CURRENT INTELLIGENCE DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A001100270001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 18
• Document Creation Date: December 12, 2016
• Document Release Date: June 26, 2002
• Sequence Number: 1
• Publication Date: August 1, 1952
• Content Type: REPORT

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1 August 1952
25X1
OCI No. 6453
Copy No~ 2Pt'
CURRENT INTELLIGENCE DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This digest of significant reports has been prepared primarily
for the internal use of the Central Intelligence Agency. It does
not represent a complete coverage of all current reports re-
ceived. Comments represent the immediate views of the Office
of Current Intelligence.
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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. Soviet trade with Western Europe: The value of the
trade turnover between the USSR and a Western European
countries amounted to well over $535,000,000 in 1951 as
compared with $325,000,000 in 1950, according to prelim-
inary foreign trade statistics from Western sources.
Much of this increase is due to increases in price
rather than volume. For example, the value of British
imports of lumber increased from $29,000,000 to
$35,000,000, while the quantity of lumber imports de-
creased. The value of imports increased by 20 percent,
while volume decreased by more than one third.:
Among countries receiving appreciably larger values
of Soviet goods in 1951 were the United Kingdom, Finland,
Italy, Belgium and France. Most of these countries also
reported an increase in the value of their exports to the
USSR in 1951 as against 1950.
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2. Bulgarian-West German trade negotiations begun: Ne-
gotia ions for a new Bulgarian-West rman trade protocol 25X1X
began on 23 July. it
is anticipated that the agreement will ultimately provide
for approximate) $20,000,000 in trade between the two
countries.
Comment: Bulgarian exports to West Germany during the
past three years have averaged little more than $2,000,000
annually. Imports from Germany reached a total of almost
$4,000,000 during 1950, but"fell to $696,000 in 1951,
having failed to meet its trade agreement commitments for
essential goods, Bulgaria owed $1,006,000 to West Germany
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as of 31 March 1952, an amount in excess of the credit
margin (swing) stipulated in its trade agreement. The
Federal Republic is thus in a favorable negotiating
position, and will probably insist upon deliveries of
essential commodities in order that the debit balance
be reduced.
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SOVIET UNION
3. Pushkin reportedly made Soviet Deputy Foreign
Minis er for German affairs : East rman"Foreign Minister
Dertinger attaches great importance 60 i:tiC appu1ri wwuix G of
former Soviet Ambassador to East Germany Pushkin as Deputy
Foreign Minister in charge of German affairs, previously
the concern of only a minor desk.
Dertinger also sees Pushkin's transfer to Moscow as
eliminating the risk of friction between him and viet
Political Adviser Semenov.
25X1C
I
Comment: It is not confirmed that the German desk
in the :vie Foreign Office has been given increased
importance.
While there was no concrete evidence of friction be-
tween Pushkin and Semenov, it was generally acknowledged
that Semenov, as politina.l adviser, carried more weight
than.the chief of the diplomatic mission.
4. UN study may give propaganda advantage to USSR: The
Secretariat of the UN Economic Comm ssion for Europe is
planning a study of the effect on Western Europe's dollar
gap of increasing East-West trade to the level proposed
at the Moscow Economic Conference. Executive Secretary
Myrdal reportedly accepted the suggestion of a Soviet
member of the Secretariat, who had recently returned from
Moscow, that such a study would facilitate proposed East-
West trade talks in September.
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The American delegate, who warns that this project
might provide highly useful propaganda material for the
USSR will try to discourage Myrdal.
5. East German leaders comment on Soviet foreign policy:
According to East German Deputy Prime Minister Nusc e,
Soviet officials believe they have given enough proof
of their peaceful intentions by not attacking "when the
West was weak," but that "now no one could expect the
USSR to take it lying down when they are mobilizing
against us."
Nuschke does not anticipate a Soviet military action
in Europe this year, but expects action elsewhere. Both
Nuschke and East German Foreign Minister Dertinger expect
East Germany to be completely integrated into the Eastern
bloc. 25X1C
Comment: Neither Nuschke nor Dertinger is a Communist,
and they ay be concerned that their positions may be fur-
ther weakened in the process of Satellization.
6. Sabotage of Bulgarian agricultural effort, reported:
According to reports quoted by the official Yugoslav news
agency, on 17 and 19 July peasants in two north-central
Bulgarian villages set fire to grain destined for delivery
to the state. Militia and armed Communists are guarding
harvested wheat, especially in the vicinity of Sofia, and
non-workers have been forbidden to cross fields.
Comment: Reports of peasant sabotage and resistance
in Bulgaria during 1952 have been relatively few as
compared with the large number of such reports received
during 1951.
7. Bulgarian-Greek border dispute flares again: ..Bulgarian
and Greek patrols engaged in a series of border clashes on
26 and 27 July following the landing of Bulgarian patrol
forces and villagers on an islet in the Evros River along
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the extreme northeast border of Greece. Three Greek gen-
darmes werp killed during the action, following which the
Bulgarians "maintained ambush-with fire and reinforcements."
The Greek Government has called upon the UN Balkan sub-
committee to investigate.
The US Military Attache in Athens expects the Greek
reaction to be stronger than that following a similar
incident during June. Measures to be taken by Greece will
probably reflect the greater sense of security which the
county now fee = as a member of NATO. 25X1
Comment: On 10 June, Bulgaria protested to the UN
Secretariat concerning "Greek provocations" against Evros
(Maritsa) River islands said to form "an integral part
of Bulgaria." According to the Bulgarian note, a herd of
oxen was directed into Bulgarian island territory by
Greek border guards on 20 May. At the same time, Greek
frontier authorities allegedly sent a letter to the
Bulgarian border guards in which they threatened to shoot
Bulgarian citizens-employed on two neighboring islands in
the river.
According to a Reuters dispatch from Athens, Bulgaria
rejected a United Nations suggestion two years ago that a
joint Greek-Bulgarian committee be formed to settle the
islet dispute.
8. Polish shipyard workers defy government orders: Workers
in the yn a and Gdansk s ipyar s were openly boycotting all
25X10 orders to increase output and efficiency during the early
part of 1952, 25X10
F_ I The managements attributed the
25X10 general dissatisfaction to the steadily deteriorating living
conditions and the food shortages. In order to overcome the
shortage of labor and to save the production program from
complete breakdown, discharged enlisted men from the Polish
.N
avy are being forcibly these shipyards.
F
Comment; Since the shipbuilding industry has been
under continuous government pressure to increase production
which is already at capacity, it is likely that the workers
have been irritated at further exhortations to speed up.
The standard of living, which remains low especially during
this stage of the Six Year Plan, and the scarcity of meats
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and other essential foods would also doubtless contribute
to the unrest. The manpower shortage was stressed by
President Bierut in his recent speech to Polish Communist
leaders, and measures such as the recruitment of women
have been initiated to correct the deficiency. It is un-
likely, therefore, that discharged servicemen are being
directed to essential industries.
9. Yugoslavia "accepts with objection" the Western
tripartite economic a note: Yugoslavia has accep ed,
"with objections," the joint note announcing the-continua-
tion of the British-French-American economic assistance
program for 1952-53. Acting Foreign Minister'Mates states
that his government believes it possible to work out a
satisfactory basis for continuing aid.
Privately, the French Ambassador agrees with Ambas-
sador Allen that Belgrade would probably reject further
economic aid rather than accept conditions which it felt
infringed Yugoslav sovereignty. The British Ambassador,
howevex doubts that Yugoslavia would re'ect economic
aid.
Comment: Yugoslav officials object particularly to
outside supervision of Yugoslav financial policy and to
criticism of the long-term capital investment program.
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FAR EAST
10,
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I1. Macao official concerned over border clashes with Chinese
Communists: rood s Amen s to acao rom China nave stopped
comp e -e y,since 26 July following the border clashes between
the Chinese Communist and Portuguese troops, according to
P. J. Lobo, Director of the Economic Bureau in Macao. Rice
stocks, he said, are extremely low and the price of beef
skyrocketed 400 percent on 29 July.
Director Lobo was irritated with the Portuguese military
police, whose "trigger-happy" attitude, he feared might lead
to further clashes
Comment: Director Lobo's statement contradicts earlier
press reports that a trickle of foodstuffs across the Macao-
China border had been resumed.
The Chinese Communists inaugurated stricter controls on
food exports to Macao in mid-June and thereby underscored the
threat of a complete embargo. Macao is almost wholly dependent
on China for its foodstuffs, and by halting food shipments,the
Communists could starve this Portuguese colony.
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25X1 C
12, National Front attempts'to reduce power of Iranian
Army: The National Front report. y plans to purge tie
Iranian civil service and the armed forces, and already
nationalists in the Majlis are calling for a reorganization
,of the security forces. The American Embassy reports that
'both the National Front and the Tudeh are trying to destroy
the solidarity of the armed forces by creating jealousy and
suspicion between junior and senior officers, as well as
between junior officers and American advisers.
Although the arm morale in the 25X1
g y provinces is still high,
the Embassy believes that demoralization created by National Front
tactics will spread to the provinces,
13. West Jordan deputies plan ultimatum to Prime Minister:
F_ 115 o the
20 parliamentary deputies from West Jordan, Arab Palestine,
met secretly in Nablus on 26 July and formed an opposition
bloc to present demands to the Jordanian Prime Minister that
the influence of Palestinian Arabs in the Jordanian Government
be increased and the interests of Arab refugees be protected.
The meeting reportedly was inspired by recent events in
Egypt.
If the demands are not satisfied within 15 days, the
group will attempt to compel the resignation of the Jordanian
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Cabinet or "assist the people in the use of force."
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Comment: There is no indication whether this group is
Communist-inspired. Although there has been no serious
disturbance recently in West Jordan, the Palestinian Arabs
have been discontented with the Jordanian Government. Previous
reports have indicated some Communist activity in the Nablus
district.
14. Egyptian coup generates new tension in Lebanon: Events
in Egypt have stimu a e po t ca ens ons n e anon, accord-
ing to American Minister Minor in Beirut. Opposition elements
have asked Minor to give American financial support to a coup
to overthrow President Khouri's regime. The British and
French legations have been similarly approached.
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Minor believes that despite widespread dissatisfaction,
a coup at the present time would have only limited chance of
success because of the la k of political ties ng the
opposition leaders:
Comment: Previous reports have indicated considerable
discontent with the corruption and nepotism of the Khouri
regime,
A political crisis precipitated in June by anti-Khouri
forces was defeated byfailure of the opposition to united
15, New army leadership in Egypt reportedly plans military
Nagib opeFis to establish a military dictatorship,
25X1C Nagib?s confidants are
'planning to set up committees of civil experts to advise
military headquarters on politics, press relations, and
economic matters,
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25X1 C
25X1C Nagib defers to decisions
over the distribution of the military posts. 25X1
of the inner circle. there will be 25X1C
a minimum of interference in civil affairs for some days while
trouble may occur among Na i ?s 1bX1C:
ady
Comment: There have been previous reports that Nagib is
merely ie`-spokesman for an army clique. He has publicly
stated his intent to support civilian government.
South Africa raises doubt of meeting minimum American
manganese requirement., Two new eve opmen s ave occurs since
the South African statement of June in which officials said they
would consider exporting to the United States the minimum American
requirement of 500,000 tons of manganese per year. There
was, however, no assurance of continuing the rate after 1953.
Now South Africa doubts that such a rate of export can
be achieved even for 1953 because Great Britain has indicated
it needed more manganese than last year and is considering
sending a commission to South Africa to look into the matter.
The local Railway Administration officials have expressed
doubts, moreover, that the railways have the capacity
transport 500,000 tons this year. 25X1
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Comment: For the past six months South Africa has indi-
cated several difficulties in exporting such a quantity of
manganese vitally needed in the steel industry of the United
States. These difficulties are the local desire to conserve
resources, the railway congestion caused by the higher priority
coal shipments, and the increased British requirements. Present
exports to the United States from January through May 1952
showed 77,700 tons, or an average monthly rate of 15,500 tons,
compared to an average monthly rate of 26,000 tons in 1951,
when only 312,000 tons were exported to the United States.
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WESTERN EUROPE
17, French action in WPsi- Karlin ma
.. AA .2 &...,.
n~__3_1
k
na
y provo
e
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encroachment: American o c a s fear that the withdrawal of
ewer"rm n police from the disputed Gesundbrunnen elevated rail-
road station in Berlin on the orders of French officials may
serve to encourage further Soviet harassment, since Soviet
authorities may interpret the move as a sign of Allied weakness.
According to a high French official, the orders were issued
because of East German threats to interrupt elevated train
service between the east and west sectors of the city unless the 25X1
police were removed from the station. It is more important, the
French official states, to preserve the elevated service than to
st the removal of technical a uiDment by the East Germans,
Comment: The Gesundbrunnen railroad station is near the
French oviet intersector border. Soviet authorities maintain
that part of it lies within their sector. The French action to
withdraw the West German police was taken after East German
workers began taking equipment from the station roundhouse on
28 July and a fist fight developed between East and West Berlin
police.
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18.
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20. French Communists implement broad program for popular sup- 25X6
port: Evidence is growing that French-Communist leaders are
attempting to reduce the notable gap between party policy and its
implementation by the reluctant low-level leaders of the party
and the General Labor Confederation. The American Embassy in
Paris surmises that the Communists' continued electoral strength
represents:popular support of the local leadership, which resists
the party's excessively political and violent directives. A 25X1
"Popular Front from below" is being ostentatiously promoted by
the party and its front organizations in an effort to restore
the confidence of to al militants in party leadership.
I L"_
Comment: In mid-June the party's Central Committee empha-
sizedctical retreat by adopting a resolution calling for
the satisfaction of labor's economic demands as well as the
broadest possible mass participation in united action.
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Non-Communist labor leaders in France have long recognized
the CGT's potential for organizing all French labor on a purely
trade-union basis. While tacit labor support for the Pinay
program eliminates the chance for successful exploitation before
fall, a real'threat to the Western defense effort would develop
if the CGT concentrated on economic objectives.
LATIN AMERICA
21, Argentina reportedly halts foreign exchange transactions:
Because--57 the country's critical ore gn exchange s nation, the
Argentine Government has reportedly drafted a decree temporarily
suspending all import licenses and halting all foreign exchange
transactions. While the decree has not been formally promulgated,
foreign business houses in Buenos Aires are said to have been
advised of it and directed to observe it. By 24 July Argentine
dollar reserves were% reportedly down to less than one million
dollars. F
Comment: Argentine foreign exchange reserves have dropped
sharply -ur ng 1952, as imports have considerably exceeded exports.
No other indication of the current level of Argentine dollar
balances is available, indicate that the 25X1
country's sterling balances, which fell to 3 million pounds at
the end of June, may now be practically exhausted.
Argentina's financial distress has also been reflected in
a significant, though not critical, increase in bankruptcies
and unemployment.
22. Chilean President reportedly trying to uncover evidence of
Argentine rater erence in election campaign: rest ent onza ez
'ridela- reportedly has ordered the Servi iC de Investigaciones to
concentrate its efforts on uncovering evidence of Argentine inter-
vention in Chilean affairs, particularly Argentine support of
presidential aspirant Ibanez del Campo. Any such evidence will be
used in a propaganda campaign against Ibanez, whom Gonzalez
Videla now believes to be the strongest contender for the Chilean
presidency.
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Comment: it appears likely that Ibanez has been receiving
support from Argentina, but there has been little definite
information to indicate the nature and extent of such support.
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Last month, however, the Chilean Government declared the
Argentine Consul at Antofagasta persona non grata for dis-
tributing anti-US and pro-Ibanez propaganda. Also, the govern-
ment announced that it had confiscated anti-Chilean literature
favoring Ibanez which had been sent into Santiago by the
Argentine Foreign Office. This information, undoubtedly publi-
cized as part of the campaign against Ibanez, probably consti-
tutes the most positive evidence thus far of direct Argentine
efforts to influence election results in Chile.
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TOP SECRET
TOP SECRET SUPPLEMENT
1 August 1952
CIA No, 49756
Copy No. 46
TO THE CURRENT INTELLIGENCE DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
ThiS digest 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
WESTERN EUROPE
25X1 C
2, East German security measures provoke local resistance:
25X1 Accor ng o o e more an 10,000
persons scheduled or resettlement from border areas, 8,000 had
been evicted by 20 June. Over 4,OOO,in'cluding many not actually
slated for resettlement, had fled the country,
American officials in Germany believe that these figures
probably do not cover developments along the Baltic coast, They
interpret the nigh percentage of refugees from Thuringia as
indicative of the extent of the discontent there,
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25X1 the Evangelical Bishop of Thuringia has violently
protested the eviction measures and has called upon the church
25X1 organization to nel the victims ,I gencya11 25X1
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Comment: A strong undercurrent of predominantly passive
resistance is suggested by the number of refugees and the elaborate
Communist propaganda treatment given East Germany's "democratiza-
tiono" Such resistance could compel the East German Government
to modify, although not abandon its timetable,
3. Paris Embassy comments on Salaries appeal for transport air-
craft, m assn or unn in aria considers unwise -to approach
General Salan for transport+aircraft_necessary yfor=offensive?oper-
ations in Indochina late this year. The Ambassador believes that
such an approach by the United States would immediately cause
the French to bring up the American rejection of transport air-
craft as an item in Defense Minister Pleven's May request for
additional offshore procurement orders.
As an alternative, the Ambassador suggests further explora-
tion of the possibility of supyl-yina American port aircraft
'
to meet Sal
an
s needs,
Comment: Ambassador Heath in Saigon has emphasized the
necessity or taking the initiative away from the Viet Minh by
overcoming the apparent complacency of the French Government over
the holding operation. in Indochina.
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