Foreign Relations of the United States, 1958–1960, Eastern Europe; Finland; Greece; Turkey, Volume X, Part 2

305. Operations Coordinating Board Report⁰

Washington, January 29, 1958.

REPORT ON TURKEY (NSC 5708/2, Approved June 29, 1957)¹

(Period Covered: From November 8, 1956 through January 29, 1958)

A. Summary of Operating Progress in Relation to Major NSC Objectives

1. Summary Evaluation. In military and political matters there was continuing progress towards meeting our major objectives during the period under review. However, in economic matters there was little progress towards the achievement of the stable Turkish economy which NSC 5708/2 set as a goal. (See Annex B) U.S. policy toward Turkey as set forth in NSC 5708/2 has been reviewed from the standpoint of operating considerations and in light of operating experience to date and of anticipated future developments. No review of policy is recommended.

2. Turkey’s alignment with the West continued to be close and effective, becoming increasingly so as the Syrian Government drifted into a firm pro-Soviet position. As Russian propaganda pressures on Turkey increased, Turkish dependence on Western support was made even more apparent. Despite the delivery of two Soviet notes containing veiled threats concerning the Turkish attitude toward Syria, there has been no appearance of weakened will to resist communist invasion or subversion.

3. The security arrangements of NATO and the Baghdad Pact have received wholehearted Turkish support, and Turkey has continued to press for strengthened military capabilities of the Baghdad Pact and wishes to see additional Arab state membership in that body. The Turkish military effectiveness as regards a Soviet-supported Arab attack on its southern border has been increased while capability to resist a Satellite attack on the Straits remains high. Some delaying capability exists in the event of a direct Soviet attack or a Soviet-supported attack by its satellites.

4. U.S. access to Turkish military facilities remained good. Handling of incidents involving members of the large American community indicates the Turkish Government’s determination to avoid permitting such incidents to harm U.S.-Turk relations.

5. As concerns Cyprus, despite approaches by the U.S. Government stressing the need for flexibility and further compromise on the part of all parties, the Turkish Government continues to maintain a very firm position in favor of partition as the only feasible solution. Turkish-Greek relations continue to be strained, and any resort to full-scale violence by EOKA (the Greek Cypriot revolutionary organization) is likely to be met by counter-action by Turkish Cypriots.

B. Major Operating Problems or Difficulties Facing the United States

6. Stabilization of the Turkish Economy. The Turkish effort to finance a large economic development program and a substantial military program has seriously strained the country’s internal and external financial position. The resultant increased demand for resources has caused a steady price inflation accompanied by rather severe shortages of both imported and domestic goods. Defaults and arrearages in foreign payments have damaged the country’s international credit. Essentially Turkey’s major economic problem involves adjusting its programs to its available real resources. Greater economic stability, accompanied by increased production, could be achieved by cutting back the military or the economic development programs, particularly if such cutbacks were accompanied by effective fiscal and monetary measures. At the present time Turkey has much new productive capacity that is either unutilized or underutilized as a consequence of the lack of raw materials and spare parts. U.S. efforts to encourage Turkey to adopt more effective financial measures, including a more realistic exchange rate, in order to live within the limits of Turkey’s available resources hitherto have not been successful and have been a source of friction.

For more than a year prior to the October 1957 national elections, the Menderes Government gave first priority to electoral considerations, and virtually abandoned all efforts at internal economic stabilization. In fact, the Government’s economic policies and programs, associated with election campaign efforts, accelerated the country’s inflation. Recently the Government of Turkey has resumed efforts to control prices particularly of certain food items. However, these steps have not been accompanied by more basic corrective measures although the Government’s attention has been focused on the serious economic situation. On December 4, Prime Minister Menderes presented the program of his Fifth Government to the Grand National Assembly. Although the program does not explicitly point to bold new measures it speaks of the Government’s objective to keep prices in line, control bank credit, and review the State Enterprise programs with a view to placing them on a self-sustaining basis. These measures coupled with the proposed FY 1958 budget which is more conservative than last year’s budget are good signs. However, it must be recognized that the success of the measures depends on the Government’s determination to follow through with actions which are often politically unpalatable.

7. Cyprus. In our continuing efforts to promote a settlement to the Cyprus problem we have found that the Turkish Government has taken an extremely firm stand in support of partition as the only feasible solution. Only recently this has been reiterated by the Turkish Prime Minister in high level private conversations and in public pronouncements. This stand has the support of all opposition parties in Turkey, and it is clear that the Turkish Government considers this problem a “national” issue.

The Turkish Government counts heavily on friendly and allied nations to support its position on Cyprus and reacts strongly to any support given the Greek position. This was demonstrated when Greece introduced a resolution in the recent session of the UN General Assembly² which, as amended, called for the renewal of negotiations with a view to having self-determination applied to the Cyprus case. This was strongly opposed by the Turks and the British. The resolution was approved by a majority in the Political Committee but failed of a two-thirds vote in the General Assembly. (The United States abstained on both votes.) Despite the public position that the vote represented a defeat for Greece, the sensitivity of the Turkish Government on the subject of Cyprus was well illustrated by its reaction to the positive votes cast by Iraq and Lebanon in the Political Committee, i.e., a strong protest was made to Iraq, Turkey’s partner in the Baghdad Pact, which resulted in an Iraqi abstention in the vote in the Assembly; and in the case of Lebanon, a bill in the Turkish legislature authorizing the transfer to Lebanon of a small quantity of arms and ammunition was withdrawn.

8. The Turkish Military Establishment. The Turkish defense authorities have yet to appreciate the need for a reduction in the number and size of conventional-type units in phase with the introduction into the Turkish forces of costly modern weapons. In addition to present NATO force goals, the Turks have pressed for four additional destroyers (in addition to four obtained from U.S. MDAP and four to be obtained from the British) to permit a forward strategy in the Black Sea and a mechanized corps for the southern border facing Syria. The U.S. Government has taken the position that it can only support those forces which are designed to carry out the approved strategic concepts of the United States. Pending a redetermination of NATO objectives for the Turkish Ground Forces, the FY 1959 military assistance program is primarily directed toward fulfilling the matériel deficiencies in the M-Day (first priority) forces.

It is anticipated that General Norstad will shortly be making recommendations relating to the stationing of IRBM’s in the NATO countries. Should Turkey be chosen as a possible location for such units, the Turkish authorities will probably be eager to accept the missiles and will probably agree to providing the sites, but will consider this move as strengthening their hands with the U.S. in bargaining for aid.

Note: National Intelligence Estimate for Turkey is: NIE 33–56, Turkey As An Ally, February 21, 1956.³

0. Source: Department of State, OCB Files: Lot 62 D 430, Turkey 1956–57. Secret. A title page, covering memorandum, and three annexes (a report on recent developments in Turkey, a financial analysis, and an MSP pipeline analysis) are not printed. In the undated covering memorandum, Elmer Staats, Executive Officer of the OCB, wrote that the Board revised and concurred in the report at its January 29 meeting, noting a Department of State suggestion that the ICA and IMF attempt to reach a common position on Turkish economic reforms. The minutes of the January 29 meeting are Ibid., Minutes. The report on Turkey was transmitted to the NSC, which noted it at its February 14 meeting. (NSC Action No. 1864, February 19; Ibid., S/S–NSC (Miscellaneous) Files: Lot 66 D 95, Records of Action by the National Security Council)
1. For text of NSC 5708/2, see Foreign Relations, 1955–1957, vol XXIV, pp. 720–727.
2. U.N. doc. A/3616 (XII).
3. Not printed. (Department of State, INR–NIE Files)