CURRENT INTELLIGENCE BULLETIN - 1954/08/11

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03000925
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 7
• Document Creation Date: August 20, 2019
• Document Release Date: August 30, 2019
• Publication Date: August 11, 1954

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11 August 1954
Copy No.
CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO.
NO CHANGE IN CLASS x,
1.1 DECLASSIFIED
CLASS. CHANGED TO: TS S C
NEXT REVIEW DATE:
AUTH: HR 70-2
DATE: 1 "3...% 110 REVIEWER
ad.
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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SUMMARY
FAR EAST
1. Comment on Japanese criticism of American policy (page 3).
SOUTHEAST ASIA
2. Partition of Laos seen result of Geneva agreements (page 3).
3. British official questions Cambodian inclusion in SEATO (page 4).
SOUTH ASIA
4. Ambassador Allen believes Nehru "sold" on Peiping's peaceful inten-
tions (page 4).
NEAR EAST - AFRICA
5. Henderson warns Iran will require additional assistance (page 5).
WESTERN EUROPE
6. Portuguese protest American silence on Indian "aggression" (page 6).
LATIN AMERICA
7. Brazilian military leaders reported planning to force president's
resignation (page 6).
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FAR EAST
1. Comment on Japanese criticism of American policy:
Hayato Ikeda, new secretary general of
Prime Minister Yoshicia's Liberal Party,
stated publicly on 9 August that the party's
policy must be revised because of the failure of American foreign
policy on Indochina and Communist China. His statement indicates
an effort to gain political benefit from growing popular sentiment
for closer relations with the Communist bloc.
Ikeda's emphasis that Japan must follow
the British line in the Far East will appeal to the strong neutralist
sentiment in Japan. It also may blunt opposition criticism that
Yoshida's attitude toward Peiping is only "lukewarm."
While Japan's dependence on the United States
precludes any early radical change in its orientation, Ikecia,'s state-
ment points up a trend in the government to pursue a more independ-
ent foreign p na Pilla vliT in relations with Communist China
and the USSR
SOUTHEAST ASIA
2. Partition of Laos seen result of Geneva agreements:
at Geneva has confirmed the vievilhat Jiaos
will in effect be partitioned by the regroup-
ment of "Pathet Lao" militia in the two
northern provinces of Phong Saly and Sam Neua. Redeployment of
these forces will mean the early consolidation of Communist control
over these two provinces.
Comment: The Laotian cease-fire agree-
ment makes no reference to partition. The fiction of the kingdom's
integrity is maintained in the Laotian government's declaration that
it will provide special representatives in the provinces set aside
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for the regroupment of "Pathet Lao" forces. The entry into these
provinces of Laotian and French military forces, however, is
banned by the agreement.
The Communists' position in the north,
with access both to China and to Viet Minh-controlled Tonkin, gives
them a firm base from which to expand their influence southward.
3. British official questions Cambodian inclusion in SEATO:
British and French representatives in Phnom
Penh have expressed differing views regard-
ing the desirability of Cambodian participa-
tion in a Southeast Asian defense pact, the
American consul there reports. The British charg�dmitted that the
cease-fire agreement gives Cambodia this right, but believes his
government maintains that Chou En-lai received unwritten assurances
that both Laos and Cambodia would be "neutralized." Thus, he be-
lieves, Secretary Eden opposes such participation as unnecessarily
provocative to Communist China.
The French acting high commissioner, on the
other hand, believes Cambodia is entirely free to join such a pact and
that this would be desirable. He said, however, that Cambodian member-
ship should be delayed until Viet Minh troops had withdrawn from south
Vietnam, in order to avoid having the Viet Minh slip troops across the
border into Cambodia.
Comment: Last-minute concessions won by
the Cambodians at Geneva appear clearly to establish Cambodia's right
to join in a regional defense organization,
SOUTH ASIA
. Ambassador Allen believes Nehru "sold" on Peiping's peaceful intentions:
Following a conversation with Prime Minister
Nehru on 9 August, Ambassador Allen reported
his belief that Nehru has been "sold" on the
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proposition that Communist China has no aggressive designs, at
least for the next decade. Nehru reiterated his opposition to any
collective security pact involving South Asia, even if it were con-
fined to some or all of the Colombo powers.
Nehru said he did not believe there was any
danger that South Asian nations would fall to the Communists one by one
if each adopted his policy of no military commitments, as China desired
peace to work out its own proble:ms. He was confident, however, that
outright Chinese aggression against Burma would lead to a world war
without any specific commitment on the part of others to aid that coun-
try. He believed Peiping shared this view.
Comment: Nehru's statements to Allen are
in essence those he has frequently made in the past when speaking for
public or foreign diplomatic consumption. Actual measures taken and
plans reported made by the Indian army, presumably with Nehru's
approval, indicate a much greater suspicion of Peiping's intentions.
NEAR EAST - AFRICA
5. Henderson warns Iran will require additional assistance:
Ambassador Henderson is optimistic that
Tudeh efforts to block Majlis approval of
the oil agreement will be unsuccessful. He
warns, however, that the agreement will
not solve Iran's problems, and that the country will continue to need
American aid and guidance.
Income from oil, he states, will not cover
urgent Iranian budget requirements during the next three years. There
is also a pressing need for modest economic development, and certain
military requirements can be satisfied only by additional American
assistance.
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WESTERN EUROPE
6. Portuguese protest American silence on Indian "aggression":
Portuguese foreign minister Cunha, in a talk
with Ambassador Guggenheim on 9 August,
protested "with great bitterness" Washington's
unwillingness to take a public stand condemn-
ing Indian aggression against Portuguese territories on the subcontinent.
Pointing out that Britain and several other
nations had taken such a stand, Cunha said he was convinced that
American reasoning derived from a "mistaken policy of anticolonialism"
which is no way applied to Goa.
Emphasizing previous Portuguese co-operation
with the United States, he said that if the Portuguese territories were
taken over without any statement from Washington, there would be changes
in Portuguese policies. He mentioned specifically NATO and the Ameri-
can bases in the Azores.
Guggenheim comments that this last statement
is a "scarcely veiled threat not to extend the Azores agreement."
Comment: The advantages of good relations
with the United States would appear to outweigh the importance of the
small territories in India. The Portuguese, however, believe strongly
in their constitutional principle that these territories are an integral
part of Portugal. Cunha's views are believed to be a faithful reflection
of his government's position.
LATIN AMERICA
7. Brazilian military leaders reported planning to force president's
resignation:
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The American embassy in Rio de Janeiro
reported on 10 August that the situation was "extremely fluid." The
embassy believes that if the plans to force Vargas' resignation are
carried out, energetic measures will probably be taken immediately
to prevent Communist exploitation of the political and economic situa-
tion.
Comment: The Military Club elections,
which are regarded as a test of strength of army factions, showed last
May the strength of the victorious anti-Vargas forces. Three months
earlier Vargas had been forced to dismiss his labor minister as a
result of army protests over deteriorating economic conditions and
the growing threat of Communist infiltration in government.
In view of the widespread repercussions of
the Lacerda incident, it is possible that the anti-Vargas military
groups will try to force Vargas' resignation. Even if Vargas remains
in power, the incident will severely handicap the administration in
the 3 October congressional elections.
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