, the Dominican Patriotic Union (UPD), have invaded the Dominican Republic from Cuba. The UPD, based mainly in Venezuela and Cuba, has some Communists in leadership positions. It is operating with no interference from the Venezuelan and Cuban Governments, and is receiving support from the Cuban Government, the Venezuelan Communist Party, and probably the Venezuelan Government. While Trujillo has threatened to retaliate with air attacks on Cuba if an invasion supported by the Cuban Government invaded his country, he has so far failed to move. However, the possibility exists that Trujillo will make good his threat and thus create a war situation in the Caribbean area.

38. There has been little sign of local civilian or military support for the invaders, although there is probably considerable latent opposition to Trujillo. Moreover, we continue to believe that Trujillo military will probably be able to crush small-scale invading efforts. Trujillo’s military capabilities have recently been increased by large-scale arms purchases abroad.

39. Hence, given the capability and apparent loyalty of the Dominican military, we believe that the Trujillo regime is likely to survive through 1959. However, the possibility remains that failure to eliminate invasion groups will stimulate internal opposition and that the combination of these two forces might cause the military to defect and the regime to topple before the end of 1959.

Nicaragua¹⁰

40. The Somoza regime has controlled Nicaragua for 25 years through its firm hold on the country’s only armed force (the National Guard) and the administration’s National Liberal Party. Now the regime is threatened by a variety of revolutionary movements among Nicaraguan exiles and by internal opposition elements, largely among the business class. We believe that the danger to the regime is primarily psychological; it is less a function of the actual capabilities of any particular opposition group than of a spreading conviction that the Somozas’ time is running out.

41. President Luis Somoza succeeded his late father in the presidency in a constitutional manner.¹¹ His position was confirmed in an election in 1957 for a six-year term; his younger brother, Anastasio (Tachito) Somoza, remains in command of the National Guard. Luis has recognized the rising sentiment against dictatorship in Latin America and has endeavored to free himself of that stigma by exercising less stringent police controls than did his father.

42. However, the domestic situation has not favored Somoza’s efforts to change the political atmosphere in Nicaragua. Economic conditions are unfavorable, and low world prices for cotton and coffee, on which the country depends for most of its foreign exchange, threaten continuing hardship. In addition, the business community, long resentful of the Somozas’ control of much of Nicaragua’s economy and disturbed by Luis Somoza’s inclination toward liberal economic policies, is becoming increasingly hostile to the President.

43. In any event, Somoza’s room for maneuver is limited by personal pride and a desire to maintain his family’s position as best he can in changing circumstances. Furthermore, it is impossible for Luis Somoza to divest himself of the family reputation.

44. An attempt has been made to unify the many Nicaraguan opposition groups in a National Opposition Union (UNO). This loose coalition includes the major faction of the traditional Conservative Party, the Independent Liberal Party (which is the anti-Somoza element of the traditional Liberal Party), and smaller anti-Somoza groups both in and out of Nicaragua. Enrique Lacayo Farfan of the Independent Liberal Party is the recognized leader of this opposition grouping which has the active support of Figueres and the implicit support of Betancourt. While the Conservatives have been reluctant to collaborate with Communist-associated revolutionary groups, Lacayo, believing that effective action is possible only with a united opposition force, has sought their cooperation, at least in El Salvador and Cuba.

45. The Communist-associated revolutionists include a leftist minority of the UNO, the Nicaraguan Patriotic Union based in Caracas and in part financed by the Communist Party there, and numerous exiles in Cuba, the principal leaders of which are at least pro-Communist. These groups are considerably smaller than those led by Lacayo, although prospects for the group in Cuba have been enhanced by the support of the Cuban Government. Castro apparently commissioned ‘Che” Guevara to facilitate the preparation of exiles in Cuba for revolutionary action against the Somozas; Guevara’s partiality for Communists has strengthened Communist leadership of the principal Nicaraguan exile group in Cuba. Castro’s government is continuing to provide support for this group.

46. The Communists by themselves present little threat; their movement in Nicaragua, unlike that in Cuba and Venezuela, is small and has never been well established. However, if the non-Communist exiles are not able to mount an effective invasion on their own, they may turn to Cuba for material assistance and seek to coordinate their efforts with the Communist-led groups. The end result would be an increase of anti-US and pro-Communist influence in the revolutionary movement and in any successor regime which it might set up.

47. The Somoza regime is currently threatened with attack from exiles who have intermittently invaded Nicaragua in small groups. It is also under pressure from internal political opposition groups to give up and to hold free elections in the near future. In late May, in conjunction with an attempted general strike fomented by the Nicaraguan business community, an invasion was made from Costa Rica by a small group of followers of Lacayo. This effort failed in part because the invaders lacked training and the will to fight. It also failed because of the effectiveness with which the National Guard operated, the failure of the exile group to receive supplies and reinforcements, and the lack of favorable popular response.

48. There will almost certainly be further attempts against the regime in the coming months. In these circumstances, the Somozas probably will be increasingly dependent on the 5,000-man National Guard as an instrument to maintain power. The Guard has thus far been an effective force for maintaining internal security, but in the past there have been some signs of dissent within it. While it probably is in the main loyal to the Somozas and could put down an armed uprising in the capital city, it would have great difficulty in dealing with a general strike involving both management and labor. Moreover, should this situation be accompanied by a sustained and growing guerrilla action, the Guard probably could not assure the Somozas’ survival. Nor would the OAS likely to intervene on behalf of the Somozas in a situation where internal opposition played a major role.

49. We believe that even though the Somozas have survived recent invasions, their chances for retaining power are diminishing. They probably would be able to prolong their tenure if they were willing to make significant concessions to the opposition—a course which they have been disinclined to follow. However, we believe the Somozas will remain in power at least during the period of this estimate.

Panama

50. The position of the oligarchy which rules Panama is weakened by factionalism and the poor economic situation. In the past year, the stability of government has been threatened by serious student strikes and riots and by internal and external revolutionary conspiracies. The recent prompt OAS action against the Cuban mercenaries has reduced the threat of further invasions in the near future. However, the internal situation will become more unstable as political maneuvering increases prior to the 1960 presidential elections. A bitter and violent struggle between factions of the oligarchy, which has often occurred in the past, could encourage extremists to step up efforts to overthrow the dominant families. However, the present regime will probably remain in office for the period of this estimate.

Other Countries

51. We believe that the government of President Ydígoras in Guatemala will probably remain in power during the period of this estimate. In Honduras the government is unstable primarily because of a struggle between President Villeda’s Liberal Party and the military, as well as increasing opposition by the influential business community. Nevertheless, the military, which has suppressed several revolts, supports Villeda, and it is likely that he will survive through 1959. The Government of El Salvador, despite some intrigue directed against it, seems politically and economically stable. In Costa Rica President Echandi’s government seems secure despite the problems created by the President’s efforts to halt Nicaraguan exile expeditions. We believe that the Salvadoran and Costa Rican Governments will remain in power through 1959.

[Here follows an Annex with three tables entitled “Estimated Armed Forces Personnel Strengths,” “Estimated Military Aircraft,” and “Combatant Naval Vessels.”]

1. Source: Department of State, INR Files. Secret. According to a note on the cover sheet, the CIA and the intelligence organizations of the Departments of State, the Army, the Navy, the Air Force, and The Joint Staff participated in the preparation of this estimate. The members of the United States Intelligence Board concurred in the estimate on June 30, with the exception of the representative of the Atomic Energy Commission, the Assistant to the Secretary of Defense, Special Operations, the Director of the National Security Agency, and the Assistant Director of the FBI, who abstained on the grounds that the subject was outside their jurisdiction.

2. The Assistant Chief of Staff for Intelligence, Department of the Army, the Director for Intelligence, The Joint Staff, and the Assistant to the Secretary of Defense, Special Operations, do not agree with the over-all assessment of the weakened position of the Somoza regime as portrayed in the Nicaraguan section of the estimate. Rather, they believe that evidence points toward a greater flexibility and position of strength of the Somoza regime.

   Consequently, their net evaluation would read as follows:

   “The Somoza regime is currently threatened with attack from exiles, supported and encouraged both by non-Communists and Communist elements in other countries. Despite this threat to its stability, however, as a result of its manner of settling the business strike and dealing with the recent invasions, the Somozas’ chances for retaining power at least for the period of this estimate remain good.” [Footnote in the source text.]

3. Footnote is the same as footnote 2 above.
4. Sugar normally accounts for about a quarter of the annual GNP and brings in $600–700 million foreign exchange. [Footnote in the source text.]
5. Less than eight percent of landowners own 75 percent of Cuba’s total agricultural area. [Footnote in the source text.]
6. US direct investment in Cuba amounts to about $900 million, representing almost the entire amount of all foreign investment in the country. It is roughly divided between investment in agriculture, chiefly sugar, and that in public utilities—telephone, power, and railroad companies. American sugar companies operating 31 of the total 161 sugar mills, hold about two million acres of land, less than half the total cane acreage, and lease or contract for the purchase of cane from another 800,000 acres. The dozen US sugar companies produced about a third of the 1958 sugar crop. [Footnote in the source text.]
7. Figueres was President, 1953–1958.
8. Betancourt was elected President of Venezuela, December 7, 1958, and inaugurated February 13, 1959.
9. Documentation on this subject is in Department of State, Central File 363. For information, see Inter-American Efforts To Relieve International Tensions in the Western Hemisphere, 1959–1960 (Department of State Publication 7409, Washington, 1962), pp. 6–10.

10. The Assistant Chief of Staff for Intelligence, Department of the Army, the Director for Intelligence, The Joint Staff, and the Assistant to the Secretary of Defense, Special Operations, do not agree with the over-all assessment of the weakened position of the Somoza regime as portrayed in the Nicaraguan section of the estimate. Rather, they believe that evidence points toward a greater flexibility and position of strength of the Somoza regime.

    Consequently, their net evaluation would read as follows:

    “The Somoza regime is currently threatened with attack from exiles, supported and encouraged both by non-Communists and Communist elements in other countries. Despite this threat to its stability, however, as a result of its manner of settling the business strike and dealing with the recent invasions, the Somozas’ chances for retaining power at least for the period of this estimate remain good.” [Footnote in the source text.]

11. Luis Somoza Debayle was elected President of Nicaragua on February 3, 1957, for a 6-year term beginning May 1, 1957.