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• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000300270001-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 27, 2016
• Document Release Date: July 3, 2012
• Sequence Number: 1
• Publication Date: July 27, 1951
• Content Type: REPORT

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1
COPY NO. 14 7
CENTRAL BB TELLIGEN CE AGENCY
OFFICE OF CURREi T INTELLIGENCE
Date: JUI~2-7 51
NOTE: 1. This summary of significant reports has been
prepared primarily for the internal use of the
Office of Current Intelligence. It does not
represent a complete coverage of all current
reports in CIA or in the Office of Current
Intelligence.
2a Comments represent the preliminary views of
the Office of Current Intelligence.
Marginal letter indications are defined as
follows:
"A" m items indicating Soviet-Communist
intentions or capabilities
"B" ? important regional developments.
not necessarily related to Soviet/
Communist intentions or capabilities
"Ccr .- other imformation indicating trends
and potential developments
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SECTION 1 (SOVIET)
"A" S . EMbasa Moscow's VieNg on Molotov and Zhukov Visit to Warsaw.,
Embassy Moscow considers the appearance of Molotov and Zhukov at the
recent Polish holiday celebration indicates the Kremlin has reassessed
the international situation. According to the Embassy. the setback to
Communist aims in Korea can hardly fail to have repercussions inside the
Soviet Politburo, and it is possible that new policies will be adopted
in consequence. Molotov's reappearance as a spokesman on foreign affairs
breaks a silence that has prevailed since his last speech in March, 1950.
During this period public leadership in foreign affairs has been assumed
by lesser Soviet figures. Although Molotov's appointment as Foreign
Minister in 1939 was soon followed by a break with the Western democracies,
the Embassy points out that Molotov was also identified with the policy of
achieving a settlement with the outstanding power then threatening the USSR,
The Embassy also considers it unlikely that Zhukov was produced only for a
single appearance in Poland. He may be destined for some significant posi-i
tion such as that of an Eastern European counterpart to Eisenhower. While
Zhukov is identified with the idea of good relations with the wartime
allies, he also epitomizes successful conduct of a war. The Embassy in-.
"41 t _ I _ _
clines to the belief th
t h
a
e
military preparations in Eastern Europe. 25X1
"B" Yugoslav Official Expects Communist Cone ssiona in Korean Cease Fire
Negotiations. Yugoslav UN delegate Bebler remains optimistic that cut rent
negotiations in Korea will eventually result. in a cease-fire. Bebler be-
lieves that the Communists' desire for a cease-fire will induce them to
give in as regards the 38th Parallel demarcation line and the withdrawal
of foreign troops, but he is not optimistic about achieving UN observation
in North Korea. Bebler estimates that the Communists are insisting on the
withdraw, of all foreign troops largely for its propaganda appeal in the
Par East, while the USSR in fact will want to keep the US Arm pinned.down
in Korea daring prolonged attempts to reach a general settlement. With
regard to Soviet/Chinese Communist relations, Bebler believes that addi-
tional tensions Ise over whose influence will prevail in North Korea? 25X1
MT4ENTs Communist preliminary agenda concessions.
regar i the question of troop withdrawal are a further indication of a
desire to negotiate a cease-fire. However, it has been a continuing
Soviet objective in all areas to secure Western troop withdrawals so as to
remove a force for stability and facilitate the Communist advance.
"B" Zhukov Sends Greets s to Eisenhower, Soviet shat G.
a conversation with the K. Zhukov, in 25X1
spoke hi
hly
a h
g
o
is
close friendship with General Eisenhower, i
informed ,he was in good health and He requested that the General be
given his best wishes. T~Jje MA -P t
the Marshal had aged considerably? 25X1
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"C ,-ASTkNa CPti ZECHQsLOV.AXIA..Military Pure RePprteda -.According to a.
26 Je,ly press dispatch from Paris, the Communist regime in Czechoslovakia
has unearthed a wide-spread. plot against the security of the State, in-
volving at least four generals, Pavel, Veseliq Zadina, and Klen. The
article states that the "Ministry of War" has issued an admonition to the
various military leaders decrying the slow progress in transforming the
Czechoslovak Army into a replica of the Soviet Army , I 25X1
QQMMENT Coincident with the top-level purge of so-called national devi-
ationists within the Czechoslovak Communist Party in February 1951, there
were also purges of the military hierarchy. 25X1
Bedrich Reicin, and another unnamed official in the ministry (perhaps General
Klen, Reicinas former assistant in Counter-Intelligence) were"guilty of
conspiring against the regime and of deviations" The US Embassy Prague was
reliably informed about the same time that Generals Josef Pavel,'Deputy
Minister of National Security and Chief of the Security Police (SNB), Jindrich
Veseli, Chief of the Political Police (S'I'.6), and.Zdanek Novak, Commandant.of
the Moravian Military District, had all been removed from office. The
Sovietization process of the Czechoslovak Army has made little progress.
Only the most rudimentary training in Soviet tactics has been conducted,
very little Soviet equipment has been delivered, and the reorganization of
units and staffs to conform to the Soviet model is far from complete. The
bulk of the Czechoslovak Army is considered unreliable except in opposition
to German aggression,.
*Bn Fes, Possibility of Orbit Policy Meeting in Warsaw Undetermined. US
Embassy Warsaw reports that while there was ample opportunity following the
public National Liberation Day ceremonies for conferences between the dele-
gations of Eastern Europe and the USSR, no real information of what.may
have transpired is available. The Embassy reports, however, that at a
Soviet Embassy reception on 23 July Polish President Aierut, Prime Minister
Cyrankiewic' d.o and 'Minister of National Defense Rokossovski retired to a
'private refreshment room with the top Russian guests, presumably Molotove-
Zhukov, and Pospelovo The US Embassy discounted the likelihood of any
formal change in Soviet-Polish relations but noted a trend toward further
Soviet onfidence in and dependence upon Poland in the military and economic
fi+alds. 25X1
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"Boo 0 J , a Polish i orvregian Trade Talks Sus2endedo According to ,
Foreign Office trade negotiations with Poland have been suspended wi,h $.itt]e
likelihood of their resumption in the near 'future. Polioh,unvrrillingness -to
consider modification of their completely unacceptable demands,?.wa respon-
sible for the breakdown of the talks. As in recent negotiations with
Austria and Frances Poland demanded certain strategic goods or materials in.
return for coal. Poland specifically required Norway to counterbianace'
Polish coal deliveries by shipments of strategic goods of equal value. The
Norwregian negotiators do not believe that Poland will modify its position
unless it finds that the other Western European countries are equally ada-
mant in rejecting unreasonable Polish demands,
OMNlENT9 The exercise of strengthened and more united export controls has
recently been evident in Western Europe&s,ecconomic.relations with the Soviet
orbit. In the current Polish Austrian trade talks Austria has refused':so
far to accede to Polish demands for strategic goods. In the recently com-
.pleted'PolishWFrench trade talks France was forced to include only small
amounts of strategic goods in order to reach agreement.,' These examples of
Western unity-on the sensitive question of export controls may in part ac-
count for the USSR's recent acceptance of an tThT invitation to discuss the
improvement of East-West trade, It is likely 'that the USSR is attempting
by such multilateral discussion to weaken or split Western Europeas.stronger
approach to the control of strategic exports to the orbits, having failed to'
do so through bilateral negotiations, The USSR is expected to tempt Western
Europe by offering large quantities of needed agricultural products in am-
change for strategic goods.
WAN NOSLAV , Part Hieraraby Re' ox'tedl S lit I Over Polio .
he questions of Yugoslavia?s future economic organizatio
an the employment o US loans have produced violent discussions among top
officials. Cominform Influence Jq allegedly greater than is generally bey
lieved and is reaching the "highest levels.w Minister of Foreign Trade
Milenti,o Popovic is,,suspected.of being one of the key men in the Cominform
netration and
Yugoslav acceptance of Western arms and economic assist-l.
.ante has probably led to heated discussions within the Party and possibly
accounts for some of the recent arrests of alleged Cominformihts, In
recent weeks two Assistant Ministers in the Ministries of Finance and
Agriculture have been charged with Cominformism, and other arrests of im-
portant officials are probable.. There. is no available evidence, however,
that Pop?vic, the Minister of Foreign Trade and a Central Committee member,
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NBn INTERNATIONAL COMMUNISM. Five Power Peace Pact Given New Push. The
Helsinki meeting (20-23 July) of the Executive Committee of the World Peace
Council made the appeal for a five-power pence pact the main point in Its
principal resolution although it also.included references to the proposed
Japanese peace treaty and to the rearmament of Japan and Germany. Devoid
of the tsual Communist bombast and warmonger allegations, the resolution
is repertedly;a skillful appeal to those who are most anxious for peace,
COMMENT: The relative mildness of this reso-
lution fits into the general conciliatory atmosphere pervading Communist
tactics at present. In both 1949 and 1950 the USSR proposed a five-power
peace pact .n UN General Assembly meetings. It was taken up as the chief
Communist propaganda subject at the World Peace Council Berlin meeting in
February 1951 and was soon echoed in identical terms by substantially every
Communist Party in the world. In the present instance, an appeal to support
the Korean armistice efforts affords a new opportunity to reiterate the old
line by saying such a pact will facilitate (1) the reversion of the UN to
its original activities; (2) ultimate disarmament including prohibition of
atomic weapons; and (3) economic cooperation to raise standards of living.
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moving Iranian oil who could a :nge tankers and'. ha,,ung 'fabil .ties*
that media would; via due Cots dex w ion. to .axq other oompaniet
it portation of oil wes presently in thecb- and d l" ?er?ent co aanies
,,Most of : which were US and UK cmmed -and. tanke ?s? $e a A&,
by the Indian Government representative who reeved hJ. that India to
nth the company to supply vi,7:, to ;I~id Ambassador 's informed
nationalized oil c parr with syr t3 and, would ? ke some range
.Oii JOY. the Iranian Aiiw,
$.., ~ ha.e not been able. to sell
the oil from her nationalized cr n strye The rent Iranian invites
:ran TO reopen negotiations indicates that. the Iraans have become
aware of the gravity of the oil deadlock and the co=ovdta t loss cf
reveme to Iran% The ,t mbassadgi4s st* men? hovttrer, suggest that
I.on to the UK to send a Oo Ment representative the. oil co paap r
the oil itself.
Oran base not given up hope of 'm aging the oil industry and marketing
antipathy to the Briti E with whom his father vas friendly,, At the
time, that Tallal was sent to ape for' treatment of, his mental afflic?
tioa , many people throughout the Arab ?ld felt that s not me
w
T , is known to have disliked his `ather, .and to have ended tit
utilized as a rallying point for the forces o .oh host e to the
7.tish. and ' the late King NT: Prime
in Switzerland and may be attempting to return, .tai Jordano The,T rkLsh
Press has been quoted as announcing that Tall l ,has passed throw
Istanbul It is generally feared text his. arrival in Jordan at this
point would precipitate a serious inter crisis as his. .e is beim,
re ., n r nee 7hlUl sappea,re rod the sani.tori m
tally unbaLanoed but. had been removed beau of his. anti-British
sentimearat o The Iranian Minister of Oour claims . thet. the stork. is
that are a2 tJ.-Israaeii and anti 'British mid opposed to the c ?eation of
sent rents would make Tallal.populazx : ..th gx^oups ; . and out of Jordan
.
The combination of his., self-6iYa t, t.e ;ahd' his anti.'British
preened the view that Tallal is the rSght l '.suooessor.'.to the Barone*
do $rit ish bidding, The Syria, Irime 1inister has ar^a dv.' ems:''
a u c+n between Iraq and .T rd
Aircraft due 1' lied *cause stocks of
~a va.a v.E v a ~rx~c~a~~ zap eta E3 ,t isle''ykt 77e t' Env B Cen nas `G empo
11Y refused refueling facil.it.e~ t m*scheduled carriers as well as
to scheduled carriers which have. nest medntaiiied rye. ar service throu
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achieve a peace?
HBw -INI 0 Attitude Tvww.d Korean Truce Ne ti. Lions. Cessation of haste
es re rather- than the p cip invo~ real seems to be the .major
concern cif .the light Indian press convent appearing to date on the Korean
truce tal m4 According to press co a atai s$ ~ tthe hostilities themselves
resulted from US and Soviet power rivalries-0- Virtually no mention has
been made of C n nest aggression or of UN collective actione The US
nnbas y . in New Delhi states that a clears o erwhe]ming UN victory in Korea
a? might have influenced Indian public opinion to lineup with the UI and to
refer to it as a world organization instead of as an Anglo-American payer
ihstra ,,. The locally regarded stalemate Korea and UN meddling in
&dunir, ho ver, have not increased UN prestige in India, The Embassy
feels that the majority of Indian opinion will . continue to; follow Prime
Minister Nehru inn. advocating avoidance of involvement in a "power strug-
g & and will. urge concessions by the UN and US if they be necessary to
official B, ese Government statement docla'ea that pc a of Mi .N'e
Wings . resignation have no f dati?m0 US baaay Rangoon comments that
ther4 is iooreasing avidenaa that No Win inters to r4am. to . his poet.
avA that tension between the general and the Boccialiete 'continuoa abated0
s Until the struggle between No Win..
the Socialists is resso ved, the of'fioienoy of Bwxavs military estabp
to .lent will ?ont a to deteriorate a the threat of violence between
the t f actione will remain present,
star is rc i visiting "IM and Ear
del and Kar
***king a settlement of the Kai
heir prcb~lo
that the Barmess are increasingly con
ed
se~rioausly weakens B a? s position vib-a-vis
also speculates that the Foreign Minister vi
peace treaty and a iendahip pact with Pa
The Ramses Forei
a- ; to offer assistance in
US may Rangoon believes
Comm iat China, The 'abaeg7'
has to discuss the Japanese
tam,*
SOP SNP
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over the Kashmir impasse which
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alist oooperationiq but-urgently request that delivery of 'some "hard goods
be expedited to convince the Nationalists that e' ?eally mean business"
at a combined staff level4 The probable data of the reorganization is-10
October 195le US officials are reportedly well pleases with Chinese Nation-
NBa Deaf ~' Jill n gs o~ u a axs se
The Chinese Nationalist Armed Forces are not9 at this timed an-effective
modern fighting force,a according to a late May report of Genera`, Chase9
Chief of the US Military Aid and Advisory Group to Formo?aa0; Observing-that
the present strength9 training and equipment are probably sufficient-for a
successful defense of Formosa against the "present prospective ene l Chase
states that they are without sufficient petrolo ia, spare parts, ammunition.,
traaansportation9 artillery, supply of all classes or replacement personnel
for more than, a few days of all-out combat. Joint plan ag and, coordination
is reported as weak or non-existent, The presence of a 0?higk objectionable
system of political officers throughout the armed forces is cited as a force
which penalizes initiative and u .eer aaines military commanders' authori` `
all levels. A lack of real leadership is singled out by General Chase as ihs'
most serious deficiency in the Naationalista? military establishment. This
is reportedly being allsTiaated to some m et t by tae gradual rise of younger
more able leaaelers, many of them American traineedo The General, estimates that
the Nationalist forces, 0 With full support of a ' vigorous programs of American
training and equipment could possibly become combat effecctive in a minimum
of six to eight months after full impZle R,eentation of our aid programal
aBa Chinese Nto. t 90 xaso511d~t~- Arta l~aa~ es0 The Chief of the
Chinese Nationalist Supreme Staffs after a. series of coaafOrenoes with the
American Military Aid and Advisory Group (MAAG) has directed that the present
10 armies composed of 30 I~wea divisions be compressed into 10 armies of :1
divisions (98000 a ach9 ply
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00CFM The
Chinese Nationalist Ministry of National Def s e ordered the conscription
of 15,000 men by 31 Aug to This is Formosan's first military conscription
since the defeat of Japan in 1945e 19000 of theoonsccri~ts will be trained
to drive military vehicleso
ecription at this time may reflect ,thee Nationalists anticipation
creased US aid. Recent reports from US officoiaal on Formosa tell of Chinos
plans to compress the armed forces in a US c cooma ended reorganisation dem
ssa Though not specified this
signed to increase t hair combat effectifene
been recited. previousl
conscription may include native Formosans who have on a limited scale, for essentially non-coffiha?t aece
duties'
about 5 q are now being prepared by the Chinese under . US MAAr pert/ aio
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~neoes arm t cj ) 0 Plans for implementing
this reeorganization9 which is expected to increase combat effectiveness by
ya
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ae CM A Ga mm+i a+- l ` dhn ~~a omi,se on ,Wf t rei
lim2, After mss demands in Common il.st propaganda for the
withdrawal of foreign troops from ' Korea, 'Radio Peiping under a Pyong-
yang dateline bro+ ast the following explanation of Communist compro-
mise with the UN refusal to place the issue on.the Kaeeong agend,.a.- "In
Order to arrive at an early armistice agreement so as to fulfill the
initial hopes of the world's peace-loving people.. we agree to the pro-
posal of your sid?aa
The Communist radio in Vienna ingeniously explained the settle-
ment in these terms.- "For the moment the Americans seem to have gained
an advantage belt the Korean and Chinese representatives forced the re-
opening of the discussions by poetponine this question of the withdrawal
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SECTION 3 (10,STEHN)
FRANCE0 French Consider Cutback in Defense Programer The French are
Inc oasing y s' ep ~c a e rLTl Hess o e current ? hearings on
defense burden sharing before NAT04s Financial and Economic Board (FE$)
and believe French defense plans must be cut back or spread over a longer
period. A slow-town would result in curtailing production plans rather
than the cormitments on Indochina,, bases,, or manpower. The French feel
that none of the NATO countries is undertaking an additional defense ef-
fort involving any real risk for its economy; hence France is assuming
a disproportionately large burden. The French still.strongly prefer a
multilateral NATO approach to rearmament planning,, including. the determi-
nation of US assistance; they now consent to continue bilateral talks with
the US only because no arrangements for multilateral discussions have been
made. CO?Jr1rNT: Growing inflationary pressures 25X1
COMiV NT: The Austrian Government has been looking for some way to strike
at tHe Ali'1'1 , whose presence in Austria is unwelcome. As the-W1TU enjoys
the protection of the Soviets it, Will be necessary for the Austrians to
discover the labor organization in some clear-cut violation of law if the
protests are to be effective,,
force a. gross violation of the control agreement, 25X1
officials of the NFTU as. well as of the Soviet controlled USIA plants.
Graf called the confiscation of housing for nonmembers of the occu-patio
in France,, whic the prospective we coalition government is not likely
to control, threaten the fairly ambitious French defense program,, The
last government warned the US that France would be unable to fulfill its 25X1
commitments in Indochina and Western Europe without much fuller cooperation
from all the NATO countrie s o O the US Embassy in 25X1
Paris recently decried the "serious misunderstandings" between the US and
French administrations,, already resulting in a "sharp-deterioration" of the
mutual confidence necessary for obtaining the desired level and effective-
ness of French defense strength.
AUSTt'i,'IA. Soviets "are Confiscating Housing for Non-Occupation Personnel.
toe Interior Secretary Graf has told-----
a Austrian Cabinet at e U R
is currently turning over confiscated apartments and houses in the city of
Moedling to persons not officially connected with the Soviet occupation
element. One villa was vacated for Louis Saillant,, Secretary General of
the World Federation of Trade Unions (WFTU), which moved its headquarters
to Vienna last spring. The Soviets were also seeking residences for other
ITALY. De Gasperils New Cabinet Takes; bath* Premier De Gasperids new
a inet 'was sworn in on J'Ty- o o wa r a ten-day Cabinet crisis. As
previously,, all but the three Republicans, Sforzas, Pacciardi and La ,Maifa,,
are Christian Democrats. In addition 'to the Premiership', De Gasperi' has
taken over,, at least temporarily,, the Ministry of Foreign Affairs from the
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ailing $forza, who is now Minister v thout Portfolio, in charge of relations
with the European Union. Pella remains as Ministor of the Budget, while
Finance Minister Vanoni retains hiss post and becomes interim Treasury
Minister, Attilio Piccioni becomes Vice Premier. Scelba, Interior Minister, 25X1
retains his post. Among ministers not included in the previous Cabinet are:
.... ..... .
Fanfani, Agriculture and Forests, and Rubinacci,_Labor.
SOmXITT: Judging by personnels it appears 25X1
that the policies of the new a i'~ne' ' will' be much the same as those of the '
old one, although Rubinacci, Who is a leader of the Christian Democrat trade
union (CISL), will probably be more favorably disposed toward labor than
was his predecessor. Of the four most prominent Ministers under attack
from both the right and the left wing of the Christian Democratic Party,
only one. Togni, is excluded from the new Cabinet, Left-wing Christian
Democrat Dossetti is reportedly displeased with the post given to his groups
representative, Fanfani, Piccioni, conservative centrist, has long been
rumored to be an eventual successor to De Gaspers.
"B" NETT RLANDS#. Renewed Va or Needed to Combat Negative Attitude toward NATO.
Du c ini.ste o? Defense tg-7r has stated O was y=g an ' has
proposed an operating body of the North Atlantic defense ministers and the
314A commander, meeting at least once every three months and empowered
to.speed up rearmament, Staffs proposal is aimed at assuring greater West
European government participation in NATO decisions as well as a freer
intr.-West European exchange of information than is now the case. Dutch
policy, based on a strong NATO, fears that the European Army concept might
turn into a "third force"a Dutch military leaders amplified Stafes comments
pointing out.. that uncertainty exists over deliveries of US military equip-
ment and that failure to meet agreed programs will upset the Dutch time-
table for defense,, CQfbu,ENTa Staf as ,views reflect 25X1
the widespread feeling that Europe-,m leadersh pTas Fa s to take
on a negative character in the minds of the people,, The decline in Dutch
popular support for?the defense; program, brought about by the serious
morale problem of?thce Dutch Army, probably will be accelerated if US
military aid is considered inadequate. Hiouvevers there is some tendency
in the Netherlands to let the blame be placed on the UD for the Dutch
Governments unwillingness to implement fully its defense policy.
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UNITED KINGDOM# Change in Ambassadors to Mosciiuaa The UK Foreign Office
Ambassador to the Soviet Union, Kelly will leave in September. 25X1
has con 3.rme .that' it vary Gascoigne wi replace Sir. David Kelly as
CO -7NT: There appears to be no political significance 25X1
in the mover (la-sFoigne is a veteran of the British Foreign Service of
over 30 yearsa standing. His varied posts have not included the Soviet
General Juin is replaced, probably by a civilian.
a study of concessions which might be made to the Sultan when Resident
Unione 'Lmnediately following the war he was Minister to Hungary., and from
1946 to February 1951 served as head of the UK Liaison Mission to Japan
with the rank of Ambassadors Gascoigne&s first wife was an American., and
he is regarded as a strong advocate of Anglo-American cooperation.
MOROCCO. French President is said to be' Investigating Re lacement for
Tu'ln. Preszc en urio~s repo e o e exp ,ring e posai- i .ty o
appointing the French Ambassador to Egypt, Maurice Couve de Murville9 as
Resident General of Morocco,, The President also is said to have requested
000 ENT.- The French President can recommend but
does not have the power of appointment. Couve de Murville9 disliked by
the Egyptians., is extremely ambitious and a clever diplomat. He now covets
the soon-to-be--vacant post of chief of -the French delegation to the UN9
and, would not be likely to consider accepting the Residency General in
Morocco. There is no dearth of civilian and military candidates for JuinQs
Moroccan post, General Guillame (now substituting for Juin on SHAPE) and.
General Koenig (Inspector General of Armed Forces for North Africa) are
probably more likely candidates than any of the civilian possibilities
named to date, If the post is retained by the military, there is'little
likelihood that any actual concessions will be made to the Sultan,,
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