CURRENT INTELLIGENCE DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A001200190001-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 15
• Document Creation Date: December 12, 2016
• Document Release Date: January 4, 2002
• Sequence Number: 1
• Publication Date: September 4, 1952
• Content Type: REPORT

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SECRET
SECURITY INFORMATION
US OFFICIALS ONLY
4 September 1952
OCI No. 8867
Copy No. r
CURRENT INTELLIGENCE DIGEST
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
This digest of significant reports has been prepared primarily
for the internal use of the Central Intelligence Agency. It does
not represent a complete coverage of all current reports re-
ceived. Comments represent the immediate views of the Office
of Current Intelligence.
State Dept. review completed
SECRET
SECURITY INFORMATION
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THIS MATERIAL CONTAINS INFORMATION AFFECTING THE NATIONAL
DEFENSE OF THE UNITED STATES WITHIN THE MEANING OF THE
ESPIONAGE LAWS, TITLE 18, USC, SECS. 793 AND 794, THE
TRANSMISSION. OR REVELATION OF WHICH IN ANY MANNER TO AN
UNAUTHORIZED PERSON IS PROHIBITED BY LAW,
1. Harvest difficulties in the USSR: The US Embassy in
Moscow reports that as'ye there have been no regional
announcements of the fulfillment of compulsory grain deliveries.
This delay, the most protracted in five years, reflects the
late spring in most areas and difficult harvesting conditions
in others. It is also believed that further harvesting losses
may result from the continued cool and rainy weather in the
central and northern areas, (S Moscow Weeka 35, 30 Aug.52)
2. Bulgarian International Trade Fair opened: Speaking at
the official inaugural en a ov v samp a fair on
31 August, Bulgarian Vice Premier Damianov stated that the
exhibition "illustrates the close economic collaboration be-
tween nations on the basis of equal rights and mutual ad-
vantage, a collaboration under which the international economic
conference took place in Moscow."
Earlier, the Bulgarian Minister of Foreign Affairs
asserted that the meeting would offer "a reply to the pro-
vocative attempts of.the United States monopolists who, with
their policy of discrimination, are attempting ... to prepare
a new world war." (R FBIS Sofia, 2 Sept 52; Summary of World
Broadcasts ##338, 14 Aug 52)
Comment-. The Plovdiv International Fair will continue
throug eptember. Propaganda pamphlets and letters to
various European firms have stressed that the Fair is to be
regarded not only as a Bulgarian undertaking, but as a joint
Eastern European effort. According to Bulgarian press re-
ports, some 130 firms from Sweden, Italy, Austria, France,
West Germany, Holland, Switzerland, and Britain will participate,
in addition to the states of the Satellite Bloc.
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3, Possible increase in size of Bulgarian military forces:
According to in orma,tion emanating from t e rent Legation
in Sofia9 the Bulgarian Ministry of Defense has postponed
until January 1953 the release of half of the military class
of 1929 which was originally scheduled for July. Moreover9
half of the class of 1933 has been called up six months ahead
of schedule. On the basis of this information, the French
believe that four and one half classes are presently under
arms in Bulgaria. (S Athens 7479 2 Sept 52)
Comment: The call-up of the military class of 1933 has
not prev'ly been reported and is not supported by other
evidence. The induction of this class would appreciably
augment the overall capabilities of the Bulgarian Army,
Although the French report would tend to suggest that
the classes of 19299 19309 19319 19329 and half of the class
of 1933 are now under arms, there is evidence to indicate
that at least a part of the class of 1929 has been released.
The personnel strength of the Bulgarian Army is currently
estimated to be 15090000
4. Bulgarian State retail consumer prices reduced: The
Council of
nis erg an eta Qamm~ ee o e ulgarian
Communist Party have issued a decree reducing State retail
prices on a large number of consumer goods. The reductions
are allegedly the result of a considerable increase in output
nd a concomitant reduction in production costs.
Prices of merchandise sold by workers' cooperatives, by
agricultural establishments, and by peasants in town markets
will not be affected by the decree. (R FBIS Sofia, 2 Sept 52)
Comment: Although the monetary reform in May was ac
m
compahl, Y a general reduction in retail prices, an increase
in workers' wages and an abolition of rationing, the purchasing
power of the Bulgarian population was considerably decreased
and the cost of living showed a distinct rise. These earlier
price reductions were largely artificial, since the changes
were based on former free market prices rather than on the
lower, standard prices which had governed the sale of merchandise
under the rationing system. The present decree might indi-
cate that new adjustments were found necessary in order to
place price levels on a more realistic basis and encourage the
movement of goods in domestic trade.
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The increased cost of living in Bulgaria has reportedly
given rise to general discontent, and the new price reductions
may be, at least in part, a government attempt to mollify a
restive population.
5. French official believes Bulgarian purge imminent:
According to Information received by the American massy
from the French Embassy in Athens, the French Minister in
Sofia believes that Premier Chervenkov will play a more and
more secondary role in Bulgarian politics, being replaced by
General Ivan Mihailov, a Vice Premier and "Kremlin devotee."
According to the same source, a general purge was
announced in Sofia on 20 June affecting second rank Communist
Party members who criticized monetary reforms. A meeting
held at Varna on 3 August deplored the lack of discipline of
the Communist Party of Bulgaria and denounced the apathy of
high authorities, "thus indicating the beginning of a new
and larger purge reaching as high as the Politburo."
(S Athens 747, 2 Sept 52)
Comment: An effort to tighten up administrational
efficiency nd discipline on all levels of Bulgarian party
leadership has been under way for several months.
Rumors concerning the imminent replacement of Premier
Chervenkov have been commonplace since his election in
February 1950.
6. Rumors of a return to rationing cause panic buying in
Budapest sores: The u apes ra o escrihes a panic buying
spree n Iffe- Hungarian capital last weekend after rumors
that rationing would be reinstituted. The radio branded the
episode as "the enemy's attempt to disturb the smooth flow
of public supplies" and declared that the government's supply
system was too sound to be upset.
Another broadcast asserted that several "speculators"
who had hoarded fat, sugar, soap and flour had been condemned
to three or five years of imprisonment, had their property
confiscated and their apartments taken over for "worthy
families with children." (R FBIS Budapest, 2 and 3 Sept 52)
Comment: Shortages of corn, vegetables, and livestock
which may result from poor crops this year may cause a re-
institution of rationing. Rumors of a return to rationing
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have been current all summer and the Budapest radio has
carried accounts of the punishment of "kulaks" for hoarding
flour and other commodities.
Rationing in all products was abolished last winter.
Simultaneously sharp increases in the price of most foods
were announced, and since that time prices have risen
further. Rumors of a currency reform last January touched
off a similar buying rush.
7. Hungarian Mining Ministry official reportedly arrested:
The U ega ion n u apes as learn, from a relic le source
that two officials in the Hungarian Ministry of Mines have
been arrested, as well as the chief engineer and four sub-
ordinates at the Varpalota coal mines. Moreover, the
Legation notes that the official Hungarian trade union news-
paper has criticized the Chief of the Ministry's Coal De-
partment for negligence in enforcing collective agreements
with the unions. The measures are in connection with the
current drive to spur coal mines to meet the plan. (R Buda-
pest 204, 2 Sept 52)
Comment-, A recent editorial in the Hungarian Workers
Party o icial organ charged that "conservative opinions" in
the Ministry of Mining and Power constituted "direct re-
sistance" to the use of mining machinery and sabotage to the,
plan. The Minister of Mines has been unaccountably absent
for about two months.
The Budapest radio a month ago accused the Varpalota
Mines of inefficiency because no competition had been arranged
by 43 brigades to honor Constitution Day on 20 August.
8. Rumanian "saboteurs" sentenced-, The Bucharest Territorial
Military Tribunal as sentenced a gang of saboteurs and
wreckers" from the Danube-Black Sea Canal construction project.
Five of the ten defendants were sentenced to death "for
sabotaging the thriving Rumanian national economy," the other
five received terms of from 20 years to life imprisonment.
These former engineers, section chiefs, and locomotive'
engineers, identified as former Iron Guardists and members
of the bourgeoisie and opposition parties, were charged with
infiltrating into leading positions on the canal project and
slowing down construction. To achieve this they delayed
and "mixed up" planning, slandered and sabotaged Soviet
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equipment, and spread provocative news against the Rumanian
People's Republic and the Soviet Union. (R FBIS Bucharest,
2 and 3 Sept 52)
Comment: The arrest and sentencing of these officials
in a s ow trial on the construction site suggests that they
have been used in technical capacities for which they were
trained and are now being made scapegoats for generally un-
satisfactory progress of the canal.
The American Legation in Bucharest has recently reported
poor progress on the canal. One informant who worked two
years on the project mentioned in particular the improper use
and maintenance of construction machinery.
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SECRET
FAR EAST
9. Mao again thanks Stalin for "help" against Japan: A
telegram from Mao se- ung t6 Stalin on the 9eventfi anniver-
sary of V-J Day expresses "deep gratitude" for the USSR's
"tremendous aid" to China during World War II and for having
"helped the Chinese people to achieve the final victory..."
Mao notes that the Sino-Soviet alliance is directed against
aggression by Japan or any state allied with Japan.
Stalin's reply credits the Chinese with having ~layed
an "immense role" in the defeat of Japan and cites Sino-
Soviet friendship as a guarantee against "the danger of
new aggression.- (R FBIS Peiping, 2 Sept; Moscow,3 Sept 52)
Comment: Mao last year thanked Stalin for "great help"
in the war against Japan, and Stalin conceded that China bad
played an "important part." These exchanges are interesting
in that they show a Chinese refusal to relinquish the claim
of having led in the war against Japan, and a Soviet willing-
ness to refrain from the usual assertion that the USSR won
the war almost single-handed.
Despite these indications of a sensitive area in Sino-
Soviet relations, these messages, like last year's, reaf-
firm the joint Sino-Soviet commitment, formalized in the
1950 treaty, against "aggression" by Japan and its allies.
10. Madame Sun calls for peaceful settlement of Far Eastern
conflie s: current eop e sZ`fiina article1W l eSun
Yat-sen, on the Pacific "peace" conference opening in Peiping
late this month, supports other evidence that the emphasis
in world communism's Far Eastern program is shifting from
military to political action.
Madame Sun argues that peace is an "urgent practical
problem" in the Far East, where "several wars" are in pro-
gress. She denounces alleged American aggression and asks:
"Who benefits by the fighting in Korea, Vietnam and Malaya,
by the unilateral treaties which keep other countries as
colonies, by rearmament, by restriction of trade and
cultural intercourse?"
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Madame Sun's article follows the main lines of Asian
Communist propaganda of the past three months. A conference
of Soviet theoreticians last November altered the official
line of the previous two years--that of primary reliance on
military operations by indigenous "liberation" movements.
The theorists emphasized the prospects for successful
political action to "unite" Asian peoples in opposition to
the West. Several Far Eastern Communist movements, probably
for a variety of reasons, have shifted their tactics in the
past year, and Communist propaganda since early June has
called-for peaceful settlement of all current Far Eastern
conflicts. (Factual data from: R FBIS Peiping, 28 Aug 52)
SOUTHEAST ASIA
Philippine Government hopes to bargain for participation
in AN777? ' ip ine Foreign lQlinis~er ET3'zIcTe iinformed ie
rent Charge that his government would eventually ask to
participate in ANZUS, and that this participation would enable
President Quirino to obtain Senate ratification of the Japa-
nese peace treaty.
The American Ambassador in Manila believes that Philippine
inclusion in ANZUS is still undesirable, that it would not
bring about ratification of the peace treaty, and that the
United States should not "bargain" to obtain ratification.
(S Manila 651, 2 Sept 52)
Comment: Formalization of the US-Philippine Mutual
Defense acE was arranged for 27 August to counteract criti-
cism in Manila of the ANZUS meeting at Honolulu. The United
States maintains, however, that the Philippines is still
obligated to ratify the Japanese treaty because of an agree-
ment a year ago that the exchange of ratifications of the
Mutual Defense Pact would be dependent on this act.
Inclusion of the Philippines in ANZUS will probably be
opposed by Australia and New Zealand, which are reluctant
to increase their defense responsibilities.
Indonesian Foreign Minister expresses opposition to aid
from govieVntonForeign M isfe`r Mukar in an Iif VEew
on~~Augus~ expressed his opposition to the acceptance of
assistance from the Soviet Union lest Indonesia become
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"another Czechoslovakia." He stated that although Indonesia
would accept aid from "any country willing to respect our
sovereignty and independent neutrality," he did not think
it wise to accept technical assistance from the USSR "now"
because "there would probably be stronger strings attached
to it than to American aid." Mukarto added that the estab-
lishment of an Indonesian Embassy in Moscow was necessary to
implement Indonesia's independent foreign policy. (R Djakarta
430) 2 Sept 52)
Comment: The Soviet Union has made no offers of assist-
ance o n onesia, but a recent Burmese request for Russian
aid has aroused press speculation as to Indonesian policy
should such aid appear to be available.
Indonesia has yet to make a clear-cut statement on the
desirability of American aid.
13. Indonesian Moslem Party congress attempts to mend party
split .'I`e Mas u i (Moslem party annual congress, which
end ea 31 August, elected Natsir and Sukiman as chairman and
vice chairman respectively of the party's executive council.
As leaders of the liberal and conservative factions of the
party, their election is regarded as an effort to balance
the two groups.
The foreign affairs program endorsed by the party urges
a foreign policy based on the defense of world peace, friend-
ship with all countries, "particularly God-fearing and demo-
cratic ones," active participation in the UN, acceptance of
foreign aid "only if this entails no military or political
commitments restricting sovereignty," and the inclusion of
West Irian in Indonesia. (U Djakarta 431, 2 Sept 52)
Comment: The Masjumi is the largest and most conserva-
tive poriTcal organization in Indonesia. Its liberal wing
is represented in the present cabinet.
Political strife between the two principal factions has
led to concern lest the party split, thereby seriously dimin-
ishing its influence as a moderating force in Indonesian
politics. Responsible party leaders, however, aware of the
need for a responsible political organization in Indonesia,
apparently are trying to hold the Masjumi together as a co-
hesive group. The wording of the foreign affairs-program
indicates the willingness of both groups to compromise.
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The selection of Natsir as chairman indicates that his group
continues to be in the ascendency.
14. Turkish National Confederation of Trade Unions announces
some objectives: The General Secretariat of the newly-
organized ur sh Confederation of Trade Unions has announced
that among its objectives are a sliding wage scale based on
cost of living indices, unemployment insurance, and the
removal of wage differentials because of age or sex.
(R Ankara AFC 138, 1 Aug 52)
Comment: The present administration has enacted laws
to pay w`orrers half wages for non-worked holidays, and has
expanded the 1936 labor code to cover an additional 75,000
workers. Some action is also being taken to put into effect
the minimum wage provisions of the 1936 labor code. Strikes
are illegal under present Turkish law, but there is a bill
pending which would permit both strikes and lockouts under
certain conditions.
15. New Turkish Minister appointed to Bulgaria: The present
TurkisW Minister to Fin an , emaT-Xavur ; fas-seen appointed
Minister to Bulgaria. The Turkish Foreign Office emphasized
to the American Embassy that the appointment has no special
significance, and reflects no improvement or change in
Turkish-Bulgarian relations, and no change is anticipated in
the frontier situation. (S Ankara 281, 31 Aug 52)
Comment: Turkey has a Minister currently assigned to
Bulgaria; but he has not been in residence there for two
years. Bulgaria has retained a Minister in Ankara, however,
and Turkey apparently believes that diplomatic representation
in Sofia is now advisable.
16, French officials meet next week to revise Moroccan
impor con rots : _ French officials in Morocco are s&He_'ffuled
to con eei withthe French Foreign Office on 9 or 10 September
to revise Moroccan import controls which were recently de-
clared invalid by the International Court of Justice.
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The French Foreign Office considers that new regulations
could be ready within two weeks, but that they would probably
disappoint American business interests in Morocco. On the
other hand, French protectorate authorities are inclined to
oppose both regulations which would apply equally to French and
foreign business and to complete freedom of importation.
They also are anxious to protect Moroccan industries, such
as textiles and sardine-packing. (C Paris 1350; Rabat 18,
2 Sept 52)
Comment: In general, the French and the Moroccans have
been pTFase with the International Court's ruling of 27
August. While the Court did uphold'American treaty rights-,
as well as the US position with regard to discriminatory
import regulations imposed in December 1948, it ruled that
prior US Government agreement is not required before
Moroccan law and taxes are applied to American nationals
residing in the protectorate.
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WESTERN EUROPE
17. Pro-Italian group in Trieste reportedly believes partition
of territory acceptable to Italians: The leader o the pro-
Italian Committee o National Liberation (CLN) in Istria appears
25X1X convinced that the Italian people have accepted the idea of
dividing the Free Territory of Trieste,
Although the organization has hitherto held
25X1X thati tine entire territory should go to Italy, the CLN leader has
reportedly stated that it will accept partition under protest.
He believes, however, that the Italian Government should stall
on any settlement of the Trieste issue until after the forth-
coming national elections. (S Trieste Joint Weeka 35, 29 Aug 52)
Comment: No other reports have been received to indicate
that a`paition of the Free Territory would be acceptable to'
Italian public opinion. However, there have been recent indi-
cations that the Italian Government may be willing to consider
partition based on an ethnic line.
18. American officials urge encouragement of pro-West senti-
ment in East Germany: American o c a s In Berlin believe that
the will o pro-Western elements in East Germany to continue to
resist Communist pressure depends upon a prompt and decisive reply
to the Soviet note of 24 August. They cite indications from the
Soviet Zone that the anti-Communist majority cannot hold out much
longer without some positive response on the part of the West.
American representatives in Berlin urge that, to maintain
East German faith in the West, the Western powers either termi-
nate the exchange of notes with the Soviet Union or agree to an
early four-power conference in Berlin. While the first
alternative would have the advantage of demonstrating Western
"courage," the second would make very difficult the "building of
Socialism," the erection of a military machine, and the further
isolation of the population in East Germany.
These officials believe that the greatest weakness of the
Western position in East Germany is the popular impression that
the Russians are more willing to gamble on the unity theme than
the West. (S Berlin 375, 2 Sept 52)
Adenauer optimistic on ratification of Bonn and Paris
treaties: After his first consultation with the West German
Cabinet following a month's absence from Bonn, Chancellor Adenauer
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told General Ridgway that he was more confident than ever that
the Bonn and Paris treaties would be ratified by mid-October at
the latest. The Chancellor also stated that as soon as the
treaties had gone into effect, West Germany would make its full
contribution to European defense. (S Bonn 935, 2 Sept 52)
Comment: The Chancellor's optimism suggests that he does
not be i eve that parliament will press him for a full settlement
of the Saar problem prior to the treaties' ratification.
Despite Adenauer's positiveness on the West German share
in European defense, negotiations over the Federal Republic's
1953-54 contribution to the European Army will probably be diffi-
cult and prolonged.
20. Austrian trade negotiations with Soviet Union held politi-
cally necessary: American Embassy o c a s in enna are
inclined to agree with Foreign Minister Gruber that it has
become "politically necessary" for the Austrian Government to
raise the question of a trade agreement with the Soviet Union.
Soviet trade propaganda has allegedly been most effective among
conservative and business circles, but Socialist leaders re-
putedly also accept the necessity of trade negotiations as the
only way of disproving the claims of Soviet East-West trade propa-
ganda.
Embassy officials believe that Austrian receptivity to such
propaganda, which reflects mounting concern over unemployment
and export problems, will largely evaporate when transactions
with the USSR fall short of expectations. (S Vienna 623,
2 Sept 52)
Comment: Although Soviet propaganda and recent economic
concessions have cleverly exploited Austrian economic diffi-
culties, there is little evidence of strong political demands
for an Austro-Soviet trade agreement as such. Since the Soviet
Union is in a position to conduct all of its Austrian trade
through "illegal" channels provided by the Administration of
Soviet Enterprises in Austria (USIA), any Soviet pressure for
a trade agreement would appear to be politically motivated.
Austrian leaders may be primarily hoping for Soviet "conces-
sions" which would "legalize" USIA trade even though they express
doubts that such concessions would result.
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LATIN AMERICA
21,
25X1A
opposition, The police
Bolivian police use shooting incident to arrest members of 25X1C
oppos ion: The "attempted assassination" o the Bolivian Presi-
dent's secretary on 28 August was actually planned by the govern-
ment to create an excuse for taking action against members of the
used the incident as a pretext to arrest about 70 persons, most
of them members of the Falange Socialista Boliviana (FSB). The 25X1A
government had reportedly decided that the time was propitious to
stop the FSB's numerous meetings. F_ I
Comment: The government may well have planned the incident
to curtail plotting by the FSB, which is now the principal op-
position party. The FSB recently circulated widely a defamatory
pamphlet against the governing Nationalist Revolutionary Movement.
25X1 C
22. Communist revolutionary plot rumored in Brazil: An
in Sao Paulo, Who is an active Communist, reportedly warned a
former classmate in August that "within 60 days serious events
will occur throughout Brazil," that "all points of resistance will
be eliminated," and that "much blood will flow." 25X1A
25X1A F_ I
,Comment: The Brazilian police, while not discounting the
possibility of an increase in Communist capabilities, apparently
have a well-founded confidence in their ability to control any
subversive effort at this time. Although the militarization of
the Brazilian Communist Party has probably increased during the
past year, there are no indications of Communist preparations
for an early revolutionary attempt. The Communists in Sao Paulo
seem to be more optimistic than party members elsewhere in Brazil
as to the feasibility of overthrowing the Vargas government by
force.
23e Ibanez may challenge Chilean election result with "popular
militia": campaign lea er or presidential candidate anez
del ampo reportedly has been secretly training "popular militia"
groups throughout Chile "to defend the legitimate triumph of
25X1A Ibanez" in the 4 September election. Arms and ammunition have
Comment: This is the first detailed report of a popular
militia, and is in line with activities at the enthusiastic
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24,
Ibanez rally of 31 August, where speakers called on his followers
to keep themselves in readiness "for any eventuality." The
Chilean Government, according to the United States Embassy, is
aware that Ibanistas are training a militia.
Ibanistas, possibly with Communist support, may foment
disorders or attempt a coup if it appears that the election is
rigged against their candidate, or if Ibanez gets a plurality of
the votes and is not named president by a joint session of the
Chilean Congress.
25X1 C
Nicaraguan Communist Part reportedly ceasing activity tempo-
rarily: leaders o e icaraguan
Communist Party now admit that the government's close check on
them is preventing effective operations under the present party 25X1A
organization. They have reportedly decided that the party will
cease activity for the next six months in order to reorganize on
a truly clandestine basis,
Comment: The Nicaraguan Communist Party was outlawed in
1945, but its 1,500 militants have continued to operate semi-
clandestinely. The party's influence in Nicaraguan affairs has
been diminishing because of numerous setbacks, particularly in
the field of organized labor.
The party's planned reorganization is probably being carried
out to ensure its continued operation in the face of the govern-
ment's increasing anti-Communist stand and possible further
restrictions.
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