DAILY DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000500130001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 22
• Document Creation Date: December 20, 2016
• Document Release Date: January 10, 2006
• Sequence Number: 1
• Publication Date: October 29, 1951
• Content Type: REPORT

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29 October 1951
CIA No. 49411
Copy No. 143
DAILY DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This summary of significant reports has been prepared primarily
for the internal use of the Office of Current Intelligence. It does
not represent a complete coverage of all current reports in CIA
or in the Office of Current Intelligence. Comments represent the.
immediate views of the Office of Current Intelligence.
State Department review completed
ARMY review(s) completed.
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SECTION 1 (SOVIET)
2. New college for training irrigation specialists in Turkmen SSR. The
head of the educational branch of the Chardzhov Technical College recently
predicted that there will be an increased demand for specialists after the
main Turkmen Canal is built and the area of irrigated lands is trebled.
To meet this need, a new technical faculty has been opened at Chardzhov,
a further two year section added to the Ashkhabad Irrigation College, and
new technical branches are being organized in the Tashauz Agricultural
25X1 College.
Comment.- Soviet propagandists claim that the main Turkmen Canal, to
be opened in 1957, will involve the irrigation and watering of over eight
million hectares of land.
INTERNATIONAL COMMUNISM. World Peace Council meeting in Vienna will
include mass demonstration. The World Peace Council meeting opening in
Vienna on 1 November will include a "peace march" on 3 November. Plans
filed with the Vienna police specify 22 assembly points throughout the
city. Reviewing stand speakers will include Professor Joliot-Curie,
Pietro Nenni, Ilya Ehrenburg and the Dean of Canterbury.
High Commissioner Donnelly foresees the possibility of a successful
sidering the question of devising popular distractions*
mass demonstration, especially since the Austrian Communist party will
hold its convention during the Council meeting. He is'therefore recon
Co entg The Western powers and the Austrian Government had origi-
nally planned virtually to ignore the Council meeting, on the assumption
that it would be a relatively small session devoted mostly to planning
Communist propaganda strategy, particularly in connection with the coming
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UN General Assembly meeting. It is likely that the Communists deliberately
delayed announcement of their plans in order to handicap Western counter-
plans.
In the past, Communist mass demonstrations in Vienna have not aroused
much popular enthusiasm.
ALBANIA. Government announces capture of American and British spies-.
The Belgrade press on 25 October reported that the Albanian Government
had announced the shooting of "thirteen American spies from Munich" as
they attempted to parachute into Albania. The Albanian press on the same
date said that the state security forces, helped by the people, recently"
eliminated "nine British spies" who parachut Albania-with weapons.,
equipment and various documents.
Comment% The Albanian Government apparently is trying to keep alive
Western powers in the recent spy trial.
t th
e
leveled a
the accusations
25X1 A previous report stated that villagers in the the capture of agents. bor*-d to der area were being forcibly
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to The polish
7 POLANDo Polish Minister ex resses absolute su ort fox? eta a the British.
ersonallY has expressed to-the Secrry-general of the
Minister in Cairo p Egypt's position against
He er into talks
Arab League his absolute support for was prepared to ent
further pointed gut that his country
asked scope
with the Egyptian Government should uld the latter desirento bWhroaden the
of the already existing Polish-Egyptian trade agreem-
provide Egypt -with arms, the Miner
whether Poland would be willing thatphe knew nothing about that subject,
25X1 gave an evasive answer saying
to The existing trade agreement betwweeen.Polans and Eprvious
Cow
which already had expanded trade between the cottons has horites, wool
oPoland btained received cultural a d 6onsumer goods,
years$ expires in December.
scrap, and rugs, while Egypt Poland, as well
chemicals, metal products, timber, and mineral products* d goucts. ods because as
as other Satellites, have greater need for opany moves contrary to
Western embargoes, and wish to lend supp Rumania p are now sending
Western interests. The Soviet Union, , and Hung
delegations to Egypt to open negotiations for 1952 trade.
tfox?1.951abut'
The USSR and Hungary had trade agreement8 with Egyp
Egypt signed barter agreements with the USSR,
Rumania did not. Last July tian;rice and cotton were exchanged for
Rumania, and Hungary in which Egyp
wheat.
The State Com--
Year Plan-.
of the National
$. ShorI lco Min s re grted in Poland's Six
the third Planning, quarter of 1951, revealed that production in
mission conomic, for Plan for Economic
E
certain key industries, though increased, fell below planned goals. These
in ore industries included raw freights cars, trucks, od..,
achine tools, ball bearings., and cement. The most signifi adssion
machine t
cottons
c
was that t the e Mi Ministtry oy o of Mining ol, did not carry out in full the roduction p
was t , r
for pit coal and oil.
Comnento While this report is neofa1951slit when compared to is noteworthy the
reports for the first and second quarters
that throughout 1951, the production of oil, machine ttoools, locomotives,
and rolling stock has consistently failed to meet plan goals., his is
the first quarter, however, in which planned coal production has not been
attained. The Polish Government has been making extensive efforts to
increase coal mining through labor recruitment and further special bonuses.
East Germa shi ment relieves Polish otato sho rtO0AOO0 t? Polish
9?
press has annou~,ced the arrival from Eaet Germany
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potatee s.*. The shipment was hailed as a symbol of the growing friendship
and ever closer cooperation between the two nations.
tober report stated that the Polish Government
O
l
c
y
Comment An ear
had decreed the enforced delivery of potatoes by the peasants. The US
Embassy commented at that time that the decree represented a government'
effort to ensure a potato supply during the winter despite a small crop.
Numerous reports from Poland during the summer noted a general shortage
of foodstuffs.
10. YUGOSLAVIA. US Embassy analyz6s postponement of economic refoxmsa From
t t of 91 October postponing the intro-
Finance Minister Popovic s stn emen the institution of
duction of the new economic tem and announcing
several deflationary deviceso $ Embassy Belgrade draws the following
conclusions-
(1) This retreat is dictated by a fear of inflation which would
follow the introduction of a free market,
(2) The immediate objectives of this tactical shift are greater
voluntary food deliveries by the peasants, lower urban purchasing power,
and stabilization of prices and money circulation..
(3) It is not yet possible to judge whether the deflationary
measures are intended to prepare the ground for devaluation or are a
substitute for devaluation,
(4) The Popov~p plan gill favor the peasants and hit urban workers
hard,
(5) The choice of Popovic as the promulgator of the policy of
retrenchment, instead of Chairman of the Economic Council Kidric, is a
further indication of their changing roles in the party.
Comment. It is significant that during last spring's US-British-
French discussions concerning economic aid to Yugoslavia, the Yugoslavs
insisted that the peasants, not the workers, should bear the brunt of
policies necessitated by the investment program and increased defense
expenditure. But now, economic leaders openly proclaim-tie necessity
for lower worker living standards, at least temporarily. This shift
highlights Yugoslav dependence upon rural productivity and indicates a
more realistic approach to the solution of critical problems posed by
suppressed inflation.
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ooraamPn~ evealed: The act-
o~ Zr~ni a~?S ~
ing Tnorr the US Governor of the he Iranian Bank Meiji providesfornunre--~
that the projected Soviet Iranian
stricted trade between the two countries for one year. At the end of the one
year period the country having the unfavorable trade balance would make up the
deficit by exporting additional goods. The Iranian spokesman added that his
or able trade balance
v
f
government did not want to discharge any possible un a
b ivin rials or dollars "which the Soviets would use for operations in Iran."
I Como proposal still has to be negotiated owith pportunity tovobt
This Iranian
delegation. It would, however., seem to give the Russians an opp Y
favorable
tain Iranian oil. Iran reportedly held a
agreement. This might creases its imports from the USSR in order to compensate for the goods it for-
merly got from Britain.
4. INDIA PAKISTAN. Turin-P k~ iii relations reAorterly hate improved: According
statementto
to the US Embassy in New Delhigssas~~nationa sincerity of India's reaction
the Pakistani Prime Minister's a Ali' on Ind.-Pakistani relations made AYE mberaof thesBritishsHighaCommissionertsn-
sion between the two countries,
office has also expressed theview that Indo=P istani relations are now better
than at any time in the last four years ,
mm Previous experience with Indo-Pakistani crises suggests that
Indian reaction to Liaquat Ali's assassination, however sincere, is likely to
be brief. Pakistan's almost immediate return to a state of apparent normalcy and has demonstrated the ability of the controlminimithe dtthe possi?
identification of the assassin as an Afghan a
Accordingly, the Indians
bility of armed anti-Indian outbreaks in Kashmir.
as regCounciard
may feel little need to modify ntheir
anal they may be as uncompromising
to discuss thelashmir case.
nt~; ~~ fl~ statements e
5. BUFi?l.4. 0 Ul press co nference in New Delhi, after
Prime Minister Thakin Nu of Burma told a phis two day meeting with Nehru, that conditions were
daily. He stated that there were only 3,000 to 4,0
about the country and that their uezt~lhadnnots receivedeaidvfromsChi ap which.,
Burmese also said that the ins g
he claimed, had maintained a "very correct attitude" towards Burma.
A high official of the Indian Foreign Ministry, in conversation with the
US Charge, dismissed as exaggerations British reports that the situation in
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r of B es
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Burma was deteriorating and said that Indian intelligence supported Thakin
Nu's optimistic outlook
Convent. These statements represent a deliberate distortion of the
facts. The Burmese War Office now estimates that there are about 18,500 in-
surgents in Burma, and Commander in Chief Ne.Win recently admitted that thel
initiative had passed to them. The remarks of the Prime Minister may be only
an effort to maintain the fiction of Burma's "neutral" foreign policy or to
hide the Burmese Government's weakness. The extreme air of casualness, how-
ever, which has been assumed by both the Burmese'and Indians gives rise to
the suspicion that the conference between the two Premiers was of greater
significance than described and that important substantive decisions may have
been taken regarding Burma's foreign relations, particularly insofar as they
relate to Communist China.
ed? The US Legation
6. BURMINDCHINA. Vi Dinh ex-oul has featured the expulsion of the Viet
25X1
25X1
in Saigon reports that the local press
re-
Minh representatives in Burma.. Six members of the twelve?m mission are re- 2 5X1
orted to have left Lashio, in north Burma, on 20 October.
Comment The expulsion of the Viet Minh representatives from Burma was
ordered because of their inordinately close relations with "anti-Government
elements."
7. BURM ZJ_AP4N. 9Tmese-Jap e d relat one s us edo In a recent discussion
with the US Ambassador, the Burmese Foreign Minister stated that a "simple
unilateral declaration" ending the state of war with Japan might be forth-
coming in the near future. He indicated, however, that action would at least
await the return of the Prime Minister from India. The Foreign Minister in-
timated that Burma would consider a trade treaty with Japan after making peace.
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10. INDONEIA. CQ nission ,,pointed to study revision oRTC agreementss The
Indonesian Cabinet has appointed a commission to study replacement of the
Round Table Conference agreements with an ordinary bilateral treaty. The
Commission plans to present a definite proposal to the Netherlands during
the latter half of November. Government opinion., however, apparently is
divided as to whether Indonesia should seek immediate action or let matters
drift until after the Netherlands election in June 1952.
qs An Indonesian mission visited the Netherlands in August to
G2MMg-
initiate discussions on the abrogation of the Netherlands-Indonesian Union
and the replacement of the other 1949 Round Table Conference agreements with
25X1 an ordinary treaty. The two governments are now drawing up working papers
which will be used as a basis for further negotiations.
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12. PHILIPPINES. Romulo disappointed at indication that US will not support
Philippine election to Security Councils Secretary of Foreign Affairs
Romulo was deeply disappointed when it was indicated to him that the US
might support Greece rather than the Philippines for election to the
Security Council. He argued that American failure to support the Philip-
pine candidacy was poor a ment for a nation so frequently accused of being
25X1 an American puppet.
Comm s Romulo has been campaigning in support of the administration's
acceptance of the Japanese peace treaty, and he would be particularly
desirous at this time of any increments to the Philippines' international
prestige.
13. CHINA.. Peiping asks for austerit rogramob In a report on economic
and financial affairs, Chinese Communist Vice Premier Chen Mun.deolared
that the nation's financial resources were adequate for the demands for
national defense and economic reconstruction. The Communists, he pointed
out, have kept prices in line and maintained a stable currency. Hie never-
theless called for an austerity program on a nation-wide scale. Economy
and increased production, he said, "ere essential elements of the Communist
25X1 economic policy. F7 I
25X1
Co ens A campaign for austerity would formalize what has in fact
been consistent practice in China since the Communist victory. Workers have
repeatedly been enjoined to give emphasis to increased output rather than
to kiigh@r wages. Peasants have been propagandized on the duty of paying
htg1 taxes. "Voluntary" contributions to support the Korean campaign have
been exacted from all classes. The Communists have enforced austerity with
marked vigor. As a result, they have managed fairly well to keep the
economy stable and have avoided the sort of inflationary spiral which cost
the Nationalists public prestige after World War II.
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15. palai Lama endorses Communist program for the "liberation"
of Tibet.. Peiping radio has broadcast an exchange of telegrams between
Mao Tse-tung in Peiping and the Dalai Lama in Lhasa. Mao thanked the Dalai
Lama for his "efforts in implementing the agreement for the peaceful
liberation of Tibet." The Dalai Lama had advised Mao on 24 October that the
local government, monks and populace of Tibet are giving the May 1951
25X1 agreement "unanimous support."
C gn o A delegation from Lhasa concluded an agreement with the
Peiping regime in May 1951 providing for Tibetan cooperation in the ex-
tension of Chinese Communist authority over V.bet. It was widely believed
that the Dalai Lama, in refuge on the Indian border, would repudiate this
agreement, which deprived him of all significant power in Tibet. However,
by September the Dalai Lama had rr-+,i-ned. to Lhasa, under no(-. unntion by
Chinese Communist advance forces,;and has since been expected to endorse
the agreement. The Dalai Lama's adherence will facilitate the consolidation
of Communist control of Tibet.
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SECTION 3 (WESTERN)
1, GERMANY. West German legislature has developed independence s cholo
representatives in Bonn o serve th-aV e Wes erman eggs a ure is"further down the road of independence than its legal status warrants,'."'
The lower house seems to feel that Germany's anticipated new political
position has already been achieved, and that any further attempts of the
Allies to complete unfinished programs are a violation of the sovereignty
Germany has not yet gained. Our representatives expect this attitude to
become more evident before the contractual relationship goes into effect,
25X6 despite Chancellor Adenauer's sincere desire to have the Allies complete
their programs.
25X1
n
fields in which the Allies are attempting to interfere wi r
such as the coal-allocating functions of the Ruhr Authority.
Ernst Lemmer may be appointed new government press chief: Chancellor
Adenauerts choice for new West German Feera press c Ernst Lemmer,
a leader of the Christian Democratic Party in Berlin and editor of the
Berlin Kurier. The press office is to be expanded and the new press chief
will be given the rank of State Secretary, which entails a seat and voice in
the Cabinet. The appointment of Lemmer, who is in the left wing of the CDU,
may help to consolidate the party. It would also be a gesture toward all-
' A ointment of a new press chief is the result of pressure
Comment: These observations are prompted by the legislature's scathing
criticism of Allied plans to insist on the sale of properties belonging to
the German motion picture combine. German restiveness is manifest in other
4-1, (1- an interests
a
German senuimsn . App
for a ore effective information program on behalf of the governments
Comment: Lemmer was a leader of the CDU in the Soviet Zone until 1948,
when t 7e Soviet authorities forced him out of his position. East German
politicians, such as Foreign Minister Georg Dertinger and Otto Nuschke,
CDU chief, still frequently talk to Lemmer
ortunit seen for non-Communist labor alliance as Communists
O
_.
3, FRANCE.
p an strikes; US Embassy in Paris e ieves apt presen critic wage-
price problems may soon result in a national conference of French economic
groups from which the government will exclude the Communist-controlled
General Labor Confederation. The success of such a conference, which would
include the Socialists, would make a strong non-Communist trade union
alliance possible. Some of the leaders, with t*astonishingtt though perhaps
"undue" optimism, are even talking of unification of the major non-Communist
groups "for the first time." -
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Meanwhile, there are indications that Moscow has given the French
Communists a free hand for organizing an "economic" mass movement devoid
of "political antics." Strikes will probably be called during the UN
2 5X1 Assembly session in Paris.
Comment: The General Labor Confederation dominates French labor
largely because the non-Communist unions have always failed to cooperate
effectively. Virtually every political crisis in recent years has been
precipitated by the Socialists who feared General Labor Confederation gains
at the expense of the non-Communist unions.
The Socialists, in order to prevent a Gaullist accession to power, may
now try to strengthen the wobbly Pleven government by supporting such-a
national economic conference.
French Communists have consistently failed in their strike movements
largely because they were ordered to tie in political objectives.
French show continued interest in trade with USSR: A Foreign Office
spokesman has told a Embassy official that France p ans "active" pursuit
of the current trade negotiations with the USSR in view of increased French
grain import requirements and declining supplies of dollars. The spokesman
added that COGOM commitments would "of course be scrupulously observed."
25X1
Comment: These trade negotiations were begun after the two countries
sign. a general commercial treaty early in September 1951. French officials
have been placing increasing emphasis on their country's need for more
imports from the Soviet Orbit, and at the August UN-sponsored meeting on
East-West trade the French eagerly explored all possibilities of trade with
the USSR in non-critical items. The USSR consistently demanded strategic
commodities in return for Russian grain.
The French have previously admitted that they reserved the right to
export limited quantities of critical items to the Orbit when necessary to
obtain vital imports such as coal. It is doubtful,, hovyever, that French
grain needs are urgent inasmuch as the 1951 bread-grain harvest nearly
fulfilled French needs, and this year's abundant rainfall has greatly
reduced feed-grain requirements.
NETHERLANDS. Benelux countries may oppose European Defense Forces plan:
A Social! st member o the Dutch Parliament states confidentially that the
Benelux meeting at Brussels on 25 October was convened "to organize a
united front against the European Defense Forces."' The-Dutch Foreign
Office strongly opposes the European Defense Forces plan, and the Cabinet
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is divided on the issue, with the Socialists and Catholics supporting the
25X1 P. Comment: The Meeting of Benelux ministers ostensibly was intended
to examine The various questions which might be raised in connection with
a common European defense organization. None of the Benelux countries has
indicated any enthusiasm for the plan, and the Dutch Foreign Minister is
known to be personally opposed. However, after much Cabinet and high-level
discussion, the Dutch recently sent an official delegate to the European
Defense Forces conference in Paris.
6., SPAIN. Spain seeks rapprochement with Moroccan Nationalists: General
ranc.o allegedly has approved a scheme for including Spanish Moroccan
nationalists in the administration of the Spanish protectorate of Morocco.
The Spanish High Commissioner plans to talk with the leader of the Spanish
,Moroccan Nationalist party, a man who has long been considered a fugitive
from Spanish justice. .
would use Spanish Morocco as a base for anti-French activity,
I
The US Legation in Tangier comments that the High Commissioner
apparently is moving rapidly'toward a rapprochement with the Nationalists
despite the opposition of his advisors, who caution that the Nationalists
Comment: Spain has long resented the preponderant French influence in
Morocco and desires to strengthen Spanish prestige with the Arab states.
By apparently relaxing their severe repression of nationalism, by
promising participation in government now, and by hinting that Spain favors.
Moroccan independence, Spanish officials hope to discredit France with the
Arab League and improve Spain's relations. Spain has no intention, however,
of relinquishing its hold on Morocco,
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8. SWEDEN. Foreign Minister fears UN may become a broadened NATO: On the
anniversary of the UN, Swedish Foreign Minister Unden stated in a public
address that the UN must not become an anti-Communist alliance. Although
he admitted the non-..aggressive and basically legitimate character of the
Atlantic Pact, the UN would not, in his opinion, be able to preserve its
character as a universal organization for international cooperation if it
becomes an enlarged anti-Communist alliance.
Comment: The Swedish Government, which continues to favor an "alliance
free" foreign policy, harbors certain apprehensions that if the UN becomes
strongly anti-Communist, that is, anti Russian, Sweden may be forced to
disassociate itself from that organization and retreat into an isolated
seclusion. That the Swedes are disturbed by the impact such a move would
have on their reputation as well as on their security, was indicated by
the fact that Unden took great pains to quote the London Times and Sir
Gladwyn Jebb to show that Sweden is not alone in its desire keep the UN
an organization for "harmonizing the actions of the nations in different
fields."
25X1
25X1
10. PANAMA. Black-listed steamer in China trade seeks Portuguese registry:
TF' he Panamanian Foreign Ministerihaa'Informed Ambassador that the
British owners of the freighter Taluei who have applied for cancellation
of Panamanian reg'st have been authorized to register-the ship under the
25X1 Portuguese flag,
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Comment: The Taluei was faced with deregistration proceedings under
try
the 1 August Panamanian directive ordering the cancellation of regismaterials
for all vessels calling at Communist ports in Asia or caring war
to Macao or Hong Kong. The freighter recently delivered a cargo of
strategic manganese to Macao for alleged transshipment to China.
The US Consul in Hong Kong believes that P. J. Lobo, Macaots economic
director and reputed political boss, will welcome all such applications for
transfer to Portuguese registry. A Portuguese Foreign Office spokesman has
stated informally in Lisbon that only Portuguese-otivned ships are eligible
for Portuguese registry; he gave his assurances that he will watch closely
all applications for Portuguese registry.
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29 October 1951
CIA No. 49411-A
Copy No. 49
TO THE DAILY DIGEST
Not for dissemination outside O/CI and O/NE.
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This summary of significant reports has been prepared primarily
for the internal use of the Office of Current Intelligence. It does
not represent a complete coverage of all current reports in CIA
or in the Office of Current Intelligence.
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Approved For;