CURRENT INTELLIGENCE BULLETIN - 1954/07/04

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03001375
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 8
• Document Creation Date: August 20, 2019
• Document Release Date: August 30, 2019
• Publication Date: July 4, 1954

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4 July 1954
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CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO.
NO CHANGE IN CLASS.
CI DECLASSIFIED
CLASS. CHANGED TO: TS S C
NEXT REVIEW DATE: 40/0
AUTH: FIR 70-2
RATE: -_-.7.11.450_ REVIEVVE
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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SUMMARY
GENERAL
I. Impasse reached in Balkan military alliance negotiations (page 3).
SOVIET UNION
2. Comment on second Soviet note on Tuapse (page 3).
SOUTHEAST ASIA
3. French defense planning excludes. most of Laos (page 4).
4. Anti-Western feeling among Vietnamese becoming more open
(page 6).
NEAR EAST - AFRICA
5. UN observer believes Israelis may attack Old City of Jerusalem
(page 7).
WESTERN EUROPE
6. 'I'rieste settlement depends on territorial
adjustments (page 7).
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GENERAL
1. Impasse reached in Balkan military alliance negotiations:
Representatives of Greece, Turkey, and
Yugoslavia, cgrrently meeting in Athens to
draft a tripartite military alliance, have
reached an impasse. Meetings of the full
delegations have been suspended, according to Alexis Kyrou, director
general of the Greek Foreign Ministry. He told the American ambassa-
dor that the controversial issue was Yugoslavia's unwillingness to as-
sume military obligations in the event Greece or Turkey became en-
gaged in conflict as the result of their NATO obligations. Kyrou
believes it may be necessary to leave this question to the tripartite
council of ministers to resolve when it meets in Belgrade later this
month.
Comment: This is the first indication of
potentially serious differences in the negotiations. In view of the strong
mutual desire for an alliance, however, there will probably be only a
temporary slowdown.
The alleged reluctance on the part of the
Yugoslays may be a bargaining tactic to obtain stronger commitments
to meet aggression in the Balkans than the flexible proposals on this
point advanced by Greece and Turkey.
Deputy Prime Minister Zorlu of Turkey
has stated that Turkey would insist on a Yugoslav commitment to as-
sist Greece and Turkey if they became involved in NATO military
action.
SOVIET UNION
2. Comment on second Soviet note on Tuapse:
The Soviet note of 2 July regarding the
Tuapse incident is more restrained than
Its predecessor of 24 June. It omits the
statement that the USSR will be compelled
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"to take appropriate measures" to safe-
guard its shipping in the area. This
suggests that the Soviet Union is not plan-
ning at this time to convoy its ships, and
��is no indication that any units of the Soviet Pacific fleet
have been alerted for this purpose.
The note also omits the earlier demand
for the "punishment of American officials responsible" but reiterates
that the Tuapse, its crew and its cargo must be returned. It intro-
duces a new factor in declaring that the Soviet Union retains the right
to demand compensation from the United States. It also repeats that
the tanker was seized by American naval forces, adding the phrase
"under whatever flag they may have acted."
As of 3 July, the Tuapse was still at Formosa.
Its crew and its cargo of kerosene had been removed. Although the
Nationalist foreign minister is urging that the vessel be returned,
Chiang Kai-shek is believed to oppose its release at this time.
Three Soviet tankers remain at Singapore,
where they had been ordered followin t e Tuapse incident, and another
Is apparently still at Shanghai.
SOUTHEAST ASIA
3. French defense planning excludes moSt of Laos:
The American army attach�n Saigon
reports that the fate of Laos is the biggest
question mark in current French-Viet Minh
negotiations. Regardless of the disposi-
tion made of Laos, the French reportedly
are p eparmg etailed plans for the defense of the narrow waist of
Indochina within the quadrangle Thakhek Doug Hot Quang Tri -
Savannakhet (see map, po 5). 'The attach�eports that the French ap-
parently feel that a satisfactory line for the defense of Laos cannot
be drawn farther north. He believes that this narrow sector is
Indispensable from a terrain standpoint to the defense of South Viet-
nam.
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The attach�otes also that the transfer
of the Tonkin force into southern Indochina will necessitate exten-
sive clearing a.dtions in areas of major Viet Minh strength, such as
in the plateau regions of eastern Cambodia and embattled southern
Annam.
Comment: The drawing of the primary
French defense line in this area, while sound militarily, would
probably produce the same psychologic I effects in northern Laos
as the decision to abandon the southern part of the delta produced�
In Tonkin.
According to latest reports, the French and
the Viet Minh are negotiating on the basis of a partition of Vietnam;
France is seeking a line in the neighborhood of Dong Hot and the Viet
Minh is apparently holding out for one constderably farther south.
4. Anti-Western feeling among Vietnamese becoming more open:
The American charg�n Saigon reports
increasingly overt hatred toward occiden-
tals in general and the French in particular
as news filters through to Saigon of the
French "military decision" to withdraw from southern Tonkin. A
prominent Vietnamese doctor told the charg�hat the Vietnamese
would, if possible, "turn against the French," and warned that
Americans would also be "looked upon askance." He stated that the
Vietnamese would probably accept a Viet Minh-dominated government
embracing the entire country in preference to a partitioned Vietnam.
Comment: The hostility of the Vietnamese
toward the French will have serious implications as it increases in
the Vietnamese army and among the native troops who comprise more
than a fourth of all French army regulars in Indochina.
The trend toward overt hostility will be
accelerated if Premier-designate Ngo Dinh Diem declares Vietnam
an independent state outside the French Union, as he has threatened
to do if the French pull out of Tonkin.
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NEAR EAST - AFRICA
5. UN observer believes Israelis may attack Old City of Jerusalem:
According to UN observer Hutchison,
General Bennike, chief of the UN Truce
Supervision Organization, had a meeting
with Israeli chief of staff Dayan following
Israel's failure to honor an unconditional cease-fire agreement of
1 July, accepted by both Jordan and Israel. Dayan reportedly told
Bennike: "I do not hold with this 'cease-fire. If and when I give
the word there will really be some firing. I do not care what the UN
or Military Advisory Commission thinks."
Hutchison has stated his belief that
chief of staff Dayan might launch an all-out attack to capture the Old
City of Jerusalem. The American embassy in Amman, however, is
Inclined to disagree.
Comment: General Dayan has a record
for taking independent military action and is close to Ben Gurion, who
is aggressive and still influential in Israeli affairs. In view of King
Hussain's recent advice to Jordanians to return any 'smelt fire sporadic
shooting can be expected even under a truce.
WESTERN EUROPE
Trieste settlement depends on territorial
�id-ustments:
T(TP
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Comment
the Italian government now believes that a rapid solution of the
- r este question is desirable, even though it might not meet all of
Italy's previous demihds.
On the territorial issue, the Italians are
Insisting on minor revisions of the proposed boundary agreement so
that the amount of territory exchanged would be more nearly equal for
both sides.
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