NATIONAL INTELLIGENCE DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP67-00059A000100010002-7
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 261
• Document Creation Date: December 16, 2016
• Document Release Date: August 9, 2005
• Sequence Number: 2
• Content Type: REPORT

Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET
NATIONAL INTELLIGENCE DIGEST
CENTRAL INTELLIGENCE AGENCY
TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET INTRO-A
Page 1 of 1
INTRODUCTION
PURPOSE AND SCOPE
The National Intelligence Digest is intended to serve as a
summary of intelligence on major world problems for the use of
government officials. Users of the Digest should be aware that
it is not designed to provide complete and up-to-the minute
current intelligence. The country handbooks published by the
Office of Current intelligence provide this type of information
in considerable detail. Moreover, the Digest does not provide
a compilation of National Intelligence Estimates, but rather is
a collection of generalized abstracts of such estimates. The
Digest will be revised monthly to take account of major current
developments and to include abstracts of the latest pertinent
National Intelligence Estimates. The date at the bottom of each
page indicates the cut-off date for the information contained on
that page.
SOURCE
The Digest is. not an LW-coordinated publication. Where
National Intelligence Estimates are abstracted, the source Will
be clearly indicated in a footnote. CIA assumes sole responsi-
bility for this abstracting as well as for all other material.
CLASSIFICATION
This Digest as a whole is classified TOP SECRET and each page
is so marked. Individual sections in many cases have lower
classifications, which are shown under the title on the first page
of the section. The lower classification may be employed if the
material is separated from the Digest_
Copy No.
Approved For Release 200?ThriAtiftelA-RDP67-000591A6401606-1;6602-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET
TABLE OF CONTENTS
I. GENERAL
INTRO-B
Page 1 of 3
No. of Date of
Pages Information
A. Estimate of the World Situation through
1955 (10) 10 Dec 53
B. Probable Effects of Increasing Nuclear
Capabilities upon the Policies of US
Allies ? . . (2) 1 May 54
C. Probable Development of the Soviet Bloc
and Western Power Positions over the
Next Fifteen Years........?.... (5) I May 54'
II.
SOVIET BLOC
A. Soviet Capabilities and Probable Courses
of Action through Mid-1959
B. Communist China. 000000000 goe000afee 00000000
C. The European Satellites
D. Soviet Bloc Economic Warfare Capabilities
and Courses of Action (Discontinued)
E. Review of Current Communist Attitudes
toward General War
F. Probable Soviet Response to the Ratifi-
cation of the Paris Agreements
(13)
(6)
(5)
(3)
(4)
1 Apr 55
1 Apr 55
1 Apr 55
28 Feb 55
1 Apr 55
III.
FAR EAST
A.
Communist Courses of Action in Asia
through 1957
(4)
1 Apr 55
B.
Strategic Resources of the Far East
(Discontinued)
C.
Korea
(4)
1 Apr 55
D.
Japan
(4)
1 Apr 55
E.
Taiwan
(5)
1 Apr 55
F-1
Mainland Southeast Asia (Discontinued)
F-2
Indochina
WC,
1 May 55
F-3
Burma
(2)
1 Apr 55
F-4
Malaya
(1)
1 Oct 54
F-5
Thailand
(4)
1 Jan 55
G.
Australia
(1)
1 Jun 54
H.
New Zealand (Discontinued)
I.
The Philippines. ......... ..........
(3)
1 Apr 55
Jo
Indonesia
(3)
1 Apr 55
K.
Hong Kong and Macao (Discontinued)..........
TOP SECRET
Copy No.,
1 May 3.95
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
INTRO-B
Page 2 of 3
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOT SECRET
IV.
V.
VI.
SOUTH ASIA
Introduction (Discontinued)
A. India
B. Pakistan
C. Kashmir Dispute
D. Afghanistan. .. . so 0.-?
E. Ceylon.. OOOO 000.00000 OOOOOOO 000109009 OOOOOO 0
MIDDLE FAST AND AFRICA
V. Middle East Defense
A. Iran. OOOO 00000 OOOOOOOOO 0000 OOOOO o00 OOOOO 000
B-1 Arab States.. 0000000000 OOO ; OOOOOOO 000000000
B-2 Egypt...... OOOOOOOOOOOOOOOOOO ... OOOOOO 00000
B-3 The Sudan
B-4 Syria
B-5 Lebanon
B-6 Iraq
B-7 Jordan
B-8 Saudi Arabia
B-9 Libya. .. OOOOO . OOOOO 000 OO 0 OO 0 OOOOO 0000000000
C. Israel
D. Turkey
E. Middle East Oil (Discontinued)... 000 OOOOOOO
F. North Africa
G. Union of South Africa ... OOOOOOOOO 00000.0000
H. Tropical Africa
I. Greece.. . OOOOOOOOOOOO ............. OOOOOOOOO
EUROPE
A. The Outlook for Western Birope over the
Next Decade
B. Status of the NATO Defense Effort
C. Status of the Western European Economy
D. Status of European. Integration...........
No. of
Pages
Date of
Information
25)05
25X6
(3)
(4)
(1)
(3)
(2)
(1)
(4)
(2)
(3)
(2)
(2)
(1)
(2)
(1)
(2)
(2)
(3)
(2)
(5)
(3)
(3)
(4)
(2)
(2)
(3)
(2)
1 Apr 55
1 Apr 55
1 Apr 55
1 Dec 54
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Oct 54
1 Apr 55
1 Apr 55
1 Apr 55
1 Nov 54
1 Oct 54
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Jul 54
28 Feb 55
1 may 54
1 Nov 54
1 Jan 55
1 Nov 54
F. France
(4)
1 Apr
H. West Berlin
Saar
J. The German Unity Issue (Discontinued)
K. Italy
L. Trieste (Discontinued)
M. Austria.... OOOOOOOOOOOOO ? OOOO ! OOO .000000000
(1)
(2)
(4)
(4)
1 Apr
1 Apr 55
1 Dec 54
1 Apr 55
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
'TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET INTRO-B
Page 3 of 3
VI. EURDPE (Continued)
N-1 Benelux Countries
N-2 Belgium
N-3 Netherlands
N-4 Luxembourg
0. Switzerland (Discontinued)
P. Scandinavia
P-1 Norway
P-2 Denmark
P-3 Sweden .. OOOOOOOOOOOOOOOOOO
1)-4 Finland
Q. Iceland
R. Portugal
S. Spain ..
T. Yugoslavia.
No. of
Pages
Date of
Information
(1)
(I)
(1)
(I)
(1)
(2)
(2)
(3)
(2)
(1)
(3)
(4)
1 Apr 55
1 Apr 5.5
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
I Apr 55
1 Apr 55
1 Apr 55
VII. LATIN AICA
A. Over-all Situation
B. Argentina
C. Bolivia,
D. Brazil
E. Chile
F. Colombia..
G. Caribbean Republics
H. Guatemala
I. Panama (Discontinued)
J. Venezuela
K. The European Dependencies in the
Caribbean Area
(1)
(3)
(3)
(4)
(3)
(2)
(6)
(3)
(3)
(2)
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
1 Apr 55
I Apr 55
I Apr 55
TOP SECRET
Copy No f"..3_
I May 19
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 .? CIA-RDP67-00059A00010001000277
TOP SECRET A -
ESTIMATE OF THE WORLD SITUATION THROUGH 1955*
(SECRET)
SCOPE
This estimate is concerned with the major international trends which
will affect the world situation through 1955 rather than with the specific
events and conditions which will characterize that situation. The esti-
mate must assume a continuation of present US policies and thus cannot
consider the effects which a change in these policies would have on the
world situation.
ESTIMATE
The Over-All Situation Through 1955
Despite the change in regime in the USSR and the shifts in Soviet
foreign and domestic tactics, there has been no change in the USSR's
basic hostility to all non-Soviet power. The USSR will continue its cold
war against the Free World, largely through a vigorous political warfare
campaign. While East-West negotiations are possible, there is little
likelihood of any major Soviet concessions.
On the other hand, we believe that deliberate initiation of general war
by the USSR is unlikely during this period,** and, to the extent that the
USSR pursues a more cautious policy, the chance of war by miscalcula-
tion will also probably be less. However, there will be continuing danger
that it may occur from a series of actions and counteractions initiated by
either side, but not intended by either side to have that result. In par-
ticular it might arise from actions by one side that were regarded by the
other as an imminent threat to its security. There will also be a con-
tinued danger of new or intensified East-West clashes, particularly in
Indochina, and Korea, and of incidents in Germany.
In the absence of such East-West clashes, and unless the USSR aban-
dons its ostensibly conciliatory tactics, the next two years will probably
be a period of reduced Free World apprehensions of general war. So long
as this period lasts it will present a new challenge to the Free World.
While over the longer run the very diversity of the Free World may lend
it a flexibility and potential for growth which will constitute a source of
strength, over the next two years this diversity may prove a source of
weakness. The totalitarian nature and centralized controls of the Soviet
Bloc might give it advantages in this phase of the cold war, even though
the totalitarian rigidities of the Bloc system might over the longer run
* This chapter contains the complete text of NIE-99, "Estimate of the World
Situation Through 1955" (23 October 1953).
** The Deputy Director for Intelligence, The Joint Staff, considers that the in-
telligence available is insufficient to permit a judgment, of Soviet capabilities
or intentions, sufficiently accurate to justify the conclusion that:
"Deliberate initiation of general war by the USSR is unlikely during this
period."
MO RI 39792 PAGES 1.:24 Tokv sxcR_ET
Approved F-or Release 2005/08/15 : CIA-RDP67-00ARegalE0488b2-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1-2 TOP SECRET
impair its stability and cohesion. Continued stresses and strains within
the Soviet Bloc are likely, but the monolithic unity and forced cohesion
of the Bloc will probably be much less affected by a situation of reduced
apprehensions than the more divided Free World. Moreover, the build-
up of Bloc strength will almost certainly continue, even if at a somewhat
reduced rate, while the Free World may be inclined to relax its guard.
We believe that in a situation of reduced international apprehensions
and Bloc emphasis on divisive tactics, there is danger of a weakening in
the unity of the Free World.
The progress being made by the USSR in the development of nuclear
weapons is also a factor of prime military and psychological importance
in the world situation. As this Soviet capability increases, Western
superiority in numbers of nuclear weapons will be of relatively less sig-
nificance so far as the psychological factor is concerned. As the USSR
increases its capabilities for delivering a seriously damaging attack on
the US, the US is losing the unique position it has held in the East-West
struggle. The full impact of this development is not yet clear, but even
now we perceive two new elements:
a. One is the danger that the USSR may use threats of atomic bom-
bardment against certain Free World countries in an attempt to force
their compliance with its demands. There is a chance that some US
allies, if they feared that the threat of US retaliation would not deter
Soviet action, would be forced by the prospect of atomic devastation to
adopt more neutral positions in a cold, or especially in a hot, war.
b. In an age where initial air assault can be so destructive, the US is
losing, if it has not already lost, the immense advantages of being able
to conduct a deliberate and extensive post D-day mobilization with rela-
tive freedom from enemy attack.
Probable Trends in Soviet Bloc Cohesion, Strength, and Policies
Cohesion of the Bloc. Despite the possibility of a disruptive struggle
for power within the new Kremlin leadership and the evidence of popular
disaffection within the Satellites, we believe the Bloc will preserve its
cohesion through the period of this estimate, and that the Kremlin will
continue to play the dominant role in the formulation of Bloc policies.
We believe that the USSR and Communist China will remain closely allied
during the period of this estimate.
Bloc Capabilities. The build-up of Bloc basic industry and military
capabilities will continue even though increased attention will be devoted
to the correction of certain economic deficiencies in agriculture and con-
sumer industries which recently have been specially emphasized. There
are indications that the Soviet authorities intend to proceed along the
lines laid out in the announced plans for these sectors of the economy.
This would require an allocation of greater resources to agricultural and
consumer goods production and, at least for the short run, would lead
to a reduction in the rate of expansion of other sectors of the economy.
The most significant increase in Bloc military capabilities during the
period of this estimate will arise from enlargement of the Bloc stockpile
of nuclear weapons (and the addition of a thermonuclear component) ,
and from an increase in the number of its jet aircraft and its submarines.
AM3rW681VberrRgiase 2005/0a6P: EW-MCF67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET 1-3
The Bloc may by mid-1955 have available a sufficient number of heavy
bombers to increase greatly its long-range air offensive capabilities. The
Bloc will probably increase its air defense capabilities, and may have a
limited number of all-weather jet interceptors in operational units. We
do not believe that marked changes in Bloc military strength and capa-
bilities are likely to occur in other respects; however, there will be a
general improvement in training and equipment of Bloc armed forces.
Bloc political warfare capabilities, through exploitation of Western
political and economic vulnerabilities, encouragement of anti-Westernism
and nationalism in underdeveloped countries, and utilization of the
world-wide network of Communist parties, will remain great.
Probable Bloc Policies.*** We believe that the Communist rulers re-
main profoundly convinced that permanent hostility exists between the
Communist and the free worlds. Their basic objectives, therefore, con-
tinue to be an expansion of their own sphere of power and the eventual
domination of the non-Communist world.
We believe that during the period of this estimate Bloc leaders will try
to avoid courses of action which in their judgment might involve sub-
stantial risk of general war. We also believe it unlikely that the Bloc
will initiate new local aggressions with identifiable Bloc forces during the
period of this estimate, since the Communist leaders probably estimate
that virtually any new local military aggression would now entail sub-
stantial risk of general war or political consequences adverse to Bloc
interests.
It is always possible, of course, that the Kremlin will deem some act
of local armed aggression sufficiently advantageous to make the risk
worth while. Moreover, despite its reluctance to run substantial risks of
general war, the Kremlin might through miscalculation adopt some
course of action involving such a risk. We also believe that the Kremlin
would not be deterred by the risk of general war from taking counter-
action against a Western action which it considered to present an immi-
nent threat to Bloc security.
During the period of this estimate the Communist leaders will conduct
a vigorous political warfare campaign to undermine the Western power
position. At present the Kremlin seems to be trying to give the im-
pression that it has adopted a more conciliatory policy than that fol-
lowed in Stalin's later years. The Kremlin may hope by such tactics to
relax the vigilance of some Western states, to encourage dissension be-
tween the US and its allies, and to delay the progress of Western rearm-
ament. We cannot predict how long such comparatively conciliatory
tactics will continue; we believe that harsh courses of action similar to
those pursued by the Kremlin in the past will reappear whenever the
Kremlin deems them advantageous.
We believe that Bloc leaders during the period of this estimate will
probably be prepared to reach an accommodation on some minor ques-
tions, and may make plausible but unacceptable proposals on major
matters. However, they will almost certainly be unwilling to settle any
*** The material in this section is taken from N1E-95, "Probable Soviet Bloc
Courses of Action Through Mid-1955," 25 September 1953.
ber 1953
Approved For Release 20M8/VC: IgAr-RDP67-00H9R8000010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1-4 TOP SECRET
East-West differences at the cost of major concessions. We believe, more-
over, that the Bloc leaders will be extremely cautious in pursuing con-
ciliatory tactics, and may revert from time to time to demonstrations of
toughness, especially when they consider that their vital interests are
involved, or that their tactics are being construed abroad as a sign of
weakness. Offers to negotiate may be accompanied by reminders that
the USSR now has improved capabilities in the nuclear weapons field,
and as these capabilities further increase, the Kremlin may become
bolder in its dealings with the West.
There are recent indications that the Bloc intends to increase its trade
with non-Communist states. The Bloc's volume of trade with the Free
World will probably increase somewhat during the period of this esti-
mate, but this trade will continue to be very small in proportion to intra-
Bloc trade. New trade agreements will probably be intended not only
to obtain desired imports but also to weaken the economic ties of non-
Communist states with the US, and to make strategic trade controls a
bone of contention between these states and the US. While the Bloc
will not be able to bring about a major shift in present trade patterns,
the Communists probably estimate that political dividends can be earned
from even small increases in their current volumes of trade with indi-
vidual non-Communist states.
Probable Developments in the Free World
During the next two years the Free World will have difficulty in main-
taining its strength in the face of Soviet divisive tactics and probable
reduced apprehensions of East-West conflict. In contrast to the Krem-
lin's ability to control or influence the close-knit Soviet Bloc, the US, as
leader of the anti-Soviet powers, faces the complex problems of dealing
with the loose anti-Soviet coalition and the agglomeration of other na-
tions of varying neutral tendencies which together make up the Free
World. To many of this latter group, particularly the Middle and Far
Eastern countries, the East-West struggle seems less important than the
solution of their internal problems and the assertion of their independ-
ence of the chief Western Powers.
Differing views also exist between the US and its allies over the immi-
nence of the Communist threat. The very fact of Communist aggression
in Korea increased fears of general war and was a prime factor in stimu-
lating Western rearmament. Now that many Free World countries be-
lieve that the threat of war has been reduced by a Korean armistice and
by an ostensibly more conciliatory Soviet policy, the US will have greater
difficulty holding together an anti-Soviet coalition and in securing in-
creased Free World armed strength. The levelling off of the US's own
rearmament effort and the decline in many of its foreign aid programs
also lessens the sense of urgency abroad.
The apparent decline of Free World confidence in US leadership is
another problem facing the US. Influential groups in many Free World
countries, including several US allies, doubt the stability, moderation,
and maturity of US policy. On the one hand, there is fear the US will
shift to a "go-it-alone" policy or even retreat to isolationism, on the other
that the US will involve the Free World in war. These doubts and fears
AN3rT8M4b8F ligase 2005/0gRf:lig367-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET 1-5
offer a fertile field for Soviet divisive tactics, and the new Soviet regime
may be more successful than Stalin in exploiting them.
In a situation in which many Free World countries believe that the
threat of war has been reduced, economic problems will also assume
greater prominence and will test the strength and cohesion of the Free
World. This reduced apprehension will weaken what has been a power-
ful incentive to cooperation and sacrifice. Moreover, some readjustment
to a reduced rate of rearmament and declining US aid will be necessary.
Much will depend on US economic policies and the US economic situation.
Not only would US economic setbacks have a serious impact on the Free
World, but US trade policy will directly affect the economic health of
Free World countries, and US aid will remain in many cases an important
element in their military build-up, economic stability and development,
and political orientation. The problem of East-West trade is also likely
to become more troublesome.
Therefore, we believe that in the absence of renewed Soviet provocation,
there may develop further serious rifts between the Free World nations
which will weaken the Western position in the cold war. Such rifts may
develop in any case as a result of economic developments or local nation-
alist pressures but reduced apprehensions of war, combined with skillful
Soviet divisive efforts, would make them even more serious. The most
troublesome differences may arise over policies to be pursued in the Far
East. It is possible, therefore, that the next few years might see an
increasing isolation of the US, not by its own desire but because of in-
creasing policy differences between it and other countries of the Free
World.
Even assuming the continuation of the Soviet courses of action pro-
jected above, there remains a serious danger of new or widening East-
West clashes in such critical areas as Indochina, Korea, and Germany,
which would again increase Free World apprehensions. Whether, if such
clashes took place, the Free World would then rally to the support of the
US and of expanded rearmament programs, as after the Korean aggres-
sion, would probably depend at least in part on the circumstances under
which the clashes developed.
Probable Developments within the NATO Coalition
Although we foresee no developments which will undermine the basic
solidarity of the NATO alliance, we believe that, in view of reduced Euro-
pean apprehensions of East-West conflict, rifts may develop between the
NATO partners, particularly between the European NATO countries and
the US. The USSR will attempt to undermine popular support for the
NATO alliance and for rearmament, in particular the program to rearm
West Germany. These efforts, together with increased Soviet nuclear
capabilities, continued intra-European differences, and European disa-
greements with the US over cold war policies, may lead to more nation-
alist and neutralist attitudes in Western Europe.
So long as apprehensions remain reduced there also will almost cer-
tainly be a further loss of momentum in the NATO build-up. The gen-
eral feeling that the immediate Soviet threat has receded has already led
most NATO countries to reduce their military outlays. While a further
TOP SECRET 10 Decembies 1953
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1-6 TOP SECRET
slow increase in NATO strength over the next two years is probable, only
in event of renewed Soviet aggressiveness will it be as rapid as in 1950-
1953. On the other hand this might allow many NATO countries to
concentrate on domestic needs and to devote more resources to meeting
their own social and economic problems. Such a trend might strengthen
countries such as the UK, which remain highly vulnerable to adverse
international economic developments.
Significant increases in European NATO military strength over the
coming period will probably depend upon the extent to which Spain,
Yugoslavia, and above all West Germany can be directly or indirectly
associated with NATO. The Trieste issue will remain an irritant in Italo-
Yugoslav relations which will render the association of Yugoslavia with
NATO difficult. Until a settlement of the Trieste issue is generally
accepted, the usefulness to NATO of the Greek-Turkish-Yugoslav entente
will be impaired.
But above all, the prospects for greater European NATO strength and
cohesion will revolve increasingly around the interlocking problems of
Germany's future and the attitude of France. As a result of Soviet
failure to come forward with any acceptable reunification scheme and
of Adenauer's overwhelming victory, the chances for integrating West
Germany with the Western Powers and for initiating its rearmament
have increased. The Kremlin may seek to avert or postpone these devel-
opments by renewed talk of German reunification, but it is unlikely to
offer any terms which would jeopardize its control over East Germany.
Adenauer's position is so strong and German disillusionment with Soviet
unification offers is so great that any Soviet offers not involving aban-
donment of Soviet control over East Germany would be unlikely to have
much impact on German opinion. The importance attached by the
Soviet rulers to West German rearmament is such, however, that they
might react to it by measures which would enhance the risk of an East-
West clash in this area. A likely pressure point would be West Berlin.
Though many in France are aware of the need for strong government,
there is no evidence that this awareness will lead to a stronger French
political system.
ArlOrkalPIFRaase 2005/08FRP: 86C-Rg67-00059A000100010002-7
25X1
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A00010001100102-7
TOP SECRET
Probable Trends in the Far East
In the last two years the most active theater in the East-West struggle
has been in the Far East. There the Western Powers have kept the Com-
munists from overrunning South Korea and Indochina while attempting
to build up anti-Communist strength through US support of the non-
Communist countries in this area. We believe it unlikely that the Com-
munists will undertake new local aggression in the Far East with identi-
fiable Bloc forces. The emphasis in Communist China over the next two
years will probably be on building up industrial and military strength.
However, we believe that the Communists would take counteraction
against Western actions which they felt presented an imminent threat
to their security, even at the risk of widening hostilities in the Far East.
It will be difficult to increase the strength, cohesion, and anti-Com-
munist orientation of the non-Communist states of the Far East. The
cessation of hostilities in Korea, together with Communist efforts to pro-
mote rifts among the anti-Communist powers, will add to this difficulty.
During the next two years there is unlikely to be any significant improve-
ment in the Western position in this area; moreover, there are possibili-
ties of serious deterioration, particularly in Indochina, Indonesia, and
Korea.
Korea. A Korean political conference, if it takes place, is unlikely to
result in any agreement which would alter the status quo. The Commu-
nists are unlikely to break the armistice by renewing hostilities, but they
almost certainly will not agree to Korean reunification on terms which
would endanger their control of North Korea. On the other hand, if
President Rhee remains convinced that the US could neither prevent an
ROK armed attack against the Communists nor disassociate itself from
military support of such action, once undertaken, we believe that he
will probably at some time seek to disrupt the armistice by such an
attack. If hostilities are renewed, the Communists will probably take, at
a minimum, the military measures they consider necessary to maintain
their position in Korea. Unless the ROK renews hostilities, we believe
that there will be a continued armed truce in this area, with both the
US and USSR engaged in reconstruction and in strengthening their re-
spective Korean partners.
Taiwan. Any major change in the status of Taiwan is unlikely. The
Communists probably will not attempt invasion so long as the US de-
fends Taiwan; and unless the US decides to support Chiang's forces
directly, he in turn will be unable to undertake more than minor harass-
ment of the mainland.
Indochina. We believe that there will almost certainly be important
developments in the Indochina situation during the period of this esti-
mate. The steady deterioration of France's will to continue the struggle
has been at least temporarily checked by French resumption of the initi-
ative under the Laniel-Navarre plan. We do not believe, however, that
the French will achieve a complete military victory. The French objec-
tive is to reduce the drain of the Indochina war on France, while main-
10 December 1953
Approved For Release 200Kg1g .VEZIDP67-00059A000100010002-7
Apnved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET
taming a position for France in the Far East. The outcome will depend
on whether, by a combination of military victories and political conces-
sions, the French can strengthen the Associated States to the point where
these states will be able to maintain themselves against Communist
pressures with greatly reduced French support. The French would hope
in this way to create a situation which could serve as a basis for successful
negotiations with the Communists. The Laniel-Navarre plan may be
the last French effort in Indochina. Should it fail to achieve its objec-
tives we believe that, unless the US proves willing to contribute forces,
the French will in time seek to negotiate directly with the Communists
for the best possible terms.
For their part, the Chinese Communists will almost certainly continue
their present type of support for Viet Minh. They are unlikely to inter-
vene with organized units, at least in the absence of Western moves
which in their opinion threatened the security of Communist China. At
the same time, the Communists will probably talk of peace negotiations
as part of their propaganda campaign and might raise the Indochina
issue in high level political conferences. They are unlikely, however, to
agree to any political settlement which they believe would lessen their
chances of eventually gaining control of Indochina.
Other Countries of Southeast Asia. Problems facing the other South-
east Asian countries are those of attaining political stability, coping with
local insurrections, and meeting their own serious economic problems.
The outlook in the Philippines, and in the absence of serious deteriora-
tion in the Indochina situation, in Burma, Thailand, and Malaya, is for
some improvement in stability, though these countries will by no means
resolve their numerous internal problems. In Indonesia, however, the
leftist character of the present government offers increased opportunities
for Communist penetration,
Japan. Accumulating economic difficulties and the reluctance or in-
ability of the Japanese Government to adopt energetic economic and
rearmament policies are prolonging Japanese dependence on the US and
delaying Japan's development as a counterweight to Communist power
in the Far East. At the same time there is growing anti-American senti-
ment in Japan. Unless Japan can find the necessary foreign markets
and take the necessary internal economic measures, the development of
a sound defense structure as well as a sound economy will be endangered,
the present dominance of the moderate conservatives will be weakened,
and the whole pattern of US?Japanese cooperation will be threatened.
We foresee no basic change in Japan's pro-Western orientation, but eco-
nomic difficulties and growing nationalism will create increased US?
Japanese frictions and postpone the development of a strong anti-Com-
munist Japan.
Prospective Trends in the Middle East, Africa, and South Asia
In the underdeveloped areas of Asia and Africa the Western position
has deteriorated since World War II. Local nationalism has proved a
force against the West and the deep-seated revolutionary forces at work
in these areas have created political instability. It is difficult to over-
come the anti-Western sentiments of the newly independent Asian and
African countries and convince them that Communist policies threaten
/11?3139asiaipcir Wiase 2005/698 ERik6P67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET 1-9
their independence. Except in Iran, however, the internal Communist
threat is small and is unlikely to grow greatly in the next two years.
The Middle East and North Africa. Conflicts between native nation-
alists and the "colonial" powers will continue, but we believe that in
certain areas there are prospects for improvement in the West's position.
The fall of Mossadegh in Iran has at least temporarily increased the
opportunities for strengthening Iran's internal stability and settling the
Anglo-Iranian oil dispute. Chances for settlement of the Anglo-Egyptian
base controversy have improved, and if a settlement is reached it will
probably have a favorable effect on both the stability of the Egyptian
regime and on the Western position throughout the Arab World. On
the other hand, an Anglo-Egyptian settlement may set the pattern for
similar demands from Iraq. The Arab?Israeli dispute will continue, but
a renewal of large-scale hostilities remains unlikely in view of the near
military equilibrium of the two parties, and the restraining influence of
the US, the UK, and France. The more favorable policy that the US has
adopted toward the Arab States may contribute to better relations with
them. However, there remain possibilities of markedly adverse develop-
ments in this volatile area. Although the deposition of the Sultan of
Morocco has temporarily bolstered French control, it is likely to drive
the nationalists to more extreme positions since France seems unlikely to
implement very far-reaching reforms.
South Asia. India and Pakistan will probably remain preoccupied
with their own serious economic and social problems; they will also
remain concerned with their dispute over Kashmir. India is unlikely to
abandon its neutralist position in the cold war, but Pakistan, motivated
largely by its desire to improve its position vis-a-vis India, will continue
its efforts to secure some pact with the Western Powers, in return for
extensive US aid. Some further improvement in the relations of this
area with the West may occur over the next two years, but they will
remain acutely sensitive both to anti-colonial disputes in other areas and
to any indications that the West is pursuing aggressive cold war policies,
particularly against Communist China.
Probable Trends in Latin America
There will probably be a continued trend in Latin America toward
extremely nationalistic regimes based on demagogic appeals to sectors of
new political importance ? organized labor, white-collar workers, and
the lower middle class. This trend will be most evident in countries
where rapid social and economic change is taking place. This change
results from forced industrialization at the expense of agriculture, which
is generally accompanied by severe inflation. Right or left extremism
which poses potential threats to US security interests will probably be
strongest in Argentina, Bolivia, Chile, Guatemala, and possibly Brazil.
In these countries there will continue to be substantial Communist and
demagogic nationalist influences, which will attempt to channel the
resentment of the dislocated groups against the US. In Guatemala
Communist influence over the government, already strong, may increase.
Communist penetration of British Guiana has posed a new problem in
the Caribbean area.
TOP SECRET 10 Decembgr
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1-10 TOP SECRET
Most Latin American countries will probably continue to cooperate
with the US in the UN on basic East-West issues, although they will tend
increasingly to pursue an independent course on issues affecting under-
developed countries. Latin America will be increasingly concerned about
US trade and especially tariff policies. Regardless of the degree of Latin
American cooperation with the US, there will probably be an increasing
tendency to expand commercial and possibly diplomatic relations with
the Soviet Bloc.
Apiki:PtIVAVRaiggse 2005/0811P 611C1:14467-00059A000100010002-7
GENERAL
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET I-B
Page 1 of 2
B. PROBABLE tnECTS OF INCREASING NUCLEAR CAPABILITIES
UPON THE POLICIES OF US ALLIES*
(Secret)
ASSUMPTIONS
Nuclear weapons will not have been used in war since 1945.
No international agreement will have been made restricting or
outlawing the use of nuclear weapons in war.
CONCLUSIONS
A great and recognized growth in nuclear capabilities will
obviously intensify the anxiety of peoples and governments to avoid
war. No government will willingly run risks of war unless interests
are at stake which it considers vital, and the threat of nuclear
weapons will almost certainly tend to narrow the range of interests
that any government will consider vital.
Under such circumstances, the difficulties presently felt in
maintaining an effective Western coalition under US leadership may
be increased, but we do not believe that the alliance will neces-
sarily show significant weakness, at least as long as there does
not seem to be a greatly increased likelihood of general war. The
US allies will probably seek to obtain greater influence over US
policy in order to ensure a cautious and non-provocative attitude
toward the Communist states.
The alliance could receive a severe test, however, in con-
nection with local aggression committed or supported by the Soviet
Bloc. Fear already exists that strong reaction to such aggression
might lead to general war. Fears of general war will be intensified
when both great power blocs are believed to possess large nuclear
capabilities. US allies would therefore be even more insistent than
at present that every effort be made to limit the scope and area
of local conflicts and to deal with local aggression without resort-
ing to acts which might expand the conflict into general war. US
allies generally would also be more unwilling than at present to
participate in repelling local Communist aggression.
* This section includes the Conclusions of NIE 100-54, "Probable
Effects of Increasing Nuclear Capabilities upon the Policies
of US Allies", 26 April 1954.
MORI 1189628
TOP SECRET 1 May 1954
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1-B TOP SECRET
Page 2 of 2
In the event of international crisis involving grave danger
of general war, we believe that the allies would almost certainly
support the US as long as they believed that firm maintenance of
the alliance would probably avert war.
We cannot estimate the probable courses of action of US allies
if an international crisis should develop to the point where general
war seemed to them virtually certain and no longer to be averted
by firm maintenance of the alliance. There is inadenquate evidence
or precedent on which to calculate the reaction of governments and
peoples who consider themselves to be facing imminent threat of
attack with nuclear weapons. Among the factors influencing the
courses of action of each nation, we believe that the following
would be of most importance: (a) the estimate that the government
and people would make of their chances of survival in the event of
participation in general war; (b) the alternatives which would ap-
pear available at the time; (c) the political and social stability
of the state, and the morale of its population; (d) the importance,
to the state, of the issueS at stake in the crisis; (e) the strength
and cohesion of the alliance at the beginning of the crisis, and
the degree of integration Of its armed forces; and (f) the judgment
which people and government had made of the wisdom and skill with
which US policy had been conducted.
We believe that most allied governments, if confronted with
certain national destruction as the sole alternative to an ac-
commodation with the USSR, would choose the latter. We believe
it unlikely, though possible, that the major allies of the US
would become convinced that the alternatives facing them were so
limited and so clear-cut as the two described.
MORI 1189628
1 Miqpgad For Release 2005/08/41:' a-grP67-00059A000100010002-7
GENERAL
Approved For Release 2015/08/15 ? CIA-RDP67-00059A000100010002-7
StuFt.ET I-C
Page 1 of 5
C. PROBABLE DEVELOPMENT OF THE SOVIET BLOC
AND WESTERN POWER POSITIONS OVER THE
NEXT FIFTEEN YEARS*
We believe it essential to state at the outset that there is
no unequivocal answer to the question "is time on our side." Even
assuming a continuation of the present amoral trend of policies
of both the Bloc and the Western Powersw* (itself an assumption of
doubtful validity), there are so many accidental or unpredictable
factors which will materially affect the world situation as to
prevent any firm estimate of the relative Soviet Bloc and Western
power positions fifteen years from now. However, it is possible
to appraise in general terms our likely power position vis-a-vis
the Bloc if present trends continue and if various major alternative
developments do or do not come to pass.
PROBABLE ECONOMIC GROWTH OF SOVIET BLOC AND THE WEST
The Soviet Bloc. At present the over-all economic strength
of the Soviet Bloc is far less than that of the Western Powers;
in term of gross national product (GNP), the 1952 output of the
entire Bloc is estimated to have been about one-third that of the
Western states.*** However, the economic strength of the Soviet
Bloc should increase greatly over the next 10-15 years. Soviet
GNP will probably almost double within this period, while Bloc GNP
as a whole will increase around 75 percent.
Bloc economic capabilities to wage war are likely to increase
substantially since the Bloc will probably continue to place great
emphasis on military production.
* This section is a summary of SE i6, "Probable Long Term
Development of the Soviet Bloc and Western Power Positions",
8 July 1953.
** The Western Powers are taken to include the US and its allies.
4 f For the purpose of these economic projections, the Western
Powers include the US, the European NATO countries, West
Germany, Canada, Australia, and Japan.
Approved For ReleaseTitY0?/Wg: CIA-RDP67-00059141M/Gart0002-7
Approved For Release 2005/08/15: CIA-RDP67-00059A000100010002-7
I-C TOP SECRET
Page 2 of 5
The West. It is more difficult to estimate the probable eco-
nomic growth of the Western Pcwers. The Western economies are more
vulnerable to economic fluctuations and trends in international
trade than are those of the Bloc. However, assuming a continuation
of present trends and no serious depressions, we estimate the prob-
able growth in US GNP at about 56 percent over the next fifteen
years, and at almost 50 percent for the WesternPowers as a whole.
While Bloc GNP will probably increase at a higher rate than
that of the Western Powers, the GNP of the West is already so much
greater than that of the Bloc that the absolute gap between the
two will widen despite the lower rate of Western growth. Thus the
West will remain for the indefinite future greatly superior to the
Soviet Bloc in total economic strength.
PROBABLE SCIENTIFIC CAPABILITIES OF THE WEST AND THE SOVIET BLOC
The over-all scientific assets of the West are now far
greater than those of the Soviet Bloc, and almost certainly will
remain greater over the next fifteen years, despite great efforts
by the USSR to reduce this disparity.
It is impossible to estimate whether the power relationships
between the Soviet Bloc and the Nest will be changed during the
period of this estimate by any major technological breakthrough by
either side, such, for example, as the initial production of the
atomic bomb by the US in 1945.
PROBABLE TREE:6 IN THE MILITARY CAPABILITIES OF THE WEST AND THE
SOVIET BLOC
We believe that throughout the next fifteen years the West
will maintain a substantial absolute advantage in capabilities for
atomic warfare, but that the Bloc will gradually reduce this ad-
vantage. Within the period of this estimate both US and USSR will
produce a sufficient stockpile of atomic and possibly thermonuclear
weapons to cripple the other side, if delivered on targets. How-
ever, unless it attained complete strategic surprise or achieved
an unforeseen technological breakthrough, we believe that neither
side would be able to prevent powerful retaliation in kind. It is
likely that the West will, during the period of this estimate,
remain superior to the Soviet Bloc in capabilities for tactical use
of atomic weapons.
The development of Bloc and Western power positions during the
next fifteen years will be significantly affected by their relative
lAiwoyglifor Release 2005/08/15rogINNE137-00059A000100010002-7
Approved For ReleasegO5s/RE: CIA-RDP67-00059f080100010002-7
Page 3 of 5
conventional military capabilities. Bloc military forces are being
continuously modernized and strengthened. The ability of the West
to counterbalance this by developing local military capabilities,
particularly in key areas such as Went Germany and Japan, will
depend on Western and other policy decisions.
PROBABLE TRENDS IN THE POLITICAL AND SOCIAL STRENGTH AND COHESION
OF THE SOVIET BLOC AND THE WEST
The Soviet Bloc. Political and social trends will have an
important, and perhaps controlling effect on the relative power
positions of the Bloc and the West and are most difficult to
estimate over so long a period as the next fifteen years. During
this period a struggle for control within the Kremlin might cause
a retraction and decay of Soviet power. However, we believe it
unsafe to assume that over the next 10-15 years the Soviet regime
will lose its stability or the Bloc its cohesion.
Trends in the Political and Social Strength and Cohesion of
the West. Because of the greater diversity of the looser Western
coalition, we find it even more difficult to project probable
trends in Western strength and cohesion. However, at no time in
the foreseeable future will the Western Powers be likely to attain
or to desire to attain centralized control to mobilize their re-
sources. In general, they will probably continue to be more sub-
ject to internal conflicts, economic fluctuations, and divisive
influences than the Bloc.
As the only single aggregation of resources outside the US
itself comparable to the Soviet Bloc, Western Europe plays a major
role in the world power balance. Its continued weaknesses con-
stitute a major vulnerability of the Western Powers, while Western
Europe's acquisition by the Bloc would be a tremendous increment
to Soviet power. The reappearance of a strong and viable Western
Europe, including Germany, would alter the present power relation-
ship between the Soviet Bloc and the West to the advantage of the
latter.
We believe that a primary concern of the Kremlin over the
coming period will be to frustrate the development of a viable
and defensible Western Europe; in so doing the Kremlin will almost
certainly concentrate on the German problem. If a shift in Soviet
policy on Germany, for example, led the Germans to accept a united,
armed, and neutral Germany, it would introduce a new factor of
great significance into the world power balance. Such a develop-
ment, if accepted by our NATO allies, would not necessarily weaken
the Western position. A rearmed and neutral Germany would act as
a buffer state, and if the Germans were subsequently to abandon
neutrality, we believe that they would be more likely to align
themselves with the West than with the Bloc.
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SEcRET 1 may 1954
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
.I-C TOP SECRET
Page 4 of 5
The emergence of a rearmed, anti-Communist Japan would be a
major asset in restoring the strategic balance in the Far East.
However, the degree of future Japanese cooperation will depend
largely on the extent to which Japan's political, economic, and
military demands are met.
The Strength and Alignment of "Gray" Areas
A major difficulty facing the West is represented by the
extreme political and social instability of the underdeveloped
areas of the Middle and Far East and Africa. The anti-Western
overtones of this political and social revolution create ad-
ditional difficulties for the West. The danger to the Western
position is acute in some areas of Southeast Asia and the Middle
East. Their loss would be a serious blow to the West.
However, Western control or influence is still paramount in
these areas. Over the next 10-15 years the US and its allies
still have the opportunity to undertake actions which might arrest
this trend and maintain that influence.
Possible Effects of a Kremlin Shift to Soft Tactics
We believe that a prolonged Kremlin shift to more moderate
tactics would also present a real challenge to further growth of
the Western Alliance. Should the Soviet threat appear to diminish,
the likelihood of divisions among the Western Powers would markedly
increase. It might lead, over the longer run, to some of our al-
lies adopting more neutral positions, or even to the creation of
a European "Third Fome."
A prolonged relaxation of tensions might also have an ad-
verse effect on the cohesion and vitality of the world Communist
apparatus and hence on the Soviet power position. Soviet leaders
are under some compulsion to pursue an aggressive policy in order
to preserve the Communist ideology as a vital force. Any pronounced
subduing of the irreconcilable hostility motif of Communist propa-
ganda might serve to soften the rank-and-file of foreign Communist
parties.
IS TIKE ON OUR SIDE?
We believe that the Soviet Bloc under present policies and
programs will over the next 10-15 years decrease the proportion by
which its economic and technological capabilities are inferior to
Pf0311:5541 For Release 2005/08/1f0PCIAMP67-00059A000100010002-7
Approved For ReleaseT200p054M: CIA-RDP67-00059fk_Q610100010002-7
Page 5 of 5
those of the West and will acquire sufficient atomic capabilities
to cripple the US. Therefore, although the West will probably
retain a sizable absolute margin of superiority, we believe that
in these respects time must be said to be on the Soviet side.
In other respects, time may be on the side of the West. The
West's military capabilities will increase during the next fifteen
years if conventional rearmament programs and tactical applications
of unconventional weapons enhance its present defensive capabili-
ties in overseas areas. The extent to which these developments
are likely to occur depends on Western and other policy decisions.
Trends can be identified within both the West and the Bloc
which might undermine each side's political stability and cohesion.
We cannot predict, however, that these trends will have such ef-
fects and certainly we cannot say that they would do so within the
period of this estimate.
Even under the assumption of continuation of the present
general trend of policies in both the Bloc and the Western Powers,
there are so many accidental or unpredictable factors which could
alter present trends, that we are unable to conclude that time
is on the side of either the Soviet Bloc or the West. Though a
few of the components of power can be projected with fair confi-
dence, the relative over-all development of the power positions of
the West and Soviet Bloc cannot be predicted.
Approved For Release 20D5100/115RECIA-RDP67-00059A040*9501462-7
II. SOVIET BLOC
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 200541g1?MRTRDP67-00059A0001000pritb2z7
age of 13
SOVIET BLOC
A. SOVIET CARIBILIlish AND PROWLE
COURSES OF ACTION THROUGH MID-1959*
(See charts following this section)
WIC COMMUNIST OBJECTIVES AND BFLTRFS
The Communist leaders now in power in the USSR, or any that are
likely to succeed the% almost certainly will continue to consider
their basic objective to be the consolidation and expansion of their
own power, internally and externally? In pursuing this policy most
Soviet leaders probably envisage ultimatelys (a) the elimination of
every world power center capable of competing with the USSR; (b) the
spread of Communism to all parts of the world; and (c) Soviet domina-
tion over all other Communist regimes,
Soviet leaders probably are also committed to the following
propositions concerning the empansion of the power of the USSRg
a. The struggle between the Communist and the non-Communist
world is irreconcilable;
b. This struggle may go on for a long time, with periods of
strategic retreat possibly intervening before the final
Communist triumph;
C. The struggle will not necessarily involve general war,
though general war is always a possibility;
During the period of "coexistence of the two camps"
of Connunism and capitalism, the Communists must steadily
build up the economic and military strength of the USSR,
its Satellites, and Communist China; and
?
At the same time, the Communists must constantly try to
divide and weaken the non-Communist
SOVIET POLITICAL STRUCTURE AND DOMESTIC DEVELOPMENTS
Events since Stennis death do not indicate any essential changes.
in the institutional bases of Soviet power. The system of party
* This section is based on NIE 11-4-54, "Soviet Capabilities and
Probable Courses of Action Through Mid-1959," 14 September 1954.
A new estimate, NIE 11-3-55, "Soviet Capabilities and Probable
Courses of Action Through 1960," will be published in May.
Approved For Release 2005/W15s:
Cop No.
DP67-00059A0V-10001.01W
Page 2 of
tproved For ReleastDEONThirk : CIA-RDP67-00059A000100010002-7
controls over the police, armed forces, and the bureaucracy remains
intact. The Beria affair, during !whicA the influence and status of
the MVD were reduced, confirmed the effectiveness of party controls
within this important instrument of power. Despite the increased
prestige granted to certain military career officers since Stalin's
death, there is no evidence of stiV relaxation of party controls over
the armed forces.
Stabilitz:of the Regime
We believe that the present Soviet regime is firmly in power
and that it is unlikely to be dislodged either by a grouping of
forces outside the top leadership or as the result of a struggle
within it, Significant changes may take place in the composition
of the ruling group or in the relative power positions of its members;
one man may even succeed in gaining absolute power. We believe, hoe-
ever, that the new Soviet regime mill be able to resolve such con-
flicts within the confines of the ruling group and the higher echelons
of the Communist Party. Consequently, we believe that whatever con-
flicts for power 4r differences respecting policy may develop within
the ruling group, they are unlikely to affect significantly the
stability of the regime or its authority within the country, or to
prevent it from making policy decisions and carrying them out. These
policies and their implementation will continue to reflect the funda-
mental agreement which evidently obtains Among the leaders concerning
the basic objectives of the Communist regime.
Domestic Policies
Although there has been no weakening in the authority of the
Soviet regime, there has been an apparent effort to moderate some of
the more vigorous aspects of the system devised by Stalin. Since
the death of Stalin the regime has promised the people an improve-
ment in their standard of living and increased personal security
for average law-abiding citizens. The regime has backed these pro-
mises with a variety of measures designed to impress upon the popu-
lation at large the seriousness of its intentions.
We believe that the Soviet regime's present efforts to moderate
Certain aspects of the dictatorship and to raise living standards
sprang from a conaidered revision of the extremes of Stalin's manner
of rule and were not merely the temporary concessions of a new regime.
We believe that the Soviet leaders recognize that a reversal of this
program, except in the event of an external threat of actual war,
would result in serious public discontent Which would tend to retard
the growth of Soviet economic strength. Consequently, these measures
will Almost certainly be continued for the next two or three years,
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/669?5DP67-00059A0001000
IkS of 13
and possibly throughout the period of this estimates if the pressure
of external or internal circumstances does not require their reversal.
The result may well be an improvement of morales, especially among
the more privileged eleeents of the population. However if the oone
cessions made to the peasant population do not achieve sufficient
increases in agricultural productions, or if they result in renewed
resistance to the system of collective farming, the regime will prob-
ably resort again to more repressive measures against the peasantry.
In this events, the regime might find itself ?faced with serious prob-
lems of low public morale and low productivity.
SOVIET-SATELLITE RELATIONS
The appearance of new leadership in Nbscow has had no apparert
effect on the character of the relations betwe n the USSR and its
Satellite states in Eastern Europe. We believe that Soviet authority
over the satellite regimes will remain intact during the period of
this estimete. Widespread political discontent and serious difficulties
in building up the Satellite economies will continue. However, during
the next five years the Satellite centribution to Soviet power will
gradually increase. Soviet control will continue to depend primarily
on the presence or proximity of Soviet armed forcess, and in the
absence of general war popular dissatisfaction almost certainly will
not develop. beyond the stage of paseive resistance and occasional
localized outbreaks of violence.
SINO -SOVIET RELATIONS .
The relations of the USSR with Communist China are markedly
different from those prevailing between the USSR and any other Comm-
unist country. Communist Chima is more a Soviet ally than a Satellite.
It posseesee some capability for independent actions, possibly even
for action which the USSR might disapprove but which it would find
difficult to repudiate. However, the main outlines of Communist
policy in Asia are probably jointly determined * Moscow and Peiping.
While the Soviet voice probably will remain preponderants, Communist
Chine appears to be increasing its stature within the Sino-Soviet
partnership. Soviet propaganda and diplomacy have recently given
great emphasis to Chinags claim to an acknowledged position in inter-
national affairs? and the USSR has giw en evidence of a willingness
to have Communist China assume greater responsibilities in further-
ing Communist interests in Asia. In particular Communist China seems
to have an increasingly important role in the execution of Communist
policy in North Korea and Indochina.
Copy No.
TOP sEcimr 1 April 19
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
II-AA Approved For ReleAROMM5 : CIA-RDP67-00059A000100010002-7
Page 14 of 13
The national interests of the USSR and Communist China are in
SOMB cases conflicting, and constitute potential sources of friction
between the two powers. We believe, however, that throughout the
period of this estimate the cohesive forces in the Sino-Soviet re-
lationship will be far greater than the divisive forces. The USSR
and Communist China share a common ideology. Both of them regard
the US AO the chief obstacle to the achievement of their objectives,
and consider that their interests are threatened by US policy and
power. Moreover, each partner profits at the present time from its
alliance with the other. Communist China receives essential Soviet
political, military, and economic support. Soviet leaders recognize
in China a valuable ally, Which provides the USSR not only military
strength and defense in depth in the Par "Bast, but also a base for
further advancing Communist aims in Asia.
SOVIET Ecopomrp POLICY
The present regime in the USSR has not fundamentally changed
the traditional policy of placing primary emphasis on the rapid
development of heavy industry and war potential. The new regime
has, however, devoted a great deal of its attention and energies to
a revision of =rent economic plans aimed at speeding up the produc-
tion of agricultural commodities, especially foodstuffs, and manu-
factured consumer goods. Soviet leaders have stated that this goal
is to be achieved without decreasing the tempo of heavy industrial ?
development, but they apparently intend, at least for the next two
years, to limit defense outlays to approximately the high level
reached in 1952 andmaintained in 1953. This modification of Soviet
economic programs is designed to overcome deficiencies in certain
sectors of the economy, particularly agriculture.
We believe that Soviet economic policy will continue, at least
through 19552 to place primary emphasis on the further growth of
heavy industry, While maintaining defense outlays at approximately
a constant level, and giving increased attention andresources to
agriculture and consumer industries. Since advances in consumption
are likely to fall far short of expectations, the chances are good
that the regime will feel it necessary to continue the pattern of
resource allocations along present lines through 1959. However, if
at any time the KreOlin estimates that international tension is
rising dangerously, 'then it Will almost certainly increase defense
allocations.
SOVIET ECONOMIC GROWTH
The rate of growth of the Soviet economy has declined in the
past five years from the very high: rate of the immediate postwar period.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/0TR5MRDP67-00059A0001000
to i 0
of 13
We estimate that during the next two years Soviet gross national
product (GNP) will increase by about six or seven percent, and in
1956-1959 by about five or six percent, per year. If US GNP should
increase during the period of this estimate at its long-range annual
average of three percent, Soviet GNP would at the end of the period
bei about two-fifths of US, as compared with about oneg4hird in 1953.
The pattern of resource allocation in the Soviet economy in
1953 showed about -14 percent devoted to defense, 28 percent to in-
vestment, and 56 percent to consumption. Current econOmic programs
indicate that for at least the next two years the amount of expendi-
ture on defense, instead of continuing the rapid increase that
prevailed in 1950-,1952 will remain about the same, While expenditure
on investment and consumption will increase. We believe the chances
are better than even that the Kremlin will continue its policies
along these lines throughout the period of this estimate-, The chief
emphasis will almost certainly continue to be on further development
of heavy industry.
The Soviet leaders probably recognize that their economy is
unable to support the additional heavy investment outlays in industry
and the increased requirenents of the agricultural and consumer goods
program, While simultaneously maintaining such a rapid rate of in-
crease in the production of conventional military goods as prevailed
in the Korean War period. Moreover?, Maintenance of a constant level
of total military expenditure would not imply any slackening in the
Soviet program in the field of unconventional weapons. It is possible,
despite the absence of direct evidence, that the USSR will maintain
conventional military production at somewhat lower levels for at least
the next few years, but will give increased emphasis to the develop-
ment of unconventional weapons and new weapons systems.
The chief weakness of the Soviet economy as a Whole has been
in agricultural production, Which has remained since 1950 at ap-
proximately the prewar level, though the population is now about
10 percent greater than in 19140. Soviet leaders appear to have
recognized that continuation of the serious lag in agriculture would
ultimately make it difficult to meet the food requirements of the
growing urban population, the raw material reqnirements of the ex-
panding industrial economy, and the export requirements of Soviet
foreign, trade, iA which agriculture plays a major role. To remecly
the situation the regime has embarked on a vigorous prOgram? with
the aim of achieving by 1956 a 50 percent increaee in agricultural
production over 1950. We believe that this goal will not be met,
and that even by 1959 agricultural production will be no more than
15 to 20 percent higher than in 1950. Even this increases however,
would be sufficient to achieve a moderate increase in the per capita
availability of foodstuffs and textiles.
Copy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved ForRelea2816
Page 6 of 13
SCIENTIFIC AND TECHNICAL DEVELOPMENTS
15: CIA-RDP67-00059A000100010002-7
Soviet scientific and technological capabilities are sufficiently
well developed to provide effective support to industrial and military
research and development. At present, the scientific assets of the
USSR (the number and quality of trained personnel, facilities, equip-
ment, and financiel support) are smaller than those of the US, and
the assets of the Soviet Bloc are far smaller than those of the West.
However, with respect to scientists of the very top rank, whose
numbers are few in any country, the USSR probably has in many fields
men who are as able as their counterparts in Western countries. The
USSR provides the bulk of Bloc scientific assets, but East Germany
and Czechoslovakia, and to a lesser extent Poland and Hungary, con-
tribute a substantial increment. Communist China is unlikely to add
significantly to Bloc scientific assets prior to 1960.
MILITARY STRENGTH AND WEAPONS DEVELOPMENT
We believe that, generally speaking, the size of Soviet armed
forces-in-being will remain approximately constant during the period
of this estimate. However, the over-all effectiveness of these
fortes will increase, mainly because of the following factors:
a. A great increase in numbers of nuclear weapons, and in
the range of yields derived frap these weapons;
b. An increase in the number of all-weather fighters and
jet medium bombers, and the introduction of jet heavy
bombers in 1957;
c. A great increase iA the number Of long-range submarines; and
d. An increase in combat effectiveness of Soviet ground forces,
primarily due to improved weapons, equipment and organizes
25X1 tion, and to changes in doctrine and tacticsdesigned to
increase their capabilities for nuclear warfare.
1 April 1955
TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1 Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Next 1 Page(s) In Document Exempt
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/0M :4151MADP67-00059A00010001MC*7
Page 9 of 13
Jet Bombers
In the past several months there have been =elusive indica-
tion that a jet medium bOmber equipment program has been initiated
in Soviet Long-Range Aviation. During the 1954 Soviet May Day
fly-by and the rehearsals preceding it, 9-11 twin jet medium bombers,
designated by allied intelligence as Type 39, participated. SUb-
segued, intelligence has associated this type with a known Soviet
Long-Range Aviation unit. We estimate that as of 1 July 1954 at
least two regiments of Soviet Long-Range Aviation with a TIE
strength of 60 aircraft were in process of equipment with Type 39
jet medium bombers. Total actual strength of these units is estimated
at approximately 20 aircraft. Series production of the Type 39 is
estimated to have begun in mid-1953, and total production as of
1 July 1954 is estimated at about 40 aircraft. It is estimated that
Soviet Long-Range Aviation will contain an actual strength of 650
jet Medium bombers by mid-1957, and 1,050 by mid-1959.
The Type 370 which was initially observed on 30 July 1953 and
later observed in flight on seven different occasions in connection
with the 1954 May Day celebration, is a swept wing, for-engine,
jet heavy bomber with an estimated gross weight of 365,000 peunds.
The aircraft, considered presently to be in the prototype stage,
is expected to appear in operational units by the end of 1956 building
up to an actual strength of about 50 aircraft by Mid-1957 and 250
by mid-1959.
There has been some evidence of the existence of a large bomber
designated the Type 31. On the basis of present evidence, it is
highly doubtful that any substantial re-equipment of Long-Range
Aviation units with Type 31 class aircraft has occurred to date,
though possibly 15 or 20 may have been introduced. The Long-Range
Aviation re-equipment program to replace the TU-4 is more likely to
be accomplished by introduction of the jet bomber aircraft which
have now appeared, and the Type 31 class probably will not be in-
troduced in numbers.
uopy No
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
II-A Approved For Relea172NRE5 : CIA-RDP67-00059A000100010002-7
Page 10 of 13
Air Defense Weapons
We estimate that at present Bloc defensive capabilities against
air attack are insufficient to provide an adequate defense under the
variety of eenditione which could be expected to prevail. Through
1957 Bloc air defenses will probably be gradually strengthened by
the introduction into operational units of new fighter aircraft, new
radar equipment, new anti-aircraft weapons, and surface-to-air guided
missiles. All-weather fighters in limited quantities are probably
already being introdueed into operational units, but problems related
to the operation and maintenance of airborne intercept radar will
probably take a minimum of 18-24 months to solve. The filtering
phase of air raid reporting (combat information control) is expected
to continue to be a major problem daring the period of this estimate.
However, the gradual improvement of weapons, equipment and training
will be sufficient by 1958 to provide a Bloc air defense system
substantially more effective than that now existing.
Submarines
The Soviet Navy is apparently concentrating on the construction
of two long-range submarine types developed since World War II.
These are equipped with snorkel and have operating radii of about
4,700 and 6,700 miles respectively. By early 19550 107 of these had
joined the fleet and the present building rate is estimated as 75
per year. The Soviets are known to have continued development of
the Walther Closed-cycle engine for submarine propulsion and an
experimental submarine powered by such an engine could be operational
now. It is also possible that, during the period of this estimate,
nuclear propuJ ion for submarines will have been developed by the
USSR. However, there is no evidence of Soviet development of sub-
marines equipped with either of these types of propulsion.
PROBABLE SOVIET COURSES OF AMON
We believe that the developments within the sphere of Soviet
power and the Soviet estimate of the world situation have led the
Soviet leaders to assess their own situation somewhat as follows
the balance of military power in the world and the increasing
destructiveness of nuclear weapons are such that general war would
involve very heavy risks to the Communist sphere, extending possibly
to the destruction of the Soviet system itself. On the other hand,
non-Communist power is not so great that withdrawals from the present
advanced positions in Europe and Asia seem necessary. Moreover,
the prospects probably seem good that the increase of Bloc military
capabilities, together with political defections or disunity on the
non-Communist aide, will gradually shift the balance of power in
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/013CF5 SIBERTDP67-00059A00010001DDEUR-7
Page 11 of 13
favor of the Soviet Bloc. In the meantime, the Bloc has a full
agenda of internal problems which, while they do not imply a
weakness requiring abandonment of expansionist aims or even the
neglect of opportunities for expansion under circumstances of limited
risk, do call for attention during the next five years at least.
These problems include the further buildup of economic power in the
Bloc as a step toward balancing the vastly greater economic potential
of the West, and the correction of certain weaknesses in the Bloc
economy, particalarly in agricultural production.
We believe that during the period of this estimate, the Kremlin
will try to avoid courses of action, and to deter Communist China
from courses of action, which in its judgment would clearly involve
/substantial risk of general war.* However, the USSR or one of the
Bloc countries might take action creating a situation in which the
US or its allies, rather than yield an important position, would
decide to take counteraction involving substantial risk of general
war with the USSR. We believe, moreover, that the Kremlin would not
be deterred by the risk of general war from taking counteraction
against a Western action which it considered an imminent threat to
Soviet security. Thus general war might occur during the period of
this estimate as the climax of a series of actions and counteractions*
initiated by either side, which neither side originally intended to
lead to general war.
The progress being made by the USSR in the development of nuclear
weapons, and the increasing Soviet capability to deliver these weapons,
are changing the world power situation in important respects. Soviet
* ThecAssistant Chief of Staff, G-2, and the Director of Intelligence,
USAF, believe that the following Should be substituted for the first
sentence of this paragraphs "Although the Kremlin will probably
try to avoid courses of action and to deter Communist China from
courses of action that entail'substantial risk of involving the
USSR in general warp it may be more willing to support courses of
action that would involve risk of a localized war between the US
and Communist China. The support given such courses of action
would depend largely on Soviet judgment as to the probable outcome
of the war. If the Soviet leaders believed that it would result
in a severe defeat to Communism, or the fall-scale participation
of the USSR in general watj, they would probably exert pressure on
the Chinese to avoid courses of action which would precipitate
hostilities. On the other hand, if they estimated that the conflict
could be limited to war localized in the Far East, and that it
would result in greater relative damage to US strengths than to
Communist strengths, they probably would support more adventurous
courses of action on the part of the Chinese COnnunists.?
Copy Noe
Approved For Release 2005/0TR5%MRDP67-00059a3011160131107F-
11.4 Approved For ReleailiOPOS
Page 12 of 13
5 : CIA-RDP67-00059A000100010002-7
leaders almost certainly believe that as Soviet nuclear capabilities
increase, the unwillingness of the US and its allies to risk general
war will correspondingly increase, and that the Kremlin will there-
fore have greater freedom of action to promote its objectives without
running substantial risk of general war. In any case, the USSR will
probably be increasingly ready to apply heavy pressure on the non-
Communist world upon any signs of major dissension or weakness among
the US and its allies, Nevertheless, we believe that the Kremlin
will be extremely reluctant to precipitate a contest in which the
USSR would expect to be subjected to nuclear attack, The extent to
which the Kremlin uses its increasing freedom of action will depend
primarily on the determination, strength, and cohesiveness of the
non-Communist world,
We believe that the Kremlin will continue to pursue its ex-
pansiOnist objectives and to seek and exploit opportunities for
enlarging the area of Communist control. It will be unswerving in
its determination to retain the initiative in international affairs
and to capitalize on successes in order to keep the Free World on
the defensive, For the near term, however, the Kremlin will almost
certainly direct its external policies towards the immediate ob..
jectives of weakening and disrupting the mutual defense arrangements
of non-Communist states, preventing or retarding the rearmament of
Germany and Japan, undermining the economic and political stability
of non-Communist states, and isolating the US from its allies and
associates in Europe and Asia. At the same time it will continue
to expand the industrial strength of the Bloc, and to maintain large
modern forces-in-being as a guarantee of the integrity of the Bloc
and as an instrument of intimidation in support of its policies abroad.
The Communists will vary the methods used to accomplish the
foregoing aims and will time their actions so as to exploit situations
that in their judgment offer the most favorable opportunities. For
the time being, the Krealin seems to feel that its foreign objectives
will be best served by a generally conciliatory pose in foreign
relations, by gestures of HpeacefUl coexistence" and proposals for
mutual security pacts, by tempting profrers of trade, and by playing
on the themes of peace and disarmament. The purpose of these tactics
is to allay fear in some parts of the non-Communist world, to create
the impression that there has been a basic change in Soviet policy,
and therefore to destroy the incentive for Western defense, and to
undermine US policies, At the same time, however, the Communists
continue to support and encourage nationalist and anticolonial move-
ments, and to maintain their efforts to subvert governments outside
the Bloc. We believe that the Kremlin will revert to more aggressive
and threatening conduct Whenever if feels that such conduct will
bring increased returns. By such varieties and combinations of tactics
1 April 1955 TOP SECRFX
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/01iDiMERDP67-00059A0001000141*-7
Page 13 of 13
the Soviet leaders almost certainly consider that they cal improve
the chances fOr further Communist strategic advances. We do not
believe that such tactics indicate any change in basic Communist
objectives, or that they will involve any substantial concessions
on the part of the Kremlin.
We believe that Southeast Asia almost certainly offers, in the
Cormunist view, the most favorable opportunities for expansion in
the near future. The Communists will almost certainly attempt to
extend their gains in Indochina, and will probably expand their
efforts to intimidate and subvert neighboring countries by political
infiltration and covert support of local insurrections. We do not
believe that the Communists will attempt to secure their objectives
in Southeast Asia by the commitment of identifiable combat units
of Chinese Communist armed forces, at least during the early period
of this estimate, However, we find the situation in this area so
fluid that we are unable-to estimate beyond this early period.
Copy NO,
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
2
Section II-A
Figure 3
CHEMICALS PRODUCTION
SYNTHETIC AMMONIA
ouu
US
2074
000
500
Bloc
000
1037
53
500
USSR
/
265
0
1938 '48 '49 '50 '51 '52 1953
12
10
2
FERTILIZER
Millions of Metric Tons
15
12
9
6
3
0
SULPHURIC ACID
US
'12.9
Western Allies
?9.4
Bloc
4.1
USSR
.../ -----
.1.5
2.8
1956 1959 1938 '48 '49 '50 '51 '52 1953
USSR
6.0
3.2
0
1938 '48 '49 '50 '51 '52 1953 1956 1959
13396 CIA, 9-54
1956
1959
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
120
100
80
?S2
60
.2
Thousands of Metric Tons
40
20
0
METALS AND MINERAES PRODUCTION
INGOT STEEL
to
US
,101.2
Western Ales
62.2
Bloc
48.4
USSR ---.,,
37.7
18.0
1938 '48 ,52 1953
1200
1000
800
600
400
200
1956
PRIMARY ALUMINUM
.1959
US
1135.8
Western Allies
851.0
Bloc
369.
310.0
/USSR
43.8
.
1938 ,50 ,52 1953
13395 CIA, 9-54
Thousands of Metric Tons
1000
800
600
400
200
0
Section II-A
Figure 2
PRIMARY AND
SECONDARY COPPER
?
UJ
1015.0
Bloc
422.2
T.
Western Al
515.0
'
ies
USSR _
_
115.0
350.0
1938 '48 ,50 ,52 1953
BO
60
40
20
0
CEMENT
1956
1959
'Western Allies
59.4
US
'45.0
_
Bloc
25.3
16.1
/USSR
5.70
1956 1959 1938 ,48 '49 ,52 1953
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1956
1959
Approved For Release 200510811P41: CIA-RDP67-00059A000100010002-7
USSR
PARTY AND GOVERNMENT ORGANIZATION
PARTY
GOVERNMENT
PRESIDIUM SECRETARIAT COUNCIL OF MINISTERS PRESIDIUM
MEMBERS
BULGANIN
VOROSHILOV
KAGANOVICH
MIKOYAN
MOLOTOV
PERVUXHIN
SABUROV
KEIRUSHCHEV? ? ?
MALENKOV-
CANDIDATES
Shvernik
Ponomarenko
Kirichenko ?
FIRST SECRETARY
Khrushchev _
SECRETARIES
Pospelov
Shatalin
Suslov
Central Committee
Party Congress
PRESIDIUM
CHAIRMAN
Bulganin
FIRST DEPUTY
CHAIRMEN
Kaganovich
Mikoyan
Molotov
Pervukhin
? Saburov
DEPUTY CHAIRMEN
? ?Malenkov
Kosygin
Malyshev
Tevosyan
Khrunichev
Kucherenko
Lobanov
Zavenyagin
48 other ministers
2 millhn1rstrrfili7.14of
CHAIRMAN- CEREMONIAL
HEAD OF S1ATE
Voroshilov
16 DEPUTY CHAIRMEN
(The chairmen of the
Suprene Soviet Pre-
sidiums in the 16
Republ ins)
SECRETARY
Pegov
MEMBERS
? ?Khrushchev
--Shvernik
? Ponomarenko
? --Kirichenko
(In addition there are
11 other members of
lesser importance)
Supreme Soviet
Soviet of the Union
Soviet of Nationalities
1955 50408 3
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
FIGURE 1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
? SECRET
500
400
ki 300
'c
0
tn
g 200
100
0
Section 11-A
Figure 4
ENERGY AND TRANSPORT
ANTHRACITE AND
BITUMINOUS COAL
Western Allies
495.0
US
435.2
Bloc
393.3
28.0
USSR
/
114.5
1938 '48 '49 '50 '51 '52 1953
400
300
0
200
0
45
?C2.
100
1956
PETROLEUM PRODUCTS
1959
US
327.6
Western Allies
92.9
Bloc
58.4
USSR
r
45.5
26.3
1938 '48 '49 '50 '51 '52 1953
13397 CIA, 9-54
1956
1959
600
500
400
O 300
200
Billions of Ton-Kilometers
100
0
ELECTRIC POWER
US
513.5
Western Ales
312.5
Bloc
.205.1
i
133.0
USSR
/
39.6
1938 '48 '49 '50 '51 '52 1953
1000
800
600
400
200
RAIL TRANSPORT
384.4
1956
1959
Bloc
975.0
US
901.1
Range of probable
USSR'4
pro-uction
800.0
Western Allies
259.1
0
1938 '48 '49 '50 '51 '52 1953 1956 1959
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
20
16
Billions of 1950 Rubles
4
MANUFACTURING
MOTORS AND GENERATORS* MACHINE TOOLS
160
US
16.7
USSR
Bloc
'7.1
4.4
0
1938 '48 '49 '50 '51 '52 1953 1956 1959
4
ELECTRON TUBES*
USS
US
7.3
Bloc
1.3
0.9
0
1938 '48 '49 '50 '51 '52 1953
Thousands of Units
120
80
40
Bloc
141.9
Section II-A
Figure 5
USSR
53.9
8
82
RangeOirprobable
USSR production
0
1938 '48 '49 '50 '51 '52 1953 1956 1959
200
150
0
kn 100
0
0
-c
50
0
TRACTORS
13Z
120
Ra
'-USSR
ge of prob
d
pro_uc
110
USSR_
/
49.0
1956 1959 1938 '48 '49 '50 '51 '52 1953
*In view of the somewhat heterogeneous composition of the items
included in these categories, and the problems of dollar-ruble
conversion, these estimates represent rough orders of magni-
tude of production rather than precise calculations of quantity
Or value.
13398 CIA, 9-54
1956
ble
ion
1959
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Releas`e 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
8
60
'
40
0
0
20
0
MILITARY END ITEM PRODUCTION
TOTAL AIRCRAFT PRODUCTION*
(Military and Civilian)
73.7
IIUS
11111
I 1

38.4
Bloc33.8
11!
Western Allies
14.6
1938 '48 '49 '50 '51 '52 1953
*including spares
20
16
0
ARTILLERY
1956
1959
\NUSSR
Bte
1.5
1.0
Western Allies
1,0.24
1938 '48 '49 '50 '51 '52 1953 1956 1959
13399 CIA, 9-54
10
Thousands of Units
80
8
6
4
2
TANKS AND
ASSAULT GUNS
US
9.1
USSR 7.5*
USSR
Section II-A
Figure 6
Range of probable
USSR production
USSR
1.5
Western Allies
0.6
0
1938 '48 '49 '50 '51 '52 1953 1956 1959
"USSR only
600
1,2
a)
400
200
0
1938
ARTILLERY AMMUNITION
USSR
24
USSR
544
'48 '49 '50 '51 '52 1953
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1956
1959
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
Millions of Metric TODS
Millions of Metric Tons
250
200
150
100
50
Section II-A
Figure 7
AGRICULTURAL PRODUCTION
GRAIN
'
Bloc
225
.US
140.6
Western Allies
100.2
88.6
\
USSR __,..--""
8N1
Range of
USSR pro
1938 '48 '49 '50 '51 '52 1953
160
120
80
40
POTATOES
1956
roboble
faction
1959
Bloc
148.0
73.8
USSR
6.4
Western Allies
64.5
US
10.1
0
1938 '48 '49 '50 '51 '52 1953
13400 CIA, 9-54
a
1956 1959
Millions of Metric TOM.
12
10
8
6
4
2
MEAT*
0
1938 '48 '49 '50 '51 '52 1953
US
,11.0
Bloc
10.2
Western Allies
9.5
a
NUSSR
1956
*Excluding slaughter fats, lard, fat cuts, and bacon.
1959
Assuming the continuation of the policy of encouraging
consumer goods expansion.
b Assuming the discontinuation of that policy.
The Western Allies of the US include the other members
of NATO together with Spain and West Germany.
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/1( : CIA-RDP67-00059A000100010002-7
SECRET
DIRECTION OF FLOW OF USSR FOREIGN TRADE, 1937 AND 1948-53
(Total Trade Turnover)
Millions of 195i US Dollars
Section II-A`
Figure 8
European Satellites
Communist China
West
3927
13401 CIA, 9-54
Approved For Release 2005/0811Fg111:67-00059A0001000100027
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Section 11-A
Figure 9
US AND USSR
COMPARISON OF MAJOR SCIENTIFIC GROUPS
AS OF MID-1954*
(In Thousands)
LIVING GRADUATES IN SCIENTIFIC FIELDS
Soviet Union -1400
IIIIIIIIIIIIIIIII
United States-1700
GRADUATES
SCIENTIFIC
1035
EMPLOYED
IN
FIELDS
1115
"SCIENTIFIC
(Professional scientists
teaching in higher
155
WORKERS"
in research
educational
institutions or
institutions)
240
Health Sciences - 22
Health Sciences
435
Agricultural Sciences
33
Health Sciences
290
Physical Sciences
and Engineering
185
Agricultural Sciences
185
Health Sciences
50
Agricultural Sciences
155
Physical Sciences
and Engineering
560
Physical Sciences
and Engineering
525
Agricultural Sciences
30
Physical Sciences
and Engineering
75
Soviet Union United States
Soviet Union United States
SOVIET KANDIDATS
AMERICAN
IN SCIENTIFIC
54
AND
Ph.D.'s
FIELDS
48
SCIENCE
/954
224
GRADUATES
and /955
134
Health Sciences
37
Agricultural Sciences
48
Health Sciences
16
Health Sciences
8
Physical Sciences
and Engineering
139
Health Sciences
43
Agricultural Sciences
10
Agricultural Sciences
10
Physical Sciences
and Engineering
28
Physical Sciences
and Engineering
30
Agricultural Sciences
24
Physical Sciences
and Engineering
67
Soviet Union United States
Soviet Union United States
13402 CIA, 9.54
*Numerical estimates of Soviet scientific personnel are be-
lieved to be correct to 'within plus or minus /0 percent.
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET II-B
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002age 1 of 6
SOVIET BLOC
B. CDmvITNIST CHINA*
Political
Since their assumption to power in 1949, the Chinese Communists
have undertaken to create an industrialized and militarily powerful state.
At present, the energies of the regime appear to be devoted to the con-
solidation and expansion of Chinals"economic strength, modernization of
military forces, and the transformation of China's political and social
structure.
The Chinese Communists have adapted Soviet administration and political
institutions and techniques to Chinese conditions. The highly centralized
and dictatorial government has imposed a unitary state structure with
direct lines of command down to the village level.
Ultimate power in China resides in the Cbmmunist Party and is vested
in the Political Bureau (Politb?ro) of the Party's Central Committee.
Mao Tse-tung continues to dominate the government and party. By the
terms of the Constitution, adopted in 1954, Chu Teh is in line to succeed
.Mao as Chairman of the government, but actual power appears more or less
divided between Liu Shao-chti, Chairman of the Standing Committee of the
Congress, and Chou En-lai, Chairman of the Government Council.
Despite rivalries for power in the past, Chinese leadership has
been marked by the cohesion and stability of the party elite. The first
purge of major proportions since 1938 appears to have been in process
since at least early 1954. The chief victims to date have been Kao
Kang ("suicide"), former Politburo member and boss of Manchuria; and
Jao Shu-Shih (present status unknown), former government head of the
East China regional area. There is no firm evidence as yet as to the
extent, intensity, or full cause of the purge campaign.
The precise manner in which Soviet influence or control finds
its way into Chinese policies is not known. Soviet advisers almost
This section contains a summary of NIE 13-54, "Communist China's Power
Potential through 1957,n 3 June 1954. A new NIE covering these
questions is scheduled for preparation in the fourth quarter of 19550
NIE 13-55, "Communist China's Capabilities and Probable Courses of
Action in sia through 1960.0
** Except where otherwise indicated explicitly or by context, *Thine
and "Chinese?11 as used hereafter, refer to Communist China and the
Chinese Communists.
Copy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
25X1
II-B
Page 2 of 6 Approved For Release 2M/UNFTCIA-RDP67-00059A000100010002-7
certainly are in contact with Chinese leaders, but it is unlikely that
they issue direct orders. The USSR is able to exert influence over
Chinese policies primarily by virtue of their common ideology and
China's economic and military dependence on the USSR.
The Communist regime has vigorously and ruthlessly set about
establishing political control over the Chinese people. To de this,
it has employed a wide array of programs, ranging from inducements and
patriotic appeals to coercion and terror.
The Obnmunists have had considerable success in winning support
from certain government workers, members of the armed forces, skilled
industrial workers and particularly the youth.
Through terror and force, the Communists have eliminated the
landlord class and thousands of businessmen,, professionals, and former
government officials. There is no evidence of significant organized
resistance. To insure its control, the regime has established extensive
security forces in addition to the army.
Although much of the voluntary support the regime received in 1949
has been dissipated, such dissatisfaction as now exists in China has
neither the universality, the intensity, nor the physical means by which
to transform itself into effective resistance.
China's domestic interest, international relationships, and long-
term aspirations have resulted in a foreign policy along these broad
lines: (a) maintenance of the alliance with the USSR; (b) aid to
indigenous Communist parties and groups in non-Communist Asian countries;
(c) continued application of political warfare pressure against non-
Communist Asia, and intense military and political pressure against the
Chinese Nationalists*; (d) diplomatic and propaganda efforts designed
to enhance China's prestige and world status. Such a policy appears to
be designed to further China's domestic and international objectives
without provoking full-scale conflict with the West. It also appears
to be based on the belief that time will work to Communist advantage in
achieving China's international aspirations.
See NIE 16572757.7-77Communist Capabilities and Intentions with Respect
to the Offshore Islands and Taiwan Through 1955, and Communist and
Non-Communist Reactions with Respect to the Defense of Taiwan,"
16 March 1955.
1 41..11 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET 1I-B
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7page 3 of 6
?00, Economic
China is en underdeveloped agricultural opuntry with a population of
600 million. China's 1952 estimated gross national product (GNP) of approx-
imately US $27 billion* was less than one-third of Soviet and about one-
fourteenth of US GNP. China's per capita GNP of less than roughly US $46
is not quite equal to that of India and only one-quarter that of Js.pan. While
there are the beginnings for a modern industrial development, the present
contribution of the industrial sector to total output is small. The
regime faces a formidable task in achieving its long-term goal of a
modern industrial economy.
By 1952 the Chinese national budget had risen to about a third of
the GNP, a substantially lower proportion than in the case of the USSR.
The two most important categories of budget expenditures during this
period have been military outlay and capital investment.
In 1949 production was extremely low. By the end of 1952, the
Chinese had succeeded in general in rehabilitating the economy. Steel
production exceeded by roughly one-quarter the highest levels reached
between the years 1937 and 1945; grain and power production were slightly
above this level; and coal output was about three-quarters of this level.
The general rise in domestic production and trade, the great expansion
of overland trade between the Soviet Bloc and China, and the movement of
military supplies to Korea have increased demands on Chinese transport
capacity. The regime has almost restored the rail net as it existed in
1945. The ComMunists.have also brought to completion more than 1,600
miles of new lines (as of the end of 1954). However, the rail net is
still inadequate in many areas. Drastic measures are being amployad to
stretch present capacity. Other forms of transport have played a smaller
part in the regime's program.
Although the Communists have made considerable progress in rehabilitating
the Chinese economy, the basic pattern remains unchanged. Agriculture
is still the primary activity and per capita production is stil3 low. More-
over, the geographic concentrations of economic activity within China
remain substantially unchanged.
On the other hand, the Communists have made a major change in the
direction and composition of China's foreign trade. In 1938 practically
all of this trade was with countries not now in the Soviet Bloc, while
in 1952 the Soviet Bloc accounted for about 70 percent of China's foreign
trade. In terms of constant dollars, 'China's total foreign trade in 1952
Estimates based on 1952 data are used generally throughout. The 1954
GNP will prove to be modestly greater, but changes since 1952 are
believed not to have altered the general order of magnitudes or the
relationships.
25X1
Approved For Release 2005/08/15 : CERIVRZ059A00010001000217PY NO.
74pril 195.5
II-B
Page 4 of 6 Approved ForRelease2A/ A-RDP67-00059A000100010002-7
NOVRE:
was roughly the same as in 1938. Imports of consumer goods in 1952
constituted a smaller proportion of the total than in 1938. Imports of
military supplies in 1952 constituted a much greater proportion of the
total than in 1938. Imports of capital goods andAmdustrial.raw materials
constituted about the same proportion in 1952 as in 1938. These changes
in direction and composition have come about in part because of China's
new political relationship with the Soviet Bloc, in part because of
Western trade restrictions, and in part because of the requirements of
China's programs of economic and military development.
Pllitary
The internal control and the international power position enjoyed
by the Communist regime rest largely upon the power potential of China's
military establishment. Within China, the armed forces hold a position
of unique privilege and per in the state hierarchy. The loyalty of the
mLitary forces adds greatly to the regime's power to coerce the people.
The Chinese military establishment is at present the largest of any Asian
nation, with over 2* million men in the field forces and an actual air-
craft strength of more than 1,500. These forces, supported by the USSR
and greatly improved by the Korean War, have given the Comnunists an
overwhelming military advantage over the countries of non-Communist Asia
and have profoundly affected the over-all balance of power in Asia.
The Chinese air capability was not fully tested in Korea. The
Chinese have a fair capability in air defense, but only under good
visibility conditions. The Chinese Air Force has some capability for
tactical support operations. It alsu has a sizable force of light bombers,
both jet and piston, and a few medium bombers. The Chinese Navy, though
low in over-all operational effectiveness by US standards, hs demonstrated
considerably improved effectiveness in recent small engagements in the
Taiwan Straits area. Moreover, it now is believed to operate 2-5 sub-
marines.
The major weakness of the Chinese armed forces is their lack of
domestic supply facilities and their concomitant dependence upon the
Soviet Union. At the present time this weakness would become critical
in the event of a general war in the Far East whiCh involved both the
Soviet Union and China.
Estimate of Probable Developments
The Chinese Communists have as their long-range goal the development
of a Soviet-style state in China, with its own bases of economic and
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/1P:PC1W057-00059A00010001040 5 or 6
military strength, and dominant in Eastern and Southern Asia. To this
end they will proceed, as rapidly as possible, through the forced and
ruthless measures characteristic of Communist regimes, to reorganize the
social structure along Communist lines, improve the effectiveness of the
administrative system, and develop the economy to the extent feasible.
The regime will devote Substantial resources to modernizing and strengthening
its armed forces as a power base for its foreign policy.
Although the Chinese plans for economic development are not known
in detail, it appears that these plans contemplate an increase in total
output in 1957 to 20-25 percent above the 1952 level. Emphasis is placed
upon increasing the output of the modern industrial sector, particularly
heavy industry and transport. Fulfillment of the regime's economic plans
depends upon increasing agricultural output while rigorously restricting
consumption so as to provide the resources needed to support the industrial
investment and military programs. A large part of the capital goods needed
to fulfill the proaram will have to be obtained from the rest of the
Soviet Bloc in return for Chinese exports. Available resources will have
to be efficiently al]ocated to ensure that crucial sectors of the economy,
such as transport, meet the demands generated by increasing production.
. Barring a major crisis or other unpredictable event, it is probable
that China will have attained by 1957 a GNP of roughly US $32 billion,
an increase of 20-25 percent over the 1952 figure. It is probable that
agricultural output will be about 10 percent higher than in 1952, and
the output of the modern industrial sector of the economy 70-100 percent
higher. The increases in individual industries (including transportation)
will of course vary widely from this over-all rate of increase. Even
by 1957, however, the Communists will only have begun the modernization
of China's economy. The country will as a Whole remain agrarian and
underdeveloped.
It is probable that by 1957 the Chinese regime will have increased
its administrative efficiency and have further tightened its mitrol over
its people and resources, but the regime will not have been able sub-
stantially to alter traditional social patterns or to obtain more than
passive acceptance from the bulk of the population. However, the regime's
ability to direct and control China will probably not be significantly.
impaired. Furthermore, the regime will probably be able to master leader-
ship problems that are likely to arise, even in the event of the death
or retirement of Mao Tse-tung.
It is probable that the military establishment will gain in strength
and effectiveness during the period through 1957 as a result, of the regime's
program of modernization and training. Soviet assistance will continue
to be essential to the fulfillment of this program.
Copy No.
TDP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
II-B
Page o
Approved For Release 20R0?/WEIA-RDP67-00059A000100010002-7
or o
China's dependence on the USSR will probably not be significantly
lessened by 1957, and maintenance of the alliance with the USSR will
continue to be a dominant aspect of China's foreign policy. The Chinese
Communist regime will continue to consolidate its political position,
to gain in economic and military strength and by 1957 will be a more
powerful force in world affairs than at present. Certain aspects of
China's development will be used to support claims that time is on the
Communist side in Asia. China's increased power and prestige will present
a challenge to the influence of the Western nations in Asia, and to the
Asian leadership aspirations of India an Japan.
1 April 1955
TOP SECRET 41111
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/M9s:EERTRDP67-00059A0001000
age2- f 5
SOVIET BLOC
THE EUROPEAN SATELLITES*
(See charts knowing these pages)
Soviet Policy
Soviet policy in the Satellites is directed toward developing
them into a strong area of the Soviet empire which will increase
Soviet power and strengthen the Soviet world position. Soviet con-
trol of the Satellites is based on the Soviet armed forces stationed
in Eastern Europe, on the MVD (Soviet security services), on Soviet
diplomatic, economic, and military missions in each Satellite, on
individual Soviet citizens in key positions, and is exercised
through the Satellite Communist parties and governments.
The Satellite Communist parties, the leaders of which are
approved by the Kremlin, constitute the principal instrumentality
for implementing Soviet policy. The subservience of the Satellite
Communist parties to the new Soviet rulers is complete.
The Soviet Union exercises control over the economic development
of the Satellites by fixing over-all production goals and priorities,
and by supervising their foreign trade. Satellite economic plans are
prepared in accordance with general policies issued by the Soviet
Union,
The Soviet pattern of intellectual, cultural, and religious
life is being imposed upon the Satellites. The Satellite govern-
ments have a monopoly over the schools and all mass-information
media and have brought church organizations under the control of
the state. The educational system has been reorganized, and teaching
staffs and libraries have been purged. Finally, the cultural in-
fluence and autonomy of family life has been disrupted.
The USSR continues to maintain strong combat-ready forces,
totalling an estimated 531,000 army troops, 24,000 security troops,
and 1,800 aircraft (estimated actual strength) in the Satellites,
-mostly in East Germany.
25X1
Is sectionowith some updating, is a summary of NIE l2-54,"Probable
Developments in the European Satellites as They Affect Soviet
Capabilities,. through:Midir1956;1 24 August 1954. The term nSatellites"
includes East Germany, Pdland07,Ozechoslovakia? Hungary, Rumania, Bulgaria,
and Alb4nia.
25X1
Copy No.________
SECRET
1 April Im
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
II-0
Page 2 -Approved For ReleZACM/15 : CIA-RDP67-00059A000100010002-7
of
The relationship between the Satellites and the USSR remains
basically unchanged since the death of Stalin, but the new Soviet
leadership has adopted a more flexible attitude toward the Sate-
llites under Malenkov and more recently, under Kruschev. These
changes, , however, represent a refinement of method rather than a
reduction in control.
The Satellite leadership groups, which have become almost
completely reliable through a continuous process of selection and
purging, remain virtually unchanged. Moves taken by the Satellites
to give a greater appearance of "collective" leadership are probably
imitations of the Soviet pattern. The USSR continues to place great
emphasis upon strengthening the Party position in the Satellite countries.
The principal obstacle to the Sovietization of Eastern Europe is
the continued opposition of the Satellite populations. However, the
effectiveness of this opposition is severely constricted by the con-
trols imposed on every aspect of the lives of the people. There is
virtually no organized active resistance and only little unorganized
active resistance. On the other hand, passive resistance continues
to be widespread and to constitute a serious drag on economic programs.
The more prevalent forms of passive resistance are worker absenteeism,
work slowdowns, crop-delivery evasion, increased church attendance,
and whispering campaigns.
The imminent approval of West German rearmament has caused the
USSR to call at least one Satellite conference during the past six
months, probably for the double purpose of establishing a solid
political front and preparing for an integrated Satellite defense
command to offset the growth of West German military strength.
Economic
In 1953, the Satellites undertook revisions of economic plans
which -- like the plan revisions in the USSR -- were aimed at in-
creasing the production of agricultural commodities, especially food-
stuffs, and of manufactured consumer goods. These revisions were
occasioned mainly by the adverse cumulative effects of overemphasis
on heavy industry at the expense of agriculture and light industry.
The various Satellite economies have now virtually reached the point
in their development where manpower, raw materials and plant will be
the controlling factors in their growth, rather than any shifts in
emphasis promulgated by the Soviet leadership.
Over-all Satellite industrial production was back to the 1938
level by 1951 and in 1953 it was about 25 percent above the prewar
level. The most impressive growth hasbeen in the production of
machinery andequipment, chemicals, metals, energy, and building
materials, generally in that order.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005i1011?gWIRDP67-00059A0001000-14062-7
Page 3 of 5
In contrast, Satellite agriculture has lagged seriously.
Although the output of industrial crops returned to the prewar
levels between 1948 and 1950, over-611 agricultural production has
not yet regained the prewar level of production. Over-all agri-
cultural output in 1951 was an estimated 14 percent below the prewar
level, but it slipped back in 1953 to approximately 21 percent below
that level.
Total agricultural collectivization continues to be the? ac-
knowledged long-term goal of Satellite governments. However, the
Satellite leadersof East Germany, Czechoslovakia, and especially
Hungary, have attempted to encourage production by private peasants
by offering temporary concessions.
By the end of 1953, the combined GNP (Gross National Product)
of the Satellites had returned approximately to the level of 1938.
Total Satellite GNP in 1953 was an estimated 45 billion of 1951 US
dollars Or about two-fifths that of the USSR. In 1953 Poland, East
Germany, and Czechoslovakia contributed over 80 percent of the
total Satellite GNP, while Hungary, Rumania, and Bulgaria (in that
order) accounted for less than 20 percent.
The most important development in Satellite foreign trade has
been its reorientation away from. Western countries toward the Bloc.
The trade Of the Satellites with the West declined from more than
four-fifths of their total trade before the war to less than one-
third in 1951 and 1952. During the same period, Satellite trade
with the USSR increased from one-hundreth to over one-third of the
total trade.
The scientific and technical capabilities of Eastern Germany
and Czechoslovakia, and to a lesser extent Hungary and Poland,
constitute substantial additions to those of the USSR. In parti-
cular, the electronics and communications research capabilities of
East Germany, Czechoslovakia, and Hungary, and the optics research
capabilities of East Germany are of considerable value to the Soviet
Union.
The main contribution of the Satellites to the Soviet nuclear
program is in uranium ores and concentrates. It is probable that
East Germany is currently providing about half of Bloc production of
uranium ores and concentrates. The other Satellites are less import-
ant sources. The USSR, however, is not dependent upon Satellite
sources. If necessary, the Soviet atomic energy program could probably
be supported at its present level of operation from internal Soviet
sources alone.
uopy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Page 4 of
5Approved For RelegR2NYM15 : CIA-RDP67-00059A000100010002-7
Military
The strength of the Satellite ground forces is estimated at
1,115,000 men organized in 82 line divisions, of which 6 are
armored and 13 medhanized. These forces are supplemented by Sate-
llite security troops which total about 306,000 men. The USSR
controls these Satellite forces by direct Soviet staffing in Poland
and by large Soviet military missions in all other countries.
The Satellite armies are equipped largely with Soviet World
War II material of good quality, but they require substantial
amounts of additional supplies and equipment for sustained combat.
They are dependent, upon the USSR for most of their heavy equipment.
The questionable political reliability of the Satellite armies
places a significant limitation upon their military usefulness. At
present the Kremlin could probably not ray upon the majority of the
Satellite armies in a general war except for employment in secondary
roles or in a defensive capacity*
The Satellite air forces now have an estimated TOO strength
of 3,600 aircraft of all types (approximately 2,400 actual). Piston
fighters continue to be replaced by jet fighters, and other equipment
is being modernized. Training is being improved.
The current operational capabilities of these forces are un-
evenly developed. Ftrthermore? the political reliability of the
Satellite air forces, like that of the Satellite armies, is question-
able.
Owing to their small size, their meager equipment, and the
unreliability of the personnel, the Satellite navies lack the
capability of making more than a minor contribution to Soviet naval
strength.
Estimate of Probable Developments.
The Kremlin almost certainly regards the maintenance of the
Soviet position in Eastern Europe as essential for: (a) safe-
guarding the military security of the USSR through possession of
advanced bases and defensive positions outside Soviet frontiers;
(b) adding to the economic and military resources of the USSR;
(c) upholding the prestige of the USSR in its role as leader of
the world Communist movement; and (d) checking the re-emergence
of a powerful Germany allied with the west. It is likely, there-
fore, that the Kremlin will continue to push forward its long-term
plans for integration of the Satellite countries into the Soviet
system, though almost certainly not, during the next two years, to
the point of outright incorporation into the USSR.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/eVI&A31bI1RDP67-00059A0001000406277
Page 5 of 5
Soviet control of the Satellites remains virtually complete
and is unlikely to diminish or to be successfully Challenged from
within during the next two years. Although the principal Obstacle
to the Sovietization of Eastern Europe is and will continue to be
the opposition of the Satellite populations to Communism and Soviet
domination, this opposition alone will not seriously impair Soviet
control or threaten the stability of the Satellite governments.
The revisions of Satellite economic plans have not altered
the Kremlin's basic aim of increasing as rapidly as practicable the
Satellitesl.contribution to Soviet economic power. The 1953 re-
visions were aimed primarily at removing the threats to future
industrial growth by correcting the imbalances in the Satellite
economies resulting from an overemphasis on heavy industry at the
e:Lpense of agriculture and light industry. In essence, they provide
for slowing down the expansion of heavy industry in 1954-1955 and
for increasing the resources allotted to agriculture and consumer
industries. Nevertheless, Satellite economic policies will still
be strongly oriented toward development of heavy industry. At the
same time, defense outlays will probably be maintained at approxi-
mately present or only slightly higher levels. These revisions
have not resulted in any significant improvement in the standards
of living and it is probable that the Satellite governments in two
years time will be faced with much the same basic economic problem
as at present.
It is estimated that total Satellite GNP in 1953 was about
two-fifths that of the USSR and that the Satellite.share-of total
Bloc GNP will remain substantially unchanged through 1956. During
this period the growth rate will probably average about 4 percent
annually as compared with an average of 6 percent annually from
1948 through 1953.
The Satellite armed forces have become a substantial element
in the balance of military power in Europe. It is probable that
the Satellite armies will reach an over-all peacetime strength
of approximately 1,265,000 men by mid-1955 and that no substantial
increase is likely thereafter. It is estimated that by mid-1956
the Satellite air forces will probably have a TOgeE strength of
4,400, of which 2,450 will probably be jet fighters. During the
next two years Czech and Polish production will probably be adequate
to meet all Satellite peacetime requirements for jet fighters and
ground-attack aircraft. It is likely that while the Satellite
armed forces would probably fight well against traditional enemies,
their reliability will remain sufficiently questionable during the
next two years to place a significant limitation upon their military
usefulness in event of general war,
uopy no.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
51.2
1938 1953 1956
Approved For Release 2005/0811( : CIA-RDP67-00059A000100010002-7
SATELLITES*
ESTIMATED GROSS NATIONAL PRODUCT
1938, 1953, and 1956
(Billions 0c1951 US Dollars)
1.0
1.4 1.6
m
8.4
9.2
1938 1953 1956 1938 1953 1956
ALL SATELLITES* BULGARIA CZECHOSLOVAKIA
13459 CIA, 8-54
17.1
1938 1953 1956
EAST
GERMANY
2.5
1938 1953 1956
HUNGARY
3.7
16.3
1938 1953 1956
POLAND
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
II?C
Figure 1
3.0 2.9 3'3
1938 1953 1956
RUMANIA
*Excludes Albania
SECRET
100%
Trade
Services
Agriculture
Transportation and
Communications
Construction
Industry
Approved For Release 2005/08/1i : CIA-RDP67-00059A000100010002-7
SATELLITES*
ESTIMATED DISTRIBUTION OF GROSS NATIONAL PRODUCT
BY SECTOR OF ORIGIN, 1938 and 1953
an Percent)
.5
1938 1953 1938 1953
1938 1953
ALL SATELLITES* BULGARIA CZECHOSLOVAKIA
13460 CIA, 8-54
1938 1953
EAST
GERMANY
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
1938 1953
HUNGARY
II?C
Figure 2
1938 1953
POLAND
1938 1953
RUMANIA
*Excludes Albonia
SECRET
Approved For Release 2005/08/15,: CIA-RDP67-00059A000100010002-7
SATELLITES*
ESTIMATED PRODUCTION INDICES
1938 and 1953
1950=100
II?C
Figure 3
INDUSTRY SUBSECTORS
Energy
Metals
Machinery and
Equipment
Chemicals
Building Materials
Forest Products
Food Processing
Light and Textile
100
94
129
100
gENME 84
AV
125
157
A 144
100
121
123
130
IIMEMENI
-4
64
A%
IM?MMTME,
MENMEMI
240
24
,="51
,y
279
211
30
M.11.111
MININ11111111111111
96
124
149
183
161
-
80
r
109
93
99
126
130
A
AY
r 132
118
A 150
104
98
01
194
105
M=12
113
103
81
,EMErgnian
173
152
EAST GERMANY
Energy
Metals
Machinery and
Equipment
Chemicals
Building Materials
Forest Products
Food Processing
Light and Textile
34
160
158
**
**
,Y a
* *
.0/
136
125
111
99
BULGARIA
13461 CIA, 8-54
113
47 4
131
418
370
KEY
IMEM 1838
1953
Approved For Release 2005/08/15 : CIA-RDPgiE1r000100010002-7
fal, 987
POLAND
8NE
mmeimmeki
66
100
V, 4
97
MINNIMMIMI
'7 4 153
MEMENENMEM
;.????=mine
UMMM'
=17 1
10108
135
159
95
119
118
HUNGARY
178
171
CZECHOSLOVAKIA
100
93
4Y 4
100
136
r? A
172
159
181
rozWEE
101
.......
98
RUMANIA
116
119
150
136
*Excluding Albania
**Zero or negligible
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
SECRET
II?C
Figure 4
SATELLITES
ESTIMATED GEOGRAPHIC DISTRIBUTION OF TRADE
1936-38 AVERAGE and 1951
(In Percent)
CHINA 1 CHINA 1
USSR USSR 1
SATELLITES
NON-BLOC
2
84
31
SATELLITES
13462 CIA, 8-54
NON-BLOC
100%
1936-38 1951 1936-38 1951
EXPORTS IMPORTS
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15?FIMW67-00059A0001000100k2at
SOVIET rwut,
Page 1 of 3
E. REVIEW' OF CURRENT COMMUNIST ATTITUES.
TOWARD GENERAL WAR*
Chinese Communist Attitudes
Chinese Communist propaganda and diplomatic representations demonstrate
that the regime is strongly committed to the "liberation" of Formosa, the
Pescadores, and the offshore islands. The Chinese Communist leaders give
every indication of holding to this position. Moreover, Peiping has long
regarded the continued presence in the Formosa Strait and on Formosa itself
of a Nationalist China supported militarily by the US as at least a long-
range threat to its security.
We believe that the Chinese Communists will refrain from courses of
action which they estimate will involve them in full-scale warfare with
the United States.
However, we believe that the Chinese Communist attitude with respect
to war is bold, sometimes boisterous, sometimes sophisticated, and that the
Chinese Communists are therefore likely to test the upper limits of US
tolerance with a variety of substantial military actions. Moreover, in the
light of Chinese Communist activities in recent months and their reactions
to the recent US policy pronouncements on the defense of Formosa and the
Pescadores, we are not confident that the Chinese Communists clearly under-
stand which, if any," of the offshore islands the US would defend with its
own forces, the circumstances under which the US would defend them, or the
extent to which the defense would be carried. We believe, therefore,
that the Chinese Cbmmunists may miscalculate the degree of risk which
military actions on their part in this area would entail.
In any event, we believe that the Chinese Communists will probably
take military action against the offshore islands of sufficient scale
to test US determination to halt their advance at some point. They might
even*** attempt to take Quemoy, Matsu, or Nanchi regardless of whether
they estimated that the US would participate in the defense of these islands.
*This section contains the text of SNIE 11-4-55, "Review of Current Communist
Attitudes Toward General War," 15 February 1955. NIE 11-4-54, "Soviet Capa-
bilities and Probable Courses of Action through Mid-1959," has dealt with this
problem on a long-term basis. The above estimate is confined to a short-term?
and is written primarily with reference to the situation respecting Formosa
and the offshore islands.
**The Deputy Director for Intelligence, The Joint Staff, would delete the
words "if any."
***The Assistant Chief of Staff, O-2, Department of the Army, believes that the
word e "might even" should read "probably will."
Approved For Release 2005/08/15X)CIA1ZIPM7-00059A000100010
25X1
)02-7
LaPpy NO. /j
28 February 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7 ?
II-E TOP SECRET
Page 2 of 3
They may not be convinced, in the light of the restraint exercised by US
policy in Korea and Indochina, that the US would in fact react to attacks
on the offshore islands by attacks on the mainland. Or, they may believe
that the scale of any US reaction, even if it involved some attacks against
the mainland, could be controlled by them, perhaps by diplomatic action at
a critical juncture, in which they would count heavily on the restraining
influence of US allies on US policy. Finally, they may believe that the US
would not be willing to react to their actions in ways which could lead by
stages to full-scale war against them, and perhaps eventually to war invol-
ving the USSR. If the Communist judgments did in fact prove to be mistaken,
a series of actions and counteractions might be set in train which could
bring about unlimited hostilities between Communist China and the US.
Soviet Attitudes
We believe that the Soviet leaders view general war as a hazardous ,gamble
which could threaten the survival of their system. Accordingly, we believe
that they will not deliberately initiate general war, and will try to avoid
courses of action which in: their judgment would clearly involve substantial
risk of general War. We believe that the recent changes in Soviet leader-
ship do, not indicate any increased disposition on the part of the regime to.
risk such a war.
,The Kremlin would.,not be deterred by the risk of general war from
taking counteraction 'against any Western action which it regarded as, an
imminent .threat to its security, ,.However, we see no evidence that he
Kremlin estimates any recent action by the Western Powers, including
progress so far made toward German rearmaments, as constituting such an
imminent threat.
The new Soviet leadership has express'd "full approval and support" for
Chinese Communist mpolicy" with respect to Formosa and the offshore islands,
but has left uncertain the extent to which the USSR would support a Chinese
Communist effort to take Formosa and the offshore islands by military. action.
We believe that Moscow might see certain advantages in clashes between Chinese
Communist and US forces, at least as long as it believed that the clashes
would be limited and localized. Both Soviet and Chinese Communist leaders
probably estimate that strictly local cpnflict between the Chinese Communists,
and the US, with the accompanying increase of international tensions, would
serve their interests. They may estimate, for example, that the US in these
circumstances would not have the support of its allies or of world opinion
in a defense of the offshore islands, and that the result would be an in-
creasing isolation of the US. Under these circumstances they might believe
that US progress toward its objectives elsewhere, including West German
28 February 191.0.0roved For Release 200A69,8VEtliEA-RDP67-00059A000100010002-7
Approved For Release 2005/08/1W5W67-00059A00010001011
Page 3 of 3
rearmament, would be impeded, and that Soviet aims would thereby
be served.
However, the Kremlin would almost certainly be concerned that military
conflict between the US and Communist China could not be kept limited and
localized. It would almost certainly estimate that unlimited war between
the US and Communist China not only would endanger the existence of the
principal ally of the USSR, but also would involve substantial risk of
spreading into general war. Hence, it would probably attempt to exert a
restraining influence if it judged that appreciable danger of unlimited
war between the US and Communist China were developing. If such war did
occur, we believe that the USSR would support its ally in carrying on the
war, but would not assist with its own forces to such an extent as, in its
judgment, would cause the US to attack targets in Soviet territory.
We believe that the USSR would openly intervene in the war if the Soviet
leaders considered such intervention necessary to save the Chinese Communist
regime, but the Soviet leaders would still try to confine the area of hos-
tilities to the Far Zast.*
*The Director of Naval Intelligence and the Deputy 'tractor for Intelligence,
The Joint Staff, believe that the following should be substituted for the
last sentence:
"Should the conflict progress so far that destruction of the Chinese
Communist regime appeared imminent, we believe that the Soviet leaders
would recognize that open intervention on their part against US forces
sufficient to save the Chinese regime would involve grave risk of general
war with the US. Their decision would probably be based on existing
military, political, and economic strengths, with particular emphasis on
the current disparities in nuclear stockpiles and delivery capabilities.
We believe that the SOviet leaders would probably conclude that if
they intervened, the conflict could not be confined to the Far East,
and that Soviet strengths were insufficient to risk their own regime
in this manner."
TOP SECRET
25X1
Copy No. 7 7
28 February 3_955
Approved For Release 2005/08/15: CIA-RDP67-00059A000100010002-7
? Approved For Release 2005/0Foy ?sig41:)P67-00059A00010001990?-7
Page 1 of 4
SOVIET BLOC
F. Probable Soviet Response
to the Ratification of the Paris Agreements*
ROLE OF GERMANY IN POSTWAR SOVIET POLICY
The role that a restored Germany wouId eventually come to play
in Europe has been a key issue in the postwar power Struggle between
the USSR and the Western Powers. Despite the tremendous postwar
growth of Soviet power (=pared with that of Germany, Soviet fear
of Germany, sustained by the memory . of Nazi aggresSion?-has remained
4 powerful force. Soviet policy in Europe since 1945 has been de-
signed to prevent any German settlement which would permit the align-
ment of a rearmed Germany on the aideof the Western Powers. This
policy has apparently:been based on a belief that the addition of
German power to the Western alliance would constitute a serious blow
to patriot prestige, would seriously hamper further Communist ox-
pan ion in hrope, threaten Soviet control over the Satellites, and
perhaps even Jeopardize the security of the USSR.
PROBABLE SOVIET ESTIMATE OF THE SIGNIFICANCE OF RATIFICATION
The rearmament of even West Germany and its inclusion in the
NATO alliance is almost certainly viewed by the Soviet leaders in
a perspective of suda risks and danger*. They probably doubt that
West German military forces would be kept within the proposed
limits, and probably recognize that the net increase in the strength
of the military combination which the USSR confront* in &rope would
be greaterthan indicated by the simple addition Of a particular
number of West German divisions, On the other hand? the Soviet
leaders probably estimate that it would require :about three years
to complete the proposed rearmament program in West Germany.' They
would :probably consider, therefore, that the.potentialAhreat in-
volved in West GerMan rearmament would not emerge at an slay date
and that there would remain time fpr possible counterbalancing
developments.
* This section is an abstract of NIE 11-55, "Probable Soviet
Response to the Ratification of the Paris Agreements,"
I March 1955.
. copy No.
POP SECRET 1 4ril 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
II-F
Page 2 ofkifroved For Release 164E/TAT: CIA-RDP67-00059A000100010002-7
PROBABLE SOVIET COURSES ()FACTION
We believe it unlikely, therefore, that the initial Soviet
response to ratification of the Paris Agreements would be based on
the assumption that the security of the USSR was immediately en-
dangered. We believe that the USSR would take measures to improve
its military position, would employ all political and subversive
means to prevent or impede rearmament in West Germany and to
obstruct its cooperation with its Western partners, and would
attempt to compensate elsewhere, under conditions of limited risk,
for the accretion to Western strength resulting from Wrest German
rearmament. This general pattern of response would exclude a
military action which, in the Soviet view, would involve sub-
stantial risk of general war. It would also exclude major con-
cessions which could provide the basis of a German settlement with
the Western Powers.
In conjunction with this general line of strategy, we do not
believe that there would be any fundamental shift in the Soviet
public posture, but the USSR might for a time adopt a more menacing
attitude. In view of the vigorous campaign they have made against
ratification, the Soviet leaders would probably take some of the
measures they have threatened, notably the denunciation of the pacts
with the UK and France, and the establishment of an East European
defensive system. They might even invoke the terms of the Soviet-
Finnish Mutual Assistare Treaty of 6 April 1948.
Attitude Toward Negotiations on Germany. We believe it unlikely
that the USSR would participate in four-power negotiations on
Germany for some time after ratification. Nevertheless, the Soviet
leaders recognize that the German desire for unity will persist and
that, as long as the USSR retains the capability to grant or withhold
unification, it may be able to inhibit the pace and reduce the scale
of German rearmament through negotiations, or the promise of negotia-
tion. For these reasons, we believe that the USSR would be willing,
after an interval, to negotiate further on Germany. However, it is
highly unlikely that the USSR would agree to German unification on
terms that would be acceptable to the West.
Berlin. Since we estimate that the Soviet response to ratification
would not include any moves which would entail substantial risk of
war, we do not believe that the Soviet leaders would take strong
measures to force the Western Powers out of Berlin. Nevertheless,
West Berlin border controls would probably be tightened and there
would probably be some harassment of Western access to the city by
1 April 1955
TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/0871: U0141)P67-00059A00010001042E7
Page 3 ofL.
way of probing Western determination to maintain the Berlin position.
Such moves might be associated with an East German program to build
up defenses, and would probably be carried out by the East German
regime. In consequence there is likely to be some increase of tension
over Berlin in the period immediately following ratification. We
believe, however, that the Soviet leaders would be concerned not to
allow such a situation to get out of hand.
Austria. In the initial period following ratification, the Soviet
authorities, alleging violation of zonal agreements for Austria,
may re-establish zonal border controls, and even threaten to parti-
tion the country. We believe it unlikely, hol4ever? that the Soviet
leaders would permit any such actions to go beyond the stage of
demonstration, or that they would take any course which would limit
their freedom of action in using the Austrian issue for future
bargaining with the West.
Bloc Defense Measures. Among the measures which the USSR would prob-
ably take to improve its military posture would be the creation of
the joint command structure for Eastern Ehrope forecast at the recent
Moscow conference of Bloc states. We also believe it possible that
the USSR would strengthen Soviet forces in the Satellites, par-
ticularly in East Germany. Satellite forces may likewise be
strengthened. The East German forces are likely to be unveiled as
a national military establishment and strengthened somewhat, possibly
by the introduction of conscription.
The USSR would probably accelerate the strengthening of its own
armed forces if German rearmament showed signs of successful imple-
mentation. However, we see no indication, even in the most recent
Soviet budget, of an intention to begin an early rapid build-up of
Soviet armed strength. Since the Soviet leaders probably believe
that ratification of the Paris Agreements poses a potential rather
than an immediate threat to Soviet security, we believe that Soviet
policy will continue to emphasize long-term qualitative improvement
rather than short-term enlargement of its military forces.
If at any stage in the process of implementing the Paris Agree-
ments the various courses of action described above did not, in the
Soviet view, sufficiently offset the developing threat of German
rearmament, we believe the Soviet leaders would almost certainly
take further measures in the attempt to counter this accretion to
the strength of the West. These measures would include primarily
a sharp build-up of Soviet and Satellite military capabilities.
uopy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15: CIA-RDP67-00059A000100010002-7
Jame
II-F Approved For Releam2NNR15 : CIA-RDP67-00059A000100010002-7
Page 4 of 4
They might also include more threatening courses of action against
Berlin, or in the Far East, or elsewhere, with the purpose of
arousing fear of nuclear war in the West and causing Western peoples
to demand that their governments follow a cautious policy. We
believe that, at this stage, the USSR would adopt bolder courses of
action than it had previously, but would avoid those which in its
judgment clearly entailed the probability of general war.
ALTERNATIVE SOVIET COURSE OF ACTION
It is possible that the Soviet leaders may at any time decide
that they cannot adequately offset the developing threat of German
rearmament. In this case, they would be confronted with two broad
alternatives: (a) to undertake an early showdown with the Western
Powers on this subject, possibly including the use of force in-
volving grave risks of general war; (b) to attempt to negotiate a
settlement in which both Western and Soviet troops would be with-
drawn and a reunified Germany would be neutralized with controlled
armaments. We believe the USSR would reject the first alternative
as too hazardous a gamble under currently prevailing circumstances.
In view of the grave disadvantages entailed, we believe the second
alternative is only a possibility, but it might be adopted if the
Soviet leaders believed it offered the only means, short of general
war, to prevent the development of a critical threat to the security
of the USSR. We believe, however, that the Kremlin would be more
likely to adopt the courses of action described in the preceding
paragraph.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III. FAR EAST
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
?
Approved For Release 2005/08/Er. 8g-MTP67-00059A000100010014reAl of
FAR FAST
? Communist Courses of Action in Asia *
Through 1957 **
Although the USSR possesses preponderant influence in the Sino-
Soviet partnership, the main outlines of Communist policy in Asia are
almost certainly determined jointly by consultation between Moscow and
Peiping, not by the dictation of Moscow. Chinese Communist influence
in the Sino-Soviet alliance will probably continue to grow. it is
estimated that such frictions as may exist between Communist China and
the USSR will not impair the effeetivenese of their alliance during the
period of this estimate.
The Communists will attempt to impress free world countries,
particularly Japan and the Asian neutrals, with their willingness to
negotiate outstanding issues. In so doing, they will probably make
proposals from settlements which may be attractive to BOMA non-Communist
nations but contrary to US interests, and, as at Geneva, may on occasion
make significant procedural and tactical concessions. Communist China
may attempt to negotiate, on the basis of the Chou-Nehru five points,
a series of mutual nonaggression coexistence understandings with most
of its Asian neighbors. In these efforts, the Communists will continue
to seek greater recognition and acceptance of the Peiping regime, and
to hold out the promise that Asian and world problems can be solved by
? Great Power deliberation if Peiping is permitted to participate therein.
/n addition, the wisdom of closer diplomatic ties with Peiping will be
impressed upon non-Communist Asia by constant exaggeration of Communist
China's strength, progress, and peaceful intent. The Communists will
almost certainly make every effort to publicize the attractive possibility
for non-Communist nations of increased trade with the Bloc. It is
probable that Communist China will continue to exchange trade missions
with many non-Communist countries and to negotiate trade agreements, both
formal and informal, which express hopes of a high level of trade and
disapproval of trade restrictions.
* .Asia,as here used, includes Japan, Taiwan, the Philippines, Indonesia,
Ceylon, and all of mainland Asia east of (but not including) Iran
and Afghanistan.
** This section is largely a summary of NIB 10-7-54, l'Communist Courses
of Action in Asia through 1957," 23 November 1954.
COPY NO.
TDP SECRET 1 April- 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
25X1
III-A
Page 2 of 4Approved For Release 200E8PIPEA-RDP67-00059A000100010002-7
The Chinese Communists will continue their efforts to subvert and
exploit the overseas Chinese in Southeast Asia. The degree of Communist
success in exploiting the overseas Chinese will be strongly influenced
by the over-all fortunes of Communist China. However, because the usefulness
of most of these Chinese is limited (their members are apolitical, culturally
isolated, and disliked by the indigenous populations), the Communists will
probably concentrate their activities primarily on the governments and
indigenous populations of Southeast Asian countries.
Communist China will continue to regard the eventual "liberation"
of the offshore islands, the Pescadores, and Taiwan as a basic national
objective essential to its security, characterizing the issue as an
internal affair in which foreign interference will not be tolerated.
Hence, this issue will continue to present the greatest danger of large-
scale warfare in Asia.
? It is estimated that as long as the US remains firmly committed
to defend Taiwan and the Penghuss the Chinese Communists will almost
certainly not attempt to invade through at least 1955. Short of invading
Taiwan, the Communists will almost certainly concentrate on an interim
policy of subversion and other means of softening up Taiwan for ultimate
takeover. An intensive propaganda campaign designed to induce defection
by offering amnesty to all save Chiang Kai-shek has already begun.
Available Chinese Communist strength in place is such that the Chinese
Communists have the present capability -- at the risk of heavy casualties --
to seize the Quemoy and Matsui groups if defended solely by the Chinese
Nationalist forces. The Chinese Communists will probably undertake air,
naval, and artillery attacks against Quemoy and the Matsus and attempt
to seize poorly defended island outposts within the area. They will also
seek to erode Nationalist ability and determination to hold these islands,
and to probe US intentions. Should they become convinced the US was
determined to prevent the seizure of an island, they mould probably be
deterred from attempting dldh a seizure in the near future.
It may not be possible for the Chinese Cbmmunists? as a result of
their probing actions alone, to ascertain the full extent of a possible
US counteraction to an attempt at seizure of an offshore island. If the
US did not respond to initial probing actions, the Chinese Communists
might estimate that the US would not in fact commit its own forces to
the defense of the island. Or, even though there was sane US military
reactiem to a probing attack, the Chinese Communists might still estimate
that US counteraction to an actual invasion of offshore islands would
remain limited and localized. Or, the Chinese Communists might estimate
that they could overrun an offshore island before effective US counter-
action could be brought to bear and that the US would not subsequently
initiate major hostilities in order to regain the captured territory.
1 April 1955
TOP SICRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/1 : Mi9i'67-00059A00010001ooRre43 of
In any of these circumntances, we believe the Chinese Communists would
probably attempt to seize or complete the seizure of the offshore islands:*
It is estimated that the Vietminh now feels that it can achieve
control over all Vietnam without initiating large-scale warfare. Accordingly,
it is estimated that the Communists will exert every effort to attain power
in South Vietnam through means short of war. Should South Vietnam appear
to be gaining in strength or should elections be postponed over Cbmmunist
objections, the Cammunists probably would step up their subversive and
guerrilla activities in the South and if necessary would infiltrate
additional armed forces in an effort to gain control over the area. How-
ever, it is estimated that they would be unlikely openly to invade South
Vietnam, at least prior to July 1956, the date set for national elections.
Elsewhere in Asia (the Nationalist-held offshore islands and South
Vietnam excepted as per the above paragraphs), the Communists will probably
not, during the period of this estimate, initiate new local military
actions with identifiable Soviet, Chinese Communist? North Korean, or
Viet Minh forces.
The Asian non-Communist countries are dangerously vulnerable to the
expansion of Communist power and influence because of their military
weaknesses and consequent fear of antagonizing Communist China, their
political immaturity and instability, the social and economic problems
they face, and the prevalence of anti-Western nationalism. The effect
of the Geneva COnference and subsequent events has been to increase this
vulnerability. Accordingly, the' Communist leaders almost certainly estimate
that they have a wide area of maneuver open to them in Asia in which they
can safely continue efforts at subversion and support of armed insurrection
without incurring unacceptable US counteraction.
COmmunist policy during the period of this estimate will probably seek
to continue a stabilized situation in Korea. It is estimated that the chief
features of this policy will be: (a) to refrain from renewing hostilities in
Korea, but to be militarily prepared for a resumption of hostilities; (b)
to refuse to accept any settlement in Korea Whidh either endangers continued
Communist control of North Korea or precludes hope of eventual COmmunist
control of All Korea; (c) to rehabilitate North Korea and to strengthen its
military and economic power; and (d) to attempt to weaken the ROK by
infiltration and subversion.
* The preceding paragraphs on Taiwan and the offshore islands were drawn
from NME100-4-55, "Communist Capabilities and Intentions with Respect
to the Offshore Islands and Taiwan through 1955, and COmmunist Re-
actions with Respect to the Defense of Taiwan," 16 March 1955.
25X1
Copy NO.
TOP SLAT 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Page of 4 Approved For Release 20N0?/liFEgIA-RDP67-00059A000100010002-7
Japan and India will become increasingly important targets for
Cbmmunist ?coexistence policies and propaganda. It is estimated that
the Communists will continue their efforts to undermine Japants stability
and present orientation and will seek an expansion of economic and cultural
relations. They will make greater effort to create the impression that
their terms for a resumption of diplomatic relations with Japan are flexible,
and may offer to conclude a formal peace settlement during the period of
this estimate. It is estimated that the Communists will focus increasing
attention on India in an effort to insure at least its continued neutralism,
and if possible to bring it closer to the Communist Bloc. However, even at
the expense of friction with India, Communist China will seek to increase
its influence in the Indo-Tibetan border area.
Communist influence in Indonesia has grown considerably since the
present government took office in July 1953, and as a result of recent
political developments the government is increasingly dependent upon
Communist parliamentary support for its continued existence. It is
estimated that the Indonesian Communists will probably continue to support
the present government or, if it falls, to work for the establishment of
another government in which they would participate or in which their
influence mould be strong. They will try, through both constitutional
and illegal means, to expand their influence in the bureaucracy and the
armed forces, and to prevent the formation of a unified and effective
opposition. They will probably also attempt to strengthen their capabilities
by the organization of a Party-controlled armed force. In general, however,
they will probably avoid highly aggressive tactics in the near future, lest
these provoke counteraction by the military or by domestic opposition
groups before their own strength has become great enough to deal with it.
1 April 1955
TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/11-: CIA-RDP67-00059A000100010002-7
COMMUNIST CHINA
PARTY AND GOVERNMENT ORGANIZATION
25X1
CHINESE COMMUNIST PARTY
NATIONAL PARTY CONGRESS
(Supposed to meet every three years
to elect Central Committee, has not
met since 1945.)
THE CENTRAL COMMITTEE
(Currently has 41 regular members and
27 alternates)
POLITICAL BUREAU
Mao Tse-tung-CHAIRMAN
Liu Shao-chi-VICE CHAIRMAN
Chen Yun
Chang Wen-tien
Chou En-lai
Chu Teh
Lin Po-chu
Peng Chen
THE SECRETARIAT
Mao Tse-tung-CHAIRMAN
Chou En-lai Chu Teh
Chen Yun Liu Shao-chi
Peng Teh-huai
Tung Pi-wu
Kang Sheng
Teng Hsiao-ping
Lin Piao
REGIONAL BUREAUS
NORTHWEST-Ma Ming-fang, acting
SINKIANG-Wang En-mao
INNER MONGOLIA-Yun Tse
NORTHEAST
SOUTHWEST Ho Lung
TIBET-Chang Kuo-hua
SOUTH-Tao Chu, acting
EAST CHINA
SHANTUNG
13166 3-54 (Third Revision 5-55)
Figure 11-61
CENTRAL PEOPLE'S GOVERNMENT
NATIONAL PEOPLE'S CONGRESS
(1226 delegates elected every four years
by lower level congresses - meets yearly.)
SUPREME PEOPLE'S COURT
*Tung Pi-wu-PRESIDENT
55(3 Vice Presidents)
PROCURATOR-GENERAL
*Chang Ting-cheng
tt(2 Dep. Chief Procurators)
STANDING COMMITTEE
NATIONAL PEOPLE'S CONGRESS
*Liu Shao-chi-CHAIRMAN
*112 Vice Chairmen)
STATE COUNCIL
**Chou En-lai-PREMIER
t(10 Vice Premiers)
36 MINISTRIES AND COMMISSIONS
INCLUDING:
Foreign Affairs-Chou En-lai
National Defense-Peng Teh-huai
State Planning-Li Fu-chun
PEOPLE'S REPUBLIC
OF CHINA
*Mao Tse-tung-CHAIRMAN
*Chu Teh-VICE CHAIRMAN
NATIONAL DEFENSE COUNCIL
Mao Tse-tung-CHAIRMAN
**(15 Vice Chairmen)
PROVINCIAL AND LOCAL GOVERNMENT COUNCILS
Elected by People's Congress
**Decided on by People's Congress on chairman's nomination
t Decided on by People's Congress on premier's nomination
tt Decided on by Standing Committee
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
to
Approved For Release 2005/s :/358:E8N-TIDP67-00059A0001000ial of ?41'
FAR FAST
C. KOREA
North-Korea
Political
The political situation in North Korea remains stable. The
Soviet Union continues its dominant role in North Korean political
affairs, although Chinese Communist influence appears to have in-
Greased during the Korean war, Pyongyang readily accepts Peiping's
aid, and the first Chinese Communist Ambassador since 1950 has
recently presented his credentials at Pyongyang. There is no re-
liable evidence of friction over North Korea.
North Korean proposals on unification continue to demonstrate
that the Communists would agree to a settlement only on terms in-
suring their control of all Korea. Continuing to woo South Korea
with the line that the 38th parallel is an *unnatural, man-made
obstacle" which can be eliminated easily, North Korea has offered
to supply the south with electric power, ferrous metals, coal, and
machinery if Seoul would accept a plan for fostering economic inter-
course between the two nations *without delay." Recent propaganda
beamed to South Korea has urged the withdrawal of all foreign forces
from Korea and has stressed the need for the "Koreans themselves" to
neek unification.
Economic
With Sino-Soviet Bloc technical and materiel aid, North Korea
is beginning to show some progress in rehabilitation. The regime,
however, is plagued by labor and material Shortages, and most major
industries remain inoperable. The goals of the current Three-Year Plan
call for a 50 percent increase over 1949 in total industrial produc-
tion, an approximate doubling of 1949 consumer goods output, and
a 20 percent increase in agricultnral production.
The vote for industrial production was reportedly fulfilled
100 percent for the first half of 1954, but it is unlikely that the
1956 goal can be attained. The doubling of consumer goods output,
however, does seem possible.
li9ALEE
Since January 1954 there has been a discernible trend toward
increasingly greater defense responsibilities' for the North Korean Amy.
tdopy NO. .
Approved For Release 2005/04N5MWDP67-00059A0010?061100Zr?
IIIC
Page 2 Approved For ReleaW142WE15 : CIA-RDP67-00059A000100010002-7
of 1.4
Since the ArMiStiC0.9 North Korean strength has increased from 281,000
to 332,000s concurrently, Chinese strength in Korea has been reduced
from 872,000 to 559,000 as of February 1955. The withdrawal of an
additional 73,000 Chinese Ommunist troops from Korea during the
period 19 February-4 Mardi has also been reported.
The North Korean Aix Force, the bulk of which has been moved
from Manchuria to North Korea despite the trace terms, comprises an
estimated 340 aircraft, including 170 jet fighters and 40 jet bombers.
The Communists in Korea retain the capability to attack with
little warning, but their axrrent dispositions and attitude do not
indicate an intention to resume hostilities.
EStimate of Probable Developments*
General Communist policy with respect to Korea will probably bes
(a) to refrain from renewing hostilities in Korea, but to be militarily
prepared for a resumption of hontilitiess CO to refuse to accept any
settlement in Korea which either endangers continued Communist con-
trol of North Korea or precludes hope of eventual Communist control
of all Koreas (c) to rehabilitate North Korea and to strengthen its
military and economic powers and (d) to attempt to weaken the ROK by
infiltration and subversion.
South Korea
Political
President Rhee's primary aim remains the unification of Korea,
which he believes can only be achieved by a renewal of hostilities.
He is motivated by a genuine concern over what he considers to be a
weakened Western military position in Asia, by the continued Communist
threat in Korea, by fears that the US is abandoning South Korea, and
by a belief that American assistance to Japan constitutes a threat
to his country. He also has a deep-seated conviction that "pro-
Japanese" American officialdom is not sympathetic to South Korea.
In keeping with these views, Rhea has criticized American strategic
concepts in Asia including the withdrawal of American troops, has
renewed his agitation for ending UN control and inspection of the
South Korean armed forces, and has demanded a larger military establish-
ment.
* This paragraph is taken from NIE 10-7-54, "Communist Courses of
Action in Asia through 1957,* 23 November 1954.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/W15SPWRDP67-00059A00010044937 of
The ROK has extended considerable encouragement and sympathy
to Nationalist China, but has signed no military pact with it.
.However? should the US become involved in hostilities over the
Taiwan issue, Rhee would probably hope to initiate military action
in Korea or at least precipitate incidents along the demilitarized
zone.
Relations with Japan remain unsatisfactory. Although the
resumption of ROK-Japanese negotiations for the normalization of
relations between the two countries appears likely, little progress
is expected ap long as lhee's bitter and vocal distaste for Japan
prevails.
? Seoul has adamantly resisted North Korean blandishments for
unification talks and cultural and economic intercourse, and has
continued to assert that it is still at war with North Korea. How-
ever, there are indications that the general population in South
Korea is receptive to proposals for liberalized' contacts with the
North and pleased by the prospects of continued peace.
Political instability has increased since the passage of Rhees
constitutional amendments which provides (1) a means whereby Rhee
can run for a third term (2) reorganization of the executive branch
to assure supremacy over the legislature; and (3) a more stable
succession in case of Rheela death or incapacitation. These
amendments were bitterly opposed, and the legality of legislative
approval is disputed by the political opposition. Subsequently,
There have been some defections from Rheegs Liberal Party, which is
wracked by internal dissension. In addition, anti-Rhee leaders
have tried to create a unified opposition party. To counteract these
difficulties Rhee has ordered a rejuvenation of the Liberal Party
and has checked a number of political aspirants for governmental
control,
Rheels health is relatively good considering his advanced age
and recent surgery. However the vary real possibility of his death
or incapacitation for office has kept Korean politics in a state of
constant unrest in anticipation of the expected power struggle. In
any event, the military are certain to play a major part in the
selection of any successor,
Economic
tweagema..o
South Koreals economy continues to be dependent on foreign
aid, amounting to about $3300000,000 in FY 1954. Us aid
Copy No.
TOP SECT= 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III-c Approved For ReleaMP20113111112[15 : CIA-RDP67-00059A000100010002-7
Page 4 of 4
Alak
administrators are constantly harassed 25X1
by ROK demands for:. greater control
over the use of aid funds g impractical industrial expansion; the
exclusion of Japan as a supplier of aid goods; and the retention
of an unrealistic exchange rats.
The economy is characterized by large-scale unemployment,
inflation, and shortages of raw materials, equipment, and
technical skills. So long as budgetary deficits remain and defense
expenditures exceed 65 percent of total outlays, inflation seems
inevitable.
Military
The present 20-division army is now at full strength and holds
more than two-thirds of the front line. The VI Cbrps which was
activated on IS May is now operational, bringing the number of such
units to five. A new ?rear-area =mane is being organized and
reportedly will soon be designated as the 2nd Army. South Korean
ground combat forces now total 384,595g the air force comprises 118
conventional aircraft.
Eta-Ltstin of robablelDeveloente
Future developments in South Korea depend for the most part
on the policies of the US and of President Rhee. As for the latter,
so long as he remains in power it is almost certain that conditions
will remain unfavorable for the development of clear US-ROK under-
standings, for the effective utilization of US economic assistance,
or for a significant improvement in ROK-Japanese relations. It is
unlikely that Rhee will go so far as to launch an attack against
North Korea, but the possibility of Rheegs attempting to involve
the US in renewed hostilities in Korea cannot be dismissed.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET II 1-D
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010W 1 of 4
FAR EAST
D. JAPAN*
General
Since the war, Japan has been unable to develop a sense of
national purpose, and as a result, its leaders and people have
tended to drift aimlessly without agreement on objectives and
without resolution to settle the nation's pressing problems.
Although a majority of the Japanese probably support the principle
of cooPeration with the US and the Free World, their attitudes re-
flect confusion arising from defeat in mar and disruption of na-
tional values, uncertainty over Japan's international role, dis-
trust of foreigners, suspicion of US reliability and motives, and
susceptibility to leftist propaganda. Many important groups in
Japan have neutralist and leftist thought patterns, partly as a
continuing reaction to Japan's undemocratic and militarist past.
Japan has developed only a weak sense of partnership with the
US and of common interest with the democratic nations. Many
Japanese look upon US actions and motives as entirely selfish, with
little regard for the interest of Japan. The View is strong in
Japan that the US considers Japan indispensable to its security, and
therefore Japan can get what it wants from the US.
Political
Moderate conservative forces are dominant in Japan, and have
consistently secured about 2/3's of the Vote in recent national elec-
tions. However, they are split, and efforts to achieve unity over
the past three years have failed. The result has been ineffective
government.
There has been some revival of ultra-rightist views although
they have little representation in the Diet.
This section is largely an extract from "Japan's Situation," an
appendix dated 14 March 1955 to a draft NSC paper entitled "US
Policy Toward Japan," constitutes the Conclusions of NIE 41-54,
"Probable Developments in Japan through 19570? 10 August 1954.
A new NIE on Japan is scheduled for completion in the third
quarter of 1955.
Copy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III-D
Approved For Release ig5g694?1. CIA-RDP67-00059A000100010002-7
Page 2 oi
Left-of-center groups are strong in Japan but, like the con-
servatives, they are split by marked differences over policy and
personality but have cooperated closely in efforts to weaken the
conservatives.
Communists are weak politically in Japan and are unlikely to
attain significant parliamentary strength. The Communists are in-
fluential, however, through their infiltration of the bureaucracy,
the leftist parties, educational institutions, labor unions, and
information media. The Communist Party also retains a large
potehtial for sabotage, last demonstrated in the May Day riot in
1952.
There has been an inevitable reaction of all political groups
against the Occupation reforms and against US guidance. Among the
conservatives this takes the form of a drive for revision of the
Occupation-sponsored constitution to increase the power of the
central government and make for a more highly disciplined populace.
The Socialists oppose these changes and with their control of one-third
of the seats in the Lower House of the Diet, they block constitu-
tional amendment.
Economic
Japan has perhaps the poorest economy of all major powers, with
the fewest natural resources, the most critical import reqUirements,
and the heaviest pressure of population on productive land.
Japanfs basic economic problem is that of providing employment
and adequate living standards for its growing population through
expansion of foreign trade and development of its limited domestic
resources. Japan has had a large international trade deficit through-
out the postwar period which has been offset by roughly $5 billion of
US economic aid and military expenditures. Although considerable
success resulted from the governments deflationary and austerity
policies inaugurated in late 19530 the long-term economic outlook is
adverse.
Pressures in Japan for higher levels of trade with Communist
countries, particularly Communist China, are increasing and the
Hatoyama government can be expected to make a determined effort to
have trade controls relaxed vis-a-vis Communist China probably by
the elimination of the differential between the COCOM and CHINCOM
lists.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/M MIET/P67-00059A00010001 Qtrizg
Page 3 of L.
The government's ability and willingness to hold the line
at this point will, in part, be determined by Japan's ability to
solve its economic problem mitain the Free World. This, in turn,
depends to a large extent on the success of Free World efforts to
raise levels of economic activity in the underdeveloped countries
of Asia and to promote Japanese exports through the relaxation of
tariff and other trade barriers. Even if Japan undertakes sub-
stantial trade with China, its economic tics and dependence on the
free nations will remain comparatively much stronger.
The government's willingness and ability to develop its defense
capabilities will also depend largely on the solution of its economic
problem.
Defense
For a number of reasons Japan is unwilling to move rapidly on
the problems of rearming. It is not convinced that it is in serious
danger of attack or that its national interests are at stake in the
present crisis. It desperately fears involvement in war and is in-
clined to-think that its danger of involvement is less if its forces
are small. It claims it cannot afford to build a large force. It
fears revival of a military clique, and there remains much anti-mar
feeling among women and youth.
. ,
Moreover, the Japanese government, partly at US urging, is
committed to a deflationary program which required the curtailment
of governmental expenditures and the maintenance of a one trillion
yen budget ceiling.
The unwillingness to moire rapidly on defense has made Japan's
defense relations with the US a major issue in Japan's domestic
politics. Most Japanese feel that the US has pushed too hard on
rearmament and expects Japan to put more money into defense than
Japan can afford.
Foreign Affairs
Japan has established diplomatic relations with most of free
Asia, but the spirit of reciprocal interest and cooperation is weak.
Nationalist China almost alone of the free nations of Asia wants to
cooperate with and enlist the support of Japan, while Japan, although
aware of the present value of its trade with Formosa, feels there is
little future to Nationalist China and it must not get more involved.
I 25X1
Copy No.
TOP SECRET 1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III-D Approved For Release fee5egiv CIA-RDP67-00059A000100010002-7
Page 4 of 4
Japan is taking steps to improve relations with the Soviet
Union and Communist China. It desires to eliminate frictions with
these powerful neighbors and to increase trade and cultural con-
tacts with them with a view to establishing full diplomatic rela-
tions. It believes that it can develop good relations with the
Communist nations without harming its close cooperation with the
US and the free nations and that it is in its national interest
to be able to bargain more freely with both sides.
Estimate of Probable Developments
Through 1957, Japan will not be in a position to play a leading
or stabilizing role in Asian affairs. Assuming a continuation of US
assistanoe, however, it is likely that Japan will slowly gain in
strength.
Japan will almost certainly continue to be economically and
militarily dependent on the US. It will therefore continue to
avoid any action that might seriously jeopardize its alignment with
the US, in spite of numerous frictions arising out of its condition
of dependence.
Within these limitations, Japan will attempt to pursue a more in-
dependent foreign policy, notably in terms of establishing more
active and extensive economic and political relations with lommunist
China and the U6SR. There will probably be some growth in neutralist
sentiment, an increasing spirit of nationalism, and a continuing
critical appraisal of US policy.
Moderate conservative elements will probably continue to dominate
Japanese government and politics, although factional rivalry among the
conservative elements will probably hamper governmental effectiveness.
Although factionalism will limit socialist influence, the two groups
will probably retain sufficient strength to act as a break on the
governmentls increased conservatism.
Although the Japanese Communist Party is not likely to gain
substantial parliamentary strength, it will continue to exercise an
imnortant influence through its ability to aggravate popular griev-
ances and to exploit and infiltrate mass organizations of the non-
Communist left. The Communists will probably be able to maintain
their underground organization but not to increase significantly
their potentialities for sabotage and subversion.
Assuming US military assistance, the Japanese Government will
continue to rearm gradually. By 1957, it is probable that Japan
will have military forces capable of making a substantial contribution
to its defense, but by no means adequate to assume full responsibility
therefor. Japan will be reluctant to accept military commitments
beyond the immediate defense of Japanese territory and will hesitate
to join any regional defense system.
1 April 1955
Approved For ReleaseR)57NAT: CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/157%IMA7-00059A000100010 kel of 5
FAR EAST
E. 'Taiwan*
Political
The National Government of the Republic of China is an anomaly.
It exists only because of US support. The National Government continues
to be acknowledged by a majority of the states of the world as the legal
government of China, yet it controls only a few islands, and its inter-
national position is being eroded by the growing power of Communist China.
Nationalist China is an armed camp, maintaning a disproportionately
large military establishment and focusing its resources and its purpose
on a future invasion of the continent. Yet its economy is incapable of
supporting this military establishment, and its armed fomes are not capable
by themselves of undertaking the desired invasion or even successfully
defending the territories they now hold. There is no immediate prospect
that its hope for an early return to the mainland will materialize;
meanwhile its armed forces grow older. The regime has enjoyed US support
and on 2 December 1954 signed a Mutual Defense Treaty with the US. How-
ever, the US has not to date underwritten Nationalist aspirations to
return to the mainland, and in recent public utterances has indicated
ap unwillingness to do so. It is staunchly anti-Communist, yet it is
an important source of dissension in the non-Communist world.
The National Government is superimposed upon a native Taiwanese
population from which its interests often diverge and which outnumbers
the mainlanders 8 million to 2 million. The National Government claims
to speak for the Chinese people everywhere, yet its leadership and
political programs have not attracted significant support from among
mainland or overseas Chinese, and the Taiwanese, themselves of Chinese
descent, have no effective voice in the determination of national policies.
Nationalist China is in essence a one-party state; authority is
centralized in the hands of a few, and ultimate political power resides
in the hands of the leader of the Kuomintang Party and head of the govern-
ment, Chiang Kai-shek. The Generalissimo dominates the political scene
not so much through direct fiat as through indirection and the skillful
balancing of personalities and cliques within the government. His
traditional and skillful practice of divide-and-rule is probably responsible
in large measure for Taiwan's present degree of political stability.
At the same time Chiang's methods are largely responsible for such con-
tinuing Nationalist shortcomings as the retention of incompetents in
high positions, a general failure to delegate authority to subordinate
political and military officials, and factionalism within the ruling circles.
* This section is Largely a sumnary of NIE 43-54, "Probable. Developments
in Taiwan Through Mid-1956," 14 September-1954.
uopy NO.
Approved For Release 2005/08/1fIRCWW67-00059A00010900 v2-11955
25X1
25X1
111-E Approved For Release 261f5/WHFCIA-RDP67-00059A000100010002-7
Pagd 2 of 5
The struggle among traditional mainland factions for political
influence has persisted, but political rivalry centers at present chiefly
around Vice President Chen Chteng and the Generalissimo's Moscow-educated
elder son, Chiang Ching-kuo. The power of these two figures is believed
to be approximately equal at the present time.
Antipathy is not strong at present between the native Taiwanese
and the Chinese mainlanders on Taiwan. In short, the native islanders
tolerate the National Government, and wish it every success in its efforts
to return to the mainland.
On the surface the general state of Cainese Nationalist morale
remains fairly good; despite recent events, it is not appreciably different
from what it has been for some time. Communist subversive activity on
the island is not of major proportions, and apparently is being effectively
suppressed. Nevertheless, the Nationalist regime has undergone many
frustrations and disappointments during its six years on Taiwan, and
adverse psychological forces are almost certainly at work beneath the
surface of Nationalist society.
Economic
Owing to wartime and postwar dislocations, Taiwan no longer has a
viable economy. Since 1945, economic development of the island has been
largely neglected because of the National Government's preoccupation with
political and military affairs.
Taiwan's economy is basically agrarian, with nearly 60 percent of the
population engaged in agriculture, while only about 5 percent are engaged
in industry. The prospects for agricultural expansion are limited.
Undeveloped resources outside of agriculture are also limited. Known
mineral resources are meager, although coal production meets the island's
current needs and could be expanded to support a growth in industry.
Formosa could also greatly expand its hydroelectric facilities. The
development of any of these resources, however, would regaire heavy
initial investments.
The National Government hasnotaeriously attacked its long-term
economic problems, partly because of its preoccupation with immediate
problems and partly because of its unwillingness to accept the prospect
of a long exile on Taiwan. Government enterprises, which account for
two-thirds of all activity in industry, mining, and transport operate
inefficiently, and, in many instances, at a loss. Domestic private
investors have received no real mcouragement, while foreign private
investment has been limited by legal provisions. Other Nationalist
policies have tended to decrease production, discourage investment
in agriculture, reduce farrimarketing, and hamper exports.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/157%1MNER7-00059A0001000100CrYi-E
age 3 of 5
In spite of these shortcomings, the economic situation, with US
assistance,* has substantially improved, as compared with the chaos of
1949. Between 1949 and 1953 industrial output increased from 74 percent
to 140 percent of the 1941 level, while agricultural output rose from
less than 80 percent to 93 percent of the 1935-1939 level. Effective
budgetary controls have halted the growth in government expenditures,
although government receipts exclusive of US aid did not rise in real
terms between 1950 and 1953. Also inflationary pressures have been eased.
However, a balance of trade deficit persists; in 1953 it amounted to
$69 million.
Military
The present strength of the ground forces is 422,000, of Which about
285,000 are effective combat troops organized into 24 infantry and 2
armored divisions.
The army's effectiveness is impaired by a failure of the highest
command echelons to delegate authority and by a political officer system
which interferes with command functions. However, a recent reorganization
integrated logistical support into the field army structure. This move
promises more effective control of supply and resupply and consequently
should better provide effective support to fighting units. Progress
is also being achieved in raising the level of combat efficiency of the
Nationalist Army. Leadership at the lower levels is improving steadily.
Training has also improved. Troop morale is considered satisfactory.
Based on status of personnel, equipment, training, and quality of leader-
ship, MAG rates infantry units at approximately 50 percent combat effective.
The navy includes two destroyers, five destroyer escorts, and a
number of smaller craft.
The air force, with 410 combat aircraft (including 117 jet fighters)
is probably superior to the other services in equipment, morale, and
leadership. However, it is far weaker than the Chinese Communist Air
Force.
Deliveries of US aid goods in 1953, exclusive of military supplies,
totalled US $83 million, amounting to 38 percent of Taiwan's receipts
of goods and services fran abroad, and, if converted at the average
black market foreign exchange rate, equalling 62 percent of the net
revenues of all levels of government. US economic aid funds, exclusive
of Mall costs disbursed on behalf of the National Government between
July 1950 and August 1954, totalled approximately US $300 million.
TOP SECRET
uopy A0a
1 April 1955
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
III-E Approved For Release 20R?TOMPArft-RDP67-00059A000100010002-7
Page 14 of 5
Estimate of Probable Develo ments
The future fortunes of the National Government will be determined
to a very large extent by US policy, and will depend increasingly upon
the scale and character of US aid and support.
Should US aid continue at approximately present levels, the prospects
of the National Government for maintaining domestic stability between
now and mid-1956 cpear good. Communist influence and subversion will
probably continue to be vigorously suppressed, although sporadic cases
of Communist infiltration and of defections may occur, particularly as
time passes and there is growing disillusionment over prospects of a
return to the mainland. Nationalist leadership will irobably not succeed
in creating any new and dynamic political program.
Although there will be some improvements, the fundamental economic
weaknesses of Taiwan will probably became more acute by mid-1956. Because
of a rising population and a leveling off of current expansion of industrial
and agrieultural production, Nationalist China by mid-1956 will probably
be more dependent than at present upon US economic aid for its continued
existence.
A return to the mainland will continue to be the centra objective
of the National Government and the focus of its fbreign and domestic
policies. The National Government will continue to believe that US
support for such a return will not be likely unless and until other
circumstances impel the US to engage Corrnunist China or the Communist
bloc in a major war. Nationalist leadership will almost certainly not
become reconciled to an insular future, nor will it concentrate principally
on the development of Taiwan. In this connection the islands of Quemoy
and Matsu have recently assumed such importance in the eyes of the Nationalists
that their loss would be a severe blow to morale, irrespective of the
circumstances or conditions under which the loss occurred. In any event,
however, we believe that the blow would not be so great as to cause the
Nationalists immediately to fold up. We believe that they would continue
their resistance to Communist pressures, at least for a time. The sub-
sequent behavior of the Nationalists would depend in large measure on
specific US actions with respect to Taiwan, and on US reactions to
subsequent Communist moves,
The Cninese Nationalist armed forces remain an important source
of non-Communist military strength in the Far East. During the next two
years their combat capabilities will appreciably improve. However, they
will remain greatly outweighed by those of Soviet-aided Communist China.
Outside logistic, air, and naval support will continue to be required
to defend Taiwan or the Pescadores against full-scale Communist invasion.
1 April 1955 TOP SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
Approved For Release 2005/08/15 :EFAWE-00059A00010001041E5 f
Nationalist China's international position will continue greadually
to deteriorate. A few foreign states will probably recognize the Chinese
Communist regime during the next two years, and Nationalist China's right
to membership in international bodies, including the UN, will come under
increasingly serious challenge. In the face of a deteriorating inter-
national position and unimproved prospects for return to the mainland,
the National Government's task of maintaining its own morale and that
of its armed forces and the former mainlanders on Taiwan will become
increasingly difficult.
Twelve million overseas Chinese are one of the few sources from
which the Chinese Nationalists might draw additional support. However,
little significantly increased support from among the overseas Chinese
will be forthcoming, largely because of the probable relative power
of Communist Cnina and Nationalist China.
If, beyond the next two years, the adverse trends described above
are not reversed, the strength and international position of the
Republic of China will probably deteriorate, even assuming a continuation
of US support at approximately present levels.
Copy No.
TOT SECRET 1 April l9.5
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
A TOP SECRET III-F-2
Page 1 of 6
FAR EAST
Mainland Southeast Asia INDOCHINA*
VIETNAM
Political
The recent success of Premier Diem in military operations against
the Binh Xuyen, and in his stand against Bap Dai and the French, has
created a new and potentially revolutionary situation in South Vietnam.
While the situation remains extremely fluid, Diem appears to hold the
initiative, and the interested parties -- particularly the French and
Bao Dai -- will have to adapt themselves to a radically new situation
dominated by Diem or by more extreme nationalist elements. If they do
not adapt and if there are any substantial efforts by Bao Dai or the
French to frustrate Diem's government, the chances of anti-French violence
and the dissolution of the imperial institution would be greatly increased.
Prior to the recent clashes between Diem's forces and the Binh
Xuyen, little progress towards establishing a strong, effective anti-
Communist government had been made in South Vietnam since the conclusion
of the armistice. Despite his considerable nationalist following, Diem
had been unable to attract much support from the small political elite
of the country, primarily because of his inability or unwillingness to
delegate authority. Diem placed his trust in members of his family and
resisted suggestions that he broaden his government's popular base.
Diem, as the leading lay Catholic in Vietnam, has the support of most
Catholics, but this fact has generated suspicion among non-Catholic
Vietnamese and religious sect leaders who have accused Diem of promoting
a private Catholic army. However, none of the groups opposing Diem
has apy broad-based popular support. Diem's popular reputation for
integrity and his nationalist zeal have been his most important assets,
and the virtual expulsion of the Binh Xuyen from Saigon-Cholon has
increased Diem's prestige throughout Vietnam. The confidence of Diem
and his supporters in their own strength, judgment, and popular appeal
has been considerably enhanced.
* This section is basea 17117gely on NIE 63.1-2-55, "Possible Develop-
ments in South Vietnam," 26 April 1955, and SNIE 63.1-2/1-55, "The
Current Saigon Crisis,n 2 May 1955. This report will be revised
following the publication of NIE 63.1/63.2/63.3-55, "Probable
Developments in North Vietnam, Carecodia, and Laos through July 1956,"
scheduled for publication in June.
Approved For Release 2005/08/1513.,41gLiktilg7-00059A0001000
10002-7
(dopy No. IO
1 May 1955
25X1
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
I31-F-2 TOP SECRET
Page 2 of 6
In contrast to the fluid situation in South Vietnam, the Vietminh
is energetically consolidating its control over North Vietnam, is
greatly increasing its armed strength by various measures including the
evasion of armistice terms, and is continuing, though not without difficulty,
to develop networks of agents and political cadres in South Vietnam, Laos,
and Cambodia. The harshness of Vietminh repressive measures and the
present economic difficulties of the regime, coupled with the flight of
refugees to the South, would seem to presage an unfavorable popular reaction
to the regime.
Military
The Vietnamese National Army is now being reduced from its former
strength of 170,000 regulars and 10,000 auxiliaries in conformity with
US recommendations for a 100,000 man force. The French Expeditionary
Corps has a strength of approximately 150,000 regulars and 22,000 aux-
iliaries, plus relatively small air and naval contingents. The French
are reluctant to commit their forces in internal security operations.
At the present time, the combined French and Vietnamese armed forces
could only delay a full-scale Vietminh invasions they could not stop
it without reinforcements from outside.
The Viet Minh is consolidating and reorganizing its armed forces
by grouping formerly independent regular and regional units to form new
divisions with augmented firepower. During the next 12 months the Viet-
minh will probably have at least 11 or 12 infantry divisions, two artillery
divisions, and one anti-aircraft division. These developments would more
than double the pre-Geneva combat effectiveness and capabilities of the
Viet Minh regular army. The Viet Minh is expanding and improving its
transportation and communication facilities, including rail and highway
links with South China.
Estimate of Probable Developments
As a result of his recent successes, Premier Diem will almost certainly
resist any efforts to remove him from office. His actions and those of his
followers have taken an increasingly nationalistic, anti-French tone and
Diem may now be convinced that a continuation of this anti-French policy
is essential to the rallying of popular support. Nevertheless, he has
exercised a moderating influence on the more radical elements around him.
If Diem is thwarted in his objectives by the French or by Bao Dai, however,
he will become more susceptible to pressures toward extreme action. Diem
has rallied additional support during the currant military phase, and
1 May 1955 Approved For Release 2005/08/1VICIMM7-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP STORET III-F-2
Page 3 of 6
from this position of strength, Mem will almost certainly continue to
gain adherents, including defections from among the Binh Xuyen and the
sects.
Aside from the French Army, only the VNA presently has the capability
to enforce Bao Dai's authority in Saigon or to back Diem in defiance of
Bao Dai. There are some VNA officers who dislike Diem and who are con-
cerned by the developing rift between Diem and Bao Dai. On the other
hand, there is considerable pro-Diem nationalist sentiment in the Army;
Diem has gained additional support as a result of clearing the Binh
Xuyen from Saigon; and most importantly, the VNA units in the Saigon
area appear to be loyal to Diem. As a result of Diem's stand against
Bao Dai and because of the latter's involvement in what many Vietnamese
nationalists consider to be a French inspired political maneuver, Bao
Dal's prestige has been greatly reduced. There appears to be considerable
sentiment for the deposal of Bac Dad., and if Diem gives his consent such
action may be taken at any time. For the present, Bao Dai apparently
feels that the tide is running with Diem, and is attempting to preserve
the institution of the monarchy by accepting the continuation of the Diem
government. The French will find it difficult to accept Diem's success
which came despite their strong and well-publicized opposition, and will
probably continue pressure for his removal. However, if the French believe
that Diem will succeed in consolidating his position they may decide that
they have no choice except to repair their position with Diem as best they
can while making plans for accelerated withdrawal of their forces.*
The Viet Minh probably fear that Diem's continuation in office would
limit the prospects of a peaceful unification of Vietnam under terms favorable
to the Cbmmunists. They will probably continue covert efforts in South
Vietnam to keep the situation agitated. The COmmunists almost certainly
will not invade South Vietnam in the near future.
Assuming that the US continues to support Diem, and that the French
acquiesce, we believe the situation will stabilize in Saigon under Diem's
control. However, Diem's talents as an administrator are unlikely to improve.
His success achieved largely on his own initiative and with his own resources
is likely to make him more independent and less amenable to policy guidance.
Diem's government will still be confronted with manifold internal problems e
e.g., integration of the sects, resettlement of refugees, land reform, ex-
tension of government authority in the provinces, training of the army.
Although Diem has improved his position, we believe that it will still be
extremely difficult, at best, for Diem or any Vietnamese government to build
sufficient strength to meet the long-range challenge of the Communists.
The Special Assistant, Intelligence, Department of State, believes that
? the last sentence of this paragraph understates the difficulty the French
would have in accommodating to a strong, anti-French government in South
Vietnam, and therefore believes the sentence should read: "If these
efforts are unsuccessful and Diem appeared to be consolidating his position,
the French in the end may decide that they have no choice except to step
up the withdrawal of their forces from Vietnam."
Approved For Release 2005/08/15 : CIA-1Wp6gEW/9A00010001-Uuui-I
eopy No. IQ
1 May 1955
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III-F-2 TOP SECRET
Page Lof 6
TA OS
Present Situation
Laos lacks effective political leadership, and the population is in
large measure politically apathetic. At present the government is a
reasonably stable coalition of leading non-Communist political personalities
with the pro-US Crown Prince Savang maintaining a balance of power.
Laos is principally threatened at present by the Communist-dominated
Pathet Lao movement which occupies and controls the two northern provinces
of Phong Saly and Sam Neua and has an army which numbers about 6,000 men.
Negotiations designed to bring the Pathet Lao into the Royal Government
have resulted in a cease-fire in Sam Neua and Phong Saly provinces and
the establishment of a mixed committee to renew further discussions. This
cease-fire, which tends to solidify the Pathet Lao position in the two
provinces, was brought about largely by Premier Katay who tends to regard
the Pathet as "wayward brothers who can be brought back into the fold,"
rather than as Communists supported and controlled by the Vietminh.
The Laotian armed forces have a current strength of 27,000 and are
augmented by a French Military Mission and by 3,500 French combat troops.
The Laotian Army has not displayed a real will to fight and is incapable
of defending Laos against any Vietminh invasion. It is unlikely that
the Laotian Army can now without all-out French support exercise effective
control in the two northern provinces in which the Pathet Lao are concentrated,
or that it can prevent Communist activities on the local level elsewhere
in Laos.
Estimate of Probable Developments
Pathet Lao followers of the Vietminh will probably continue to
exercise considerable control in the provinces of Phong Saly and Sam Neua.
Moreover, the Communists will have the capability by political and sub-
versive means to heighten their influence in Laos and to weaken the
anti-communist government. However, the nature of Communist aggressive
action against Laos will be moderated by the Communist desire to continue
their "peaceful coexistence" line in Asia, particularly directed toward
Indian reactions, and to a lesser degree by the possibility of US counter-
action. Under these conditions, and providing that the Lao Government
obtains and effectively utilizes outside assistance, we believe that
it can limit Communist political advances.
1 May 1955 Approved For Release 2005/08/15tOZIMM7-00059A000100010002-7
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
TOP SECRET III-F-2
Page 5 of 6
However, if during the period of this estimate, South Vietnam should
fall to the Vietminh, Communist capabilities for pressure against Laos
would be substantially increased, and Laotian will and capability to
resist these pressures mould be correspondingly lessened. The extent
to which the Communists choose to exploit this situation would depend
almost entirely on their estimate of the probable reactions of the Manila
Pact power and of the neutral countries of South and Southeast Asia.
CAMBODIA
Present Situation
King Norodom, who had exercised supreme power since 1952 when
the National Assembly ceased to function, officially abdicated on 2
March 1955 following criticism by the International Control Commission
and some of the Geneva signatories of his anti-democracy program designed
to preserve the monarchy as the primary instrument of government in Cambodia.
Norodom's mother and father have assumed the throne, with the former exercising
actual authority. Norodom continues to exercise many of his old functions
in the government and has publicly announced his intention to take his
program to the people and form a party in opposition to the national or
"Democratic Party."
The Cambodian public, despite their affection for the ex-King, have
remained largely apathetic to the abdication probably because the significance
of the ex-King's motional maneuver escapes the unsophisticated bulk of
the population. However, Cambodians as a whole can be expected to remain
loyal to the royal family, and Cambodia's stability will continue to
depend primarily on the attitudes and reactions of the royal family as
a whole, rather than in changing popular political tastes.
We believe that despite the evacuation of a number of Viet Minh
troops a sizeable Viet Minh cadre remains in Cambodia. Moreover, the
Cambodian Communist armed bands, although ending their guerrilla activities,
have failed to demobilize or to turn over their arms.
The Cambodian armed forces total 32,000 and would be incapable of
defending against a large scale Viet Minh invasion.
10P SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A0001000
May 19
25X1
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
III-F-2 TOP SECRET
Page 6 of 6
Estimate of Probable Developments
We believe that for the next year or so, providing outside assistance
and the assurance of western support are forthcoming, the Cambodians will
maintain an anti-Communist policy and will be able to control int ernal
subversion.
Future events in Cambodia will be co is iderably affected by developments
in Vietnam and in Laos. A Oomrminist takeover in South Vietnam would increase
Communist capabilities against Cambodia and would impair Cambodian will to
resist further Communist pressures, though we estimate that the Cambodians
would be more resolute than would the Laotians under similar circumstances.
1 May 1955
Approved For Release 2005/0035 '67?ifilDP67-00059A000100010002-7
SECRET
Approved For Release 2005/08/15 : CIA-RDP67-00059A000100010002-7
100 105 110
?th
...1
73
1
I
i
-1
t.
H
. Al, ... .
..
? Ssu-nieo
i ".t../....../
.
s?ao Kay
SO Ph. u
`\,.. Lal Cha 0 - ....

...
- N
anh Th_i fie) ."?...---\....7,..??
an.ning , 7
t.. CB? IL'000
` I
BacA Kan9 N
/ Ne Ch? ing-ming
. Tuyen fi LAng S A

----"--- 0 Keng 'I'ung
B
By ?
' Dien Bi;in,Plin ?S? L
re1
.
"
'..,,v. ? u Tho .1, A, * C Pei-hai
illiki, ,--
V. Bayard
Ni
20
B U RVj
Is???-f.
...,...)
1--mi,ang
,'
A Al ,
?soc, Si te?:?
) \ sKit " ? '''''",r, ',, 1--1.
's
-
Ban Houe lAal \\\ ' ?
a s a
')
( ri,:_,---,i ltri ---' ,
AN
nh .,
Phu Ai. 4W, CAC SA 18 may 1955
.44 ? Xs.s . AM h - H (300 Days)
'
h Shin
2 Ch'iung shan..
2
Chiang Ra' .? --'- -,--

...?
uang Prabang
E Moony Soul A _ uo,
? . ,...?
,THA LI?ND-"- S VZin? l'
Thenh Hoa ?
.??,
i? 0') s ic i N c.
HAINAN
Chiengmal
ang --- rti V..ns V,ssg: .e %., Phu Dien Chau
-h Nan- - j-
,0 Mu 1-NH
'1
Muang ?
L0,00.0g
, - %Ha
4/4 Lek Sao TInh
,.. Mang Ph ae Vi -,,
6.4
(--
?
aracht . Muang Lord
Llagn Tha,ni .ong Hol
----?"--,
? NakhMo_n_Pngan,om.A
? T a k
An
INDOCHINA
.1
(' '
\.
,6"111111111k,>-
Tchepon DEMARCATION LINE
(PROVISIONAL)
Mgang KhOrt Kaen Mulideh fn'eeknh: ' usng Tri
,
? - Muong hi '' HUE
iiii
\,.. ha Sarekham
'Chi
.
?OURA
i o
p ? Sa a e
THAIL ? INT
Completion of
Troop Withdrawals
"/?,..\,,,n, th, ?
15
?
Vietnam
18 May '55 (300 Days)
.? Laos
\ 20 Nov. '54 (120 Days)
Cambodia
'54
.Surin
,,,0.0"... ???...... ,
..----A 1 ISernrong
,
1-- )
?t
1.)
0
??
Ped igo e . ORS NO ?
( ? _ _ _
1 Attopeo
ENt

? ?
17 ,APPI u A ,
4'6' -,/,,? -,..,,, 'or Nhon I
15
20 Oct. (90 Days)
.p,,,t . isophon
?ii.,(1!so..,
Ch.,
's '11 '
Viet Minh
i'-'-'
,0Slern Reap
/ . Battam n C.'",A M
?\/- Puree ,
,/ i x----v?--
"oe
OD1A
' Kratle
r,4 dog COO
,,, ?
.. 18 May 1955
000 Days)
4'
.% P Ban Me . 1 .
,,... Thuot N?sh 6.
s. KI,..t."..7. kel/ '....."\-- ,__, ? ? L'ili:At\Nha Trang 1--
Evacuation Area
French Evacuation
Area
French Division Plq.
p Point of Entry
----,(y) f Chhna
\I \
PHNOM PENH ii
t . Umbel/
L si Takeo
Tan 0
o.
ompong Cham 1 ,,j,. Debt . (
--''''' --fr-Loc N' h '(