CHINA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R00890A001300040005-4
• Release Decision: RIFPUB
• Original Classification: C
• Document Page Count: 3
• Document Creation Date: December 9, 2016
• Document Release Date: February 17, 1999
• Sequence Number: 5
• Publication Date: January 5, 1961
• Content Type: BRIEF

Approved For Release 20091'0 300040005-4
NSC BRIEFING;-,
5 January 1961
7- a-2?, CHI4A
`479ndd i
117t~c.?
I. Despite strides Peiping making toward its goals of industrialization
and big power status, past year was a rough one internally for
regime--perhaps the worst it has encountered in past decade.
A.. Usual bouyant year-end statements on domestic achievements
have been missing,
1. In their place regime has painted a picture of a country
buffeted by terrible natural calamities.
2. More than half the total cultivated acreage said to have
been hit by worst weather in 100 years; as result, goals
for grain and light industry (which depends heavily upon
agriculture) not met.
II. We doubt that the weather was quite as bad as Peiping alleges.
A. Independent weather information does show 'drought and flood,
but not worse than in 1959.
B. We estimate that the 1960 grain crop was about the same as
in 1959--some 190,000,000 tons, or about 25 million tons less
than 1958.
C. Food supply has decreased since 1958 while population has in-
creased about 30 million.
1. Ration cuts and scattered evidence of malnutrition have
been reported. A Japanese agriculturist estimated that
many Chinese he encountered during a month's tour of
China were undernourished.
2. And the already strained food situation will almost cer-
tainly get worse during the coming winter and spring.
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"Leap Forward" slogan retained in domestic propaganda only with
respect to heavy industry.
A. Regime asserts that key heavy industry targets such as steel
and electric power have been fulfilled despite interruptions
traced to bad weather.
B. Gains in heavy industry impressive, e.g., steel output reached
over 18 million tons, making China one of the six or seven
largest producers in the world.
C. However, abrupt withdrawal of Soviet technicians in August,
transport and raw materials difficulties, and serious short-
ages of POL which developed during last five months make it
unlikely that overall industrial and investment goals will be
fulfilled.
IV. By overstressing the impact of the bad weather, the regime is very
likely trying to exonerate itself and its policies (leap forward,
communes) from blame for the current troubles.
A. Peiping no longer tries to hide fact that agriculture not
"leaping forward."
B. The commune still exists, but largely on paper only, in both
rural and urban areas.
1. In rural areas Chinese Communists have been forced by
practical failures of the commune system into a series of
modifications which in effect have resulted in the pre-
commune collective farm resuming main responsibility for
production and distribution.
-2-
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2, In urban areas communes were never permitted to play a
role in operation of key urban utilities and state-owned
factories.
3. The only remaining social innovation introduced with the
commune is the messhalls, and these have not proved a
resounding success in a nation generally short of food.
C. Regime may also be preparing ground for a return to reasonably
realistic agricultural statistics.
D. Only other effect of current troubles noted in political
sphere has been the sacking of the party first secretary in
one province particularly hard hit by calamities.
1. Search for further scapegoats will probably be pressed
in coming months, if the situation worsens; search may
reach into leadership in Peiping.
It is too early to say with confidence that the current problems
are anything more than the temporary difficulties Peiping claims.
A. Nation should be able to scrape through til next harvest on
reduced rations.
B. But effects of continuing marginal diets will further reduce
labor productivity and further undermine the confidence of the
Chinese in regime's ability to deal with nation's age-old
problems.
C. A third successive bad crop year might seriously shake the
regime.
Approved For Release 2000/08/29 : CIA-RDP79R00890A001300040005-4