OFFICE OF REPORTS AND ESTIMATES, CIA FAR EAST/PACIFIC BRANCH INTELLIGENCE HIGHLIGHTS NO. 63 10 AUGUST - 16 AUGUST 1949

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01090A000500030019-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 9, 2016
• Document Release Date: January 26, 1999
• Sequence Number: 19
• Content Type: PERRPT

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munist mnvement6 Nationalist officials inolzxdinr~ Acting; President Li,
sk;ow camparatyle restraint an~3 express hope for early imrl.er~entation of
anti>Gom;?r~unist r~easureso sltho~x~;h certain Kuomintang leaders and papex?s
pare more ~.gorous in their criticisms of the 1hi be Paper and i.~ their
appeals for additional t~'S aides If and when 1:he ?~ations,tists are corn?~-
?~rinced that further ~ aid will not be forthLOmin~;a their comments on
the ~~hit8 Paper and on US policy probably will be far less diplomatioa
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Ccsntinueci militai~r succt~ase~$-=a The Corar-unist military machine, press~,r~ ?,A~
fors~%rd orz all fronts last week? introduced a new ea~-phibioua t',rr~.at to
operations ixz an attempt to w?aken the sur7yri6in~ly sffect~.ve i~Tationalist
naval blockade of Goz?~iunicat-held ports4 TFae Nationalists ;?a~ ground at
all points of contact and came no closer to unifying; their remaining;
forces to prevent ~e inexorable oblitera43on of their control in Chizxaa
Ambioua 0 eratians-~-On 11 August, the Communists launched an.
amphibious assau t on ~lationalist naval base area in the ?4iaotao
Islands, which reach upw~ird a.n an c~ro from the Werth r, oast of the Shsxa.=
t-un~ peninsula towt-rd $aviet-occupied Part Arthur., These islands have
T1!~avided the Nationalist Navy with a. vantage point far sur~illanc~a of
ahipnin~ in the Gulf of Chihli and allowed the blockade of the important
port of Tientsint According to press reports, some i4~2Q*OOQ Comrrtun~.sts
~roRSSd the narrow stretch of water in small dunks and motor launches
to occupy three of the many islands in the ~roupa Admiral Kwei, t~at:~on-
s.list Tds,vy .Chief, admits the loss of Changahan Islands on s~ahich ~?he
principal Government naval installations were located,
Ano~..her such amphibious assault reportedly is bain~ readied further
to the south, on the Ghekis.np; coast, where some 30-?497,ppp Co~~,uniste are
said to by preparing far attacks on. the Chazsart Islands, the base for
Nationalist naval units blockading Sha,nphaa~ While capture of both ~e
liiaa and. Chuean groups will not necessarily end the naval blockade of
Communist ports; each of thew aperat~.ons v~Il proTride the Communists
tivith valuable amphi.bzous e~cperienoe~
N'orthti~aest AEI*rsr..ce-wNat;ianalist x~sistance to the Communist drive
into Yansrz prrsvines hQS not been in evidence rind none seems to be fog-s:e--
in~, Ins-etzs x-sports claim that csivilian evac,zation of I,anchov~r, nrovi~~cial
capi trzl, is undertivay find. Tung;swi, Tsingnin~ and ire or~int mountain
~zardzng Lsnchaw have fallen to the Carnmunistsn Both the t'As, tot.ztedsins
nany grzarters as last-ditch fighters against the Gorm+unists, are en ro,zte
~.do Canton f`or r'military~ conferences". One report ^tates that the ?'!As n.ow
are biokerin~ over the control of ltansu and that ~~a. Pu-fanT^ has withdravan
his forces from their positiozzs in caatern Kansu to i;he Tsinin~ area in
his home province of Tsin~,haio Communist forces, nushinp~ front STiensi and
ltansu, also are threatening the south border of Y~ing*haia province?
k'urther east, according to a press report, the yatianc~,list Gavesnor
of S7.~iyuan provlnce, in recomnitiori of his straitened ciroumstancec~, is
quietly turnix:g; the province aver to the Comr+~un:i:.tsa Garrisons at Kueisui,
Suiyuan's capital, and 1'sotouq terminus of the rail line from Psi an
have eeceptsd Communist surrender terms and onlt p? ~,
western portions of Suiyuan still retain nominal. ~ esevithmtheoTlational~istso
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Canton dri~rv~-In south Ch~.xam, the c:drrununists are pushing, fori~z~~d
in three soatorsA In the advance on Itengyang? the*~ by-passed Hes~gshan~,
some ~a miles to the earths t3xsits operating nearer the :twangt,zng border
Uy-passed the FTationaliat base a?t Kaatzsiert and entered ?dankan~; to the
southwest? Unoffiaia2 reports sa;,r that lis.nhsien itself subeeq?eratly fell.
On the esoutheast asset, Fooaho~rb aapital of Fukierz, is bein{? slowly
enaircled and Coru7unist units reportedly have extended their aati~rtty to
Futsi7ig= direfltly south of Fooflhow on the ooast road to Amoy
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I:o Chi t,~inh rapprochement hints--Recent l~'rarsoh staterrsents that the Sao Dai
goverrunent vrill be responaible?9 for the return of internal pease in
~'ie~zam riay indiflat~- both a desire to Maass the beak to Bao i)si and ?s.c,oroval
of .a possible Isao Uai~-Iio chi. ;3inh rapprocher~~ant., The Ch~.ef of Staff of the
French Array spoke recently in Paris of a desire to strengthen the national
foraes of I3eo I)ai sa that 'r'ra:rzoeys ~,artiflipation in. the paei:z":~.catiori of
Vietnam cczuld be reducedp a statenzant attributed- to ~li~;h Coru,iissioner
Pi~zon i~-:plied the possi~?ility of net*ot3.r~tion between Ho and Ba.o Uai and
Przsic3~snt Aurial;~ in a letter to the Emperor, emphasized first ~'ranfle woztld
weloome a deaision of thr~ trietnamese people to "un3.te for tize cescatian of
hostil.ities~" The ';mister for Overseas F~:anReF now visiting Zncitsehina,
?ass stated that 'the r~:snonsibilitlr for inde~e,,denac7 and. the return of
,~eacc~ rests sr~uarely ,zpozx tine ~Tiettrtzmese people and ttxe latest in u series
of French hints harp co=no from an oft'ioial of the TLith car-~rrassari~zt ari :Lndaa
chin-ap ivho pointed out Y~ia belief tkiat one objective cz~' the Auriol latter
wzxs to ?naoura~*e ~'ao i to "undertake negotiations with the 'lint I'i!:ic ~
at iesxest tivitii flertain elements thererxf an
T'~,p: flruflie.l questiean raised by all tilQSe hints is ?c~hether ti;e i~'renah
intend that Boo Uai steal tivith Ho or azalg with the non--Communist resistanoe
o~ =~nents na~v ,~,zpflortxx~.~; Hoe Sinoe De;;ozaUer~ 1J~4?, the Fre~nah ofi'ioiali.y
htxve refutsed to trAat furt'aer vrxth I3o on t~,.e ba.s5.s of his comAnunist 1-,sok-
#-rc~undn The same polifly has annare;yztly been fczllczwed by pest French-
sponsored regir~Yes in Vietnezra~ although clandestine conversation~o ?~a~t have
taken plane, If the I'rene? have cieflided to permit negotiation, Uetereerc
Pars Doi and represan~-atives of the resistance ~;overnme~nt, 'bath R. savin~-
of F'rsnah faoe arzd a majoz~ chance in French policy have bear. effected,
I f confronted vri+..h ti,e realizatzon thtit the :'ranch act,zally;~ expect hire
to mske peace and zto longer opi:csse az~ accord c~rith 2Ic,Q Aac t)ai, i:a *azrng
nrobsbly will not izesitate to rake a deal rather them fafl~- the task of
flar:tinuing warf are kr~, th lessenin!*; Frereh sazn~>or~:,
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SECRE 1`
Phibu~.~osit:~on wea~eng--~-AI~.~ne~d~ aver nie w~al~an3,nk; political pos3~t3;nn,, ~,~,n
Premier P}tub 1~, pra~ently ig attpmptin~ ?~ persuade oerl:aa,n golitical
"outs" to loin the Gavernmen?t and thereby provide his re~3me w~~.th wi.dc~r
political beck3xz~*~ Ate Phibul grobahly wall not bs able to obtain such
$upportA hm will oantinue to rely ukian armed ford for his potiver and
will rewire azt extension of police cantrals to ward ak;ainst -tkse growing;
prabability of another csaup attempt,
Although the nevr Pkiibul aabin$t reoently carr3.ed a ~-.1 vote of can~?
f idene~s (see Inte3li~enea~ .Fii~;hli~hts ~}fil) in the Lower Hausa of Parlisrzsnt,
this support now +~ppecdrs precarious in light of ~3.) the de torrained s vren~;th
of the appos~.tion Denscacrat pr.~rtym (2) the formation cif a new opposi Lion
group incsludin~; impartarat i.nciepQndents and$ {~) the resgration of several
mer-bers of the pro-Ph3.bul pe~rty. Furthe~? cozitributi.n~; -tzy instsbil3typ tixe
Az~rzy~ which forrinrly banked the Premier ~holeheertedly~ i~ believed to ktav~e
become sa fasstianalized that its support is unreliaal?,~. Ta offset these
dr~velarnnents, a s~?,eoial police force has omen created? ~~Yxder the control
of a trt,sted member of Phibul's milit~,y elique< Phibul is reported to
depend wholly upon tree 600 men of this ua~it to maintain hir~self f.n officr~,
Tkte Thai 21a?~y, which until early 1948 maintaitl?d a zieutral position
in domestics noliticss` has bmaosze bitterly apposed to Phibu3Pg militarr~;~
alaqueo tdotiv that the ~'Tavy~ s capabilities for land vsrs,rfare apnroe~oh equality
with these of the farces supporting; Phibul, that servicse shows increasing
evidence of atstive hostility and a strr~ag inolinatian to oollaboratP vr3.th
onpas i tian p;raups in ord~sr to overthrow the p'hibul re girne
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