CURRENT INTELLIGENCE DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000800230001-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 20
• Document Creation Date: December 22, 2016
• Document Release Date: February 24, 2006
• Sequence Number: 1
• Publication Date: May 21, 1999
• Content Type: SUMMARY

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SECRET
18 March 1952
OCI No. 3895
Copy No. 25 6
CURRENT INTELLF.DENCE DIGEST
GI-lie ,j Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This summary of significant reports has been prepared primarilyIt does
for the internal use of the Office of Current s in CIA not represent a complete coverage of all
Comments reprtesent the
or in the Office of Current Intelligence.
immediate views of the Office of Current Intelligence.
DIA, DOS and JCS review(s) completed.
USAF and PACOM review(s) completed.
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THIS MATERIAL CONTAINS INFORMATION AFFECTING TUU. NATIONAL
DEFENSE OF THE UNITED STATES WITHIN THE MEANING OF THE
ESPIONAGE LAWS, TITLE 18, USC2 SECS. 793 AND 704, THE
TRANSMISSION OR REVELATION OF NICE IN ANY MAINE It TO AN
UNAU UOI IZED PERSON IS PROEIBITE L LY LAW.
SOVIET UNION
1. Possible Quiet overflights detected in Norway and Iceland;
aircraft believeu Lu uv a A r- --
the vicinity of Bodoe below Narvik. The radar operator at
Keflavik airport, Iceland, has also reported an unidenti-
fied object over western Iceland flying at an estimated
speed of 250 knots and at an altitude of 8000 feet. These
are tentatively considered as
hts in the arctic region are
rfli
t
ove
g
Comment: Sovie
not new, hor,gh none has been reported in recent months.
Most of those in North Norway have occurred farther north
in the Kirkenes-Hammerfest area, There has been evidence
of Soviet air reconnaissance in the desolate Greenland area;
but the Russian airmen have shunned Iceland, presumably
leaving reconnaissance to the soviet fishing trawlers.
EASTERN EUROPE
training function of Bulgarian youth
ilitar
y
2. Param
session o The
group re-eimp "' 3 : The our p enarY
en ra Committee of the Diriitrov Union of People's Youth
decided that, by the end of 1.952, "each member of the Union
should have become either a holder of the People's Rifle
Shot Badge or a member of the Antiaircraft and Chemical De-
rve
Section," in order to create "aAlargefreseinliorf andl-
trained youths necessary LUi AAt+ .a
for the defense of our country."
Comment: The Dimitrov Union of People's Youth is the
primary Communist youth organization in Bulgaria. In a
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ening of the fourth plenary
keynote address deliveredtaWashstated that a continuingPlr-
session on 11 February, i ate the youth in a Pat
pose of the union
smust pirit eofoirreconcilablehatrr hatred for the
British
in a - the American and
instigators of a new war - the monsters of Belgrade,
ialists and their Balkan tools,
Ankara, and Athens."
Closely associated with thBlastthe VUnion of. oluntaryPOrgan-
Youth is another youth group known
i s
zation for Defense Cooperation, which is known to offer Bu -
arian youth training in such advanced~sppngts" as near sman-
ship, glider piloting, and parachute ju
Efforts made to increase supply of skilled labor in
3. orts to a evi.ate Me acu e s ortage
Hungary: De ermine e few a
p past srci led labor have been noted within fthe or compulsoryproin
Hungary. A decree of 13 March Pr school and technical
fessional practice by university, high s anditech technical
school graduates. The Minister exercising ion o e's
e of decinationalde each
each educational establishment
assignment in a particular sphere
of compulsory practice" is two years for unduates
The "P raduates and 18 months for g
ver sity and high school g
of technical schools. Szabad
A recent editorial in the Budapest Communist daily
criticized the program of apprentice training.
a s
yep severely
migration absenteeism, and of lack of the discipline apprentices, were whereas lack
serious failings on the p
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of equipment, uncooperative managers and lack of organization
q
were blamed on t~upervisors of the program.
trialization under the
d
us
Comment: Hungary's rapid in
ear an has put a serious drainotneavailablesmanpowtr,
Five
particularly sitilled laborro
have failed to solve the problem.
On a recent
4. Military developments observed in Hingitary Attache in
trip rom Budapest to Be gra e ~ 132 mm M-13 rocket launch-
ers observed three Soviet-tyPe of Orkeny, confirming a
ers on the highway in the vicinity
previous report based on observation of trucks with tarpaulin
covering suspected launchers.
covering
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aclKs. some apparently
He also observed severer %fnSZeged*
t
y
unoccu ied in the vicini
o e
o
s
Comment: Confirmation of
further
is
evidence aunt ers by Hungarian
~..ocls:e troops
of the continuing Sovietization of the 'Flungarian Army.
Extensive barracks construction has paralleled ex-
pansion of the Hungarian myear. which The has e more existence than of new doubled
in strength during the past
torsummerrfieldltraining winter
barracks, unoccupied when out most
garrisons prior to moving y may
areas, suggests that further expansion of the arm
be contemplated.
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rl nt action called for in recent JCP policy directives.
Japanese Communists employaggressive tactics in Tokyo
by-elec ion: Tokyo by-election on 12 March to i two
vacant seats in the National Diet was characterized by
several disorderly Communist demonstrations and attacks upon
the police. These incidents, according to CINCFE, indicate
that even in legitimate political activities the Japanese
Communist Party is following the pattern of aggressive and
Comment: Although Communist attacks upon the police
have been on the increase since the first of the year, it is
noted that several Communist anniversaries in early March
passed without incident. This suggests that the JCP is
avoiding direct large-scale clashes with the police, and is
concentrating upon isolated acts of violence and intimida-
tion in order to weaken police morale and resistance.
6. Ryukyuans will lose favored position in Japanese sugar
trade: member of the Ryukyus Board of Trade delegation in
o yo reported, on his arrival on Okinawa on 23 February,
that despite negotiations with the Japanese Government the
Ryukyuans will lose their favored position on the Japanese
sugar market. The delegate expects the price of sugar in
Japan will fall approximately 30 percent.
CINCFE comments that the logs of this favored position
will seriously handicap efforts now being expended to revive
the Ryukyuan sugar industry to its prewar position in the
insular economy.
Comment: Prior to World War II Japan encouraged the
Ryukyuans to make the sale of sugar to Japan their principal
cash crop, despite the food deficit nature of the economy.
7. Japanese-Soviet telecommunications dispute is settled:
The Soviet Government in an unexpected move on March agreed
to settle for 10,000 gold francs a dispute of four years
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. VW
duration with respect to outstanding debts for telecommuni-
cations services between Japan and the Soviet Union. The
t the es should be
d th
a
USSR had previously contende
naid by Japan as an occupation cost.
9. Rhee believes he can influence course of armistice 1111
11 negotiations in Korea: President ee, in an in erview with
American Ambassador uccio, indicated that he derived "con-
siderable satisfaction" from an Associated Press story stating
that several leading UN delegates are worried at Rhee's inflex-
ible attitude against the cease-fire negotiations and its
adverse effects on the talks. This story, according to Muccio,
has apparently confirmed the president's belief that he can
influence the armistice, and will probably encourage him to
remain adamant.
Turning to internal affairs, Rhee said that the situation
was well under. control and that there would be no trouble.
Muccio disagreed, however, and pointed out that, the present
"political rumpus" worked to spur on the tremendous inflation-
ary upsurge, while both externally and internally the politi-
cal situation in the ROK has caused a great deal of speculation
as to just what kind of government exists in South Korea. The
interview ended as Rhee changed the subject and began to
reminisce.
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w
Chinese harass British business interests: British
interests in Sh al ace a crisis following the arrest last
week of a leading British firm's principal repressentative.of
His detention reportedly was for failure to pay
an affiliate whose business has been paralyzed by the anti-
corruption campaign.
Officials of the British American Tobacco Company are
now expecting the arrest of their Shanghai manager for failure
to meet extortionate demands. The company has already written
off its 25 million dollar China investment and has declared
that it will not remit additional funds regardless of repri-
sals which may be taken against its 20 executives remaining in
China.
At a meeting in Hong Kong, officials of British firms
agreed to recommend "to London" not to yield to extortionate
Chinese demands regardl ences to British execu-
tives caught in China.
Comment: There is a general conviction among the British
that eir China investments must be abandoned. However, they
are still anxious to maintain trade relations with the Communists,
subject to export restrictions on the more strategic commodities.
China is Hong Kong's principal customer, and British-flag ships
outnumber those of any other foreign registry in the China trade.
d b sed on Yalu River fields: Aerial
a
l
and 144 MIGs at Antung.
ieve
280 jets be
photographs of arc s ow s on a atungkou airfield
Comment: The apparent absence of aircraft at Antung and
Tatung ou, as reported on two occasions in late February by
visual reconnaissance, has led to speculation about the use of
other fields deeper in Manchuria as combat bases. The present
unreliability of visual observations may be related to the
recent appearance over Korea of camouflaged MIG-15's.
Takushan.
The Far East Air Force comments that this invalidation
of observation renders suspect earlier reports based on sightings
that no aircraft were at these two fields. FEAF's current
estimate of aircraft based in the lower Yalu River area is
100 MIG-15'c .,+ oa'h of these fields and 80 more at nearby
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12. Situation in Bangkok still unsettled: After reviewing
the various reports o impending po i ical unrest in Thailand,
the American Embassy in Bangkok reports that the situation is
d"
li
"
"
ne
inc
It is
"more than ordinarily unsteady and murky.
to believe, however, that Premier Phibun is threatening to
resign at a strategic moment in order to mobilize widespread
support for himself by playing upon the fears that he is all
that stands between a Sarit-Phao conflict followed by intgn-
sified corruption and terrorism.
Banda, although it will undoubtedly be used as suc .
t
to involve more deeply any power which may be aiding e
Nationalists. The Embassy also states that there is no
suggestion that the story is a product of Communist pro-
pa-Nationalist plan to invade Yunnan from Burma. reported:
On Myint, the Burmese news reporter w a has been writing a
series of stories on the Chinese Nationalists in northeastern
Burma, stated in his 15 March column that the Nationalists
intend to commence a new offensive against Yunnan in mid-
April. The American Embassy in Rangoon comments that this
story, obtained from a Nationalist officer, may be designed
h
Comment: There have been several predictions that the
Nationalists would make another attempt to invade Yunnan since
their unsuccessful attempt of last summer, but there has been
no reliable evidence that they are either willing or able to
undertake such an operation in the near future.
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SOUTH ASIA
16. New Soviet-Afghan trade agreement is signed: The Ameri-
can Em-bossy n a u has been re is y informed that the Afghan
Government's automobile, petrol, and sugar monopoly has re-
cently signed a new one-year contract in line with the Soviet-
Afghan trade agreement of July 1950 for the purchase with
dollars of three million gallons of gasoline, 150 Pobeda
cars, and 150 trucks of unidentified make. Prices reportedly
are 65-dollars per metric ton for gasoline delivered to the
Afghan border, and 800 and 1,200 dollars respectively for
cars and trucks delivered in Kabul. The Embassy comments
that these prices are considerably cheaper than those obtain-
able elsewhere.
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V%Of
Comment: A previous barter contractfor three million
gallons of gasoline, which approximates total annual Afghan
consumption of this commodity, was made at a time when
Pakistan was delaying the transshipment of oil products deli-
vered at Karachi and when the Afghan Government feared for the
stability of its national economy. The contract was less than
half fulfilled because of Afghan inability to store or trans-
port gasoline delivered by the USSR, because Afghanistan had
difficulty in shipping commodities of equal value to the
Soviet Union, and because a satisfactory flow of oil was
eventually obtained via Karachi.
Despite a report that the Russians have completed
installation of oil storage facilities in northern Afghanistan,
bringing total capacity there to 300,000 gallons, it seems
unlikely that the new contract will be more successfully ful-
filled than was the previous one.
NEAR EAST - AFRICA
17. Turkey refuses to attend Pakistani-sponsored Moslem con-
ference: The Turkish oreign ce has n orme e a istani
Charge -in Ankara that the Turkish Government would not parti-
cipate in a conference of Islamic states which is being
sponsored by the Pakistani Government. The Turkish Foreign
Minister reported that as a result of Turkey's non-acceptance,
Afghanistan would also probably decline the invitation. Ile
added that the Lebanese Government terized the
Pakistani proposals as "Utopia."
Comment: Zafrullah, Pakistani Foreign Minister, dis-
cussed t e idea of periodic consultations on questions of
mutual interest during his recent tour of the Middle East.
Turkey's refusal to attend the Islamic conference under-
scores its determination not to engage in regional politics
based on the Moslem religion. The Turkish attitude may
seriously reduce the effectiveness of the conference.
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WESTERN EUROPE
18. Crisis in West Berlin government worsens: Further com-
plica loos have eve ope in the curren crisis facing the
coalition government of West Berlin. An announcement by the
Free Democrats recommending the discontinuance of social in-
surance, byitheilatterras ay"deathblow tomtheacoalition."
attacked by
Local HICOG observers state that, in view of the height-
ened tensions, it is "problematical" whether the three coali-
tion parties will be able to reach a reement,'on this and other
points of difference.
Comment: This crisis, which originally arose over a
squabble involving the local police, has spread in the past
i
several weeks to a number of other issues. Social Democrati
c
Mayor Reuter had originally believed, prior
surance matter, that he could arrive ata settlement by the
20 March deadline set by the local legislature. If a new gov-
ernment is formed, it would probably leave
beo a tpRoeter uAllieddgrthe
oup-
Social Democrats, but would nevertheless
ing.
19. French tend to discount present Russian threat to western
Europe: T e ssistant rector o o itica airs in t o
renc Foreign Ministry speculates that the recent Russian note
on German unity may reflect a Soviet decision to abandon any
immediate design of military aggression in western Europe. He
believes that the tempo of Western rearmament may have tempo-
rarily discouraged the Russians, particularly since they feel
25X1
that in any event time is on their side.
Comment: While the Foreign Office has no illusions on ulti-
mate Soviet aims, speculation of this sort appeals to a majority
of Frenchmen in view of the country's critical financial situa-
tion. Consequently, there is real danger that responsible French
officials may agree with the Belgian Premier, who recently stated
that "nobody believes western Europe is now in danger of Soviet 25X1
military agression."
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21. Pro-Italian extremists threaten disorders in Trieste:
Police aut orities in r este have warne that "the most ser-
ious threat to public order for the past three years" will
occur on 20 March, the date set by pro-Italian elements for
demonstrations marking the anniversary of the 1948 tripartite
declaration advocating the return of the entire Free Territory
to Italy.
There are indications that the neo-Fascist Italian Social
Movement will try to whip up anti-Yugoslav efeeling gfandeprovoke
incidents serious enough
on the Trieste problem."
Comment: These planned demonstrations are not likely to
get ou band. The Italian Government hopes unofficially
that they will nce world powersilure
to settle the Trieste
The activities of the local Italian Social Movement re-
flect the growing aggressiveness of this ,party in Italy.
22. Military procurement program will not fully utilize
Italy s in ustrial capacity: Orders placed by the talian
Government for military materiel will use only a minor portion
of the productive capacity of Italian industry.and other wes-
tern European countries are not likely to place orders in
significant__amounts. The American program for military pur-
chases in Italy has so far only a slight impact on the coun-
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try's economy, and even when fully under way it will leave
idle large segments of Italian industry. At present, Italy
is reasonably assured of 60 million dollars worth. of US
military orders.
This situation, combined with the recession in the chemi-
cal, textile, shoe, and other consumer industries, the growing
disparity between wages and prices, and the relatively large
number of unemployed, is causing labor unrest and increasing
criticism of the government's cautious economic policy. In-
fluential elements of the Italian economy, led by the indus-
trialists, feel that because Italy is accumulating large re-
serves and pursuing conservative economic policies, it is not
getting a fair share of American aid. Part of its reserves,
accumulated through EPU, represent flights of capital, and do
not indicate any real improvement in Italy's position.
Some progress has been made in improving Italy's economic
situation: agricultural production has kept pace with the growth
of the population, and industrial production has increased sig-
blems -- im
nificantly. Nevertheless, the basic economic pro
tion of
tiliz
a
balance between population and resources, under-u
the land, and obsolescent industrial and agricultural produc-
tion facilities -- remain and can be solved only through ulti-
mnt western European economic integration.
23. Swiss take neutral stand toward Moscow Economic Conference:
Foreign nister Petitpierre has announce-d--that the wiss ov-
" businessmen
ernment will "neither encourage nor discourage
wishing to participate in the Moscow Economic Conference. He
also reported that the government had not received an invita-
been informed offi-
tion to participate in the conference nor
cially of the object or scope of the conference.
Comment: There is no available information as to whether
any Swiss usinessmen will take part in this conference. Their
government will presumably encourage a few Swiss to attend as
observers.
24. Death sentences against Spanish anarchists carried out:
The Amer can Consul in-Barcelona has reported that five o the
nine anarchists recently sentenced to death by a Spanish court-
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martial were executed on 14 March. This information was later
confirmed by the Madrid press, which stated that Franco had
commuted the sentences of the other four to life. No mention
was made of the political affiliation of the nine"gangsters."
Comment: This group belonged to an apolitical faction of
the clandestine anarchist labor organization,,Confederaction
Nacional del Trabjo. The charges against them were of a crimi-
nal nature and included murder, but the holding of the trial
in a military court and the severity of the penalties lend a
strong political hue to the case.
This case is totally unrelated to another one involving
27 members of the Catalan Communist party, Partido Socialista
Unificado de Catalunya, which was the subject of a Polish reso-
lution in the UN. In the past'such executions have frequently
set off violent reactions, but the improvement during the past
year in economic conditions in Barcelona makes popular disorder
unlikely at this time.
25. British Labor Party still uncommitted on British participa-
tion in European army: British Labor Party headquarters have
informed the Embassy in London that the delegation meeting
with representatives of the French Socialist Party in Paris on
22 March will be instructed simply to listen and report back.
The Embassy believes that the pressure of other developments
has prevented the Labor Party from formulating an official po-
participation in the European army.
Comment: A committee of the Parliamentary Labor Party
voted last week against a resolution favoring British partici-
pation in the European army. The American Embassy does not
consider this vote an adequate test of sentiment in the party
as a whole, which not, only still fears the prospect of a rearmed
Germany without adequate guarantees against nationalism, but is
also distracted by internal'disputes on the size of the current
British rearmament program
26. More Britons considering attendance at Moscow Economic
Conference: The British Foreign Office has informed the American
Embassy London that, despite official discouragement, at
least 27 Britons are now considering attending the Moscow Eco-
nomic Conference. The list includes three Members of Parlia-
ment, two university professors, a group of Quakers, and two
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oup
embers of the World Federalist gr, including Lord John
m
Boyd-Orr.
s t
. sparate invitation s Brt1th e1Foreignaofficestatest
tances, but l? g
roup of American
has had no accep
M has
it t has heard rumors that an 1mP ress ive
it Moscow at the same time as the
businessmen intends to vi'
economic conference.
t shows that Comment Although this repordmore oes not tins
are in eras ed in attending the conference,ti attend.
dicate that all these people plan actually fore With regard to the trade conto bus'Moscow been the
general economic meeting, invitations
issued through the International Chamber to announce that f 'Co mercer?mOine of
the promotion techniques has been accepted.
industrialists from other countries have already
28.
LATIN AMERICA
Hungarian Chamber of commerce trying to romote sales in
resumes y o a circa ar ype, as
Cuba. commun cation, P a m sed to the Cuban Ministry of Commerce by the Hungarian
the commodities and products
mmastry organizations.
of export by P
by enumerating State trading nnThe eer cirircula ular urges The the dissemination of this information and
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ith the State
and w
to corresp throe h the
invites prospective customers alternative)
trading organizations Cdo mercey or,
Hungarian Chamber of representative of
Comment: Early in 1951 Istvan Brody, tried unsuccivfi my in
na ized industries in Hungary, The only
the na ? goods in the Cuban market Jose Schachter in
handling Satellite goods is obtained
Cuba to sell Hungarian g Iles reportedly
known to be Cuban business firms
Havana which seTradeZMis ion motor-bicycles
New moath
are expected y toward present
from thezech
to show little or no sY p
Hungarian overtures.
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TOP SECRET
18 March 1952
CIA No. 49577
Copy No. 4
TOP SECRET SUPPLEMENT
TO THE CURRENT INTELLIGENCE DIGEST
Not for dissemination outside O/CI and O/NE.
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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. Comments represent the
immediate views of the Office of Current Intelligence.
TOP SECRET
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TOP SECRET
THIS MATERIAL CONTAINS INFORMATION AFFECTING THE NATIONAL
DEFENSE OF THE UNITED STATES WITHIN THE MEANING OF THE
ESPIONAGE LAWS, TITLE 18, USC, SECS. 793 AND 794, THE
TRANSMISSION OR REVELATION OF WHICH IN ANY MANNER TO AN
UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
FAR EAST
1. UN forces may sojourn in Japan,after. peace treaty becomes
effect yes a spanese vernmen as presented e
. Political Adviser in Tokyo with the draft of an agreement be-
tween Japan and the UN governments participating in the Korean
war, which provides for the continued use of Japanese rest
hotels and facilities by UN forces for the duration of the war.
The agreement states, however,that Japan will not share any
expense incidental to theLpresence +off gUNnfdoraresas utilized.
le 5 of the Japanese Peace Treaty,
ti
c
Comment: Under Ar
Japan accepted an obligation "to give the UN every assistance
in any action it takes in accordance with the Charter."
2. SCAP modifies directive prohibiting arms production in
Japan: A oes no con emp ate.aut 8tiz ng apan o manu-
ac ure arms and munitions prior to the effective date of the
peace treaty, despite 15 March Japanese press stories to the
effect that such production can now be undertaken with SCAP ap-
proval. The US Political Adviser in Tokyo reports that SCAP?s
recent amendment of the original directive which prohibits
munitions production was necessary in order not to preclude
Japanese arms production in the post-treaty period. He points
out that the Japanese intend to extend this randdg ottherw ccuppaation-
directed ordinances into the post-treaty period, and we eo
itiat`
i
n
luctant to sponsor on their own
s
iti
.
on
authorize the production of mun
of the words "without SCAP ap-
iti
on
Comment: The add
provaShe original directive prohibiting the manufacture
of arms aid munitions undoubtedly will bring forth additional
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Communist charges of US-Japan warlike intentions.
Plant studies by CINCFE indicate that'the Japanese are
immediately capable of producing a wide range of armaments, in-
cluding 4.2 inch mortars, 105mm howitzers, 75mm recoilless
rifles, personnel and anti-tank mines, and necessary ammunition.
Certain Japanese munitions production in support of the Korean
war, now under American control and direction, probably will be
transferred to the Japanese when the peace treaty becomes ef-
fective.
3. F.,itur.e Japanese export controls under discussion. The US
delegation to CO - an n orma c?o ana ng comet ttee for
Western export controls -- reports from Paris that Japanese
entry into the organization would involve significant operating
disadvantages posed by distance and time, and might give certain
participating countries an opening to reduce existing controls
or to reopen controversial questions already settled. The dele-
gation thinks that Japan might join the opposition within COCOM
rather than supporting the United States and raises a question
whether current COCOM controls, which are oriented toward the
Soviet Eurona?nrti t,i oc, would be suitable for Japan,
Comment: The United States believes that Japanese member-
ship n3M would prejudice steps toward closer COCOM/NATO
relationships, Recognizing that the Japanese Government will
be under pressure to relax its strict SCAP-imposed controls
when the peace treaty becomes effective, the United States has
proposed an immediate non-000OM multilateral conference with
Japan -- a step which Britain opposes on the grounds that (1)
the matter should be discussed within COCOM first; and (2) it
would appear that Japan was being pressured while still under
occupation.
TOP SECRET
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