current support memorandum
spanish-soviet trade may be resumed
OFFICE OF RESEARCH AND REPORTS
this report represents the immediate view* of the originating intelligence components of the office -of reiearch and reports. comments are solicited.
SPANISH-SOVIET TRADE MAY BE RESUMED
Spanish-Soviet economic relationscurtailedfranco'swar victory, may-soon bo resumed.. Persistent rumorsof an imminent Spanish-Soviet trade agreement, havespeculationresumption of full-scale commercialbetween the two countries may not be far away. 1/ Department despatch ofuoting asource, reported that "Spain has definitelycommercial deal with the Soviet Union for theRussians reportedly will pay in machinery." /
Although General Franco has,ovemberdenied that Madrid had any "direct relations"USSR, he did admit that Spain had from time -to timegoods in trade from third countries and that somemight be reaching the Soviet Union through' i' ?
Indicative of the tenuousnessthese'perhaps of the wishful thinking of individual- Spanish business interests-are the many conflicting reports of the commodity composition of any projected trade agreement with the USSff. Reports havethat the USSR is .prepared" to offer wheat at pricesbelow those prevailing ln the wotfld market In return for Spanish pyrites and mercury. 4/ The USSR is also, reported to be willing to offer pig iron and machinery in return forcitrus products and rice. 5/
There appears substantial unanimity, however, in theany resumption of normal commercial relations betweencountries would inevitably be tied to politicalon both sides. Madrid undoubtedly wjil press herreturn of allortion of the Spanish goldln the USSR6 and for some settlement ofPOW issue. It remains to be seen- whetheresumption of commercial relations and theto enhance their subversive activities In Spain. influence will be deemed aquo' by
SUPPORT MEMORANDUM2Original document.