FAR EAST/PACIFIC DIVISION OFFICE OF REPORTS AND ESTIMATES CENTRAL INTELLIGENCE AGENCY WORKING PAPER WEEKLY INTELLIGENCE HIGHLIGHTS NO. 90

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01090A000500040013-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 19, 2016
• Document Release Date: July 7, 2005
• Sequence Number: 13
• Publication Date: March 7, 1950
• Content Type: PERRPT

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COI'Y a O.~
FAR EAST/PACIFIC DIVISION
OFFICE. OF REPORTS AND ESTIMATES
CENTRAL INTELLIGENCE AGENCY
WORKING PAPER
WEEKLY INTELLIGENCE HIGHLIGHTS
N?. 90
DATE: 7 March 1950
DOCUMENT NO.
L1 DECr,F;`SiFiEf3
CLASS. CHANGED TO: 7
?,irvrn
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NOTICE: This document is a working paper, not an official CIA
document. It has been coordinated within ORE, but
not with the IAC Agencies. It represents current
thinking by specialists in CIA, and is designed for
use by others engaged in similar or overlapping studies.
The opinions expressed herein may be revised before
final and official publication. It is intended solely
for the information of the addressee and not for further
dissemination.
.1ECRE T
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SEC R E T
OFFICE OF REPORTS AND ESTIMATES, CIA
FAR EAST/PACIFIC DIVISION
INTELLIGENCE HIGHLIGHTS NO. 90
1 MARCH to 7 MARCH 1950
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SUCTION I. SUMMARY" OF FAR EAST TRENDS AND DEVELOPNI ITS
Although the general strike proposed by Japan's labor Moderates
is scheduled to start this week, the scale of action to be taken Is
expected to be less than militant (p. 2).
The UN Commission on Korea has decided to institute a systems of
UN military observers, an action which should diminish the likelihood
of major incidents along the 38th Parallel (p. 2).
Although a considerable degree
of local dissat a action with the recently-concluded Sir~x-Soviet
treaty, it is unlikely that the reaction will threaten USSR ties at
present (p< 3).
Rao Dai's desires to have any possible US aid channeled directly
to the Vietnam Government appeal' to be in contradiction to the express
views of French military authorities on the scene (p. 4)~
The long-awaited Malayan People's Anti-Bandit Month, launched
last week, indicates British awareness of the increasing threat posed
by the possibility of Overseas Chinese support for the terrorists
(p. 4)
Indonesia's major state, the Jogjakarta "Republic", is attempting
to extend its sway over many of the former "Federalist" states, in
apposition to the views of some moderates in the central. USI admin-
tration (p, 5).
The Burmese AraW has scored notable and unexpected initial s uo-
ceases in its campaign against the Karen insurgents (p. 6)
Nationalist Chinese air raids strike South China.Xuban Chinese
vow support for Peiping... Thai rice surplus spoken for,
The .marginal notations used in succeeding sections of this Weekly
("A", "B", or "C") indicate the importance of the items In D/F'E
opinion, with "A" representing the most important.
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S E C R E T
SECTION II. DEVELOPMENTS IN SPECIFIED AREAS
JAPAN
Uoderate unions to initiate "moderate" strikes----Although the twice-
postponed Japanese general strike is scheduled to commence thin
week, the active measures contemplated by moderate trade unionists
will remain within the scope of "legal" dispute tactics. In order
to duck the ban on government workers' strikes, leaders of the
railway union have directed their members, instead, to adhere
"strictly" to the working regulations embodied in the Labor Stan-
dards Law, an action which should result in a considerable disrup-
tion of train service. In an attempt to exploit the advantage of
coordinated strike action? workers in private industries, who are
not bound by the same prohibitions as government employees have
planned strikes of their own. Such groups as the coal miners and
electrical workers, who have directed the initiation of "wave tac--
tics" on 8 and 9 March, can take more militant and probably more
effective action than the railroad workers. While the coal and
electric unions have indicated their intention of adopting even
stronger tactics after 13 March, neither private group apparently
plans action of the sort that would make them liable to penalties
under SCAP'a regulations prohibiting general strikes.
KOREA
UNCOK calls for military observers--On 2 March 1950 the United
Nations Commission on Korea (UNCOK) adopted a resolution requesting
the UN to supply eight military observers for service in Korea, in
order to report on developments that might lead to military con-
flict in Korea. The UNCOK resolution stated that the military
observers should come, insofar as possible, from the nations now
represented on UNCOK.
Although the presence of UN military observers will not inhibit
continued northern Korean support and incitement of guerrilla acti-
vities within the southern Republic, the observers should act as
a deterrent to openly aggressive moves by northern Korean regular
armed forces along the 38th Parallel and should also assist in re-
straining any aggressive moves by southern forces against the
north. As a further evidence of UN interest in Korea's future, the
presence of military observers will also tend to bolster the south-
ern Republic's confidence in its ability to withstand Communist pre-
sures..
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SECRET
CHINA
Popular resPans+, to Sinn-Soviet treaty---..Although it is impossible "B"
to take seriously the Communist contention that the Chinese people
are wild with delight over the new Sino--Soviet treaty, it still
appears that the treaty has gained the USSR? at small expense, a
three-year period of grace in which to strengthen its position in
China.
~ 5X 1 a general lack of Chinese enthu??-
s aam for the treaty, a Chinese realisation that only the surface
of the treaty is visible, and a suspicion that the Chinese Commu-
nists m have made "fantastic concessions" in secret agreements,
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h se previously ignorant of the extent of Soviet privileges in
Manchuria, while to others it confirmed the continued Soviet enjoy-
ment of those privileges, The Soviet promise to return the Chang-
chun railway and the Port Arthur naval base area to Chinese control
prior to 1953 is suspected by the Chinese of ' concealing a Soviet
belief that this retrocession will prove to be unnecessary, Cer-
tain Chinese circles regard as ominous the presence of a Sinkiang
delegation in Moscow and the absence of mention of Sinkiang in the
treaty. Rumors persist that the USSR is pro-empting foodstuffs in the face of a famine in China, There is apparently
a belief, among the Chinese intelligentsia, that the treaty has
over-extended China in its military alliance with the Soviet bloc,
and has bound China closer to the USSR than Chinese Communist
leaders themselves had desired. Finally there is some
resent-
ment that the announcement ' of the treaty was timed to dominate the
Chinese New Year celebrations
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y
ar
con-
cerned with "baleful rumors" and with speculation
WWAS on secret agree-
ments, and thus has not been firmly based on a serious examination
of the Soviet position in China. In addition, Communist manipula-
tion of all organs of public opinion is likely to drown out the Iso-
lated voice of protest. Although politically sophisticated Chinese
will continue bitterly to resent their country's subservience to
the USSR, it does not appear likely that their disaffection will,
prove sufficiently contagious and virulent to threaten the Sino-.
Soviet alliance for at least the next two or three years.
Public conversation about the treat
ham b l
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S E C R E T
INDOCHINA
who will receive US aid?---Plans for US military aid in support of
French operations in Vietnam have stimulated controversy as to who
the recipients shall be. The Bao Dai Government has repeatedly
emphaa ized the psychological importance of a direct transfer of
US aid to Vietnamese authorities, although it is incapable of
making effective use of significant amounts of military equipment
through its own limited establishment. On the other hand, General
Carpentier, Commander of French Union forces in Indochina has flatly
stated that a large proportion of any arms transferred to ostensibly
pro French Vietnamese would be passed on to the Resistance. More-
over, he has threatened to resign his post if US arms dispatched
to Indochina are not delivered to the French.
Attempts to resolve this quandary have been made on the basis
of a section of the 8 March Bao Dai-Auriol Agreement which provides
that "orders for military equipment shall be made by the Vietnam
Government to the French Government," and that "in time of war" ulti-
mate authority will rest with a French general officer. However,
in view of France's constant efforts to represent its military actif-
vities in Indochina as merely "pacification" the authorities of
the Bao Dai Government may well question the applicability of the
8 March Agreement in this matter. The only apparent solution to
this impaslae seems to be some face-saving arrangement by which
Hai Dai would ostensibly receive the prospective aid while the
French actually assume effective control over its distribution and
employment
MALAYA
Conflict in Mal a intensified-The launching of the Malayan People's "B"
Anti-Bandit Month on 26 February indicates that the British have a
new appreciation of the gravity of the Communist guerrilla effort
in Malaya and a recognition of its long-term natuxe. Although the
campaign has mobilized wide popular support (350,000 volunteers
have been recruited), auspicious results are not expected. Serious
bandit attacks have been increasing in re ;ont months and some ob-
servers are of the opinion that at best the campaign will serve
merely to counter the ill-effects of British recognition of Commu-
nist China -a move which raised bandit morale
It now appears that the link between the terrorists and the
Chinese, community in Malaya may become stronger. The possibility of
a wholesale shift of alien Chinese sympathy in Malaya toward the
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S E C R E T
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Communist regime in China is evidenced by the welcome accorded the
prsaninent Chinese, TAN Kah Kee, upon his recent return from Comsou-
niat China, and the lose of Western prestige within certain quarters
following the failure of the US Consul General to repossess a de-
fected Chinese ship under mortgage to the US. Furthermore, the
Peiping radio has intensified its propaganda campaign glorifying
the rebellion in Malaya, and it is expected that TAN Kah Kee and
other influencial Chinese will increase their efforts to develop
support for the Chinese Communists among local Chinese.
Republic challenj es federal authoriiyr The Republic of Indonesia
at Jogjakarta, the principal state forming the federal government
of the United States of Indonesia (USI), is currently attempting
to gain control of many other member states of the USI. The USI
Minister of the Interior, an East Indonesian, is demanding that
the areas in question.retain their identity or submit to USI
control until self-determination by regular. elections is possible.
High Republican officials have severely criticized the USA policy
of appointing temporary federal commissioners who have delayed the
transfer of already-dissolved territories to Republican administra-
tion. Republican insistence on the imposition of its wthority in
areas of Java, regardless of the presence of USI Commissioners,
results in dual administrations which preclude orderly government.
The Republic, led by a radical group which succeeded the moder-
ate officials absorbed by the USI, appears to be winning the contest
for power. The Republican Ministry of Information is competing with
the USI Ministry of - Information and has successfully urged many
state leaders to agitate for incorporation with the Republic. A
minor crisis has also developed in the USI Ministry of Interior,
where several Republican members have resigned in protest to govern-
ment policy. Republican pressure in the. USI House of Representatives
has forced the adoption of a motion recommending that virtually all,
of the territory which was under Republican domination at the time
of the Liuggadjati Agreement of March 1947 be returned to the .Re-
public. This territory includes all of Java, Sumatra and Madura.
Republican maneuvering, if unchecked, mould result in the dis-
solution of the USI federal structure as it now exists. This struc-
ture would bo replaced by a unitary state, actually the Republic of
Indonesia. In turn, resistance to Republican efforts to eradicate
strongly federalist states in East Sumatra and East Indonesia could
cause civil strife which would further undermine stability in Is:Zdo-
neeia.
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S EC R E T
BURMA
Major AM Z gains against Karens--After a week of sharp fighting
against the main Karen forces, the Burmese Army on 25 February
captured Nyaunglebin, the second most important Karen stronghold
in Burma. Government troops have since moved rapidly northward
against extrercely light opposition and are now reported to be
within 40 miles of Toungoo, the Karen "capital'+ and chief center
of resistance. The advance has apparently resulted from a criti.-
eal Karen ammunition shortage, as well as from a surprisingly well-
planned and executed Burmese attack.,
Although the Karen main body has not been destroyed, the
Burmese Army, apparently flushed by its initial successes, has not
hesitated to advance without consolidating its gains. Therefore,
it. Is possible that the Burmese Army is In danger of ambush. On
the other hand, the early capture of Toungoo, which appears entire-
ly possible, would constitute a notable military victory for the
Burmese Government, since unified and highly organized Karen re-
sistance would be ended, although prolonged guerrilla warfare
would continue. Such a Burmese victory, moreover, would consider-
ably enhance the prestige of the Burmese Government, both internally
and. in the eyes of the outside world. Finally, the Burmese Govern-
ment would be free, if it desired, to focus primary attention on
its other major antagonists, the Communists and the allied Peoples
Volunteer Organization (PVC)), who are now firmly entrenched to the
northwest of Rangoon along the Irrawaddy River, obstructing the main
communication links between Upper and Lower Burma.
NEWS N(IfES
!ationalist air raids on Communist China have been extended to
south China where targets in the city of Canton, along the rail
lines leading south, and in the area of Shumchun, just across the
Hong Kong border, have been bombed and strafed According to a
3 March Reuters dispatch from Hong Kong, RAF Spitfires, operating
inside the British border, Mprevented continuance" of a CAF attack
on Shumchun when the raiders were "unable to start or finish strafing
rune over British territory".
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The Cuban Overseas Chinese League for Democraa has declared
its support for the "People's Republic of China", according to a
2 March broadcast of the Chinese Communist New China News Agency.
A resolution was passed in a meeting at Santiago in January re-
naming the organization the "New Democratic League of the Over-
seas Chinese in the Americas" and stating as its aim "the unifi-
cation and mobilization of the Overseas Chinese organizations in
the Americas to support the People's Republic wholeheartedly..."
Another aim of the League, according to this report, is the pro-
tection of Overseas Chinese Interests in the Western Hemisphere.
Of an estimated 1.200,_004 tons of Thai rice available for ex-
port this year, a large part has already been committed under gov-
ernment-to-government negotiation, The UK has contracted for some
400,000 tons at 1949 prices for their Far Eastern territories,
Japan will absorb upwards of 300,000 tons under a barter agreement
and Indonesia has just contracted for 12,000 tons a month with
deliveries to begin in two weeks
No re-
ports o possible Indian purchases have been receive , that
country received some 300,000 tons in 1949 and is expected to be
in the market ain this year. Although
Soviet interest in Thai rice surpluses presum-
ably on behalf of Communist China), it is probable that only very
minor quantities will be available should any firm USSR offers be
extended.
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). C
$l .:Ti4N Ill. COMUUUNISM IN EAST ASIA
At the Asian Trade Union Conference in Peiping :last December,,
MAD Tse--tung'ss tactics in China ? -the estabiisltnent of a "united
front" and the amoloyment of armed forces in open civil war ->- were
approved for the Communist Parties of Indochina, Indonesia, Pal.aaya,
Thailand and the Philippines, (other tactics being obviously required
in India and Japan), However, the theme of "proletarian revolution"
-- a revolution organized by labor and with the overt objective of
one-party rule -- replaced MAO 's theme of "new democratic revolu=..-
tion" (the waging of the struggle by a coalition of classes),
which in turn had supplanted the old Leninist-Stalinist theory of
;'bourgeois democratic revolution" (the achleevement of independence
by a national capitalist movement),. The end result of the past two
years of ideological jockeying in East Asia has been to make labor
the chief ostensible instrument and the Cor uniets the admitted
beneficiaries of the "colonial liberation" struggle. This devel-
opment expla.t the recent glorification of the virtually non-exis-
tent labor organizations in Southeast Asia.,, the incraseed publicity
given to i8urbanism ? and ltproletartanism" in, Com+aunist Chin:,, and
indications that the "Democra"sic People 'a Coalition Fronts of P!orth
Korea will soon be replaced by one party rule
Not a Chinese but an "international" organization has been
given the task of "liberating" colonial Asia, and not Chinese but
indigenous populations are to be the major inetruaeents. .Ake the
European Cominform, the new WFTU Liaison Bureau for Asia is prob-
ably cinder firm Soviet control and enforces strict discipline upon
its members,- Moreover, its chief agencies are the native Communiet.e
non-Chinese parties of East Asia- The function of the Chinese (Cam
modiste apparently is to transmit advice, carry on intelligence,
make arms available, and adopt the-proper diplomatic postures to-
ward the "imperialist" West.
Should the Chinese Con; munists wish to expand their organizational
role in East Asia beyond this limited mission,, they possess important
advantages, including great prestige, central location, and histori-
cal affinity for other peoples of Fast Asia., Offsetting these ad
-
?anta ;es, however, are the presumed Soviet opposition to creation of
a "Balkan bloc" in East Asia (whether by a Chinese Dimitrov or Tito),
the increasing domestic subservience of Communist China to the USSR,
and the emphasis on more clearly e tical features of MAO'S revolu-
tionary theories,.
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