ECONOMIC IMPACT OF A PARTIAL BLOCKADE OF HAIPHONG CHANNEL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78T02095R000800040013-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 15
• Document Creation Date: December 12, 2016
• Document Release Date: January 7, 2002
• Sequence Number: 13
• Publication Date: January 6, 1964
• Content Type: REPORT

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8?E-C?R-E-T
NO ?ORBIGA DISSEM/COCIa`l'IflvED COI[ ROL
CIA IIAL USE ONLY
ECOEMIC IMRACT aF A PARTIAL BLOCKADE OF HAI U0NG. CHANNEL
Conclusions
The impact on the economy of North Vietnam of a partial blockade* at the
Haiphong channel to deep-draft shipping for any period of time 'probably
would be relatively am". North 1J +atnam'a economy is one of subsistence
agriculture with industry concentrated in a few centers, including Hanoi,
Haiphong, Nam Dinh, Viet Tri, and That Nguyen. The country is not as
vulnerable to a blockade as a country which is not able to feed its on
population.
A partial blockade of Haiphong channel would have its greatest impact
on the economy during the first 30 days when confusion from rerouting gds j
reallocating ships and rolling stock, and reassigning personnel Would be at
its height. The maximum effect of the blockade, -however, would be one only
of delay, not of denial, in the delivery of goods. -In considering the.
I mum effect of such a blockade, the time of year at which it occurs is
7
particular irgporce, because ship arrivals have not regularly occurred
evenly throughout the yea* but have experienced peaks and low, point. It a
blockade of two months or more took place at a time when the shipment of
or sports (Including petroletan products, rolled steel, machinery and
equipooent) were high or when reserves of petroleum were low, the impact could
A-par ockade_of Haiphong channel is used throughout this memorandin
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NO FOREIGN DISs /CORTfWED CCINTROL
CIA ThTERNAL um O LY
be more serious than if the blockade occurred at a time when shipments of
major products were low and p!trole= reserves were high.
North Vietnam ; imports all or most of 'its petroleum products, iron and
I
vehicles, spare parts, industrial chemicals., chemi
steel pr ducts, machinery, metal man d'actui?Iea, locomotives, rolling stock
I
and. raw cotton. If 50 percent of these $.mported goods could not be received
at Haiphong because of the partial blockade of the channel, they could be
Ping-Lsiang with Hanoi also would have to be Interrupted.
A partial blockade of Haipi' rg channel i.ould probably not sigatfiaantly
encoua the expansion of other. transport f aCilities within the short period
of a few months, . ? mainly because the rail sys has thy: capacity to carry
most of the cargo that would be diverted frown { phang. In the long run,
hogever, the additional cost and time Or transporting the trade througi, China
effect on the econospr, the ra;
f
transhipped by rail. without ex eseive delay through Communist China to Hanoi.
Therefore, if a partial blocks of Haiphong channel were to have a significant
would probably encourage the expansion of o bez , ports and the r wA and rail.
service to those ports.
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NO FOREI(Rt DISS X/C0NTINUED CMRQL
CIA IRTEBNAL USE OQLT
I. Economic SiA.xiificance of Foreign Trade
^rr^ ^r.r^w?w^ ~^r r^ r.r ~.r?r^~ir rrr ^r.^^~rrr~^^ -
Foreign trade is an important factor in the economic development of
is equal in vale fo
North Vietnam audA 15 percent of Gross National Product.
Economic planing recognises the continuing dependence of the econmW on
imports of capital equipment and machinery as well as a wide variety of
industrial materials. The value of foreign trade in North Vietnam has more
than tripled since 1955, increasing from US $80 milker in 1955 to US $231
million in 1962. Nearly 86 percent oi' North Vietnam's foreign trade is vrith
the Coaenunist bloc. Communist China and the USSR have been its principal
trading partners, accounting. together for about 65 pis :cent of the value or
total trade in 1962.
North Vietnam exports agricultural products, minerals, and handicraft
produbta in exchange for i orts of. manufactured goods. Imports are
particularly important in North Vietnam's industrial development program.
Priority has been given to Smports at complete plant installations, machinery.
and equiipment and industrial ray ante . S,ports of agricuttual pr+oducts,,
coal., tvatitef and comment aooomt f lr the bulls of North Vietnam's fccei.em
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..V T
NO DR
a ~
CIA Ce+rr
{~_~7,,
f 40aborne T7.nA- ... tz O}ite I
Nearly aai
or the $eabarae ell the seaborne e~tt~e ~Pox'ts of North
Vietnam and nearly
except forcoal all or
a
~' s+hi ,
u vn
estimated a ~~' Th. part of
the aa' port is the country avacit" of about 3,600 t=,,* Per day
r with
i
s
Beneral carrgo and lsum b'~ LAY eig3t tac3lities for handllng
Y f
at 8a1phon6 "Ount sd to an estinte 1g the volume of Jmports
Volume d 380 tons led
tons. Of 3nWorts probably. Yacrea.;ed to a and ln 1962 end 1963 Ahe
000 Arta thrtt level bet~reen 4OO
,OpO and 450,0000
Ha3~ph?ag aathamounted to abo
10 19152. It i:~ probable estimated to have a ut
to lncres,~e 19040 Thus at least that the trolwne of
trade will contd
ue
Viat,feee trade per Year, or about 1~1 A111104 to l.2 million tons Of N
et orth
Baipbpng del In dditi 3,000 tons per day,
8ai f on a $Mau amo the
phaag going to or frwq Yunap P ant of Cb3nese peen trade tmoom,ve, thro
ginca North Vietnam has ?~* a row n
tie, all of its $eabo Il tinsels us~ ~
me trade in ~ j13' far ~~
aver of 20 to PS fore flag ve ~~ in foreign n'~aat Vessels- mox* than s$els at An
or $hi halt Cr then am 8i40-goblet aloa $ each nth. ,
ps of AhIp? and '
P
r~ee W
~i
mdarorld- e+~ttMea. ? It is consist
ee World nasal believed that about
are oft-bar
bartered to boa cauntl.Ias
are ginn atria togas use a
rwiee
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NO F
CIA MITErak UM q DIBS$,(C C
in aue froae 3L Y
awn 6ister, average about 5,000 MM each. ~ ') to 10,000 CM but Pr~bab2,v
)lost of the Soviet ana
"ssel8 Which pears S ,ta]Ii tq
make frequent tripe to North Yiet
bet .em 5,000 and ~J000 Qom' each. Some g~ ",:Lot of ships CC
category, al karld 'v+essels are the tie thous may are Under 5,~ 000 tons and in ~'0?
two ft Song ' In
South Coati Kong and various Southeast Asian count
t rest that call at 8alpbt~ Mes. the Chinese
-'000 GIW-
Blockage or the range in sine from 600 aRT
bus have the 8reatest . 8akph channel to deep-dam vessels* w
~ttect on. Sinto-Soviet N] hi Would
Free world s
inrssB340 p and. the larger or the
bulk of north charterer to the Bloc countries. These shy, mwRIk% Yietrwse D$ carry tie
-to the we3! w-saw trade and in Particular the material
1 rtant
ost
available of t"" country. Altho recent
,v sasw Idft of th j amount and typg data are not
various comtries is a 3.able rw. oaC Stoods carried by nhips of the
statistics. PrOOMabl cal data. and f ram Soyi tide
J+ most of the Soviet trade Is carded an
Soviet
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P-E-C-R-E-T
NO FOREIGN DISSEWCCNTINt1ED CONTROL
CIA SAL USE my
.In 1961 Soviet vessels delivered about 200,000 tons of cargo to No
.
Vietnam, and the volume'is estimated to have increased in 1962. In 1962,
S viet exports to North Vietnam included a little more than 90,000 tons of
petroleums products, most of which probably were delivered by tankers. Soviet
ships carried most of the Soviet exports of 39,000 tons of ammonium sulphate
and more than 35,000 tons of metal products to North Vietnam. In addition,
Soviet trade statistics include the export to North Vietnam of
27 bulldozers,
256 trucks, 5 excavators, and various items of agricultural machinery'
Russian ships have been observed in Raphong unloading these and other large.
pieces of equipment, such as cranes and generators, as well. as timber,
equipment spare parts, and bales of cotton.
European Satellite ships delivered an estimated 70,000 tons in 1960 and
about 60,000 tons in 1961. Their cargo consisted mainly of fertilizer,
machinery and equipment, food, petroleum products, and general cargo.
-Chinese ships delivered an estimated 140,000 tons in 1960, but the tonnage
delivered in more recent years has probably declined considerably due to the
economic difficulties in Communist China. The cargo generally included
machinery, spare parts, electrical equipment, food, coal, wood,. medical
sus lies, and, miscellaneous goods. Free World ships delivered about 12,000
toes of miscellaneous cargo from Free World countries in 1960 and 34,000 toga
in 39611. In addition, Free World ships which were time-chartered to Moo
countries carved an unknown quantity of goods to North Vietnam.
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8-8?+C-R-E-T
NO FOEION DI8SI 4/C - CC=OL
CIA SAL WE ONLY
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NO FOREIGN DISSEM/CMtTINU) CONTROL
CIA INTERNAL USE ONLY
Exports 'through Haiphong in 1.962 included as much as 550,000 tams of
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apatite and po'@sibly 200,000 tons of cement.
In addition,
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expo ted. items Included a great variety of agricultural and fuaeatry products.
Although the amount of cargo being handled at Haiphong is near the
estimated capacity of the port, Haiphong harbor is reported by various ship
captains to be inefficiently operrted. in th+ last half of 1963 the port
vas said to be contlnvally congested.
time in August 1963 as many as tore ships were ' ld outside Haiphong harbor
waiting for dock space. Movement ' cargo ac so the docks apparently is
slow, although the North Vietnamese have state that this operation is being
25X1X
mechanized. In 1962 the Soviet Un on agreed ltti help expand port facilities
at Haiphong. Although there is caefirmation that Soviet aid is contributing
to the project, ameber 2 wharf was regor dly being rebuilt in September 1963,
and this eonstr~eti csi also contti to the ort comgestim..
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NO PORMW DISSI /Cants C0NT1 L
CIA naMMAL IE 0NLY
III. E eats of a Blockade! of Saiphong Channel to De -Draft RgXp a
A. Shipping Service
If deep-draft vessels could not enter Haiphong channel, eons
the cargo normally carried on these vessels could be transported by lighters
a n d other small c r a f t to or !from the ships at anchor outside of the port,
The effectiveness of this operation would depend on a my factors', such as,
the distance to each ship, the type of cargo, and the availability of small
craft. Haiphong harbor has ample harbor craft for normal operations,
Including 10 or more 100-ton wooden lighters and 30 or more 200-ton steel
lighters. A complete craft census for North Vietnam l3 not available but the
government owns at least 16 ocean-going barges, 53 river-type barges (8 known
to be self-propelled) i transport tanker opt 300 GM., 5 oceangoing tugs, and
14 river-type tugs, as well as other tugs end various vdacelhnneous craft.
In addition to the gave-mnent-oared fleet, about 500 Junks with capacities
of up to 50 tons each are available in the harbor and can be used for
lighteseg purposes. Furthermore, various Chinese vessels could be moved
the aratively short distance to Haiphong frarm Chinese
ports is Kvaagttmg,
province and eon $athaa Island. These types of craft could, probably bendle all
of the kinds imported pladducte except the
largest pieces of heavy equipment
and the peero1eun In bulk. acee of, the exports could also be handled by.
ligtrtsr,~ but with dcAsidereble boss of effialeacy. Lost at UP ea ports are
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CIA MOZZ" 1 ONLY
bulk commodities, which are difficult to handle by am]] craft, however, and
it is likely that the North Vietnamese would ship most of them by rail to
Chinese ports.
North Vietnam has only two secondary ports that can accomodate
oceangoing vessels, Can Fha and Son Gay, located northeast of Haiphong.
These two ports ; are! especially equipped to export coal but have 'veryilimited
facilities for. handling any other types of cargo. Since neither port has
rail connectiaps' ith the main rail system, g.~ods transported through these
ports would beve td be moved by road or coastal ships. Lack of trucks,
however, would limit the use of road transport. It is unlikely that the
southern port of Ben Thuy, a minor port with a fairway limitation of 21 feet
over tho bar, would be used for even the smaller oceangoing vessels that
normilly call at Haiphong because of the lack of port facilities and a rail
connection with Hanoi.
Initially, blockade of tha Haiphong del would cause great
confusion. Organization of a fleet of small craft for lighter service might
require several . eeks. Thee, North Vietnamese press has often discussed
inefficient loading and unloading operations in all modes of transport and
the difficulties of coordination between the various modes of transport.
Puurthermore,a sudden blockage of the channel would probably confine in the
harbor at least 6 oceangoing vessels that nornmlly are at the dock if the port
is being used to capacity.
- g.
S-E?C-R?S-T
NO FOREIGN DISWOOMNM COI'RCL..
CXA IAL USX CSLY
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CIA SAL OPLY
B. Interior TzvmWrt Connections
.. Railroads
I I
If the block i ade of tha port of Haiphong were 50 percent
effective, it would necessitate shifting about 1,500 to 1,600 tons,.-of cargo
per day to some other port or ports. The most economical reallocation would
be to shift the entire cargo to South China ports, in particular, Fort
Bayard. The goods could then be transported by railroad to Hanoi, a total
distance of about 850 kilometers from Fort Bayard. The railroad between
these two cities consists of a siasgle track standard-gauge line from Fort
Bayard to Ping-hsia>g, China, and. a single-track meter-gauge line from
P'ing.hstang to W noi. The meter gauge line, which has the lower capacity
or the two sectors, has an estimated capacity of 2s500 to 2,700 tons each
way per day (EWPD). The line is reported to be veil constructed and maintained.
Actual, freight traffic over it at present probably averages less than 1000
tons $4JPD, leaving an uLiused capacity of more than 1,500 tons IWPD. Although
the estimates of opacity and of the actual traffic carried on the Ping-heiang-
Hanoi line are subject to large margins of error, it is estimated that ample
excess capacity exists on the line to carry the tonnage, which would be'diverted
by a partial blockade of Haiphong.
Possible congestion at Ping-hsisag, the traueloading point on
the border bsbaeesa the standard,-gauge rail system cf China and the auter.u uga
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NO FQREII' ISSk /CO1 TINUED CONTRA,
t1SE =a
system of North Vietnam, might initially limit the actual tonnap transported
to a figure somewhat~below the'theoretioel capacity of the line, although
no significant delays or limitations on traffic are known to have occurred
in the past from the tranoloading operation. If continued congestion
occurred at the tranaloading point, it could be eliminated by the expansion
of the transloading facilities, a task that could be accomplished rather
easily and probably within one month.
The narrow-gauge rolling stock park probably would not be a
limiting factor in the attainment at th,: theoretical capacity of the P ing-
hsiang-Hanoi line. Although freight care and locomotives are not plentiful
in North Vietnam,, Chinese narrow-gauge rolling stock from the Kunming Railroad
Bureau gould be used to st plement a deficiency in the North Vietn ere
rolling stock park. Furthsrmoze, rolling stock previously used to move
seaborne traffic between Hanoi, and Naiphong could also be used. Repair
facilities ara believed to be adequate to service the - Increase In the 'active
park. A shortage of narrov-gauge tank cars for carrying petroleum probably.
would be the only difficulty encountered by the North Vietnamese as far as
rolling stock is concerned. Some petroluem products could be moved in drape
by rail., but would require considerably more time than movement, by tank cars.
The inability to divert all petroleum shipmeate to the rail system could be
the most serious problm for North Vietnam in case Haiphceg chansel is blocked.
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NO FOREIt D /C05TXMUE0 CONTROL
CIA 11 ERNAL USE ONLY
It is estimated that the actual time on the railroad to
transport goods between Hanoi and Haiphong is about 5 hours. The time
required for freight to move bet.?ee i Hanoi and Fort Bayard is estimated
to average about 2.1/2 days, thol uding one day for transloading at P' i ng.
hsiang. For those goods originating in Haiphong, such as cement, at
least five hours must be added to the 2 1/2 days. During the first few
weeks, confusion in rerouting goods, reallocating and possibly, obtaining
more rolling stock, and reassigning personnel, would probably cause some
tie ' ups and, in general, lengthen the average rail time. In the long run,
however, diversion of goods to rail transport through Ccmmiat China would
not cause undue delay nor create se11ous problems for either the North
Vietnamese rail or the Chinese: rail system.
2. Road and Air T
Two road systems connect Fort U7'rd and Hanoi. One of these
generally parahels the railroad be" the two cities and the other follows
the coast] sue. If necessary these reads cooled I used to supplement' the
I f
transportation by rail of the goods shifted to 8 th China ports. Although
sufficient road capacity exists to transport con#iderablee `.quantities, road
transport would irobably be used
CC trucks, vehi cl spare parts, and
i orted,, the fo2th Vietnamese
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NO FOREIGN DXSSNM/C~ CO
CIA Il ALIM (ZLY
blockade unless absolutely neceeaaxV. Sms-LI amounts od' h priority
items could be floim trim Chines. aixl'ielda.to North Vietnam.. Shortagss
of spare parts and to el for aircraft in bath North Vietnam and. China,
however, r ad limit ,the us* of air tra"po t w4e4s an airlift V we
rgaA .xed r d a por d br 4the 8R?
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MO FOREIGN DISSS s/C w) COMM
CIA nrimu,L t 8 0n!
IV. Effects of a Blockade on ension of EMMort, Facilities
A partial blockade of Haiphong port would probably not significantly
encourage the expansion of other transport faciltties within the short period
of stew months, mainly because the rail 'system has the capacity to carry most
of the cargo that would be diverted from Haiphong. In the long run,
however, the additional cost and time of transporting the trade through
Chinn would probably encoiisego the expan.3ion of other ports and road and
rail service to those ports For exaile, some expansion in the port of
Ben Thuy has been underway and the main rail line south to Ben Thuy is
being rehabilitated. This work might be speeded up but, on the other d,
blockage of Haiphong', might result in more difficulty in getting materials - -
t~ do the work.
Construction work bas been underway for several years to convart the
gpuge of the rail. Bite between Hanoi. end P' ing-hsiang from meter gauge to
standard gaugei,the some as the Chinese system. It Is conceivable that it
the port of faiphong vre to be obstructed for a considerable period.of time
that worts on this project would be stepped up. Co nknaist China has sufficient
materials and, cs pacity to do this work if neces a y-.
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10 FORA DISSOd/C_.
CIA~UBE.OY
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Of Production i-Yed that the MM bAs
tba
It ire be-1i 1
s
i ele is For xnereasee in
SOVI"~C~Ude bt. DiI tips, Maw. Pie.
Ot Me 48 they
million tMa crude oil ecictuled tow tha t to reao8 those
t tetoA in l jp but si6uttieant Vim Coming Years ~(e.g., 390le0n base tbrot V144 12 d not lik'J,Y. Teton oft crude oil 0+ d
t,tiL ?t
ruati Sh the drilling 1Oi'8
the +~onet
ca at crude an tory and d Produa~
the +eartu~;n itJr in the sew e8 ilitite does lot
'he U bod in tie'
g ' of driliing to
a.Yjr the water fl 3 : bas beft Una than ~ In past ~-eat's
SISUflanwe as ? mama Lori whI*h is assuming B>ro~ri
not difteted , e O r d t h e a the arwUsed y crude oil o u t
t
i in fast? problem 3t~ of Pro Quatlo ca 'P is
crude ail metered.. 3'hus It to n Of the w-ter tl PQC
i `
he. had to bed Pult rs ' "O '1 that all t-bo Pro-
Y suitiAS drIWD
Now
Unit"
'~ ?wt zed to Ie ~ ... 8 and water flooding
b ; Va inow LZ be 1 inwas ,,,,i VIt2 the