CURRENT INTELLIGENCE BULLETIN - 1953/09/18

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02869409
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 9
• Document Creation Date: July 15, 2019
• Document Release Date: July 22, 2019
• Publication Date: September 18, 1953

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SECUR ORMATION
18 September 1953
Copy No. 67
CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO. 6
NO CHANGE IN CLASS.
O DECLASSIFIED
CLASS. CHANGED TO: TS SC
NEXT REVIEW DATE. _e0 03
AUTH: tin 70-2
DATE: /..9j/2/729.,REVIEWEF
3.5(c)
Office of Current Intelrigence
CENTRAL INTELLIGENCE AGENCY
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SUMMARY
FAR EAST
Japanese defense plan emphasizes air power (page 3).
SOUTHEAST ASIA
Comment on Burmese withdrawal from four-power committee
(page 3).
3.. Indonesian government concerned over autonomous movement in
North Sumatra (page 4).
4.
SOUTH ASIA
5. Ceylonese ambassador raises possibility of ending rubber trade
with China (page 5).
NEAR EAST - AFRICA
1(Zahedi desires early Majlis election (page 6).
Iranian prime minister has not seriously considered oil solution
(na P 61_
8.
3.3(h)(2)
3.3(h)(2)
WESTERN EUROPE
\FietLaniel and Bidault to push for French EDC ratification this year
(page 7).
Ote Laniel government seen stronger (page 8).
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FAR EAST
1, Japanese defense plan emphasizes air power:
Air power is emphasized in pending
Japanese defense plans. These en-
visage the development of a 1,400-
plane air force and a supporting aircraft
rs,
Thgaulthexpaiiilon of the
orces rom 110,000 to 150,000 in the next year. Naval
forces will be increased, but primary reliance will be placed on
American naval power for strategic defense.
industry in the next
Comment: The government and Liberal
Party are seeking a plan which can be used by Japanese officials
visiting Washington to bargain for United States assistance and for
economic concessions without exceeding the limit of "war potential"
set by the Japanese constitution.
Emphasis on the development of an air
force is probably designed to appeal to the public as provision for
an all-around defense based on Japan's national interests rather
than as a move to qualify for American aid.
SOUTHEAST ASIA
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2. Comment on Burmese withdrawal from four-power committee: 3.5(c)
The withdrawal of the Burmese delega-
tion on 17 September from the four-power committee in Bangkok
appears to eliminate all possibility of a negotiated evacuation of
Chinese Nationalist forces from Burma. After nearly four months
of talks marked by increasing Burmese impatience with Taipei's
procrastination, the walkout was precipitated by Chinese rejection
of a demand that 5,000 troops be evacuated within 35 days of the
signing of the evacuation plan and the rest within three months.
The Burmese government will now feel
compelled to take strong action against the Nationalists. It is
practically certain that it will seek UN condemnation of Taipei
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TC,SE
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as an aggressor, and that it anticipates considerable support for
this charge. Burmese army units
deployed against the Nationalists have been strengthened and they
may be expected to launch an all-out military campaign. Some
important government leaders are also known to be considering
an approach to Peiping for military assistance.
On 16 September, a highly influential
cabinet minister told the American ambassador that his govern-
ment and people were rapidly losing faith in the UN's ability to
protect small countries, and that Burmese leaders have seriously
debated a withdrawal from the UN.
3. Indonesian government concerned over autonomous movement in
north Sumatra:
"that the situation is tense in
Atjeh, an area of North Sumatra, where
an autonomous movement has long ex-
isted. Indonesian army reinforcements have been sent there and
European plantation families have been evacuated.
Comment: The Atjehnese are a primi-
tive people who were never fully under control by the Dutch
during their long rule of Indonesia.
Vice President Hatta visited Atjeh in
July in an effort to forestall a declaration of autonomy, and in
August the new government ordered the ministers of defense and
interior to investigate the situation.
4
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4.
SOUTH ASIA
5. Ceylonese ambassador raises possibility of ending rubber trade with
China:
3.3(h)(2)
Attributing his approach to recent political 3.3(h)(2)
unrest in Ceylon and to the possibility that
current trade negotiations with Communist
China might fail, the Ceylonese ambassador
in Washington on 14 September sounded out the United States "position"
on Ceylon. He implied that with American assistance Ceylon might be
able to "get back into step with the free world" by letting its trade
agreement lapse.
Comment: The Ceylonese government,
which is now negotiating the Ticc-71-a-year terms of its five-year trade
pact with China, is apparently weighing the short-range benefits to be
gained from that trade against the longer range ones which might re-
sult from a resumption of American financial and technical aid and
private investment.
5
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Ceylon may also fear the annual loss of
at least $10,000,000 in premium profits from the China rubber trade
If peace in Korea leads to a relaxation of trade controls and competi-
tion from Indonesia and Malaya. Since Ceylon is in a bad financial
position, the government may also be seeking new sources of devel-
opment funds.
NEAR EAST - AFRICA
6. Zahedi desires early Majlis election:
In a conversation with Ambassador
Henderson on 14 September, Prime
Minister Zahedi expressed the belief
that he could arrange to hold new
Majlis elections by 1 December, despite certain risks involved.
He believed it necessary to take these risks in order to have a
Majlis to cooperate in improving Iran's financial situation.
While the shah would like to postpone the
installation of a new Majlis until July, Zahedi would prefer the dis-
solution of the present body and convocation of a new one.
Comment: Long-term relief of the
Iranian financial problem depends in large measure upon an effective
Majlis. This body must enact any increased taxation, ratify an oil
settlement, and approve loans from abroad.
The present regime will be vulnerable
to charges of dictatorial rule unless a properly constituted parlia-
ment exists. If the new Majlis is not chosen soon, the opposition
elements will have an opportunity to accumulate strength.
7. Iranian prime minister ha � not seriously considered oil solution:
Prime Minister Zahedi has not yet given
serious attention to settling the Iranian
oil dispute with Britain, Ambassador
Henderson reported on 16 September.
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8.
Zahedi seemed "totally unacquainted" with the details of the problem,
although he appeared to realize the difficulties of establishing markets
for Iran's oil. He stated that he would prefer to use channels for nego-
tiations acceptable to the British, but emphasized that it would be ex-
tremely difficult to work outside the framework of the 1951 nine-point
oil nationalization law.
Comment: This strengthens the impression
that considerable time will probably elapse before oil talks can actually
begin.
WESTERN EUROPE
9. Laniel and Bidault to push for French EDC ratification this year:
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Ambassador Dillon in Paris thinks that 3.3(h)(2)
for the first time the French government
is prepared to launch an aggressive campaign
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for EDC ratification. In the past two days both Premier Laniel and
Foreign Minister Bidault have expressed their determination to se-
cure ratification before the end of the year. Bidault said that he
would attempt to persuade 35 or 40 influential deputies who are un-
decided or opposed.
Laniel feels well qualified to lead the
fight because he combines a resistance record with influence on the
political right and, unlike Bidault, has not been closely identified
with EDC from the beginning.
Bidault told Ambassador Dillon of his
confidence that a satisfactory Saar settlement can be reached and
that under present circumstances four-power talks would not affect
the EDC issue.
Comment: French opponents of the EDC
have been more vocal in the past year than its supporters, and the
attitude of the undecided deputies, whose votes will be decisive, is
not yet clear. The outcome of the Saar issue may determine their
vote.
French-German negotiations on the Saar
are not expected to begin before mid-October. In view of the con-
siderable unresolved differences, they will probably be protracted
and seriously weaken Bidault's optimism on early EDC ratification.
10. Laniel government seen stronger:
French finance minister Edgar Faure
told Ambassador Dillon on 15 September
that he considers the Laniel government
"much stronger" that it is generally be-
lieved to be. He feels that there is no longer a possibility that
Mendes-France can form a left-center government, since recent
events in North Africa have deprived him of Popular Republican
support.
8
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Comment: Ex-premier Faure's
statements may be colored by the fact that he was responsible
for the government's economic program. Moreover, he has
reportedly broken with his Radical-Socialist colleague Mendes-
France, with whom he had worked closely during the last cabinet
crisis.
If the government can quiet labor dis-
content, which is expected to flare up during the fall, Laniel
probably will be able to remain in power until the presidential
elections in December.
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