SERVICES DIVISION COMMITTEE ON CHINA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP61S00527A000200160017-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 4
• Document Creation Date: November 9, 2016
• Document Release Date: July 9, 1998
• Sequence Number: 17
• Publication Date: May 21, 1958
• Content Type: MIN

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Services Division
Co mnittee on Chi=
Conconittse Minutes - 171st Meeting - 20 Mary 1958
25X1A9a
D/S Papresentatives
Guests:, 5X1A9a
25X9A8
25X1 X7 l? As a follow-up of a discussion some weeks ago corning possible
geese h topics for 1959
resent
t
li
t
, p
&
a
s
of auggsstioats ITUM
25X1 X7 The topics are those feels have not been studied, 25X1 X7
25X1X7 sufficiently and that doea not have the resources to handle.
While the MA FY 1959 research grogram, is now established, aomoe aspects
of the suggestions might be incorporated into projects already scheduled
or they will provide ides. for f utuu a research programs.
2. On 3 May Radio Peking stated that average daily output of coal had
increased, to half a million tons in April and, that at this rate China's coal
output for 1959 could be expected to reach that of Britain, vh1ch is about
230 million tons. This follows an earlier sward revisions of the 1958
taript to 18C mil Lion tons.
25X1X7
1957 production was only 128 million tons. The
high Apr re a announced so soon afUr the end of the month nit be treated
with considerable reserve. The Oluese clearly intend a very large increase
in coal production this year through rapid develo, me t of small workings,
but it is reded as emulation or propaganda figures rather than realistic
planning estimates.
25X1X7
3- Radio Peking announced on 11 May that the Chinese Cemmmiet Government
had stopped the siuiag of permits for trade with Japan. It was further
reported, that the bead of the Chinese Canurnusiat steel mission in Tokyo bad
announced suspension of his mission's barter talks with Japanese steel mills
and trade circles.
25X1 X7 : T base moves follow the refusal to isplement the
25X 1X7 fourth va 'e a ement and represent an intensification of the pressure
anticipated in sv{pp1emei t item 3. The announcements are clearly
timed to affect the forthcoming Japanese elections, althot shipments for
which permits have already been issued will probably be peermitted.. to proceed.
The ima .fate prospects for Sino-Japanese trade appear most unfavorable.
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4. China now appears to have a fairly hig ccmWetence in electronics.
The constructicm. of two Soviet-type electronic comg~s beginning in 1958
has been anno raced. One model is re 3.atively small "tion is to
begin almost immediately. A more comrplex model, very modern by world
standards althouak it has been in production since 1952, is to be constructed
later.
25X1X7
5. The Chinese Communists have indicated plans to construct small rural
hydroelectric power plants in 1958 with a total capacity of 900,000 kw. This
coe parees to a total of 20,000 kw in that type of plant at the and of 1957. It
is estimated that about 50,000 plants will be required to provide 940,000 kw.
It is certain that a large number of small plants will be constructed in 1958
but not nearly enough to fulfill this plan.
25X1A9a - 14IFF.
6. A Japanese ne per reports a uranium mine being developed at Gartok.
The newspaper also says that the highway to Gartok is being built to transport
this material. Information confi t ni g or dew this reps was solicited.
25X9A8
7. Tie Chimese Communists are reporting more petroleum discoveries in
Szechwan. The Mao-ming shale works are being developed more rapidly than
expected. Since the appointment of a new Minister of petroleum more modest
goals have been announced. It is not clear yet whether this represents a
more conservative attitude of the new minister or whether the Chimso are
taking a more realistic attitude toward petroleum production.
25X1A9a OP.
8. A new development in Chinese agriculture is the possibility that the
cooperatives are to again take over the using of livestock. tghen the coopers-.
tines atten ted this before, the decline in livestock production was so great
that it was put back in private bands.
Despite all the talk about fertilizers, the major emphasis is still
being placed on irrigation as a means of increasing yields.
25X1A9a M/AG,.
9. Statistics for ton-kilometer performance in North Vietnam confirm
earlier suspicions that transportation traffic plans had not been net. The
announced 1956 plan was an ambitious one. On 1957 figures show that both
railroad and water traxsportation:performance was lower than the 1956 plan.
Transportation performance goals for 1958 indicate on y modest increases over
1957 performance and no significant change in the proportion of total traffic
load to be carried by each form of transportation.
The opening of the now rail connection with. Kxmming in China on 1
March may permit overfulti1]ment of the railroad plan in 1958.
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There is an unconfirmed report that the gauge of the railroad stem
in North Vietnam is to be widened,, possibly to the standard puss (k'")
of the Chinese railroads, beginning in 1958. If trw, this could result
in a rapid increase in railroad performance in North Vietnam.
25X1A9a s/TR.
10. Preliminary statistics release in February 1958 indicated that
railroad performance in Communist China during January 1958 was not up to
ex;ectations. Total freight tonnage originated during January represented
an increase of only 6.3 percent above Jaary 1957. In the Shanghai sector,
car loadings in January and February were reported to be below expectations
on account of a shortage of freight. This was interpreted as foreshadowing
an unusually heavy traffic load later in the year., particularly during the
third, and fourth quarters, when anticipated incrreaaea in production activities
are emoted to add further to the burden on transportation facilities. There
was some apprebension of the possibility of a recurrence of the serious traffic
congestion which deav+eloped in the latter part of 1956.
Figures released by the State Statistical Bureau early in April for
the first quarter of 1958 indicated that railroad, tons originated ran about
13 percent above the first quarter of 1957. This eras an Improvement over
the situation of January and February but it still meant that about 80 percent
of the annual plan woulsi have to be accomplished during the last three quarters
of the year. Figures for April wars much more encouraging with teens originated
showing an increase of 32 percent above April 1957- Industrial freight increased
by 4+1 percent, a figure almost approximating than increase in total industrial
output of 42 percent. Amnon p3.aa3 for the entire year of 1958 call for an
increase of from 13 to 20 percent in tons originated. It seems quite likely
that the 13 ipercent figure will be ' exceeded and that the final figure will
be above the average annue.3. increase of 15.4 percent which took place during
1952-57-
The Chinese Communists apparently are quite concerned about the
transportation system and the possibility that it may act as a brake can the
economy in 1958. For enpmVI,, during the early part of April the National.
Economic Commission called a conference to consider the transportation load
during the "leap forward" year of 1958. At the conference it was pointed
out that there might be a pipe-up of shipments during the second half of
the year and that tranaportatic might become a limiting factor to the "leap
forward" of the national ecoanem y. The Comissio a indicated that male of the
big Problems of 1958 resulting from the increases in production and. coacstruc-
tion was to devise methods of organiztg a balanced transportation system
and of making arran ate for shilging as much tonnage as possible during
the second, and third, quarters of the year.
25X1A9a sue.
-3-
sR-C R-E-T
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E"-.CS1-C-R-194T
ABOnda: A* next ne Ing Will be Je 3. ToPic: CmVent Itenw
Room 1221 M at 11140.
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OR/S/TR i.kc/2370 (21May58)
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