CURRENT INTELLIGENCE WEEKLY SUMMARY

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CIA-RDP79-00927A000500050001-3
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S
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January 6, 2005
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1
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May 5, 1955
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SUMMARY
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Approved ForRelease 2005/01/27 : CIA-RDP79-0092`7AA000500050001-3 CONFIDENTIAL CURRENT INTELLIGENCE WEEKLY SUMMARY COPY NO. 14 OCR NO. 3984/55 5 May 1955 N?. ?,o C- I SI r pgClAS -~ T0 GLP,ss: ,e nrnPL E:1A AuT'n W REV1EVJE' CENTRAL INTELLIGENCE AGENCY I I I OFFICE OF CURRENT INTELLIGENCE DIA and DOS review(s) completed. CONFIDENTIAL r~Q nr71r- & IVES RECORDS CE U1 ria JOS Approved For Release 2005/01/27: CIA-RDP7900927A040J3 25X1 25X1 Approved For Rase 2005/01/27 CIA-RDP79-00927AA500050001-3 THIS MATERIAL CONTAINS INFORMATION AFFECT- ING THE NATIONAL DEFENSE OF THE UNITED STATES WITHIN THE MEANING OF THE ESPIONAGE LAWS, TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS- SION OR REVELATION OF WHICH IN ANY MANNER TO AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW. The Current Intelligence Weekly Summary has been prepared primarily for the internal use of the Central Intelligence Agency. It does not represent a complete coverage of all current situations. Comments and conclusions represent the immediate appraisal of the Office of Current Intelligence. Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 Approved Fc elease 20 9 I DENS1ALo927A000500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 T H E W E E K. I N B R I E F PART .1 OF IMMEDIATE INTEREST VIETNAM . . . . . . . . . . . . . . . . . . . . . . . Page 1 Having driven most of the Binh Xuyen forces out of Saigon, Premier Diem is faced with the delicate politi- cal task of retaining the co-operation of his extremist followers onthe one hand, and the French and perhaps Bao Dai on the other. Diem is reluctant to break definitive- ly with the ancien regime in view of the importance to his government of he military support which the French can offer and because the ouster of Bao Dai might call into question the legality of his government. AUSTRIAN TREATY CONFERENCE . . . . . . . . . . . . . . . . Page 2 The concessions made by Soviet ambassador Ilichev at the third session of the ambassadors' conference in Vienna demonstrate that Moscow intends to get an Aus- trian treaty signed quickly, with no quibbling over de- tailed terms. USSR PLANS NEW MOVES IN EUROPE . . . . - . . . . . . . . . . . . . . . . Page The USSR is planning to take steps to give East Germany more of the attributes of,sovereignty and pre- pare the way for Soviet diplomatic relations with Bonn. The Soviet bloc security conference meeting in Warsaw on 11 May will. probably sign a mutual aid treaty and an- nounce establishment of a unified command as a counter- AFGHAN-PAKISTANI TENSION MOUNTS . . . . . . . . . . . . . . . . . . . . . Page 4 The Kabul radio broadcast of 4 May proclaiming a state of emergency and ordering the mobilization of the armed forces is probably primarily a political move to indicate firm resistance to Pakistani diplomatic measures designed to force Af han surrender on the Pushtoonistan issue. CONFIDENTIAL eft Approved For Release 2005/01727 : CIA-RDP79-00927A000500050001-3 THE WEEK IN BRIEF 25X1 Approved Welease 2005/0?kffDP79-00W000500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 FORMOSA STRAITS . . . . . . . . . . . . . . . . . . . . . Page 5 There was no significant military activity in the Formosa Straits area this week. The Chinese Communists continue to improve their capabilities in the area. SYRIA . . . . . . . . . . . . . . . . . . . . . . . . . . Page 6 The Syrian political situation, which has been rela- tively quiet while the controversial proposal for a Syrian-Saudi Arabian-Egyptian pact has been under consid- eration, is again threatening to erupt. Harassment of West Berlin Continues: The East German government appears to have a opted a policy of in- termittent pinpricks- against West Berlin designed to make it difficult for the West to take effective countermeasures and to force the West Germans into negotiations with the East German regime at as high a political level as possible. The restrictive de- vices employed to date are few and relatively minor in comparison with measures the East German govern- ment could take to make life in West Berlin diffi- cult. I . . . . . . . . . . . . . . . Page 1 Japan's Relations With the Sino-Soviet Bloc: Japan's opening position in the talks es a USSR, sched- uled to begin in London on 1 June, is taking shape. Prime Minister Hatoyama, in a reversal of his pre- vious statements, declared before the Diet last week that the settlement of such questions as fron- tier revisions, fishing areas, and the Japanese still held in Siberia was a condition for restoration of diplomatic relations with Moscow. . . Page 2 Status of Top Soviet Leaders: The arrangement of por- traits o the Soviet leaders on May Day demonstrated graphically that Party Secretary Khrushchev enjoys precedence but not unqualified pre-eminence. . . . . . . . . . . . . . . . . . . Page 3 SECRET iRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 THE WEEK IN BRIEF 25X1 25X1 Approved For Release 2005/0~/,2 efi J DP79-009 70000500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 May Day Military Parade in Moscow: The Soviet army showed new or modified ar lery, including a 200mm gun-howitzer, at Moscow's May Day parade. Bad weather forced cancellation of the air show, but several new planes appeared in pre-May Day practice flights and 11 new jet heavy bombers were seen in the air at one time. Page 3 Cambodia: Under the leadership of Prince Sihanouk, Cambodia is attempting to put a more neutralist face on its foreign policy. The former king's desire to forestall accusations of close identi- fication with Western interests makes him sus- ceptible to efforts by India to bring Cambodia into its sphere of influence. . . . Page 5 USSR Encourages Neutrality in the Near East: The USSR s energe ca y continuing s campaign, launched in March, to dissuade Near Eastern countries from adhering to the Turkish-Iraqi pact. The campaign combines threats, suggestions that neutrality would have many advantages, and frank efforts to associate the USSR with the Arab cause.. . . . . . . . . . . . . . . Page 5 Tito Stalls on Closer Military Ties With West: Yugo- slav leaders are resisting Western requests for closer military ties. Although Tito has said that he would give up Western aid rather than start mil- itary planning talks now, he still wants American military assistance. . . . . . Page 6 Italian Presidential Election: Giovanni Gronchi's elec- tion as president of Italy was a severe blow to the prestige of Premier Scelba and his center coalition government. The election emphasized the splits with- in and between the present coalition parties, and may presage the formation of a government somewhat to the left of Scelba's. F_ I . . . . . . . . . Page 7 SECRET Approved For Release 2005/01/2T lA-RDP79-00927A000500050001-3 THE WEEK IN BRIEF 25X1 25X1 25X1 25X1 Approved Felease 2005/01/27 : CIA-RDP79-0097000500050001-3 SECRET 5 May 1955 Iceland Strike Settled: The settlement on 28 April of the 42-day s r e of over 7,000 Icelandic workers is a political victory for the Communist and left Socialist elements which dominated the strike. The wage increases granted will probably start a new in- flationary spiral and could lead to a devaluation of Iceland's currency. I. . . Page 8 Guatemalan Regime Faces Serious Economic and Political Pro ems: Guatemala's continuing economic cu es and internal political rivalries are undermining the popularity and strength of President Castillo Armas. Unless the government's financial and polit- ical difficulties are eased in the near future, Castillo's position will deteriorate, and coups may be attempted. . . . . . . . . . . Page 9 25X1 PATTERNS AND PERSPECTIVES. THE EFFECTS OF THE AUSTRIAN DEVELOPMENTS ON GERMANY Page 1 Chancellor Adenauer's pro-Western policies will face a severe test during coming months as a result of the Soviet initiative on an Austrian settlement. There has been no significant growth of neutrality sentiment in West Germany. However, plans for a German settlement modifying Germany's position within the Western defense alliance are being advanced in West Germany and else- where in Western Europe. CHINESE COMMUNIST TACTICS IN SOUTHEAST ASIA . . . . . Chou En-lai's public commitment at Bandung to peaceful aims and methods strengthens the probability that Peiping will continue to emphasize the concilia- tory aspects of its policies toward Southeast Asia. Page 3 25X1 25X1 25X1 25X6 25X1 SECRET Approved For Release 2005/01/27:CIA-RDP79-00927A000500050001-3 THE' WEEK IN BRIEF Approved Fo1 elease 2005/01/27 : CIA-RDP79-009277A 00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 OF IMMEDIATE INTEREST Having driven most of the Binh Xuyen forces out of Sai- gon, Premier Diem is faced with the delicate political task of retaining the co-operation of his extremist followers on the one hand, and the French and perhaps Bao Dai on the other. The army, through its radio, reserved its position on both Bao Dai and Diem by deferring to the will of the people as expressed through a national assembly or referen- dum. Diem is reluctant to break definitively with the ancien regime in view of the importance of the military sup- port which the French can offer and because the ouster of Bao Dai might call into question the legality of his government. He is attempting to meet this problem by convoking an "Estates General" of some 1,000 representatives from all parts of the country` He apparently feels that the de- cisions of this body will es- tablish the legality of his subsequent actions. The results of the first meeting of the congress on 4 May indicated that a majority of the delegates favored the immediate deposition of Bao Dai, while a minority pressed for the organization of a pro- visional assembly and cabinet as the first order of business. The government indicated its moderate approach by pro- posing a three-point resolution calling for Bao Dai's dele- gation of powers to a national assembly, the organizati.(h elections within four months, and a pledge by Bao Dai to refrain from appointing a new premier during this period. French officials in Saigon and Paris contend that Diem is becoming a captive of the "People's Revolutionary Com- mittee" which sprang up during the past week, and that he may become a "Kerensky," with the committee playing the role of Bolsheviks. Allegations that the committee is subject to Viet Minh influence, however, remain unsubstantiated. The best known figures of the committee are the Cao Dai loyalist general Nguyen Thanh Phuong and Hoa Hao general Nguyen Glac Ngo. These generals, and General Trinh Minh The--since killed in action--have been actively anti-Communist over a period of many years. The American embassy in Saigon believes these men lack the intelligence to con- duct the sort of political cam- paign which the revolutionary committee has been putting on and suspects that someone else is providing the brains. The committee's brain- trust appears to consist of pons who have been closely associated with loyal elements of the Cao Dai and Hoa Hao sects. Of the nine members of the committee, two are reported SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART I OF IMMEDIATE INTEREST Page 1 of 7 Approved Fof.5elease 2005/01/27 : CIA-RDP79-009 00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 to have served with the Viet Minh sometime prior to 1952. Evidence is lacking that any of them has had connections with the Viet Minh since that time. The committee is hammering away at popular anti-Bao Dai and anti-French themes. Ex- tremism is its stock in trade, and it is thus clearly a threat to the evolution of a stable, nationalist government. Whether Diem will be able to control the committee is not yet clear. He should be able to control it so long as he controls the national army. The American embassy in Saigon deems it possible that the Viet Minh may be active at the third or fourth echelon of the committee. The obscurity of the committee's origins and the haste with which it was organized make it relatively vulnerable to Viet Minh in- filtration. However, a Viet Minh broadcast of 1 May described the committee as a "farce." AUSTRIAN TREATY CONFERENCE The concessions made by Soviet ambassador Ilichev at the third session of the am- bassadors' conference in Vienna demonstrate that Moscow intends to get an Austrian treaty signed quickly, with no quibbling over detailed terms. Although some provisions, notably the four-power guarantee for Austria, will probably have to be worked out by the foreign ministers, it now appears that the ambassadors can settle most of the details. A major shift in Soviet tactics was reflected in Ilichev's agreement on 4 May to delete Article 17, which sets the maximum size of Austrian armed forces, as well as two other articles restrict- ing military training and stocks of war materiel. On the previous day, Ilichev had said he was not authorized even to discuss Article 17, and on 1 May Pravda had sharply attacked etstern proposals for in- creasing the maximum limits on the army as an attempt to draw Austria into the Western mili- tary bloc. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART I OF IMMEDIATE INTEREST Page 2"of 7 25X1 25X6 25X6 25X1 Approved Fo elease 2005/01/27 : CIA-RDP79-0092W00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 Although Austria is not likely to create a large enough army to cause Moscow any serious concern, the USSR certainly has no interest in increasing Austrian forces, and this sudden reversal can only have been intended to dram- atize. Moscow's willingness to make concessions. Ilichev also agreed at the third session to delete Article 16, which provides for the re- patriation of refugees and dis- placed persons and bans refu- gee organizations hostile to any of the powers. The USSR, which had previously insisted on including this article, agreed to drop it altogether, despite the fact that Western representatives had offered a compromise version,. The Soviet ambassador con- tinued at this session to oppose incorporating the Soviet economic concessions granted to Austria during the Moscow talks in Article 35, which, covers this subject. USSR PLANS NEW MOVES IN EUROPE The USSR is planning sev- eral modifications in its European policy in response to the final ratification of the Paris accords and the ending of the occupation of West Germany. A Soviet bloc security conference, with China attend- ing as an observer, will meet in Warsaw on 11 May. The eight countries participating are ex- pected to sign the treaty of friendship and mutual aid and establish the unified command first threatened at the Moscow conference last December and negotiated during February and March. Moscow apparently now in- tends to take formal action establishing a counterpart to NATO and facilitating the re- tention of troops in the Satellites following an Austrian treaty. In order to match the abolition of the West German occupation, the USSR may an- nounce new measures of "sov- ereignty" for East Germany, the most likely step being the abolition of the Soviet High Commission. The demise of this already moribund in- stitution would not necessarily affect Soviet control of East Germany or relations with Allied officials in Germany. A formal announcement of the creation of an East German army appears likely either as a prelude to or in conjunction with the Warsaw conference. A possible date for the announcement of any such measures in East Germany would be 8 May, the tenth anniversary of V-E day. It is reliably reported that the Communists are planning a major propaganda barrage then, with a large' rally and parade in East Berlin and speeches by East German leaders emphasizing the need for greater production and defense efforts in East Germany to meet the challenge of the Paris accords. SECRET Approved For Release 2005/01 27 : CIA-RDP79-00927A000500050001-3 PART I OF IMMEDIATE INTEREST Page 3 of 7 25X1 Approved F o r Release 2005/01/27 : CIA-RDP79-009000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 With the successful Aus- trian mission to Moscow in the background, the USSR may soon repeat'its 15 January offer to the West. German government to establish diplomatic relations. Preliminary pressures on West Berlin (see Part II,ip. 1) are part of the'general Soviet drive'to force West Germany to come to terms with Moscow and the East German regime. The USSR probably will encourage visits to Moscow by nongovernmental Bundestag groups and hold out the pros- pect of returning German prisoners of war. The USSR admits holding only a few thousand POW's. West German estimates run as high as 17,000 in addition to civilian internees. AFGHAN-PAKISTANI TENSION MOUNTS The Kabul radio broadcast of 4 May proclaiming a state of emergency is presumably the Afghan reaction to Pakistan's closing on 1 May of its consu- lates-in Afghanistan and its Samarkan ~~ r S. S. CHINA R. f. I . ^ staknawa Termez 3 Aq cbeb ?? ( r ~+~ ? / +SM1'berBM1in M u ish i NM13nab20 ~ ' ~ a r .,, _ j~? Mai mane PuIa.KM1Umri N ICT KuSM1 ka MMW 1 ' Qaia rv.u lj ~ KABUL JAL 'LA AD .11 AF GHANISTAN TM1a J NM1w / ~ a _ , s -~ : pin eaibak. C H A A -i - QaeNa 1A P A K I S T A N ~P -- BIKAN ER 28 _ AFGHANISTAN PAKISTAN IRAN 28 APRIL 1955 m, 5 aTurbat 4. -,. {{ KARACH HvorRA 9AD All-weather road . 1--r~ Railroad (selected) A R A B J A 9 N S EA . as ao a request for the clos- ing of Afghan consu- lates and trade mis- sions in Pakistan. The broadcast an- nounced the mobiliza- tion of the armed forces and the calling up of certain reserve classes. Kabul also has recalled its charge in Karachi. These Afghan moves are probably designed partly to indicate firmness in the face of Pakistani diplomatic measures aimed at forcing Afghan surrender on the Push- toonistan issue. The moves were probably also in- tended to discourage any attempt by Afghan tribal groups to march on Kabul and loot the city as is customary in time of unrest. A few tribesmen had to be turned back north of Kabul following the looting of the Pakistani embassy there on 30 March. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART I OF IMMEDIATE INTEREST Page 4 of 7 25X1 25X1 Approved Folease 2005/01/27 : CIA-RDP79-0092- 00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 There is no indication that. mobilization of the 62,000 ineffective Afghan forces was ordered in preparation for an armed attack on Pakistan or because of fear of invasion from Pakistan. Pakistani government of- ficials have informed. the Ameri- can embassy that they are pre- pared to break off diplomatic relations and to close the Afghan border if Kabul does not respond by 15 May to their de- mands for restitution for the recent looting of the Pakistani embassy there. Closing of the border would cut Afghanistan off from its normal routes to the sea and virtually end its trade with the West. There was no significant military activity in the For- mosa Straits area this week. The Chinese Communists con- tinued to improve their capa- bilities in the area. Peiping may intend to re- frain from major assaults while exploring the possibility of negotiations with the United States. However, the Com- munists may at any time assault minor offshore islands in order to keep up some degree of pres- sure for negotiations. The primitive Afghan economy can probably carry on indefinitely even if most normal trade channels are blocked, as it did during World War II. Strong action by Pakistan in the near fu- ture would, h'wever, probably cause the Afghan government at least to review its trade with the USSR in an effort to determine whether a closer relationship were necessary, or advisable. The Afghan government has to date given no indication that it intends to comply with Pakistani demands, despite the fact that it is under pres- sure from several other Asian nations. India's V. K. Krishna Menon is going to Peiping soon to try-to clarify the Chinese Communist position on negotiations. The British charge in Peiping, instructed to make similar inquiries, has not been received by Chou En- lai. There are contradictory reports as to whether the Chinese Communists, in the interest of improving the atmosphere for negotiations, intend to release any of the detained Americans in the near future. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 OF IMMEDIATE INTEREST Page 5 of 7 25X1 Approved Fo Release 2005/0 ~8-'DP79-0092,7AQ00500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 Chinese Com- munist public state- ments continue to take a hard line on substantive issues which any negotia- tions might discuss. Peiping maintains that there is no need for a cease-fire, as the United States and Communist China are not at war. Similarly, Pei- ping asserts that For- mosa is an "internal" question, thus imply- ing that its status is not negotiable. The Chinese Commu- nists allege that the only "interna- tional" question is that of American "intervention," thus suggesting that the only matter to ne- gotiate is that of a withdrawal of American forces from the China area. hgtien sew ~ ; aochi 7C .TRUCTION ,. a PESCAJ OR EAST CHINA (incl. FORMOSA) Available Airfield (jet) Available Airfield (cony.) -Selected Road --+- Selected Railroad Proposed Railroad Naut.0 S0 10? "Miles 0 50 100 130 The Syrian political sit- uation, which has been relative- ly quiet while the controversial proposal for a Syrian-Saudi Arabian-Egyptian pact has been under consideration, is again threatening to erupt. The assassination of As- sistant Chief of Staff Malki on 22 April continues to pro- duce severe repercussions. His military partisans--the army clique led by Chief of Staff Shuqayr and backed by the left- ist Arab Socialist-Resurrection- ist Party (ASRP)--are endeavor- ing to force civilian authori- ties to provide legal cover for taking revenge on the Syrian Social National Party (SSNP), which they hold responsible for the murder. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 OF IMMEDIATE INTEREST Page 6 of 7 25X1 25X1 Approved For Release 2005/01/27 : CIA-RDP79-009000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 25X1 In the face of these tac- tics, the opposition--consisting chiefly of the ailing presi- dent, a Nationalist Party min- ority in the cabinet, and con- servative senior army officers-- is fighting only a rear-guard action. 25X1 ?fq Approved For Release 2005/01 DP79-00927A000500050001-3 PART I OF IMMEDIATE INTEREST Page 7 of 7 Approved Forlease 2005/01/27 : CIA-RDP79-0092 A00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 NOTES AND COMMENTS Harassment of West Berlin Continues The East German govern- ment appears to have adopted a policy of intermittent pin- pricks against West Berlin designed to make it difficult for the West to take effective countermeasures and to force the West Germans into negotia- tions with the East Germans at as high a political level as possible. The restrictive devices employed to date are few and relatively minor in comparison with measures the East German government could take to make life in West Ber- lin difficult. Two additional truckloads of scrap metals have been con- fiscated by the East Germans; four truckloads of cable drums have been impounded, two of which have been released; and a load of ball bearings has been removed from a railway car at Marienborn and confiscated. On 26 April the East Ger- man police started weighing all trucks at the Marienborn check point on the Helmstedt Autobahn and imposing fines of 50 marks per 100 kilograms of overload. Road traffic to Berlin, how- ever, is still moving at generally normal levels, be- cause of continued subsidies by the West German government. American officials in Ber- lin predict that within the next few days 20 to 25 addi- tional East German "scrap specialists" will probably be deployed to various water and rail check points. This may lead to additional minor harassments.- The East German govern- ment has clarified its po- sition somewhat regarding ne- gotiations on the truck toll. An editorial in Neues Deutsch- land on 30 April suggests that if the Federal Republic will agree to talks between repre- sentatives of the Transport Ministries, the East Germans will agree that the rank of the negotiators could be be- low the deputy minister level. The West Germans are anxious to keep the problem within the framework of inter- zonal trade talks, but are willing to add transport experts to these meetings. They are flatly opposed to holding high-level talks that might be construed as recog- nition of East German sover- eignty. Soviet high commissioner Pushkin agreed on 30 April to discuss the Berlin truck toll problem with the Western high commissioners. He insisted, however, that because the toll was not levied against the motor transport of the occupation powers, it was not within their competence to settle and was a matter for negotiation between East-and West Germany. Republic's trade. Pressure from West German businessmen may force Bonn to taper off its selective em- bargo on shipments to East Germany. Trade circles feel that Western stoppage of East German shipments through Hamburg would be as effective a form of pressure and would not injure the Federal SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 1 of 10 25X1 Approved Fo%g lease 2005/01/27 : CIA-RDP79-009200500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 Japan's Relations With the Sino-Soviet Bloc Japan's opening position in the talks with the USSR, scheduled to begin in London on 1 June, is taking shape. Prime Minister Hatoyama, in a reversal of his previous state- merits,"declared before the Diet last week that the settle- ment of such questions as fron- tier revisions, fishing areas, and the Japanese still held in Siberia was a condition for restoration of diplomatic rela- tions with Moscow. Hatoyama had insisted previously that Japan should first restore relations with Moscow and then talk about any outstanding issues. His pres- ent attitude more nearly coin- cides with the views of his foreign minister, Mamoru Shigemitsu. The Japanese are fully prepared for Soviet stalling on outstanding questions, how- ever, and will give ground about a month after the talks start and call for an exchange of ambassadors, according to one report. The Japanese would then pursue their bargaining in hopes of obtaining some commitments from the USSR. In a move to strengthen the Japanese delegation at the talks, Haruhiko Nishi, ambassador to Australia, will be appointed to fill the now vacant ambassadorial post in Great Britain. A senior offi- cial of the Tokyo Foreign Min- istry states that Nishi has had considerable experience with Soviet affairs and, with Shunichi Matsumoto, will form a "strong team." The Chinese Communists are continuing their efforts to maneuver the Japanese gov- ernment into de facto relations. Chou En-lai told Japan's dele- gate to the Afro-Asian con- ference that his government was prepared to repatriate Japanese still in China but that there would have to be something more than informal talks. A similar Chinese strategem was frustrated when the Jap- anese government refused to guarantee the execution of an $84,000,000 trade plan signed on 4 May by a private Japanese organization. Tokyo also re- fused to grant diplomatic rec- ognition to a proposed Chinese trade mission, despite pressure from Diet groups,, Japanese traders, and the Communists themselves. Nevertheless, the trade plan--concluded only after Hatoyama agreeu to extend his co-operation--pushed Japan one step further toward recogni- tion of the Peiping government. The two parties agreed in the plan to hold sample fairs and exchange permanent trade mis- sions. The inclusion of em- bargoed items in the trade plan will increase pressure on the Japanese government to work for an early relaxation of CHINCOM controls. Prime Minister Hatoyama reportedly is sending a per- sonal message to Mao Tse-tung stating that Japan wishes to accord diplomatic recognition to Communist China and that ne favors a policy of copros- perity and coexistence with China. Such a message would be hardly more than a friendly gesture since Hatoyama, who favors a "two Chinas" concept, fully recognizes that diplo- matic recognition at this time would be premature. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 2 of 10 Approved For Release 2005/01/27 : CIA-RDP79-009000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 This action contrasts with Hatoyama's recent Diet speeches in which he went out of his way to emphasize that Japan's basic policy is to maintain close ties with the United States. It illustrates Status of Top Soviet Leaders The Soviet leaders' por- traits were apparently ar- ranged on May Day to convey the impression that Party Secretary Khrushchev enjoys precedence but not unqualified pre-eminence. Premier Bul- ganin's picture displaced that of Khrushchev in first place in some of the displays, but the party secretary appeared in the number-one spot more often than the premier. Malenkov' s portrait was placed at or near the end of the gallery. He was third in line, however, when the pre- sidium members mounted the Lenin-Stalin tomb, and was shown standing between Khru - shchev and Kaganovich in the t,ic- turos published in the Soviet press the following day. These minor inconsisten- cies may have been designed to show that Malenkov's demotion denoted a realignment of po- May Day Military Parade In Moscow Unfavorable weather forced cancellation of the air portion of the military demonstration in Moscow on May Day, but the Soviet army displayed new or modified artillery. The main new item of equip- ment was a 200mm gun-howitzer his working assumption that Japan can maintain friendly relations with the Sino-Soviet bloc without endangering the benefits derived from Japan's alliance with the United States. litical power but has not un- dermined the stability of the collective leadership. Neither N. N. Shatalin, who is still formally a party secretary, nor N. M. Shvernik, a candidate member of the party presidium and chief of the Soviet trade unions, appeared at the ceremonies. Shvernik was last seen in public on 9 February and Shata- lin on 21 February, and their absence on May Day strengthens the supposition that neither is presently active in his post. There have been unsubstan- tiated reports that Shvernik, an Old Bolshevik who is now nearly 68, is ill. Nothing has been heard of Shatalin, re- garded as a protege of Malen- kov, and it is likely that he has been removed from the key post he held in the area of personnel appointments. with a modified recoil system, mounted on a single-wheeled carriage and towed by a heavy- tracked prime mover. The army attache reports that this is the same piece originally seen in a rehearsal and thought' to be of 240mm, caliber . SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 3 of 10 25X1 25X1 Approved For W ease 2005/01/27 : CIA-RDP79-00922 00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 This suggests that the weapon is not an entirely new departure, since the estimated caliber is more nearly con- sistent with previously employed Soviet artillery. The mounting, however, represents an improve- ment in mobility over the heavy artillery pieces now in use by Soviet field forces. Improvements in carriage were probably also incorporated in the new or modified 122mm antitank guns and 152mm gun- howitzers displayed in the parade. In addition, sixteen 122mm AA guns were displayed. This is the largest number of these new Soviet heavy anti- aircraft weapons seen at one time by American observers, although the sighting of small numbers of them in convoys in Moscow since late 1954 had sug- gested that they were to be added to the air defenses of the Soviet capital. There was no air show, but several new. planes had pre- viogsly appeared in practice flights. Eleven new jet heavy bomb- ers (BISON) were seen in a single rehearsal flight. Anal- ysis of aircraft numerals in- dicates, however, that as many as 13 different planes may have been involved in preparations for May Day. Formation flights of this type aircraft were noted in eight of the 11 practice flights observed by Western officials. Three of the new four- engine turboprop swept-wing aircraft, designated BEAR by Western intelligence, partici- pated in one of the last re- hearsals. Preliminary analysis tends to support evaluations of this plane as a bomber rather than as a cargo or tanker aircraft. The USSR may have intended to demonstrate advances in air defense as well as offensive air capabilities, inasmuch as a new twin-jet swept-wing all-weather fighter and a new single-jet fighter were also seen in pre-parade rehearsals. 25X1 25X1 SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 4 of 10 Approved For;lease 2005/01/27: CIA-RDP79-0092700500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 25X1 Cambodia Under the leadership of Prince Sihanouk, Cambodia is attempting to put a more neu- tralist face on its foreign policy. The former king--whose political activities since his abdication have increased rath- er than diminished--is quoted as saying at the Bandung con- ference that his country had definitely aligned itself with "the community of neutralist nations, including India and Burma." Through this and similar actions, Sihanouk apparently is attempting to counteract, both in the minds of his neigh- bors and of his own people, any thought that Cambodia's ties USSR Encourages Neutrality n the Near East The USSR is continuing energetically its campaign, launched in March, to dissuade Near Eastern countries from adhering to the Turkish-Iraqi pact. with the West will become too restrictive. Although the prince during his recent visit to New Delhi subscribed to the "five principles of peaceful coexistence," his firm anti- Communist policy in internal affairs has never been ques- tioned. Sihanouk's desire to pre- serve his country's new-found independence and forestall ac- cusations of close identifica- tion with Western interests makes him susceptible, however, to efforts by India.to bring Cambodia into its sphere of influence, and thus may ulti- mately damage Cambodia's rela, tions with the West. The campaign combines threats, suggestions that neutrality would have many advantages, and frank efforts to associate the USSR with the Arab cause. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 5 of 10 25X1 Approved For Release 2005/01/27 : CIA-RDP79-0092000500050001-3 NMI' SECRET CURRENT INTELLIGENCE-WEEKLY SUMMARY 5 May 1955 The USSR has made several gestures to strengthen its position in the Near East since the Soviet communique of 16 April which promised a "posi- tive attitude" toward any steps by Near Eastern countries to adhere to the "five princi- ples of coexistence" in their relations with the USSR. Radio Moscow, commemorat- ing on 26 April the 35th anni- versary of Kemal Ataturk's proposal for establishing relations with the USSR, quoted Ataturk as having said that the 1921 Soviet-Turkish "Agreement of Friendship and Brother- liness" had brought only "good- ness and benefits" to the Turks. The broadcast, which Tito Stalls on Closer Military es West In recent talks with the British and American ambassa- dors, Tito strongly emphasized that Yugoslavia is not in- terested in expanding its military ties with the West at this time. He said he wished to continue co-operation with the United States, but he told British ambassador Roberts on 21 April. that he would give up Western aid rather than start military planning talks now. Yugoslav leaders admit that Western requests for greater Yugoslav military was mild in comparison with recent Soviet propaganda on Turkey, noted that this belief assumes special importance now, "when relations between the Soviet Union and Turkey are in a state which makes their adjustment desirable." Following indications at Bandung of the Communist bloc's willingness to take an anti- Israeli position in the Pales- tine dispute, Soviet official- dom thoroughly shunned the national day reception given by the Israeli ambassador in Moscow on 27 April. This dis- play of official Soviet antip- athy to Israel cannot have been lost on the Arab diplomatic colony. co-operation are justified, but claim that these requests pose a real political dilemma for the regime. They fear that further military ties with the West would be incon- sistent with Belgrade's long- sought role of serving as a bridge between East and West, and providing leadership to other countries detached from iie power blocs. Tito acknowledged that his lessening interest in addi- tional military planning with the West results from an obvious difference between SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 6 of 10 25X1 Approved Fof elease 2005/01/27 : CIA-RDP79-009274000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 Yugoslavia and the West in appraising the world situa- tion. He suggested that some time this summer it would be useful to hold a conference between Yugoslavia and the Western powers to discuss their respective appraisals of the situation. The Yugoslavs believe that world tensions have re- laxed to such a degree that efforts should now be con- centrated on trying to solve East-West problems by ne- gotiations rather than by buildi-ag up a "line of bunkers." Tito spoke of a "tech- nical conference" with the United States, by which he probably meant a discussion of Yugoslavia's previously presented "shopping list" for additional aid. He pressed for such a. meeting soon despite the American ambassador's in- sistence that it would have little point. Tito promised to iron out difficulties the United States has encountered in supervising distribution of goods under its aid program in Yugoslavia. His attitude suggested that he wanted the present relationship to continue, although without enlargement in scope. With his proposals for a "situation appraisal." confer- ence later, and a "technical conference" now, Tito ap- parently hopes to avoid for the present Western pressure for strengthening military ties. He probably believes that delay may allow world tensions to abate sufficiently to make the whole question academic. Should world tensions again increase, the Yugoslavs are probably confident that their importance to the West' would be great enough to en- sure Western support whether or not Yugoslavia makes further commitments at this time. For the present the Yugo- slavs are probably content with the security commitments explicit in the Balkan al- liance and implicit in their military aid relationships with the big Western powers. Within the Balkan pact, they have continued to improve field-level co-operation with the Greeks in their common area of concern, but have rejected further links to NATO through the pact. Italian Presidential Elections The election on 29 April of Giovanni Gronchi, 67-year- old left-wing Christian Demo- cratic president of the Chamber of Deputies, as president of Italy was a victory for the parties of the left. The elec- tion outcome was largely the result of internal quarrels within the Christian Democratic Party, and is a severe blow to the prestige of Premier Scelba, and his center coalition gov- ernment. Gronchi's political career goes back to 1919, when he was one of the original leaders of Don Sturzo's Popular Party, the forerunner of the present Christian Democratic Party. He served in Mussolini's fix'st government, but soon joined the opposition and was expelled from parliament in 1926. He joined the Anti-Fascist Resist- ance in 1942, and since World War II has been a member of SECRET 25X1 Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 7 of 10 Approved Felease 2005/01/27 : CIA-RDP79-0097 -000500050001-3 SECRET 5 May 1955 the National Council of the Christian Democratic Party. He was minister of industry and commerce from 1944 to 1946, and became president of the Chamber of Deputies in 1948. Gronchi represents those who favor a government "opening to the left." He has been a consistent advocate of Christian Democratic collaboration with all "democratic" factions, in which he would include the Nenni Socialists. He has long argued that the.way to reduce Communist strength in Italy is to undertake a vigorous and far- reaching reform program. The presidential election, which Gronchi won on the fourth ballot with 658 out of a possible 843 votes, revealed a deep split within the Christian Democratic Party. The right and left fac- tions of the party refused to support the official party can- didate, Senate president Mertl- zagora, in the early ballots. The Christian Democratic lead- ership and some rightist ele- ments finally threw their votes to Gronchi in order to hide the fact that otherwise he would have been elected primarily by Nenni Socialist and Communist votes, Some 90 Christian Dem- ocrats;apparently refused to the very end to follow party directives. The Scelba cabinet will submit its resignation on 12 May, when Gronchi is inaugu- rated. Parliament is apparently determined to get the govern- ment off its present "dead center" and to break the stale- mate blocking implementation of any effective program, and it.may therefore decide on a change of premier, looking toward a shift either to the left or the right. Gronchi's personal choice for premier would probably be a Christian Democrat, perhaps Budget Minister Ezio Vanoni, whose economic plan the Nenni Socialists have already of- fered to support, Other possible premiers include Chiristian Democratic Party president Zoli, a non- controversial figure whose selection would be considered a temporary arrangement, and former premier Pella, a right- wing Christian Democrat, who is generally regarded as a temporizer. In any case, the parlia- ment's decision will almost certainly be made strictly in terms of domestic policies. While the next government may be somewhat to the left of Scelba's, no change is antici~ pated in Italy's pro-Western foreign policy. Iceland Strike Settled The settlement on 28 April The strike settlement, of the 42-day-long strike of which was evidently brought over 7,,000 Icelandic workers is on by the threat of a walkout a political victory for the in refrigeration plants, pro- Communists and left Socialist vides for a total wage increase elements which dominated the of 16 percent. strike. The wage increases granted will probably start a The employers will pay new inflationary spiral and 13 percent, including a 10 could lead to a devaluation of percent rise in the basic Iceland's currency. hourly wage, while the national SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 8 of 10 25X1 Approved Fc elease 2005/01/27 : CIA-RDP79-009 000500050001-3 ,. SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 and local governments will con- tribute 3 percent to the new unemployment insurance fund which the strike settlement provides for. The new agree- ments are valid until June 1956. The settlement is a vic- tory for the workers. The unions initially demanded wage increases of 30 to 40 percent, but were reported prepared from the start to accept about 15 percent. The employers insisted until late April that they would not go beyond 8 percent. The Communists and the left-wing Socialist leaders of the Icelandic Federation of Labor (IFL), who started and controlled the strike ac- tion, will be able to extract much propaganda value from the settlement. The general strike of 1952, when the IFL was con- trolled by the right-wing Socialists, was settled by the enactment of measures by the government which reduced the Guatemalan Regime Faces Serious Economic and Political Proble-ms Guatemala's continuing economic difficulties and in- ternal political rivalries are undermining the popularity and strength of President Castillo Armas. Unless the government's financial and political prob- lems are eased in the near future, Castillo's position will deteriorate, and coups may.be attempted. A start toward economic recovery evident early this year was suddenly reversed in mid- February with the drop in world prices for coffee, which has accounted for up to 80 percent by value of the coun- try's exports in recent years. cost of living by about 3 per- cent, but without any actual increase in wages. The Communists will be encouraged to capitalize on their newly won prestige to pursue their objective of attempting to create a new political bloc of all labor elements under the aegis of the IFL. Their ultimate ob- jective is to gain control of the government. The new wage scales will shortly become effective for all workers in Iceland. With- out additional government sub- sidies, which do not now ap- pear likely, these increases will raise the already high production costs. Increased pressure for devaluation of the currency in order to maintain petitive position of the com- Icelandic fish and fish products in world markets is almost cer tain to follow. 25X1 Unemployment remains high and there are growing signs of labor discontent. The government, which has pledged itself to do more in two years than the previous Communist-influenced govern- ments did in ten, is in finan- cial straits. Whereas the Arbenz regime spent $90,000,000 during its last year in of- fice, the Castillo government is expected to be able to budget only about $59,000,000 for the coming year. Ameri- can grant aid thus far approved in principle.-would raise the total to about $72,000,000. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 9 of 10 T Approved Fo elease 2005/01/27 : CIA-RDP79-009 7Ap00500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 Factionalism in the army and government also hinder the development of stable govern- ment. Resentment is believed to be still strong among regu- lar army officers displaced by veterans of Castillo's "Army of Liberation," who now hold most top military posi- tions. The "liberation" faction also controls many high civil- ian posts, and apparently as- pires to even greater control. Critical of Castillo's middle- of-the-road policies, this group has exerted strong pres- sure on him to "clean up once and for all" what it considers potential centers of opposition in the army and government. During April there was a marked increase in rumors of serious divisions within the government, and some evi- dence that these rumors origi- nated with the "liberation" faction. This evidence of growing suspicions and jeal- ousies may presage a new gov- ernment shake-up. If rumors of unrest continue to grow in intensity and the economy remains de- pressed, ambitious individ- uals, within and outside the administration, will probably feel encouraged to plot Cas- tillo's overthrow. SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART II NOTES AND COMMENTS Page 10 of 10 25X1 Approved For Release 2005/0~ ~ RDP79-00WA000500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 PATTERNS AND PERSPECTIVES THE EFFECT OF THE AUSTRIAN DEVELOPMENTS ON GERMANY Chancellor Adenauer's pro- Western policies will face a severe test during coming months as a result of the Soviet in- itiative on an Austrian settle- ment. There has been no signifi- cant growth of neutrality senti- ment in West Germany. However, plans for a German settlement modifying Germany's position within the Western defense al- liance are being advanced in West Germany and elsewhere in Western Europe. Bundestag leaders generally feel the public recognizes the vast differences between the Austrian and German situations, although there may be a small rise in neutralist sentiment if and when an Austrian treaty is actually concluded. Public attention in West Germany is now fixed on the terms for German unification which Moscow may propose at the hoped-for East-West conference this summer. In previous con- ferences the Soviet Union has always been handicapped in its efforts to sway German opinion by the basic West German dis- trust of the Kremlin's inten- tions and declarations. An Austrian settlement would modify this distrust somewhat, since it would be regarded as evi- dence of Soviet willingness to conclude agreements on major European issues, perhaps even such as would call for with- drawals of Soviet troops. In the Soviet-Allied strug- gle over German unity and neutrality, the fundamental issues remain:(1) how an all- German government should be formed and (2) whether that government should be free to join alliances. While all West German political parties are at pres- ent agreed that free elections are indispensable as a first step toward unification, there is considerable disagreement on the question of alliances. Adenauer's Christian Democratic Union is the only strong ad- vocate of the principle that freedom to join alliances must be a condition for unity. The opposition Social Democrats have openly stated that the Paris accords should be bartered away at the next four-power meeting, and that neutrality should be accepted in return for the holding of free all-German elections. There are indications that some factions of the minor coalition parties are sus- ceptible to this argument. Adenauer, speaking through his personal envoy in London, stated last wee', that in the light of Austrian developments and expected Soviet maneuvers, the West cannot at the next big-power meeting simply repeat its 1954 demands for free elections and freedom to form alliances and hope to retain the firm support of German public opinion. Adenauer fears that at the four-power conference the Soviet Union would ostensibly accept the principle of free elections as the first step toward unification, hoping to have it rejected because it would be premised on Germany's neutralization. A summary re- jection of such a proposal would put the onus on the West for any failure of the confer- ence and would gravely weaken the chancellor's position. The chancellor has sug- gested that the West offer to SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART III PATTERNS AND PERSPECTIVES Page l of 8 Approved Release 2005/01/27: CIA-RDP79-0092 000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 include the Soviet Union and its Satellites in a new security system encompassing all of Europe, Canada, and the United States. The proposal calls for arms limitation, inspection of defense establishments, and a system of nonaggression and mutual assistance agreements. West Germany's present NATO commitments would not be af- fected by the plan. By offering guarantees against future German aggres- sion, Adenauer hopes to demon- strate that the Soviet Union has no valid excuse for in- sisting on German neutrality, and is only using the alliance issue as a pretext for prevent- ing German unification. To his critics who claim the USSR will never release East Germany because East Germany would then only be added to the Western military potential, the chan- cellor has already hinted that the East zone should be demili- tarized following unification. Privately Adenauer and his advisers state that unity is probably unattainable at this time. The chancellor believes his government will be in a better position to deal with the problem of unification sev- eral years hence when an East- West detente may be possible. Adenauer considers that his most important task at present is to get his country firmly established within its present alliances. He believes that if he can win the 1957 federal elections, future ad- ministrations will not attempt to break these Western ties. During the next several months, Adenauer's policies will undergo severe tests. Not only will an Austrian settlement create some public confidence in Soviet proposals at the projected conference, but the ratification of the Paris accords and the advent of rearmament have already occasioned something of a now-or-never attitude on unity in West Germany. In addition, public opinion has always been susceptible to the idea of a neutrality commitment in order to obtain free elections. The Bonn government, how- ever, will probably not de- viate from its present course unless Moscow is willing to accept virtually intact the Western terms for unification. The locus of power in the Federal Republic remains fixed in the hands of a government leader who is determined to avoid neutrality and whose great popularity completely eclipses that of any other public figure. Public opinion polls in 1954 showed that the West German people were willing to accept neutrality in ex- change for free all-German elections--but only on the condition that the West guaran- tee such an arrangement. The West Germans continue to assert that unity is Bonn's foremost goal, but it is apparent that they do not want to risk their present security to attain it. In a large meas- ure the chief issue in the Federal Republic is not unity, but prosperity. As long as the Adenauer government makes reasonable moves to counteract Moscow's unity propaganda and there is no drop in living standards, the government will probably be able to keep the nation within its Western alliances. 25X1 SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART III PATTERNS AND PERSPECTIVES Page 2 of 8 Approved Felease 2005/01/27 : CIA-RDP79-009- SECRET 4000500050001-3 CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 CHINESE COMMUNIST TACTICS IN SOUTHEAST ASIA Chou En-lai's public com- mitment at Bandung to peaceful aims and methods strengthens the probability that Peiping will continue to emphasize the conciliatory aspects of its policies toward Southeast Asia. In dealing with Southeast Asia, Communist China has gen- erally followed two parallel lines: one has been concilia- tory, featuring repeated dec- larations of peaceful intentions and a desire for normal rela- tions with all the countries of Asia; the other has'.been threat- ening. While it has increased its military capabilities in South China, Peiping has pointed out the "dangers" of military alliances among Asian nations, particularly those including Western powers. Communist propaganda has singled out the Thai government for criticism as a puppet of American imperial- ism, and last summer former Thai premier Pridi Phanamyong, now in exile in Peiping, was permitted to broadcast this theme over Peiping radio. In recent weeks, Chinese Communist propaganda has sup- pressed the more threatening aspects of the approach to .Southeast Asia in favor of an intensified attack on American motives and intentions toward the area. The Afro-Asian conference provided Premier Chou En-lai with an excellent opportunity to stress the conciliatory aspects of Communist China's policy. In speeches to the con- ference and in private state- ments to Southeast Asian dele- gates, Chou denied charges that Communist China has designs on Southeast Asia. He said in his first speech that "China has no intention whatever of subverting the government of its neighboring countries." Chou made vigorous attempts at Bandung to reassure the Southeast Asian countries. Even Thailand and the Philip- pines, the most Western- oriented of those countries, were objects of these efforts. Thailand and the Philippines In his speech to the con- ference on 23 April, Chou said that fear of China on the part of Thailand and the Philip- pines was quite natural "since we lack mutual understanding." He added that "we have given assurances to Prince Wan of Thailand and General Romulo of the Philippines that we will not engage in any aggression or make direct threats against Thailand or the Philippines." Viet Minh foreign minister Pham Van Dong backed up Chou's moves by agreeing on the re- settlement of Vietnamese refu- gees in northeast Thailand. Chou invited representa- tives of Thailand to visit Yunnan Province to assure them- selves that Peiping was not permitting the training of a guerrilla- force for the eventual "liberation" of Thailand. Prince Wan has indicated that he cannot make the trip but has not denied the possibility that a delegation may be sent. In spite of the fact that the two countries "have no common border," Chou also in- vited a delegation from the Philippines to visit Communist China, especially Fukien and Kwangtung Provinces, to see that Communist China has no aggressive intentions toward the Philippines. Indochina Chou reiterated assurances given at Geneva that Communist SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART III PATTERNS AND PERSPECTIVES Page 3 of 8 Approved FQ elease 2005/01/27 : CIA-RDP79-009000500050001-3 SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 China would not intervene in the internal affairs of the Indochinese states, mentioning Laos and Cambodia specifically. He was silent on Vietnam. He said China's policy toward these states was typical of its policy toward all countries. Both Nehru and Chou were present when the delegations BURMA Pop. 18,300,000 Chinese 350,000 India indicated its inter- est in Laos and Cambodia by recognizing Cambodia last December and sending a consul general to Laos in January. Nehru appears resigned to the eventual absorption of South Vietnam by North Vietnam as a result of the elections sched- uled to take place in July 1956. DISTRIBUTION OF CHINESE IN SOUTHEAST ASIA The bar gran is divided nisi-l1, Into units proponionatp la he tol.i popmetlon of the '"'Was and areas named. Dlmsione w,thin these units shpt the percenUge .,,he population that is Chinese. The Chinese population throughout the area is conceneated mostly in the serge cities. the most important of which ere acceniM on In. map by larg. colored dote. All fIWres are epproaimete. to RUNEI Popd 0600 Chinon 10,000 N.BORNEO Pop. 330,000 Chinon MODD of North Vietnam and Laos reached their understanding that the question of the Com- munist-led Pathet Lao forces would be considered an inter- nal affair of Laos. Pham and Laotian premier Katay expressed the hope that the problem could be settled in accordance with the "five principles." The presence of Nehru and Chou suggests a tacit Indian-Chinese Communist agreement on the countries' interests in South- east Asia, INDONESIA Pop. 79,000,000 Chinon 2,500,000 Indonesia 0 Chinese Nationalist Embassy 0 Chinese Communist Embassy . Chinese Communist Consulate S Bank of China Branch Chou pointed out to other Southeast Asian countries what he said were the advantages of the treaty on dual nationality which was concluded between China and Indonesia during the Afro-Asian conference. It was hinted that other countries with substantial Chinese minor- ities might obtain similar agreements if they recognized Communist China. After'Bandung, Chou remain- ed in Indonesia on a two-day MALAYA! \ K.mlour THAILAND Pop. 18,500,000 MALAYA Chine> 3,000,000 ,300, SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART III PATTERNS AND PERSPECTIVES Page 4 of 8 Approved Fi Release 2005/01/27: CIA-RDP79-00000500050001-3 ...SECRET CURRENT INTELLIGENCE WEEKLY SUMMARY 5 May 1955 state visit during which he was accorded unusual honors. Chou and President Sukarno signed a joint statement affirming the "five principles" of co- existence, thus associating Indonesia with India and Burma, which arrived at similar under- standings with Peiping last summer. The Chou-Sukarno statement included a declaration of the "inalienable right" of any people "to safeguard their sovereignty and territorial integrity." Burma Peiping apparently also improved its relationship with Burma during the conference. Chou stayed in Rangoon both going to and coming from Bandung, and talked at length with Premier U Nu. Chou's conciliatory atti- tude appears to have lulled the suspicions of some of the Ban- dung delegates whose governments have been most hostile to . Peiping. Both Prince Wan and General Romulo have testified to their belief in Chou's "sincerity." They were also made to feel that Chou's apparent relaxation of his position on the Formosa issue was due in part to efforts by themselves and other Asian states to seek a peaceful solution to the problem. The premiers of Laos, Pakistan, and Ceylon-expressed similar sen- timents. Chou's public commitment at Bandung to peaceful aims and methods increases the likelihood that Peiping will continue to be cautious in its policies toward Southeast Asia in order to avoid alienating any sub- stantial portion of Asian opinion. Communist China is likely to rely primarily on normal diplomatic procedures in dealing with those countries with which it has formal rela-' tions and to continue efforts to establish such relations with other countries. Peiping's assistance to North Vietnam provides an opportunity for indirect Chinese influence ' is the adjacent areas of South Vietnam, Laos,. and Cambodia. For example, direct aid to North Vietnam facilitates Viet Minh support of Pathet Lao activities in northern Laos. Chinese Communist encouragement of subversion in other parts of Indochina will probably also come through the agency of the Viet Minh. Thailand is also susceptible to subversion through Communist-supported forces in Laos. Even in areas of Southeast Asia which are hostile to Communist China, it is likely that Peiping will limit itself to promoting Communist objectives covertly through indigenous movements in order to deflect charges of interference in the internal affairs ox otner countries. 25X1 25X6 SECRET Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 PART III PATTERNS AND PERSPECTIVES Page 5 of 8 25X6 Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3 Next 2 Page(s) In Document Exempt Approved For Release 2005/01/27 : CIA-RDP79-00927A000500050001-3