COMMUNIST CHINA'S EFFORT TO OBTAIN SHIPBUILDING AID FROM WESTERN COUNTRIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01003A001900100001-9
• Release Decision: RIPPUB
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• Document Page Count: 14
• Document Creation Date: November 16, 2016
• Document Release Date: November 29, 1999
• Sequence Number: 1
• Publication Date: February 1, 1964
• Content Type: BRIEF

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SECRET 1.#
J FOREIGN DISSEM
Current Support Brief
COMMUNIST CHINA'S EFFORT TO OBTAIN SHIPBUILDING AID
FROM WESTERN COUNTRIES
CIA/ RR CB 64-15
February 1964
CENTRAL INTELLIGENCE AGENCY
Office of Research and Reports
NO FOREIGN DISSEM
SECRET
GROUP 1
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This material contains information affecting
the National Defense of the United States
within the meaning of the espionage laws,
Title 18, USC, Sees. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
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COMMUNIST CHINA'S EFFORT TO OBTAIN SHIPBUILDING AID
FROM WESTERN COUNTRIES
Communist China for the past 2 years has shown an unusual interest
in shipbuilding in Western Europe, an interest that has taken the form of
visits to European shipyards and industrial facilities both by technical
personnel, probably from the shipbuilding industry, and by senior govern-
ment officials. Although the official reason for such visits appeared to
be the purchase of ships, analysis of the visits indicates a considerable
interest in shipbuilding technology and an effort to persuade France and
possibly Denmark to support a program of assistance in shipbuilding.
In the years between 1952 and 1959, Communist China attempted
to enlarge its shipbuilding industry, first, by improving facilities for
the assembly of ship components and equipment supplied by the USSR
and, second, by developing an industrial base for domestic production
of components and equipment. Soviet assistance, both technical and
material, however, was withdrawn before the Chinese could develop
an adequate industrial base. Moreover, the economic setback in 1960
contributed further to the delay.
Recently, Communist China appears to have renewed its effort to
produce ships. These efforts include a move late in 1963 to raise the
administrative level of the shipbuilding industry from that of a bureau
(Ninth Bureau of the Third Ministry of Machine Building) to that of a
ministry with the creation of the Sixth Ministry of Machine Building.
Continued efforts also have been noted in construction of new ship-
building facilities. What is now believed to be of major significance
is the apparent attempt to solicit Western aid to replace the loss of
former Soviet assistance.
The first of the Chinese Communist delegations interested in
Western shipbuilding visited France between 28 June and 21 July 1962.
The arrangements for the visit of a four-man delegation were reported
to have been handled through Genema, a French shipyard syndicate.
Acting as agents for Genema was Compagnie Oliver of Paris, an import-
export firm reported to favor an expansion of French-Chinese trade.
The itinerary for visits to some 15 installations included shipyards
and industrial facilities connected with the marine industry. The stated
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purpose of these visits was to observe construction of ships; manufactur-
ing of marine engines; and production of radio, navigation equipment,
remote control apparatus, and the like. I/ Among the installations
visited were several highly capable shipyards that are experienced in
construction of both naval and merchant ships; the Compagnie General
de Tele'graphie, the largest producer of electronic equipment in France;
and the Societe Alsacienne de Construction Mecanique, a company engaged
in the French nuclear energy program, including production of reactors.
Although it is still not clear which installations actually were visited,
some of the installations reportedly visited differed from those in the
original itinerary and seemed relatively unimportant. 2/ Nevertheless,
because the French tend to affiliate their industrial enterprises into
large groups, the Chinese probably had the opportunity to contact impor-
tant representatives of many French companies.
Because the Chinese delegation was without purchasing authority,
the principal purpose of the visit was exploratory. 3/ The delegation,
however, did express a desire to purchase ships in the future and to
send technicians to observe ship construction.
The four members of the Chinese Communist delegation have not
been identified previously, but it is reported that they represented the
China Ocean Shipping Company of the Ministry of Communications.
Although a search of available biographic data showed. no record of
the individuals, the four appeared to have technical backgrounds. It
also is possible that they represented what is now the Sixth Ministry
of Machine Building.
A visit to Communist China in September 1963 of a French trade
mission headed by former Ambassador Georges Picot appears to be a
followup in part of the Chinese visit. The Chinese again expressed a
desire to purchase ships and to send another shipbuilding delegation to
France. 4/
Before touring French facilities, the four-man Chinese Communist
delegation is reported to have attended the annual International Congress
of Combustion Engines held in Copenhagen during the latter part of June
1962. Other Communist countries were represented at the International
Congress, including a Soviet member of the Central Boiler and Turbine
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Institute in Leningrad. 5/ While in Denmark the Chinese delegation prob-
ably visited the Burmeister and Wain Shipyard and two smaller shipyards.
Some negotiations undoubtedly were conducted between Communist
China and Denmark, for it was reported in December 1963 that Burmeister
and Wain is planning to send a two-man technical delegation to Peiping
for preliminary discussions on the possible construction of ships and
ship engines.
3. UK
The same four-man Chinese Communist delegation that visited France
spent part of August 1962 in the UK visiting 14 shipyards and other marine
installations. 6/ These installations are some of the more capable ship-
yards and marine equipment plants in the UK, including five shipyards
engaged in work on naval vessels and missiles and one that is involved
with the nuclear submarine program.
A six-man Chinese Communist technical delegation spent the last
part of April 1963 at the London International Engineering Exhibition.
The delegation indicated a special interest in a wide range of marine
equipment including (a) high-speed diesel engines, (b) navigational and
testing instruments, (c) high-pressure vessels and test equipment,
(d) instruments for impulse measurement and analysis, (e) servo-
mechanisms for automation, and (f) certain kinds of welding apparatus. 7/
In March and April 1963 a high-level Chinese delegation, headed
by the Vice Minister of Foreign Commerce, visited the UK. During the
course of general negotiations it is reported that the Chinese were inter-
ested in electronics and communications equipment, telecommunications
instruments, scientific measuring and control apparatus, and plastics.
Although no mention was reported of the interest in this delegation in
ships or shipbuilding, the Vice Minister and two members of his party
visited two shipyards to observe ships under construction, production
of marine engines, and prefabrication practice. 8/ One of the ship-
yards visited was engaged in naval work, including missile ships.
4. Other Western European Contacts
The four-man Chinese Communist delegation was reported to have
visited Sweden, Switzerland, and West Germany in 1962, in addition to
the visits to France and the UK, although no details are available.
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A three-man Chinese Communist delegation that is probably still
in Western Europe visited Norway and Sweden in December 1963. De-
tails of the activities of this delegation are not available, although the
delegation contacted shipbrokers and shipyards in Norway, indicating
an interest in both shipping and shipbuilding. 9/
5. Significance
One of the interesting aspects of the visits in 1962 by the Chinese
Communist delegation was the apparent followup visits to China in 1963
by delegations from both France and Denmark. These return visits
suggest that the Chinese had conducted successful preliminary negoti-
ations.
Moreover, although very little is known about the individual visits,
they appear as a whole to be of considerable importance to the Chinese
Communist shipping and shipbuilding industries. The number and
variety of installations visited in the several countries clearly reflect
an interest in technology. Although some of the contacts were made
with firms engaged in nuclear programs, there is no evidence that
the Chinese contemplate the construction of nuclear-powered ships.
At present, because of limited economic resources, it is doubtful
that Communist China can procure from Western Europe either tech-
nical or material aid of the magnitude that it had obtained earlier from
the USSR. It is believed, however, that these visits probably mark
initial efforts to obtain some Western assistance. It is highly probable
that many of the benefits of the Chinese visits derive from observation
of Western technological practices.
In addition, the visits of the Chinese delegations to France and
Denmark appear to be of a somewhat sensitive nature. No mention
of these visits was noted in the press.
The French return visit in 1962 is of singular significance because
the delegation consisted of high-level nongovernment personnel. Such a
mission was of value to France, for important subjects could be dis-
cussed without necessarily committing the French government. Further-
more, the results of the mission raised the possibility of a second Chinese
Communist shipbuilding n.ission being sent to France.
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Sources: 25X1C
1. CIA. _, 19 Jun 62. S/NOFORN/CONT CONTROL.
25X1C 2. CIA. ? 12 Sep 62. C/NO FOREIGN DISSEM.
25X1 C 3. CIA. ~, Z5 Nov 63. S/NO FOREIGN DISSEM.
4. Ibid.
25X1C 5. Air. , 28 Aug 62. C.
6. China Trade Newsletter, no 83, Sep 62, p. 5. U.
7. Ibid. , no 91, May 63, p. 2. U.
8. Far East Economic Review, p. 313-318, 9 May 63. U.
25X1C 9. CIA. S 24 Dec 63. C/NO FOREIGN DISSEM.
Analyst:
Coord:
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Effort to Obtain Shipbuilding Aid From Western Countries -_- February 1964
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Communist Caine's Effort to obtain 2ALbuilding Aid I%= Western
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