DAILY DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000600230001-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 22
• Document Creation Date: December 9, 2016
• Document Release Date: April 18, 2001
• Sequence Number: 1
• Publication Date: December 26, 1951
• Content Type: REPORT

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TOP-SECRET
SECURITY INFORMATION
26 December 1951
CIA No. 49478
Copy No.
DAILY DIGEST
*ARMY Declass/Release Instructions On File*
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
145
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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SECURITY INFORMATION
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SECTION 1 (SOVIET)
USSR, Trade Union Plenum criticizes Soviet railway operations*- The
Seventh Trade Union Plenum convoked recently in Moscow sharply berated
two of its prominent speakers, Minister of Rail Transport Beshchev and
Rail Trade Union Central Committee Chairman Cherednichenko, for glossing
over shortcomings.
While emphasizing the housing lag,, the apparent real concern of
the Plenum was directed at deficient rail operations, possibly centered
on vital links serving the Transsiberian railway. Veiled references
to accidents on the Gorky and Ufa sectors disclosed the fact that re-
sponsible officials have recently been either penalized or tried in
court.
The Embassy is of the opinion that the Plenum in effect warned top
railroad administration and labor chiefs to get results, or expect
further and more drastic penalties. (S Moscow Weeka 50, 14 Dec 51)
Comments These warnings recall similar criticism levelled at the
railways last summer and imply that the anticipated improvement in
railway operation has not been realized.
2. Turkmen and Tadzhik cotton deliveries on schedules The Tadzhik
and Turkmen Republics announced fulfillment of their cotton delivery
plans on 17 and lg December, respectively. Tadzhik deliveries were
said to be 40,000 tons greater than at the same date last year, while
Turkmen deliveries were reported in excess of 1950 by some 32,000 tons.
(C Moscow 1074, 22 Dec 51)
Comments Embassy Moscow believes that, considering their present
delivery rate, the Soviets may be able to announce plan fulfillment by
10 January 1952. This situation is in contrast to that obtaining in
in Uzbekistan, where the cotton harvest was said to have been delayed
by faulty work organization and non-payment of earnings due the harvest
workers.
3. BU--.A? Joint Soviet-Satellite maneuv reportedly planned for
25X1C January.- combined winter maneuvers
of the the So , ran it orce, and Rumanian Army are scheduled
to take place early in January, 1952. Plans for these maneuvers are
said to have been drafted by Bulgaria, Rumania, and Soviet staff officers
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at a meetin he Stalin (Varna) during November. 25X1A
Comments So far as is known, no large-scale inter-Satellite or
Soviet-Satellite military maneuvers have heretofore been held.
CZECHOSLOVAKIA. Seventh Army reports that missing American soldier
knowingly entered Czechoslovakia; US Seventh Army headquarters states
that it can be "reasonably assumed" that Private Charles X. Wood of
the American constabulary knowingly entered Czechoslovakia on 12 De-
cember. Tracks presumably made by Wood led across the border past
clearly defined border markers to a farmhouse, where other tracks
joined them. Members of a Czech border-patrol allegedly claimed that
an American soldier was taken into custody about noon on 12 December
and was being sent to Prague. (S Heidelberg 60, 22 Dec 51)
Comment. On 15 December the US Embassy in Prague asked the
Czechoslovak Foreign Ministry to find out whether Private Wood is in
Czech custody.
5. CZECHOSLOVAKIA-HUNGAR%. New reports suggest possibility of earl cur-
rency reform in Czechoslovakian A -Czech source has reported to the
US Embassy in Prague that a rumored monetary reform may take place in
the near future. The source added that Hungary is printing new Czech
currency and that the Czech Finance Secretary is working overtime.
Hungarian currency printers and other printers have been confined to
their plants since 19 December, according to persistent unconfirmed
reports reaching the US and British Legations in Budapest. (C USARMA
Prague 723, 18 Dec 51; C Budapest 443, 22 Dec 51)
Comments There is more likelihood of a currency reform in Czecho-
slovakia than in Hungary, on the basis of present evidence. In the
last few months there have been persistent rumors of an impending Czech
monetary reform to liquidate excess purchasing power by a new banknote
issue or to place the Czech crown on a ruble basis. Excess purchasing
power has been built up in both countries by a lack of consumer goods
caused by concentration on heavy industry. Both countries have at-
tempted to meet the problem of increasing money supply by considerably
raising free market prices and increasing production norms.
6. POLAND. Large number of cranes observed moving eastward through Poland.,
The US Military Attache in Warsaw reports that on 20 December an east-
bound Soviet train with three passenger and an unknown number of flat
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7.
cars was seen at Rembertow/Warsaw. The flat cars were loaded with 51
cranes mounted on Gaz truck chassis. One of the passenger cars had a
tank, a red star, and the number 4 painted on the side. All of the
equipment appeared to be used. (S Warsaw, MAT 224-51, 21 Dec 51)
Comments The Gaz truck is similar to the US 22 ton truck. Cranes
mounted on such trucks could be used as wreckers or for the loading
and hoisting of heavy ammunition such as bombs. It is not clear from
this report whether or not the train would move on through Poland to
the USSR,. or would unload at some point in Poland.
YUGOSLAVIA. Purge of peasant members in the Croatian Communist Party
reported:, An official report submitted by the Croatian Politburo re-
veals that 881 members and 526 candidate members of the Party on the
Croatian collective farms have been expelled since last spring for
"developing the mentality of independent peasants."
The report admitted that the party had failed to capture the
imagination and the loyalty of the collective farmers during the
critical period, but had won the struggle to preserve the collective
farms. (U NY Limes, 21 Dec 51)
Commente Local party members and leaders are generally vulnerable
to popular pressures from below as well as to charges of deviationism
when peasants become "uncooperative with the regime." Thus, regardless
of their attitude, they make ideal "scapegoats."
This revelation of "disloyalty" on the part of party members on
collective farms may be intended as a warning to local party members,
reflecting party anticipation of increasing "trouble in the country-
side" this spring.
8. Yugoslavia refuses to support revision of the Italian peace
treaty. The Yugoslav Government has given a negative reply to the
Italian note requesting a revision of the Italian peace treaty. The
reply, which was conciliatory in tone, stated that although Yugoslavia
appreciates the fact that most of the peace treaty clauses no longer
correspond to present conditions, certain important issues remain out-
standing between the two countries and, for this reason, Yugoslavia
feels obliged to "'adjpurn" consideration of the revision for the moment.
(R Belgrade 824, 21 Dec 51)
Commento Foreshadowing this rejection was a recent statement by
Edvard Kardelj, Yugoslavia's Foreign Minister, to the effect that a
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revision of the Italian peace treaty was unthinkable to the Yugoslavs
without a previous solution of controversial questions, namely the
Trieste problem, between the two countries, and without the creation
of an atmosphere of "mutual peace-loving confidence."
The timing of the Yugoslav refusal, however, may further prejudice
the success of current Yugoslav-Italian talks on Trieste.
Yugoslav political interests conflict with military requirements:
Ambassador Allen in Belgrade comments that in the event of a war, the
Yugoslav Government is concerned lest Allied forces occupy Albanian
territory and determine the political future of the country.
In his conversation with Ambassador A11en, General Popovic remarked
that iii the event of a war political as well as military considerations
might be involved in any action against Albania. He did not elucidate
upon this remark, but mentioned that the Yugoslav Army could take care
of Albanian land forces with ease.
Previously Marshal Tito, in answer to a question by Admiral Gardner
as to what type of naval assistance he would require, had pointed out
that the most useful service of the Sixth Fleet would be to deny the
Adriatic Sea and Albanian ports to the enemy. (TS Belgrade 822,
20 Dec 51)
Comments Popovic's remarks reflect the continued interest of the
Yugoslav Government in establishing a dominant position in Albania in
the event of war.
10.. Tito attacks Western critics who question capabilities of Yugo-
slav Army: Marshal Tito, in a two-hour speech celebrating the forma-
tion of the Yugoslav Army, criticized Western observers "who speak of
the Yugoslav army as a primitive unit capable of fighting only guer-
rilla warfare in the Bosnian mountains." The Marshal refuted this
"absurdity!' by citing World War II partisan operations which, he
claimed, engaged 580,000 Axis troops.
The Marshal attacked "those in the West who for several reasons
do not want the Yugoslavs to receive heavy armaments. Rather, in the
event of war, they would have us bleed in the mountains as we did in
the early years of the past war, perhaps this time for some other in-
terests, as a weak, unarmed mass which at the decisive moment would
be incapable of preserving its freedom, independence, and its socialist
reality." (U FBIS Ticker, 21 Dec 51)
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Comment: Fears that Yugoslavia may not get its "deserved share"
of heavy armaments, as a result of "Western misconceptions" regarding
the ability and role of the Yugoslav army, undoubtedly contribute to
the sensitivity of the regime to criticism of its army and its proper
wartime role.
In addition, and perhaps of greater importance, is the deep-seated
distrust among Yugoslav Communists of Western political objectives in
the Balkans in the event of a major war.
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SECTION 2 (EASTERN)
EGYPT. Government reaffirms its unyielding attitud The Egyptian Govern-
ment, will refuse to consider any British 25X1C
proposal unless Britain first recogn zea Egypt?s full rights in the Sudan
and agrees to evacuate the Suez immediately.
the Egyptian Govern-
ment intends to Make it a criminal offense or any resident', including
foreigners', to help the "occupying troops."
The Prime Minister was officially informed that the Palace will not
object t? any project proposed by the government. The Foreign Minister
has told the Prime Minister that in the event of a showdown Egypt could
rely on the USSR. 25X1A
Cowmen s It appears that the Egyptian Government, spurred on by
the anti-Western Foreign Minister, is now promoting a local stiffening
of attitude, despite the desire of some officials, including the King,
for a negotiated settlement.
The projected law is so drawn as to apply to any laborers the British
bring in to counter the Egyptian labor boycott of the canal zone. Two
Egyptian employees of the British Embassy have recently been beaten by
-thugs and then jailed on charges of "insulting the government." The
government meanwhile has returned all the property and funds of the
extremist Moslem Brotherhood following a three year seizure.
2. LEBANON. Fear of revival of forgpn sphQres of influence in Near East:
A Lebanese parliamentary leader has expressed his concern over reports
that the British and French have reached an agreement to end their rivalry
in the Near East. He believes that many Lebanese.will regard this as a
step toward the reestablishment of foreign ages of influence.
The US Minister in Beirut comments that one of the greatest Lebanese
fears is the possible revival of a French sphere of influence. He warns
that while "large power cooperation in the Near East is essential," the
US must be "very careful not to be jockeyed into the position of appearing
in the eyes of.people of the Near East to support colonialism or spheres
of influence." (S Beirut 616, 19 Dec 51)
Comm s Fears of foreign spheres of influence were voiced in late
November by the Syrian Chief of Staff, who saw the Middle East Command
proposals as a possible vehicle for a revival of French supremacy in
Syria. More recently it was rumored that he executed his recent coup
in Syria with French support.
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3. .AFGHANISTAN, Troop movements to avert possible tribal clashs The murder
in Kabul of a Jaji tribesman and his son, reportedly by a chieftain of a
Pushtu tribe, has caused the Jaji tribe to threaten to take the law into
its own hands in revenge. The Prime Minister of Afghanistan, who has
great prestige with the tribes, has persuaded the Jajis not to act for a
few days. In the meantime, it is reliably reported that 4800 Afghan
troops were moved on 16 December to Gardez, near the Jaji tribal area,
about 75 miles south of Kabul. (C Kabul 294, 18 Dec 51)
Commenn -. The importance of the tribes in the relatively primitive
society of Afghanistan makes tribal disputes and blood vengeance disturb-
ing to the stability of the country. The situation presumably can be
controlled by the Afghan Army, which has demonstrated its ability to deal
with regional disorders in the past.
INDONESIA. Chinese-Inonesian trade negotiatians no lamer n
_ progress1.
When questioned by US Ambassador Cochran on the possibility of a trade
agreement with Communist China, Foreign Minister Subardjo stated that no
trade negotiations are in progresso He said the original Chinese approach
was dropped last June after Indonesia. adhered to the UN embargo on tin
and rubber. (C-Djakarta 899, 21 Dec 51)
ommen ;.. There have been repeated indications of illegal shipments
of rubber from Indonesia to Communist China via Macao. Some of these
transactions may have involved the cooperation of individual Indonesian
officials, thereby inspiring rumors of a secret agreement or a prospective
agreement with Communist China.
5. Government seizes mil r ui ent on second D tch ships The
Indonesian Government has issued instructions to Djakarta port authorities
to proceed with the seizure of military equipment on a Dutch ship which
entered port on 18 December, refusing to accept the Netherlands explana-
tion that this was a routine shipment for renewing ordinary supplies and
equipment in West New Guinea. (S Djakarta 886, 20 Dec 51)
Comment: Military police removed an arms shipment destined for West
New Guinea from a Netherlands merchant vessel on 9 December. A semi-of-
ficial news agency reported that the government based its action primarily
upon a 1949 Indonesian ordinance which specifically prohibits transporta-
tion of arms to any part of Indonesia without a permit. Indonesia consi-
ders West New Guinea part of its territory and therefore governed by the
terms of this ordinance.
Indonesia's seizure of the arms shipments and its justification
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thereof represent the first official effort to implement its claim to New
Guinea. However, although Indonesian action has imposed an added strain
on Dutch-Indonesian relations, there is little likelihood that these
incidents in themselves will endanger current informal talks on New Guinea
and the Round Table Conference agreements being conducted by the' two
governments in The Hague.
6. Police ar=tN No th Sumatra Communisj lead=-Q On 14 December police
arrested Sidartoio, head of the Indonesian Communist Party in North Sumatra.
Comments Sidartojo apparently was designated to lead the party in
.North Sumatra after the arrest of Adjitorup, the Commissar for North
Sumatra, last August. Since the government security sweep at that time,
Sidartojo and other Communist leaders have been in hiding.
7. THAILAND. Early rebellion predic ecs A "shooting revolt" directed a ainst
the military cli ue led by Generals Phao and Phin is predicted 25X1C
25X1C The action "may be expected in the near fu ure 25X1C
25X1 C
25X1 C Meanwhile
25X1 C
before 31 December. ighting is anticipated when the coup occurs."
Commen : Royalists, followers of former Premier Pridi, recently
ousted civilian leaders, and various elements of the armed forces are
strongly opposed to the present ruling clique. It is not possible to
identify which`of these factions or combinations thereof are plotting an
early coup. The present government commands sufficient armed strength to
suppress any revolt against it if none of the factions comprising it
defects.
8. INDOCHINA. Chinese invasion of It}dochi?a held un it kelvs The British
Defense Coordinating Committee. for the Far East concluded on 14 December
that the Chinese Communist forces on the Indochinese border had been
considerably strengthened. The Committee decided, however, that overt
intervention by the Chinese in Indochina was unlikely in the near future.
(S Singapore 692, 21 Dec 51)
French suffer prestige Loss in Catholic area. Recent events have
caused Franco-Vietnamese forces to lose "much face" in the heavily Cath-
olic Phat Diem area and it is "very, dangerous" there,- according to a
25X1A
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Vietnamese bishop from that locality. He further stated that when the
Franco-Vietnamese forces reentered the town they subjected the inhabitants
to many indignities and that anti-French feeling was running high. (S
Hanoi 406, 22 Dec 51)
Comme The French have been extremely reticent concerning action
at Phat Diem which is located near the southern apex of the Tonkin peri-
25X1C meter, the Viet Minh in mid-December,
with the apparen complicity of the population, thoroughly infiltrated
the town, surprised the defending forces, and captured sizeable quantities
of arms before withdrawing.
10. Chinese Communists again ren rted reparin to invade Indochina:
25X1C report variously that Chinese Communist
forces near the Indochina border are:
(1) awaiting orders to enter Indochina,
(2) being organized into a "volunteer" force of 250,000 troops
for an invasion of Indochina, and
(3) scheduled to invade-Indochina as well as Burma in the spring
of 1952.
C en a Several recent reports have forecast a Chinese Communist
invasion of Indochina--as a "volunteer" force or in Viet Minh uniforms--
in the period from late December 1951 to spring 1952. Similar reports
from similar sources in the past 18 months have been repeatedly disproved
by events. Recent reports of a great augmentation of Chinese Communist
forces in the area remain unconfirmed. There is good evidence of increas-
ing material aid to the Viet Minh from China, but no strong indication
of an imminent Chinese Communist invasion,
11. BURMA. ChinesfConist force,.-,on Burma border reportedly strengthened.
25X1C Chinese Communist forces on the
25X1A possibly in pre aration for "the invasion of Southeast Asia."'
Comm n s There is no evidence of a significant reinforcement of
Chinese Communist troops near the Burma. border since the end of the
monsoon season in September. Since summer 1951 Chinese Communist forces
in the area have remained at a strength of 30,000 to 40,000, constituting
a substantial striking force for a possible operation in Burma.
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12. CHINA. R"i road construction in northwest accelerated., According to
Peiping radio, the deadline for completion of the railroad from Tienshui
to Lanchou in China's Northwest District was advanced from June 1953
to the end of 1952. (R FBIS Peiping NCNA, 18 Dec 51)
Comment: Construction of this 230-mile railroad, begun in 1950,
has been delayed by.a shortage of steel rails, diversion of laborers
to the Korean war, and mountainous terrain. The Communists claim that
trains are now operating to a point about 40 miles west of Tienshui.
It is doubtful, however, that regular service is maintained west of
Sian, about 200 miles east of Tienshui
service east of Tienshui
was irregular and that landslides and tunnel cave-ins were common.
These observers did not board a train until they reached Sian.
13. KOREA. CINCFEaccepts three CCF rocket launcher regiments in Korea.
In view of corroborative evidence, Far East Command now accepts the
presence in Korea of at least three CCF rocket launcher, "Katyusha,"
regiments of unknown subordination.
One recent CCF officer prisoner claimed first hand knowledge of
a CCF "Katyusha" division consisting of two Katyusha regiments and
two anti-aircraft regiments. The prisoner reported that.a Katyusha
regiment consists of two firing battalions of twelve 132mm rocket
launchers each. (S CINCFE Telecon 5481, 22 Dec 51)
Commen: The presence of these Soviet-developed weapons should
augment considerably the overall strength of Communist artillery in
Korea. ?
14. Two North Korean VI Corps divisions may be inactivates. Far East
Command reports that the. 18th and 19th Divisions of the North Korean
VI Corps have been inactivated and their respective personnel have been
allocated to the North Korean II and III Corps. Recently captured
prisoners from the II and III Corps, claiming to be former members of
VI Corps units, state that the-18th Division of 7,541 men was allocated
to the II Corps and the 19th Division with 4,782 men went to the III
Corps. (S CINCFE Telecon 5481, 22 Dec 51)
mment::This report lends additional credence to previous
reports of the deactivation of the North Korean VI Corps (Daily Digest,
20 Dec 51, Item 2) and to previous indications of the North Korean
Army's inability to maintain the flow of replacements.
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154 Peng Te-huai allezedl-v r"orts_on Korean war:
25X1C eng e- ,
the Chinese Communist Volunteer omman er- n e , advised the
"Chinese Communist Central Government" that
a. Communist propaganda had succeeded in lowering the morale
of UN troops,
by 5 December two-thirds of the "foreign Communist troops in
Korea" were evacuated and their place taken by Chinese
Communist troops, and
c. most of the South Korean guerrillas and agents in North
Korea had been wiped out.
Comment: Communist anti-morale propaganda in Korea is believed
to be relatively ineffective. It is true, however, that during the
past few months the Communists have launched an extensive anti-guerrilla
campaign with a considerable degree of success.
The reference to the "evacuation" of foreign troops is similar
to a previous report received alleging that
Soviet, Czech and Polish troops were to be evacua e o Manchuria.
While, conceivably, the considerable number of Soviet personnel
may be withdrawing to Manchuria, there is no confirmed evidence of
such a move. No Caucasian military personnel--other than Soviet--have
ever been conclusively identified in Korea.
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SECTION 3 (WESTERN)
1. GERMANY. French and British still reluctant to halt German interzonal
aadde: The French an Britis High Commissioners in Germany have suggested
is HICOM permit the West Germans certain new exports to East Germany under
the partially suspended interzonal trade pact, asserting that some trade
must be maintained as a bargaining point in influencing the USSR to halt
restrictions on West Berlin trade. The suggestion was shelved after McCloy
refused to agree to any such concessions, emphasizing that the US was alarmed
over the moderation of the Allied stand on East-West trade.
Discussing the current small air-lift in Berlin, McCloy indicated that,
after February, the US would be unwilling to help finance the air-lift, and
suggested that the Germans might have to finance it themselves. (S Berlin
845, 21 Dec 51)
Comment: The French and British desire to make certain concessions
may arise partly from the fact that Soviet harassing measures in Berlin
have been relaxed during recent weeks. Their principal harassing tactic at
present is their handling of export permits, resulting in delays harmful to
Berlin firms. Interference with parcel post shipments is continuing,
although it has been sharply reduced since early November.
2. West German ratification of Schuman Plan seen: Local US officials
feel that ratification of the Schuman Plan by the Wes German Bundestag is
now "virtually ensured by a considerable margin." Approval of the Plan by
the Foreign Affairs Committee on 13 December has.cieared the way for final
parliamentary action early next month. (R Bonn 810, 20 Dec 51)
Comment:: The action of the committee followed a rebuff to the
Chancellor from the Lower House on the issue last week. A steering com-
mittee, aroused at the Chancellorts high-handed attempts to force consider-
ation of the Plan before Christmas, voted to postpone floor debate until
after the Christmas recess. This committee vote had, according to local
US representatives, the "somewhat sheepish concurrence" of members of the
government coalition, who broke ranks after a member of Adenauer's party,
.allegedly slightly intoxicated, supported the oppositionts plan to postpone
consideration.
3. West Germans may reduce demands for equal status in arras production:
In discussing German security controls with The High Commissioner,
Chancellor Adenauer stated that he still wants all German arms production
regulated by the European Defense Community, since this arrangement precludes
discrimination against West Germany. The US High Commissioner proposed,,
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however, that the Federal Republic enact legislation prohibiting the
manufacture of atomic, biological and chemical weeapons, guided missiles,
airplanes and certain naval craft, with all other German arms production
being exclusively controlled by the European Defense Community.
Adenauer reacted favorably to this by indicating that if other Com-
munity nations persisted in rejecting his view, he would consider the proposal,
provided that German scientists be permitted to participate in atomic research
in other countries, and that the aircraft restriction be withdrawn.
The US High Commissioner feels that these two conditions are reasonable
in the light of the German political situation and that Adenauer will
negotiate on this basis. (S Bonn 801, 19 Dec 5l)
Comment: The current negotiations over German arms restriction have
bogged down on French demands for stringent controls of German arms manu-
facture. The American proposal could break this deadlock since it may offer
French negotiators enough restrictions to placate public opinion.
The French are particularly concerned about the revival of a German
heavy weapons industry. American policy makers would like to see such a
revival, with some restrictions, because they feel full use must be made of
German industry if Europe is to be adequately. rearmed. Since under this
proposal the European Defense Community would control all German arms
manufacture, that body might later work out a compromise between these two
positions.
4. West Germans want defense contribution removed from contractual
agreement: At the first meeting of the Bonn working group on the German
financial contribution to Western defense, the German representatives stated
that their contribution should be made direct to the European Defense Com-
munity budget; EDC should pay the German bill for Allied forces in Germany,:
thus obviating the need for a contractual agreement convention on this
matter; and the Bonn discussions should be transferred to the Paris.EDC
negotiations in order to avoid an unmanageable overlap.
The Allied representatives disagreed with these views, citing among
other things that the Bonn discussions deal with many facets of the problem
which the EDC meetings cannot cover. (S Bonn 829, 20 Dec 51)
Comment: The hard attitude adopted by the Germans in the early phases
of these discussions may be for bargaining purposes since Chancellor Adenauer
recently instructed that all Contractual Agreement conventions be concluded
by 15 January. The Germans are determined, howeve', to avoid making a direct
contribution to the Allied Forces since this resembles occupation costs.
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FRANCE. Communists make no attempt to defy governmental ban. The French
Communist Party made no attempt to defy the government's _an on.a mass
meeting scheduled for the eve of the National Peace Assizes 22-23 December.
(C Paris 3753, 22 Dec 51)
Comment: The strong police measures taken on 9 December to prevent
an Algerian nationalist demonstration in Paris, as well as the notably poor
showings made by Communist front organizations during the past year, may have
deterred the Communists from risking their prestige on a show of force at
this time,
6. French Government faces new crisis on Tunisian policy: The French
Government is in a precarious posi ion With regard to it-s-T-un-isian policy.
Rightist parties are attacking Foreign Minister Schuman for being too
liberal toward the Tunisian demands, while the Socialists and independent
leftists are harassing the government for not making more rapid progress
toward liberalizing the Tunisian regime. (C Paris 3718, 21'Dec 51)
Comment: Faced with such hostile extremes, the government might find
it difficult-to survive a serious incident in Tunisia.
7.
France has difficulty in selecting new Resident General for Tunisia:
French Tunisian relations are now so strained that the nominee to succeed
the present Resident General in Tunisia is unwilling to undertake the task.
Among other possible candidates, the two most obviously qualified are
Socialists, who are unlikely to accept the post because of the Socialist
objection to the Cabinet's rejection of all Tunisian demands, (C' Paris
3655, 20 Dec 51)
' Comment: The pressure on the Government from French "colonstt in Tunisia
has resulted-in the dismissal of the last two Residents General. Because
of strong opposition in France on the part of liberal groups, as well as the
three-day protest strike called by the nationalists for 21-23 December, the
government may have difficulty now in selecting a man to fill the post.
Native tension is presently so great that any untoward incident is likely
to cause a riot. Although the French maintain sufficient military and police
forces in the area to quell any disturbance, bloodshed would prolong native
hatreds.
8. ITALY. Italians favor Soviet resolution for blanket admission to United
1 "atI.ons : Italian representatives at the UN have recommended o repre-
sen a es that the best means of achieving Italian membership is to support
the Soviet resolution favoring acceptance of all applications now pending,
with the exception of Korea and Vietnam, hoping that the Soviet candidates
would fail to receive the necessary votes in the General Assembly.
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9.
US representatives stressed the fact that in the past the US has
strongly favored consideration of each applicant on its own merits, but
they declared that the Department would give the Italian suggestion "most
careful consideration," The US delegation further pointed out that the
position of the UK and France on this issue was not clear, and that the
position of nationalist China presents real difficulties in view of the
fact that opposition to admission of Outer Mongolia might cause the Chinese
to veto the whole resolution.
The Italians'-agreed not to proceed with any particular program without
prior consultation with the US. (S Paris DELGA 799, 22 Dec 51)
VATICAN. Vatican international policy objectives reported: The Vatican
reportedly fears that-defense activity in the United States will develop
into military expansionism, with politics receiving greater emphasis than
ethics. With regard to specific aspects of US policy, the Vatican reportedly
feels that the continued occupation of Japan is immoral, that the support of
the Tito regime is wrong, and that the American stand on Israel will dis-
credit Christianity.
The Vatican's policy objectives in the US are (1) to defend peace by
encouraging "defensive militarism" only and not unconditional rearmament and
by supporting "neutralists" if necessary, and (2) to conduct an anti-
Communist ideological campaign "with Christian systems, forces and principles,
Comment: The Vatican would like to see Japan strengthened sufficiently
to act as s firm anti-Communist bulwark in the Far East. Vatican publi-
cations in the recent past have criticized the United States' retention of
the Ryukyu Islands. The Holy See considers the problem of Church-State
relations in Yugoslavia unresolved and has announced that the conditions
of Archbishop Stepinac's recent release are unsatisfactory, The Vatican
continues to urge the internationalization of Jerusalem and seeks to increase
its influence among the Arab bloc.
US economic and military attempts to contain Communism are probably
supported by the Vatican. The Pope appears to be seriously concerned,
however, over the possible effects of the all-out armaments race between
the East and West.
10. NETHERLANDS. Satisfactory settlement of Dutch-Indonesian problems appears
dlff"icu t The co-chairman of the Ne er an s delegation to e utc -
In obi nesian talks at The Hague has stated that the atmosphere is less favor-
able than last week, when he considered it possible to "find a satisfactory
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basis for discussions." He told the chairman of the Indonesian delegation
that the Dutch would find it difficult to continue formal negotiations if
there are more such incidents as the seizure of arms on a Dutch ship destined
for West New Guinea and the temporary arrest of Dutch nationals and
Indonesian employees of the shipping company.
Negotiations are temporarily stalemated pending the formal Dutch reply
to the Indonesian note requesting that New Guinea also be included on the
conference's agenda. (S The Hague 619, 19 Dec 51)
Comment: Dutch-Indonesian relations are now being discussed informally
at The Hague, and negotiations are expected to be finished by the end of
January. Indonesia is insisting that it be given sovereignty over West New
Guinea, but there is yet no indication of a change in the Dutch policy to
retain interim control over the area. The Dutch will be extremely reluctant
to grant Indonesia's financial and economic demands.
11. Stikker reiterates fears concerning European Defense Forces:
Netherlands Foreign Minister S ikker has stated his continued support of
the European Defense Community concept, but fears that the conference dis-
cussions now going on tend to place NATO and the Atlantic Community concept
in the'background while bringing the continental community view more to
the foreground. He added his concern regarding Benelux cooperation in
foreign affairs should one of the partners be unwilling to be associated
with the European Defense Community. Such a development probably would lead
to Benelux. disassociation from the defense plan. (S The Hague 631, 22 Dec 51)
Comment: The Netherlands has indicated continual fears of French
domination on the continent. None of the Benelux countries is expected
to back out of the EDF conference before the end of January, however, when
the outcome of the discussions will be known.
12. LUXEMBOURG. Luxembourg indicates position on steel exports to Soviet bloc:
Luxembourg Foreign Office official has state that, b cause his country
probably will not receive any US economic or military assistance, there was
some question of the extent to which needed imports of Russian manganese
and Czech malt in exchange for Luxembourg steel should be sacrificed, He
added that failure to obtain Soviet manganese would reduce Luxembourg's
steel industry's contribution to the defense program. Furthermore, Orbit
payments are made in advance and in dollars. (S Brussels 853, 21 Dec 51)
Comment: Luxembourg is slated to receive US military assistance on
a limit' scale.
It is believed that important quantities of steel will continue to
be shipped illegally to.eastern Europe in view of the long-established
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relationship between Luxembourg producers and their steady customers in
Satellite countries. Considerable amounts of these exports are licensed
to the US and deflected to the Soviet bloc.
13. UNITED KINGDOM. British press su ports g
e eration: ommenting on t e recent "sream ofnarticles oon European a nte-
gra on in the responsible British press, the American Embassy in London
estimates that the general effect has been to confirm the governmentIs stand
Such that Britain respected cannot leaders become of an active participant in any European federation..
opinion as the London Times and the Manchester
Guardian insist that closer unity of the democracies must be in terms of the
whole North Atlantic community rather` than of Europe alone; and the Observer
is the only important newspaper which thinks.that Britaints position an he
Atlantic community would be enhanced by joining a European federation,
(R London 2792, 19 Dec 51)
Comment: On the related but much narrower
contri'"c~u on to the European Defense I+'orce, there istsomeoevidencelihatr?op
u
public opinion may be tending toward a slightly more favorable position.
Several weeks ago a Manchester Guardian editorial advocated a token troop
contribution, and the Br1 isi Ga up Po 1 last week announced that 46 percent
of those polled favor British participation in a European Army under terms
which are not quite clear in the reports presently available. British
opinion has, however, consistently emphasized the distinction between
functional cooperation and constitutional ties with the continental nations.
l), DOMINICAN REPUBLIC, Three Guatemalan members of Quetzal crew
ree Guatemalan members of he Quetz crew see OC dairy arts u
29 Nov 51, and 11 Dec 51) have been reed b a I Digests ~ Aug g 51,
Trujillo and delivered to the Ur y pardon decree of President
uguayan Guatemala r Charge, who will accompany them to
(U Ciudad Trujillo 123, , 23 23 Dec 51)
Comment: The Guatemalan Government had been waiting for the liberation
of her seamen by Trujillo on 23 December the next liberation
with the promise made to the mediating Government of ~tuuay, The accordance
two
Dominicans in the crew, Captain Alfredo Brito and his cousin ~Alcides Brito,
were acquitted on 12 December following the appeal of the case,
There was speculation that the Dominican Republic might resolve the
entire affair with a Christmas gesture by also releasing the five Cuban
seamen, It is believed that if Trujillo sets the Cubans free, whether
under pardon or amnesty release Cuba
Should the pardon not be applied ' will probably consider the case closed.
houl Gterpardt to the Cubans, it is reported that the
C plans to break relations with the Dominican Republic, since
it feels that no other recourse has been left to it from the standpoint of
national dignity and necessity to placate popular feeling.
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SECURITY INFORMATION
26 December 1951
CIA No. 49478-A
Copy No.
4 5
S/S CABLE 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 2 (EA.STERN)
1. CHINA. Imprisoned Americans reportedly moved to Peiping: A diplomatic
official W-53 recently e t Peiping reports that "about 29" Americans
who have been imprisoned in Communist China were-recently-moved to
Peiping. The source believes that this transfer may lead to the release
or deportation of these Americans, possibly as a result of recent
representations made on their behalf by foreign diplomats in Peiping.
(S S/S Hong Kong 1975, 20 Dec 51)
Comment: Although the source claims that this development is a matter
of "genera knowledge" to the diplomatic corps in Peiping, this report is
unconfirmed. There has been no evidence to date that the representations
of foreign diplomats have induced Peiping to release imprisoned Americans or
even to mitigate its treatment of them. The prospect for all foreigners
imprisoned in China remains bleak.
2. EGYPT. King anxious to remove present government: King Farouk has become
progressively more angry with the 56d party and the way in which it has
consistently outmaneuvered him since the abrogation of the Anglo-Egyptian
treaty. He is determined to remove the present government as soon as an
occasion presents itself on which he can act without arousing popular
opinion against the crown.
As a prerequisite to such action, however, Farouk requires indications
from the British that they would be ready to settle with a successor along
lines sufficiently acceptable to the Egyptian people to make such a
government's position tenable. (S S/S Cairo 904, 18 Dec 51)
Comment: The British Government has instructed its Ambassador in
Cairo to urge Farouk to install a new government but has not offered any
new proposals for a settlement. There seems to be little likelihood that
the British will accept the conditions required for action by Farouk. The
return of the Egyptian Foreign Minister from the UN sessions in Paris will
again give greater support to the extremists and make it more difficult for
elements interested in a negotiated settlement to achieve a compromise.
SECTION.3 (WESTERN)
3. FRANCE. French maintain basic position on security controls: Although the
French have made certain concessions, they continue to insist that security
controls over German armament production be handled by contractual arrange-
ment with Bonn rather than through the European Defense Community. The
French spokesman at the three-power security controls talks in Paris claims
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that Foreign Minister Schumangs position before the National Assembly will
be "precarious" and approval of the Defense Community treaty very doubtful
if the French Government cannot give assurance that the Germans will be
bound by safeguards outside the treaty. The US Embassy in Paris believes
that the French intend no further concessions and that their preoccupation
with their parliamentary situation is "by no means unwarranted or
exaggerated."
If, at the 27 December meeting of the, foreign ministers of the
European Defense Community, Schuman cannot persuade Adenauer to accept a
contractual arrangement, the UK representative at the security control talks
will suggest to his government that the High Commissioners exert pressure
on Adenauer to accept SchumanQs proposal. (S S/S Paris 3751, 22 Dee 51)
Comments Since all members of the European Defense Community will
enjoy equa status, the French believe that security controls must be im-
posed on Germany before it is admitted to the organization.
Last spring the Germans indicated that they would accept whatever arms
production limitations the French proposed. In view of the short time re-
maining before the Lisbon NATO meeting, it is possible that Adenauer will
accede on this point, although his parliamentary situation is almost as
difficult as Schuman u s s
UNITED KINGDOM. British providing new labor supply for Suez base: The
British War Office considers the labor sizppy the chi.e di t i y in keep-
ing the Suez base operative. The War Office is dubious as to the success
of the current approach to Italy in an attempt to recruit 11,000 semi-
skilled workers, but is willing to -try anything to escape the expensive
alternative of sending British labor to the canal zone. Plans to bring in
4,OOO to 5,000 semiskilled Miltese9 Cypriots, and other British subjects
by May are already being implemented.
The War Office expects that the unskilled labor requirement will be
filled before May with workers drawn mainly from the British African
colonies and Mauritius o (TS S/S London 2790, 18 Dee 51)
Comments In proceeding with these plans, the British government is
' follows"g e War Office judgment that the Suez base can be kept operative,
despite the contrary opinion of the British Embassy in Ca_aro, The War
Office has apparently abandoned an earlier estimate that the Egyptian
laborers would soon return.
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