CURRENT INTELLIGENCE BULLETIN - 1955/08/07

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03448330
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 7
• Document Creation Date: September 20, 2019
• Document Release Date: September 26, 2019
• Publication Date: August 7, 1955

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7 August 1955
�Copy No.
CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO. 40
NO CHANGE IN CLASS.
I DECLASSIFIED
CLASS. CHANGED TO: TS S C
NEXT REVIEW DATE: 20/0
AUTH: HR 70-2
DATE: 1.1.04.45(0_ . REVIEWER
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
CRET
99
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SUMMARY
GENERAL
1. British Foreign Office reaction to Bulganin's 4 August speech
(page 3).
2. France seeks lower level of trade controls on Communist China
(page 3).
'AR EAST
3. Hatoyama government seen weakened (page 4).
4. Additional details of Sun Li-jen case reported (page 4).
NEAR EAST - AFRICA
5. Cyprus government expects new outbreak of violence (page 5).
* * * *
6. Comment on South Korea's ultimatum to truce inspectors to
withdraw (page 6).
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GENERAL
1. British Foreign Office reaction to Bulganin's 4 August speech:
he British Foreign Office's "preliminary"
eaction to Marshal Bulganin's speech on
August before the Supreme Soviet is that
it was an "ungenerous" restatement of old
viet positions, according to the American embassy in London.
The Foreign Office had expected a Soviet rejection of President
Eisenhower's plan for aerial inspection.
Bulganin's assertion that the Eden security
pact proposals deserve attention is not believed to reflect any prog-
ress, in view of his disappointing statements on German unity.
2. France seeks lower level of trade controls on Communist China:
The French Foreign Ministry's director
of economic affairs told American offi-
cials in Paris on 4 August that his govern-
ment desires the trade controls on Commu-
nist China lowered to the level governing trade with the Soviet bloc.
He pointed out that France regards the present disparity as ineffec-
tive in controlling trade with Communist China.
The French official said he is recommend-
ing that the Consultative Group of COCOM meet on 27 September.
Comment: The United States is committed
to discuss controls on China trade at the next meeting of the Consul-
tative Group, the ministerial level of COCOM. The last meeting
was held in September 1954. Except for the United States, most
countries on the China Committee of COCOM appear unanimous in
their desire to reduce present controls on trade with Communist
China to the level for the Soviet bloc. (Concurred in by ORR)
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FAR EAST
liatoyama government seen weakened:
Ambassador Allison reports that the
prestige of the Hatoyama government
has suffered a serious blow because of
its ineptness in the Diet session ending
wiucn o pass major legislation and irritated the
conservative opposition. He believes the government will have a
hard time weathering another Diet session.
Allison believes Hatoyama will probably
attempt to recoup his government's prestige during the current re-
cess by achieving some diplomatic or other succesE
Such
an agreement could be presented as a victory for Hatoyama's poliey.
The ambassador also believes Foreign Minister Shigemitsu's visit
to Washington will be used to bolster the government's prestige.
Comment: Hatoyarna infuriated the Liberal
Party, whose support is the key to his minority government's sur-
vival, by announcing on 4 August that he intended to compile the
budget "by himself," and rejecting Liberal overtures for a merger.
Liberal Party secretary general Ishii is threatening a showdown in
the next Diet session, probably in November, if Hatoyama fails to
take the opportunity for a merger now.
4. Additional details of Sun Li-j en case reported:
The Chinese Nationalist Ministry of Na-
tional Defense has made available to
American officials a report alleging that
General Sun Li-jen had endorsed and gave
IinanciaL support o a Communist-instigated plot to induce defec-
tions in the Nationalist armed forces. General Sun was forced to
resign last week as Chiang Kai-shek's personal chief of staff and
has apparently been arrested. The charg�dds that a former aide
and close friend of Sun's has also apparently been arrested.
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The American charg�omments that if
the report is true, which he doubts, it will "sow consternation"
on Formosa, since if Sun is found seditious, there is a question
whether anyone can be trusted. Even if the report is false, the
damage to Nationalist China's reputation will be considerable.
NEAR EAST - AFRICA
5. Cyprus government expects new outbreak of violence:
British authorities on Cyprus told the
American consul in Nicosia on 5 August
they were "virtually certain" that new
outbreaks of organized violence are
tion with the British-Turkish-Greek talks on
the Cyprus issue scheduled to begin in London on 29 August.
The government has more information
on the organization of the terrorist EOKA group and intends to
take further action against its members before the London con-
ference.
Comment: Despite efforts by the author-
ities to control the situation, violence in connection with the talks
can be expected. Although deliberate attacks on American lives
and property are unlikely at this stage, there is growing antagonism
toward Americans.
Cypriot nationalists have been extremely
critical of the proposed meeting because of Britain's failure to in-
vite their representatives. Nationalist leader Archbishop Makarios
has already announced that the Cypriots will not accept any agree-
ment which does not satisfy their aspirations. The Greek govern-
ment has submitted the Cyprus issue for consideration by the UN
General Assembly.
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* * * *
6. Comment on South Korea's ultimatum to truce inspectors to
withdraw:
The South Korean government's ultima-
tum on 6 August to the Neutral Nations
Supervisory Commission to withdraw
its truce inspection personnel by 14
August is: (1) a reflection of'Rhee's impatience over failure to
dissolve the commission; (2) a result of his fear of a rapproche-
ment between the United States and Communist China; and (3)
another effort by him to force more favorable terms of Ameri-
can aid, now under negotiation in Washington.
The ultimatum declared that South Korea
could not assume responsibility for any incident that might in-
volve commission members who fail to depart. The reported
bayoneting by American guards of three Korean wounded war
veterans who attempted to break into a commission compound
during a demonstration in Pusan on 7 August suggests that Rhee
may be testing American determination to protect the truce teams.
"Demonstrations" by Korean wounded veterans are government-
directed and controlled by the police.
The commission is not expected to order
the withdrawal of its teams in response to the ultimatum and fur-
ther violence may occur this week as the deadline approaches,
Isolated actions�such as sniping, for which complete security
cannot be provided--are also possible. Rhee will, probably seek
still other means of embarrassing the United States in his continu-
ing effort to influence American foreign policy in the Far East.
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