CURRENT INTELLIGENCE BULLETIN - 1953/08/04

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02020902
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 7
• Document Creation Date: July 15, 2019
• Document Release Date: July 22, 2019
• Publication Date: August 4, 1953

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SE i INFORMATION
4 August 1953
Copy No. 67
CURRENT INTELLIGENCE BULLETIN
DOCNNT NO.
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REVIEWER
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Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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INFORMATION
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SECURITY INFO
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SUMMARY
FAR EAST
1. British official warns of possible retaliation for Chinese Nationalist
harassment of shipping (page 3).
SOUTHEAST ASIA
2. Further economic deterioration and civil disorders foreseen in
Indonesia (page 3).
NEAR EAST - AFRICA
by! Iranian prime minister makes violent attack on US policy (page 4).
4.
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5. Little progress achieved in initial Anglo-Egyptian contacts (page 5).
6. Libyan king reportedly seriously ill (page 6).
WESTERN EUROPE
0/Austrian leaders favor dropping short treaty draft (page 6).
8. Comment on Piccioni's prospects for forming new Italian
government (page 7).
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ECURITY INFORMATION
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FAR EAST
I. British official warns of possible retaliation for Chinese Nationalist
harassment of shipping:
The British consul in Taipei, in conversation3.3(h)(2)
with a US embassy officer, warned of possible
retaliation against Chinese Nationalist shipping
in Hong Kong and Singapore for recent increased
harassment of British ships by Nationalist naval
vessels. The Nationalist measures have Included the revocation of
entry permits to Formosan ports for several British vessels.
Comment: Continued British participation
in the mainland trade has been responsible for a deterioration in Chinese
Nationalist-British relations in the past month. On 23 July, for the first
time since the Korean war began, a British warship clashed with three
Nationalist gunboats to rescue a British coaster intercepted in the For-
mosa Straits, On 29 July, according to a press report from Hong Kong,
another British coaster was fired on and intercepted near Foochow.
SOUTHEAST ASIA
2. Further economic deterioration and civil disorders foreseen in Indonesia:
The American embassy in Djakarta believes3.3(h)(2)
that the new Communist-influenced cabinet will
pass measures seriously damaging the Indo-
nesian economy and likely to increase civil
strife.
The embassy foresees that the government
will not take severe measures against Communist armed groups, will
permit the sale of rubber to Communist China, may terminate American
aid and take increasingly antagonistic moves against foreign industry.
Comment: Past performance of the Communist-
National Party bloc indicates that the cabinet very likely will introduce the
policies mentioned by the embassy.
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Leaders of the Masjumi, the chief opposition
party, reportedly are planning a strongly anti-Communist propaganda
campaign. Many army and police officials are known to oppose the
cabinet, and the Indonesian press also is generally dissatisfied with
the new government.
NEAR EAST - AFRICA
3. Iranian prime minister makes violent attack on US policy:
4.
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According to Prime Minister Mossadeq's son,
Dr. Gholam Mossadeq, the prime minister
considers the effect on Iranian public opinion
of President Eisenhower's letter to be worth
$50,000,000 to the Soviet Union.
In a conversation with US embassy officers
on 1 August, Gholam insisted that the people were disgusted to find
the United States "so brazenly behind the British," and he insisted
that America's "stupid diplomacy" alienated the only pro-American
group in Iran, the middle class led by his father.
Comment: Mossadeq appears to be re-
assessing his policy toward the United States. This may be warning
that an open anti-American campaign will result from a continued US
refusal to aid Iran.
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5. Little progress achieved in initial Anglo-Egyptian contacts:
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Egyptian foreign minister Fawzi, in corn- 3.3(h)(2)
menting to Ambassador Caffery on the in-
formal contacts which have been established
with British spokesmen, stated: "I was not
left with much optimism." Fawzi pointed out that these contacts were
used by the Egyptians to improve the atmosphere and did not touch on
the details of the points at issue.
The question of future availability of the
base reportedly was the only point discussed.
Comment: Vice Premier Nasr confirmed
to an official of the American embassy that initial contacts with the
British hardly touched on substantive matters and declared that the
atmosphere was "not bad." He expressed concern lest the British
make the mistake of thinking that the Egyptians are bluffing in their
demands.
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6. Libyan king reportedly seriously ill:
King Idriss reportedly is seriously ill,
according to American charge Summers
in Tripoli. Summers states that Prime
Minister Muntasser requested that a doctor
be sent from Wheelus Airbase to the monarch in Benghazi.
3.3(h)(2)
The charge points out that while the serious-
ness of Idriss' rumored illness is not yet known, the king's condition
has caused some discussion of a possible successor.
Comment: Since he has no male heir, the
king's death would bring serious confusion to a state which has faced
political and economic difficulties since its establishment in December
1951. Any successor would have even less prestige than Idriss and
would probably find his leadership contested in the country's three
provinces.
The king's death could set back the progress
already made on the Western base agreements, particularly the Anglo-
Libyan pact.
WESTERN EUROPE
7. Austrian leaders favor dropping short treaty draft:
Leaders of the Austrian coalition parties
told Ambassador Thompson on 1 August
that in their opinion the West should now
drop the abbreviated draft treaty and try
to get the USSR into substantive negotiations in which the Austrians
would participate.
Chancellor Raab stated that he is hoping
for an international loan which would enable Austria to meet its
obligations under the long draft. On the neutrality issue, Foreign
Minister Gruber observed that Austria might declare its willingness
to forego membership in military pacts; this alone, he believes,
would not mean "neutralization."
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Comment The French and the British
have long shared Austria's hesitancy toward US tactical support of
the short treaty, and the 30 July Soviet note and recent Soviet "con-
cessions" have apparently gone far toward convincing the Austrians
that the prospects are good for a treaty.
Reported statements by Austrian Communists
that the Soviet Union is prepared for bilateral settlements with the
Austrians on various treaty issues, including the oil assets, are prob-
able intended to fan these hopes further and increase Western alarm
over the independent attitude of the Austrian government.
8. Comment on Piccioni's prospects for forming new Italian government:
Italian premier-designate Piccioni, vice
premier under De Gasperi, faces considerable opposition within his
own Christian Democratic Party and appears unlikely to be able to
form a stable government.
The Christian Democratic left wing, which
controls about two thirds of the party's 263 seats in the 590-seat
Chamber of Deputies, opposes him because of his rightist views, his
championship of collaboration with the Monarchists, and his preference
for close cooperation with Catholic Action. The left wing has already
threatened to split off if the party allies itself with the Monarchists,
who control 40 seats in the chamber. Its leader Taviani in particular
has strongly warned against a continued government drift to the right
in the face of a clear popular electoral trend to the left.
Furthermore, even the Liberal Party, the
most conservative of the three minor democratic parties, is, in view
of its anticlericalism and the gains of its anti-Monarchist wing in the
7-8 June elections, unlikely to give full support to a Piccioni cabinet.
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