SITUATION SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91T01172R000200020003-6
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: December 21, 2016
• Document Release Date: February 6, 2009
• Sequence Number: 3
• Publication Date: January 21, 1955
• Content Type: SUMMARY

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TOP SECRET %//////
21 January 1955
Copy No.
SITUATION SUMMARY
TOP SECRET
late: 71510,
A+itk.: HR 70.2
Flo Change in class.
19
E] Declassified
c'laM Changed To: TS S
loeuhent No. --- -_-------_
-----
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
State Department review
completed
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Page
China . . . . . . . . . . . . . . . . . . . . . . . . . . .
Offshore islands
Indochina . . . . . . . . . . . . . . . . . . . . . . . . . .
Possible intensification of fighting in northern Laos
General . . . . . . . . . . . . . . . . . . . . . . .
Increased petroleum exports from Soviet Bloc
East Germany . . . . . . . . .
Further security measures
Poland . . . . . . . . . . .
Reported release of political prisoners
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. . . . . . . . . . 5 25X1
USSR . . . . . . . . M . . . . . . . . . . .
Campaign against West German rearmament
Atom offer
Possible strains in Soviet "collective leadership"
Clarification of line on heavy industrial development
Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Communist activities
21 January 1955
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Offshore islands /Refer to map on next page.7: On 18 January, in
a well-coordinated amphibious operation, Chinese Communist forces esti-
mated at a reinforced regiment and two battalions captured Ichiang,
garrisoned by 1,000 Nationalist guerrillas. This operation was preceded
by air attacks against Ichiang and the Tachens and by a concentrated
barrage from Communist-held Toumen Island and from naval vessels.
The Communists are expected to follow their capture of the island
with further assaults on the Tachen group. The loss of Ichiang, the
Communist ability to cut Nationalist supply lines, and the withdrawal
of the Nationalist Navy to Nanchishan, have materially increased the
vulnerability of all islands in the group. The Nationalist Navy is now
planning to supply the Tachens during hours of darkness, using ISM's.
Communist artillery fire from Ichiang could reach both Upper and Lower
Tachen and could be used to bring added pressure against Nationalist
supply efforts and to support a Communist assault on the Tachens.
On 19 January newly-emplaced artillery on two nearby islets re-
portedly was firing on the Tachens. Continued Chinese Communist air
assaults, in conjunction with artillery fire from neighboring islands,
will make Nationalist resupply operations extremely difficult, and the
Tachens may become untenable.
Communist intentions to attack other islands in the vicinity of
the Tachens in the near future are indicated by the presence of Com-
munist ships near Pishan and Yushan (respectively, about 35 miles
southwest and 35 miles northwest of the Tachens). Pishan, held by
about 1,500 Nationalist guerrillas, was shelled by Communist artil-
lery and naval craft on 18 January. Either or both of these islands
could easily be captured by the Communists.
The Nationalist Defense Ministry believes that military operations
near the Quemoys will soon be intensified in order to divert Nationalist
forces from the Tachen area.
21 January 1955
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Possible intensification of fighting in northern Laos: The Laotian
Government's planned response to current Pathet Lao attacks in Sam Neua
Province could result in the outbreak of intensified hostilities in northern
Laos, according to the US Legation in Vientiane. The Laotian Minister of
Defense is dispatching several battalions to Sam Neua's southern boundary,
with the intention of advancing into the province in the event of further
attacks. The Minister informed the Legation that government forces now in
the province are outnumbered about six to one by Pathet Lao troops.
Sporadic Pathet Lao attacks have occurred over the past several
months in the two northern provinces. The present attacks in Sam Neua
Province began on 13 January and are reported to involve more than 1,200
Pathet Lao troops. They represent the Communists' strongest effort to
date to prevent the consolidation of royal government control in the
north.
The Legation comments that one favorable effect of these attacks is
that they have apparently dissipated some dangerous illusions entertained
by Laotian government officials regarding the Pathet Lao.
21 January 1955
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Increased troleum exports from Soviet Bloc: During 1954, the
Soviet B oc--inc uding the Eastern Zone of Austria--exported nearly
6,000,000 metric tons of petroleum and petroleum products to non-:
Communist countries, more than twice the level of such exports in 1953.
Most of the increase was in deliveries from the Soviet Union which
totaled almost 2,700,000 tons in 1954 compared to 500,000 tons in 1953.
Moreover, the volume of petroleum commitments in trade agreements al-
ready concluded with Western countries suggests a further substantial
expansion in exports this year.
These larger petroleum shipments reflect an effort to expand total
exports in order to pay for increased imports from non-Communist coun-
tries. Because of a drastic reduction in traditional grain exports to
the West in 1953 and 1954, the Soviet Bloc has had to rely to an increas-
ing extent on deliveries of petroleum and precious metals to support its
trade expansion program.
At present levels, shipments to the West of petroleum and petroleum
products represent about eight per cent of total Bloc production but
less than three per cent of world petroleum trade. The Bloc has be-
come a leading supplier, however, to la few non-Communist countries, in-
cluding Finland, Iceland, and Egypt.
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East Germany
Additional security measures reportedly have been instituted recently
and civilian personnel, including large numbers of volunteers.
Further security measures: In the past week, East German authori-
ties have intensified controls at 14 major crossing points between East
and West Berlin and at elevated train stations. All identification docu-
ments and baggage, as well as vehicles, are now being checked thoroughly
except during rush hours, when spot checking is employed. The customs
and police guards on the borders are being augmented by military, security,
it ti
along Vast Germany's borders with Czechoslovakia and Poland.
tightening of security measures around Berlin.
y
ing the establishment of a national army in the GDR and by the Stea
ments was continuing on 'tile zech frontier in the vicinity of Varnsdorf
and Jirikov, while an irnconfirmed West German press report states that
both sides of the German-Polish border have been declared'a prohibited
zone. A mixed East German-Polish Commission reportedly inspected the
frontier zone and its security arrangements on 12 and 19 December 1954.
Tighter security measures on the Czech and Polish frontiers may in-
dicate an increased effort to prevent refugees from Czechoslovakia and
Poland from reaching West Berlin and to close these borders to clandes-
tine Western crossings.
The flow of refugees from East Germany into West Berlin during the
week of 7 to 13 January included 321 males in the military age group.
This represents a decided increase over the weekly average of 200 de-
fectors in that category during December and a weekly average of 250
since September. The increase probably indicates fear of impending con-
scription into the East Germany army engendered by propaganda concern-
d
Reported release of political prisoners: There are indications
that an unpublicized amnesty may be in progress in Poland. Such a
program would conform with current Polish propaganda emphasis on na-
tional unity and the necessity for forgiveness of past political errors.
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Following the announcement of the release of Hermann Field on
25 October, there have been numerous unconfirmed reports of the re-
lease of former nationalist Communist leaders. These include Gomulka,
purged in 1949, and his henchman, General Spychalski. There is also
some evidence that the regime has begun an investigation of the con-
victions-in the General Tatar trial of 1951, in which high Polish army
officers, including four generals, were accused of espionage relations
with the US Embassy, Titoism, and preparation of an armed coup to seize
power for the "Gomulka-Spychaiski clique." One of the nrincinals of
that trial allegedly has been released.
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Campaign against West German rearmament: The Soviet campaign against
ratification of the Paris accords remained active during the week. On
13 January the USSR dispatched notes to the Western European Union coun-
tries charging that the agreements contradict the Geneva Protocol of 1925
prohibiting bacteriological and chemical weapons. The note, supplementing
current Soviet propaganda, warned that the accords, by providing West Ger-
many with bacteriological and chemical as well as atomic weapons, would
increase the likelihood of a type of war which would be particularly danger-
ous to "European countries with great density of population."
The Soviet Government's statement of 15 January, offering the prospect
of German unity and West German-Soviet diplomatic relations if the accords
are rejected, represented a softer approach than recent threatening tac-
tics,. For the first time, Moscow suggested the possibility of interna-
tional supervision of elections, but it was careful to remain vague about
other aspects of its position on elections. The statement omitted--but
did not repudiate--the usual Soviet demand for the withdrawal of occu-
pation troops before elections. It was obviously designed to influence
the Bundestag debate on ratification scheduled for late February.
In an attempt to underscore the warning that, after ratification,
relations with East Germany would be strengthened, the USSR announced
on 1.7 January that its ambassador in Berlin had returned to Moscow for
consultations after discussions with East German leaders on this subject.
Soviet ambassadors in Paris and Washington have also been recalled for
consultations.
Atom offer: The USSR `is attempting to regain the propaganda initia-
tive: in the atoms for peace" campaign. On 14 January Moscow announced
that a report on an atomic power station (allegedly working since the
summer of 1954) will be submitted to a conference of scientists which is
to meet in August under UN auspices. A further announcement on 17 Jan-
uary stated that both fissionable material and technical advice are
being offered to the five Orbit states--China, East Germany, Czechoslovakia,
Rumania, and Poland--which have furnished raw materials for the Soviet pro-
gram, thus allowing them to join in "peaceful" development of atomic en-
ergy. This offer matches the US offer of fissionable materials to na-
tions participating in the US "atom pool" plan. Moscow propaganda can
now contrast these Soviet offers with alleged US stockpiling of nuclear
weapons.
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Moscow has always insisted that Communist China be included in
.any international "atom pool" plan, and the Soviet offer suggests
that some such Moscow-sponsored international combine is now in the
making. The USSR has already said it is considering expansion of its
offer to include additional countries. Such an offer will probably
be made not only to other Orbit states but also to non-Orbit nations.
Possible strains in Soviet "collective leadership": The prefer-
ential publicity accorded Party First Secretary Khrushchev during past
months--a product of his increasingly active role in the enunciation
of important policy decisions--appears to conflict with the post-
Stalin principle of "collective leadership" in the'Soviet Union.
Khrushchev, rather than Premier Malenkov, has made the official pro-
nouncements on Soviet agricultural expansion, the lagging construction
program and anti-religious activities. He was the signer of a recent
Central Committee decree changing the date of the annual Lenin cele-
bration and has been the beneficiary of other publicity which tends to
identify him closely with hallowed leaders of the past.
Malenkov, in contrast, has made no major policy pronouncement since
the last Supreme Soviet session in April 1954, at which time Khrushchev
received equal, or slightly preferential, treatment. Foreign observers
in Moscow who have seen Soviet leaders together are unanimous, however,
"
in feeling that Malenkov is "first among equals.
Clarification of lime on hea industrial development: The lead
editorial in the latest issue of the authoritiative Central Committee
Journal, Party Life, as summarized by the US Embassy in Moscow, ap-
pears to confirm earlier speculation that divergent points of view on
economic priorities noted in Pravda and Izvestia in late December re-
flected high-level discussion, and possibly controversy, regarding such
priorities. The Embassy suggests that the recent press emphasis regard-
ing the high priority to be accorded heavy industry has disappointed the
hopes of those elements of Soviet society (lower-level officials) who
expected to benefit by increased supplies of consumer goods. Any down-
ward revision of new course plans for 1955 would probably be limited to
manufactured consumer goods, since the Soviet press has continued to
emphasize the importance of both agriculture and housing.
According to the Embassy report, the editorial criticizes those
who do not support or cooperate with a number of policies of the Soviet
Government, and it singles out for attack the idea that "development in
all. possible ways of heavy industry is now in contradiction with the
economic laws of socialism." It identifies several prominent theoretical
writers as holding the erroneous views. Publication of this editorial
may indicate that any implicit contradiction between the new course poli-
cies and the requirements of continued rapid development of heavy in-
dustry has now been resolved.
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Brazil
Communist activities: In a new effort to incite hostility against
the United States, the Brazilian Communists have launched a propaganda
campaign decrying the US Antarctic Expedition and its alleged plan to
carry out thermonuclear tests. US officials view the campaign as a pre-
lude to future Communist efforts to blame the expedition for atmospheric
vagaries or other natural phenomena. Although Moscow has not volunteered
comment, Izvestia was quick to relay a protest by a leading Chilean Com-
munist writer who claimed that all Latin Americans are seriously concerned
over the alleged US peril to Brazil and the rest of South America. The
Chilean Communist press claimed that these tests would duplicate in Chile
the "sad experience of the Japanese fishermen affected by the hydrogen
bomb."
The Brazilian Communists probably will continue this theme at the
Communist-sponsored South American youth festival scheduled to be held
in Sao Paulo from 6 to 13 February. This festival originally was to be
held last October in Santiago. Following the negative reaction of the
Chilean Government, however, the site of the congress was changed to
Brazil.
The Brazilian Communists are making a ma.or, though concealed, ef-
fort to encourage attendance at the meeting,
international Communist united front line.
ing that the Party had shelved its former militancy in favor of the
.ent estimated membership of 120,000 represents a 100 per cent increase
.in the past two years. Its organizational skill was demonstrated by
the secrecy surrounding the holding of it:; fourth Party Congress last
November. This congress, the first since l9 , adopted a program show-
the largest and wealthiest Communist Party in Latin America. Its pres-
Although their Party has been outlawed since 1947, it is
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