THE SITUATION IN SOUTH VIETNAM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00472A001700040004-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 20, 2016
• Document Release Date: July 14, 2005
• Sequence Number: 4
• Publication Date: April 21, 1965
• Content Type: REPORT

25X1
S EC R EArproved F# elease 2006/03/17 : CIA-RDP79T00 001700040004-6
OCI No. 0616/65
Copy No. ; ={
WEEKLY REPORT
THE SITUATION IN SOUTH VIETNAM
21 April 1965
DIA review(s) completed.
ARMY and DOS review(s) completed.
INTELLIGENCE AND REPORTING SUBCOMMITTEE OF THE INTERAGENCY
VIETNAM COORDINATING COMMITTEE 25X1
SECRET
GROUP I
Excluded from automatic
downgrading and declassification
Approved For Release 2006/03/17 : CIA-RDP79T00472A0017000400046
 25X1 Approved For Release 2006/03/17 : CIA-RDP79T00472AO01700040004-6
Approved For Release 2006/03/17 : CIA-RDP79T00472AO01700040004-6
 Approved For 1'!
OCI No. 0616/65
Published by the Directorate of Intelligence
Central Intelligence Agency
THE SITUATION IN SOUTH VIETNAM
(15-21 April 1965)
C O N T E N T S
Page
THE WEEK IN PERSPECTIVE iii
Map, South Vietnam v
I. SITUATION WITHIN SOUTH VIETNAM 1
A. POLITICAL SITUATION 1
Admiral Cang's suspension sustains
tension in armed forces (p. 1) ;
Catholics concerned over military
shifts (p. 1); Buddhists criticize
Viet Cong atrocities (p. 2); Quat
tours provinces, talks with Monta-
gnards (p. 3); one US contract'em-
ployee killed in ambush (p. 4).
B. MILITARY SITUATION 5
Viet Cong activity low but new of-
fensive is still expected (p. 5);
VC defector total sets record for
second week in row (p. 5); ARVN
operations down but include note-
worthy actions-in Tay Ninh (P. 7);
Phuoc Thanh .(p. 8); and Binh Dinh
(p. 8); MACV raises infiltration
Appravg2 l-e& F $eas%)2006/03/17: CIA-RDP79T00472A001700040004-6
25X1
 Page
C. RURAL RECONSTRUCTION 10
RVNAF commander orders Hop Tac
emulation in other three corps
areas (p. 10) ; some Montagnard
militia surrendering arms, to VC
or to ARVN to avoid VC harassment
(p. 10).
Rice price up (p. 12) USOM study of
Viet Cong taxation (p. 12).
Reaction to Sihanouk's call'for
new Cambodian conference (p. 14);
Saigon diplomatic initiatives
(p. 14); New Zealand considering
combat troops for South Vietnam
(p. 15).
III. DEVELOPMENTS IN THE BLOC 16
DRV delegation in Moscow gets
new conditional pledge of sup-
port (p. 16); Asian Communists
confer in Kunming enroute to
Bandung anniversary (p. 16) ;
Hanoi stresses unyielding pre-
conditions for settlement talks
(p. 17) ; DRV National Assembly
reflects efforts to put economy
on war footing (p. 17).
Approved Foil Release 2006/03/17 : CIA-RDP79T00472A001700040004-6
SECRET
 Approved F
THE WEEK IN PERSPECTIVE
Political tension persists in the wake of the recent naval
mutiny, now centering on the issue of whether or not the officers
responsible for the mutiny should be punished. Armed Forces
Commander General Minh and his supporters favor disciplinary
action on principle, while Premier Quat, backed by younger
generals who sympathize with the revolt, is urging a postpone-
ment of disciplinary action until the charges against Admiral Cang
are investigated.
Quat is reported to have made the key decisions so far
in the handling of the mutiny and the subsequent suspension of Cang
as well as of Saigon area commander General Dong. The premier
is described by one of his close advisers as generally satisfied
with the progress he has made in gaining control over the military.
Militant Catholic circles, while seemingly unconcerned
about the personal fate of Admiral Cang, nevertheless remain con-
vinced that there is a conspiracy between certain generals and the
Buddhists to gain control of the military and the police. The
Catholics appear to regard Quat as a witting or unwitting tool of
this conspiracy, but reportedly contemplate no early drastic
counteraction.
Activity during the reporting period tended to substantiate
previous indications that the Communists are feeling the effects
of recent ARVN successes and increased US participation. Sev-
eral recent ARVN ground operations and combined Vietnamese-US
air strikes may have delayed Viet Cong offensive planning, but
present information indicates that most of the Viet Cong main
force units remain relatively unharmed and retain the capability
to launch major attacks in an attempt to regain the initiative and
to achieve a significant psychological victory. There are indica-
tions of substantial Viet Cong concentrations in the central high-
lands bordering southern Laos on the periphery of the Hop Tac
area, and in relatively close proximity to critical US installations
in the northern provinces where there have been some minor
probing actions.
25X1
25X1
Approved Fo
SECRET
 Approved F efeas A M1? R "T"" "iRvi100040004-6 25X1
Hanoi's leaders in response to the stepped-up level of
attacks on North Vietnam, have undertaken major policy initia-
tives in both foreign and. domestic affairs in the past two weeks.
Within the bloc, the Vietnamese have initiated serious consulta-
tions with both the Soviet Union and Communist China at the
highest political levels. Premier Pham Van Dong, in an appar-
ent response to President Johnson's 7 April speech, spelled out
the basic position-. of the DRV as to a possible political settlement
of the war in Vietnam and then traveled to Indonesia for the
Bandung Tenth anniversary celebrations in an effort to rally
Asian support for a condemnation of US policy in Vietnam. For
consumption at home, major government personalities at a
National Assembly session urged the people to focus attention
on the problem of countering US "aggression." The general tone
of the National Assembly statements indicated an initial effort
on the part of the DRV leadership to put the country on a wartime
footing.
25X1
Approved
SECRET
 Approved F 2elease 2006/03/17 : CIA-RDP79T00472A001700040004-6
Muang
Sakon Nakt
M
Nakhon Phanom
on k,4
Ubono -\-/--
Mo++ Warin
Chamrap
toc Binh Thanh
pecial,on eoouc
'SHUN PANIANG
(; 1
T
CAPITAL M1LItARR i DISTRI
C
5th Divi t
NORTH,
VIETNAI
Qu
1 2-
1 Jam`
DEMARCATION LINO
boo Ho Su oQli~ng Tri
Tcheponel (3
~? '7' tit t
st Div n
1: t1
oLo
r) Nin
n ?'1` o
Loc
I A Y IN11
nh X113E
o huoc
H U C)i
?,()N(3
I CORPS
MGI DA NANO
aVa Nang (Tourane)
? (oPha(YThiet
I
r iy 'w Tan
aQhuoc Le CO " G V u n g Tau I I I CO r
BIEN HCJA
Ru g Sat Special
.Z e. (V N N
_v H~JA L'+IA nIN
7th Division
t'.
S 0
LD 0?,>Ei o n
YEN
BOUNDARY REPRESENTATION---.I$
NOT NECESSARILY AUTHORITATIVE
,IV CORPS
Con Son (Poulo Condore)
!'
CON SON
11 W SON
SOUTH VIETNAM
MILITARY BOUNDARIES
As of 8 March 1965
OS Corps boundary
Special zone boundary
-- Division boundary
Hop Tac area
46993
0 25 X50 75 100 Miles
6 25 50 75 100 Kilometers
2AO01700040004-6
 Approved For Ras
I. SITUATION WITHIN SOUTH VIETNAM
A. POLITICAL SITUATION
1. Tension within the armed forces has per-
sisted in the wake of the recent naval mutiny
which led to the suspension of naval commander
Cang. The immediate source of friction is the
question of punishing at least four of the
rebel naval officers. Armed Forces Commander
General Minh and his supporters favor disciplin-
ary action in order to uphold the principle of
command authority. Premier Quat, on the other
hand, reportedly desires to postpone the issue
pending the outcome of a military inquiry into
the charges against Admiral Cang.
2. Quat's own role in recent military events
has become increasingly evident, and he may
wish to avoid a full-blown inquiry as well as to
avert a new source of controversy within the
military.
25X1
25X1
25X1
Approved For ReI4
SECRET
 Approved For Rote 2AAAS_ g T_
- 2"01700040004-6
f WWW1 I I
4. The extent to which Quat is either influ-
enced by or is manipulating certain officers in
his planning is still unclear. Air Vice Marshal
Ky, who played down any religious significance
in recent events, has described the suspensions
of Cang and Dong as part of a continuing purge
of "bad elements" in the Armed Forces Council.
He has indicated that this purge is nearing
completion, except for one or two officers,
after which the situation would tend to stabil-
ize. Comments by one of the rebellious naval
officers that General Minh and Defense Minister
General Thieu had profited from Admiral Cang's
corruption may-indicate the remaining targets
of Ky's "purge." The removal of Minh is known
to be one of Quat's goals, but his views in
general may not necessarily coincide with those
of Ky and other "Young Turks."
25X1
5. One of the more extremist refugee
Catholic priests, Father Mai Ngoc Khue, in a
recent conversation with a US Embassy officer
characterized the relief-of Admiral Cang as
an internal naval affair. He also observed
that Cang, while"a Catholic, was a supporter
of General Khang. Khue nevertheless dwelt in
some detail on what he termed a "conspiracy"
between Generals Ky, Thi, Police Director Colo-
nel Lieu, and the Buddhist Institute to gain
control of the armed forces and security services.
As proof, he presented a report of Lieu's al-
leged purge of "nationalists" in the police
service. Khue indicated that the Catholics
were still unhappy with the Quat government,
believing the premier a tool of this "con-
spiracy" and suspecting that he may be nego-
tiating with the Viet Cong. Although Khue ad-
mitted that former plotters Colonel Pham Ngoc
Thao and General Lam Van Phat were still active,
he claimed that the Catholics contemplated no
early drastic action such as demonstrations or
coup plotting,
6. Government plans to try before a mili-
tary court on 26 April 24 officers implicated
in the abortive February coup may further dis-
turb Catholic circles, some of which supported
Approved For Rel
25X1
 Approved For RaFea - 1700040004-6
the coup attempt and are apparently still harbor-
ing Thao and Phat in the Saigon area. Twenty-
five of the officers originally apprehended are
said to have been released; government and mil-
itary authorities reportedly had promised some
of the detainees liberal treatment in the hope
of persuading Thao to :Leave the country. Mean-
while, Premier Quat has also indicated a desire
to hold trials for members of former President
Diem's cabinet or Can Lao Party, some of whom
have been imprisoned since Diem's overthrow.
Quat observed that these prisoners could not be
held indefinitely; their trials, however, could
stir up both Catholic and Buddhist circles.
7. The Buddhist hierarchy has continued to
hold weekend prayer services for alleged victims
of Viet Cong atrocities in the provinces. The
Buddhist Institute reportedly issued a recent
communique warning that all monks and nuns en-
gaging in political activities would be "es-
tranged" from the community. An institute spokes-
man has denied any Buddhist pressure in the re-
cent suspension of General Dong and Admiral Cang.
On 20 April, a young Buddhist monk was reported
to have committed suicide by burning nea.r the
Buddhist Institute in Saigon, leaving a note
that he was sacrificing his life because of the
need to end the suffering from the war There
is no evidence so far that his death was sanc-
tioned by the hierarchy or is the forerunner of
a new Buddhist campaign for peace. However, a
still unconfirmed report states that monks and
nuns in Saigon have resolved to request a two-
day ceasefire during Buddha's birthday celebra-
tions in May. A similar request last year was
ignored by both sides.
8. Premier Quat continues a series of visits
to the provinces, following up his trips to I
Corps and the delta with a tour last week in
the central highlands. Quat appeared impressed
by the expressions of loyalty and respect from
local military authorities. In Pleiku, he in-
augurated a technical training school for
Approved For Rel
25X1
SECRET
 Approved For Rot as ~ ~ P79T00 " O" i 700040004-6
mountain tribesmen, stressing the unity of all
Vietnamese and the determination of his govern-
ment to make no empty promises to the tribes.
The government has begun a program of land reg-
istration in tribal areas, where there have long
been land disputes between the tribes and ethnic
Vietnamese settlers. Registration will be com-
plicated, however, by the nomadic habits of the
tribes and their tradition of communal owner-
ship.
In other recent steps, the government
has convened a press seminar to deal with censor-
ship regulations, a seminar of provincial offi-
cials to explain procedures for the 30 May munic-
ipal and provincial council elections, and has
imposed tighter controls on night-club morality
in Saigon. The government also dissolved the
Directorate General of Civil Service, granting
the individual ministries authority for personnel
administration, except in matters of salary
scales and criteria for promotion. This move
seems likely to increase political influence in
civil service hiring.
9. Premier Quat also reported that, while
he was en route from Bien Hoa Airfield near
Saigon to Dalat, both engines of his C-47 air-
craft ceased simultaneously; the plane was
able to return to Bien Hoa when one engine was
successfully restarted. The possibility of
a deliberate attempt on Quat's life is under
investigation.
10. An American contract employee of the
US AID Mission was killed on 19 April, along
with two Vietnamese escorting his jeep, in a
Viet Cong ambush near Saigon on the main high-
way to Bien Hoa. The Viet Cong had set up a
roadblock on the highway, a major artery. The
same day, a bomb explosion in a bar in Ban Me
Thuot, Darlac Province, killed 11 Vietnamese
and wounded 41 persons, including four American
servicemen. On 14 April in acting on a tip,
police searched a private home in Saigon-Cholon
and uncovered a small quantity of mines, TNT, a
pistol and ammunition, and a mortar shell.
25X1
25X1
Approved For Re
SECRET
 Approved For 6aie
B. MILITARY SITUATION
1. Information received during the past week
reinforces previous indications that the Viet
Cong have been undergoing a general period of
training, regrouping, and resupply preparatory
to initiating offensive operations. Viet Cong
activity remained at a low level and consisted
mostly of harassing actions. Viet Cong main
force units continued to avoid contact with gov-
ernment forces while irregular forces were used
to initiate incidents. US air action in South
Vietnam and recent successful ARVN operations
may have delayed the anticipated Viet Cong of-
fensive. It is still expected, however, that
a Communist offensive will commence with the
advent of the rainy season in an effort to re-
gain the initiative.
Communist-initiated activity remained
substantially the same as last week in I, II,
and III Corps, but increased in IV Corps. The
IV Corps pattern of Viet Cong activity remained
the same, consisting primarily of terrorism
against small government forces and positions;
only one small attack and one ambush were re-
ported.
In I Corps, the most significant Viet
Cong activity was the harassment of the Quang
Tri Province capital by 81-mm mortar fire.
Eighteen rounds fell on the US advisor's quar-
ters and 100 rounds fell on an ARVN bivouac
position. Friendly losses were nine civilians
killed, and 20 civilians, three US personnel,
and one ARVN soldier wounded. Remaining inci-
dents consisted of low-level harassment,`includ-
ing kidnapings and assassinations directed
against officials in areas of nominal government
control.
In the II Corps area, an ARVN convoy was
ambushed on Route 14 in Kontum Province. The
ambush site was in the suspected operational
area of a battalion of the 101st PAVN regiment.
25X1
25X1
Approved For RO
 Approved For ale OAAAA c -DP79T00472A0 1700040004-6
An explosion occurred in the ammunition storage
area of a US aviation company at the Qtii Nhon
Airfield, Binh Dinh Province. It has not been
determined whether this explosion was the result
of Viet Cong action. The trend of large weapon
losses resulting from unopposed hamlet entries
continued in Darlac Province. Four Montagnard
hamlets within a 25-kilometer radius of Ban
Me Thuot were entered by the Viet Cong without
opposition. There were no friendly casualties,
but a total of 135 individual weapons were lost
by the government. In four other Montagnard
hamlets in Darlac Province, the militia turned
in their weapons to government forces with the
explanation that they were tired of being at-
tacked, terrorized, and harassed by the Viet
Cong.
In III Corps, a group of Viet Cong on
bicycles terrorized the province capital of
Binh Duong Province, detonating mines and
lobbing grenades at the headquarters building
of the Vietnamese Military Security Service.
Main force units in III Corps are believed to
be preparing to launch offensive operations in
the southern periphery of War Zone D and Long
Khanh Province.
Viet Cong incidents in IV Corps again
failed to involve main force units, reinforcing
reports that the main forces have withdrawn into
base areas for training, reorganization, and
the issuance of the new family of ChiCom indi-
vidual weapons.
This week 147 Viet Cong military personnel
returned to the government under the Chieu Hoi
program, as compared to 129 last week. This
is the second week in a row to set a new record
for military returnees. Continued defection to
the government of large numbers of Viet Cong
military personnel would give considerable sub-
stantiation to reports of low Viet Cong morale
and their fear of US air strikes.
25X1
25X1
Approved For
SECRET
 Approved ForQel SEGMT,
--- 00063 01700040004-6
T --
2. ARVN ground operational activity de-
creased this week, both in numbers and in con-
tacts with the Viet Cong. There were 75 opera-
tions in battalion strength or larger, of which
31 made contact with the enemy. This compares
to 82 operations last week, 40 of which re-
sulted in enemy contact. Small-unit actions
this week totalled 16,217, of which only 49
resulted in contact. There were 17,126 small
unit operations last week, 68 of which resulted
in contact.
Government casualties declined to 357
(90 KIA) from 665 (155 KIA) last week. Communist
losses also declined, with 260 Viet Cong killed
as compared to 643 killed last week. The gov-
ernment lost 315 weapons, compared to the Com-
munist loss of only 80. This compares to 115
lost by the government last week and 238 lost
by the Viet Cong.
3. An operation conducted by US and Vietnam-
ese forces in Tay Ninh Province during the week
made up one of the largest joint combat opera-
t.ons since World War II. Intelligence reports
for an extended period of time had indicated that
a Viet Cong stronghold, possibly the Central
Office for South Vietnam (COSVN) headquarters,
was located in northern Tay Ninh Province.
The operation called for a systematic satura-
tion bombing of an area approximately three by
six kilometers, believed to include Viet Cong
workshops, weapons, ammunition, supply depots,
training and rest and recuperation centers,
and district and provincial headquarters. The
bombing was followed by an ARVN search-and-clear
operation to destroy Viet Cong personnel and
installations surviving the air attacks and to
verify the effects of the bombing.
On 15 April, 417 sorties delivered'860
tons of high explosives on the target area.
The ground operation began the following day,
with one airborne and two infantry battalions
airlifted into the target area. The operation
terminated on 18 April with no friendly casualties.
25X1
25X1
Approved For Ro
spi caE 1.
 Approved Foi.
There were no confirmed Viet Cong casualties, but
odors from some tunnels and bomb craters suggested
the presence of corpses. Viet Cong losses were
one individual weapon, one switchboard, two
radios and batteries, telephone wire, grenades,
and mines, 108 huts and buildings destroyed,
and two tons of rice. The destroyed structures
included five communication buildings and four
signal training classrooms.
While the operation apparently failed
to inflict significant casualties or materiel
losses, the operation should have a significant
psychological effect on the Viet Cong. The
saturation bombing of a previously safe area
emphasized that no territory controlled by the
Viet Cong is safe from US/Vietnamese actions.
It presumably disrupted Viet Cong organization,
logistic support, and training ih the area
served by the Tay Ninh stronghold. ARVN morale
and confidence also appear to benefit from such
operations.
4. Another major operation was the penetra-
tion of a major Viet Cong supply area in Phuoc
Thanh Province. The operation, starting last
week and continuing into this reporting period,
resulted in the destruction of Viet Cong sup-
plies and transportation. Two hundred and thirty
tons of rice, 50 bolts of cloth, 300 black uni-
forms, 25 boxes of soap, 880 gallons of gasoline,
460 bags of soybeans, 700,000 rounds of small
arms ammunition and six trucks plus a gasoline
tanker were either captured or destroyed. The
fact that the storage area was located in a
corridor between Long Khanh Province and War
Zones C and D emphasized its regional character
and its suitability as a distribution point.
5. In Binh Dinh Province, an infantry bat-
talion reinforced by an armored cavalry troop
and three Scout Reconnaissance companies clashed
with a Viet Cong main force battalion equipped
with bloc 7.62mm weapons, supported by a local
company. Final results were 106 Viet'Cong
killed (confirmed) and three captured, as com-
pared with friendly losses of only sevel killed
and 20 wounded. Of the Viet Cong dead, approxi-
mately one-half were created to air and artillery
Approved For Release 2006/03/17 : CIA-RDP79T00472 001700040004-6
25X1
25X1
 S+ GR I: 25X1
Approved Fot`ReIea fe 205707 -17 : t - 7QA001700040004-6
This operation was based on good intelligence,
and the fight was aggressively carried to the
enemy by ground forces. Prior planning in hav-
ing air on station and artillery well forward
provided the firepower required for the opera-
tion when needed.
6. Evalu tion of recently received informa-
tion has caused MACV to change its infiltra-
tion figures. Now 1,200 personnel are reflected
as having infiltrated during 1965 on the basis
of one rallier reporting the infiltration
of elements of the 325th PAVN Regiment. Total
confirmed and probable infiltration strengths
by year as a result of the new information is
as follows:
1959-60 4,556
1961 5,443
1962 12,475
1963 7,713
1964 8,130
1965 1 200
Total 39P5I7i
Approved F
SECRET
 Approved Fogel -
001700040004-6
C. RURAL RECONSTRUCTION
1. An indication of revived concentration
on rural reconstruction efforts was evident'in
an order from the commander-in-chief, RVNAF,
which directed the commanders of I, II, and IV
Corps to initiate programs in their respective
areas based on the Hop Tac concept. The corps
commanders were also ordered to report on the
progress of their plans at a conference sched-
uled for early May.
To assist the staffs of the corps areas
affected by this order, a seminar on the Hop
Tac plan was conducted in Saigon on 16-17 April.
A parallel US advisory seminar was conducted
during the same period with representatives from
I, II, and IV Corps in attendance. The back-
ground and concepts of the original Hop Tac
plan were discussed and planning guidance
offered for its application in other areas.
2. The 21st Division headquarters conducted
a rural reconstruction conference on 12-13
April to evaluate the status of current efforts,
give new directions, and discuss problems en-
countered. Twenty-three of the 26 districts in
the division tactical area sent representatives
to the meeting, which was also attended by rural
reconstruction officers from IV Corps and their
US counterparts.
3. In Darlac Province, Montagnard militia
units last week turned in 171 weapons to the
government. The main reason they gave was that
they were tired of being terrorized and harassed
by the Viet Cong. Significantly, all the units
which turned in weapons had participated in an
"oath ceremony" in January when they pledged that,
in return for arms, they would defend their
villages against the Communists.
Also in Darlac Province, the Viet Cong
made unopposed entries into four other Montagnard
hamlets and a land redevelopment center and took
away about 170 individual weapons and some com-
munications equipment. The four hamlets entered
-10-
Approved For Relea~
25X1
25X1
SEGRET
 Approved Fo
were within 25 kilometers of the province capital,
Ban Me Thuot. This loss of weapons to the Viet
Cong as the result of unopposed entries into
Montagnard centers continues a trend noted since
at least December 1964.
25X1
Approved For 9
SECRET
 25X1
Approved Fo .Rele
D. ECONOMIC SITUATION
1. The wholesale rice price continues to
climb. After a visit to rice collection centers
the economy minister pointed to speculation by
traders and Viet Cong resource control as major
factors affecting the current rice situation.
To date, the ARVN has been unable, uninterested,
and ineffective in dealing with the rice col-
lection problem.
2. A separate USOM study on Viet Cong taxa-
tion tends to confirm that the Viet Cong control
a significant portion of the rural economy,
particularly rice production and trade. The
study concludes
that Viet Cong taxation, enforced by terroristic
coercion, is an efficiently organized and highly
effective system of revenue collection. The
study confirms that Viet Cong collection methods
and assessment standards have become increasingly
formalized and that the tax collections are sub-
stantial.
Rice taxation, paid in kind and in cash,
constitutes the major portion of Communist tax
revenue. Rice taxation is imposed on a graduated
basis from about five to more than 25 percent of
the crop yield--with higher penalty rates for
those who have relatives in ARVN or the govern-
ment civilian service. Rice, the major commodity
in domestic commerce, is also subject to Viet
Cong taxation during milling, transportation,
and marketing.
Communist taxes are imposed on road and
river transportation of all kinds under the
threat of reptisal. In areas controlled by
the Viet Cong, import and export duties are im-
posed--with attempts to discourage luxury im-
ports of cigarettes and liquor by the popula-
tion through high tax rates. Taxes are also
imposed on farm produce of all kinds, live-
stock, and farm equipment. Under threat of kid-
naping, owners of rubber, tea, and coffee plan-
tations apparently make regular payments to the
Viet Cong.
Approved For Rel
25X1
SEGRET
 25X1
Approved For.Rel - 001700040004-6
The ability of the Viet Cong to extract
financial support and resources from the local
population is extensive. It appears, moreover,
that to date the Viet Cong have permitted the
normal operation of the economy, subject to
their taxation. The present rice situation
and the recently reported distribution of Viet
Cong currency in the delta could signal a
change to a strategy of denying resources to
government-controlled areas.
25X1
Approved For R+Iease 2006/03/17: CIA-RDP79T00472AQ
SECRET
 Approved Foi%Relea
TIX
II. THIRD COUNTRY DEVELOPMENTS
1. The South Vietnamese government, replying
through Tokyo to Prince Sihanouk's call for a
Geneva conference on Cambodia, has stated its
preference for a revival of bilateral discussions.
Saigon also affirmed its respect for Cambodian
neutrality and territorial integrity as sovereign
concerns of Cambodia.
2. Ambassador Taylor commented last week
that a Geneva conference on Cambodia would ac-
complish little because of the following factors:
Thailand would not be present, inasmuch as it did
not attend the 1954 conference; the Quat govern-
ment might fall if the US were to pressure the GVN
to attend; and Sihanouk has indicated his disinterest
in talking to the present Saigon government.
3. Saigon is reviewing Mekong River controls
to determine whether measures are needed to refine
controls and make them more effective. Discrepancies
have appeared between Cambodian import statistics
and Mekong shipping statistics, and some ships
heading for Phnom Penh have carried manifests des-
cribing their cargo in vague and general terms.
B. AFRICA
4. Deputy Prime Minister Tran Van Tuyen left
12 April on a five-week goodwill mission to eight
African capitals--Abidjan, Dakar, Rabat, Lagos,
Addis Ababa, Cairo, Tananarive and Tunis. Tuyen
started the tour by visiting Paris, where he alleg-
edly hinted that Saigon might particpate in an in-
ternational conference on Cambodia.
There is also evidence that the GVN is con-
sidering appointment of ambassadors to several
African, Asian and European posts.
C. THIRD COUNTRY ASSISTANCE
5. A second Philippine medical team of 34
military doctors, nurses, and civic action specialists
arrived in Saigon on 17 April.
25X1
25X1
Approved For Relea
3EGXET
 SECRET
Approved FoI eIeasI1DU611T31'IT:Z - 47 001700040004-6
6. Our Embassy in New Zealand reports that the
cabinet agreed, during a 20 April meeting with roving
Ambassador Lodge and Ambassador Powell, to consider
sending a small combat unit to South Vietnam. New
Zealand could either withdraw two companies from
Malaysia and send them to South Vietnam, or perhaps
provide an artillery battalion. The action would
not be taken immediately, to avoid connection of
Ambassador Lodge's visit with a decision to help
South Vietnam. This is the most encouraging indica-
tion so far that New Zealand is willing to help
South Vietnam with combat troops, but the govern-
ment may have some difficulty lining up public sup-
port for such a move.
25X1
25X1
Approved For Re
 .F,..~..25X1
Approved Fo+r.Relea ,., - 001700040004-6
III. DEVELOPMENTS IN THE BLOC
A. INTRA-BLOC RELATIONS
1. On 175April Moscow released a joint Soviet-
DRV communique which constituted the first acknowledge-
ment that a North Vietnamese delegation, headed by
party leader Le Duan, had been in Moscow since 10 April.
The highlight of the communique was a cautious, con-
ditional pledge to send Soviet volunteers to North
Vietnam if the DRV government requested them. The
pledge could have been calculated to set the stage for
a future announcement of the dispatch of Soviet per-
sonnel to the DRV to man Soviet SAM equipment which
may be enroute to North Vietnam. The communique did
not address itself to the subject of a conference on
Vietnam, but it did say that an international confer-
ence on Laos and Cambodia would be useful. The com-
munique is a strong Soviet endorsement of North Viet-
namese political objectives, and Hanoi comment on
the communique called it "a brilliant expression of
Soviet-Vietnamese unity of mind."
The Le Duan delegation, which includes Defense
Minister Vo Nguyen Giap and Foreign Minister Nguyen
Duy Trinh, now is in Peiping for consultations with
the Chinese leadership.
2. High-level consultations also took place
this week in Kunming among the Chinese, the Vietnamese,
and the Laotian Communists. Prince Souphannavong
joined North Vietnamese Premier Pham Van Dong in a
trip to Kunming for consultations with Chen Yi and
perhaps Chou En-lai before all three country delega-
tions took off for Indonesia and the 10th anniversary
celebrations of the Bandung Conference. Also in
Indonesia for the opening ceremonies were Korean
Communist leader Kim II-song and a representative
of the National Front for the Liberation of South
Vietnam. This impressive array of Asian Communist
leaders has helped to focus the Bandung celebrations
on a condemnation of US policy in Vietnam.
B. PROPOSALS FOR VIETNAM SETTLEMENT
1. Before leaving for Bandung, Premier Pham Van
Dong reported at length to the DRV National Assembly.
25X1
Approved For Re1e4
3EGREr
 Approved Foy.Relealse 2006103117 ;'RF,T____ _ 7 01700040004-6
His speech, made on 8 April and broadcast by Hanoi
on 12 April, has been widely cited as the official
North Vietnamese answer to President Johnson's
7 April speech in Baltimore. Pham's statement re-
peats the standard North Vietnamese formula for a
settlement of the Vietnam situation. The provisions
include the withdrawal of US troops and weapons,
cancelling of the US military alliance with South
Vietnam, the cessation of US "acts of war" against
North Vietnam, the settling of the internal affairs
of South Vietnam by the South Vietnamese people them-
selves in accordance with the program of the Libera-
tion Front, and settlement of the question of reuni-
fication by North and South Vietnam without foreign
interference. The Premier declared that this stand
is "the basis for the soundest political settlement
of the Vietnam problem." He added that if this basis
"is recognized," favorable conditions will be created
for the peaceful settlement of the Vietnam problem
and it will be possible to consider the reconvening
of an international conference along the pattern of
the 1954 Geneva Conference on Vietnam.
2. The National Assembly also passed a resolu-
tion appealing to world parliaments for support.
Both the Chinese National People's Congress and
the Liberation Front responded quickly. Peiping
answered on 20 April that the Chinese people had
been instructed to make "full preparations" to
send men to fight alongside the Vietnamese "people"
in the event that the US "continues to expand the
war" and the "Vietnamese people need them."
The Front's response, adopted at a 15 April
presidium session, stressed the unity of the Front
with the North Vietnamese in the "struggle" against
"US aggression." In spelling out the Front's posi-
tion on settling the war, thecommuniqu6 declared that
the "basic stand" of the NFLSV consists of fighting
the "US imperialists.. . to the end," and that any
"solution" for South Vietnam will be "unrealistic
and impractical" if it "disregards the participation
and decisive position of the NFLSV." This relatively
cautious formulation on the position of the Front
may have been intended to leave some room for man-
euver on the exact role and status of the Front in
any future move toward a settlement in Vietnam.
-17-
25X1
25X1
Approved For Relea
SECRET
 Approved Foiele
se
3. On 19 April the DRV news agency announced
that it had been authorized by the DRV Government
to make a statement on the appeal from the 17
nonaligned nations. While the agency's statement
did not specifically reject the appeal, it cited
Premier Pham Van Dong's four-point proposal, and
said any proposal which did not include these
provisions was inappropriate. The statement
specifically cited UN mediation efforts as a
case in point.
25X1
25X1
Approved For Re
 Approved Fele
C. INTERNAL NORTH VIETNAM
1. All of the speeches at the'DRV National
Assembly session from 8-10 April dwelt at length
on the problems created by the "new situation"
in the Vietnamese war. The Assembly passed
new legislation for manpower mobilization by
extending the enlistment period and revising
the draft law. All speakers emphasized the
need for close coordination of economic ac-
tivity with defense requirements, and Pham Van
Dong indicated that the regime is not putting
any great emphasis on its program of industri-
alization or capital improvement. The regime
apparently is concentrating its economic ef-
forts on the improvement of agricultural pro-
duction and the development of"local small-
scale industry and handicrafts. The Premier
also stressed the theme of self-sufficiency
and the need to make the economy as self-
sustaining as possible.
2. The withdrawal of dependents of foreign
diplomatic personnel, requested by Hanoi this
week, testifies to the determination of North
Vietnam to continue the war as well as to its
fear that the attacks may be extended to Hanoi.
25X1
25X1
Approved For Relea
SE RE T
 Approved For Rise 2006/03/17 : CIA-RDP79T00472AW700040004-6
SECRET
SECRET
Approved For Release 2006/03/17 : CIA-RDP79T00472AO01700040004-6