CURRENT INTELLIGENCE BULLETIN - 1953/07/01

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02872226
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 8
• Document Creation Date: July 15, 2019
• Document Release Date: July 22, 2019
• Publication Date: July 1, 1953

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1 July 1953
Copy No. 6 7
CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO.
FO CH.NGE IN CLASS.
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(.;AD TO: TS 5007
tUTH: HR 704;44
EAT Epoat ff. REVIVVER:
3.5(c)
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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SUMMARY
GENERAL
Continued Soviet desire fpr Korean truce reported (page 3).
SOVIET UNION
2. Moscow embassy comments on Soviet currency reform denial (page 3).
FAR EAST
3. Anti-American comment rising sharply in Tapan (page 4).
SOUTHEAST ASIA
Z.e.** Negotiations for removal of Li IVIi troops from Burma reach
critical point (page 5).
AUSTRALIA - NEW ZEALAND
5. New Zealand officials see five-ppwer group eclipsing military
aspect of ANZUS (page 5),
NEAR EAST - AFRICA
Egypt threatens to adopt stronger policy on Suez base (page 6).
7, Egyptian Revolutionary Command Council renews request for
US arms (page 7).
EASTERN EUROPE
8. Comment on the reorganization of the Hungarian Workers Party
(page 7).
WESTERN EUROPE
9. Paris embassy reports Letourneau "out" of Indochina affairs (page 8).
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GENERAL
1. Continued Soviet desire for Korean truce reported:
The Soviet ambassador in Peiping confi-
dentially informed the Swedish ambassador
there that the Chinese demand for the re-
capture of all released Korean prisoners
should not be taken literally, according to the Swedish ambassador
in Washington. The Soviet ambassador stated that Rhee's coup had
"no military significance," and that if the US took a more resolute
line with Rhee it could prevent further sabotage, making it unneces-
sary to discuss India's proposal for the transfer of POW's outside of
Korea.
The Swedish ambassador gained the impres-
sion that the Soviet statements were intended to reach the US.
Meanwhile, Vyshinsky told the Swedish
ambassador in Moscow that since Rhee had tried to sabotage an
agreement it was now most important that every effort be concen-
trated on reaching an armistice, and that questions concerning the
political conference and the UN General Assembly must await an
armistice.
Comment: The USSR has previously used
its influence to advance the conclusion of an armistice and these con-
versations reveal continued interest in a truce,
The Communists at Panmunjom are currently
exploiting Rhee's action as a potentially divisive issue between the UN
Command and South Korea, but they have not suggested an intention to
refuse on this issue alone to conclude a truce.
SOVIET UNION
2. Moscow embassy comments on Soviet currency reform denial:
The American embassy in Moscow, comment3.3(h)(2)
ing on Finance Minister Zverev's public denial
that a currency reform is impending, notes the
3.3(h)(2)
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extraordinary sensitivity of the Soviet people to rumors affecting
their personal interests. The embassy sees no real reason for a
monetary reform at this time, and suggests that the scare may
have resulted from widespread rumors that new but not devalued
currency will be issued.
FAR EAST
3. Anti-American comment rising sharply in Japan:
Anti-American criticism is increasing 3.3(h)(2)
sharply in the Japanese press, according
to a Far East Command survey which notes
that the volume of adverse comment and
derogatory reporting in major urban and rural papers reached a
postoccupation high the week of 15 to 21 June. Critical comment
was 50 times greater than favorable coverage.
3.3(h)(2)
There was as much adverse comment
between 8 and21 June as during the entire first quarter of 1953.
Maneuver and base areas were the primary targets of press criti-
cism, although damages caused by air accidents and crimes by
military personnel were also emphasized.
Comment: The Communists, Leftist
Socialists and left-wing labor leaders have been successfully ex-
ploiting local opposition to American military bases in a nation-
wide campaign to arouse anti-American sentiment and discredit the
Yoshida government.
The growing anti-American campaign
might impede any American plans to move additional troops to
Japan following a Korean truce.
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SOUTHEAST ASIA
4. Negotiations for removal of Li Mt troops from Burma reach critical
point:
The work of the mixed committee in Bangkok3.3h)(2)(
has reached a critical point, according to
Ambassador Stanton. The Burmese repre-
sentative takes a serious view of statements
by the Nationalist field commanders who are now in Bangkok and the
Subsequent denial of any control over these statements by the Taipei
representative.
The statements repeated Taipei's earlier
arguments against withdrawal and implied that Burma is responsible
for alleged atrocities against overseas Chinese. Stanton feels the
situation is not hopeless if Taipei will order the generals to cooperate
and if their arguments are officially rejected by the United States.
Comment: Further doubt is cast on the
Nationalists' willingness to cooperate by the statement of a high
defense official in Taipei on 30 lune that negotiations cannot con-
tinue if only one party is asked to give ground.
Meanwhile, the chief Burmese delegate is
inder increasing pressure from the War OfficE3.3(h)(2)
in Rangoon to withdraw from the talks, although he and the Burmese
ambassador continue to oppose such action.
AUSTRALIA - NEW ZEALAND
5. New Zealand officials see five-power group eclipsing military aspect
of ANZUS:
The New Zealand army chief of staff has 3.3(h)(2)
expressed the opinion that five-power con-
ferences involving the United States, Great
Britain, France, Australia and New Zealand
will eventually transcend ANZUS as a military
planning group, with e latter existing only as a political body. He
said the New Zealand prime minister shared this view.
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The chief of staff also reiterated New Zealand's
intent to send forces to the Middle East in time of global war, but stated
that while his country would "do its bit" in the event of localized trouble
in Southeast Asia, the prospect of furnishing any considerable force was
slim.
Comment: As currently constituted, the in-
formal five-power liaison organization meets on an ad hoc basis to dis3.3(h)(2)
cuss military problems concerning Southeast Asia. Its evolution into a
more elaborate body with extended responsibilities would have consider-
able appeal for Britain
Australia, however, views such a development
with mixed feelings, fearing a possible lessening of Australian influence.
3.3(h)(2)
NEAR EAST - AFRICA
6. Egypt threatens to adopt stronger policy on Suez base:
Vice Premier Nasr has stated that if Egypt's3.3(h)(2)
offer on maintenance of the Suez base is not
accepted, Cairo will announce publicly that
Britain can retain no installations there and
will receive no assurances of the base's future
availability.
Nasr told American embassy officials that
this policy would be adopted if the British attitude on the base does
not change following Anglo-American discussions. He added that
meanwhile the army regime will "keep things quiet" but must con-
tinue "preparations for any eventuality."
Ambassador Caffery says the British belief
that a policy of firmness is responsible for the period of calm appears
dangerously at variance with the above statements.
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Comment: Egypt presumably hopes that
the United States will persuade Britain to modify its position on the
base. Disappointment is ltkely to lead to an outbreak of violence and
anti-Western sentiment.
7. Egyptian Revolutionary Command Council renews request for US arms:
Colonel Nasr and Major General Hakim Ami:3.3(h)(2)
the new commander in chief of the Egyptian
armed forces, have advised the American
embassy in Cairo that Egypt now desires to
secure some of the arms which the United States has agreed to supply.
The officers expressed interest in obtaining
"some showy items," such as tanks and armored cars, in order to
boost morale and strengthen Amir's position with the army. Nasr
offered assurances that any arms obtained would not be used against
the British.
Comment: Negotiations for the purchase by
Egypt of $11,000,000 worth of American arms were suspended in early
May in response to strong British representations following the break-
down of Anglo-Egyptian defense talks.
EASTERN EUROPE
8. Comment on the reorganization of the Hungarian Workers Party:
The reorganization of the top leadership of
the Hungarian Workers Party on 27 and 28 June is comparable to the
streamlining of the Soviet Communist Party following Stalin's death,
and may presage similar moves in other Satellite Communist parties.
The politburo has been greatly reduced to
nine members and two alternates, while the old secretariat has been re-
placed by a three-man group. In contrast to the change in the Soviet
Union, Premier Rakosi remains a member of both the political com-
mittee and the new secretariat, but his former position as secretary gen-
eral has been abolished.
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These personnel changes have brought to the
top a younger, stronger and more cohesive group of men who have
greater experience with the problems of a socialist economy. Several
former party leaders and Social Democrats who were of value to the
regime during the transitional period have been dropped from the polit-
buro. In view of the numerous indications that the government is pre-
paring to modify its economic policies, the new party leadership will
be able to claim credit for any concessions.
WESTERN EUROPE
9. Paris embassy reports Letourneau "out" of Indochina affairs:
The American embassy reports that Jean
Letourneau, minister and commissioner
general for the Associated States since
1950, is now "effectively out."
3.3(h)(2)
Vice Premier Paul Reynaud, who reportedly
will be responsible for Indochinese affairs, and Foreign Minister
Georges Bidault have not yet decided on the extent to which the Ministry
for Associated States should be "absorbed" into the Foreign Ministry.
Comment: The Foreign Ministry has been
Increasingly occupied with the international aspects of the Indochina
question. If Paul Reynaud assumes Letourneau's cabinet duties, he
may be expected to take a more liberal stand on independence for the
Associated States than Bidault.
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