COMMUNIST CHINA'S IMPORTS AND EXPORTS, 1955: TRADE AND TRANSPORT INVOLVED (EIC-R1-S5)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00400R000200070005-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 87
• Document Creation Date: December 19, 2016
• Document Release Date: August 11, 2006
• Sequence Number: 5
• Publication Date: September 6, 1956
• Content Type: REPORT

Approved For Release 2006/0811 CI DP82-00400R000200070005-2
IAC-D-42/ 12. 3
6 September 1956
I N T E L L I G E N C E A D V I S O R Y C O M M I T T E E
Communist China's Imports and Exports, 1955:
Trade and Transport Involved
(EIC-RI-S5)
1. The attached report, subject as above, has been received
from the Chairman of the EIC in accordance with paragraph C, 2 of
his letter to the IAC of 19 March 1956 (IAC-D-42/12, 20 March 1956).
This paper is now submitted for IAG approval, following approval by
the EIC,
Secretary
MORKIDIF
25X1
25X1
SECRET
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
S-E-C-R-E-T
COMMUNIST CHINA'S IMPORTS AND.EXPORTS, 1955'.
TRADE AND TRANSPORT INVOLVED
(EIC-Rl-S5)
Approved by EIC Working Group
29 August 1956
Approved by Economic Intelligence Committee
6 September 1956
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 25X1 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table of Contents
I. Suanmary of Major Developments During 1955
II. Over-all Values of Trade .. . . . . . . .... . . 6
A. Communist China's Total Trade .. . . . . 6
1. The Level and Direction of Trade . . . 6
2. The Balance of Trade . . . . . . . . 7
.Trade with Bloc Countries . . < . . . . . . 8
1. Trade with the USSR . . . . . .. . ?. 8
2. Trade with the European Satellites .. 9
3. Trade with Far Eastern Satellites. . 9
Trade with Non-Bloc Countries . . . . . . 10
1. General . . . . . . . . .. . . . . 10
2. Imports . . . . . . . . . . . . . . . . 10
a. Recorded Imports , .
b. Unrecorded Imports . . . .
3. Exports . . .
10
15
.. 18
a. Recorded Exports . .. . . . . .
b. Unrecorded Exports . . . .
18
20
III. Value and Volume of Principal.Trade Movements 25
,A. Total Chinese Communist Trade . . . . 25
1. Introduction
2, Total Imports
3. Total Exports
25
25
25
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
8-E-C-R-E-T
Table of Contents
(continued)
Page
B. Trade with Non-Bloc Countries . . . . . . . . 28
1. Imports . . . . . . . . . . 28
2. Exports . . . . . . . . .
C. Trade with the Soviet Bloc
1. Trade with the USSR . . . . . . . . . . 32
a. Imports from the USSR . . . . . . . 32
b. Exports to the USSR . . . . . . . 31j.
2. Trade with the European Satellites . 36
a. Total Trade . . . . . 36
b. Imports . . . . . . . . . . . 37
c. Exports . . . . . . . . .. . . 38
3? Trade with the Far Eastern Satellites . .o
a. Trade with North Korea . . . . . 1+0
b. Trade with North Vietnam . . . 1+(7
C. Trade with Mongolia .. . . . . . 41
TV. Transport and Transport Services . . . . . . . . 42
A. Ocean Shipping
42
1. Summary . . . . . . 1+2
2. Non-Bloc Shipping Review . . . . . . .11.4
a. Arrivals . . . o . . . . . i44
b. Departures . . . . . . . . . . 46
3. Bloc Shipping Review . . . . . . . . 47
a. Arrivals . . . .
b. Departures . . . . . 48
C. Routes Employed .. . . . . . . . 48
4. Utilization of Capacity of Shipping Engaged
in Communist China's Seaborne Trade . . 50
S-E?~C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00 -
S-E-C-R-E-T
Table of Contents
(Continued)
Page
Assistance to the Sino-Soviet Bloc by
Non.-Bloc Shipping and Shipping ,Services . . . 52
1. Significance of Non-Bloc Shipping :in
the China Trade . . . . . . . . 52
2. Bunkering . . . . . . . . . . . .. . ? . . 54
3. Non-Bloc Deliveries of Merchant Ships to
the Sino-Soviet Bloc . . . . . . . . 55
4. Non-Bloc Repairs to Soviet Bloc Vessels . . 56
C. Interior Transport Connections .fox Communist
China's Foreign Trade . . . . . . . . . . . . 60
1. Interior Transport Connections Utilized
During 1955 . . . .. . . . . . . . . . 60
2. Significant Developments During 1955 and
Early 1956 . . . . . . .. . . 60
a. Railroads . . . . . . . . . . .. . . 6o
b. Roads . . . . . . . . . . . . . 62
c. Inland waterway . . . . .. . . . . . . . 62
d. Air . . . . . . . ... . . . . . . . . . 62
Appendix
A. The Value and Direction of'Trade . . . . . . . . 63
B. The Composition of Communist China's
Imports, 1953-55 . . . . . . . . . . ... . . . 66
C. Communist China's Exports . . . . . . . . 6$
.S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
Tables.
Page
1.
Ocean Cargoes Arriving at or Departing from Communist
Chinese Ports
Summary of Communist China's Estimated Imports, 1955
2
3.
k.
Summary of Communist China,'s Estimated Exports,. 1955
Recapitulation of Estimated Value and Distribution'of
3
'Communist China's Foreign Trade, 1954 and 1955
7
5.
Estimated Balances of Chinese Imports and Exports, 1955
8
6.
Estimated Chinese Communist Trade with Far Eastern
Satellites
Value of 'Recorded Chinese Communist Imports from. Non-
9
Communist Countries, 1955
Vale of Semi-Annual Recorded Chinese Communist Imports
from Various Non-Communist Areas, 1954-1955
13
Estimated Commodity Composition of Recorded Chinese
Communist Imports from Non-Communist Countries., 1950-1955 14
10. Transshipments of Western Goods through Gydnia 17
11. Value of Semi-Annual Recorded Chinese Communist Exports
to Various Non-Communist Areas, 1954-1955
12. Value of Recorded Chinese Communist Exports to Non-
Communist Countries, 1955
13. Summary of Communist China's Estimated Trade and Trade
Movements (By Estimated Actual Origin and Destination
of Shipments)
14. Communist Chinese and Macao Recorded Imports from Hong Kong
by Volume, 1955
15. Communist Chinese Recorded Exports to Hong, Kong, by
Volume, 1955
29
31
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Tables
(Continued)
Page
16.
Approximate Distribution of Estimated Overland Imports
from USSR, by Type of Commodity and by Means of Transport
,
,
1955
34
17
Approximate Distribution of Estimated Overland Exports to
USSR, by Means of Transport, 1955
36
18.
Communist Chinese Seaborne Imports.Originating from
European. Satellites, 1955
37
19.
Total Direct plus Transshipped Communist Chinese Seaborne
Exports to European Satellites, 1955
39
20.
Total Arrivals in Communist China, 1951 through 1955
42
21.
Arrivals in 1955 of Liners Owned by Eleven. Western Companies
.45
22.
The Changing Pattern. of- Soviet Bloc Arrivals
1:8
23.
POL Tanker Shipments to Soviet Far East and to Communist
China,. 1952-1955
49
24.
Utilization. of Shipping Capacity involved in Communist
Chinese Seaborne Trade, 1955
51
25.
Ships and Services Acquired by the Soviet Bloc from the West
during .1955
56
26.
Percentage Distribution of Chinese Trade, 1950-55,.In Percent
of Total Trade
65
27.
Estimated Foreign Trade of Communist China, 1950-55
65
28.
Estimated Value of Communist Chinese Imports and Exports,
1950-55
66
29.
Commodity Composition of Comznunist.Chinese .Exports, 1950,
1953 and 1955
69
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
S-E-C-R-E-T
Shipping Graphs
Following
Page
1. Merchant Ship Arrivals in Communist China, 1951-1955 4
2. Merchant Ship Arrivals in Communist China, by Country of
'Registry, 1955 44
3.. Origin of Merchant Ship Arrivals in Communist China,
195+-1955
4+.. Merchant Ship Departures from Communist China, 1955
Destination of 'Merchant Ship Departures. from Communist
China, 1954-1955
Non-Bloc Merchant Ships in Chinese Communist Coastal
Trade, 1955
44
46
46
53
fo:Be Inserted in Final Printed Copy Only
Illustrations
Figure 1 - Estimated Imports by Communist China from Non-Bloc Countries
Figure 2 - Soviet Bloc and Non-Bloc Registered Shipping Arriving in.
Communist Chinese Ports, January 1951 December 1955
.Maps
Map 1 - Communist China: Railroads and Selected Roads
.NOTE'ON CLASSIFICATION
The over-all classification of this, report is
SECRET. Some pages, however, are classified
CONFIDENTIAL and are so designated.
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E C-R-E-T
COMMUNIST CKCNA'S IMPORTS AND EXPORTS, 1955:
TRADE AND TRANSPORT INVOLVED
I? Summary of Major Developments During 1955
A. The Level of Trade (see Tables 2 and. 3, pp. 2 and 3 ff.)
Communist China's foreign trade in 1955 is estimated at approximately
$4,485 million as compared with $3,450 million in 1954 -- an overall in-
crease of thirty per cent. Of this total, however,. $620 million is
believed to have represented the acquisition under a. special loan from
the USSR-of facilities and military equipment already physically located
inChina"prior to 1955 therefore not reflecting any current movement
of goods . Another $120 million consisted of exports under Chinese aid
programs to North Korea and the Viet Minh. Only the remaining 1,865
million of imports and $1,880 million of exports represented current
commercial trade. Trade with all areas (except for Chinese aid to North
Korea) increased over 1954 levels.
The tonnage volume of Communist China's trade in 1955 is estimated
to have totalled.over 13 million metric tons, made up of some 4.2
,million tons of imports (primarily machinery, petroleum, and other in.-
dustrial materials) and,8.9,million tons of exports (primarily agricul-
tural products and minerals). Of this total tonnage, about 6.6 million
tons were seaborne and some 605 million tons were shipped overland.
A comparison of total ocean cargo movements from 1952 through 1955
shows a steady year-by-year increase:
Ocean Cargoes Arriving at or Departing
from Communist Chinese port
1952-1955
(EIC-R1-52) (EI2-4-_S3) (EIC-R1-S4)
1955
(EIC-RI-O5)
Seaborne Imports
1,098
1,526
1, 583
2, 004
Seaborne Exports
1,926
3,288
3,550
4,585
Total Seaborne Cargoes
3.,o24
4,81-4
51l33
6,589
Includes Chinese imports moving by small craft and overland to.Communist
China from Hong Kong and/or Macao -- since most of these had arrived
in the Far East by sea.
S-E-G-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Figure 1 and Figure 2 are the usual graphics
which will be inserted in the final printed
edition only of the EIC_Rl Series.
Figure 1 - "ESTIMATED IMPORTS BY COMMUNIST
CHINA FROM NON-BLOC COUNTRIES,
1951-1955"
Figure 2 "SOVIET BLOC AND NON-BLOC
REGISTERED SHIPPING ARRIVING
IN COMMUNIST CHINESE PORTS,
JANUARY 1951 - DECEMBER 1955?
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Summary of Communist China's Estimated Imports
1955
Volume of Shipments
(Thousand Metric Tons). Value of Trade
Seaborne Overland Total (Million US $)
Non-Communist
Recorded:
1...Western Europe &
Western Hemisphere
617
617
119
2.,Hong Kong
170
170
33
3. Japan
200
200
30
4. All other recorded
290
290
133
recorded
1,283
1,283
315
Unrecorded:
5- Western Europe
200
200
60
6. Macao
11
11
2.5
7. Hong Kong _a/
7
7
2.5
8. Southeast Asia
57
57
11
Subtotal, unrecorded
275
275
76
Adjustment:
9. Additional value
attributed by Chinese
Communists to their
Free World trade
29
Total, non-Communist 1,522
420
Communist
10. USSR 32
1,84o
1,872
940
11.
USSR Special Loan
620 b/
12.
European Satellites 420
180
600
.450
13.
North Korea & Mongolia
200
200
40
14.
North Vietnam
20
20
15
Total, Communist 452
2 224o
2,692
Grand Total 2 oo4
4o
4 244
2
485 b/
Some of these imports moved overland but most of the commodities involved
-' had arrived i the Far East by sea.
b/ An estimated .b20 million of facilities and military equipment acquired by
-' China under a special loan were physically located in. China prior to 1955,
and therefore did not contribute any tonnage movements to the volume of
Chinese import traffic.
S-.E-C-R-E-T
Approved For Release 2006/08/14: CIA-R?P8-2-00400RO00200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 3
Summary of Communist China's Estimated Exports
1955
Volume of Shipments
(Thousand Metric Tons) Value of Trade
Seaborne Over rland Total (Millions US $}
Non-Communist
1. Western Europe and
Western Hemisphere 370 370 121
2. Hong Kong 858 133 991 107
3 Macao 65 i~/ 9 5
4. Japan 1, 221 11221 85
5. All other recorded 161 161 102
.6. Unrecorded exports 5
Ad
justment for add-
7.
itional value attri-
buted by Chinese Com-
munists to their Free
World trade
Subtotal, Non-
Communist 133 2,788
Communist
8.
USSR
615
9.
European Satellites
1,260 c,/
10.
North.Korea and
Mongolia
11.
North Vietnam
35
30
2,645 3,260 920
295 1, 555 450
1,200 1,200 125
25 60 50
Subtotal, Communist 1,910 4,165 6,075 1,545
Grand Total 4,5.85 4,298 8,883 2,000
a~ Includes 33,000 tons in vessels under 1,000 gross registered tons (GRT).
Exports to Macao moved largely in junks and launches.
c/ Includes an estimated 547,000 tons which reached the European Satellites
through Western European ports.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
The trend toward increased Bloc participation in. Communist Chinats
foreign trade continued in 1955 when the Bloc accounted. for more than
foir-fifths of total Chinese trade. Total trade with the Free World
increased more than 25% over 1951., however, (see Figure 1) and ms
reflected ' a rise in unrecorded as well as in recorded imports.
Unrecorded imports in 1955 were about $76 million, as compared with an
estimate of $50 million for 195+ ($93 million for 1953). Chinese
Communist efforts to obtain strategic goods through smuggling channels
via Hong Kong and Macao noticeably slackened in both. 1954 and 1955 as
compared with earlier years. On the other hand transshipments of
strategic goods of Western European origin through Bloc ports in Eastern
Europe apparently increased nearly one-half in 1955 as compared with
1951. These unrecorded imports represented about 17 percent of Com-
munist China's total imports from non-Bloc countries.
_B. Transport and Transport Services
1. Shipping
There was an increase of almost 20% in the gross registered
tonnage of the ships arriving in China in 1955? compared t6-11954. Com*-
munist China continued to be heavily dependent on non-Bloc shipping,
which accounted for 81% of the tonnage of all 1955 arrivals. (See
Figure 2) Slightly over half of the non-Bloc tonnage was under British
flag; another quarter was Japanese, Dutch and Norwegian; and the re-
mainder was divided among thirteen other Free World countries. Bloc
shipping arrivals were composed of Soviet, Polish, and Czech ships
(60%, 35% and 5% of the tonnage respectively). Chinese ships carried
no ocean-borne trade except a small export to North Vietnam. China,
however, shares control with Poland over the services provided by Polish
vessels on the China run, although the details of the particular arrange-
ments involved are difficult to determine.
The general pattern of non-Bloc shipping movements was relatively
little changed in 1955 over 1954. There were, however, noticeable changes
in the 1955 pattern of Bloc shipping arrivals, particularly a sharp
increase in the number of tankers from Europe which unloaded P.O.L. in
the Soviet Far East before proceeding in ballast to China to pick up
return cargoes. Thus 59% of Bloc ships arriving in China.came from the
Soviet Far East, but only 39% of Bloc ships leaving China went to that
area.
The shipping tonnage in Communist China's foreign trade during
1955, by geographic area of origin and destination of voyages; was.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
distributed substantially as indicated in the following table:
ORIGIN AND DESTINATIONS OF SBIPPING TONNAGE IN
CHINA'S FOREIGN TRADE, 1955
Geographic Area
Origins
Destinations
(Per cent of Total
(Per cent of Total
G.R.T.)
G.R.T.)
Western Europe
27
29
Japan
21.
20
Hong Kong
17
20
Bloc Europe
9
13
U.S.S.R. (Far East)
6
7
Other
17
11
100
2. Inland Transport Connections
Railroads continued to carry over 95% of China's overland
foreign trade. The Sungari River, a few roads and air transport carried
the small remaining balance. There have been two significant develop-
ments during 1955 and early 1956. The completion of the trans-Mongolian
railroad represents a valuable addition to the facilities for the movement
of trade between China and the U.S.S.R. The rehabilitation of railroads
in North Vietnam has improved transport connections between that area.
and China.
S-E-.C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
II. Over-all Values of Trade
A. Communist China.'s Total Trade
1. The Level and Direction of Trade (1954 and 1955)
The magnitude of Communist China's foreign trade had been
estimated prior to last year largely from Communist trade announce
ments, which had usually been stated in percentages and had never been
clearly defined. In July, 1955, however, the Chinese Minister of
Foreign Trade announced that the value of China's total imports and ex-
ports in 1951+ was 8.187 billion yuan. This was the first time the
Chinese Communists had announced an absolute value for their total
foreign trade. Converting this yuuan value into U. S. dollars through
use of a cross-rate with the pound sterling. results in an evaluation for
total Chinese trade in 1954 of $3,450 million, Since the Chinese have
stated at various times that 80 percent of their foreign trade in 1951+
was with Bloc countries and 20 percent with Free World nations, the
corresponding values of 1954 trade would have been $2,760 million with
the Bloc and.$690 million with the Free World.
During 1956 the Chinese Communists have made several announce-
ments relating 1955 trade to levels in 1954 or earlier years. These in-
cluded statements that total trade increased 30% over 1954 and that
trade with the Free World increased by more than one-fourth over 1951..
In addition they announced a percentage relationship between trade with
the USSR in 1955 and corresponding trade in 1950 (in terms, apparently,
-of the yuan value of trade on current account i.e., excluding any spe-
.cial'aid credits). These announcements indicate a total value of 1955
trade of $4,1l.85 million, a value for trade with the Free World of about
$875 million, and a value for trade with the USSR of $2,1+80 million.
The Chinese have not given any indication of the distribution of
their remaining trade (i.e., $1,130 million) as between the European
Satellites and the Far Eastern Satellites. The trade turnover with the
Far Eastern Satellites may, however, be independently estimated at $230
million. on the basis of intelligence, including a number of official
announcements. (Much of this trade consisted of deliveries by Communist
China under aid programs which have been rather fully reported by North
Korea and North Vietnam,) The remaining $900 million, therefore, pre-
sumably represents trade with the European Satellites. In summary, the
value and distribution of Communist China's foreign trade in 1955 as
compared with 1954 are estimated for principal trading areas as follows:
Revised from Rl-S ,
see Appendixg.p. 63 ff.
-6-
S-E-C-R-E.-:T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 4
Recapitulation of Estimated
Value and Distribution of
Communist China's Foreign. Trade
1954 and 1955
95
195
Millons
Percent
Millions
Percent
US Dollars
of Total
US Dollars
of Total
Total Trade
$3,450
100
$4,485
100
Less Non-Bloc Trade
-6go
-20
87
-19.5
Trade with Bloc
70-
0
80.5
Of which:
USSR
1,830
53
2,480
55.3
Far Eastern Satellites
240
7
230
5.2
European Satellites
6go
20
goo
20
2. The Balance of Trade
The Chinese have made no statement regarding their trade balances
in 1955. Although ordinary trade with the Bloc under barter agreements
is estimated to have been roughly in balance, trade under long-term.
credit and. aid agreements between China and the Bloc would. have resulted
in a Chinese export deficit of approximately $520 million. In trade with
the Free World, however, China is estimated to have had an export surplus
of some $35 million, leaving a total net export deficit of about $485
million.. The resulting estimates of total imports and exports are $2,485
million and $2,000 million, respectively. Although this estimate of the
overall trade balance is necessarily rough and tentative, the level of
exports indicated is not inconsistent with Chinese Communist press
reports of their trade activities and of the volume of exports of their
major agricultural commodities.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 5
Estimated Balances of
Communist Chinese Imports and Exports, 1955
Million US $
I~mports
Exports
Total Trade
USSR
$1, 560. W
$ 920
$2,480
European satellites
1+50
450
goo
Far Eastern Satellites
~
1755b/
2 0
Total Bloc
2,065
1,M
3,610
Free World
420
455
875
d Total
G
5
$22 48
$2, 000
&4
ran
.
_
a/ includes Chinese acquisition of facilities and military equipment as
specified in their 1955 budget.
Includes Chinese grants in aid to North Korea and North Vietnam.
B. Trade with Bloc Countries
1. Trade with the USSR
It is estimated that Communist Chinese trade with the USSR in 1955
amounted to $2,480 million, of which acquisitions of 'military equipment and
facilities under a loan from the USSR probably accounted for about one-
quarter of the total. In presenting the 1955 budget, the Chinese Minister
of Finance stated that the increase in budgeted income under Credits, Loans,
Insurance & Other was mainly because the USSR, in addition to turning over
to China without compensation the naval base at Port Arthur, also trans-
ferred to China "much military equipment in the form. of a loan." In June,
1956, the Chinese Minister of Finance presented a report on the 1955-56
budgets which indicated that these total Soviet loans were $620 million.
The remaining 1955 Sino.,Soviet trade of $1,860 million is believed
to.have represented commercial trade. During 1955 Communist China. may
have utilized about $50 million under the industrial loan of $130 million
which was extended in October, 1954, and probably made a payment of $30
million to the USSR as required by the terms of the industrial loan of
1950. It is estimated, therefore, that Sino-Soviet commercial trade may
have shown a Chinese import balance of $20 million with imports from the
USSR of $940 million and exports to the USSR of $920 million.
S-.E. C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
2.. Trade with the European Satellites
Although no specific announcement has been made as to the pro-
portion of Chinese 1955 trade which was with the European Satellites,
specific'ndications have been given as to the value of over-all trade,
and as to the portions thereof accounted for by the Free World, the
USSR and the Far Eastern Satellites (see page 6 above) - leaving.a
residual of $900 million attributable to trade with the European Satellites.
This figure would represent about the same proportion of total trade as
in 1954 (i.e., about 20%). In the absence of any particular indications
otherwise, it is presumed that this trade was approximately in over-all
balance between imports and exports -- i.e., $+50 millioneach way. As
to the distribution of this trade, various trade announcements of the
individual satellite nations suggest that Chinese 1955 trade with East
Germany totalled about $250 million and that with Czechoslovakia about
$300 million. Trade with Poland, Hungary, Rumania, and Bulgaria would
have made up the remaining $350.million.
3. Trade with Far Eastern Satellites
It is estimated that Communist Chinese trade with Far Eastern
Satellites during 1955 was about $230 million, representing a slight de-
cline from 1954. Chinese aid deliveries to North Korea in 1955 were
announced by the latter as $90 million ($30 million lower than that
announced for 195+). Barter trade with North Korea is reported to have
increased over 195+ and is estimated for 1955 as $25 million in each
direction. During 1955 estimated Chinese trade with North Vietnam plus
deliveries of Chinese aid totalled about $60 million, of which $15 million
were imports and $45 million exports. Communist Chinese trade with the
Mongolian Republic, while increasing, is still small and is estimated for
1955 as $15 million in each direction.
Table 6
Estimated Chinese Communist
Trade with Far Eastern Satellites
1955
Million US-$
arts
Exports
North Korea
25
115
North Vietnam
15
45
Mongolian Republic
3-5
15
55
175
- 9 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-.C-R-E-T
C. Trade. with Non-Bloc Countries
1. General
From the trade returns of non-Communist countries, adjusted for
shipping lags and c.i.,f. costs,. it is estimated that Communist China's
recorded trade with the Free World in. 1955 included imports valued at
$315 million c.i.f. and exports valued at $420 million f.o.b./ In
addition, intelligence data, indicates that Communist China pay bave imported from the Free World some $76 million of unrecorded imports and
exported some $5 million of unrecorded exports not reflected in the pub-
fished trade statistics of non-Bloc countries, raising total imports from
the Free World to $391 million and total-exports.to $425 million.
This estimated total value of $816 million accounts for about
93 percent of the value apparently'in.dicated for Chinese Communist trade
with the Free World ($875 million) by official Chinese Communist announce-
ments. The difference is small, and falls well within the range of error
to be expected from methods of valuation of Free World trade and/or the
computation of dollar values from official Chinese Communist trade data..
It is not believed, therefore, that there was any substantial additional
volume of Free world trade with Communist China which has not been iden-
tified in Free World trade returns or in intelligence on unrecorded
trade.
2. Imports
a. Recorded Imports
The recorded value of Chinese Communist imports from non-
Bloc countries in 1955 rose to.$315 million (see Table 7) as compared with
$273 million. in 1951+,.$280 million in 1953 and $250 million in 1952.
Th orts rose sharply in the second half of 1955, following .a rise in the
value of exports, suggesting a.trend toward a higher level of total imports
in 1956 -- particularly from the Near East and South and Southeast Asia.
Since all. transport services beyond China's borders are under non-
Chinese-Communist ownership, the Chinese must pay shipping charges
to their own borders. on all imports, and receive only the net value
of exports f.o.b.. their own borders. Pre-Communist trade statistics
of China were calculated on this basis and it is believed the Com-
munists have continued the same practice.
S-E-C-RT
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 7
Value of Recorded Communist Chineseorts
from Non-Communist Countries .a
1955
Thousand US .$
195 1954
Jan -Jun
Jul-Dec
Total
Total
EUROPE, WESTERN (SPHERE
ANIi SOUTH AFRICA _
Argentina
1,112.
38
1,150
1,495
Austria,
954
1,740
2,6914
445
Belgium-Luxembourg,
110,89
4,346
5,435
426
Brazil
128
4,544
4,672
2,938
Denmark
25
31
56
185
Finland
7,455
7,151
14,606
3,390
France
3,035
3,403
6,438
8,379
West Germany
14,461
14,027
28,488
20,554
Italy
2,382
3,459
5,841
5,285
Netherlands
1,256
1,535
2,791
1,565
Norway
24
11
35
28
Sweden
812
734
1,546
632
Switzerland (c.i.f.)
7,863
2,705
10,568
4,085
Union of South Africa
711
332
1,043
n.a..
United Kingdom
11,795
10,961
22,756
18,170~
United States
0
.~.d,
6d
Canada
1,043
1
1,057
47
10 percent adjustment
for c.i.f. (except
Switzerland)
4,628
5,233
9,861
6,354
Subtotal
58,773
60,267
119,040
73,984
* Footnotes for Table 7 follow,on page 12.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 7
Value of Recorded Communist Chinese orts
from Non-Communist Countries a
1955
(Continued)
1955
Country
1954
JanJun Jul-Dec Total Total
Australia
3,528
3,002
6,530
3,421
Burma
6,052
7,908
13,960
22
Ceylon
8,761
14,053
22,814
48,429
Eft
7,588
15,493
23,081
11,389
Hong .Kong
20, 958
10,185
31,143
67,154
India)
7,187
8,642
15,829
5,798
Indonesia
2,907
3,314
6,221
1,014
Japan
14,592
13,960
28,552
19,109
Malaya
2,329
1,702
4)031
6,561
New Zealand
26
240
266
50
-Pakistan
7,414
27,111
34,525
26,189
5 percent adjustment
for c.i.f.
4,067
5,281
9,348
9,457
Subtotal
85,409
110,891
196,300
198,593
Total
144,182
171,158
31 340
.-272,577
a As derived from. published statistics of the non-Communist countries
concerned. The above table differs from Ri-S4 in 1954 data by the.
addition of estimated trade with New. Zealand.
Figures for countries of Western Europe, the Western.Hemisphere, and
the Union of South Africa are based on the assumption of a 2-months
voyage.. They represent recorded exports for November 1954 through
October 1955. Figures for Australia, Burma, . Ceylon,. Egypt, Indonesia,
Malaya, India, New Zealand and Pakistan are based on the assumption
of a 1-month voyage -- i.e., they represent recorded exports for
December 1954 through November 1955. Figures for the remaining
countries are exports for themonths shown in the table. All sta-
tistics were converted at the official exchange rates? exc pt Hong
Kong figures which were converted at an average rate of HK$
US$.1712 for the second half..
S-E-C-R-E-T
Thousand US $
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-.E-C-R-E-T
c. Includes imports into Tibet during 195+ and the first half of 1955.
Data on imports into Tibet for the second half of 1955 are incomplete.
d. Represents U.S. shipments to Communist China under Exceptions pro-
cedures. For 1955 these shipments represented printed matter; for
195+ these shipments (including an auto) were for use of a diplomatic
mission of a friendly foreign country.
The value of recorded direct imports from Western Europe increased
by three-fifths over 1954, but this increase was offset by a nearly equal
decline in imports from Hong Kong. Since imports from Hong Kong had consisted
largely of transshipments of Western European products, these statistics
reflect primarily changes in the methods of shipment, rather than in the
levels of trade. Imports from Japan, after registering a sharp increase
in the second half of 1954, remained at this level throughout 1955.
Imports from other countries of the Near East and Asia, particularly from
Burma, Egypt, India, .Pakistan, and Indonesia, increased sharply over 195+
levels, most of the trade occurring in the second half of the year. These
trends-are shown in the following tabulation:
Value of Semi-Annual Recorded Communist Chinese Imports
from Various Non-Communist Areas
195+-55
Western Europe &
Western Hemisphere
Hong Kong
Japan
Near East
1954
January-
June 37
33
5
65
July-Dec
ember 37
37
15
44
1955
January-June 59
22
15
48
July-December 60
11
15
82
The commodity composition of Communist China's recorded imports
from the Free World changed somewhat in 1955 as compared with previous
years. Imports of drugs, crude rubber=/, and metals and machinery de-
clined to or below the lowest levels recorded in the previous five years.
l But see comment on pp. 14?and 15,ff
- 13 -
S-E-C-R.E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Imports of cotton and chemicals increased, the latter category, con-
sisting largely of fertilizer and industrial chemicals, reaching the
highest level recorded since 1950- Imports of 'other items also in-
creased sharply, the major imports in the group consisting of wool,
textile yarns and fabrics, foodstuffs, coconut oil, paper, and jute.
The trends in the commodity composition of Communist China's imports
from the Free World are shown in the following tabulation;
Table 9
Estimated Commodity Composition of Recorded Communist Chinese Imports
from Non-Commmunist Countries
1950-55
Million US
Year
Cotton
Rubber
Drugs
Chemicals
Metals,
Machin
Oth
ery
er
1956
95
61
20
35
125.
78
1951
41
110
25
65
110
93.
1952
108
23
25
40
20
34
1953
16
54
40
55
70
45
1954
42
47
20
80
25
59
1955
75
23 /
10
90
20
97
a/ But see comment below pp. 14 and 15 f:; 4
Imports from Western Europe, Hong Kong, and. Japan consistedlarrgely
of industrial goods and raw materials. Chemicals (including fertilizers,
dyes, drugs, and industrial chemicals) accounted for 50 percent by value
of the imports from.. Western Europe, 70 percent of the imports from Hong
Kong, and. 63 percent Of the imports from. Japan. Textile fibers and
fabrics accounted for 17 percent, 11 percent, and 21 percent, respectively,
of the value of imports from these three areas; metals and manufactures
accounted for 9 percent, 7 percent, and 11 percent.
Imports from Asia, Oceania, and the Near East, on. the other hand,
consisted largely of agricultural products. Cotton constituted',the bilk
of imports from Pakistan and Egypt, while imports from. Ceylon consisted
chiefly of crude rubber. (The apparent decline in rubber imports from
- 1.4 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Ceylon results from the fact that, of the 50,000 tons scheduled for 1955
under the five-year rice-rubber agreement, about 5,000 tons arrived in
the last month of 1951+ and about 15,000 tons in the first quarter of
1956, so that the 1955 returns included only 30,000 tons of this contract
rubber plus 1,000 tons of non-contract rubber.) Rice constituted the
bulk of imports from Burma, amounting to nearly 100,000 tons valued at
$12 million (excluding the additional 50,000 tons purchased by Communist
China but shipped direct to Ceylon in partial fulfillment of the Sino-
Ceylon rice-rubber agreement). Imports from Indonesia consisted chiefly
of $3 million of coconut oil and $2 million of sugar; while imports from
Malaya consisted. almost entirely of coconut oil. Imports from Australia
were largely wool tops, and the main imports from India were gunny bags
and raw cotton.
b. Unrecorded Imports
(1) Tees of Unrecorded Imports
Evasions of CHINCOM and other official controls typically
take the form of false declarations of ultimate destination, thus facili-
tating the shipment of controlled goods to Communist China by circuitous
routes. When controls are circumvented or evaded in this mannerathe
exports involved are not identified in the trade statistics of the country
of origin as exports to Communist China.
In Western Europe this form of evasion typically takes
place through the export of vci goods controlled by CHINCOM (but
not by COCOM) agreements to a free port --where transshipment of such
goods is not controlled -- followed by reconsignment to Gdynia where, in
turn, the goods are transferred to a Soviet Bloceflag or chartered ship
loading for China. In such cases, the original export from the country
of origin to the country of transshipment is ordinarily authorized on the
explicit understanding that the latter country, or some other friendly
country, is to be the final destination. At the port of transshipment,
however, these goods are taken over by firms specializing in the re-
direction of controlled goods to Poland.
In some cases these indirect shipments are facilitated
by the intervention of a trader in a third country, who may finance the
--
transaction--- buying from the country of origin and selling to China
without himself handling the goods. The goods are exported from the
country of origin ostensibly for the intermediary, but are actually
consigned to a transshipment firm in a free port which will forward them
at the intermediary's request to Poland in transit for,;China.
S-E_ C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
T
S-E-C-R-E-T
In other instances, goods have been consigned from non-
Communist exporting countries directly to Poland, whence they were re
directed to China. This technique is, of course, applicable only to,
goods which are not embargoed by the exporting country for shipment to
European countries of the Bloc. In these cases the Polish port may serve
merely as the point of transshipment, or the Poles may actually import
the goods for later re-export to,China. There is clear evidence that
the circumvention of controls by such transshipment in Polish ports is
practiced on a substantial scale. The extent to which Soviet Bloc
countries may import goods from theiWest for later re-export to China
cannot be assessed.
The techniques described above are used principally in
North Sea ports. There is some evidence that they are also being used
in Mediterranean. ports and that similar devices are in use for overland
shipments to China from. Switzerland via Czechoslovakia, and from West
Germany via East Germany.
Other devices in use for the circumvention of controls
include.. false, inadequate, or misleading description of goods destined
for Communist China; false declarations of destination byt.vessels sailing
for Communist China; and local smuggling. There have also been reports
of illegal use of import certificates and. of fabricated (dual) manifests.
(2) Transshipments of Western Commodities through Soviet
Bloc Countries
Analysis `of ship cargoes andother intelligence indicate
that substantial amounts of iron and steel and of other goods in CHINCOM
controlled categories were sold and shipped to Communist China but were
not so recorded in the trade returns of Western European countries.
Cargo estimates, based on the general composition of all cargoes and the
known origins of 'over three-fourths of the shipments, indicate d a othat
about 165,000 tons of iron. and steel and about 35,000 commodities in CHINCOM controlled categories. represented goods of
Western origin which were transshipped to.China via Eastern European.
ports (principally Gdynia) during 1955.
accordingly, represent a part of the
e tonnages
Th
,
es
unrecorded 1955 imports of Communist China from Western Europe. On the
basis of estimated average prices, these transshipped 200,000 tons are
valued at $57 million, made up of $28 million for iron and steel and
$29 million for'. nonferrous metals, chemicals, petroleum instruments and
other commodities in controlled categories.
- 16
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 10
Transshipments of Western Goods
through. Gdynia
Volume
Value
(Tons)
(000 US $)
POL
2)000
$ 120
.Iron and steel
165,000
28,000
Nonferrous Metals
20,000
16,000
General industrial machinery
3,000
7,280
Chemicals and Drugs
10,.00.0
88,600
200,000.
60 000
(3) Unrecorded Trade From Hones. Kong
There is still no firm intelligence on the volume of
smuggling from Hong Kong to China by small craft and overland, either
directly or via Macao. Intelligence suggests that such. smuggling
activities declined in 1953 and 1951h This downward trend continued
during most of 1955, but increased again toward the end of the year as
the Chinese Communists apparently sought to secure commodities quickly --
principally POL - in order to supply the Viet Minh. It is estimated,
therefore, that the volume of smuggling during 1955 remained at 7,000
tans., or the same level as in l954,.but that the value declined to about
$2.5 million because of changed composition.
(1.) Unrecorded Trade from Macao
There are no published official trade statistics on
Macao's exports to Communist China in 1955. Such exports appear to have
declined sharply from those of previous years, when strategic commodities
were carried via Macao by Portuguese vessels. Such. traffic appears to
have ended in 1955? In 1955, Hong Kong's recorded exports to Macao
totalled 70,000 tons valued at approximately $10 million. Of these
exports, strategic goods amounted in value to slightly more than $1
million, up to one-half of which may have been re-exported to Communist
China. In addition, official unpublished information from Macao indi-
cated that exports of non?strategic.goods to Communist China in 1954
approximated 7,000 tons valued at $2 million, and it is believed that
1955 exports may have been of similar magnitude.
-17-
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S.E-C-R-E-T
(5) Unrecorded Trade from Southeast Asia
Unrecorded shipments of 7,000 tons of rubber, from
Indonesia to Communist China valued at $6 million, are known to have
occurred in 1955. These shipments were ostensibly exported to another
destination, but were actually delivered to Communist China.
During 1955, Communist China imported about 50,000
tons of rice from Burma which were resold to Ceylon and actually moved
directly from Burma to Ceylon on Chinese account. This rice, valued. at
$5 million, appeared on Burmese trade returns as an export to Ceylon
rather than as an export to Communist China, but it is believed that
the Chinese Communists probably recorded it as both an import from
Burma and a re-export to Ceylon.
(6) Recapitulation
Communist China's total unrecorded imports in 1955
are therefore estimated as follows:
Metric Tons
Million US $
Transshipments,
Western Europe
200,000
60.0
From Hong Kong
7,000
2.5
From Macao
11,000
2.5
From Southeast Asia
57,000
11.0
275,000
76.0
3. EXPO
a. Recorded Exports
Communist China's exports to the Free World recorded by non-
Bloc countries rose sharply in 1955 to $420 million (see Table 11), as
compared with $297 million in 1954, $323 million in 1953, and $270
million in 1952. The exports showed a stable trend during the year,
reaching nearly $206 million in the first half and over $214 million in
the second half of 1955.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Exports to Hong Kong and the industrial nations of Western.
Europe and Japan rose sharply in 1955, accounting. for almost all of the
increase. Of exports to other countries, there was a decline in the
direct exports of rice to Ceylon, but this was offset by generally
increased exports to other countries of the Near East and Asia. These
trends are shown in the following tabulation:
Value of Semi-Annual Recorded 0oamnunist Chinese Exports
to Various Non-Communist Areas
1954-55
Million us.$
Western Hemisphere Hong Kong
Japan
Neax East Total
1954
January-June
40
23.
17
51
131
July-December
47
44
22
52
165
1955
January=June
61
48
38
59
206
July-December
60
59
39
56
214
Exports to non-Communist countries consisted about 4+5
percent, by value, of foodstuffs (including rice,-other cereals, vege-
table oils for food use, eggs, fruits, vegetables, pulses, and tea), 33
percent of oilseeds and other agricultural raw materials (such as textile
fibers, essential oils, skins and pelts, tong oil, and miscellaneous
crude materials), and 22 percent of 'a variety of miscellaneous goods
(mainly ores, minerals and products of light industry).
Western Europe and the Western Hemisphere received nearly 30
percent, by value, of all exports to non-Communist countries, of which
about one-fifth represented foodstuffs and another three-fifths oilseeds
and other agricultural raw materials. Somewhat over 25 percent of all
recorded exports went to Hong Kong, of which food items were about two-
thirds by value and miscellaneous light-industrial goods nearly one-
fifth.. Exports to Japan were somewhat less than 20 percent of the total,
and included oilseeds (38 percent), food (30 percent), ores and minerals.
(iii. percent), and other raw materials from agriculture (most of the
remainder). Exports to other areas were constituted largely of food,
S.$-C-R-E.T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
and of light-industrial exports (the bulk of which went to South and
Southeast Asia).
b. Unrecorded Exhorts
In addition to recorded exports there were 50,000 tons of
Burmese rice valued at $5 million which were purchased by the Chinese
Communists but shipped directly from Burma to Ceylon.. It is believed
that the Chinese recorded these rice shipments both as imports from
Burma and as exports to Ceylon.. No allowance has been made in this
paper for opium or other narcotics exports, since intelligence indicates
that any earnings from. this source would be relatively insignificant.
S-E- C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Value of Recorded Communist Chinese Exports
to Non-Communist Countries
1955 a/*
Thousand US
1955
1954
Country
Jan-June
July-Dec.
Total
Total
EUROPE, WESTERN HEMISPHERE
AND SOUTH AFRICA J
Austria.
453
556
1,009
878
Belgium-Luxembourg
961
1,162.
2,123
2,058
Canada.
1,909
2,381
4,290
1,541
Colombia
13
18
31
311
Denmark
69
126
195
30
Finland
2,819
764
3,583
2,953
France
4,949
7,053
12,002
8,972
West Germany
23,781
22,136
45,917
37,688
Italy
1,781
3,092
4,873
2,-182
Mexico
206
130
336
354
Netherlands
5,231
3,293
8,524
6,306
Norway
713
1,841
2,-554
2,439
Sweden
1,333
1,14o
2,473
1,159
Switzerland
10,227
8,839
19,066
10,599
Union of South Africa
464
559
1,023
n.a.
United Kingdom
16,870
16,799
33,669
25,664
United States
102
125
227
170
15 percent adjustment for
c.i.f. (except for the
US and Canada)
-10,481
-10,126
-20,607
-15,239
Subtotal
61,4oo
59,888
121,288
88,o65
*Footnotes for Table 12 follow on pp. 22, 23.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 12
Value of Recorded. Communist Chinese Exports
to Non-Communist Countries
1955 at
(Continued)
Country
NEAR EAST, AAI,A
AND. OCEANIA
Australia
Burma
Ceylon
Egypt
French Morocco
French West Africa
India
Indonesia
Japan
Macao
Malaya
New Zealand
Pakistan
Philippines
Taiwan
Vietnam e/
5 percent adjustment for
c.i.f. except for the
Philippines
Subtotal
Hong Kong f/
TOTAL
Jan-June
July-Dec.
Total
2,019
2,691
4,710
1
4,521
4,522
10,855
6,ol6
16,871
459
1,359
1,818
11,708
5,265
16,973
1,171
349
1,520
3,880
3,875
7,755
5,377
5,572
10,949
39,880
40,.901
80,781
2,580
2,500
5,080
17,563
21,007
38,570
326
500
826
248
146
394
188
200
388
862
1,062
1,924
4,303
4,500
8,803
-5,062
-5,013
-10,075
96,358
95,451
191,809
48,000
59,300
107,300
8
2-0-175
214,639
420,397
58
1954
Total
3,878
306
32,260 /
818
12,493
1,156
4,922
,41228
40,770
5,542
29,108
628
1,375
945
3,411
8,381
-7,464
142,757
66,700
297,522
a. Data derived from published statistics of non-Communist countries con-
cerned. Most countries report their imports by country of original origin
so that a portion of their imports recorded "from China"'were: actually
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 12
Value of Recorded Communist Chinese Exports
to Non-Communist Countries
1955
(Continued)
purchased from other intervening owners. For example, the exports recorded
above to Taiwan were all resold transshipments, and the "exports" to the US
included such items as art objects which may have left China years ago.
Second-half 1954 figures, are revised to reflect complete data for the year
and therefore differ slightly in some cases from those found in EIC-R1-94.
Data for the first half of 1955 are complete for all countries; data for
the second half are complete except for Mexico, the, Philippines, and
Vietnam which were estimated from data for less than six months.
b. Figures for countries of Western Europe, Western Hemisphere, and the
Union of South Africa.are.basted on the assumption of a two-month voyage.
They represent recorded imports for March of the reported year through
February of the following year. Figures for Hong Kong,, Japan, Macao,, the
Philippines, Taiwan, and Vietnam are recorded imports for the months shown.
in the table.. Figures. for the remaining countries are based on aone-month
Voyage, or imports of February of the reported year through. January of the
following year.
c. Sugar imports from Taiwan amounting to US $1,223,000 were deducted
from. first half 1954 imports from Communist China as reported in Ceylon's
trade statistics.
d. Includes India's exports to Tibet for 1954 and first half of 1955.
Data for the second half are incomplete.
-e'. The data for 1954 refer to Indochina and presumably include trade
with South Vietnam, Laos, and Cambodia. January-May 1955 data are
reported in the source as imports into North and South Vietnam. Starting
in June 1955 only imports into South Vietnam are reported presumably
excluding imports into Laos, Cambodia and North Vietnam.
f.. A. deduction has been made from Hong Kong's recorded imports from
Communist China to eliminate duplication resulting from the. fact that
many countries (all listed countries except the UK, Belgium, Canada,
Denmark, the. Netherlands, Egypt, Australia, India,, New Zealand, and
the Philippines) record imports from Hong Kong of Chinese' origin as
imports from Communist China. In these cases, goods exported by
Communist China are recorded as imports both by Hong Kong and the
country of destination. For 1954 and 1955 the amount of this deduction
in million of US dollars was.estimated as, follows:
S-E-C-R#E-T
Approved. For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
Table 12
Value of Recorded Communist Chinese Exports
to Non-Communist Countries
1955
(Continued)
195 195+
January - June July December Total Total
Hong Kong,total imports 69.4 84.8 154'12'. 118.8
from Communist China
Less; Estimated.re-
exportsrecorded in
import data of other
countries as imports
from. Communist China
Taiwan
.Japan
Malaya
Indonesia
Vietnam
Other
Hord: Kong's retained
imports from Communist
China and re-exports
not recorded in import
data of other countries
as imports from Communist
China
0.9
1.1
2.0
3..
5.. 9
6.9
12`.8
17.7
6.3
6.6
12.9
13.6
O9
1.5
2.4
2.2
1.1
2.1
3.2
3.0
-21
3
-25.5
2-3.6
-Lk- 9 12.2
-52.
1
1?8.0
5-9..3
107.3
-
.66.
2.
5.?E-C-R-E~T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
III. Value and Volume of Principal Trade Movements
A. Total Chinese Communist. Trade
1. Introduction
The total volume of Communist China's 1955 trade is.estimated.
to have been 13.1 million tons,. of which-51 percent has been established
from. trade data and cargo=estimates, 22 percent directly from other
evidence, and 27 percent based primarily on estimated pricing of
'residual values.
2. Total Imports
As indicated in Section II, above, total imports into Communist
China during 1955 are estimated at $2,485 million, 1/ of which, however,
only $1,865 million represented actual 1955 movements, of goods --
estimated at some 1+.2.million tons. Analysis of'cargoes indicates that
approximately $605 million, representing just over 2 million tons, moved
by ocean shipping, leaving a balance of $1,260 million, representing some
2.2 million tons, which . is: estimated to have moved overland -- largely by
rail. (See Table 13, page 26, and the detailed discussions following.)
3. Total Exports
Communist China's' exports during 1955 are estimated at $2,000
million, representing some 8.8 'million tons.. These were made up:of an
estimated $6L.5 million exported by ocean shipping, representing 4.5 million
tons,. and a balance of $1,355 million, representing 4+.3 million tons, which
molted overland -- nearly: .98%... by rail. (See Table 13, page 26, and the
detailed discussions following.)
This figure of $2,485 million includes an estimated 620 million of
facilities and military equipment acquired by China under'a special
loan from the USSR, which did not contribute any 1955 tonnage move-
ments to the..volume of Chinese import traffic. (See Section II, B. 1,
and Section II, C. 1. above.)
- 25 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Summary of Communist China's Estimated Trade and Trade Movements
(By Estimated Actual Origin and Destination of Shipments)
1955
By Sea Overland
Thousand Million Thousand Million Thousand Million
Metric Tons US Dollars Metric Tons US Dollars Metric Tons US Dollars
Imports From:
Non-Bloc 1,552 c
420
1,552
420
USSR - Trade
32
10
1,840
930
1,872
940
USSR - Special Loan a/
a/
e
- _/
-
(620) 1
European. Satellites
420
175
180
275
600
450
North Korea and Mongolia
-
-
200
40
200
40
North Vietnam
-
-
20
- 15
20
15
n
I
Total
2,004
605
2,240
1,260
4,244
(2,485) a/
Exports To.:
Non Bloc 2,675
430
133
-25
2,808
455
USSR 615
55
2,645
865
3,260
920
European-Satellites 1,260
155
295
295
1,555
450
North Korea and Mongolia -
-
1,200
125
1,200
125
North Vietnam 35
5
.25
45
60
50
Total 4,585
645
4,298
1,355
8,883
2,000
Grand Total 6,589
1,250
6,538
2,615
13,127
(4,485) a/
Footnotes follow on p. 27.
Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
S-E-C-R=E-T
Table 13
Summary of Communist China's Estimated Trade and Trade Movements
(By Estimated Actual Origin and Destination of'Shipments)
1955
(Continued)
An estimated $620 million of facilities:and'military equipment acquired
by China under a special loan were physically located in China prior to
1955, and therefore did.nnt contribute any tonnage movements. to the
volume of'Chinese import traffic.
'Based on cargo data except for Japan and Hoag Kong, for which trade
return figures have been used tosupplement incomplete cargo data.
Includes., negligible tonnages which moved to China from Kowloon (Hong
Kong) by truck or over the Canton-Kowloon Railroad., or from Macao via
smuggling through the Kowloon area. These goods, however, all arrived
in Hong Kong or Macao by sea from the West.
Represents exports via truck and railroad to Kowloon (Hong Kong) of
commodities for consumption within the colony.
-27-
8-E-C -R-E-T
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
S ESC-R-E-T
B. Trade, with Non-Bloc Countries
1. Imports
Import cargoes from non-Communist countries in 1955 totalled some
1.5.million tons, of which all but an insignificant amount moved by
ocean shipping. :, This volume estimate is based on intelligence on
individual cargoes -- except for Japan and Hong Kong where trade statistics
were used to supplement incomplete cargo data.
Western Europe shipped about 817,000 tons of cargo to Communist
China in 1955 (including. an'e~timated 200,000 tons transshipped'via Bloc
ports in Europe in'order to circumvent CHINCOM differential controls). Of
this total the principal items were fertilizer (380,000 tons), and iroh
and steel (170,000 tons; of which 165,000'were indirect transshipments).
Chemicals, machinery, and nonferrous metals were important items in the
remaining tonnage (267,000 tons).
About 11+0,000 tons of seaborne cargo (excluding junk and river
'steamer cargo) reached Communist China. from Hong Kong, consisting largely
of 126,000 tons of chemical fertilizers. The balance was made up of other
chemicals, machinery, and small tonnages . of 'miscellaneous items.
Japan exported about 200,000 tone ofcargo consisting mainly of
175,000 tons of fertilizers, 10,000 tons of other chemicals, as well as some
iron and steel, nonferrous metals, machinery, and other products.
Cargo data indicate an'estimated 290,000 tons of seaborne shipments
from. other areas -- including. 42,000 tons of rubber (33,000 from Ceylon,
2,000 from Burma., and 7,000 of'unrecorded exports from Indonesia); 60,ooo
tons of'cotton, principally from Pakistan, Egypt, and India; 8,000 tons of
coconut oil from Ceylon, Malaya, and Indonesia; and. 25,000 tons,of fertilizer
from Canada. These figures differ somewhat from trade data, in that the
volume of cotton based on trade data totalled some 70,000 tons (including
6,500 tons from Brazil), and coconut oil and copra imports amounted to
31,000 tons, so that some of these tonnages apparently moved indirectly.
Of this total about 88,000 tons reached China by small craft or overland
(via Hong Kong and Macao), but most of these commodities had arrived in
the Far East by ocean shipping.from the West.
- 28 -
SE=C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 14
Communist Chinese and Macao Recorded Imports from Hong Kong, by Volume a/
January - December 1955
Thousand Metric Tons
January - June
Method of Transport China Macao Total
Oceangoing Vessels
River Steamers
71 1 72
8 8
Junks 21 25
Launches
Total - Waterborne 92 34 126
(Rail-and Road movements were insignificant)
July - December January - December
China Macao Total China Macao Total
69 1 70 140 2 142
10 10 - 18 18
12 25 37 33 50 83
3 3 3 3
84 36 120 176 70 246
_! This table (compiled from Hong Kong official statistics) shows all recorded traffic from
Hong Kong to China and Macao including (1) goods exported from Hong Kong, and (2) goods
exported to China from third countries via Hong Kong and transshipped there. It does not
include transit cargo i.e., cargo arriving in a ship calling at Hong Kong enroute for
China but not transshipped in the Colony. Data were reported in long tons but have been
converted to metric tons in the table above to facilitate comparison with metric ton
figures throughout the report.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
2. Exports
The volume of Chinese Communist exports to Free World countries,
transported chiefly by ocean shipping, totalled:oyer 3.3 million tons
including about 550,000 tons of cargo arriving in Western ports for trans-
shipment to the Soviet Bloc. The remaining million tons are believed
to represent exports of Chinese goods for Wes consumption.
Cargo data reveal that Western Europe received about 920,000 tons
from Communist China in 1955, of which it is estimated nearly 550,000 tons
were transshipped to the European Satellites I/ and. about 370,000 tons
retained by Western European countries. It is estimated that this 370X000
tons included about 215,000 tons of soya beans,, peanuts and other oilseeds,
70,000 tons of other foodstuffs, 29,000 tons ;of industrial. oils, 20,000
tons of other agricultural products, 15,000 tons of non-ferrous. ores, and
10,000 tons of textiles. The remaining 15,000 tons. of miscellaneous and
unidentified products was largely made up of miscellaneous chemicals and
handicraft products.
Of a total volume of 1,221,000 tons moving directly from Communist
China to Japan., salt amounted to about 630,000 tons, soya beans 200,000
tons, rice 12+,000 tons, nonferrous metals and ores 83,000 tons, and
miscellaneous agricultural raw materials 118,000 tons J
Hong Kong shipping returns showed exports from Communist China of
some 990,000 tons. (See Table. 15, page 31 f.) consisting mainly of foodstuffs,.
agricultural raw materials, and construction materials. It is believed that
about two-thirds of the volume of these Chinese products were :retained in
Hong Kong during 1955, the balance representing Hong Kong reexports.
Cargo data indicate that the Near East, Africa, South and Southeast
Asia received about. 161,000 tons from Communist China during 1955. This
included 93,000 tons. of rice and other cereals, 9,000 tons of soya beans,
and other agricultural and light industrial products.
Included in the transshipments were about 210,000 tons of iron ore,
200,000 tons.of soya beans, and 50,000 tons of peanuts.
In view of the gaps in intelligence on cargoes from Communist China
to Japan and Hong Kong, official trade data have been used to.supploment
cargo intelligence on tonnages shipped during 1955.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
8 E-C-R-E-T
Table 15
Communist Chinese Recorded Exports to Hong Kong, by Volume..W
January - December 1955
Thousand.Metric Tons
Method. ',of Traxisport
January - June
December
January
- December
Oceangoing Vessels.
113
,
225
River Steamers
Junks
236
363
599
Launches
14
20
34
Subtotal.- Waterborne
362
496
858
Rail
53
67
Road
13
Total - Waterborne
and Overland
x+21
5'70
991
This table (compiled from Hong Kong official statistics) shots all
recorded traffic from China to Hong Kong including-. (1) goods:
imported into Hong Kong and (2) goods imported from China, destined
for a third country and transshipped at Hong Kong. It. does not
include transit cargo. Data were reported in long tons, but have
been converted to metric tons in the table above to facilitate
comparison with metric ton figures throughout the report.
Nil or negligible.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
C... Trade with the Soviet Bloc
1. Trade with the USSR
The value of total 1955 trade between China and the USSR has
been estimated as $2,1+80 million.. It is believed that $620 million of
this total represented facilities and military equipment acquired by China
under a special loan from the USSR and physically located in Communist
China and the Port Arthur area prior to 1955 -- so that they would not have
contributed any tonnage movements to the volume of Chinese import traffic.
The.remaining $1,860 million of trade with the USSR was made
up (see Section II, B.l, p.8 above) of $91+0 million of Chinese imports and
$920 million of Chinese exports, which are estimated to have represented
close to.1.9 million tons of Chinese imports and 3.3 million tons of
Chinese exports.
a. Imports from the USSR
(1) Seaborne
Communist China's imports by sea from the USSR in 1955
were lower than in 1954, principally because direct seaborne shipments of
petroleum products declined to approximately 13,000 tons of which the bulk
arrived in a single shipment of nearly 10,000 tons from the Black Sea area.
Other cargoes are estimated (largely on the basis of air photographs) to
have totalled 19,000 tons, of which paper was probably the principal
single item. Pricing the POL at $50 per ton and other items at prices
ranging from $200 to $1,000 per ton gives a total estimated value for
these shipments of $10 million.
(2) Overland
The $930 million difference between estimated total
imports of $91+0 million and seaborne cargoes of $10 million represents
overland imports from the USSR, with an estimated volume of 1,810,000
tons. Over 90 percent of these overland imports moved by rail.
From available intelligence it is estimated that
the total of Chinese imports of petroleum products increased about 20
percent in 1955 from the 1951+ level of over 1 million tons to over 1.2
million tons. About 75,000 tona of this quantity moved by sea from the
European Satellites and about 13,000 tons by sea from the USSR. The
balance of roughly 1,150,000 tons moved overland from the'USSR, and
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
accounted for more. than half the total volume of overland imports from the
USSR. Some of these petroleum imports moved from the Black Sea area by
sea to Vladivostok and were transshipped to Communist China, largely by rail
via Grodekovo. The total of such transshipments plus receipts from Soviet
Par East refineries is..estimated to have amounted to half a million tons,
of which, however, a substantial portion (perhaps 150,000 tons) probably
moved to China by barge.:on the Amur and Sungari Rivers. The remaining
imports of some 650,000 tons of POL presumably moved via the Trans-Siberian
Railroad through.Otpor. Applytng;an average price of something over $50 per
ton, the total overland shipments of petroleum, products have been valued at
$60 million.
Despite announced increases in Chinese steel capacity
and occasional exports of certain'simple types,off'Chinese steel, it is
believed that over-all Chinese import requirements for steel. have continued
to rise. On the other hand, evidence now available suggests that the
estimate made for overland steel imports in E IC-R1-S1 was higher than the
actual movement, and that this 195+ movement was probably well under 200,000
tons. For 1955, therefore, imports of steel .from the USSR are estimated at
approximately 200,000 tons with a value of $30 million.
It is probably that, in addition to the military
equipment turned:over to the Chinese when Soviet forces withdrew from Port
Arthur, the Chinese receivedcertain direct military imports from the USSR.
Although the value and volume of such direct military imports for 1955 are
unknown, the-EIC-Rl-S1 estimates for 1954 provide some indication. of their
likely magnitude. Accordingly, it i.s.estimated that about $150 million of
military equipment may have been imported from the USSR during.1955,
corresponding to a traffic volume of about 30,000 tons...
Although the balance of Chinese imports cannot be
specifically identified, it is believed that they consisted primarily
of industrial equipment, mining and agricultural machinery, vehicles
and instruments -- all of which are required in increasing volume by
the Chinese to meet the expanding demands of their industrialization
program. On the basis of press announcements and other information,
these imports appear to have been of a relatively high value per ton --
estimated at an average of $1,500. The remaining $690 million of imports
would, therefore, have represented-approximately 160,000 tons of "traffic.
Total overland imports from the USSR are accordingly
estimated as 1,840,.000 tons, the bulk of which is believed to have been
shipped via the Trans-Siberian Railroad through Otpor.. Shipments through.
Grodekovo, primarily petroleum products, probably increased during 1955
and are estimated.a's 350,000 tons.. It is probable that 150,000 tons of
33 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E,.T
petroleum products plus small tonnages of other goods were shipped via the
Sungari River,. and that 20,000 tons. of equipment and ,consumer goods were
shipped by road to Sinkiang. Total rail shipmnts.through Otpor, there-
fore, may be estimated as 1,310,000 tons.
Table 16
Approximate Distribution of Estimated Overland Imports from USSR,
by Type of Commodity and by Means of Transport
1955-
Thousand
Million US. $
Metric Tons
By Type of Commodity
POL
60
1,150
Steel
30
200
Military Equipment and Supplies
150
30
Other
690
l+6o
Total
930
,84
By Means of Transport
By Rail through Grodekovo
350
By Rail through Otpor
1,310
By Sungari River
16o
By Road to Sinkiang
20
1,8l-o
b. Exports to USSR
(1) Seaborne
Approximately 615,000 tons of Chinese exports
moved by sea to the USSR during 1955, with a total value of about $55
million. This total was distributed as follows:
- 3'. -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Million US. $
Thousand
Metric Tons
To USSR Ports in Europe:
Commodity Shipments
24
173
To the Soviet Far East:
Commodity Shipments
16
418
Barges, Motor Launches,
etc.
15
24
Total
55
615
Exports to USSR ports in Europe consisted primarily
of soya beans, plus some rice and peanuts, and a single shipment of soda
ash. Commodity shipments to the Soviet Far East consisted about half (by
volume) of coal, with the balance made up largely of cement, salt and
foodstuffs. With the exception of foodstuffs these commodities are all
of extremely low value per ton. In addition a number of Chinese-built
small craft were observed being delivered to the Soviet Far East either
as deck cargo, in tow, or moving under their own power.
(2) Overland
The remaining $865 million of estimated Chinese
-exports to the USSR during 1955 moved overland, over 95 percent by
rail. The volume of these overland exports is estimated at about 2.65
million tons, of which over one-third moved to the Soviet Far East by
rail via Grodekovo., or on the Sungari River.
Intelligence indicates that rail shipments through
Grodekovo may have declined in 1955 to a. level of about 850,000 tons.
These shipments consisted of coal, salt, grain, and foodstuffs shipped.
to Vladivostok, Nakhodka, and Khabarovsk for local consumption or for
shipment to offshore areas. The average value per ton of these ship-
ments is relatively low, and their total value is tentatively placed
at $150 million..
Chinese exports, to the USSR by road and river are
believed to have been small in 1955, totalling about 70,000 tons with a
value of approximately $25 million. Road shipments from.S.inkiang, based
on occasional observer reports and estimated availability of'export
products, are placed at 10,000 tons. These products. are of a relatively
high value per ton, such as. wool, skins, and nonferrous ores, and their
total value is estimated as $15 million. Shipments of timber and agri-
cultural products on the, Sungari River constitute the remainder of this
- 35 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
traffic (perhaps 60,000 tons) and, with a much lower value per ton, may
have been worth about $10 million.
The remaining $690 million.of Chinese overland
exports to they USSR represent rail shipments through Otpor. These exports
included commodities of low to medium value per ton, such as grains and
foodstuffs, pig iron, minerals and ore concentrates, and also products of
a very high value per ton, such as bristles, silk, wool, skins. and hides.
It is estimated that the average value:'of these exports may have been
about $x+oo per ton, so that the total volume of such shipments through
Otpor would have amounted to approximately 1,725,000 tons..
Table 17
Approximate Distribution. of Estimated Overland Exports to USSR,
by Means. of Transport,
1955
Million US $
Thousand
Metric Tons
By Rail through Grodekovo
150
850
By Rail through Otpor
690
1,725
By Sungari River
10
60
By Road from Sinkiang
15
10
865
SMN=
2-16-4,51
2. Trade with the European Satellites (in Terms of Estimated
Actual Origin and Ultimate Destination of Cargoes)
Total Trade
Total trade between Communist China and the European.
Satellites has been estimated for 1955 as.$900 million -- divided about
evenly into $450 million of imports and $450 million of exports.. (See
p. 8, above.) This represented about 600,000 tons of imports. and over
1,500,000 tons of exports -- over three-quarters of which moved by sea
(i.e., 420,000 tons of imports and 1,260,000 tons of exports). Seaborne
tonnages, however, included high proportions of bulky low-value commodities,
so that this seaborne traffic represented only a little over one-third of
the total value of this trade:; -:aftd: the- 22:.:perc-ent of -'thib ~rade"voltime
which moved over d',c(.380, 000-. tons: ~ of imports. ahd.- 295,:000 tons of `, exhorts )
accounted for over 60 percent of its total value.
- 36 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
b. Imports
(1) Seaborne
Analysis of cargo movements indicates that a total of
620,000 metric tons of cargo moved into Communist China by sea from
European Satellite ports but intelligence evidence indicates that about
200,000 tons of this cargo were actually of Western European origin, having
been transshipped through Gdynia to avoid established controls on direct
shipments to Communist China. (see Section II. C 2, b. (2) under Unrecorded
Imports, p. 16 , above). Only 420,000 tons of seaborne Chinese imports from
European ports actually originated from the European Satellites. -
repres'e'nting an estimated value of about $175 million.
Table 18
Communist Chinese Seaborne Imports Originating from European Satellites, 1955
(Estimated from Cargo Information.)
t
Volume
(000 Tons)
Average Value
Per Ton
(US
Value
(Million US
y
Commodi
POL
76
60
4
Iron and Steel
83
170
11+
Nonferrous Metals
11
700
8
'Fertilizer
89
65
6
Chemicals and Drugs
20
800
16
Instruments
5,000
5
Transport Equipment
12
1,250
15
Machinery
20
1,750
35
Machine Tools
1
2,000
2
Foodstuffs
41
200
8
Miscellaneous
4
750
3
Unidentified aJ
62
950
59
420
175
zw~
.
tons of un en i e cargo consists, or the most part, o
residual tonnages remaining after identification of the bulk of the cargo
on individual ships; there are only two ships for which the entire cargo is
unidentified. Although the unidentified cargo is made up of commodities in
roups identified above, it is believed that a greater proportion of this
the
g
unidentified cargo represents machinery and instruments, reflecting'a known
increase in the export of whole industrial plants from the European
Satellites to China.
- 37-
S C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
(2) Overland
The remaining-$275 million of Chinese imports from
the European Satellites are presumed to represent overland rail move
marts. According to Chinese and Satellite press announcements and
other intelligence, these imports. consisted primarily of vehicles and
of machinery and equipment for the industrial plants being constructed
in Communist China by Satellite nations.. It is estimated that the
value of such overland shipments::may have averaged around $1;500 per
ton and represented approximately 180,000 tons of Chinese overland
imports..
c. orts
(1)
Seaborne
Communist China's seaborne. exports to the European
Satellites during 1955 amounted to about 1,260,000 tons. with an estimated
value of $155 million. Of this total, something over 700,000 tons were
delivered directly to Bloc ports. In addition, nearly 550,000 tons of
cargo unloaded in non-Bloc ports (primarily Hamburg and Rijeka) are
estimated to have been transshipped overland or by inland waterways to
destinations in the European Satellites.
- 38
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 19
Total Direct plus Transshipped. Communist Chinese Seaborne Exports
to European Satellites, 1955
(Estimated from. Cargo Information a)
Commodity
Volume
000 Tons)
Average Value
per Ton
(US.$)
Value
(Million US.$)
Iron Ore
668
15
10
Pig Iron
6
50
0.3
Nonferrous Metals and Ores
13
700
9.1
Petroleum Coke
2
25
0.1
Textiles
0.7
7,000
5
Rice and Other Cereals.
89
1l-0
12.4
Soybeans;
278
110
30.6
Peanuts
96
300
28.8.
Other Oilseeds
34
200
6.8
.Other Foodstuffs
36
600
21.6
Industrial Oils
5
350
1.7
Jute
3
225
0.7
Other Agricultural Raw Materials
16
1,250
20
Sulphur
4
35
0.1
Unidentified
850
7.6
1, 260
154.8
a. Of which:
713,000 tons delivered directly to Bloc ports.;
547,000 tons unloaded in non-Bloc parts and transshipped.
b. It is beli d. that t se-exp t:a zstst d primarily of high and medium
value commodities. Chinese exports of lower value are custormarily shipped
in bulk and are relatively easily identified.
(2) Overland
The remaining $295 million of Chinese exports
to the European Satellites are believed to represent overland movements.
Only fragmentary intelligence is available on Chinese overland exports
to the European Satellites, but these would consist of'products having
a very high value per ton, such as bristles, casings, canned foods, and
handicrafts., as well as some lower-valued oilseeds and foodstuffs. It is
estimated that the, average value per ton of such overland exports may have
been around $1,000, so that they would'have represented a total volume of
'about 295,000 tons.
- 39 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
3. Trade with the Far Eastern Satellites
The volume of Communist China's trade with North Korea, North
Vietnam,-and Mongolia during 1955 has been estimated from several announce-
ments of the tonnages involved and from.. general information on the
commodities involved in this trade.. Trade with North Korea was by rail,
with Vietnam both by sea and overland (road and rail), and with Mongolia,
primarily by road.
a. Trade with North. ;Korea
(1) imports
Communist Chinese imports, from North Korea during
1955 consisted of electric power, the value of which may have amounted
to about $10 million, plus. commodities such as minerals, fish, fruits,
and medicines with a value of approximately $15 million. It is estimated
that these total imports represented about 200,000 tons.
(2) Exports
The North Koreans have reported partial lists of 1955
imports from China totalling about 1 million tons. It is believed that
these announcements included the major tonnages involved in an estimated
25 million of Chinese commercial exports: to North Korea and a publicized
90 million of Chinese aid materials. The, total volume of Chinese exports
to North Korea during 1955 is estimated, to have, been about 1,200,000 tons.
b.. Trade with North Vietnam
(1) Imports
Chinese imports from North.-Vietnam are of a relatively
high value per ton, consisting of 'antimony, tin and such agricultural
specialties as cinnamon, tea, coffee:, pepper, hides and bamboo. It is
estimated that the value of these imports during 1955 was about $15
million, representing approximately 20,000 tons..
(2) Exports
During 1955, Communist Chinese aid deliveries and
commercial exports to North Vietnam amounted to about $50 million, con-
listing of military equipment, consumer goods, and foodstuffs. It is
estimated that these exports represented about 60,000 tons. Over half
40
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E;C-*R-E-T
of these shipments. (almost all rice) moved by sea and the balance by
rail or road.
e . Trade with.Mongolia
Communist Chinese. trade with Outer Notigolia in T955
consisted of Chinese imports of horses, agricultural products and
mineral a~tes,, and Chir se exports of conaumer goods -plus the equip-.
nt for several light industrial plants which Cr mrunist China
Oompleted for Outer Mongolia in IM. This traffic waved largely by
trunk and animal caravan. Its value iss, estimated at $15 million in
each direction and its, volume was negligible.
41
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
TV. Transport and Transport Services
A. .Ocean Shipping
The year 1955 again witnessed a substantial increase in the amount
of'merchant shipping: engaged in trade with Communist China.. As in previous
years, non-Bloc tonnage was predominant, -with eighty-one percent of all
merchant shipping arriving in Comm ist China under free world registry,
anal nineteen percent under Soviet, Polish, or Czechoslovakian flag. There
was no activity by the Chinese Communist merchant fleet outside home waters
in 1955 with the exception of a minor amount of commerce with North Vietnam.
There were 1,185 merchant ship-arrivals in Chinese Communist ports
in 1955, totalling nearly 5.5 million 'gross. register toils (GRT), an increase
.of 893.,000 GRT, or nearly 20 percent over 1954. These arrivals represented
an,-estimated cargo-carrying capacity of about 8.2'million long tons. Merchant
ships :of 17 Western '-countries. made 987 individual voyages to Communist China,
accounting for more than 4.4 million.GRT, an increase of 17 percent over the
tonnage of non-Bloc arrivals in 1954.
The following table, which shows the number and'estimated cargo
carrying,: capacity of arrivals, together with the percent of tonnage
represented by non-Bloc registry shipping for 'each .year 1951-1955, is
indicative of'the continuing importance-of Western shipping in China trade:
Table 20
Total Arrivals in Communist China
1951 through 1955
1951
1952
1953
195+
1955
EIC-R-1) (EIC-R1-S2) (EIC-RI-S ) (EIC-R]:-514) (EIC-R1-S5)
2
Number of Arrivals
1,1,x^
532 ~
Cargo-carrying capacity
(thousand of long tons)
3,2141
3,527
5,900
6,800
8,241
Percent of non-Bloc
tonnage
86
81
85
82
81.
he cargo-carry ng;capacty of'oceango cargo ships maybe generally taken as
5'times.the gross register tonnage., and this factor has been used throughout this
report.. In practice, however, the tonnage which.a given. ship can actually carry on.
a particular voyage is affected by the nature of the cargo, the length of the voyage,
the nuwiber of ports visited, and the, proportion of space in the ship allotted to
passenger accommodation. - 42 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
The number of individual arrivals in Chinese ports does not,
however, give. a complete picture of the shipping engaged in trade with
Communist China. Ships arriving in Chinese ports fall into several
categories, for example.: European tramps and liners, Hong Kong traders,
Japanese tramps, other liners. operating, out of Southeast Asia and Africa,
and Bloc ships from the Soviet Far East. These provide rather different
types of service and differ substantially in their pattern of employment.
Vessels operating '.out of Hong Kong and Japan on the relatively short run
to and from the China coast sometimes account for several arrivals
monthly. On the other hand, European tramps and liners must make rela-
tively long-voyages between. Communist China and their home ports, so that
a single trip may last a number of'months.
The average monthly arrival tonnage of allvessels,engaged in
China trade amounted to.l58,00o GRT in 1955. Since 35 percent of"all
arrivals originated in European ports, however, and since ships in the
Sino-European trade are generally employed a .minimum of three months,
the total tonnage involved at any one time in trade with the Communist
Chinese is. much higher. Analysis of the. shipping engaged reveals that in
1955 on any given day, counting ;all ships in .Chinese ports or enroute to
or from China, an average of 916,000 C=RT of shipping was involved in trade
with.Communist China.
About one-half of totalGRT'of"non-Bloc arrivals is represented by
ships trading between Hong Kon.g.or Japan. and the China mainland. Ships
beginning their voyages. from non-Bloc ports in Europe accounted for another
one-third of non Bloc arrivals, with liner service. accounting for most of
the GRT, although the bulk of'cargo was carried by tramps. Most of the
remainder of'non-Bloc arrivals originated in Eastern European'or South
.Asian ports. Voyages.of 'Soviet Bloc shipping :engaged in trade with China
.originated largely in Bloc ports, especially from.Poland and the Soviet
Far East.
A number of ships. under non-Bloc flags were enggaged exclusively in
domestic coastal trade for the Communist Chinese during various periods in
1955 -- and.repre:sent a valuable service not reflected in arrival figures.
(See Section. IV. B. 1, p.52, ff.) It is also important to, note the ship-
building and repair services rendered by non-Bloc shipyards to theSino-
Soviet Bloc merchant marines. Nine new ships were constructed for the
Soviet Bloc by Western yards and put into use on the Far Eastern run, four
more than were contributed. by the Bloc shipbuilders themselves. In. addition
three second-hand vessels procured from the West were placed on the China run.
Repairs on ten Bloc ships engaged in trade with, China were effected or begun
in non-Bloc yards in 1955. These building and repair projects have .not only
'economic but also military significance in that they free Bloc shipbuilders
.of such tasks and make . these. available for naval construction..
-3 -
S-E-C-R-E=T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
.S-E.-C-R-E:~T
2. Non-Bloc 8hippix Review
a. Arrivals
There were 987 arrivals: by non-Bloc merchant ships in 1955,
representing 'a GRT of 4,428,4000 -- in comparison with 8l 6 non-Bloc arrivals
in 1954 with a GRT'of 3,791.)000. This constitutes. an increase of 17 percent
in the number and,GRT of non-Bloc arrivals . in. 1951-. With some minor fluctu-
ationst the over-all monthly arrival tonnage showed a steady increase
throughout the entire year, reaching an'all-time high during November and
December. (See Shipping Graph l.)
Ships of seventeen countries were engaged in the trade. The
flags of the Turkish, Egyptian, South African, Burmese,, and Lebanese merchant
fleets appeared for the first time in 1955. No merchant ships of Panamanian,
or Moroccan registry entered Communist Chinese ports in 195$, whereas in 1954
one Moroccan and 4 Panamanian vessels were engaged in-China trade. British
ohipsaoqguted for 42 percent of the total arrival, tonnages. (52 percent of the
total non-Bloc arrivals) Other. important tonnages were : contributed by
Japanese, Dutch and Norwegian-vessels -- 14, 6, and 5 percent, respectively,
of the, total arrival tonnages. (See Shipping Graph. 2.)
The general, pattern of origin of non-Bloc shipping-:arrivals in
the Chinese trade was relatively little changed in 1955 over 1954, aril is
summarized in the attached graph. (See Shipping Graph 3.) Ships beginning
'their voyages from non-Bloc ports in Europe accounted for the largest single
group of arrivals,.:._annd liner service was the dominant factor in GRT involved.
Regular liner shipping 'services are provided the Chinese Communists by ships
.of eleven non-Bloc commercial steamship lines which make scheduled voyages
from Europe to the Far East) including . calls: at Chinese ports. One hundred-
fifty individual arrivals in Communist China (a,ll but nine on voyages
originating. from Europe) were made by such liners representing a potential
carrying, capacity of close to 1,800,000 long tons These liners, of course,
carry only partial cargoes for China and the principal cargo tonnage from
Western Europe ports to China is handled by non-Bloc tramps chartered by the
Bloc. The major value of the liner service is that it facilitates trade by
assuring to the Chinese a dependable scheduled transport service for prompt
dispatch of small-lot shipments, and sometimes providing deep tanks, refrig-
erated holds and other space for special cargoes.
- 44
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 SECRET Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2 Si i ` n Graph pp ~g 1,
. NON-BLOC
SOVIET BLOC
FI TOTAL
383
-l 369
1951 1952 1953 1954 1955
AVERAGE MONTHLY TOTAL
MERCHANT SHIP ARRIVALS IN COMMUNIST CHINA
1951-1955
DoV
wfQ -
to N N
nm-
M to N
m0N
NUMBER OF SHIPS
a i- OD if) r OD 01 - W Qt M N N iff m- N r- O K)
N0)N Pm - p- f? OD- w co- 0)O-
MAR. APR. MAY JUNE JULY AUG. SEPT. OCT
1955
if)WM moo
m z N m N M
NOV. DEC.
SECRET
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 SECRET
01
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
MERCHANT SHIP ARRIVALS IN COMMUNIST CHINA
BY COUNTRY OF REGISTRY
1955
174 156
34
w
Z
Q
I
N
W
C7
w
I
0
Z
I
N
I-
m
a
F
0
tr
z
0
Z Z
Q 0 Q F Z N
W LL " o I
U_ W d Z F- W
- NON-BLOC
* 106 Arrivals totaling 262,032 GRT were made by ships believed to be beneficially owned by the Chinese Communists.
95 95 73 64
41 19 17 15 14 6 2
26 19 16 10 8 6 3 4 2 2 I I
S.11pp.ng Graph 2
Y DUTCH
I =
U) J W
U) 0 N
a. 0
SECRET
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 SECRET
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
ORIGIN OF MERCHANT SHIP ARRIVALS IN COMMUNIST CHINA Saipp.ng Grapri 3
1954-1955
TOTAL BLOC AND NON-BLOC TONNAGE
1955
BLOC TONNAGE
SECRET
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S -E-C-R E -T
Table 21,
Arrivals in 1955 of European Liners Owned by Eleven Western Companies
.Arrivals
Flad;.
Numer
MT
A. Holt & Co , Liverp6o1
British
22
171.,66o
Peninsular & Oriental Steam
British
12
108,978
Navigation Co., London
Hamburg-Amerika Linie, Hamburg
Germs
3
26,941
Norddeutscher Lloyd:, Bremen
German
3
22,589
Compagnie des Messageries
French
10
74,219
Maritimes Paris
Erostrom, Axel & Son, Gothenburg
Swedish
14
100,927
.Olen Line-, Ltd.. London
British
26
231,238
'Eflerman Lines, Ltd., London
British
11
96,149
Ostasiatiske Ktonpagui A/S Det,
Danish
9
81,601
Copenhagen
Vereenigde' Nederlandsehe
Dutch
26
198.891
Scheepvaartmaatschappii, N. V?,
The Hague
Wilhelmsen, Wilk., Oslo
Norwegian
Ali
93,5
:L! , 1 206,
There were, by comparison, only 53 trips.to China frcm.Western.
Europe made by Bloc-chartered tramps under Western flags, with an average
vessel size per trip of 6,100 GRT. This tramp tonnage. however, carried
'approximately 65 percent ef'the volume of total cargoes. arriving from Western
Europe.. Charter information remains sketchy, but, based upon the pattern
established in recent years, the majority of these tramps were under some
type of charter either to the Chinese Communists or to one of the Satellite
-countries., through such ship chartering agencies, as Sovfracht, Polfracht,
Sinofracht (the official Soviet, Polish,, and Chinese ship-chartering
agencies and such. intermediaries as the Far East Enterprising.Co., Ltd.
of Hong Kong.
- 15 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S.E-C-RE-T
The two other major origins of 'voyages to China were Japan
'and'Hong Kong. A slight. change in the shipping pattern in the Far East
occurred in 1955. The tonnage of 1955 arrivals. from Japan remained at
29 percent of the total non-Bloc arrivals, whereas arrivals from Hong
Kong decreased from 30 percent in 1954 to only 22 percent. This reflects
the fact that Hong Kong trade with China did not share in the general
expansion of Chinese seaborne trade, because of decreased use of 'Hong.
Kong's entrepot services., although it remains a major trading center.
Altogether, non-Bloc Europe, Hong Kong, and Japan account for
83 percent of the origin of arrivals. The remainder originated for the
most part in Eastern European, -or, 8titheast Asian ports A number of smaller
liners were active in trade between Communist China and various African,
Malayan, and Indonesian ports..
Conspicuous by its,absence is any record of `seaborne shipments
of POL to Communist China on non-Bloc ships in 1955.
The unsuccessful
attempt by the Finnish ARUBA to carry jet fuel from Constanta toWhampoa
in early 1955 may have served as a deterrent to similar ventures. This
voyage, chartered by the Far East Enterprising Co., Ltd., the principal
Hong Kong agency used by Communist China for chartering non-Bloc ships,,
was terminated in the eastern Indian Ocean: when the crew refused to take
the, ship into waters where it might be seized by the .Chinese Nationalists.
Shanghai, the Tientsin/TakuBar complex,, Canton/Whampoa,
Tsingtao,, and Dairen (in that order) continued to serve as the main parts
of entry for shipping. Shanghai received the bulk of the traffic. Besides
Chinwangtao, Chefoo, Swatow, Foochow, and Hoihow, considerable activity was
.also 'evident in the port of Yulin on Hainan Island where large amounts,of
iron ore were loaded. Many ships : carrying. cargoes to Whampoa from Europe
made their return voyages. via Yulin to load cargoes of iron ore for Western
Europe and the Satellites..
b. Departures
In. 1955 there were 991 departures of non-Bloc vessels from
Communist Chinese ports totalling 4,1+69,000 GRT, an increase of about 20
percent from the 1954 figures of 830 departures totalling 3,702,000 GRT.
(See Shipping Graph. 4.)
-46
S E=C-R=E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 SECRET
0 NOW BLOC
SOVIET BLOC
^ TOTAL
rm
co
rm-
-
N m 00 -T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
MERCHANT SHIP DEPARTURES FROM COMMUNIST CHINA
1955 618
rar
rm-
NUMBER OF SHIPS
N N 0 r- w It co
I- co- r m0
AUG.
co in r
mm
r h W
r m -
cc - N
Sh,ppin Graph 4
0 RI 19
p N N
M m t0
com -
AVERAGE
MONTHLY
TOTAL
SECRET
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 SECRET
JAPAN
14%
THONG KONG
1954
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
DESTINATION OF MERCHANT SHIP DEPARTURES
FROM COMMUNIST CHINA
1954-1955
TOTAL BLOC AND NON-BLOC TONNAGE
HONG KONG
20%
JAPAN
20%
HONG KONG
250/0 N
Al
PAN
4 24%
::'.'.':^ ?'1
'.
POLAN
28%
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Shipping Graph 5
NON-BLOC TONNAGE
19% OF TOTAL
SECRET
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
The pattern of destinations of voyages from China
corresponded closely to that of the origin of arrivals. Hong Kong
:continued to receive more GRT from China than did Japan (1,122,000
GRT as compared with 1,100,000 GRT) even though there was a sharp
increase in the proportionate share of departures for Japan. (See
Shipping Graph 5.) Departures for Japan increased from 14 percent
to 20 percent of the total and ordinarily carried relatively full
cargoes in contrast to arrivals from Japan'which were to. a very
great extent in ballast.
3. .Bloc Ship p Review
a. Arrivals
In 1955, there were 198 Soviet Bloc arrivals in Communist
China, representing a total of 1,066,000 GRT, This was an increase of
40 percent in. the number, and 32 percent in the total GRT of Bloc
arrivals over the previous year,. though they still contributed only 19
percent of the GRT of all arrivals -- about the same proportion as in
1953 and 1954. Of these Bloc arrivals 135 (664,ooo GRT) were by
Soviet ships.; 55 (357,000 GRT) by Polish ships; and the remaining 8
(45,000 GRT) by Czechoslovakian ships
There was a. noticeable change in the 1955 pattern of
arrivals as compared with that of 1954, reflecting a sharp increase of
tankers from Europe which unloaded POL in the Soviet Far East before
proceeding in ballast to China to pick up return cargoes. Thus. 59 per-
cent of the total tonnage of 1955 Bloc arrivals from China was from the
Soviet Far East as compared with 48 percent in 1954.. (See Shipping Graph 3,
r91.p. 44 above.) Although the GRT'e of Bloc arrivals from all other areas
were little changed from 1954, they represented a smaller proportion of "the
increased total. Thus arrivals from Poland represented only 26 percent
of 'the total in 1955 as compared with 31 percent in 1954 and the proportion
of arrivals from other European ports 7 percent as compared with 13 percent.
The proportion of arrivals from other Asian ports remained at about 8
percent.
- 47 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
The Changing Pattern of Soviet Bloc Arrivals
1954-55
1254
000
Percent of
Total Arrival
Arriving from
aer
N
GRT
GRT
Soviet Far East
85
389
48
Poland
44
254
31
Other Europe
16
103
13
Other Asia
13
64
8
Total
1.58
810
100
1955 .
Number
000
GRT
Percent of
Total Arrival
GRT
122
624
59
43
280
26
15
71
7
18
91
8
198
14.066
100
b. Departures
There were 198.departures of Bloc ships from Communist China in
1955 (1,042,000 GRT) compared with 156 (805,000 GRT) in 1954. Only 39 percent
of Bloc merchant ship departures were destined for the Soviet Far East, in
contrast with the 59 percent of Bloc arrivals-which came from that area. Of
the total tonnage, 28 percent were bound for Poland and 14 percent for the
.Black Sea. Soviet tankers, which usually called in North China to pick up
soya beans after delivering.POL to the Soviet Far East, constituted the
major portion of this 14 percent. The remaining 19 percent of Bloc
departures were for various Asian and. Western European ports..
c. Routes Employed
(1) General
In general, Bloc vessels continued in 1955 to avoid waters
within range of Chinese Nationalist naval patrols based on Taiwan, and did
not traverse the Formosa Straits, the traditional commercial shipping channel
from the South China.Sea to North China ports. Polish ships have not called
in North China ports since the'seizure of the Soviet tanker TUAPSE in June
1954, and ships of Soviet registry normally proceed south of Sumatra and East
of the Philippines direct to the Soviet Far East, prior to calling in North
China ports.. Only 6 Bloc vessels, all of Soviet registry, arrived in North
China directly from Europe via the East China Sea in 1955 (all in April) --
- 48 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
1 tanker, the VOLGA DON (7)961 GRT) which made a wide-detour via Soviet
Far Eastern waters, and 5 freighters (totalling 10,912'GRT). The
remainder of Bloc arrivals from Europe were ships of Polish and Czech
.registry which called only at Whampoa in South China before proceeding to
Yulin,, on Hainan Island, to load iron ore for their return voyages to
Poland.'
(2) Tanker Voyages from the Black Sea
Despite the continued avoidance of North China ports by
Bloc tankers since the TtJAPSE incident, there was a major expansion in
1955 of total Bloc. tanker arrivals in the Soviet Far East and China taken
together. It is clear that much of the POL tonnage unloaded in the Soviet
Far East was then transshipped overland to China. Soviet tankers operating
between the Black Sea and Soviet Far Eastern ports have, since the seizure
of the?TTJAPSE in June 1954, followed the route south of the Philippines proceeding normally via the Sunda Strait, Java Sea, Makassar Strait, and
Celebes Sea -- and are then believed to have transited the Ryukyu chain
north of Amami Oshima, and thence passed through the'Tsushima Strait. On
their return voyages the tankers usually called in North China ports to load
soya beans before proceeding to Europe.
The following is a breakdown of POL tanker shipments from the
Black Sea to China and the Soviet Far East for the years 1952-55.
POL Tanker Shipments to Soviet Far East and Communist China
1952-55
Thousand Tons
Estimate for
'Year
To Soviet
Far East
To Communist
China
Total
1952
20
15
35
1953
22
9
31
1954
81
99
180
1955
428
57
485
- 49 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
This marked increase in total Soviet tanker, traffic to the
Far East has been made possible by the rapidly growing number of USSR
tankers available. The USSR tanker-building program first began to show
real results late in 1953. Twenty-five KAZBEK (LENINGRAD) class tankers
had been added to the Soviet tanker fleet by early 1956. Of the 4+3 voyages
by Soviet tankers from the Black Sea to the Soviet Far East in 1955, 38 were
made by KAZBEK (LENINGRAD) class tankers. In addition, Polish tankers made
a total of six voyages to the South China port of Whampoa in 1955, carrying
over 45,000 tons of POL; and (as noted above) one Soviet tanker proceeded
directly to North China from the Black Sea.
All POL shipments from the Black Sea area to the Communist
Far East must move in Bloc tankers since non-Bloc tankers are not made
available for trade with that part of the world. In 1955 there were 53
arrivals of Soviet and Satellite tankers in the Far East with a total of
slightly over 500,000 tons of POL, representing most of the overseas
employment of the Bloc tanker fleet in that year. Other overseas trips of
the Bloc tanker fleet in 1955 included only 3 deliveries totalling 30,000 tons
to East Germany, 2 totalling 20,000 tons to the Soviet expedition in the
Antarctic and 12 totalling 125,000 tons to Free World ports (of'which more
than half was for Egypt). Nearly all of the 5,000,000 tons total of Bloc
exports from the Black Sea to the Free World, as well as 375,000 tons in
intra European-Bloc trade, moved in non-Bloc tankers chartered for that
purpose. This availability of Free World charter tonnage to handle Bloc
petroleum trade with other areas enables the Bloc to allocate a significant
portion of its:own tanker tonnage for movements to the Far East.
It. Utilization of Capacity of Shipping Engaged in Communist China's
Seaborne Trade
In the following tabulation the estimated cargo tonnages of
Communist China's seaborne imports and exports.'are compared with the calculated
cargo-carrying capacities of vessels arriving and departing -- by type of
shipping and in accordance with major areas of origin and destination. All
eaargo.figures are based on known cargoes plus an allowance (determined from
trade patterns or by pro-rating from cargo information) for other arrivals
on which specific cargo information was not available.
- 50 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S E-C-RE-T
Table 24'
Utilization of Shipping Capacity Involved in Communist Chinese Seaborne Trade
1955
Percent of
Capacity
Cargo Carried Cargo Capacity J Employed
ARRIVALS:
From Non-Bloc Ports:
From Hong Kong
140,.000
1,430,000
10
From Japan
From Western Europe:
199,000
1,941,000
10
Non-Bloc Liner Service
200,000
1,6o8,ooo
12
Non-Bloc Tramp Tonnage
400,000
532,000
75
Bloc Tonnage
17,000
617,000
20,000
2,160,000
89
29
All Other Ports
From.Bloc Ports:
290,000
,
942,000
31
From Soviet Far East
22,500
944,000
2
From Europe
630,000
749,000
84
From North Vietnam
nil
66,ooo
DEPARTURES:
To Non-Bloc Porte:
To Hong Kong
139,000
1,683,000
8
To Japan.
1,221,000
1,656,ooo
74
To Western Europe:
Non-Bloc Liner Service
305,000
1,514,000
20
Non-Bloc Tramp Tonnage
555,000
793,000
70
Bloc Tonnage
64,000
924,000
81,ooo.
2,388,000
79
39
All Other Ports
161,000
790,000
20
To Bloc Ports:
To Soviet Far East
422,000
611.,ooo
69
To Europe
887,000
1,189,000
75
To North Vietnam
35,000
55,000
64
` lows on next page.
- 51 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 21+
Utilization of Shipping Capacity Involved in Communist Chinese Seaborne Trade
1955
(Continued)
a/ Cargo figures generally are reported as metric tons whereas cargo-carrying
capacity is based on long tons. The figures above have not, however, been
converted to a common basis, as the difference between the metric ton and
along ton is only 1.6 percent, and the comparison is, in any event, only
a. rough indication of the percent of potential capacity actually utilized.
B. Assistance to the. Sino-Soviet Bloc by Non-Bloc Shipping and Shipping
;Services
1. Significance of Non-Bloc Shipping in the China Trade
The overseas trade of Communist China is transported entir
e c nt ships of non-Chinese registry, with the.exception of
amount of trade in Chinese Communist vessels between south China a
North Vietnam. Although increasing gradually in terms of both quantity and
quality, the Chinese Communist merchant fleet remains old, slow, and
inadequate even for Chinese coastal requirements.. For all practical purposes
it is inactive in overseas trade. Of the twenty-four Polish ships on the
Baltic-China run, however, indications are that approximately one-half may
be effectively controlled, if not owned, by the Chinese Communists.
Shipping services provided by non-Bloc vessels (81 percent of the
total tonnage of arrivals) include both chartered tramps and scheduled
liners. While chartered shipping: carries the bulk of the cargo in this
trade, liner services are of more importance than the volume of cargo
carried might suggest; i.e., since they provide regularity of shipments
which enables the Chinese Communists to engage space and to move smaller
lots of import and export cargoes promptly, without having to await chartering
arrangements.
A number of ships, mainly of British registry, engaged in trade
between Hong Kong. and the mainland also provide domestic coastwise services
along the entire China coast. In addition nine British-flag ships operated
intermittently along the China coast for extended periods without touching
- 52 -
6-E-C-Ft E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S E-C-R-E-T
anon-Communist port~as an important augmentation'of'Chinese Communist
coastal shipping services. One ship, the NORTHERN GLOW, was committed
to this activity during the entire year, and another, the SNOWDON HILL,
was coastal during the last nine months of the year. The other seven
were active in the same service for Red China during various months.
(See Shipping Graph 6.) In the Chekiang-Fukien coastal area opposite
Taiwan non-Bloc coastal services are far more important than movements
in Chinese vessels. This area has been notably lacking in rail facilities,
and local Chinese ports and installations would be difficult to supply
adequately except for the availability of non-Bloc shipping along this
coast.
A number of non-Chinese flag ships are owned by Hong Kong
registered Chinese firms whose members are known to be Communists or
Communist sympathizers. It is.believed that this may be a subterfuge and
only a nominal cloak for actual Chinese Communist ownership. Such vessels
include the NORTHERN GLOW, SNOWDON HILL, ADMIRAL HARDY, HONG KONG 'TRADER,
HONG KONG BREEZE,. SHUN LEE,. TA:ICHUNGSHAITT, and DORINTHIA. The EDENDAI,E,
sunk by the Chinese Nationalists in January, 1955 was also under similar
ownership arrangements.
For the most part non-Bloc. merchant ships transport only the so-
called non-strategic commodities in the Chinese trade. While this service
in itself is of great importance to the Chinese, significance is added by
the fact that under such conditions Bloc vessels are released to transport
embargoed items to China. Bloc vessels. continually carry strategic goods
from Gdynia, Poland,. as well as rubber from Ceylon, to Communist China.
Thus non-Bloc shipping; either directly or indirectly continues to
make a significant contribution to the logistics support of 'Communist
Chinese transport requirements. Despite an increase in the number and
tonnage of Soviet and Polish merchant vessels in the China. trade during
1955, these combined fleets alone are unable, of themselves, to meet
adequately the over-all transportation requirements of the Communist
Bloc. It is. necessary for the Bloc to charter several hundred Western-
flag:ships each year, a substantial portion of which are employed in the
China trade. While Free World controls have apparently of embargoed strategic materials to Communist China in COCOM-country shipment
no restrictions prevent the export to the Chinese Communists of 'increasing,
amounts :of shipping services which indirectly assist Bloc movements of
strategic goods. Without the benefit of Free World shipping Sino-Soviet
transportation and distribution facilities -- already heavily committed --
would face increasing difficulties.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
NON-BLOC MERCHANT SHIPS IN CHINESE COMMUNIST COASTAL') TRADE - 1955
SHIP
FLAG
GRT.
NORTHERN GLOW*
BR
5135
SNOWDON HILL*
BR
7939
DORINTHIA*
BR
3599
HELIKON
BR
2151
GROSVENOR MARINER
BR
3197
INCHARRAN
BR
3539
TAI SEUN HONG
BR
2605
INCH WELLS
BR
1896
INCHJURA
BR
4651
TOTAL GRT/MONTH (in thousands)
NO. SHIPS/MONTH
YEARLY TOTAL: GRT. - - - - - - 169
(in thousands)
NO. SHIPS - - - 33
yipping Graph 6
JAN. FEB. MAR. APR.
MAY JUNE
JULY
AUG.
SEPT OCT
NOV.
DEC.
2 2 2 4
13
13 17
Only those vessels which are engaged exclusively in trade among Communist Chinese ports throughout a given month are considered to
have been coastal during that month.
* Believed.to be Chinese Communist beneficially owned.
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S E -C -R -E -T
2. Bunkering
Free World controls on bunkering of merchant vessels involved in
trade with Communist China are maintained by the United States, the United
Kingdom, France, and Japan. Under these control procedures, bunker
supplies for merchant ships.enroute to Communist China are denied by the
above countries when avessel is known to be transporting. unauthorized
strategic commodities. The United Kingdom, France, and Japan authorize
bunkers for non-Bloc vessels transporting controlled goods to China when
such shipment has been licensed for export to China by a country partici-
pating in the COCOM/CHINCOM organizations. The United States, however,
considers each bunker application on its own merits, according to the
circumstances prevailing at the time of application. Thus, even though a
particular strategic cargo carried had been duly licensed by a COCOM country
and obtaineda CHINCOM exception, the United States may deny and has denied
bunkering applications of the vessel concerned.
The major difference between United States bunker controls and those
of the other three countries is that only those of 'the United States provide
for a review of bunker applications for ships returning from Communist China.
Consequently, most Bloc vessels avoid bunkering from British, United States,
or French supplies enroute to China, but bunker without restriction at
Singapore on the return trip.
An important difference in the application of'controls as between the
US and UK is that which permitted the WERGUS, on a China-bound journey in
1955 for delivery to.new Communist Chinese owners, to receive bunkers by UK
stations although the US considered the WERGUS a "strategic commodity" in
itself and would have denied bunkers. It later developed that the cargo of
this vessel, originally described as sugar,. actually also included a
consignment of ball bearings to the Chinese Communists. This information
was not available, however, at the time the ship was bunkered at Aden and
Singapore -- illustrating another difficulty in applying bunkering -controls.
In 1955 the port of Djakarta in Indonesia has increasingly assumed
importance as a bunkering point for Bloc vessels en.route to China. Bloc
vessels, to which bunkers were either denied or limited at Singapore,,
regularly proceeded to Djakarta where they received unlimited supplies for
continuing their voyages to China. In February 1956, moreover, the Soviet
freighter IVAN POLZUNOV (7176 GRT) called at Aden, and although she had
sufficient fuel on board to make her next port-of-call (Rangoon), she
requested and received an additional 1,000 tons from British Shell as she
had not declared for a Communist Chinese port. After unloading at Rangoon,
however, she proceeded to the Malacca Straits where she refueled the SERGEI
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
S E-C-R-E-T
KIROV (7176 GRT) which had been denied bunkers at Singapore because of
the strategic nature of 'her cargo for China. Although not itself a direct
violation of bunkering controls, this development opens-another avenue for
organized Bloc circumvention of 'controls.
Another type of 'evasion of bunkering controls was illustrated in.
February 1956 when the Soviet freighter NOVOROSSISK (7176 GRT) arrived at
Colombo to load 7800 tons of rubber for Communist China. Upon arrival
this vessel requested and received 500. tons,of bunkers from a Ceylonese
subsidiary of British Shell. Although requested by the 135 to intervene,
the British Government declined to interfere with what it considered a
Ceylonese affair.
The present system of limited bunker controls cannot be expected to
effectively prevent the movement of strategic materials to Communist China.
It is believed, however, that present controls -- despite violations,
circumventions and countermeasures -- have produced a considerable
uncertainty and inconvenience for the Bloc.
3. Non-Bloc Deliveries of Fkrchant Ships to the Sinn-Soviet Bloc
The Sino:-Soviet Bloc has been able to considerably alleviate the
limitations of its own international transportation facilities by the
acqui.s.ition.of new and second-hand merchant ships from non-Bloc countries,
by availi;ng themselves of ship repair facilities in Western shipyards for
the major overhaul and reconstruction of Bloc ships, and by extensive
chartering of Western merchant. ships. Moreover, the availability to the
Bloc of Western, shipping and services has made possible the allocation of
Soviet and Polish merchant ships to the Baltic/Black Sea-China,route, for
the movement of highly strategic materials and equipment.
Ding 1955,. 26 newly constructed merchant ships totalling .62,000
GRT (including seven tankers totalling 13,000 GRT) were delivered to the
Sino-Soviet Bloc from Western shipyards.. (See Table 25, I, page 56,
following.) This figure compares 'with 195+ deliveries (revised from
page 106, EIC-RI-S4) of 19 ships with a total GRT of 55,000 tons, an
increase of'about 15 percent. 1/ Three of these ships totalling 7,000
GRT were constructed in Finland for Chinese Communist account. The
remainder, most of which were. also built in Finland, were for Soviet
account. Six of these Western-built ships, totalling 17,000 GRT, have
a eared in the China trade.
1 These figures exclude a considerable construction of smaller vessels,
under 13000 GRT each, and 8-fish factories from Western Germany, of
about 2,550 GRT each, which also represented an important supplement
to Soviet shipbuilding facilities.
55
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-004008000200070005-2
S-E-C-R-E-T
During 1955 four second-hand ships totalling 2+,000 GRTwere sold
to Poland by Western shipowners. (See Table 25, IT, page 57.) Three of these
ships totalling 20,000 GRT have been used on the China run.
W-. Non-Bloc Repairs to Soviet Bloc Vessels
During.1955, 27 Soviet, Polish, Rumanian, and Czechoslovakian
merchant ships were repaired in West European and Japanese shipyards.
(See Table 25, III, page 58.) In the majority of cases, these transactions
represented.exteuded repairs of one month's duration or longer. During
the year,. repairs were completed on two Soviet ships which had been in an
Italian shipyard for 14 and 19 months respectively. Although in these two
cases the long lay-up provided the Soviet with an excellent base from which
to observe Italian shipbuilding and NATO operations,. such repairs on Bloc
ships in Western shipyards also represent an important supplement to Bloc
construction and repair facilities which are utilized primarily for the
construction and repair of combatant naval vessels. Repairs to Bloc merchant
ships in non-Bloc shipyards,as recorded above,,represented a 55 percent
decrease in the number of ships. repaired, compared with 1954.
Table 25
Ships and Services Acquired by the Soviet Bloc
from the West during.1955
I. Deliveries to Soviet Bloc of. New Ships_, from West European Shipyards,
From
Belgium U.S.S.R.
Footnotes follow on page 59.
',,Total Total
GRT Ships G~ RT__
NIKOIAI OSTROVSKX .1, 849
NIKOLAI CHERNYSHEVSKI 1,.849 2 3,698
ISKRA
DROGOBITZ
SEVE1 NAJA DVINA
ELBAN
BASHKIRNEFT
NEFTEGORSK
BALTIJSK
IKING
ZAPADNAJA DVINA
.KANDA
JUSHNIJ BUG
-. 56T
S-E-C-R-E-T
Tkr. .1,178
Tkr. 3,259 J
2,491
Tkr. 1,178'J
Tkr. 1,178
Tkr. 3,420
5,454
Tkr. 10178
2,491
Tkr. 1,178
2,300 11 25,305
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
.S-E=C-R-E-T
Table 25 (Cont'd)
Ships and Services Acquired. by the Soviet Bloc
from the West during 1955
Deliveries to Soviet Bloc of'New Ships, from west European Shipyards,
Finland Coimnunist
China ROSA
RENATA
RITA
Total
GRT Ships
2,31i.5
2,345
2,3+5 3 7,035
Denmark U.S.S.R. 1WRIGERATOR NO. 9 1,680
REFRIGERATOR NO. 10 1,571
REFRIGERATOR NO. 11 1,571
REFRIGERATOR'NO. 12 1,680
w Ge TT S s
rman
Total
61502
y . . .R. DANA Reefer 33712 1 3:782
Netherlands U.S.S.R. SVETLOGORSK Reefer 3,550
CHERNIAKHOVSK Reefer 3;,550:2/
BALTIJSK Reefer 3,553 2
ZELENOGORSK Reefer 3,550 14,203
Sweden U.S.S.R. KUSTONAJ Reefer 1,755 1 1,755
TOTAL 26 62,280
TI, Soviet Bloc Purchases..Second-Hand Ships from Western Europe
New Name Bloc Registry Former Name Former Registry GRT
RONALD TRAUGUTT :.Polish ANNAM
MALGORZATA FORNALSKA Polish; GIUSEPPE.CANEPA
PAWEL FINDER .Polish LUCE'NDRO
Polish LADY BOURDILLON
Footnotes follow on page 59 .
TOTAL
Danish
Italian
Swiss
Frt. 6,726 c/
Frt. 8,396
Frt. 40924 /
British Dredge 3,,99
4 ships
- 57 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
24, oko
GRT
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 25 (Cont'd)
Ships and Services Acquired by the Soviet Bloc
from the West during 1955
III. Soviet Bloc. Merchant Ships Repaired in Non-Blot Yards, 1955
Coutr_
.Flag
Belgium TOBRUK Pol.
HIL Pol.
BATORY Pal.
KOSCIUSZKO Pol.
Period under Repair
7,07+9 21 Mar. 55 - 19 JulY 554c/
1,076 30 May 55 - 15 July 55
11,287 9 Sep. 55 - 18 'Sep. 55 21
7,707 26 Sep. 55 - 13 Oct. 55 J
Subtotal 7+ ships
Britain ALEXANDER
SOVOROV USSR
WROCLAW Pol.
ENISEI USSR
JONIS RAINIS USSR
ARCRANGELSK USSR
GDYNIA Pol.
KALININGRAD USSR
REGA Twlr Pol.
7,176 16 Apr.. 55 - 13 May 55
1, 77+0 18 May 55 6 July' 55
2,205 25 May 55 11 July 55
7+,177 2 June 55 - 29 July 55
5,660 8 June 55 - 27 July 55:1
3,818 8 July 55 - 22 July 55
6,067 10 July 55 - 16 Aug. 55
613 6 Oct. 55 - 20 Oct. 55
Subtotal 8 ships
W. Germany TAMBOV USSR
TUNGUS USSR
EDWARD
DEMBOWSKI Pol.
NARWIK Pol.
WARSZAWA Pol.
JULIUS FUCIK Czech
MIKOLAJ REJ Pol.
2,,902 6 Nov. 57+ - 24 May 55
7,197+ 13 Dec. 57+ - 18 Apr 55
7+,750 25 Feb. 55 - 30 Mar. 55 21
7,065 28 Feb. 55 - 29 Apr. 55 e/
6,021 9 Mar. 55 - 8 Apr 55 /
5,17+3 16 June 55 - 14 July 55 ~f
6,517+ 28 Dec. 55 .J
Subtotal 7 ships
Footnotes follow on page 59.
- 58 -
S-E-C-R-E-T
30,119
3]2>56
39,589
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Table 25 (Cont'd)
Ships and'Services Acquired by the Soviet Bloc
from the West during 1955
III. Soviet Bloc Merchant Ships Repaired in Non-Bloc Yards, 1955 (Continued)
Cow y Name F lag GRT Period under Repair
Italy DIMITRI
POZEARSKI USSR 6,267 1 Dec. 53 .5'July 55
DEJNEV USSR 3,578 24 Feb. 54 - 14 May .55
Subtotal :2 ships 91845,
Netherlands ASKOLD USSR 7,176 24 June 55 - 12 July 55
Subtotal 1 ship 7,176
Norway IRTISH USSR 2,300 8 June 55 - 30 Oct. 55
Subtotal 1 ship 2"300
Portugal VTORAYA.
PYATILETKA USSR 5,757 2h' :Mar ? 55 - 16 June 55
Subtotal 1 ship 5,757
Yugoslavia TRANSILVANIA Roum. 6,672 9 Dec. 55
(Arr. 12.9.55)
Subtotal 1 ship 6,72
Japan ZIRIANIN USSR 6,476 14 June 55
DNESTR USSR 3,580 18 June 55 -
Subtotal 2 ships 10,056
TOTAL 27 ships 142970
Excluding 8 fish factories from Western Germany-of about 2,550 GRT each and vessels
under 1,000 GRT "each.
Involved in Far East POL movements.
Involved in China trade.
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E -C -R-E-T
C. Interior Transport Connections for Communist China's Foreign Trade
1. Interior Transport Connections Utilized During 1955
The railroads continued to be the most significant interior transport
connections utilized in Communist China's international trade. Well over 95
percent of the total tonnage of international trade over interior routes
crossed the border by rail in 1955. Rail service was available between
Communist China and the USSR, North Korea, Kowloon (Hong Kong), and North
Vietnam. Very little of China's foreign trade moved by road. In areas where
no railroads were available, however, trade moved over roads, and in certain
other areas roads were used as a minor complement to railroads which moved
the bulk of the trade. Accordingly, small amounts of trade moved by Vietnam,
between China and'North Korea, the USSR, Kowloon (Hong Kong), North Burma and India. An important though still relatively small amount of trade
moved between China and the USSR by way of the Sungari River. Air transpor-
tation was significant in China's foreign trade only for priority shipments
.of'relatively high-value, low-volume strategic and essential materials, and
for movement of key personnel. Although traffic by air did not represent
a commercially significant tonnage during 1955, such service was available
between China and the USSR, North Korea and North Vietnam..
2. Significant Developments During 1955 and Early 1956
During 1955 few major changes have occurred in the pattern of use or
availability of interior transport routes connecting Communist China with her
neighbors.. The most notable changes. occurred in Sino-Soviet and Sino-Viet
Minh transport relations, as a result of the completion of the Trans-Mongolian
railroad-across Inner Mongolia and the Hanoi-Nam Quan railroad in North
Vietnam. Although the former was not opened to through international traffic
during 1955, its availability signifies an appreciable increase in the
capability of transport to support Communist China's foreign commerce through
Siberia. The Nam Quan railroad, on the other hand, became the principal
transport route for conveying the increasing volume of Chinese aid to North
Vietnam. The completion,of the railroad from Hanoi to Kunming in southwest
China (planned for 1956) will provide another route for Sino-Viet Minh
traffic, although its primary use probably will be to facilitate the export
of yunnans,mineral resources through the ocean terminal of Haiphong.
a. Railroads
(1) USSR
The appreciable increase in capability to carry foreign trade
between.the USSR and Communist China which accompanied completion of the
-60-
S-E- C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
S-E-C-R-E-T
TO RE INSERTED
Map I
"Communist China; Railroads and Selected Roads"
(In final printed copy only)
60a
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-00400R000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Trans-Mongolian railroad constituted the major development affectipg:Sino
Soviet transport connections since 1951+. While basically completed before
the. end of '1955, the line was nevertheless not opened for "through" inter-
national traffic until January 1956,Meanwhile further improvements were
made, including extension of'the liner as Soviet broad gauge to Chining,
Inner Mongolia, where it meets the Chinese standard-gauge system. More-
over, during 1955 an efficient signal system was installed and yard
facilities at Chinirig were expanded and equipped for around-the-clock
transloadingoperation. As a result of these improvements the potential of
the Trans-Mongolian, railroad for use in international trade may be greater
than has previously been estimated.
Concurrently, Communist China has been improving lower
capacity rail lines approaching Chining, and additions of sidings and second
tracks on other lines in'North China arealso&provided for in current
investment plans -- efforts indicative of the role envisioned for the Trans-
Mongolian railroad in Sino-Soviet trade.
(2) North Vietnam
By early 1956 the transport system of'North Vietnam, dis-
organized and severely damaged during the civil war, had been substantially
restored. and in some.respects improved. Construction of the strategic rail-
road from Hanoi to, the border town of'Nan Quan (where it meets the Chinese
line from Ping;hs.iang)received primary emphasis,. to facilitate the movement
ande.distribution of increasing material aid from China. With Chinese
Communist equipment and technical assistance, the.Pin;g- siang line was being
used to carry Sino-Viet Minh-traffic soon. after its completion in February
19551, although it was only officially opened to through international traffic
in,August 1955.
Capability of the Ping hsiang line, limited in the previous
estimate by insufficient locomotives and. rolling stock, has. increased
substantially since the Viet Minh acquired the railroad equipment left by
the French. A further increase in capability could be expected, moreover,
if the line were converted from the. present meter gauge to Chinese standard
.gauge as reported to be planned for early completion.. The. use of Chinese
equipment then possible as far south as Hanoi could negate any present
limitation imposed by an. inadequate Viet Minh locomotive and rolling stock
park..and by transloading problems.
Reconstruction of the railroad from Hanoi to. Kunming in
Yunnan, on which track laying was completed to. Lao Kay in. the border area in
April 1956, will further enhance transport capability between North Vietnam
and Communist China.. It may, in fact, be of greatest importance to the
S-E-C-:R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Chinese. Fulfillment of plans to restore the partially dismantled section
between Lao Kay and Kunming in 1956 would facilitate the exploitation of
Southwest China's mineral resources, which could then be transshipped
through Haiphong instead of being hauled long distances overland to
consuming and export centers in China.
Improvements in the capabilities of some of the roads connecting
Communist China with neighboring, countries occurred during 1955. In North
Vietnam main road links with China and with the. connecting network in the
Tonkin. delta (the only significant transport connections with China in 1954)
received considerable attention. Their importance to foreign commerce,
however, has not been so critical since restoration of the Hanoi-Nam Quan
railroad in February 1955.
The capability to transport foreign trade between Communist China
and Burma also was appreciably increased by improvement of the Chinese side
of the Kunming-Talo road in 1955. The Burma Road, however, continued to be
the main interior connection between the countries, carrying commodities
reported to include Chinese exports of 150 tons of brick tea. and imports of
2,500 bales of Burmese cotton for Yunnan's spinning mills.
Between India (via Tibet) and China;, improvement of the route
from Lhasa south to.Gangtok progressed to Phari-Dzong. The volume of foreign
trade via this route, however, remained negligible during 1955-
c Inland Waterway
The use and capability of the Sungari River, the only significant
waterway connection available for Communist China's foreign trade, has
remained substantially unchanged since 1951. For the first time, however,
river cargoes of 'machinery from the USSR and of timber, soya beans and coal
from China have been observed moving on the Sungari. Soviet tankers,
previously noticed in Sino-Soviet trade, continued to transport POL from
Khabarovsk to Chiamussu on ' the. Sungari, via the Amur River.
The only significant developments in air transport since 195+
have been the recent establishment of civil air services between Communist
China and Burma and between Communist China and North Vietnam. International
air flights provided at present between these areas are very few.
-62-
S-E-C.-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
APPENDIX
A. The Value and Direction of Trade
In the past, (EIC-R1 and its
supplements 1 througti 4) were able to arrive at relatively firm
conclusions as to the value and volume of Communist China's trade
with the Free World and as to the volume of its seaborne trade with
the Bloc. Direct intelligence on the value of China's trade with
the Bloc and.on the volume of its overland trade with the Bloc has
been limited, however, and.estimates of these have necessarily
contained a larger margin of error. Chinese Communist official trade
and budget announcements have been utilized in attempting to arrive
at estimates, but the data announced have proven obscure -- expressed
usually in terms of percentages and percentage changes, never adequately
defined, and often difficult to reconcile. In consequence, intelligence
interpretations of these official data have varied considerably from
year to year, and it is believed useful at this time to again review
such earlier estimates of the value and distribution of annual Chinese
trade.
In 195+ the Chinese Communists reported the value of their foreign
trade at 8.487 billion yuan (about $3.45 billion), thus providing the
first specific indication since 1950 of the absolute value of their
over-all foreign trade. This value was considerably higher than had
previously been estimated, and suggested, contrary to former
conclusions, that Communist China's foreign trade in recent years has
not been in balance, but has involved substantial annual import
surpluses -- primarily as a result of deliveries of goods (of which
some part was military) financed under unpublicized special Soviet
loans or grants, in addition to normal commercial trade.
In 1950 the Chinese Communists had given considerably, more specific
information on the value of their foreign trade than has since been
available. Official data for that year, allegedly from customs returns,
showed a detailed percentage breakdown of imports and exports b country
and by commodity, which was quite consistent with the (adjusted trade
returns of non-Communist countries. Other Chinese Communist announce-
ments as to the dollar value of their exports in 1950 placed total 1950
trade at $1,082 million (see EIC-Rl-Sl, pp. 12-13), Later indexes,
however, suggest a higher actual level of trade in 1950. One such
index (published in a balance of payments analysis and apparently in
terms of rubles or dollars) placed 195+ trade at 261 percent of the
1950 level, which figuring backwards would suggest a value of 1950
- 63 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
trade of $1,320 million. Another index, apparently in terms of yuan,
placed 1953 trade at 181 percent of the 1950 level, suggesting a value
for 1950 trade of $1,310 million. Data issued in conjunction with this
latter index also placed the proportion of Bloc trade in 1950 at 33
percent of the total, whereas the earlier customs data had shown this
as 26 percent. Since the customs data clearly did not include all
imports -- in particular not including allmilitary imports -- it seems
possible that the earlier trade data on 1950 may have subsequently been
revised upwards to allow for some of the Bloc's 1950 deliveries of .
military or other special assistance to-Communist China, on a loan or
grant basis.
The value of Chinese foreign trade in other years may be computed.
from certain summary statements in recent Chinese Communist announce-
ments, giving annual percentage changes in over-all trade:
1. 1955 trade increased 30 percent over 1954 trade.
2. 1954 trade increased 405 percent over 1953 trade.
3? 1953 trade increased 36 percent over 1952 trade.
4. 1953 trade increased 81 percent over 1950 trade.
All of these percentage figures have been announced since August,
1954, and appear for the most part to have reflected final rather than
preliminary-trade statistics. These more recent Chinese percentage
announcements appear to have been based on the yuan value of trade
(as in the case of the 1955 announcement on the absolute value of 1954
trade), rather than on more stable US dollar or ruble measures. No
recent percentage announcement has been made as to the increase in
Chinese trade from 1950 to 1951. LAn earlier announcement had claimed
that total trade in 1951 was double that of 1950; but from the timing
of 'the announcement this increase appears to have been related to the
original customs valuation for total trade in 1950 of $1,082 million,
rather than to the revised 1950 trade figure of 4,486 million yuan
($1,310 million)?
In 1956 the Chinese Communists published a table showing the
proportions of their trade with Bloc countries and with the Free
World from 1950 through 1953. For 1954 and 1955 comparable figures
have been included below on the basis of other independent Chinese
announcements (see page 6. EIC-RI-S5, above).
- 64 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
Table 26
Percentage Distribution. of Chinese Trade, 1950-55
In Percent of 'Total Trade
1950
1921
1952
1953
1954
1955
USSR
30.89
48.72
57.34
56.34
53.0
55.3
European Satellites
1.99
13.24
19.02
16.58
20.0
20.0
Fat Eastern Satellites
0.6
1.32
1.72
2.52
7.0
5.2
Free World
66.52
36.72
21.92
24.51
20.0
19.5
These various data provide the basis for the following over-all
estimate of Chinese trade and the distribution of this trade between
the Bloc and the Free World, from 1950 through 1955:
Table 27
Estimated Foreign Trade of Communist China
1950-55
Million US .$
1950
1951
1952
1953
1954
1955
Sino-Soviet Bloc Trade:
USSR
405
1,055
1,630
1,860
1,830
2,480
European Satellites
25
285
540
545
690
900
Fes' Eastern Satellites
10
30
_-__50
85
21+0
230
Subtotal
440
1,370
2,220
2,490
2,760
3,610
Free World Trade:
870
795
620
810
690
875
Total Trade
310
165
2
2
,84o
3z450
4,485
1
,
.
- 65 -
S-E-C-R-E-T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-G R E-T
The division of total trade as between imports and exports remains
uncertain. The Chinese Communists claimed an export surplus for 1950 on
the basis of customs figures, admitted a substantial import surplus in
1951, and in subsequent years have described their trade as "substantially"
in balance. It is believed, however, that there has been a substantial
excess of imports in every year, including 1950, partly because intelligence
suggests that exports have not been sufficient to have achieved a near
balance of trade at the high levels, claimed, and. partly because recent
Chinese Communist budgets have suggested that unpublicized. Soviet loans or
grants have been made to the Chinese annually, for special purposes.
Separate figures for total imports and exports can therefore be estimated
only very approximately,, as follows:
Table 28
Estimated Value of Communist Chinese Imports and Exports
1950-55
Year
Imports
Exports
Total
1950
745
565
1,310
1951
1,265
900
2,-165
1952
1,54o
1,300
2,84o
1953
1,800
1,500
3,300
1954
1,950
1,500
3,.450
1955
2,485
2,.000
.4,485
B. The Composition of Commlan.ist Ching-, s g Imports, 1953-55
Available intelligence does not permit an accurate estimate of aver-all
Chinese imports by well-defined categories; overland imports from the Soviet
Bloc, which have accounted for the bulk of the value of total imports, are
particularly difficult to quantify. The composition of imports appears to
have altered significantly under the Communists, who have restricted
imports of consumer goods in favor of capital goods and industrial raw
materials. Only a general summary of over-all Chinese import composition
over a three=year period can be presented, based largely on Communist
announcements. The following estimate of the general pattern of imports
is based on Chinese statements of their import requirements under the
First Five Year Plan; on Chinese statements regarding consumer goods
imports, on Chinese announcements of materials imported under special
loans or grants from the USSR, and on estimated quantities of certain
essential raw-material bulk imports (large parts of which have been
imported from the Free World).
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C R-E-T
Communist China's total imports during 1953-55, the first three years
of the Five Year Plan, have averaged about $2.1 billion annually. Their
composition has been roughly estimated as follows, in terms of very broad
commodity categories:
(1) The Chinese Communists have made a number of general statements
regarding their import requirements for basic construction projects under
the current Five Year Plan. According to these announcements, funds for
the purchase of machinery and equipment comprise 38 percent of the total
investment program (-I2,7l+0,000,000 Yuan) for basic construction projects
over the period of the Five Year Plan. The Chinese plan to supply 60
percent of the necessary equipment from internal production, and to
import, 40 percent.. This would amount to an import, over the five-year
period, averaging $525 million annually for machinery and. equipment for
basic construction projects -- although the value of actual deliveries
in any one year cannot be determined from available intelligence.
(2) The Chinese have announced that imports of capital goods and
other means of production accounted for 88.5 percent of total imports
in 195+ and for Y?over 90 percent" of imports in 1955 (probably
including military equipment). Reports from observers in China indicate
a general scarcity of imported consumer goods under the Communists,
tending to confirm the Communist statements regarding restriction of
consumer goods imports. It is.estimated, therefore, that consumer goods
imports have probably averaged about 10 percent of total imports during
the past three years, or about $225 million annually.
(3) From various intelligence reports, it is.estimated that the
Chinese have been. importing certain essential raw materials and supplies
at rates totalling about $400 million annually; vi_: rubber, $60 million;
petroleum products, $60 million; drugs and. chemicals, $120 million;
cotton, $75 million; and other essential raw materials, $85 million.
(4) The remaining $950 million represents other imports reported
only in general terms by the Chinese. included in this category would be
vehicles, metals,- agricultural and other machinery (not included under the
basic construction program referred to above) and miscellaneous raw
materials. Also included would be deliveries of military end-items - a
.large part of which were under special loan from the USSR, as indicated
.specifically in the Chinese budget report for 1955 and. the Chinese
acquisition of other materials and facilities under special loan, such as
assets of the former Sino-Soviet Joint Stock Companies.
- 67 -
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
SE-C R-E-T
The breakdown of average annual Chinese imports over the first three
years of the Five Year Plan (1953-55) may thus be summarized in very
general fashion as follows:
Million US
Equipment for basic construction projects
525
(as programmed by the Chinese)
Consumer goods
225
Essential raw materials and supplies
400
All other imports (including imports under
950
special loans)
2
C.. Communist China's Exports
Mainland China's exports have traditionally consisted of foodstuffs
and raw materials. After the Chinese Communists achieved power and
established civil order and a stabilized currency, exports rose.sharply
from the low levels of 1946-49. Chinese Communist data show exports
.rising from about $215 million in the first half of 1950, to about $350
million in the second half of the year. It is estimated that exports
had reached an annual level of $1.5 billion by 1953 and 1954, representing
(taking account of increased prices) approximately the 1928 volume.
The Chinese Communists reported their 1950 exports in some detail,
and since 1950 have made fragmentary reports on individual export
commodities which provide an indication of the developing over-all
pattern of exports, which are estimated approximately as follows for
1950, 1953, and 1955:
- 68 -
S E=C -R E -T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
Commodity Composition of Communist Chinese Exports
1950, 1953, and 1955
Million US
1950
1953 .
1955
Cereals, oils; seeds
210
600
600
Textile fibers, products
80
150
200
Animal products
130
300
400
Miscellaneous vegetable
products
65
250
350
Coal, metals, minerals
30
100
150
Other commercial exports
50
100
18o
Aid program to North Korea,
and North Vietnam
120
565
1
500
2
Exports of cereals, oils, and seeds in 1950, on the basis of the
Chinese Communist export returns, are estimated to have included nearly
1,000,000 tons of beans and cereals, 80,000 tons of vegetable oils, and
several hundred thousand tons of peanuts and other oilseeds and seed-cake.
These exports increased rapidly, reaching a peak in 1953; the Chinese
Communists reported total exports during 1950-53 of 6,200,000 tons of
beans and cereals and 988,000 tons of vegetable oils. With the develop-
ment of domestic shortages, the government promised to stabilize exports
of beans and cereals at 1,750,000 tons in 195+ and 1955, and to reduce
vegetable oil exports from the high 1953 level. The 195+ exports in
this category probably were reduced from 1953, but with the good crops
reported for 1955 and the continuing evidence of restricted domestic
consumption, it seems likely that 1955 exports recovered to at least
the 1953 level.
The major items in the announced 1950 exports of.textile fibers and
products were $23 million of raw wool, $10 million of raw silk,; $8 million
of wool carpets, and $8 million of embroideries. The exports in these
categories are believed to have greatly increased, with the improvement of
interior transport and the better organization of these trades.. Wool
exports reportedly doubled between 1950 and 195+,, while reports of silk
69 -
S -E.-C -R-E -T
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
 Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2
S-E-C-R-E-T
and silk product exports. suggest that these reached a $225 million total
for 1950-54 (an annual average of $45 million), and $75 million in 1955.
The principal animal products. exported in 1950 included $38 million
of pig bristles, $27 million of eggsf $13 million of live hogs, and $12
million of furs and skins. The Chinese Communists have particularly
expanded their export of meat and eggs. Reports of the purchasing power
of exports in terms of import commodities place the exports of frozen
pork in.10 1/2 months of 1954 at $62.5 million and planned 1954 exports
of canned meat.at $10 million; and it is estimated that exports of live
animals for food and meat exceeded $100 million in 1954 and $120 million
in..1955. From official reports of the proportionof egg production
exported,, egg exports are estimated at about $70 million in 1951..
Miscellaneous vegetable products include a wide range of food produce
exported mainly to Hong Kong, Macao, and Southeast Asia, as well as some
major specialty items such as tea and tobacco. Official trade data
placed tea exports in 1950 at $19 million and suggest that total tea
exports during 1950-54 may have totalled. 1110 million.. It appears that
tea exports have been. increasing rapidly in recent years,. however, and
may have reached a level of about $50 million in 1955. Tobacco exports,
negligible in 1950, have been greatly expanded, reaching about 42,000 tons
.valued at possibly $50 million in 1953 according to Chinese. Communist
production and trade data..
Exports of coal, metals, and minerals have also expanded, largely
to China's Bloc partners. It is believed that expanded production of
nonferrous ores (such as tin, tungsten, and antimony) probably enabled
exports of $100 million of these items in 1955. In addition, Communist
China has exported over 500,000 tons of iron ore annually in recent years,
as well as.substantial amounts of pig irony which is in surplus because
of an unbalanced relationship between Communist China's present iron and
steel plants
Other exports have included a wide variety of industrial manufactures
and handicraft products. Although exports of light industrial manu-
factu_res.have been increasing in recent years (particularly to under-
developed countries of South and South East Asia), they are relatively
small, Chinese Communist data placing 1954 exports at about $60 million
and. 1:955 exports at about $75 million-
- 70
Approved For Release 2006/08/14: CIA-RDP82-0040OR000200070005-2