NATIONAL INTELLIGENCE ESTIMATE NUMBER 42.2-56 PROBABLE DEVELOPMENTS IN NORTH KOREA OVER THE NEXT FEW YEARS

• Document Type: FOIA
• Keywords: NORTH KOREA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 0005500089
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• Document Creation Date: June 24, 2015
• Document Release Date: March 3, 2010
• Case Number: F-2009-01733
• Publication Date: July 3, 1956

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RELEASE DATE:
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NIE.42.2-56
3 July 1956
NATIONAL INTELLIGENCE ESTIMATE
NUMBER 42.2-56
PROBABLE DEVELOPMENTS IN NORTH KOREA
OVER THE NEXT FEW YEARS
Submitted by the
DIRECTOR OF CENTRAL INTELLIGENCE
The following intelligence organizations participated in the
preparation of this estimate: The Central Intelligence Agency
and the intelligence organizations of the Departments of
State, the Army, the Navy, the Air Force, and The Joint Staff.
Concurred in by the
INTELLIGENCE ADVISORY COMMITTEE
on 3 July 1956. Concurring were the Special Assistant, Intelli_
gence, Department of State; the Assistant Chief of Staff,
Intelligence, Department of the Army; the Director of Naval
Intelligence; the Director of Intelligence, USAF; and the
Deputy Director for Intelligence, The Joint Staff. The Atomic
Energy Commission Representative to the IAC and the Assist-
ant Director, Federal Bureau of Investigation, abstained, the
subject being outside of their jurisdiction.
COPY NO.
ASS ISTANT DI1 ECTOR, ONE
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 S\ RE T
PROBABLE DEVELOPMENTS IN NORTH KOREA OVER
THE NEXT FEW YEARS
THE PROBLEM
To analyze the present strengths and weaknesses of the North Korean regime and
to estimate future developments and trends over the next few years.
CONCLUSIONS
1. The Korean Communist regime will
almost certainly retain firm control of
North Korea through 1960, and the
USSR will probably retain its predomi-
nant influence over North Korea's inter-
nal and external policies. Communist
China probably will continue to make a
substantial economic contribution to
North Korea and its military forces will
continue to be available for the defense
of North Korea. Although Communist
China will continue to play an important
part in the formulation of Bloc policy
toward North Korea, we believe it will not
attempt to dislodge the USSR as the dom-
inant power there. (Paras. 50-51)
2. The objective of the Communists con-
tinues to be the gaining of control over
the entire Korean peninsula. We believe
that they will not resort to force to obtain
this objective, at least so long as the US
remains committed to the defense of the
ROK. However, the Communists will
continue their attempts to undermine the
ROK through overt and covert political,
diplomatic, economic, and propaganda
appeals to South Korea for economic, po-
litical, and cultural contacts, and for
"Korean" measures to bring about unifi-
cation. We believe that in present cir-
cumstances the Communists will prob-
ably not make substantial progress in
these efforts. However, either in the
event of the death of Rhee or a decline
in US economic and military support,
their unification tactics are likely to be
accelerated and much more effective.
(Paras. 53-54)
3. The Communists will probably con-
tinue to press for the withdrawal of
UN/US forces, and for international ne-
gotiations on Korean unification, but
they almost certainly will not make any
concessions which would weaken their
firm hold on North Korea. In fact they
would probably accept serious military
risks to maintain their position. (Paras.
52-53)
4. Despite reductions in over-all strength
since the Armistice, Communist armed
forces in Korea could still launch a lim-
ited attack with little warning. The Chi-
nese Communists will continue to have
the unopposed capability to reinforce
units in contact along the demarcation
line with a maximum of six armies in
from 10 to 14 days after the initiation of
SR E T 1
 \RET 2
movement from present assembly areas.
North Korean armed forces now include
a re-equipped and reorganized army of
some 350,000 men and an air force with
310 jet fighters (Fagots) and 65 light jet
bombers (Beagles). Although the North
Korean ground force is well below the
strength of the 650,000-man ROK army
and may undergo a strength reduction of
80,000 this year, North Korean air force
strength is far superior to that of the
ROK. (Paras. 40, 42, 48-49)
5. The Chinese Communists have steadi-
ly reduced their troop strength in Korea
and now have less than 300,000 men in
the area. The chances are about even
that Chinese Communists will complete
the withdrawal of their troops within the
next year or so in order to enhance the
independent appearance of the North Ko-
rean regime and to increase pressure on
the US/UN command to complete its
withdrawal. However, the Chinese Com-
munists may wish to retain some troops
in North Korea in order to maintain po-
litical influence in the area and a rough
parity of ground force strength with the
ROK.1 (Paras. 44, 52)
6. Although living standards remain ex-
tremely low in North Korea, rehabilita-
tion of the severely damaged industrial
and agricultural industries is well ad-
vanced. With substantial material and
manpower assistance from the Bloc, in-
dustrial output is rising and will probably
reach 1949 levels in most sectors by the
end of 1956. By 1961 the North Korean
economy will probably be able to make a
modest contribution to the Bloc's eco-
nomic potential in the Far East in the
fields of metals, chemicals, and electric
power. However, a serious manpower
shortage, lagging production in agricul-
ture, and lack of adequate consumer
goods industry will continue beyond 1956
to hamper efforts to raise living standards
and to increase the regime's appeal in the
ROK. (Paras. 27-29, 33-38)
DISCUSSION
1. INTRODUCTION
7. North Korea is a Communist Satellite simi-
lar to the "people's democracies" of Eastern
Europe. Under the direction and control of
Soviet officials and Soviet occupation troops,
Korean Communist leaders in the period 1945-
1948 developed an all-powerful Communist
party, extreme centralization of authority,
detailed supervision and control of nearly all
aspects of national life, stringent internal
security controls, and a governmental struc-
ture with power concentrated in the Cabinet.
Despite the near total destruction of the
North Korean army and economy during the
Korean War, the regime has emerged with
its basic structure and control unimpaired.
8. The primary objectives of the Communists
in North Korea have been to build a strong
regime, to develop and maintain an effective
military organization, to develop a strong so-
cialized economy closely inter-related with
that of the Bloc, and to unify Korea under
The Special Assistant, Intelligence, Department
of State, believes that the factors impinging on
a Chinese Communist military withdrawal from
Korea are so uncertain as to make it impossible
to estimate that the chances are about even that
complete withdrawal will occur within the next
year or so. Although such a move would con-
form with the Communists' current "peaceful"
pose, such factors as Chinese Communist interest
in maintaining influence in North Korea, Chinese
Communist commitment of military labor in
Korea as a contribution to North Korean rehabil-
itation, possible Soviet uneasiness about the
strength of the North Korean forces at this stage
of development, and the desirability of timing a
military withdrawal in such a way as to gain
maximum political advantage may militate
against complete withdrawal in the immediate
future.
 Communist control. The importance of North
Korea to the Bloc was emphasized by the en-
try of Communist China into the Korean War
despite the risks of a broadened conflict, by
the large scale military effort during the hos-
tilities, and by the economic and technical
assistance extended since the Armistice.
From the point of view of the Bloc, loss of
North Korea would be a serious blow to Com-
munist prestige elsewhere and would greatly
increase the vulnerability of Manchuria and
the Soviet Far East to US and Japanese pres-
sures. North Korea is also important to the
Sino-Soviet Bloc as an instrument for the
extension of Communist control throughout
the peninsula, a development which in turn
would enhance Communist prospects in Ja-
pan. The Bloc also has an interest in the
development of the modest North Korean eco-
nomic potential.
Chinese and Soviet Influence in North
Korea
9. The Chinese Communists probably have
had a considerable voice in the development
of Bloc policy toward North Korea since 1950,
but we believe that the USSR retains its para-
mount position in North Korean affairs.
Leadership and control remain firmly in the
hands of the Koreans brought into Korea by
the USSR in 1945. Soviet influence remains
predominant in the North Korean armed
forces. Soviet advisers retain the direction of
economic planning and there apparently are
no Chinese Communist advisers at the minis-
terial level or in other top policy positions.
Although the monetary value of Communist
China's aid to North Korea apparently ex-
ceeds that of the USSR, the Soviet contribu-
tion to the economy is probably of greater
long run significance, as a large proportion of
Soviet aid is for the reconstruction of basic
industries, whereas the greater share of
China's aid is in the form of consumer goods
and the rehabilitation of buildings and trans-
port facilities. Technicians from the USSR
work in practically all types of industrial in-
stallations as well as in agriculture and city
planning, whereas Communist China has lim-
ited its contributions of technical personnel
largely to railroads, light industry, and build-
ing construction. Additional indications that
the Soviet Union retains its pre-eminent posi-
tion include: the Russian language is more
widely taught than Chinese; more Korean
students are in school in the USSR than in
China; and the North Korean press and radio
propaganda credits the Soviet Union with pri-
mary responsibility for progress in North
Korea.
Communist Organization in North Korea
10. The Soviet Union has exercised its author-
ity and pursued its objectives in North Korea
through key members of the Korean Labor
Party (the Communist Party in North Korea).
Party members usually serve in the dual ca-
pacity of party and government officials and
thus are in control of the government at all
levels.
11. Three groups of Korean Communists ap-
peared on the scene immediately upon the
removal of Japanese control. A "domestic"
group consisted of the Communist revolution-
aries who had remained in Korea during the
Japanese occupation. Another and the most
numerous group was the Koreans who re-
turned home from the Communist-held areas
in North China. The most influential group,
however, was that which entered Korea in
the fall of 1945 with the Soviet army directly
from the USSR. This latter group was com-
posed of former Korean partisans who had
fled Manchuria around 1940, and Korean col-
onists in the Uzbek SSR and the Kazakh SSR
(known as Soviet-Koreans). Many of the
Soviet-Koreans who accompanied the Soviet
army had been long-term residents and citi-
zens of the USSR. Some had been trained in
Soviet technical and political schools, were
members of the Soviet Communist Party, and
had government experience in the Soviet
Union.
12. In October 1945, Kim 11-sung, an ex-parti-
san who had returned to Korea as a captain
in the Soviet army, was placed at the top of
the Korean Communist Party structure, and
returnees from the USSR entered the party
 S CRET 4
organization at the central and provincial
levels. The returnees from China ("Yenan"
group) at first formed their own group, but
in August 1946 they were absorbed in the
newly formed North Korean Labor Party. Al-
though some of the "Yenan" group held posi-
tions of prominence in the new party, none
apparently held positions of great political
power. Kim 11-sung and the late Ho Ka-i, a
former Soviet Communist Party official,
emerged as the chief figures in the party and
government.
13. The "domestic" group in the meantime
had attempted to operate in South Korea as
the South Korean Labor Party but its lead-
ers were forced to flee into the Soviet zone.
In 1949 the South Korean and North Korean
Labor Parties were merged to form the Ko-
rean Labor Party with control firmly in the
hands of Kim 11-sung and his group.
14. The power and authority of the Korean
Labor Party and its prewar leadership re-
mained intact during and following the Ko-
rean War. Since the war, the "domestic"
group has been denounced and most of its
leaders have been eliminated or removed, and
the "Yenan" group has gained no ground.
The Third Party Congress, meeting in April
1956, gave formal public approval to the meas-
ures taken by the Central Committee to rid
the party of "cliques" and "undesirable ele-
ments," and warned against the survival of
factionalism. Although the Congress com-
mended the party leaders for strictly adher-
ing to the principle of "collective leadership,"
Kim 11-sung appears to dominate both the
party and the government.
15. It is difficult to evaluate the North Korean
leadership since Soviet advisers have always
participated heavily in both the processes of
decision and the implementation of policy.
With this assistance the leadership has effec-
tively exploited the country's manpower and
resources. However, the leaders have demon-
strated little of the flexibility and skill of the
Chinese or Vietnamese Communists in adapt-
ing Communist theory to local conditions.
Unlike Ho Chi Minh, for example, North Ko-
rean leaders have not emerged as the center of
a national movement with a defensible claim
to popular support, and have established no
distinctively Korean character in the state
which they created. Loyalty to the USSR and
political dependability have been the prime
criteria for the selection of government lead-
ers and administrative personnel.
Dissidence and Resistance
16. The great majority of the North Koreans
probably dislike the regime and appear to re-
spond apathetically to its demands and ap-
peals. The top leaders are too obviously
agents of the Soviet Union to command full
respect as "Korean" leaders. There appears
to be chronic resentment against heavy taxes,
collectivization, low living standards, and gov-
ernment controls. However, there is no evi-
dence of the existence of any significant or-
ganized resistance to the regime, either overt
or covert. The Internal Security Forces, as-
sisted by local police units, maintain close
surveillance over the population, which is or-
ganized into groups of five families. It is
highly unlikely that resistance groups could
be organized which could take effective action
against the regime. Although there would
probably be some positive resistance action in
the event of a resumption of hostilities, it
would almost certainly not be widespread or
effective.
Relations with the non-Bloc World
17. From the time of its formal establishment
in 1948, the North Korean regime has claimed
to be the legitimate government for the whole
of the peninsula, and the Supreme People's
Assembly, elected in August 1948, includes
deputies allegedly chosen by clandestine elec-
tions in South Korea. Although the tactical
emphases of the regime's unification line have
changed from time to time, the basic claim
has not. The area now under the control of
the regime is normally officially referred to
as "the northern half" and the government
of the ROK is usually termed the "Rhee bandit
clique." The current Communist official posi-
tion on unification, enunciated at the Geneva
Conference in 1954, proposes that a commis-
sion representing both North and South Korea
be established. This commission, in which
 RET 5
the Communists would have an effective veto,
would supervise elections and exercise some
controls over the whole country before the
elections. Although the Communist claims
and their program for unification have had
little effect in South Korea, the Communists
have persisted with their line in an apparent
effort to keep before the world their claim as
the legitimate government of all Korea, and
to conform to the universal Korean aspiration
for unification.
tion of Korea through free elections and failed
to respond to UN cease-fire demands at the
outset of the Korean War. Its noncooperation
with international bodies was extended to the
work of the Neutral Nations Supervisory Com-
mission. The inspection teams in North Ko-
rea, which have now been transferred to the
Demilitarized Zone, were restricted in their
movements and not permitted to observe the
introduction of aircraft and new type weapons
into the area.
18. In the meantime, North Korea continues
its generally ineffective attempts to weaken
and eventually to subvert the ROK by organi-
zation of Communist cells and the conduct of
espionage in South Korea, by propaganda
aimed at the South Koreans, and by frequent
appeals to South Koreans for economic, politi-
cal, and cultural contacts.
19. Despite continuing efforts to obtain inter-
national recognition, North Korea has no for-
mal diplomatic relations with any non-Bloc
country, and almost no contacts outside the
Bloc except with groups in Japan. The Com-
munists probably hope that by developing
North Korean contacts with Japan they can
increase ROK distrust of Japan and hamper
US efforts to develop ROK-Japanese coopera-
tion. Like Communist China and the USSR,
North Korea has attempted to woo Japan
through exploitation of Japanese interest in
fishing rights, in the repatriation of Japanese
nationals still in Communist areas, and in
trade. A Japanese Red Cross team visited
North Korea in February 1956 to negotiate
the repatriation of Japanese nationals. How-
ever, the Japanese have shown little interest
in trade relations.
20. North Korea's principal lever in exerting
its influence in Japan is the 600,000 to 800,000
Koreans living there. A significant number
of these are active Communists and probably
a majority are Communist sympathizers. The
Japanese, however, are gradually bringing this
minority under control and its potential as a
threat to internal security and civil order is
steadily declining.
21. The North Korean regime has consistently
ignored UN resolutions calling for the unifica-
III. ECONOMIC PROBLEMS
22. The Japanese invested heavily in rail lines,
communication systems, and industrial plant
in the northern part of the Korean peninsula
to take advantage of the iron ore, low grade
anthracite, graphite, nonferrous ores, water
power, and timber resources in that area.
Light industries and the production of con-
sumer goods were not developed and northern
Korea's primary role was to supply raw mate-
rials, semiprocessed metal products, power
and chemicals to Korea, Japan, and Manchu-
ria. The Japanese controlled nearly all of the
industry in North Korea and provided the
bulk of the skilled labor and management.
The principal Korean contribution to the in-
dustrial development was the unskilled and
semiskilled labor force.
23. The North Korean economic pattern was
not altered significantly following the Soviet
occupation in 1945, except that the output
of the raw materials and heavy industries was
exported to the Soviet Union. Investment was
concentrated in mining and heavy industry
and the USSR gave material assistance only
to those segments of the economy which con-
tributed directly to Soviet needs. Offices of a
number of Soviet government agencies were
established in North Korea, and Soviet politi-
cal and technical advisers were attached to
the ministries and the major industrial plants.
Although North Korea remained barely self-
sufficient in food, widespread shortages in
other consumer goods soon developed with
the cutting off of contacts with former sup-
pliers in Japan and South Korea.
24. During the Korean War, North Korea's
industrial plant was largely destroyed, and
 the rail and highway systems and urban hous-
ing were severely damaged. Agricultural pro-
duction was severely disrupted by extreme de-
struction of livestock, irrigation facilities, and
many of the grain storage bins, and by an
acute shortage of farm labor, implements, and
chemical fertilizers. North Korea became one
of the most destitute areas in Asia.
25. Moreover, the Korean War intensified the
country's manpower problems. We believe the
population dropped during the Korean War
to slightly less than eight million people, or
about 13 percent below the estimated pre-
hostilities level. The proportion of the popu-
lation in the work age group is probably well
below normal and females are believed to out-
number males by a ratio of three to two. Mili-
tary levies further reduce the labor force avail-
able to the civilian economy. More important,
however, is the serious and continuing short-
age of technically qualified personnel.
26. Immediately following the Armistice, a
Three Year Plan of reconstruction was adopt-
ed which, with the exception of the nonfer-
rous metals and chemical industries, would
generally restore industrial production, by
the end of 1956, to the 1949 levels (the highest
levels achieved under Communist manage-
ment and supervision but still below peak
Japanese production during World War II) .
Investment and manpower resources were to
be concentrated on reconstructing heavy in-
dustry. The original plan also called for the
production, in 1956, of 3.27 million tons of
food crops, 1.05 million tons over the 1949
level. In addition, preparation of a Five Year
Plan for the general development of industry
for the period 1957-1961 was begun.
27. North Korea apparently will fulfill many
of the industrial goals set in the Three Year
Plan, and probably will exceed these goals in
the fields of railroad transport, electric power,
and ferrous metals. Trends in the industrial
sector and some of the short and long range
goals are shown in Table 1, page 7.
28. Although housing construction and pro-
duction of most consumers goods has been
emphasized in North Korean pronouncements,
performance and actual investment in this
area have remained far below requirements.
In the case of cotton textiles, for example, pro-
duction is still less than half of current con-
sumption. Substantial imports of consumers
goods including food, mainly from Communist
China, have been necessary in order to main-
tain a bare subsistence. In addition food and
most other consumers goods are rationed and
money wages are supplemented by a grain
allowance.
29. In 1955 the government made strenuous
attempts to increase agricultural production
through incentive rewards for overfulfilling
food production quotas, and reduction in agri-
cultural taxes-in-kind. Although the 1955
food crop harvest was reported to be larger
than that of 1954, severe drought in the west
coast provinces, inefficient management of
farm cooperatives, and a lack of adequate
irrigation facilities and chemical fertilizers,
prevented fulfillment of the grain production
quota. As a result, the 1956 production goal
of 3.27 million metric tons of food crops has
been revised downward by some 500,000 metric
tons,
30. All major industrial and commercial en-
terprises were nationalized soon after 1945,
but little progress was made in the collectivi-
zation of agriculture before the Korean War.
Since 1953 the regime has attempted the rapid
formation of cooperatives in agriculture, not
only to bring this sector in line with the rest
of the economy, but also in the hope of
rationalizing the use of the short labor supply,
of gaining better control over output, and of
increasing farm productivity. Only about
one-third of the farmland in North Korea is
still being cultivated by noncollectivized
farmers.
Sino-Soviet Bloc Assistance
31. Progress in rehabilitation has been possi-
ble only because of extensive Bloc financial,
material, and technical assistance. In 1954
and 1955, total Bloc aid, valued at official
exchange rates, amounted to $470 million.
Neither prices nor exchange rates prevailing
in these transactions are known. Official ex-
change rates considerably overvalue the dol-
lar amount of aid listed below. The value of
SEET
 Estimated and Planned Production of Selected Commodities in North Korea
1944, 1949, 1954, 1955, 1956, 1981
1944'
1949'
1954'
19552
t
d
1956'
1961'
Fi
Estimated Estimated
Actual Actual
Estimated
Actual
Estima
e
Actual
Three
Year
ve
Estimated Year
Commodity Unit Production
Production Production Production
Plan
Production Plan
Electric power
(capacity) Million kw
Electric power
(production) Billion kwh
7.5-8
5.9
2
3
3.8
4.3
8.5
Million mt
6.1
4
2.1
4
4
5
8.5
Thousand mt 3,200 400
140
480
na
820
- -
Pig iron Thousand mt 525 166
61
160
180
265
500-550
Crude steel Thousand mt
150
145
50
175
na
200
525-600
Finished steel Thousand nit
88
108
38
132
na
150
400-450
Metallurgical
coke Thousand mt
na
268
Negligible
130
200
200
--
Cement Thousand mt
958
537
400
510
650
585
1,000-1,500
Copper
(refined) Thousand mt
na
5.6
1
3
na
3.5
Lead (refined) Thousand mt
na
9.4
1
6
na
7
Zinc (refined)
Thousand mt
na
8
Negligible
1
na
2
Chemical fer-
tilizers
Thousand nit
500
400
5
30
150
150
400
Cotton fabric
Million lm
na
9.4
23
38
48
48
-
The peak production year under Japanese rule.
"Production estimates represent only a general order of magnitude. They are based on North Korean
announcements and upon our estimates of the production potential of some plant and mining facili-
ties.
 the nonmilitary items delivered in 1954 and
1955 by the USSR apparently approximated
US $189 million of which some 75 percent
consisted of capital goods and the remainder
of consumer goods. During the same period
Chinese Communist goods delivered to North
Korea approximated US $215 million of which
about 55 percent consisted of food and cloth-
ing. Announced value of aid delivered from
the European Satellites during 1954 and 1955
was US $65.5 million. According to the an-
nounced North Korean budget, total Sino-
Soviet Bloc aid accounted for about 29 percent
of the regime's total receipts in 1954 and for
about 21 percent of the total receipts in 1955.
32. Bloc countries have also alleviated the ad-
verse effects of the manpower shortage. There
are probably some 5,000 Bloc civilian technical
personnel working in North Korea, including
about 1,500 from the USSR, 1,800 from Com-
munist China, and 1,700 from the European
Satellites. Moreover, large numbers of Chi-
nese Communist troops and laborers have
been used in rebuilding bridges, public build-
ings and housing, and restoring the railroad
transportation system. Chinese Communist
personnel were also recruited for work in
agriculture, light industry, and handicraft
industries during 1954 and 1955.
Economic Prospects
33. The goals of the new Five Year Plan
(1957-1961) which were announced at the
Third Congress of the Korean Labor Party in
April 1956, are consistent with estimated cur-
rent trends of economic development. Bar-
ring a renewal of hostilities in Korea or a
major political upheaval in the Far East, the
Communists probably will achieve substantial
success in implementing the plan. Continued
Sino-Soviet Bloc material aid and technical
and manpower assistance will be required, but
such aid will probably increasingly take the
form of credits rather than grants. Trade
with Bloc countries will probably increase.
34. Under the Five Year Plan, heavy industry
will continue to receive the major share of
expenditures for development and reconstruc-
tion. Investment in the expansion of non-
ferrous mines and smelters will continue to
receive a high priority. Although electric
power production is still below existing capac-
ity, nevertheless it is more than ample to meet
present requirements and large amounts are
being transmitted to Communist China. The
major investment in the chemical industry
probably will continue to be in the expansion
of nitrogenous chemical facilities, particularly
those used in the production of fertilizers. A
modest engineering industry is planned, capa-
ble of producing agricultural implements, tex-
tile and mining machinery, automotive parts,
hand tools, and low-precision machine tools.
35. Construction and expansion of consumer
goods plant facilities beyond those contem-
plated in the Three Year Plan (1954-1956)
probably will be slight. Instead, greater em-
phasis probably will be placed on utilizing
existing plant facilities more intensively and
on raising labor productivity. With continued
Bloc technical assistance, by the end of 1961
North Korea probably will be producing con-
sumer goods such as cotton and silk textiles,
rubber shoes, and paper at a rate well in excess
of 1956 levels.
36. Although mismanagement and apathy on
the part of members of cooperatives may con-
tinue to hamper agricultural production, the
increased use of chemical fertilizers, insecti-
cides, and better quality seeds, combined with
improved irrigation facilities, may permit
North Korea to achieve its Five Year Plan
goal of self-sufficiency in basic food require-
ments. Agriculture will probably be fully col-
lectivized by the end of 1961.
37. As a result of continued technical educa-
tion, indigenous skilled labor may be capable
by 1961 of assuming many of the technical
industrial positions held by Bloc technicians.
However, the shortage of indigenous man-
power and skills is likely to persist as the
higher production program of the Five Year
Plan goes into effect.
38. In general we believe that North Korea
will make gradual economic progress over the
next few years, subject to the limitations im-
posed by an apathetic population, administra-
tive inefficiency, and Communist planning.
Improvement in the material welfare of the
 SERET
people will probably lag considerably behind
industrial development because of the re-
gime's unwillingness to allocate substantial
resources for the import or production of con-
sumer goods. By 1961 the North Korean econ-
omy will probably have gained sufficient
strength in the metals and chemical indus-
tries and in electric power production to make
a modest contribution to the economic poten-
tial of the Bloc in the Far East.
IV. MILITARY STRENGTH
39. Communist armed forces in North Korea,
which now total approximately 640,000, con-
sist of Chinese Communist army units and
the armed forces of North Korea. The latter
are maintained, supported, and controlled by
the Soviet Union. The North Korean armed
forces have steadily increased in strength and
quality since the Armistice.2 There has been
a gradual reduction in the Chinese Commu-
nist strength, and today the Chinese forces
constitute less than one-half of the Commu-
nist ground forces in North Korea.
North Korean Army
40. The strength of the North Korean army
(NKA) currently is estimated at 350,000 (esti-
mated at 281,000 at the time of the Armistice),
organized into three army groups composed
of six corps of 18 infantry divisions, plus seven
infantry brigades, eight tank regiments, and a
tank brigade of unknown strength and or-
ganization. Three corps and one division are
deployed in positions along the Demilitarized
Zone. (See map.) Three corps minus one
division and the seven infantry brigades are
deployed in the rear and coastal areas. The
Internal Security Forces under the control of
the Ministry of Internal Affairs, with a
strength of about 16,000 men, are equipped,
trained, and organized along army lines and
accordingly are included in the figure for
army strength. The manpower shortage
would probably limit the personnel strength
'Since the Armistice the Communist side has built
new airfields in North Korea and has brought in
jet aircraft and improved types of other weapons
not present at the time the Armistice went into
effect.
of the NKA during the period of this estimate
to about 375,000.
41. We consider the combat effectiveness of
the NKA fair. Substantial improvement in
organization, training, and standardization of
equipment has been achieved since the ter-
mination of hostilities in 1953. Moreover,
there have been significant improvements in
the transportation system and in organic unit
firepower. Most of the senior officers have
had combat experience and we believe that
leadership is good at the top level of command
and within the major subordinate units.
However, we believe that leadership is only
fair at lower levels, since most junior officers
and many of the front-line troops have had
little or no combat experience.
North Korean Air Force
42. The North Korean air force (NKAF) has
about 17,500 personnel and 525 aircraft in
the following categories:
Jet fighters (Fagots)
250
Jet ground attack (Fagots)
60
Jet light bombers (Beagles)
65
Piston fighters (not in operational units)
40
Piston ground attack (Beasts)
40
Piston light bombers
30
Transports
10
Miscellaneous aircraft
30
Only the jet aircraft are considered first line
equipment. The bulk of the strength of the
NKAF is deployed in a narrow corridor paral-
leling the west coast of North Korea and ex-
tending from Uiju to Pyongyang, and at Won-
san on the east coast. (See map.) The jet
and conventional light bombers of one air
division are based in Kungchuling, Manchu-
ria. North Korea has nine operational air-
fields and at least 22 other fields in varying
conditions of serviceability of which 12 can be
developed for jet use.
North Korean Navy
43. The North Korean navy consists of an esti-
mated 7,000 men and approximately 100 small
craft including 6-12 PT boats, 20 armed motor
launches, and eight wooden hulled ex-fishing
craft equipped for minesweeping. The remain-
RET
 der are wooden junks used for coastal patrol
or for rudimentary minelaying operations.
Chinese Communist Forces in North Korea
44. Since the Armistice the Chinese Commu-
nists have employed a rotation system com-
bined with a policy of gradual reduction of the
total Chinese strength in North Korea from
the high of 872,000 in 1953. Fourteen Chinese
Communist armies have been withdrawn since
1953, of which four were withdrawn in 1955.
The currently estimated strength of the Chi-
nese Communist Forces (CCF) in Korea is
about 290,000, organized into five armies (15
infantry divisions), two field artillery divi-
sions, one rocket-launcher division, three anti-
tank regiments, four AAA regiments, four
armored regiments and service troops. It has
three armies of nine divisions deployed along
the Demilitarized Zone and two armies located
in rear areas. Although many of the Chinese
Communist troops now in Korea have had
relatively little or no combat experience the
combat effectiveness, leadership, and morale
of the CCF in Korea are good.
Logistics
45. The transportation system in North Korea
has been rehabilitated. This has permitted
an improvement in supply procedures for the
armed forces including a reduction in large
forward stockpiles. The Chinese Communist
and North Korean logistic systems apparently
are linked and coordinated at the general
headquarters level. We believe that the Com-
munists are currently capable of logistically
supporting prolonged large scale military op-
erations in Korea.
46. The USSR furnishes the bulk of North
Korea's military equipment, particularly all
major ordnance items such as tanks, artillery,
and aircraft. Communist China has provided
light items such as clothing and individual
equipment, and the European Satellites have
furnished some medical supplies, electronic
and signal equipment, and some vehicles.
North Korean industry can partially fill the
requirements for small arms and small arms
ammunition, hand grenades and land mines,
and small naval craft of less than 1,000 tons.
Soviet Influence in North Korean Armed
Forces
47. Soviet influence is predominant in the
North Korean armed forces despite the par-
ticipation of large numbers of Chinese troops
in the Korean War and their continued pres-
ence in strength since the Armistice. This
dominance is reflected in the striking simi-
larity of the organization, logistics, and tac-
tics of the NKA to those of the Soviet ground
forces, in the continued reliance on the Soviet
Union as the major source of equipment, and
in the continued employment of Soviet ad-
visers at all important levels in all three serv-
ices. The preservation of Soviet influence is
facilitated by the fact that many Korean offi-
cers are in fact Soviet citizens, and in some in-
stances veterans of the Red Army.
Military Capabilities
48. The NKA is outnumbered almost two to
one by the ROK and is inferior in artillery
and heavy weapons, and its navy is consider-
ably inferior to the ROK navy. The NKAF,
however, has now become a modern combat
force which is numerically and qualitatively
superior to the ROKAF.
49. North Korean armed forces in concert
with the Chinese Communist forces now in
Korea are capable of launching a limited of-
fensive with little warning. The Chinese Com-
munists will continue to have the unopposed
capability to reinforce units in contact along
the demarcation line with a maximum of six
armies in from 10 to 14 days after the initia-
tion of movement from present assembly
areas. However, without external support,
the NKA is incapable of any sustained mili-
tary operations.
V. NORTH KOREA THROUGH 1960
50. It is unlikely that there will be a funda-
mental change in the regime's control and
leadership. Although the North Korean peo-
ple will probably continue to harbor extensive
grievances against the regime, these griev-
ances will have little effect on the regime's
firm internal control and stability. Nation-
alistic pressures for a modification of the re-
 gime's subservience to the USSR are likely to
be relatively slight. However, the USSR may
consider it desirable to give the North Korean
regime an appearance of greater independ-
ence, in part to enhance the North Korean
appeal in the South.
51. The USSR is likely to retain the allegiance
of North Korean leaders and its predominance
in North Korea during the period of this esti-
mate. Communist China probably will con-
tinue to make a substantial economic contri-
bution in North Korea, and her military forces
will continue to be available for the defense of
North Korea. Despite these factors and the
long history of Chinese suzerainty in Korea,
we believe that Peiping will not jeopardize its
over-all relationship with the USSR by seek-
ing to gain narrow advantage in Korea at the
expense of the Soviet position.
52. The Chinese Communists will probably
continue to reduce the strength of their forces
in Korea, and the chances appear about even
that they will complete their withdrawal with-
in the next year or so. An early and complete
withdrawal would be consistent with the
"peaceful" pose of the Bloc and the Commu-
nists might expect thereby to hasten the with-
drawal of all US/UN forces and possibly im-
prove the chances for subversion within the
ROK. The Communists probably realize, how-
ever, that their withdrawal would have much
less effect in generating pressures within
South Korea for similar US action than did
the unilateral Soviet withdrawal in 1948.
Moreover, the Chinese Communists may have
their own political reasons for wishing to
maintain some forces in North Korea, and the
USSR may feel that the North Korean armed
forces will not be sufficiently strong by the
end of another year to justify the withdrawal
of all Chinese troops.3
53. Although the Communists will probably
continue to press for negotiations on Korean
unification, they will almost certainly be un-
willing to make any concessions which would
weaken their firm hold on North Korea. They
would almost certainly accept serious risks to
maintain the North Korean regime and to
retain control of North Korea. On the other
hand, the Communists almost certainly esti-
mate that repetition of their attack on South
Korea would lead to strong US/UN military
counteraction, and they will probably con-
tinue unwilling to take significant risks to
obtain control of the South. We believe that
so long as the US remains committed to the
defense of the ROK, another Communist at-
tack against South Korea is highly unlikely.
54. The Communists will continue their overt
and covert attempts to undermine the ROK,
and at the same time bend all efforts to
strengthen the international position of the
North Korean regime. They will continue to
exploit the desire of all. Koreans for political
unity by attempting to appear as the cham-
pions of peaceful political unification, by call-
ing for "Korean" measures to bring about
unification, and by portraying ROK leaders
and the US as the main stumbling blocks to
these aspirations. They will probably increase
their appeals to South Koreans for economic,
political, and cultural contacts. The Com-
munists probably do not expect success in
their efforts at unification during the lifetime
of President Rhee, but they probably estimate
that political uncertainty and weakness will
develop following his death. They may also
believe that the US interest in Korea will grad-
ually decline. In either of these situations
their unification tactics are likely to be accel-
erated and much more effective.
The Special Assistant, Intelligence, Department
of State, believes that the factors impinging on
a Chinese Communist military withdrawal from
Korea are so uncertain as to make it impossible
to estimate that the chances are about even that
complete withdrawal will occur within the next
year or so. Although such a move would con-
form with the Communists' current "peaceful"
pose, such factors as Chinese Communist interest
in maintaining influence in North Korea, Chinese
Communist commitment of military labor in
Korea as a contribution to North Korean rehabil-
itation, possible Soviet uneasiness about the
strength of the North Korean forces at this stage
of development, and the desirability of timing a
military withdrawal in such a way as to gain
maximum political advantage may militate
against complete withdrawal in the immediate
future.
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KOREA
NORTH KOREA
Troop Disposition
and Airfields
? NKAF airfield
in operation
CCA/NKA unit
NOTE: Although 6 CC armies
are shown in North Korea, only
5 armies are accepted; one of
the armies (unidentified) with-
drew during 1955.
- - Railroad (Selected)
Road (Selected)