CURRENT INTELLIGENCE BULLETIN - 1953/01/04

Document Type: 
Document Number (FOIA) /ESDN (CREST): 
02050110
Release Decision: 
RIPPUB
Original Classification: 
U
Document Page Count: 
7
Document Creation Date: 
July 15, 2019
Document Release Date: 
July 22, 2019
Sequence Number: 
Case Number: 
Publication Date: 
January 4, 1953
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PDF icon CURRENT INTELLIGENCE BULL[15671725].pdf193.55 KB
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Approved for Release: 2019/06/26 CO2050110 TOPS ET SECU INFORMATION 4 January 1953 3.5(c) opy No. c , CURRENT INTELLIGENCE BULLETIN NO CHANGE IN C Documoir NO. DECLASSIFIC-.0 CLAGS. CHANGED TO; TS NEXT REVIEW DATE; PIEVEWES: AVM 70 3.3(h)(2) DATE: Office of Current Intelligence CENTRAL INTELLIGENCE AGENCY 3.5(c) 3.5(c) o3. 5(c) TOP S ' T V SECU IN1FORMATION Approved for Release: 2019/06/26 CO2050110 A Approved for Release 2019706/26 CO2050110 ET SUMMARY FAR EAST 1. Three additional Chinese armies may have entered Korea (page 3). 2. Reconstruction of Hainan's port facilities progressing (page 3). 3. 4. NEAR EAST - AFRICA Britain outlines new plan /or approacn to Egypt (page o). 5. Britain, France and Italy seen hoping for eventual collapse of Libya (page 5). WESTERN EUROPE 7. Comment on possibility of devaluation of French franc (page 7). * * * -2-. 3.5(c) 3.3(h)(2) 3.3(h)(2) 3.5(c) 3.5(c) /Approved for Release: 2019/06/26 CO2050110 Approved for Release: 2019/06/26 CO2050110 RET FAR EAST 1. Three additional Chinese armies may have entered Korea: On 1 December the Chinese Communist High Command in Korea made arrangements to move an additional army group into the pen- insula, This army group, composed of nine infantry divisions and one armored division, reportedly was part of the Second Field Army and was to move into Korea around 1 January, 3.5(c) 3.3(h)(2) 3.3(h)(2) Comment: Elements of at least two and pos- sibly three new armies in Korea 3.3(h)(2) during the past week, but these elements were identified as subordinate to the Third Field Army. Three additional armies, which normally com- prise an army group, would increase Chinese Communist strength in Korea by approximately 100,000 men. 2. Reconstruction of Hainan's port facilities progressing: of Hainan, 3.3(h)(2) The raising of sunken ships in the harbor, how- ever, has not yet started. 3.3(h)(2) Construction work at Haikou, on the north coast was described as "urgent." Comment: The island of Hainan has been the scene during the past year of a military and economic build-up. Haikou and Yulin are the two principal ports. 3 TO CRET Approved for Release: 2019/06/26 CO2050110 3.5(c) Approved for Release: 2019/06/26 CO2050110 TOP RET 3.5(c) At Haikou, the Communists are concentratin on dredging activities,/ At Yulin, where ships sunk during World War II have made entry into the harbor hazardous, the Communists have begun work on a vessel salvage program. NEAR EAST - AFRICA 4 3.3(h)(2) 3 .3(h)(2) 3.5(c) "Approved for Release: 2019/06/26 CO2050110 Approved for Release: 2019/06/26 CO2050110 TOP SEC1ET 3.5(c) 4. Britain outlines new plan for approach to Egypt: As part of its "package proposal" for the settlement of the Anglo-Egyptian dispute, Britain proposes to resume supplying military equipment to Egypt by stages. In order to reap the greatest advantage, Britain will not release any further supplies until Anglo-Egyptian negotiations are under way and will withhold the most important items until agreement has been reached. Ambassador Caffery in Cairo strongly ad- vises against American acceptance of the proposal. Instead, he recommends that the United States immediately implement a pro- gram of interim military and economic assistance which the State Department is presently preparing. Comment: The current impasse in the Sudan discussions plus a likely strong Egyptian aversion to bargaining with Britain on arms may result in a complete Anglo-Egyptian impasse which would play into the hands of the extremists. Reports from Egypt indicate growing Moslem Brotherhood impatience with lack of progress on the Suez issue and warn of possible outbreaks of terrorism. 5. Britain, France and Italy seen hoping for eventual collapse of Libya: US Minister Villard in Tripoli concludes, after reviewing Libya's first year of in- dependence, that Britain, France and Italy are waiting hopefully, "like vultures," to claim a dismembered Libyan "carcass." He maintains that the three powers are more interested in the eventual division of Libya's three provinces - Cyrenaica, the Fezzan and Tripolitania - among themselves than in the promotion of a strong centralized government. 5 3.3(h)(2) 3.3(h)(2) TOP SECRET ----Approved for Release: 2019/06/26 CO2050110 3.5(c) Approved for Release: 2619/06/26 CO2050110 This division of Libya may not happen in the immediate future, the Minister says, but long range planning must consider the possibility that Libya may cease to exist as a sovereign state. Comment: To this picture of Libya's future must be added the prospect that, even if it survives, Libya's growing alignment with intemperate Arab nationalism entails problems for the West. Current American, British and French negotiations on military bases are already stalemated bya Libyan desire to re-examine its foreign commitments. WESTERN EUROPE 6 3.5(c) TM Approved for Release: 2019/06/26 CO2050110 3.5(c) Approved for Release: 2019/06/26 CO2050110 TOP SECRET 3.5(c) 3.3(h)(2) 7. Comment on possibility of devaluation of French franc: The continued sharp deterioration of France's account with the European Payments Union creates the possibility that the next government will immediately devalue the franc.. The official exchange rate of the franc has long been considered further out of line than that of any other West European currency. Since the franc probably must be devalued eventually, any new French administration may do so immediately in Order to avoid incurring the sole blame for such a step. The next government may also prefer to act before a further decline in French foreign exchange holdings would make it even more difficult to sta- bilize the franc at the newly determined rate. France's deficit with the European Payments Union has been averaging nearly $40,000,000 a month for the past year and a half, and commencing with November 1952 has necessitated settle- ments entirely in gold. Despite the poor prospects for any substantial reduction of the monthly deficit, Premier Pinay rejected a devaluation of the franc in favor of measures which stressed creation of a "climate of confidence." His position was strengthened by scheduled American aid, which will permit France to apply the bulk of its dollar receipts from other sources to settlement of its Payments Union deficit, at least through February. 7 3.5(c) /Approved for Release: 2019/06/26 CO2050110