Foreign Relations of the United States, 1955–1957, Soviet Union, Eastern Mediterranean, Volume XXIV

276. National Intelligence Estimate²

NIE 32–55

Washington, January 18, 1955.

THE OUTLOOK FOR GREECE³

The Problem

To estimate the current situation and probable developments in Greece over the next three or four years.

Conclusions

1. Greece has seldom enjoyed real political and economic stability and remains handicapped by its poverty of natural resources and by the volatility of a political system in which foreign influences still play an important part. Since World War II, however, Greece has with US and UK assistance crushed the Communist effort to seize power through force, repaired the tremendous damage brought about by the war, and made a start toward building up the economy. Moreover, since the installation of Premier Papagos in 1952, the Greek Government has had a degree of popular support and political effectiveness unusual since World War I. (paras. 9–11)

2. So long as Papagos retains active leadership, we believe that the present Greek Rally government will remain in power at least up to the 1956 elections. Although some deterioration of the Rally’s cohesiveness and prestige has recently taken place, probably presaging an increase in political intrigue, and some decline in the government’s strength and effectiveness, it is unlikely that sufficient Rally deputies will defect to overturn Papagos’ now comfortable majority. On the basis of present indications, if Papagos is still active and on the political scene, the Rally will probably win the 1956 elections, though as compared with its showing in 1952 it will inevitably suffer some loss of electoral strength, (paras. 21, 23)

3. If Papagos, who is now 72, should die or become incapacitated, the Rally would soon fall apart, and the centrist Liberal Party would replace it as the strongest political grouping. Since even the Liberals would lack a parliamentary majority in their own right and would probably be unable to gain one in new elections, the eventual outcome would probably be a series of unstable coalition governments, marked by political fragmentation and an increase both in Palace influence and in Communist opportunities for political maneuver. Under such circumstances, there might be an attempt at dictatorship by the secret military society, IDEA, although this would depend to a large degree on IDEA’s estimate of the US reaction, (para. 22)

4. The Greek economy will probably remain fairly stable over the next three or four years despite a decline in US aid; some modest improvements in production and in Greece’s foreign exchange position may take place. In the longer term it is improbable that a politically acceptable standard of living can be maintained without some form of economic assistance unless there is a reduction in Greece’s contribution to its defense budget. (paras. 29, 30)

5. Regardless of internal political developments, Greece’s strongly pro-Western orientation is unlikely to change over the next few years. The US in particular is likely to retain its present predominant influence in Greece, although Greek responsiveness to US advice may decline somewhat as a result of the progressive reduction of US aid and the US position on enosis (union of Cyprus with Greece). (paras. 43–45)

6. The British are seeking to restore their influence in Greek internal affairs. While they share the basic US interest in maintaining a stable, non-Communist Greece, they also desire to protect their special interests and influences. They desire a Greek Government more amenable to their influence than the present one and have been particularly irritated by Papagos’ advocacy of enosis. (para. 17)

7. Although the enosis issue is likely to be a continuing irritant in Greek relations with the UK, Turkey, and the US, it is unlikely that Greece’s alliances with these powers will be strained by this or any other issue. Greek relations with its non-Satellite neighbors will probably continue to improve slowly, though underlying suspicions and conflicts of interest will remain, (paras. 46, 47)

8. The development of Greek military capabilities is progressing satisfactorily with continuing US training and material assistance, and the Balkan Alliance military planning has made satisfactory progress.⁴ However, growing Greek reluctance to maintain present levels of military expenditures is likely to make the maintenance of a military establishment meeting NATO and US requirements depend increasingly on assistance for meeting military expenses. (paras. 34, 35)

[Here follows the remainder of the Estimate.]

2. Source: Department of State, INR–NIE Files. Secret. National Intelligence Estimates (NIEs) were high-level interdepartmental reports presenting authoritative appraisals of vital foreign policy problems. NIEs were drafted by officers from those agencies represented on the Intelligence Advisory Committee (IAC), discussed and revised by interdepartmental working groups coordinated by the Office of National Estimates of the Central Intelligence Agency (CIA), approved by the IAC, and circulated under the aegis of the CIA to the President, appropriate officers of Cabinet level, and the National Security Council. The Department of State provided many political and some economic sections of NIEs.

3. According to a note on the cover sheet:

   “The following organizations participated in the preparation of this estimate: The Central Intelligence Agency and the Intelligence organizations of the Department of State, the Army, the Navy, the Air Force, and The Joint Staff.

   “Concurred in by the Intelligence Advisory Committee on 18 January 1955. Concurring were the Special Assistant, Intelligence, Department of State; the Assistant Chief of Staff, G–2, Department of the Army; the Director of Naval Intelligence; the Director of Intelligence, USAF; and the Deputy Director for Intelligence, The Joint Staff. The Atomic Energy Commission Representative to the IAC and the Assistant to the Director, Federal Bureau of Investigation, abstained, the subject being outside of their jurisdiction.”

   In a memorandum of January 28, Armstrong forwarded a summary of NIE 32–55 to Secretary Dulles. (Ibid., Central Files, 781.00/1–2855)

4. On August 9, the Foreign Ministers of Greece, Turkey, and Yugoslavia signed the Treaty of Alliance, Political Cooperation, and Mutual Assistance at Bled, Yugoslavia. The agreement, which supplemented a February 25, 1953, Treaty of Friendship and Collaboration, was often referred to as the Treaty of Bled, the Balkan Pact, or Balkan Alliance, and sought primarily to guarantee the territorial integrity and political independence of the member states. The accord entered into force upon final ratification by the three parties on May 15, 1955. For text, see Documents (R.I.I.A.) for 1954, p. 197.