DAILY DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000400320001-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 19
• Document Creation Date: December 22, 2016
• Document Release Date: May 31, 2012
• Sequence Number: 1
• Publication Date: October 9, 1951
• Content Type: SUMMARY

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TOP SECRET
9 October 1951
CIA No. 49368
Copy No:14 3
DAILY DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This summary of significant reports has been prepared primarily
for the internal use of the Office of Current Intelligence. It does
not represent a complete coverage of all current reports in CIA
or in the Office of Current Intelligence. Comments represent the
immediate views of the Office of Current Intelligence.
Al CHMAL RECORD 25X1
PLEASE RETURN TO
A
GCY ARCHIVES,
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SECTION 1 (SOVIET)
1. USSR. Embassy Moscow comments on Stalin's atomic bomb interview: The
US US Embassy in Moscow characterizes-Stalin's.Pv.a.interview onthe
atomic bomb as a "strong, aggressive" statement. directed particullar to
the United States. The Embassy suggests that the Kremlin may consider
the Soviet atomic weapons program now sufficiently advanced to warrant
a belligerent attitude toward the West and reassurance to the Orbit that
the armament gap has been spanned,
The Embassy does not see in Stalin's references to controls any
increased possibility of a compromise control solution. It feels that
his statement was apparently intended to frighten the West into accept-
ing the Soviet control scheme, since agreement even on the USSR's terms
previously offered in the UN was not mentioned.
C_ooee tx Stalints admission that the USSR now has developed and
tested the atomic bomb follows the-USSR propaganda theme on atomic energy
adopted last August? At that true, in contradiction to the Russians'
earlier line, the Presidium of the Supreme Soviet announced that "only
after a ban on atomic weapons is imposed can atomic power be truly
utilized for peaceful purposes."
In view of the publicity given to US development of atomic weapons,
the USSR undoubtedly wishes to impress upon the world that the Soviet
armed forces also possess strength in the same field. Stalin's timing
was probably determined by the official US announcement; what he said
was obviously phrased to reconcile the development of the bomb with the
various lines of the Soviet "peace campaign."
2. YUGOSLAVIA. Government attempts to circumscribe size and authority of
Unitary aid staffs The Yugoslav Government has requested that the
US-Yugoslav bilateral military aid agreement be amended to specify that
the US military advisory group operate as part of the office of the
Military Attache and not as part of the US Embassy as the agreement now
reads, It also insists that the US military staff total not more than
15 or 16 including 6 to 8 officers and that the supervision of the use
and condition of arms supplied by the US be confined to Yugoslav proving
grounds. The Foreign Office official who presented the Yugoslav views
appeared somewhat embarrassed defending the Yugoslav position and
expressed hope that the points of difference could be settled before or
during General Collins' visit,
Co eat: Although the draft of the bilateral military aid agree-
ment was handed to the Yugoslav Government on 5 September, Yugoslav
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3.
efforts to circumscribe the size and authority of the US military group
have delayed its signature, The Yugoslav Government has resisted a US
compromise plan that the US military supervisory group initially total
30 persons operating as part of the US Embassy and responsible to the
Ambassador, Yugoslav military officials have also attempted to limit
the supervisory powers of the group, The Yugoslav attitude can probably
be explained in part as an attempt to avoid a repetition of its experience
with the Soviet military mission prior to the Cominform break, but it
also reflects the regime's deep-rooted suspicions of the West.
.Cabinet reoraanizeds The Yugoslav Goverment has abolished the
Ministry of Foreign Trade and distributed its functions among three
other governmental agencies4 the Economic Council, the Ministry of
Finance and the Ministry of Foreign Affairs. Four economic councils
of the government primarily concerned with heavy industry were also
abolished and their functions taken over by a newly organized Council
for Industry and Building under the direction of Svetozar (Tempo)
Vukmanovic, candidate Politburo member and previously Minister-Chairman
of one of the four abolished councils. Former Foreign Trade Minister
Milentije Popovic became Minister of Finance and the former Minister of
FI 'g Y9 e]t~eAer, sse.w ems.---.~Se_1 -5 -
a member of the Economic Council.
Cis The Cabinet shakeup is apparently the latest step in the
Yugoslav efforts to improve its economic and financial system, In April
the government abolished several economic ministries and transferred
their operative functions to the republic governments in an effort to
increase local initiatre and eliminate bureaucracy. There have been
recent reports that a reshuffle of the Ministries of Foreign Trade and
Finance was imminent and that one of the two ministers would be replaced.
The appointment of Popovic as Minister of Finance indicates that his
status has not been affected, while the appointment of the former Minister
of Finance as a member of the Economic Council does not indicate that his
position is insecure. One Politburo member, Franc I,eskovsek, lost his
Cabinet position as a result of the reshuffle, but there is no evidence
indicating that his Party stature is declining,
4. Tit ,attacksWestern critics; In a speech before 50.000 people in
Serbia., Marshal Tito stated that "the West has Yugoslavia for an ally on
all questions concerning equal relations among nations, the independence
of small countries., and the
preservation of peace. Although he
characterized Western aid as resulting from a desire to create a strong
and firm Yugoslavia rather than from an attempt to influence or subvert..
Tito warned of the presence of enemies in the West, partijularly the
Catholic Church, He observed that the West appeared ready and willing to
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support Yugoslavia when she opposed the Russians., but that there was no
support for "our building socialism." Tito denied that the reorgani-
zation of the state administration was a result of pressure from the West.
Go rat: This statement illustrates a recent tendency to attack
those elements in the West who pose a threat to the type of aid acceptable
to the Tito regime, Otherwise the speech is merely an additional attempt
to Justify Western aid and continued devotion to the building of real
socialism in Yugoslavia despite the hostility of critics and enemies abroad,
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9 Oct 5].
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ccuri,ng in Central Luzon. It ;q of+o? greatest number of incidents
SECTION 2 (EASTERN)
1. INDOCHINA_ Sino-Viet Minh solidarit em hasizeds The US Char e
in Saigon reports that the theme of Sinc-Viet Minh g
unusual emphasis in recent Viet Minh broadcasts. Only ~b Itperfectved
cooperation" between the two countries, the broadcasts h Veperfect
argued,,could victory be achieved,
such arguments may be in the nature ofe rearge speculates that
Chinese domination of the Viet Minh p paration for increasing 25X1
Comment: There are occasional reports that many Viet Minh
leaders resent the growth of Chinese Communist influence over the
Viet Minh, but these reports remain unconfirmed. Outwardly,
Viet Minh and Chinese Communists have maintained complete accord.
2. PHILIPPINES. pre--election violence continues but re istration roceeds:
pre-election violence continues with th
an inspects the government administration -e- regional"and provincial
influential'# department is the most
it" inn their various actiuitiese other departments "cannot, avoid consulting
ostensibly responsible for "cooperatinhe Unwith t
ited Front Department attached to the regime, actually has the job of he
reducing those parties
to "'puppets," a task facilitated by the dependence of theser:partiest1es a
on the CCP for funds, government control of their activities, the high
proportion of fellow-travelers.; in these parties, and,.most important,
extensive infiltration of these parties by covert members of the CCP;
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__0
recommends personnel assi a ten r~
from the Politburo down, gnments to Party organs
bureaus d receives the reports of th
merit (Orgburo) -- which maintains
register of Party membe
rmation, and Social Affairs.
(l) the Organization De art
-l ins the functions of the CCP': departments
United Front Info
y ilus ana those by the rival arti.esor~uc
intra-party factions. Registration as a whole, however has
with no more than the usual delays' Defense Secretary proceeded
received bi-partisan commendation for his apparently detteerininedy efforts
to use the armed forces ~TOfulladvanta,i~~ protecting the electorate.
Comments Magsaysay's integrity is generally accepted, and with
President Quirino outside the country he has virtually a free hand in
his policing efforts.
CHINA: Functions of Chinese Communist part de rtments are clarified:
4
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personnel and Party members:.
(3) the Information Department -- concerned with indoctrination of Party
members, cultural activities and publicity ?? controls what Party
members may read and be taught, directs education of all kinds in the
government, armed forces and private organizations, establishes the line
to be followed in all propaganda media, and is involved in censorship;
and (4) the Social Affairs Department appears to be the CCPos "intelligence
arm," responsible for supervising and coordinating the work of all intel-
ligence agencies and checking on the security of the regimes key
Comment:) the functions of the CCP's four principal
The activities of the Social Affairs Department, however, are still largely
obscure; while this department apparently has an intelligence and security
function, its jurisdiction has not been reliably defined. The
orgnaization of the CCP approximates that of the Communist Party of the
Soviet Union, and the chief of each of these CCP departments is a confirmed
Stalinist.
departments is generally confirmed
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25X6 DIA
6, Peiping publicizes Stalin's interview on soviet atomic developmgnts0
The Peiping People's Daily, the official organ of the Chinese Communist r arty,
characterizes a n'ss I erview on Soviet atomic developments as a "grqa^,t
inspiration for world peace" and as a guarantee of the security of the gpviet
bloc. The newspaper quotes-Stalin's argument that Soviet achievements in
the development of atomic weapons will persuade the US that there is no ad-
.vantage in "atomic militarism," thus making possible the prohibition of
atomic weapons on Soviet terms, Vyshinsky is also quoted as declaring in
1949 that, should the USSR "unfortunately happen" to need atomic wea on
it will have "as many as will be required." 25X1
Continent. In the past, Peiping has rarely' commented on developmentq. in
the field o atomic energy, and has minimized the capabilities of a tomiq
weapons. Peiping's line will presumably change to emphasize Soviet equq:l-
ity with or superiority to the US in this field.
Italians plan truck shipments to Chinese Communists. According to
the Bong Kong government, a group in Genoa is p tinning to ship used trucks
valued at 100,000 dollars to Lisbon or Tangier for transshipment to I1ac&o,
From Macao, the trucks will go t o Communist China.
Comments Direct shipments to Macao are considered suspect by Western
expor coon rrol officials
e o is vesse i ins Z ,612 GT), which recent];y
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arrived at the South China port of Whampoa, obtained bunkers that had been
shipped to Whampoa in railroad carne
Comment., With Polish-flag ships finding difficulty in buying bunkers
elsewhere in the Far East9 China is being called upon to supply the needed
fuel. The pinch will be felt particularly by Nhampoa, now an important
port of discharge forwossels in the China traded A large part of VPhampga's
supplies of fuel comes from non-Orbit sources, mostly smuggled via Macao
and Hong Kong. The demands of Polish vessels, however, may require an
addition to smuggled supplies and force increasing diversion of stocks from 25X1
the north, with a consequent tax on China's limited rolling stock facilities.
100 Extent of Communist military control of Tibet reported: The Indian
press reports that Chinese Communist forces are now in full control x of
the road leading from Lhasa southwest to India, and that an air base has
been built at Chamdo, almost LkOO miles northeast of Lhasa.
Comments The terms of the Sino-Tibetan agreement of 23 May 1951 pro-
vided for the movement of Communist troops into Tibet with the cooperation
of the Tibetan authorities. Peiping 25X1
Radio's claim that Communist forces are in Lhasa. It would be reasonable to
suppose that some of these troops had been dispatched to man fortified points
on the road from Lhasa south to India.
No other reports of the construction of an air base at Chamdo have been
received. Since confirmation is lacking, and since Indian press stories on
Communist activities in Tibet have proved notoriously unreliable in the past,
this report should be regarded with reserve.
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NOW
llo KOREA. Rhee predicts imiinent victo According to a US news source,
South Koreas president yngman Then a 6 October speech in southwestern
Korea said that the Korean war is almost won. Ile added that his troops
would defend the Yalu river.
Comment: Rhee is frequently prone to overlook the military realities
of the si uation. This latest pronouncement would seem to be in furtherance
of Rheets suspected Campaign to terminate the cease-fire talks and to get
on with the war.
25X1
13o Chinese Communist armored division moves farther east: On the basis
sin a inese Communist L.7th 25X1
of aerial si ngs of we -camo age tanks 1-
Army sector of the central front, the US Far East Command has accepted the
Chinese Communist 1st Armored Division in the vicinity of Sojae-dong, 10.
miles east of its last reported position.
Comment: It is probable that this move was made to counter any UN
penetration that might occur in this sector in the course of the current
UN "limited offensive." An additional? although speculative, possibility
is that this armor is organic to the Chinese Communist 47th Army as was
reported by a defected Chinese Communist lieutenant colonel from the L17th
Army.
114,
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SECTION 3 (WESTERN)
2. FRANCE. Friction developing between US troops in France and the local
o u ation: The U Embassy in Paris is concerned over the serious friction
that iss likely to develop between US troops in France and the local
population. The presence of foreign troops on French soil inevitably recalls
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*00, 111W.
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the German occupation, and hence provides fertile grounds for effective
Communist distortion and magnification of local incidents. Language barriers,
the superior pay and facilities of the US soldier, and the psychological risk
in transferring troops from occupied Germany to France constitute sources of
serious tension.
The Embassy considers that prompt attention to this problem is of
primary importance in building Western morale.
remedies, the Embassy emphasizes that French officials should take the lead
in arousing a popular consciousness of the Communist propaganda g n
provide competent public information officers to explain the real reason for
the presence of US troops and installations. 25X1
Comment:
has been `"-"Znc"reas I resentment toward TJS 1'.rnn?n
inm ;n t~no T,u .,...a
resentment is not yet knob- to?haveareacu earea in Morocco. In France, such
serious augmented by the growing French aversion to US leadership rinosuchbmatters as
the ECA productivity drive and East-West trade restrictions.
3. BELGIUM. Increased coal production would be vital defense contribution:
The ECA Mission in brussels comments that, although t e major solution to
the West European coal shortage rests with the UK and West Germany, Belgium
could assist by increasing its coal production from approximately 30 to 34 or
35 million tons annually for'the next year or so. At the same time, it could
reduce present high production costs, and thus make lower prices possible.
This would be an important single contribution to increased defense roduct'o
Counterpart funds could be used to stimulate the program and the expenditure ~
"should be considered as for defense purposes." Investment in the coal
industry would also strengthen the whole Belgian economy, resulting in a more
efficient production of military items, decreasing dollar coal imports,
easing the shipping problem, and achieving a better competitive position 25X1
within the Schuman Plan.
Comment: The high cost of Belgian coal, utilized in a major part of
the countryts defense production, and the Belgian reluctance to deal with
the problem realistically have been under continual fire. Modernization
of the Belgian coal industry, resulting in reduced costs of defense items,
could also eliminate some of the major criticism that Belgium is not pulling
its weight in the total defense effort.
Belgium seeks su nort for claims on German
Office feels that, in view of the "present PsychologicalhclimateainFGerm ny,"
a "slight push from US authorities" would be useful in obtaining about
14,000 uninhabited acres northeast of Elsenborn to be used to expand the
present and only tank firing range in Belgium. Also, it is planned to
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6.
25X6
establish a training school for the Benelux countries and Denmark there.
In return, Belgium offered to relinquish all other territorial claims,
except for the Vesdre River watershed. The Belgian Foreign Office is not
enthusiastic about the German proposal that the area be "Europeanized."
Comment: I Belgium will remain adamant
against re lnquishing its border claims on Germany unless the Elsenborn area
is offered in return. The Belgians have been informed orally, however, that
the US has no wish to enter into the Belgian-German frontier negotiations.
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Comment: Sweden's traditional Russophobia is poorly concealed by its
official neutrality. -Greater security consciousness and measures are highly
desirable.
security-conscious.
7. SWEEN. Soviet-Swedish relations deteriorating: The US Embassy at Stockholm
reports that Soviet-Swedish relations are slowly but steadily worsening. A
Soviet naval attache employee has been expelled for espionage, and the
Swedish press has reacted strongly against the diplomatic privileges accorded
Soviet representatives. Each of the countries has intensified press and
radio attacks on the other. As a result, Sweden is becoming increasingly
8. MEXICO. Government regulates the export of copper and mercury: On 6 October,
the Mexican Government assumed control over the export of copper and mercury.
According to a decree appearing in the official bulletin, these products
cannot be exported in the future without permission from the Department of
Comment:. Although producers and exporters have, in general, cooperated
with the US to prevent the export of strategic materials to Communist
countries, some Mexican copper and mercury has apparently reached the Soviet
Orbit. This new decree will help to prevent such shipments.
Economy.
9, ARGENTINA. Inter-American Press Association to discuss La Prensa case:
.e Under-Secretary of the Uruguayan Foreign O ice has informed the US
Embassy in Montevideo that his government is "nervous" concerning the meeting
of the Inter-American Press Association, because it fears the meeting will
concentrate heavily on Argentina's infringement on freedom of the press.
The association opened its five-day meeting in Montevideo on 8 October. The
Uruguayan official stated that his government, in line with its current
policy of "not rocking the boat" in relations with Argentina had done eve
thing possible to disassociate itself from the conference 25X1
Comment: Over 300 newspapers and publications are expected to be
represented at the meeting of this non-government association. This is the
associationts first opportunity to make a public airing of the case of
La Prensa, which the Argentine Government expropriated earlier this year.
Representatives of the government-dominated Argentine newspapers can
be expected to make every effort, including bribery, to persuade individual
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'1~ 141W
newsmen to echo the Argentine theses regarding non-intervention in the domestic
affairs of a sovereign nation and regarding its recovery of "justici.ali_st"
press freedom from the hands of capitalist-interests, represented in Argentina
by La Prensa, The timing of the meeting is unfortunate, because the Argentine
Government will use the inevitable denunciation of Argentine press censorship
as pre-electoral propaganda to "prove" that the US is trying to influence
the Argentine elections.
10, CHILE. Recent report of uranium deposits exaggerated: The US Embassy in
Santiago 5 ales hat the recent press announcements of the discovery of
uranium in Chile are merely the outcome of an exploratory survey made many
months ago by two US Atomic Energy Commission geologists. The geologists'
report was hardly sensational, The Embassy states that the "timing of the 25X1
overly optimistic press statement seems chiefly to distract public attention"
andnthatcthe~"Foreign~Office'.is known to have mislaid the report which was
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I I - `W w4W
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9 October 1951
CIA No. 49368-A
Copy No.
43
SUPPLEMENT
TO THE DAILY DIGEST
Not for dissemination outside O/CI and O/NE..
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This summary of significant reports has been prepared primarily
for the internal use of the Office of Current Intelligence. It does
not represent a complete coverage of all current reports in CIA
or in the Office of Current Intelligence. Comments represent the
immediate views of the Office of Current Intelligence.
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SECTION 1 (SOVIET)
1. YUGOSLAVIA. Yugoslav Government reportedly considers early settlement
of Trieste issue likely: An AP correspondent in Belgrade has informed
Ambassador Allen that his recent press story regarding a Trieste settle-
ment was based on a Yugoslav press officer's statement that the Trieste
issue had been "settled" by a decision of the three Western powers to
divide the Free Territory on the basis of the status quo, On the basis
of his contacts, the AP correspondent is convinced that the Trieste issue
will be settled by late November. Ambassador Allen comments that the
correspondent does have good contacts and is "usually a cautious reporter."
However, Allen knows of no basis for thinking that the Yugoslav Government
might be prepared to yield more of Zone B than Capodistria. 25X1
Comment: There is no evidence to support the AP man's belief that
the Yugo- slavs anticipate an early settlement of the Trieste issue, Since
the postponement of elections in early September, the Yugoslav Government's
attitude towards a compromise settlement with Italy has stiffened and
neither government has made a bona fide effort to initiate discussions.
SECTION 2 (EASTERN)
2. BURMA. Nehru opposes Burmese appeal to UN: Although Nehru recently told
Burmese Prime Minister Thakin Nu that India would support Burma if it
appealed to the UN regarding Chinese Nationalist troops in Burma, he
ar ued that such an a eal would be unwise.
Nehru told Thakin Nu he believed that the US and UK were taking all
practical steps to settle the issue. Nehru said further that an appeal
would only reflect unfavorably on Burma and might encourage the Chinese
Communists to take strong measures in northern Burma.
Comment: Nehru is highly regarded by Burmese officials and his
advice probably will be instrumental in the formulation of Burmese policy
in this matter. Following closely on the US-UK diplomatic efforts to fore-
stall action in the UN, this advice will strengthen the position of those
elements in the Burmese Government opposed to raising the issue.
3. KOREA. ROK to seek membership in UN again: According to the US senior
delegate to the UN, the ROK observer there, Ben Limb, has received in-
structions from President Rhee to renew efforts to obtain ROK membership.
Limb declared that the ROK's case should be considered concurrently with
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4.
SECTION 3 (WESTERN)
National Assembly session opening 6 November shedexpectsetohhavenatc mfort-
able majority for ratification of the Schuman Plan and for approval of the
government's policy on the prospective European Defense Forces. Both Pleven
and Vice-Premier Bidault, who recently expressed similar confidence to
Ambassador Bruce, assume that the Gaullists as well as the Communists will
vote solidly against a European Ar
Comment: While this is the first reliable indication of the probable
Assembly alignment on the Schuman Plan, intermittent reports have warned
that it would meet serious opposition when submitted for ratification.
TOP SECRET
those of Japan and Italy. US observers at the UN, noting that proper
timing is paramount in this case, believe that raising the issue now
could be "ver thorn " and would face an "almost certain Soviet veto.."
AUSTRIA. French Foreign Office doubtful of tactical merits of abbreviated
treaty Plan., The US Embassy in Paris reports that the French Foreign of-
fice is pessimistic in its estimate of the probable psychological conse-
quences to be anticipated from the introduction of the US-proposed abbrev-
iated Austrian treaty draft. While agreeing that there are intrinsic merits
in the abbreviated treaty proposal, the French suggest that the shortened
treaty will be regarded as evidence of a lessened interest on the part of
the West in an Austrian settlement -- an impression which the Austrians are
likely to share; that the new treaty may introduce a "prestige factor"
militating against an Austrian settlement; and that pressure on the Soviet
Union to achieve an agreement will not be materially increased. The US 25X1
Embassy believes that the French attitude will not be changed by a favorable
response from the Austrian Government, and it suggests that the French and
British Dositi nn4 nn +1 ,----- ' -
5.. FRANCE, Premier predicts Assembly approval of Schuman Plan and European
French Premier Pleven has told US
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m