CURRENT INTELLIGENCE DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000800300001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 19
• Document Creation Date: December 16, 2016
• Document Release Date: December 22, 2004
• Sequence Number: 1
• Publication Date: March 27, 1952
• Content Type: SUMMARY

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27 March 1952
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OCI No. 5146
Copy No. 2 5 6
CURRENT INTELLIGENCE DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
State Dept. review completed
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 Intel) igencea Comments represent the
immediate views of the Office of Current Intelligences
SECRET
RETURN TO ARCHIVES a RECORDS CENTER 25X1
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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, SECS. 793 AND 794, THE
TRANSMISSION OR REVELATION OF WHICH IN ANY MANNER TO AN
UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
1. Asian attendance at Moscow Economic Conference: The in-
terest w is t se osco'v Economic on Terence olds for
underdeveloped countries is revealed in late reports from
Iran, Burma, and Indonesia.
An influential Iranian delegation, which includes the
son-in-law of Mossadeq and an Iranian of avowedly pro-
American sympathies, reportedly Will attend the conference
with the government's "blessing."
A Burmese delegation composed of both extreme right-
ists and fellow-travelers is on its way to Moscow. Burma's
chief rice trader is a member. During a stop-over in Ran-
goon a spokesman referred to the "foreign trade" mission of
the delegation.
The Indonesian Government rejected a suggestion to
subsidize seven delegates to the conference, and the Indo-
nesian participants will proceed to Moscow on an individual
basis but with governmental encouragement.
2. World Peace Council Executive Committee schedules meeting
in s o: The xecutive Comm ee of t e orl ease ouncil,
l a major Communist international organization, plans to meet
in Oslo on 30 and 31 March, The Norwegian Ministry of
Justice issued visas to delegates from Iron Curtain coun-
tries while the Minister was in England and without con-
sulting the foreign office. The Prime Minister approved
the visas.
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Now, in an apparent effort to rationalize the action,
Norwegians are explaining to British officials, who oppose
the meeting, that they believe the purpose of the meeting
is mainly to stimulate the peace signatures campaign, which
has been a fiasco in Norway, and that they see no sound
reason why the visas should be rescinded since such action
would be more harmful propaganda-wis
that may be passed at the meeting.
Comment: Contrary to the Norwegians' contention that
the W resolutions are of small concern, tonecof the reasons
for the meeting is probably to reamplify
germ-warfare against the United States.
3. Communist women's organization devenopsocampaimncontbehalf-
ze c ren: a omen s n er
eration as sc eduledaConf rence for the Protection of
Children for 12-16 April ountries
may be represented.
Comment: The aim of the Vienna meeting, as indicated
by 16 ear ier national conferences on the same theme as
well as by its agenda, will be to promote the Soviet "peace"
the prolems as
campaign rather than to consider
may be child
One of a
Oresult t of the
permanent body to propagandize for "children's rights."
EASTERN EUROPE
4, Yugoslav collaboration with Western defense plans de-
-
ent: e
t
em
pen en rn r.ieste set
ral West Commander of the
in Belgrade as a vise ene
British Forces in Austria, that there is little likeli-
hood of closer defense collaboration on the part of Yugo-
slavia until the Trieste question ssettled.
thatetheyl
West are
Wwas s told to inform the Italian Command that Tito will
completely mistaken if they are assuming
to ciate in
in order participate
t
e
concessions on Tries
Western defense plans.
Comment: During the recent Lisbon Conference, Premier
de Gasperrl indicated that Italian acceptance of Yugoslav
participation in ern Trieste prrblemndent upon
a satisfactory
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Yugoslav leaders contend that Yugoslavia has no desire
to become involved in Western defense schemes at this time,
and thus take strong exception to De Gasperi's implied threat
of diplomatic blackmail.
6. Czech Foreign Minister scores United States and ali ns_
Czechoslovakia with Soviet policy on Germany: Czech Foreign
Minister Siroky, in a speech characterized by the American
Embassy as the most vicious attack on the United States
yet made by any Czech cabinet officer, blasted the Amer-
ican "war policy" and placed Czechoslovakia squarely behind
the Soviet proposals for a unified Germany. Speaking on
24 March before the National Assembly during discussions
of the Czechoslovak budget, Siroky said that the Soviet
proposals were in full harmony with the interests of the
Czech republic, but he did not mention the rearmament-pro-
vision proposed by Russia.
Comment: Of all the Satellites, Czechoslovakia has
most loudly declared its approval of the recent Soviet de-
parture in German policy. The haste with which it did so
probably reflects the vulnerability inherent in its
traditional strong anti-German attitude.
Siroky's remarks on the German problem amplify Pres-
ident Gottwald's mid-March speeches on the occasion of his
East German visit. In all Czech policy speeches, the re-
armament proviso of the Soviet note, which will be most
di.?'icult to rationalize to the Czech people, has been ig-
nored.
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7. New Rumanian crop collection plan announced: A decree of the
uman an .ounce o finis ers on 18 March outlined quotas for
compulsory deliveries of agricultural products to the state
in 1952? The measure, like that of last year, still favors
collective farms by reducing their quotas 25 percent during
their first year of operation. Agricultural associations
r a 10 will have theprercentquotraseductncreion byunot moresthano20vpercent.
will ha
Provisions were made for local officials to increase
other quotas up to 10 percent, but they will not be able to
decrease the amount of land assessed for compulsory quotas
y
except with the approval of the Council of Ministeostor bye
justifying the changes by transferring
eo le's councils or state farms. 25X1
Comment: The quota system serves the dual purpose of
assuring tie Rumanian regime an increase in agricultural
procurement for next year and also of weakening economically who the "kulaks" andtPvesaand collective faring ms drawn into agri-
cultural coopers
The peasants appear to have no right to contest their
quota assignments. They must either meet their quotas or
lose part of their land. Those who withhold their produce
at collection time may be denounced by informers who, ac-
cording to the American Legation in Bucharest, receive 25
percent of the goods confiscated from recalcitrants they
have turned in.
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New Kashmiri moves toward independence: Establishment.
of Kashmir as an autonomous republic within the Indian Union
was officially advocated on 24 March by the pro-Communist
Finance Minister of Indian-held-Kashmir, in an address before
the winter session of the Kashmiri Legislature. According to
the Minister, the proposed republic would have a president,
a national assembly, and a judiciary.
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Simultaneously, the pro-Tibetan Head Lama of Ladakh sub-
mitted a memorandum to Prime Minister Sheikh Abdullah demanding
autonomy for his province, which lies in eastern Kashmir
adjacent to Tibet. The Indian press, which reported this deve-
lopment, commented that Ladakh might unite with Ti t if pro er
constitutional safeguards were not assured for it.
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Comment: The views expressed above are good indications
that a third factor, in addition to India and Pakistan, has
to be considered in studying the Kashmir situation. Two years
ago Sheikh Abdullah himself was induced by the Indian Govern-
ment to recant a statement of his desire for independence.
Kashmiri speeches on that subject are now fairly common occur-
rences, and the Kashmiris have become a political force to be
reckoned with.
The apparent Ladakhi dissatisfaction with the Abdullah
government, together with indications of increasing Communist
strength in Kashmir, raises some doubts as to even Sheikh
Abdullah's ability to control his domain. Ladakhi pressure,
which would have been negligible prior to the Chinese conquest
of Tibet, now can be exerted with some effect.
NEAR EAST - AFRICA
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gation is a reputable and influential group whose reactions
13. Influential Iranian delegation to attend Moscow Economic
Conference. The real en o the Iranian erc an s Association
A. a i i, told the American Ambassador that he and at least
five other Iranians were planning to attend the Moscow Economic
Conference "with the government's blessing." The group includes
Senator Matin-Daftary, Prime Minister Mossadeq's son-in-law,
and the editor of a prominent pro-government newspaper. One
of the group is a known Communist sympathizer and a former
official in the Soviet-sponsored Azerbaijan Democratic Republic.
The American Ambassador comments that in general the dele-
Comment: Iranian interest in increased Soviet trade is
stimu ate y the drastic reduction in essential imports imposed
by the partial British embargo. The Iranian Government may also
hope that Iranian representation in Moscow, although ostensibly
on a private, non-governmental level, may aid in the satisfactory
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conclusion of the Iraniamo~thset It ranianeSovietltrade},has have
been conducted for many favorable
particularly
fobasis, not reign exchange.
previously been
baon a idly needsbarter
to Iran, which
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WESTERN EUROPE
Yugoslavs pleased by Italian embroilment in Trieste:
The American arge in e gra e reports t at ugos av o i-
ciais are "more than secretly pleased over the latest Trieste
Zone A B which
integrating Zone
mightoservesas aa nd are further any
into
serve
might
Yugoslavian
The diplomatic corps in Belgrade is generally pessi-
mistic over the Trieste issue, according to the Charge.
Some diplomats believe that neither Italy nor Yugoslavia
desires a settlement at this time, each believing that time
is on its side. Foreign representatives from smaller coun-
tries consider that only the vigorous and impartial inter-
vention of the big powers will achieve a settlement or at
least a calmer acceptance of the status quo.
Comment: Evidence that either party is willing to ne-
gotiate in good faith on the basis of a compromise approach
to the Trieste problem is conspicuously lacking. The Yugo-
slavs apparently believe that the Italians will gain nothing
but censure from the West for their present bombastic attempt
to influence Allied policy toward Yugoslavia and Trieste.
16. Estimates on Europe's need of American coal drastically
reduced: T e spec a aar on uropean con pro ems, com-
posed of ministerial-level representatives from OEEC coun-
tries, has just issued new plans which call for extraordinary
production measures to achieve eventual independence of US
coal. The board has set western Europe's 1953 production
target at 499 million tons, or 36 million tons over 1951 pro-
duction. This represents a long step forward compared to
recommendations made last December by a body of OEEC coal ex-
perts, which foresaw an indefinite need for American coal.
According to the board's latest report, Europe will pro-
bably import some 17 million tons of American coal in 1952,
T.
51 I 1953 that figure
9
is to be`reduced to 13 million' ions, an^ may^r+aA
as compared to 25 million tons in 1
a d
be as low as 5
J1.L11iVaao --
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OEEC coal experts estimated tnat
ember
D
I
,
ec
n
Comment:
Europe wimport 28 million tons of American coal in 1952,
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and that in 1956 the need would still be approximately the
same. MSA officials felt that this report represented a
"defeatist" attitude.
In proposing new plans, the OEEC board probably felt
that political considerations called for optimistic over-
tones in its report. The new goals are not likely to be
met, however, since Europe has already imported half of its
scheduled quota of US coal for this year.
Austrian export scheme distorts normal economic devel-
opments American o c a s in Vienna are disturbed by the
potential effects on Austria's economy of a recent Austrian
regulation authorizing the financing of 10 percent of the
country's exports as "ear-marked exchange and clearing trans-
actions." Under this plan, the-high prices to be charged
importers of nonessentials for foreign exchange will be used
to finance foreign price reductions of high-cost Austrian
exports.
Although this export-promotion plan has been approved
by the International Monetary Fund, US observers in Vienna
doubt that the device is an effective substitute for the
programming of imports to conserve foreign exchange. Rather
than providing the exports necessary to finance essential
imports, the arrangement in effect promotes the importation
of "luxury" items. Furthermore, regardless of the benefits
to particular exporters, the "subsidy" contributes. little
to the solution of such basic problems as increasing pro-
ductivity, reducing costs, and expanding normal trade under
a single exchange rate..
Austrian trade and industry representatives, who are
the primary beneficiaries, themselves recognize that the
new regulation is less than ideal. It is a further example,
however, of the tendency of Austrian leaders to prefer stop-
gap measures to real solutions, and to favor "interests"
over the public good,
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19. Limited French-Soviet trade agreement signed: France
has s gned a trade agreement with the USSR involving the
exchange of a limited number of reportedly non-strategic
items. The agreement, concluded at the end of February,
provides for the exchange of Soviet pit props and anthracite
for French textiles and steel of non-strategic quality. The
value the trade is estimated at nearly three million dol-
lars.
Comment: This is the first French-Soviet trade agree-
ment in Postwar period. France had originally hoped
for an agreement covering about thirty-four million dol-
lars worth of trade. The French are believed to be still
in for a Soviet reply to their recent wheat-ship offer
Investigation in Paris of Katyn massacre will be
politics y hazardous: The American Em assy in Paris
reports that the French Government will be confronted
with "rather special" political problems when public
hearings are held in Paris by the American Congressional
committee investigating Soviet responsibility for the 1943
Katyn Forest massacre.
The Communists will charge that this anti-Soviet
activity conducted on French soil by Americans is further
proof that the French Government is a "servile tool"
of the United States. Non-Communist elements, such as
the Gaullists, will demand an explanation of this un-
usual procedure which could easily be misinterpreted.
Comment: Polish witnesses have accused the Russians
of massa some 10,000 Polish officers whose remains
have since been found in the Katyn Forest in Poland.
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French public .opinion, fanned by Communist and Gaul-
list propaganda, has become increasingly critical of
America's "presence" in France.
21. Dutch-British talks on.East-West trade controls at
impasse According to an official o t e Netherlands
n stry of Economic Affairs, the British-Dutch talks
concerning physical and financial controls over East-
West trade are at an impasse, and the problem probably
will be referred to COCOM0
Britain still falls back on its inability to in-
stitute financial controls, although the Dutch state that
their investigations show that almost all shipments of
strategic goods routed through Rotterdam to the Soviet
Orbit are financed in Britain. The Dutch also say that
British Foreign Office officials have admitted that cer-
tain strategic goods purchased in Germany for shipment
to Rumania via Rotterdam were licensed and financed in
Britain after the Netherlands Bank had refused to handle
the transactions.
The Dutch official asserted that his Parliament
would "scoff" at physical controls as long as Western
countries finance and license shipments to the Orbit.
Comment: Britain instituted physical controls over
transs i.pments last November. In order to ease its bal-
ance of payments difficulties and to maintain sterling
as an international currency, Britain probably will not
take any action to restrict the financing of East-West
shipments, Consequently the Dutch are unlikely to impose
physical checks over transshipments since they already have
financial and licensing regulations over strategic exports,
feel strongly that these controls should be exercised by
the originating country, and are unwilling to take action
unless joined by the other western European countries
which are involved in transshipments.
Spanish Cabinet approves personnel shake-up in Min-
h Cabinet on 7 March
istry o .reign airs: The panis
approved several important personnel changes in the For-
eign Ministry. The new Director-General of Foreign Policy
will be Mariano de Iturralde y Orbegozo, now Consul Gen-
eral at Montreal. He replaces Jose Sebastian de Erice y
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O'Shea, who has been named Consul General at Geneva. New
Directors-General of Administration and Consular Affairs
were also named.
The US Embassy in Madrid believes these changes are
part of a general shake-up in the Ministry which has not
been completed.
Comment: There have been rumors for several months
that Foreign Minister Artajo will be replaced. Ambassador
to Washington Lequerica and Admiral Salvador Moreno Fern-
andez have been mentioned as possible successors.
Erice's transfer, announced almost simultaneously
with his appointment to accompany Artajo in April on a
visit to the Near East, might tend to discount rumors that
the Foreign Minister plans to lay the groundwork for treaties
of friendship with the Arab states and negotiate for oil
supplies.
Franco is apparently bringing in a new team for ne-
gotiations with the United States. Iturralde's former
position was Director-General of Commerce and Tariff Policy.
Argentine businessmen free to attend Moscow Economic
Conference: According to an Argentine official broadcast,
the Argentine Ambassador in Moscow told a group of journal-
ists that his government is not hindering in any way the
trip to Moscow by any representative of Argentine industry
or commerce. He added that his country is always ready to
do business with any other and cited in support of this
position Argentina's trade a reements,with Hun r v and
Czechoslovakia.
24. Brazilian President accepts resignations of both
War Minister and Zone ommander: President tulio Vargas
on 26 Marc. accepted t e resignations of both War Minister
Newton Estillac Leal and General Euclides Zenobio da
Costa. The announcement from the presidential press of-
fice said that Vargas had named General Cyro do Espirito
Santo Cardoso, his chief military aide, as the new War
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TOP SECRET
27 March 1952
CIA No. 49594
Copy No, 4b
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
Commonwealth forces decide to retain Tokyo facilities:
The Uo ltlcac~vzser i-'n Z~TYo repots tfia rites Common
wealth Occupation Forces (BCOF) have decided cidedcnoVe to date
ac of the
their facilities in Tokyo following the
peace treaty and not to pay rental for a 90-day period after. The Political Adviser sofhthetAdministrative
coupled with the general unpopularity
Agreement and intense Japanese feeling against the Australians,
bflreAAmerican
could have unfortunate repercussions
mpost-treaty
security arrangements in Japan.
e Japanese tfhorUnist-
that the BCOF negotiate separately with ththe US e
Nations ait
fCommand.from these ,highhandedtetactics. Comment: Since the British Commonwealth forces are part
of the ccupat1on Forces, the peace treaty requires their
withdrawal within 90 days after the treaty comes into effect.
The Commonwealth countries, however,-had expected the Japanese
to continue to furnish facilities gratis for their forces for
the duration of the Korean war. The Japanese are strongly
opposed to the presence of British Commonwealth troops in Japan
in the post-treaty period for other than rest and recreation
purposes.
NEAR EAST-AFRICA
2. Egyptian cabinet will not contest elections unless agree-
ment wit retain reacie :: lane Minister i a is ca inet
has'-de--c-1-6e thaw, in ie absence of an agreement with Britain,
it will not contest the 18 May Egyptian elections and will
resign immediately thereafter. The Egyptian Foreign Minister
TOP SECRET
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has stated, however, that in the event of an agreement,
Hilali will stay in the Alentions and attempt to secure
popular approval. 25X1
Comment: There have been conflicting reports on the
intenEons of the Hilali cabinet in the event the Anglo-
Egyptian negotiations should fail. The weight of the evi-
dence suggests that the government will resign in this eventu-
ality and let the Wafd return to power, although British of-
ficials believe that this apparent readiness to resign may
be a form of blackmail.
TOP SECRET
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