CUBA

Created: 8/19/1965

OCR scan of the original document, errors are possible

CUB4

PROBLEM

To estimate the Cuban situation or two.

outlook over the next year

tl ere is virtually no chance of

CONCLUSIONS

A. Castro's hold on power is Srrn| his overthrow in the foreseeable future.

regime has abandonedand isThe economy lsto advance living conditions

alternative

Chinese

Arteries

clandestine

that be hasfrom the Soviet Union, Castroand has cooled toward thej

eeononi* leveled off in the tains, owing chiefly lo imxeased Continue to suffer from ihor'jrvi (pit has improved. on rcoooonc assurance from Union. In total ivaillbifity of ranunlstrcooomy before the Castro revolution, but

DISCUSSIONRESENT SmjATICN

A.y

Cdban

dependent

eriod of nwked decline, th. Utter pert ofnd hai ssncucene smger production, Industry andvkti of pans and replacements, though overall on Cub*lient economy, heavily the Communist camp, particularly the Savied goods andaid from the has moved somewhat above the levelas been offset by increase in population.

SELECTED ECONOMIC

Th* Ifum .hicb folle-

rt ilTHau? oOntln

Um^nrnM k Aid to

Cabin

v oi Coodi ami Srrv-

nen)

Craei

of mnnual or

{'*m)

of central direction andervices hat changed iharply. percent) has alnsost doubled since Jto the large military ertabluhrnenf. rd social services. Thu has brought of certain groups cholarship ay, and those formerly veryarger share of goods and jervives. Private consumption per capita Is Numbers of people,orse off. Poor quality and gi odt persist, and the list of rationed

-n the Den -ii Inrhiuc McrioMel

military

s the economy has taken ondministration, the dutnbutiun of go The goneat's mare (now more than SO the revolution. Much of this increase goes the ertensive education program, and evoanc about an improvement ln ths economic lot students, party mem ben, torn* of the filli

7 . l

^mtidUhiy

Investment expenditures alto nowlthough the Increase has oot been great, now probablyercent lower thenmong the urban middle class, are.nortage. of many foodstuffs and consul kt

Approved lot

Sugar accounts For aboutercent uf (he value, srotsercent jf grow nattoml product

any givenwtlh theajor detenruhant of the overall itate of theuba's vulnera wlity to low wgar price* on Che world market hu bem reduced, though, by no means eliminated, by the coewrdensetrt of the USSR and certain other Coram mot couotries toarge and uicreasing amount] of sugar at fix eenta; per pound.'

iits year's sugar crop of six miRion ton*otable achievvrmmt. To meet this difficult goal, howev. r. the regime was forced to divert Und and laborby coercion-otherIronically, world sugar prices are so low that thearning power of (hu harvest it no more than that of the4 crop, and hard-currency leanings from Free World markets are cooridcrably tower. Thus, although Cuba's overall economicis improving, the total supply of good* ant tervicei probably wul nut Increasend the econorny's gains will do Ittle to diminish consumer dLasaUsfaction.

nternal PoKrlcal Mattersartroi hold on power remaira firm. His revolutionary parry (PUBS) is

po too*

Rafaeleading

only beginning to take on significance at the national level; at the local and provincial levels, however. It plays an increasingly! active and important role. Within Castro's entourage. Raul Castro >nc President Osvaldo Dorticos have gained nature; tha former controls the military ink ta second to Fidel fas the PUBS, the latter has aamimed central of the *dlnlsjfry of Economy and of the Central Planning Beard. Earlyidel Gupro took personal control of the Agricultural Ministryeplacing Carlos

(fWUnalnf) 10

eer. Since IflOi. Cahaa aeBlne formwsr, batand eihn CanunuMM muninn HflM phae eaBhe USSR to tdepd te;1 WTO-very anal ptepernan othut the icnuu amnunt meimlCawawijbmaaawj

BlCflr)

'Suea* Oaanal [ta nuTttoa cxnc

i IM iBaa IT BS 4B SB

Cuba* Internal racer conwnpnon I*aat Five World mWiii have

IBTp.

tkaer at LO aeSJea awe at IMS. Toe SerM Bafewj have tear* um remainder of Dm own. Thein racer pradecuon tehta yeanulltea la al at aW Baad arte* ef mm aaaa pat peeaeL AH bat

C

I For wuh SevMt eoeua under bnaMril omnnrnrn hb* (ht eraae oa Uie Sevwt fan at nntudi eaaOrr aovMiej M

DaleBH

ideologue, hat been out af ntht March and is no longeras Minuter of Industries.

a Political infighting between the Old Comoi'Mitits and Fidelities haswith the Ok! Contanunuciinx the worst of it The demotion of Rcdrigoexow to oid-iuwi mduencc. Joaquin Ordoqui, another important Old Communist wu ousted tram his party and govemrnentai posts last November. lie has been accused of treosoti snd is being detained but has not been Ivought to trial The Old CommumiUto play an Important role at tbo local and provincial levels.

C Th* Mltlhar

T. Opposition to the Castro regime rernaim fragmented and feeble. Covrro-ment "nwanndi and anus rnobiU^non rcrorxems have had

Soviet-nipp tied; for the past year cceisisted moitly of replacement tlonai training has probably Ine military. esult of the gen nowrowing and trained readv Wit actual combat experience. They material luppurt and advanced0 Soviet military personnel remain" deciined somewhat; scene of them are maintenance persontwi.

uJi

the awwll*ned countries. *nd ufsupportrr of re roluticauuyCom rapitalist imperuuism"

LL Cabas need far sobataoaai ixunomlc aasiatanci provides Ibe USSR with Its main leverage on Castro. We beSeve (hat tbe new Soviet leaders aremore inclined than Khrushchev to use or threaten to use that leverage-but oat to the point of actually wtUwaiduig aid.ubstaaoai number of Rtuasan technicians continue to work as adviser* to Cuban Industry, tba Soviets probably feel that much of their larg*n Cuba has been snnandcred be the administrative bumbling of tba Castro rcftma. They have undoubtedly pressured Castro to straighten out Cuoa'i con/used economic practices. NegotJ-aduna for3 Cuban-Soviet eromrnic agreement dragged on from October to Febrnarr. Ultimately tba Sovfcroj .greedai of aid approasasetefr as

with the: tbe Communist ranks, ii-nt abo attended In addition, Castro emics have indicted on the

uring tba past year, the Castro regime baa Loved cJceer to tbe Soviets us tha Suio-Soviel dispute. At the conference of (atin American Communist parties tn Havana asuba agreed to oriented parties and condemned factionalism wl Cuba, in what China considered yet another meeting of Communist parries In Moscowas cr.Baxed Peiping for the damage which its Communist movement. The shift toward Moscowl redects in part Sovietbut rt aiso resectswn present assessment of the ntuanon. He has probably became convinced that China Is mai uy ivaoorunbla for the split, and has rebuked it for divisive propaganda icrtvr les la Cuba itself. He also probably views Peipingompetitor invenca for Use allegiance of revolutionary forcea.

Efforts fo "oment ffevoiuhort

IX Cuba haa crmCnucd to provide propaganda backing, training in rur/version and guerrilla warfare, and limited Snanoal aid tc Communist and other Latin American revoluOonarica. But Castro now seems to believe that local elements should bear tha principal burden offfort, with Cubanpyurtlng role. He baa apparently abandoned his belief that ail Latin America Is poised on the brink of revolution. Consequently, he Is concentrating on those countries where reactionaries are. Venezuela, Cuaiemala, Colombia, and Peru. Elsewhere be appears ready to wait for targets ofA'ong with thismphasis. Castro has at least !empceaTUy muted his opposition to the old Una Communu parties In Latin America; in return they are pledged to gtva "activeevolutionary dementspacinc list of countries.1 They have done little lo date to honor this pledge.

Daw

n

k

>"1

nKivumenli inAfrica- Thus Africa Is small and itetback Sen Bella in All

'er. ihe Cohan effort the overthrow of Castro s

umber of African to Alteria and Tanzania.

Cuba

has also provided gueml haa sent some milit

il

KJ

wifn fhe) rsofl-Communisr Worfc

hrough his njpport of various revoieuunory dements and his consistent and-unperiallst posture. Castro has had lomje success in increasing Cuba's influ-esce arnoDg the non-aJlt>Msd nr.twru. Cuba has also sought closer economic ties with venous aoo-ConsmunbtVimanly to expend exporu snd to circumvent the US economic denial protrant In this Cuba's success has varied almost entirely according to its ability tQ sell sugar at good prices. When Cuba had money, as insome Eeropfcen traders were willing to extend nnaD amounts of trade credit; when Cuba's convertible esxhsnge holdings areat present most traders Inoods Carrro needs avoid all but cash dealings.

astro has maintained his general fmsfmguiida attacks on the US. but. since the overthrow of Khrushchev, has not esrrted pressureumber of bvueo involving direct US interests. The Cubans have, for example, set aside their public and dlpiomeDc campaisn toj compel the US tover*

the

a

they hi of Cuban-US reUiti

so far as to renew overture

' x

ounce*

IS.3hole, the Cuban economy wiD continue to Encreaie at about the roteJ. however, prospects are rioudedhe efforts to expand tug* output are cutting kito theof some other crona. Thus the rcoapi-cts fur un liKTraar In total jgriciillure

07 arc limited, mm though Inert' may Le further irm^ruvement In sugar0 outlookn pautlcuiarj is dimmedurrent reduction in the supply of fertillaers. In the lnduarna. rector of the economy, ft seems doubtful due tho now of raw materials and equipment wdl jis^unaaotjy over tbe neat two years. Measurableill proLably ba made In some sectors, but total industrial production wet probably rise very slowly.

ba Cuban econorny could aauaa ngniScant progress if mnananagcmrm and poor boor morale could be reduced.low,art because so many of tbe moat taleaofd. and best frained Cubans have left and are leaving the country. In addition. Castro has clearlyrevolutionary zeal over cra^petance. Labor monie. on the other hand, may improveesult of Castro's recent recognition of tha need for material incentives. If the current economic Improvement continuest will probably not suffice to make an appreciable dlStrence in living standard* within the nest two years. Id any case, tha Cuban eopnorny will remain highly dependent upon trade with and aid fron. the Communist countries. Any large espanxkoa of Cuban trade with tbe West ia

In preserving tbe Castro iue his efforts to increase major successes areill prcceed_cautiousIy America.

espite sporadic frictions, tha Castro rcguneii political and economic relationship with the Soviet Union Ii almost certain to remain close, at least during tbe period of this estimate. Castro has no practical alternative to Soviet assistance, and the Soviets have an Important st regime in pn*er. Castro will almostuba's influence among the non-aligned natica libefy. We believe that both the Soviets In theirto undercut the

believes that

dramatic Irnprovernent in US-would probably not offer

astro almost M.

lley limited capabilities he will aid to active revolutionarieser extent In Africa. He Is hough he will continue his rover, ve think thatcal tactw, such as closer

Cuban rejectee* La highly tmllkrty. Therefore, bef any dgnincant crmcessloos to achieve IL

revolution" wil

Mortov

ommitr- mt to the "erportolicy of has regime. We believe tbat within hb conrinoe to provide training and some clandestine in aeveral Latin American countries ande ULefy to display caution in moat af these efforts, estcsistve propaganda backuir of insurgents. Ma alsoreasing emphasis ns longer range po

cooperation wttll Mcotw-onwilwi Commu-mt parties! and iu some bUMlKill with store moderate leftists as well. Nevertheless,believe tlutt Cistro still regards parallel revoluQons elsewhere in Latin Ameiis best hope ot" breaking out of his presentbe hemisphe e.

dminurtratloo of Cube* mternul sfsurS will remain highly per* sonel sithough sons* political and economicrlon lihe oasnrubons which h* haseconomic socssi. and sevunty organizations based on Sovietcontinue to develop gradually, eventually becoming more effective and perhapsajor role in deciiiim making But we beiieve that over the oext year or pro tbey will continue to operate as Castro's personally confjolled vehicles, thsjt they will be responsive to hisnd that FidtiLtma will be far nsore important thanhe* ideology.

Castro's personal rjredociinance willafor vulnerability of his regUne, Although we see virtually no chance of hu overthrow dunng tlir ne-et rear or ta there is eiwavs the ooasibillrv of his it nth bv illness or Oon.

Approved for

Original document.

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