CURRENT INTELLIGENCE BULLETIN - 1952/06/12

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02064593
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 9
• Document Creation Date: May 24, 2019
• Document Release Date: May 30, 2019
• Publication Date: June 12, 1952

Approved for Release: 2019/05/08 CO2064593
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SEC Y INFORMATION
12 June 1952
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CURRENT INTELLIGENCE BULLETIN
DoCover NO.
NOCHANGE IN CLASS.
DECLASSPED
CLASS. CHANGED TO: TS S C
l'4EXT REVIEW DATE: if),�it6
AM: 70-
DATE:
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Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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SUMMARY
GENERAL
1. Four-power talks on Germany viewed as enhancing Western
position (page 3).
2, France favors coordinating Yugoslav defense plans with West
(page 3).
FAR EAST
3. USSR grants secret credit to China (page 4).
4. Letourneau discusses Indochina on eve of Washington visit
(page 4).
5. Karen insurgent leader reported in Formosa (page 5).
6.
7,
NEAR EAST-AFRICA
Iranian official predicts possible military coup (page 6).
WESTERN EUROPE
expects Soviet-East German contractual
relationship (page 6).
8. Portugal unwilling to reveal secret Azores agreements to NATO
(page 7).
LA TIN AMERICA
9. Bolivian tin nationalization appears more certain (page 8).
10. Venezuela reportedly attempting to provoke break with the USSR
(page 8).
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GENERAL
1. Four-power talks on Germany viewed as enhancing Western position:
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Foreign Secretary Eden and Foreign Mini-3.3(h)(2)
ster Schuman consider the French proposal
to hold immediate four-power talks on Ger-
many a tactical move which would strengthen
public support of the Western position. They
feel the talks would put the Soviet Union on
record as opposing German unification and
would make clear its responsibility for the
breakdown of exchanges on the subject.
The American Embassy in Paris attributes
Schuman's change of opinion largely to domestic political reasons.
The British Foreign Office states that Eden arrived at his present
position after consulting British authorities in Germany, who evi-
dently believe that pressing for quadripartite talks will enchance the
Western position there.
Comment: The present French and British
views on the desirability of four-power talks are in almost complete
contrast to those expressed by Schuman and Eden in their conversa-
tions with Secretary Acheson two weeks ago.
American officials have argued that four-
power talks at this time will almost certainly prevent early West
German ratification of the Allied-German contractual agreement
and the Defense Community treaty.
2. France favors coordinating Yugoslav defense plans with West:
France favors an early understanding with
the United States and Britain on a joint ap-
proach to Yugoslavia on technical defense
planning,
but considers it premature to bring up the question within
the NATO framework.
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The French Government believes that the
NA TO Standing Group is the only body qualified to study the question,
but that actual conversations should be conducted according to Yugo-
slav preferences, possibly through three separate military missions
which could coordinate closely with NA TO.
Comment: France fears that the Standing
Group's prerogatives are being usurped by SHAPE to the detriment of
French influence.
Although Yugoslavia opposes formal military
agreements with NATO, the Tito regime would probably be amenable
to informal approaches along the lines suggested by Paris.
FAR EAST
3. USSR grants secret credit to China:
A detailed analysis
discloses that Soviet deliveries of
goods to China in 1951 under credit arrange-
ments totalled about 155,000,000 dollars.
The ptiblicized credit agreement signed by Peiping and Moscow in
February 1950 obligated the Russians to extend to China a credit of
only 60,000,000 dollars annually for five years.
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Comment: Many reports have stated that the
USSR has granted secret credits to China in addition to the known
amount of the 1950 agreement. The additional credit enables Peiping
to conserve its depleted reserves of Western foreign exchange and to
curtail sharply purchases from non-Orbit areas.
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4. Letourneau discusses Indochina on eve of Washington visit: 3.3(h)(2)
Minister-Resident Letourneau has suggested
informally to an American official in Paris
the establishment of two tripartite bodies,
one to discuss the political aspects of Indo-
international role, and the other the military.
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The best the French can hope for, according
to the Minister-Resident, is to hold on until "the general international
situation has improved sufficiently for us to negotiate a settlement."
The American Ambassador infers that this remark envisaged inclusion
of Indochina in an over-all Far East settlement, but suggests that a
definite exposition of French thinking, both on this question and the
possibility of negotiations with Ho Chi Minh, be sought in discussions
with Letourneau next week in Washington.
Comment: As a preparatory step toward
long-desired tripartite negotiations on Indochina some French officials
in Saigon have recently suggested transforming their High Commission
into a roving mission responsible for over-all supervision of French
interests in Southeast Asia and the Pacific area.
There is still no confirmation of the many
recent rumors that the French have been seeking to negotiate with
Ho Chi Minh,
5. Karen insurgent leader reported in Formosa: 3.3(h)(2)
An important leader of the Karen insurgents
in Burma was flown to Taipei in April
\ The loca
I press reported on 11 June that the same per-
son was in Taiwan discussing the possibility of cooperating with the
Chinese Nationalist troops in northeast Burma to prevent Chinese
Communist aggression.
Comment: Although this information cannot
be confirmed, there have been previous reports of contacts between
the Karen insurgents and the Chinese Nationalist forces. These reports
are supported by the statement made by the Burmese Minister of Karen
Affairs to an officer of the American Embassy in Rangoon that the
Karens in eastern Burma had recently received considerable numbers
of American rifles, with which the Chinese Nationalists are known to
be well supplied.
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NEAR EAST - AFRICA
6. Iranian official predicts possible military coup:
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Prime Minister Mossadeq does not have 3.3(h)(2)
the support of the Iranian public, the Senate,
Majlis or the Shah, former Iranian UN repre-
sentative Abul Panahi told the American Am-
bassador on 6 Surxe. As a result of growing alarm over the financial
crisis, Mossadeq will no longer be tolerated,
Panahi stated that if the Shah did not soon
replace the Prime Minister, a military coup would take place. He
added that a discussion of the possibility of a coup was even then taking
place, but that he had refused to attend.
Comment: Prime Minister Mossadeq's
position has appreciably weakened during the last two months. There
Is no firm evidence, however, that his control of the government is
as yet seriously threatened or that the Sliah is ready to take action
against him.
While current press reports of an attempted
army coup support Panahi's account of army intrigue against the Prime
Minister, there is no evidence that the army leadership is either willing
or able to carry out a successful coup without the Shah's approval.
WESTERN EUROPE
expects Soviet-East German contractual
relationship:
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anticipates that
the Soviet Union will react to the Bonn and
Paris treaties with open rearmament of
East Germany and some form of contractual
relationship.
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East German Deputy Premier Ulbricht re-
portedly told a 6 May meeting of representatives
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of East German mass organizations that the3.3(h)(2)
Soviet Control Commission is to be dissolved
leaving only Soviet diplomatic representatives.
He added that the East German Government
is to acquire sovereignty and will then ask the West for new Berlin
agreements on the grounds that the Potsdam and subsequent agreements
have been invalidated by this new status. He concluded by stating that
if new agreements are unobtainable, traffic to and from Berlin will be
restricted.
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plans for an alliance whereby the Soviet Union would protect the Ger-
man Democratic Republic against Western aggression. The alliance
would be dissolved upon German unification.
Comment: Conclusion of such an agreement
for East Germany and the�arii6rution of the Soviet Control Commission
would be consonant with the Soviet policy of ostensibly paralleling in
East Germany the development of the Bonn, republic.
8. Portugal unwilling to reveal secret Azores agreeipents to NATO:
Portugal's permanent NATO representative
has informed an American official in Paris
that his government does not want the secret
arrangements negotiated under the US-Portu-
guese Azores defense agreement to be communicated to the NATO
Standing Group. According to the Portuguese diplomats the Lisbon
government wishes by this means to prevent other NA TO members
from soliciting facilities in the Azores similar to those granted the
United States.
Comment: The Portuguese Government has
always insisted that it could not recognize N.ATO's authority to interfere
in the details of the Azores agreement.
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As for extending peace-time military facilities
to other NATO members, the Azores treaty reserves Portugal's right
to grant such privileges only to Great Britain, Current Portuguese
reservations in this matter, therefore, appear to be directed primarily
against France, the third member of NATO's Standing Group.
LA TIN AMERICA
9. Bolivian tin nationalization appears more certain:
At ceremonies swearing in the Tin Nationa.3(h)(2)
ization Study Commission, President Paz
Estenssoro called on Bolivians to brace
themselves for the "most transcendental and
vital step since independence, namely nationalization, which is the
principal goal and justification for the revolution." He discounted
the operational problem and expressed belief that a solution could be
found for the financial and commercial problems.
Comment: This contrasts sharply with
earlier descriptions of PIET7T-ra-no erate" attitude, and may indicate
that the influence of extremist Minister of Mines Lechin still pre-
dominates.
The tin nationalization measures are to be
applied only to the three principal producers, who control approxi-
mately 80 percent of Bolivian tin production.
10. Venezuela reportedly attempting to provoke break with the USSR
Venezuelan authorities on 7 rune refused
entry to Soviet "courier" Yakushev and his
wife. The Venezuelan chief of protocol is
reported to have said that if the USSR does
not break relations as a result of the "evident insult," it will be clear
that the Russians have s me "impelling reason" for remaining.
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Comment Rumors that Venezuela would
break relations with the USSR have cropped up periodically since mid-
1949, but this is the first "incident" of any kind. The Venezuelan
action bears a strong resemblance to the Cuban moves which pre-
ceded the break there last April. A decision to close the Caracas
Embassy would leave only three Soviet diplomatic missions in Latin
America -- in Mexico, Uruguay and Argentina.
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