Current Trends in Sino-Soviet Bloc Construction and Procurement of Merchant and Fishing Vessels

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01149A000500190002-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 21
• Document Creation Date: November 9, 2016
• Document Release Date: July 20, 1998
• Sequence Number: 2
• Publication Date: April 1, 1957
• Content Type: MF

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Central No.01848
1 April 1957
MEMORkNDUM FOR: Economic Defense Intelligence Committee
FROM : Chairman, EDIC
SUBJECT Current Trends in Sino-Soviet Bloc Construction
and Procurement of Merchant and Fishing Vessels,
REFERENCE EDIC/M-200 1 February 1957
1. In response to a request from ICA/MDAC dated 18 January 1957,
the attached study has been prepared by an ad. hec Working Group
comprised of CIA, State/OIR0 and Navy/ONI representativesc,
2. This study is circulated to EDIC members for review. If
any member has a question which would warrant discussion of the study
by the Committee, it is requested that the Executive Secretary be
contacted prior to noon, Friday, 5 April-19570 so that a meeting can
be scheduled for this purpose If no question is rased, the study
will be disseminated without further revision
Attachment:
Current Trends in Sino-Soviet Bloc Construction and Procurement
or Merchant and Fishing Vessels.
CONIIDENTIAL
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DRAFT
D FL_ & F T
CURRENT TRENDS IN SINO-SOVIET BLOC
CONSTRUCTION MND PROCUREMENT OF
MERCHANT AND FISHING VESSELS
EDTC/ID-30
1 April 1957
An Intelligence Summary
Prepared by an Ad Hoc Slib-Committee
a the Sconcado Defence Intelligence Committe!)
at the Request of the Executive Committee Of the
Economic Defense Advisory Committee
WWI ..,*1011.wilift:-,
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Table of Contents
Introduction 00000 e? 0060000000
Recapitulation of COCOM/CHINCOM Shipping
Negotiations and Controls Currently in Effect .
Present Composition of the Sino-Soviet Bloc
Merchant Fleets . . . 000??
Soviet Bloc Capabilities for the
of Merchant Ships . .
?10
Construction
O 0 0 0
? 0. 0
Free-World Ship Construction for the Sino-Soviet
Bloc ? . 0 0 S 0 ? 0 0 5 0 ? ? ? 0 0 0 0 0 0 0
V10 SUMMarY00000000 00000 0 000 0 0 0 0
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NEWITIA
Composition of Sino -Soviet Bloc Merchant Fleet4
as of 1 January 19'I ,
00.400040000 L.
Comparison of Sinc-Seviet Bloc and World Merchant
Fleets, by Type of Ships .
4.000 4000
Comparison of Sino-Soviet Bloc and World Merchant
Fleets, Percentage Distribution by Age
Comparison of Sino-Soviet Bloc and World Merchant
Fleets, Percentage Distributlon by Speed ,
Sino-Soviet Bloc Naval Auxiliaries Capable of Being
Used for the Carriage of Passengers and/or Carv:
6 European Soviet Bloc: Estimated Planned Increment to
Cargo and Tanker Fleets, and Construction and Imports
of Cargo and Tanker Type Ships, for 1956-1960.
Comparison of Free-World Deliveries of Ueean-Golhg
Ships to the Sino-Soviet RIoa with Total Free-Worio
Deliveries of Ocean-Going Lihips 19,5 ........
Comparison of Free-World Deliveries of Ocean-Going
Ships to the Sino-Soviet Bloc with Total Free-4orio
Deliveries of Ocean-Going Ships - 195C
Deliveries of Ocean-Going Sh4s to the Sino-Soviet
Bloc 1.955 000 J i., 4000000000,0
10 Deliveries of Deean-Goini; Ships to the 5ino-Soviet
Bloc - 1954. U 0 0 0 0 00000UUV? .
It Comparison of Deliveries of Ocean-Going Ships to the
Sino-Soviet Bloc from Free-World and Sino-Soviet
B/cc Countries, by Ship Type n and Relative Percentages
of GRT Totals - 19? ,
_ftwouisierrmab
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List of Tables Cont'd1
12 Comparison of Deliveries of Ocean-Going ships to
. the Sino-Soviet Bloc from Free-World and Sino-
Soviet Bloc Countries, by Ship Types and
Relative Percentages of ORT Totals - 1956 .
13
14
15
Deliveries of Ocean-Going Ships to the Sino-Soviet
Bloc from Free-World Countries - 1955 0 . 0 06 ft 00
Deliveries of Ocean-Going Ships to the Sino-Soviet
Bloc from Free-World Countries - 1956
Deliveries of
Sino -Soviet
1955
16 Deliveries of
Sino-Soviet
1956 . .
00 0 0 00
00
Ocean-Going Merchant Ships to the
Bloc from Sino-Soviet Bloc Countries -
*0000000000000000 0000
Ocean-I-Going Merchant Ships to the
Bloc from Sino-Soviet Bloc Countries -
. 0 000 0000000000000000
17 Ocean-Going Ships under Construction for the
Sino-Soviet Bloc in Free-World Countries -
1 January 1957. . .
0000 0 0000 0
-0000 00
18 Ocean-Going Ships on Order for the Sino-Soviet
Bloc in Free-World Countries - 1 January 1957
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INTR0DUC704
The U.S. intelligence community has been requested by the EDAC
structure to assemble the necessary background information for evaluating
current controls imposed by free world countries on shipbuilding and
shipping services for the Sino -Soviet Bloc. The following paper is the
response to that request.
Certain qualifications must be made at the outset of the studye
reflecting the peculiarities of free world controls on strategic trade
with the Bloc and the adequacy of informational resources for this undere
taking in the time allowed,
The controls which are referred to in this paper are standards
eommonly agreed upon by the Participating Countries (PC's) of COCOK/CHINCOM
but enforced in their several jurisdictions in line with their own
respective national laws and regulations. In other words, detailed
enforcement of a COCOM control standard may mean the actual subjection
of a particular contract to more scrutiny by the licensing authorities
of one PC than of another. Vicariously, the standard of these COMM/CHINCOK
controls can also be applied to most other.non-PC free world countries
in the shipping field since they tend to follow the lead of the major
shipbuilding and shipping nations of the world, all of which are PCue
(see, e.g., the alignment of the regulations of Panama, Costa Rica, and
Liberia as regards ship sales and shipping services with strict U. S,
oontrols).
To Communist China, CHINCOM controls deny virtually all shipping
(see Section II "Recapitulation of COCOM/CHINCOM Shipping Negotiations
and Controls Currently in Effect). This fact should be kept in mind in
the perusal of this paper because, it provides an indication of the
limitations for Communist China as regards acquisition of shipping from
other Bloc sources and also the extent to which Communist China is
compelled to resort to the services of free world shipping for the carriage
of commodities in her trade which are not subject to free-world embargoes.
One purpose of this paper then will be the analysis of the present
size and composition of the SinoeSoviet Bloc merchant fleets and to
establish a comparison with the merchant fleets of the free worlde
Another aim of this study is to forecast for the near future likely
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trends in the growth and composition of the Sino-Soviet Bloc merchant
fleets, both from intra-Bloc construction and by projected acquisitions
from the free world? Some attention will also be given to the relative/7
small amount of shipping which the Bloc has constructed or will be
constructing for export to the free world?
Admittedly, it would be useful for officials concerned with the
formulation of shipping controls to have readily available, along with
these data, forecast of actual Sino-Soviet Bloc shipping requirements
for the carriage of goods and persons? ECE and ECAFE reports, NATO
estimates and U.S. intelligence studies have, from time to time, ,
provided guidance for the estimation of Soviet Bloc shipping requirements,
A comprehensive analysis of shipping requirements for the Sino-Soviet
Bloc ocean-borne trade, undertaken in conjunction with the present
paper, has not advanced sufficiently to be included here.
In U.S. policy, consideration of Bloc shipping capabilities is
important from the viewpoint of security. The Free World has denied to
the Bloc in recent years only warships and the most strategic types of
merchant and fishing vessels. Nevertheless, through elaborate negoti-
ations and continued surveillance of Bloc shipping capabilities-, the
Bloc has often been compelled either to pattern its planning around
Free-World controls or to attempt a breaching of these controls by
major ropaganda and diplomatic efforts? Currant efforts to revise
COC CHINCOM controls appear to have reached a stage now in Which
the shipping field may also be subjected to a new look. This study,
with the qualifications mentioned above, is intended to provide the
intelligence background for such an effort?
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RECAPITULATION OF COCOM/CHINCOM SHIPPING NEGOTIATIONS AND
CONTROLS CURRENTLY IN EFFECT
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The United States has sought since the inception of COCOM controls
en shipping to obtain a degree of control over the construction, sale and
chartering of ships to the European Soviet Bloc which would satisfy U.S,
concepts of the strategic importance of ships and shipping services to the
Soviet Blocs potential to wage war on the West-; In COCOM the United
States has taken the position that all ships are potential weapons of war
and should not be supplied to the Bloc, Other COCOM countries are of the
opinion that the strategic importance of ships is a matter of degree and
that the less strategic types of ships should not be controlled to the
Bloc except on a quantitative basis, or should be free of COCOM controls?
As a consequence of the difference in assessments of strategic importance
between the United States and other COCOM member countries, the division
of various categories of ships between Lists I, II and III represents a
series of compromises among the COCOM countries. In the negotiation of
the control lists the United States has had to accept same security
risk in respect to overall control on vessels in order to resell agreement
with tho other Participating Countries. For example, the U.S., was forced
to accept the principle of quantitative control on merchant vessels when
other COCOM members insisted that they must be permitted to sell merchant
ships to the European Soviet Bloc countries in order to maintain their
shipbuilding industries or to trade for needed materials from the USSR and
the Satellites,
Lespite the conflicts in COCOM on the strategic importance of various
other categories of ships, the shipping items on the present List I (Embargo)
were carefully defined is various bilateral, trilateral, and COCOM plenary
diszumoions in the Winter of 1953 and Spring of 1954,, These vessels are
tonsidered directly useful in support of a war effort? In addition .to
warships, other ships of a isipe which could most readily support military
operations Iseo tankers, passenger ships, and ships suitable for naval
auxiliaries are not to be constructed for or sold to European Bloc
countries.. Although the coverage of the most strategic types of ships
under List I is good, the U0 S0 would have also embargoed certain types
of dredges andmerchant vessel of more than 7,000 GRT independent of
speed, or having an operating speed leaded of more than /2 knots. In the
most recent negotiations (1955) the USO sought embargo listing of
merchant .ships having a speed of 15,5 knots under the most favorable
tonditions? *However, each time the question of an embargo speed cutofr
for merchant ships has been discussed the commercial interests of one or
more COCOM members has prevented agreement,
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As a consequence of the U,S. having been forced to accept
List II (Quantitative) control for merchant ships, the principal area
of difficulty at the present time is in respect to List 11 shipping
eontrols, particularly in reaching agreement on an effective limitation
on the quantity of vessels to be supplied the European Sloc, List II
items may be supplied the Bloc either in accordance with an agreed
quota for the item or in accordance with the "3(d)" principle of COC(
Document No. 470 which in effect leaves the decision to the particular
country concerned.
COCOM Participating Countries have not been able to reach
agreement on annual or biennial tonnage quotas for List II merchant
eessels (including provisions for the thorny problem of quota car
nor on a speed limitation on merchant ships constructed or eold
to the Bloc. At the present time the only obligation on member
vountries is to consult COCOM before supplying the Bloc with merchant
vessels of more than 7,000 GRT, or having an operating speed loaded
of more than 12 knots. However, the requirement to pre-consult is not
a restraint on member countries because the power of decision whether
or not to supply remains with the particular country even if other
members of COCOM are opposed to the transaction. With respect to
other merchant vessels, the obligation of the PC 4s is nothing more than
to report the construction and sale of ships to the Bloc,
List III controls on ships pertain exclusively to small veseels
and no particular action is required of exporting countries so long
as shipments do not reach unusual quantities.
B, WiResavekesues_in COCOM.Ainping_gpntrolts,,
1. nred_liTitation_on merchant vssse4, The U0 S., has
favored embargo listing for vessels above an agreed speed, but in
the most recent discussion on this problem the U.S. has indicated
a willingness to accept List II coverage of ships capable of a
speed of 15,5 knots or more provided that PCos would undertake to
abide by COCOM decisions on proposed sales,
2. Quota for List II merchant shinps Despite the submission
ef various quota proposals by different COCOM countries, some of
which specified a tonnage figure in excess of the amount likely to
be supplied the Bloc, the oppositiou of one or more Pe ,s has each time
prevented an agreement,
3. No definitive understandW has been arrived at in respect
to permissible repairs on List I veeeels belonging to European Soviet
Bloc countries?
A-,
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COCOM Mae in 1951 agreed that there was no bareboat chartering
of List I vessels to the Soviet Bloc at the time. Since then they
have maintained an understanding that also in the future they would
not undertake any bareboat chartering which would be in contravention
of controls on sales.
The U.S. at one time sought to prevent long-term or voyage
chartering of all types of vessels to the European Soviet Bloc on the
ground that shipping services contributed directly or indirectly to
the Blocs war potential. Other COCOM members, however, were of the
opinion that controls on maritime transportation other than bareboat
chartering, which could frustrate the controls on sales of ships,
were inappropriate activities for COCOM. They believe that such
limitations on transportation services would in effect. be an economic
warfare measure and not a strategic control. In spite of this
unwillingness of the other COCOM members to forbid long-term or
voyage chartering of veseels to European Soviet Bloc countries, the
chartering of List I ships has not in fact occurred. Longeterm or
voyage chartering of List II vessels to the USSR or the European
Satellites is common. The other PCas have also been unwillIng,t0
prevent the carriage of strategic goods on their ships in traffie
between countries not embers of COCOM and the European Soviet Bloc,
or between one Bloc country and anothere
D. pootrols on Shlomand Shioningt2eryices to Communit_ChAna
The PCas of COCOM/CHINCOM have imposed more stringent controls
on the supplying of ships and transportation services to Communist
China in consequence of the UN embargo resolution against that
country. All types of new and used ships covered in any manner by
the specifications of the International and China Special Lists are
embargoed to Communist China, There is also an understanding that
PC as will not permit Communist China to charter merchant ships under
their flags or from their nationals. Finally, the principal maritime
PCas have unilaterally instituted controls which prohibit ships
registered under their respective flags from carrying embargoed
commodities to Communist China from any country of origin. Greek
regulations prohibit Greek flag vessels from calling at Communist
Chinese and North Korean ports, and U.S. Transportation Orders Tel
and T-2 prohibit U.S. flag vessels from carrying commodities
identified on the U.S. Positive List to any part of the Sino-Soviet
Bloc without prior authorization, and further prohibit U.S. flag
vessels from calling at any port in Communist China and North Korea,
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In
PRESENT COMPOSITION
OF THE SINO-SOVIET BLOC MERCHANT FLEETS
According to the latest ONI tabulations the Sino-Soviet Bloc
merchant fleets consis of some 1,075 ships (over 1,000 GRT) totalling
30583,03 GRT. This represents slightly less than 4% of total world
merchant ship tonnage. The USSR merchant fleets account for 848 ships
totalling 2,877,183 GRT, Poland for 83 ships totalling 330,400 GRT,
and Communist China for 117 ships totalling 285,088 GRT. Bulgaria,
Czethoslovakia, East Germany, and Hungary, account for the residua'
27 ships of 91,162 GRT. The USSR is the only Soviet Bloc country
with a sizeable tanker fleet, although its 88 tankers totalling .
450,294 GRT represent less than ?% of the world tanker tonnage. Table 1
provides a breakdown of the Sino-Soviet Bloc merchant fleet by type
of ship, size, speedo and age. Tablas 2 - 4 provide comparisons, of
this fleet with the total world merchant fleet by number and GRT of
ship types, and by percentage distributions on the basis of age and
speed. In order to round out the picture of Sino-Soviet Bloc merchant
shipping evailabilities,Table 5 provides a breakdown of Bloc naval
auxiliaries of 500 SDT and over which can be used in the carriage of
passengers and cargo,
It will be noted from Table 1 that much of the Sino-Soviet Bloc
merchant fleets tonnage consist of smallships, many of which are slow,
and, by western standards, considered over-age. Current shipbuilding
programs within the Bloc and procurement efforts from the Free-World
seek to redress this situation.
The comparison of the Sino-Soviet Bloc and total world merchant
fleets (Table 2) provides further indication of the marginal extent of
the Bloc fleets and tne relativeey minor Part it plays in the total
World shipping picture, The comparative age and speed profiles of the
Sino-Soviet Bloc and total world merchant fleets (Tables 3 and 4) show
that the Bloc fleets also are less efficient than those of the Free
World,
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V
SOVIET BLOC CAPABILITIES
FOR THE CONSTRUCTION OF MERCHANT SHIPS
Analysis of the Sixth Five-Year Plan and other data indicates that
the USSR, Poland, East Germany, axed Hungary plan to add approximately
2,078,000 deadweight tons (DWT) 11(1,588,000 GRT) of cargo vessels and
tankers to their maritime fleets during the period 1956-1960, 2/ In-
formation is not available on which to base an estimate for the re-
mainder of the Bloc countries including Communist China. The require-
ments for the remaining European Satellites is negligible. During
Chinies First Five-Year Plan, which ends in 1957, it added few vessels
to its ocean-going fleet. Although it is expected that a greater ton-
nage will be added to its maritime fleet during the next five-year plan,
no estimate of additions based on possible condtruction plans can be
made at this time. China has also the capability to construct tonnage
for its own use, possibly offsetting its demand.
Analysis of Plan and other data indicates that the USSR, Poland,
East Germany, and Hungary plan to construct approximately 2,225,000 DWT
(107250000 GRT) of cargo ships and tankers during the period 1956-19600
Planned produetlqn exceeds planned fleet increments by 148,000 DWT
(114,000 GRT). 21 ioreover, the Bloc will acquire about 339,000 DWT
(2700000 GRT) of cargo ships and tankers from non-bloc countries. If
all production plans are met, the excess production together with ire-
ports will make available bloc-constructed ships of 487,000 DWT
(3730000 GRT) for distribution within the Bloc to China, other European
Satellites, and for sale on world markets. For example, Poland is re-
portedly under contract to build 35,600 DAT of cargo ships for Brasil.
Besause of Soviet efforts at economic penetration in small underdeveloped
countries, it can be expected that ships of small tonnage, built in the
Satellites, will be offered for sale to these countries.
The term term deadweight tons (metric tons) used in this report is cargo
carrying capacity, as opposed to the difference in weight between
light ship and full load.
.2./ The increments to the maritime fleet are confined, in this report,
to cargo and tanker types. Aarbor vessels, dumb barges, passenger
ships, refrigerator ships, and auxiliary types are not included for
the reason that a negligible amount of freight is moved therein, The
exclusion of refrigerator ships is based on the past use of this class
of ship almost exclusively in the fishing industry rather than for
transportation of other perishable cargoes.
2/ It is not entirely clear from the wording of the Plans whether the
planned increment to the fleets refers to net or gross additions.
If it refers to net additions, at least part of the planned excess
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Although refrigerated vessels are not included in this estimate?
see footnote 2 on page 1, the USSR and East Germany plan to produce
about 40,000 DWT and the USSR plans to import about 31,000 DWT from
non-bloc countries,
The planned production of maritime vessels in the USSR indicates
yearly increases of slightly over 5 percent over the 1955 output.
This yearly increase can be accomplished without curtailing the 1955
rate of output of naval vessels of approximately 200,000 standard
displacement tons. It is !Ielieved at this time that the USSR will
fulfill its maritime production plan.
Between 1949 and 1955 Poland, the principal producer of maritime
vessels in the Sino-Soviet Bloc with excention of the USSR, produced
297,000 DWT of maritime vessels. In 1955 alone it produced over
102,000 DWT, The planned production for the current Five-Year Plan is
almost 7000000 DWT, Because the new plan includes larger and faster
vessels of a type not heretofore built in Poland and while the
reported 1956 output dhows some increase over the 1955 output, it is
doubtful that the overall plan will be fulfilled. Further complications
may arise because of the lack of indigenous production of large diesel
propulsion engines. The Soviet Bloc has not satisfactorily built
diesels larger than about 2,500 HP. Negotiations have been underway
for some time to obtain engines from non-bloc countries, Poland
procured during the past Polish six-year plan seven 8,000 HP diesel
engines from Italy, for installation in the 10,000 DWT-Class now building
in Poland. Poland, in 1956, obtained license from Switeerland to
build Sulzer diesels of unspecified horsepower, and has also placed
contracts with the Sulzer firm for diesel engines, In 19560 Poland
'purchased five six-cylinder diesels of 4,800 HP each from West Germany
for installation in the 6,000 DWT-Class cargo vessels now building in
Poland.
The production capability and possible plan fulfillment in East
Germany is less clear. East Germany during the period 1951-55 produced
possibly less than 100,000 DWT of maritime cargo and tanker types.
Like Poland, the current five-year program includes larger vessels not
heretofore built by East Germany, The current program is being delayed
because of lack of satisfactory diesel propulsion engines. At present
there are three or four 10,000 OWT cargo vessels that have been
launched but cannot be completed because of lack of diesel engines.
Again, like Poland, East Germany has negotiated with Western countries
for the procurement of diesel engines, Overall plan fulfillment by
East Germany is highly unlikely.
It is estimated, however, that the overall planned increment to
the maritime fleet will be met with only two-thirds plan fulfillment
by the three satellite countries.
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FREE WORLD SHIP. CONSTRUCTION FOR THE SINO-SOVIET BLOC
A. Tonnare Currently_Constructed or Repaired
New Construction ly5,571956
The construction of merchant and fishing vessels for the Sino-
oviet Bloc has never occupied more than a marginal share of total .
freeeworld shipping construction, although to certain countries and to
particular shipyards such construction has been of great importance.
Tables 7, and provide a comparison of total free-world deliveries of
ocean-going ships with free-world deliveries to the Sino-Soviet Bloc
or the years 1955 and 1956 respectively. It will be noted from these
tables that shipbuilding for the Bloc was of national economic
eignificance only in Finland, where the'USSR takes virtually all of
the ship construction, and to a much lesser degree in Belgium and
Denmark, where building for the Bloc amounted to 1I% and 5% respectively
in 1955, and 9% and 6% in 1956. On an overall basis, shipbuilding
for the Soviet Bloc amounted to less than 3% of the.1955'free-world
ehipbuilding total of over 4.5 million CRT, and 1956 total of almost
6 million GRTn
While Soviet-Bloc orders were on the whole not of major importance
te the contracting free-world countries, the ships received under these
eontracts represented a considerable portion of the annual tonnage
increment to the Soviet Bloc merchant fleet. Tables 9 to 12 provide
a eomparison of free-world and Soviet Bloc deliveries of new ships to
the Soviet Bloc merchant fleets for 1955 and 1956 respectively. Of the
total gross tonnage supplied, free-world deliveries accounted for 26%
and 2$% in 1955 and 1956 respectively, these portions being supplied
equal4 by COCOM and non-COCOM countries. Free world deliveries
consisted primarily of dry cargo ships, refrigerator ships, and fishing
veseels, since passenger ships and tankers are embargoed under COCOM
eegulations. Of particular importance to the Soviet Blots over and
above the actual tonnages of free-world construction delivered, is the
fact that free-world shipyard facilities and labor have wide technical
and technological experience and know-how and can generally be depended
upon to deliver their ships within the stipulated contract time. This
has been especially significant in view of the often lengthy delivery
delays encountered particularly in satellite shipyards,
4
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Tables 13 and 14 detail 1955 and 1956 free-world deliveries of
new merchant ships and fishing vessels to the Sino-Soviet Bloc. Total
tonnages delivered increased from 50,000 GRT in 1951 to 170,000 GRT in
1956. Of these, COC(] M countries delivered 17,000 in 1951 and 107,000 GRT
in 1956. (For the sake of comparison, Tables 12.. and 16 summarize Bloc
deliveries of new merchant ships to the Sino-Soviet Bloc fleets for
1955 and 1956 respectively) Despite repeated Soviet Bloc efforts to
place orders for embargo-type ships in COCOM countries (tankers in
Denmark and whaling factories in the Netherlands), no firm contracts
for such ships were signed during 1955-1956. Finland was the only
free-world country to construct tankers for the Bloc during this
period, Free-world shipbuilding for the Bloc during 1955 consisted
largely of refrigerator ships and fishing vessels, which together
accounted for 55% of the total construction of 115,000 GRT, Dry cargo
ships and tankers accounted for 25%. and il% of total construction,
respectively, the remainder consisting of dredges, tugs, and other
miscellaneous vessels, The emphasis on refrigerator ships and fishing
vessels, which continued through 19560 reflects the Post-Stalin Bloc
expansion of consumer goods industries. Of interest in 1956 free-world
deliveries to the Sino-Soviet Bloc is the appearance of larger type
dry cargo ships which comprised 30% of total deliveries. The first
orders for this type of vessel had been placed in 1953 (3 combination
icebreaker dry cargo ships in the Netherlands) and additional orders
during 1955 and 1956 are indicative of the Bloc's previously noted
(Section IV) interest in expanding its dry cargo fleet in line with
increased needs to service the rapidly developing Far Eastern areas,
trade expansion in general, and economic penetration efforts in
particular,
Tables 15 and 16 provide a breakdown of merchant ship and fishing
vessels currently under construction and on order respectively, in
free--world countries. These tables clearly indicate the Blocs continued
and increasing interest in procuring the larger types of dry cargo ships
which account for over 60% of the total tonnage,
sof Second-Hand aum
While free-world deliveries of new construction tonnage to the
Sino-Soviet Bloc has increased considerably during 1955 and 1956 over
the preceding years, in part du* to the completion of orders previously
placed, sales to the Bloc of second-hand tonnage have shown a marked
decline from a high of almost 110,000 GRT in 1951 to 19,000 GRT and
17,500 GRT in 1955 and 1956 respectively. Bloc efforts to obtain second-
hand tonnage at this time appear to be restricted to spot purchases as
particular needs arise, and there is no indication of any sustained
effort to obtain second-hand ships,.
ZiX1
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GRP r.L.1 Li* WS, GROS.
Free-World repairs of Sino-Soviet Bloc ships, which previously
had been considerable, fell off rather sharply during the past two
years. The one outstanding exception to this is the Rumanian
TRANSYLVANIA, which is still undergoing "extensive repairs" in Yugoslavia,
after such repairs had been turned down in various GOCOM countrieeo
J ii IL
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B. Estimate of Future Trends in Free-World ShisR Construction for
the Sino-Soviet Bloc
Si:no-Soviet Bloc Plans for Merchant Fleet Expansion
Soviet Bloc Plans for 1956-1960, as shown in Section IV above, call
for a total construction of 1,351,760 GRT of cargo ships and 366,600 GRT
of tankers, The following statistics are based on Table No. 6. In
addition, orders placed by the European Soviet Bloc in non-Bloc countries
which are either now in the process of fulfillment or on which some
deliveries have already been received, total 221,400 GRT of dry cargo
ships and 12,400 GRT of tankers.
The foregoing figures as such do not provide a complete picture,
however, of the projected increment in the Soviet Bloc merchant fleets.
Of the total of 1351,760 GRT cargo ships, slightly more than a half
are to be built for the producing countries and the remainder is
available for exports to other Bloc countries, and to the free-world.
According to present information, only 27,640 GRT of Polish cargo ships
are scheduled as construction for export to non-Bloc countries.
The planned increment figure for cargo ships in the Soviet Bloc
maritime fleets for 1956-1960 appears to be lower (1,209,400 GRT) than
the planned indigenous Bloc production figure. If construction plans are
nearly fulfilled, this would point to an ,mertpdia_ eumlue of carge
ship tonnage to be constructed in the next few years? I/ The paradoxical
element in this picture is, however, the scheduled. import from non-Bloc
countries of 221,400 GRT or cargo ships which has been projected for the
period 1956-1960 as mentioned above. The paradox can be explained by
the fact that procurement of ships from the free world reflects in all
instances Bloc preference for special technical developments available
only in ships built in free-world yards, or contracts dictated by foreign
policy or propaganda requirements, or both. The type of ships of which
the Bloc might have an exportable surplus presumably would not incorporate
advanced technical features,
All of the tanker tonnage projected for construction for the period
1956-1960 is to be added to the merchant fleets of the producing countries.
The gap between indigenous Bloc tanker construction and the projected Bloc
tanker fleet increment is to be closed exactly by the planned procurement
or 12,400 GRT from non-Bloc sources (Finland)*
Production Problems and Plan Fulfillment
From the foregoing it can be seen that particularly in the dry
cargo ship field the Bloc is likely to be able to meet fleet increment
goals for 1956-1960 even if plan fulfillment in the Satellites should
;01me up to only 75% of projected construction goals, As indicated in
To the extent that planned tonnage increments refer to net
additions to the respective maritime fleets, at least a part of
this exportable surplus may be required to replace brokenedown
tonnam
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greater detail in Section IV above, Satellite ship construction, in
the past few years, has fallen considerably short of plan goals although
shipyard facilities as such .are fairly adequate. It may reasonably be
expeoted that Satellite construction during the current plane Will again
fall short of goals, due in part to the lack of indigenous production
of adequate propulsion machinery and the general delays and disruptions
in industry resulting trod continued political unrest.
A case in point is East Germany, According to numerous reports,
East Germany continues to be unable to meet construction goala for
10,000 ton DWT freighters due to her inability to iron out the difficulties
encountered in producing the 2,400 h,p. Diesel propulsion madhinery.
It is exactly this larger type of ship which figures prominently in
future Bloc production plans so that the procurement problems for
propulsion machinery may also be assumed to persist.
The political upheavelein the European Satellites of last year
and particularly the economic readjustments which Poland haa been
undertaking, are likely to. affect the implementation of Polish Merchant
shipbuilding plans. In many instances it will only be necessary to
import propulsion. machinery * and other special equipment to assure
fulfillment of planned merchant fleet increases, but the placement of
some orders for larger ocean going dry-oargo ships May be attemPted
in free-world yards if Poland's foreign exchange position. is adequate
for the Metes
On the basis of past performance as regards facilities and
required imports there is no reason to anticipate any inability of
the USSR in meeting its planned merchant ship production goals..
gLoo BukidingeOrdere for Free-World Shipyards
Information to date is incomplete as to the exact volume of the
building orders which the European Bloc will place pursuant to 1956
procurement plans for the period 1956-L960. Even for trade agreements
which received some publicity, such as the Russo-French trade agreement
eof 1954 which provided for the eventual delivery of 16 merchant Ships,
6 of which were delivered in 1936, no further information is available
on exact details of additional implementing contracts. Similar4s
under the Russo-Finnish trade agreement of 1956, a larger number Of
ships appears to be scheduled for delivery but verifiable details are
not available,
While Poland recently obtained patent rights to produce the Swipe
Sulzer diesel engine (see Section IV above), it takes a considerable
length of time to develop the necessary production facilities so
that actual Polish production of these engines is not expectedefor
several years.
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e'm.111*. semo
Reny of the erders placed by the European Soviet Bios in Fre
World yarde have been dicteted, as regards timing or exteet, by
political as well as economic motivees A prominent case of this tespe
have been the repeated attempts of the USSR to influde aeditloriae
sankers in the list of geode to be supplied by Denmark pursuant eo
%rade agreements Free-werld ehipyards in the principal eroducing
eeuntrees now nave ordee backlogs reaching to 1962, a eieuatiors whieh
eight persist even longer if shipyard strikes of longe; durations
ehould occur it the future. This meght further increase the premiums
fer placing coestructioa orders white in the past the Klee has
aeually been ale te place, Greatest pressure from the Lurosaan aloe
..eor acceptance in the free-world of additional construetsen is lskely
eo be concentrated on highly specialized craft such as the ie-
eseaker cargo 'ships now under construction or on erder in the Nessereande.
Orders for refrigerator tonnage now constituee a Large sease of
Bloc shipbui7eding orders in free world yards Thare may a tepeae
eeders on some or these contracts for subsequent yeart feem reee-eorld
eoureee.
It is itst, to be .anticipated that tanker tonnage iil1 b.
procured from C;OCOM countries as long as the COCOM ernbarp.;:, El3ritinuras.
Fishing Vessels
The USSR fishing fl whichis the largest compoeene of the
Ana-Soviet Blec fishing fleet, consisted of approximatOy 1,100,000
GRT in 1956. The size of the fleet and particularly the eate of ite
projected increases usually are made contingent on Soviet Bloc fieh
eaech goaiss The most eienificant developments in this respect are
eontineed ineroaseir, for the fishing fleets in European wa,ers for
feshery operateons and as stand-by units for war seriel mineesseeners,
radar pickets): the greatly expanded fishery activities ce the Soviet'
In the eaters north of the japanese isles in the Far East. inceuding
pelagic sealing toward the Bering Strait and more numeroue ebaleng
expeeitione to the Antartie (which is governed in turn be the nutlIbta.
Lisa feetoreee and tanker tonnage available )s
-,t) the post World War II period there has been a eteady Ancestress)
In the indigenous Bloc construction of fishing vessels buS even this
ivereaee has not satisfied the full demand of shin required to mete
feehere produceion goals, earticularly after the pest-Stelin shl.ft
en Bloc policies; from emphasis of apetal goods proeucteee to eoneumer
geode, ehe aloc began to pia ee large orders for aie types of fishing
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vessels in free-world countries to boost the rate of fishing fleet
additions, The largest number of orders for fishing vessels in the
free-wwld appears now to have been placed but it is likely that at
least some additional new orders will continue to be placed in free
world ship yards, particularly for fishing vessels specializing
either in catching or in processing devices,
Procurement of Second Hand Shlpt
No estimates can be made of likely future purchases, by the
Sino-Soviet Bloc, of second-hand ships in free-world countries, As ?
stated earlier, used merchant ship procurement in recent years (1955-1956)
has been infrequent, and was limited to a few units purchased by Satellite
countries (Bulgaria and Poland). It may be expected that the USSR will
continue to concentrate chiefly on the acquisition of new ships, but
occasional purchases of second-hand tonnage, particularly by the Satellites,
cannot? be ruled out.
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VI
SUMMARY
It is difficult to assess the current impact of free-world
controls over shipbuilding and shipping services on Soviet Bloc
planning in the shipping field. There is reason to believe that
these controls were in the past at least partially responsible
for the timing and phasing of the Russian Kazbek-class tanker
building program, To the extent that the Bloc has been able to
adjust to the control system, or has been able to circumvent it
by placing orders for eMbargoetype ships in non-COCOM countriesp
e.g., Finland, the effectiveness of this system has been mitigated,
On the other hand, however, the very pressure which the Bloc
eontinues to bring to bear on countries adhering to the COCOM
embargo on ship sales and other shipping controls, seems to be an
indication that these controls may still represent fairly signifi-
oant harassment,
The Soviet Bloc has sufficient shipyard facilities for
currently planned construction of merchant and fishing vessels.
However, there are weaknesses in the Bloc shipbuilding picture.
Particularly the satellite countries are deficient in some tech-
nological know-how, and as yet neither the Satellites nor the USSR
have been able to produce the larger diesel propulsion machinery
rewired for larger and faster ships. As of this time, the lack
of such machinery appears to present the major obstacle facing
Satellite fulfillment of planned shipbuilding goals, On the basis
of current estimates, however, the Soviet Bloc as a whole will be
able to meet the planned increment to its maritime fleet.
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