COMMUNIST INSURGENCY IN MALAYSIA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001100130038-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 19
• Document Creation Date: December 21, 2016
• Document Release Date: November 18, 2008
• Sequence Number: 38
• Publication Date: February 22, 1972
• Content Type: IM

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DIRECTORATE OF
INTELLIGENCE
Intelligence Memorandum
Communist Insurgency in Malaysia
CIA
DOCUMENT SERVICES BRANCH Secret 87
FILE COPY 22 7_
DO NOT DESTROY No. 0839/72
19
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CENTRAL INTELLIGENCE AGENCY
Directorate of intelligence
22 February 1972
INTELLIGENCE MEMORANDUM
Communist Insurgency in Malaysia
Introduction
year ago the Malay-controlled Razak govern-
ment negotiated a delicate return to open politi-
cal life ending 21 months of emergency rule imposed
after the race riots of 1969. It did so with
greater finesse and ease than almost anyone, the
government included, expected. The predominant
government party, the rejuvenated United Malay Na-
tional Organization, has managed to recapture, at
least temporarily, its disaffected Malay constitu-
ency without adopting extreme pro-Malay policies
which would have seriously increased the le-,.1 of
Chinese alienation. The government is so defensive
about its Chinese constituency, however, that it
has not published 1970 census results which report-
edly show the Chinese catching up to the Malays in
population growth and accounting for 42 percent of
the population compared to the Malays' 48 percent.
Much of the government's political opposition comes
from Chinese, but they are hamstrung by exten!,ive
government restrictions on political debate and
activity. Although the government has by no means
solved the basic Malaysian communal dilemma, it may
have succeeded in buying the country several years
of much-needed political stability and moderation.
Stability in the future may be threatened by
the gradual resurgence of the Malayan Communist
Party, an organization largely composed of and
Note: This memorandum was prepared by the Office of
Current InteZZigence and coordinated within CIA.
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supported by indigenous Chinese. The party launched
a moderately successful terrorist campaign during
the British rule of Malaya in mid-1948 with some
5,000 to 6,000 guerrillas. To meet the threat, the
United Kingdom banned the party, declared a state of
emergency which lasted until the independent Malaya
terminated it in 1960, poured in thousands of troops
and, with active Malayan public and official support,
broke the back of the movement by the end of 1954.
In that year, the Communist political apparatus and
all principal military units moved to safehavens
across the Thai border. Small Communist units left
behind continued resistance for a few years, but by
1960 no armed Communist groups of any consequence
remained. Forces in southern Thailand were consoli-
dated into a hard core of some 600 armed members,
virtually all of them ethnic Chinese.
In 1968 the Communists decided to move out of
their Thai sanctuaries and rebuild insurgent bases
on Malaysian soil. Within three years they managed
to emplace an estimated 200-300 armed guerrillas
south of the border. Despite this progress, the in-
surgents face an uphill struggle in re-establishing
themselves in West Malaysia. If they are to become
a serious security threat, they must develop an ex-
tensive network of support areas, and to do this
they must win over or intimidate substantial numbers
of people. There is no evidence of a significant
increase in active popular support for the guerrillas,
but there are signs that support is being resumed in
areas of former strength. Arms would also be a prob-
lem. Short of a major eruption of communal violence
the Communists' ability to develop large-scale sus-
tained guerrilla operations seems doubtful.
Whatever its prospects, the renewal of the Com-
munist insurgency comes at 2n awkward time for the
government. If the Communists succeed in moving
Malaysia into a second insurgent "Emergency," the
resulting drain on Kuala Lumpur's limited material
and leadership resources will seriously hinder the
country's economic and political development. An
invigorated insurgency that is heavily dependent on
support from the Chinese community will further com-
plicate the government's efforts tc construct a
workable communal relationship between the Malay and
Chinese populations.
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Thai Sanctuary and a Second Try
1. The reappearance of a fledging insurgent
operation in West Malaysia after over ten years of
quiet has raised questions concerning Kuala Lumpur's
ability to protect itself against Communist subver-
sion and guerrilla action. The government's per-
formance in the past two years has not been totally
satisfactory. The British never completely elimi-
nated the party itself and over time, it has been
able to build a foundation for renewed subversive
and military activity from sanctuaries just across
the border.
2. Since the Communists' combat element, the
Malayan National Liberation Army (commonly known as
CTs or the Communist Terrorist Organization) moved
into Thailand during the 1950s, it has reorganized
and grown in numbers and influence within its base
area. From some 600 members, it has grown to an
estimated 1,500-1,700 men armed primarily with an
assortment of locally obtained World War II small
arms and rifles. This force is supported by an
auxilia:y Malayan Communist Youth League numbering
about 3,000 young men who have received ideological
and paramilitary training. About 100,060 people
live in the Communist area, and many regularly pay
taxes to the Communist organization.
3. The party could not maintain and enhance
its insurgent capability without this Thai sanctu-
ary, which the Thai have not and the Malaysians
cannot disrupt significantly. Although the Thai
have been somewhat more cooperative in the past two
years, Bangkok simply is not seriously concerned
over an insurgency in a remote part of the country
and not targeted directly against Thailand? This
remains true despite increased cooperation between
the Malayan Communists and Thai Communist insurgents
operating nearby. Bangkok's attitude toward the
Malaysian Communists has also been affected by sep-
aratist sentiment among Thai Muslims of Malay ex-
traction, the largest ethnic group in the border
areas. Despite Malaysian assurances to the con-
trary, the Thai fear that Kuala Lumpur has irreden-
tist aspirations and is not above exploiting sep-
aratist feeling in the southern border provinces.
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West Malaysia: Areas of Communist Insurgent Operations
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These suspicions have limited the effectiveness of
Thai-Malaysian cooperation against the insurgents.
4. The two governments hold joint border com-
mittee meetings regularly and occasionally conduct
joint operations. These 25X1
have not een very rewar ing because of Thai foot-
dragging. Despite an agreement permitting Malaysian
"hot pursuit" into Thailand, the Thai are reluctant
to see unilateral Malaysian military operations on
Thai soil. Given this attitude, a rugged border
area that is almost impossible to seal, and a resi-
due of sympathy for the Communists among the border
peoples, Malaysia must live with a relatively se-
cure guerrilla base of operations across its border
for the foreseeable future. This means that the
Commu.n"'ist insurgent threat cannot be erased, only
contained. IL also means that the return of the
insurgents to Malaysia was almost inevitable.
5.I the
Malayan Co=unist Party appea,:s to have decided in
June 1968 to return to armed struggle in West Malay-
sia. This change of tactics may have been partially
inspired by th4 influence of China's Cultural Revo-
lution militancy within the party. The Communists
must also have judged that their insurgent for::;e
was at last reauy for an effort south of the border.
The outbreak of communal rioting in Kuala Lumpur a
year later and the Malaysian Government's subsequent
difficulties almost certainly helped solidify the
pa:: ty's resolve to undertake it ?s long-planned but
perilous return to Malaysia.
6. Small groups of insurgents were reported
crossing the border in 1969. Much of this initial
activity appeared to be ~:econnaissance and training.
As time went by, larger groups crossed into Malay-
sia, sta
first co
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nfirmati
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insurge
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late 197
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7. There are good reasons why the initial Com-
munist effort was directed against Perak and Kedah.
These were previous Communist strongholds and con-
tain a rely:cively high density of rural Chinese.
Insurgents in these areas are thus renewing contact
with old supporters, enlisting new ones, and in gen-
eral attempting to gain the active or passive coop-
eration of the local population. Up to now they have
carefully refrained from direct intimidation or ter-
rorism against the locals. The Communists appear
to be concentrating on recruiting new personnel to
be sent for training in Thailand, preparing the
ground for additional armed groups, and caching
food supplies. Concealed stockpiling suggests that
the Communists have learned from experience and are
aware that the government broke the back of the ear-
lier insurrection by resettlement programs which
denied Communist access to food supplies in sympa-
thetic villages. In this preparatory period, the
Communists are doing everything they can to avoid
contact with government security forces. With the
exception of ambushes near the border carried out
by Thai-based insurgents, government forces have
started all fire fights and other contacts during
the past year.
8. The insurgents have enjoyed some initial
success in their effort to rebuild a mass support
and logistic apparatus. Kuala Lumpur has had to
accept the fact that the insurgents have been re-
ceiving some degree of support from t4_ght-lipped
rural Chinese in Perak and Kedah. Government se-
curity forces so far have obtained little useful
information on insurgent activities from the local
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9. The government is even more concerned over
Communist efforts to gain support among the Malay
population. For most of its history, the Malayan
Communist Party has been almost exclusively Chinese,
both in terms of the ethnic composition of its lead-
ership and support and the party's strong pro-Peking
ideological stance. During the past few years, how-
ever, the party has been making a considerable ef-
fort to recruit Muslims of Malay extraction in south-
ern Thailand--an indication that it realizes it must
broaden its appeal if the revolution is ever to take
hold in Malaysia. Its efforts to attract Malay sup-
port in West Malaysia are currently centered in
Kelantan, a heavily Malay area.
10. The present degree of communal polariza-
tion in Malaysia, however, poses a tremendous ob-
stacle to these efforts. The average Malay, for
religious and cultural reasons, resists Communist
blandishments, especially if the enticers are
closely associated with Chinese interests. Given
the more outwardly Malay character of the present
Malaysian Government and the greater expectations
it has generated within the Malay community, there
appears to be relatively little reason at present
for Malays to turn toward the Communists. The party
has attracted Malays on the Thai side of the border
by playing on their separatist sentimeihts and numer-
ous grievances against an indifferent government in
Ban kok .
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Government Countermeasures: Identifying the Problem
12. Last September the government mounted a
counterinsurgency campaign in the states of Perak
and Kedah. This effort has been characterized by
large-scale military operations which have proved
for the most art useless and in some cases counter-
Rroductive.
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14. The need to gain local information leads
directly'to the core of the Malaysian insurgent
problem--the government's relationship with the
rural Chinese. The post-election race riots of
1969 and succeeding events presumably have made it
easier for the Communists to proselytize these people.
The roots of the problem, however, run far deeper.
In fact the 1969 racial disorders, the subsequent
restriction of parliamentary democracy, and the
emergence of a more outwardly Malay government in
Kuala Lumpur probably had relatively little impact
in upper Perak and Kedah--areas where the rural
Chinese have long been disaffected, chauvinistic,
and largely unassimilated.
15. The resettlement between 3.950 and 1952 of
more than 400,000 people, mostly rural Chinese, into
defended compounds known as "new villages" was highly
successful in separating communist insurgents from
sou:cces of food and information, but it reinforced
the Chinese population's alienation from the govern-
ment. With rusted remnants of barbed wire still in
evidence and their reputation for disloyalty intact,
the "new villages" in Perak and _Cedah today present
a dismal picture. The term "new village" has become
cruelly misleading in the face of almost complete
government neglect, particularly over the past ten
years. In recent years, declining prices for rubber,
the principal source of income in the area, have
accelerated the process of alienation. Still, the
greatest source of disaffection among the rural
Chinese is the problem of land tenure. Large numbers
of rural Chinese were moved into new villages with
the expectation that they would be given the op-
portunity to gain title to surrounding state-owned
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land. This, however, has not taken place to any
significant degree. In practice, discrimination
and administrative red tape within the various
state governments of West Malaysia have denied the
Chinese the land. Instead most are working land
illegally or by right of temporary occupation li-
censes granted by the state governments.
16. Tho problem of alienation in the rural
areas of northern West Malaysia has been compounded
by the generally low caliber of central government
administration in the countryside. Because of the
communal polarization and because well-qualified
administrators are scarce, the central government
has largely lost touch with many rural Chinese.
17. The renewal of Communist insurgency has,
at least, had one positive effect. The government
has been made aware of the gulf between it and the
rural Chinese. The'underlying social and economic
reasons for disaffection in rural areas were frankly
discussed in a government white paper on the in-
surgency issued last October, and Kuala Lumpur is
now beginning to react. It is trying to take a
broader approach to counterinsurgency. Administra-
tors have been ordered to prepare a full survey of
the long-neglected problems and needs of the new
villages. "Chinese affairs" officers, tasked with
explaining government policy and serving as Kuala
Lumpur's eyes and ears, are being appointed in many
districts. Most important, the government is starting
to expedite the acquisition of land by the rural
Chinese.
18. At the same time, the government is de-
termined to improve security in the countryside.
Curfews remain in insurgent areas, fences are going
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up around some villages, various schemes f,uch as
rationing and production quotas have bee:i put in
effect to deny food to the insurgents, and the gov-
ernmerit is doing a lot of blunt talking. Such
measures run the risk of further alienating the
new villages, but the government believes that first
and foremost it must demonstrate its ability to pro-
tect the people and its determination to move against
the insurgents.
East Malaysia: A Containable Problem
19. The government's counterinsurgency effort
in West Malaysia is being affected by the Communist-
led insurgency in the East. During the past year
insurgents of the Sarawak Communist Organization
(the name applied to various Communist guerrilla
and front organizations in Sarawak) have become more
aggressive, stepping up ambushes against security
forces and assassinations of government officials
and suspected informants. The movement, with some
600-1,100 insurgents, gathered enough steam over
the past year to goad the government into action.
Since last summer a large-scale combined military-
civilian security operation has been under way in
the Third Division of Sarawak. It has drained off
large numbers of Malaysian Special Branch officers
badly needed in West Malaysia.
20. There is no known connection between the
Sarawak insurgents, spawned during the Indonesian
anti-Malaysia campaign of 1963-1966, and the Com-
munist Party of Malaya. To a large degree, however,
the circumstances surrounding insurgency in East
Malaysia closely resemble those in the western wing
of the country. The problem in Sarawak, as in the
West, is still basically the alienation of the Chi-
nese. Malays are heavily outnumbered by both the
Chinese and tribal peoples. The disaffection of the
rural Chinese can again be blamed on an indifferent
state government, land tenure problems, and the lack
of an effective government administration in the
countryside. Sarawakian Chinese in particular re-
sent the sudden Malay political domination imposed
after the formation of Malaysia in 1963.
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21. The Sarawak insurgents are poorly armed
and trained, and, in this respect, the problem of
containing them is less difficult than in West
Malaysia. The Communist insurgent organization in
Sarawak, however, enjoys some advantages. It suc-
cessfully recruits among the Ibans, the largest of
the non-Malay tribal groups, who chiefly inhabit
rural areas. How many is uncertain, but the num-
bers have obviously been slowly growing over the
years. In their areas of operation, the insurgents
seem to have considerable public support, based on
either sympathy or intimidation, among both Chinese
and Ibans. Although their former safehaven across
the border in Indonesia is no longer available,
there are areas within Sarawak to which the insur-
gents can safely retreat.
22. Communist strength in Sarawak is believed
to remain fairly constant, with new recruits re-
placing those killed or captured. The government
recently did seize the initiative from the terrorists
and has demonstrated its ability to contain the in-
surgents.
A Quiet Period Ahead in the West
23,
e communists estimate that the
insurgency will have to remain in a developmental
stage for another two years, during which time the
insurgents will be carefully avoiding military ac-
tion, building up food and supply caches, and fully
developing a support system within the local pop-
ulation. There is indeed very little, if any, real
fighting taking place in West Malaysia and now is
obviously the time for the government to blunt the
Communists' effort before they can marshal the re-
sources for a costly, destructive, and lengthy in-
surrection.
24. Communist strategy has led the party to
turn its back on some rather enticing targets and
the chance to make headlines. For example, insur-
gents are known to be active within 20 miles of
Butterworth Air Base
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25. The insurgent timetable could always be
speeded up by external factors, such as dramatic
Communist victories in Indochina and Thailand or
by the extension of significant material assistance
from North Vietnam or China. External help, how-
ever, is something that the party has had to do
without for most of its history, and the insurgents
can hardly be sure of such assistance in the future.
26. The historically close relationship be-
tween the Malayan and the Chinese Communists is a
matter of record. A nucleus of select Malayan
Communists has functioned in Peking for years, and
an organization known as the Malayan National Lib-
eration League headed by Malayan Communists has
been there since 1966. A strong radio station,
"The Voice of the Malayan Revolution" has been
operating since November 1969 from South China, and
its initial broadcast was an announcement that the
station's purpose was to "prepare-for the launching
of an extensive people's war in Malaya." It can be
assumed that the Chinese were aware in advance of
the 1968 call to arms. Communication between the
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Malayan Communists and Peking presumably is by
courier and may be infrequent. Despite the combina-
tion of a close bond, liaison, and strong propaganda
support, there is no evidence that Peking or any
other Communist party has supplied funds or arms to
the Communist Party of Malaya. Its decision to re-
turn to active insurgency should not be significantly
affected by Peking's current emphasis on peaceful.
coexistence and conventional diplomacy, and Kuala
Lumpur almost certainly does not count on eliminating
the insurgent threat through diplomatic action.
27. Although there is likely to be no quick or
easy solution for the Communist insurgency now de-
veloping in West Malaysia, neither is there cause
for deep pessimism at this stage. Under any cir-
cumstances the insurgents face an uphill struggle.
The Malaysian Army's jungle operations have provided
useful training for a force that could increase in
proficiency as time goes by. Furthermore, Kuala
Lumpur is fully aware of the need to quash the in-
surgency in its early stages and is determined to
do so. Progress has been made in
population denial schemes, and other
recut ve measures. The insurgents have lost the
initial advantage of surprise and must be feeling
the pressure'. So far they appear not to have spread
out of the base areas established as much as a year
ago and, as far as is known, have not significantly
increased the number of insurgents operating in West
Malaysia.
28. The Communists also face the problem of
arms supply. Insurgents in southern Thailand and
on the border are well-armed for the present level
of activity, mostly with World War II weapons, arms
captured from the Malaysian military, and a small
number purchased in Thailand. Without foreign as-
sistance, however, it seems unlikely that the ter-
rorists could acquire the large quantities of arms
needed to initiate relatively extensive operations.
29. The Communist Party's prospects probably
hinge not so much on its own limited insurgent
capabilities as on the reaction of the rural Chi-
nese to future Malaysian political and communal
developments. With Communist insurgents back in
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place, rural Malaysians are being asked to make a
choice that many would probably prefer to avoid.
No one suggests that significant numbers of Chinese
are disaffected or desperate enough to defect to
the Communists. On the other hand, many Chinese
see little reason to cooperate enthusiastically
with the government; such a noncommittal attitude
may be all the Communists need to acquire and main-
tain a foothold.
30. How energetic and successful will Kuala
Lumpur be in giving these people a greater sense
of identity with the government? A perception of
the problem and good intentions are not enough by
themselves. A key indicator will be whether the
government proves willing and able to better the
lot of the rural Chinese by allocating significant
resources under the Second Malaysian Plan, a de-
velopment scheme primarily designed to increase
the Malay share of the nation's economic pie.
31. The real moment of truth may be as much
as two years away. By that time the insurgency's
developmental phase probably will have run its
course. The Razak government appears to have
bought itself a period of stability in which it
can work to ameliorate, if not to solve, Malaysia's
basic communal dilemma. During this period the
government must satisfy its demanding Malay con-
stituency and somehow at the same time provide
Malaysian Chinese with meaningful political, eco-
nomic, and cultural rights. If the government
fails in this precarious balancing act the likely
results will be the emergence of a more chauvinistic
Malay leadership in Kuala Lumpur and a dangerous
rise in the level of communal tension, an atmosphere
in short made to order for the growth of the Com-
munist insurgency.
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