FIRST ANNUAL PROGRESS REPORT OF THE IWG AUGUST 1952-JULY 1953

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP62-00328A000100500010-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 12
• Document Creation Date: December 9, 2016
• Document Release Date: March 12, 2001
• Sequence Number: 10
• Publication Date: September 18, 1953
• Content Type: REPORT

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NG/R-13
Control ro. V5273
18 September1553
fiFT ANNUAL PacoRrss REPORT OF VI TWO
' August 1952 - July 1953 .
1. Authority for t-,e IntelligenceVorkingq Group
The Director of Central Intelligence approved the proposal of the
Director for Mutual. Security and the Secretary of State for the ertab-
lizilnert of en Intlligece Working Group (TG) for direct intelligence
suoport of the Economic Defense kdvisory Committee (EDAC). The proposal
wan' inCorsed by thu cc.retary of Defense. NU Terms of Reference were
;',orevt:c1 by the Inte1li3ence Advisory Committel. on 25 July 1952
(LAC-)-53/1) and amenoel by TAC-D-53/3.1 of 25 February 1953.
IT. Orcarization of the Intelligence Working Group
The -.ING is co;Tosed of re,Abers from tie intelligence sectors of the
Departments of State, Army, favy, cnd Air Force, are the Central
Intelligence AzenJ:,.r. Associate membership is hele by the ffice of the
AdLinistretor Defense Assistance Control of the Foreign
C2eratdons 10ministration, the Office of the Secretary of Defense, the
Foreign Operations Adninistraton, and the Departments of Commerce,
Treasury, and State (Economic Defense Staff and Office of Munitions
Control). Any other acency havng interest or competence in the field ?
of economic defense intelligence may be invited to sit with the Group.
cu/aR provides the Chairmen and the Executive Secretary.
During the past year fourteen subgroups were established to provide
TM with specialized research and technical advice in sp.,-cific f/elds of
economic defense. Five of the subgroups arc currently operative. The
otners have completed their assignnents.
III. Purpose of 1HO and Relationship to EIC
The ruG is unique within the U.3. Government in acting as an inter-
agency service facility for the review, coordination, and production of
timely economic intelligence which is directly applicable to current or
impending problems of economic defense policy or operations and is not
exclusjvcly within the mission or responsibilities of apy existing
ap;ency or interagcncy groups. Its purpose, as stated in its TC.VmS of
Reference istlo develop and furnish intelligence to the EDAC for policy
making and operations in the economic defense field...and to develop
closer continuous relationships among the operrAions, policy-formulation,
and intelligence-research elements engaged in the economic defense program."
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The role ef the IWG differc from that of the Economic Intelligence
Committee (MC) which is responsible for "fundamental economic
research...relatine to the national security." The NU looks to the
FTC and other research facilities for basic research support.
IV. Responsibilities end Accomplishments of the TWG
A list of all cases which have been formally placed before the
Ar, for consideration will be found in Tab A. Most of these cases
have rcaulted in the preparation of papers (listed in Tab B) which
have been furnished to EDAC components.
The major responsibilities placed upon the TWG under its Terms
of Refer3nce, together with an indication of the 1WG's progress during
the past year in meeting theme follow:
A. Responsibility: Prepare or arrange for the preparation
of reports which preeent the bast available economic intelligence on
problems of concern to the EBAC.
Progress: TheTWG has prepared twenty-one papers involv-
ing research and analysis in particular fields of economic defense
(Tab 13). Ten were concerned primarily with strategic commodities while
six were in the field of shipping intelligence. The remainder involved
export controls generally. The IWG is now being used as the mechanism
through which intelligence studies of the Soviet bloc supply position and
strategic uses in the bloc of specific commodities are prepared, reviewed
arid coordinated.
B. Responsibility: Provide current intelligence to the !DAC
in response to specific requests or on its own initiative.
Progress: Tho TWG has boon instrumental in providing
current intelligence to assist action agencies in mecting.their current
or impending problems of economic defense policy or operations. Of
nineteen papers of this nature prepared by TWG', fifteen have been
significant items of intelligence in the shipping and commodity move-
ment fields contributed by the ONI member for use by E)AC (see Tab C).
In addition, several urgent requests ky. action agencies have been
handled under the aegis of the rwG directly by analysts in the several
intelligence agencies, time not having permitted the matter to be
formally placed on the TWG agenda for mview.
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The effort nude by IWO to establish procedures for the
collation of current intelligenco for the purpose of providing notion
agGncies with the procossad intelligence they require as a battle for
prevcntivc and/or ramcdial action is covered in the statement of progress
under subsection D and Tab El, following.
C. See onsibili Dotormine the necossity? desirability, and
feasibility o?bt thing rther informntion or intelligence concerning
the subject matter of specific reports or to fill specific gaps, and
recommend action by appropriate agencies to meat theft needs.
Frogrosst
1. An IMO subgroup was ettablishod in rosponeo to a
specific request of tho EIC Subcommittoe on and Facilities
for Collation. to prepare "a consolidated set of requirements for
collection...on East-West trade". This subgroup was instructed to
ascertain avisting guidance to collection agoncios, formulate recommenda-
tions for ovor-all priority rcquirements for ca3.s.:U=6 identity
critical deficiencies in fulfilling such requirements, and ike
appropriate corroctive rocommendations (sec Section V.). .
2. An WO paper, neport on COCOMI Statistical
Reporting," pointing out inadequacies and deficionCieS it the reporting
system, was forwarded to ESAC to be used hy that Committoe as the basis
for the preparation of an instruction to the U.S. recgste to COGOM.
3. Various agencies have tormatated. and served
detailed collection requirements upon appropriate collection agencios
to obtain flirt/it-r information or intelligence comprging tale subject
matter of specific reports or to fill specific mgp$.
D. Respetaitdlityt Arrango for the mobilisation of the
economic data =almanacs relevant to appropriate tamdssof the MAC.
Progrosst four principal development* (sea Tab D) having
beftring on the above responsibility, Moro*
1. Recommendation tor the establishment in CIA of
a unit to process current economic dates= intelligence and to collate
such intelligence for use of the operating agencies. This rocommnda.
tion was approved and the unit has been set up.
2. Establishment of tmdfaralfroccdures for thb
production and appraval for release of VG papers.
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3. Preparation of rocciando1 isstauctions to lho
ric1.1 for the lateral disbrihotion of earront intolliscage cc ourPootol
'ay:asks+ of ocartrolled convocation to the Soviet bloc was 000rdisatod
area& the
25X1 cu
ozioiale of ttsl of a lasorandoo tOer==too
liatiog tow catogoriss Abut
soviet bloc pant that is of sigatficamco to tin IWO and the MO
rigcneine and requcating tribotioa to NO of all aostroca faLling
thin ti dis
ne oatogories.
V. oftz pro. As.......aftlas.wa and ? ran
A. Statement of LS. 1iqy Pertincat to Ze Ahtivitios
The an J. 'racy dirsotivo m ths field ot 4Idendold
defocus till guide ?NO add WO actilitior awing the *Was year.
PeIrticularl: partial!** ere OmM1mii jaattne rogoirbig
game IMPPolet as outlined la Una dime rot CO nr tap alvela.,
tatty and uttlintion ot carroot istallig000e is ralatiag to
enforcement of control, chich lona boon *Mot Itt the free Writ
C2) Devslop ancillary ansurvi including ocatrol over *molt trace
and transshipments tree port olitivittret tinunnisa coatligis tr6 alackm
lis tinc, to improve lapleuantati.en nod infacconst et avr?oi oontoki
systemise particulariy. control over otroiagio oossmoditini ()) tighten
thc aostrol list criteria fad mks the otratagic rating of comedian
on the oontrol 1-:sts to prasidla Sir the selection of commoditioa which
eaotribato siguitissoily to Vie 81091114 podsdAlial.
13.Di t4 .12a
1. 'to provide Um intaLligarpo iampart siausttial to
tato taploceatation of tho nos 11.3. platy. tam 311111 oat tatemity its
ottarta to *Wm ourreat coosooto &Soft littellipmeo made* to want
amain. A Najor formard atop boo boon tho oreattoo, at the mutat of
Ms of the currant intolligoaao nit within CU. This sat sanoot
opera* at anion offectivouns hymn, velem ago aro Anne to Judge
ittablur Priorities to the oollaction et totoriettio rams* cooncada
derma. it also mg be nippropititin taw WI to intptiro Into tio
eicses of day is the tramodasion to bimetal of lastitost trade
infornattaa ani its dissenLeation to * agesica. approval out
trplascrttation of pavan imam:4i for lateral distribution of
East-weat trade internam in the stoolid facilitate the prevention
of trade control viotatLons.
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SecuFiTy7Trif3rgation
U.S. oFFIcias ONLY
2. The tightening of the criteria for the selection
of commodities which contribute significantly to the Soviet bloc war
potential will place an additional work load of commodity review and
analysis upon the TO. It will require increased vigilance on the part
of the intelligence agencies in the detection of changing economic
vulnerabilities within the bloc. The extent of this work load will be
dependent upon the outcome of the programs being developed by the
action agencies having responsibilities under this now policy directive.
3. The full potential of the TWO for intelligence
support has not ytt been utilized by motion agencies or working groups
of the EDAC structure. TWO/AM-8, distributed in, E)AC as MAC D-48,
establishes a mechanism by. which MAC agencies (and working groups
within the E)AC-ACEp structure) may request direct intelligence support
from thc TO. These established procedure mare assisting the action
agencies and interagency work groups in drawing upon the TWO facilities.
In furthering this effort to MAXiIMIZO the contribution of thc 'Iwo as
the focal point of intelligence support for economic defense, CI& is
now putting through the Group for review and coordination most of its
intelligence, including commoditr analyses, which formerly went directly
to other working groups. It is hoped that the objective of realizing
the full potential of the MO will be reached during the coming year.
A.
25X1 A9a
enair
Intelligence Working Group
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TAB-A
113T OF ALL rwo CASES
August 1931-:-July 1953
TgG nesignatri'm- Title
BJC, Case No. 1 Proposed Shipment 2,000 Tons Copper from Turkey to
Communist China
TJG Case No. 2 Soviet Bearing Production and Procurement
TJG Case No. 3 Prior Commitments
_NG Case No. 4 Greek Shipping Cartel
IWG Case No. 5 Greek Flag Merchant Ships Trading with Communist
Far East
TgG Case
No. 6 DDR Procurerent Efforts
NG Case No. 7 Collection Requirements on East-West Trade
IWG Case 147. 8 Belgian Ships for USSR
IWG Case No. 9 Merchant Shipping Intelligence
NO Case No. 10 Danish Tanker APSHERON
PIG Case No. 11 Chinese Communist Trade
TgG Case ro. 12 Radar Carried by SS FRYDRYK CHOPIN
TG Case No. 13 Sale of TAVIRA (foruerly ATIANTIC II, now PRACA)
to Poland
TG Case No. 14 Activities of INTERCONTINENTAL AIRWAYS
TG Case No. 15 Alleged Refuelling of Polish Ships with Iranian Oil
TgG Case ro. 16 Delivery of Antimagnetic Schooner by Finland to the
Soviet Union
IWG Case No. 17 Cargoes of Oil Carried by Polish Ship RYSY,
Rotterdam to Gdynia
IWG Case No. 18 East-West Monetary Transfers in Germany
IWG Case No. 19 Exploitation of Intelligence on Soviet Materiel
(Foreign Equipment)
RIG Case No. 20 EDAC Operational Memorandum for IWO Activities
IWG Case No, 21 Diversion of Korean Scrap to Communist Destinations
IWG Case No. 22 Western Repair and Construction of Merchant Vessels
for Soviet Bloc
/iv 4)
ma Case No, 23 Activities of FRITZ DIEPENv?cor
IWG Case No. 24 Chinese Comnunist Procurement of Power Generating
Equipment
114G Case No. 25 Illegal Sale of MDAP Armament to Eastern Europe
IWG Case No. 26 Bunkering of Vessels in China Trade
IWG Case No, 27 Soviet or Satellite Chartered Vessels and Merchant
Vessels Trading with the Communist Bloc
IWG Case No. 28 N. V. Philips Co., Eindhoven, the Netherlands
TWG Case No. 29 Spectrograph for Institut for Anorganische Technologie
dcr TechnischenHochschule, Vienna, Austria
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TAG Cnse No. 30 Sale of Italian-Built Ship to Bulgaria
114G Case No. 31 EDS Request for Technical Analysis of Repairs to
Soviet Vessels in Port of Antwerp, 1949-1952
rim Case No. 32 Request for Intelligence Evaluation of Soviet Bloc
Cobalt Production Capabilities vs. Requirements
IWG Case No. 33 Request for Intelligence Study on the Movement,
Including Transshipment, of Strategic Commodities
from the Middle East to the Soviet Bloc
TAG Case No. 34 Smuggling from the Ryukyus
Din Case No. 35 Polish Coal Situation
TgG Case No. 36 Intelligence Data for U.S. Delegate to CHINCOM
FAG Case No. 37 Intelligence Requirement - Transit Trade Involving
Sweden and Switzerland
TAG Casc No. 38 Finnish Tanker Fixture for China Run
IWG Case No, 39 U.S. Yining Equipment for Upansion of Spanish
Pyrites Production
DIG Case No. 40 Reported Movement of Rails from ,Antworp, Belgium,
to Constantsa, Rumania, by Costa Rican, Tarkish
and Italian Vessels
TAG Case No, 41 Dissemination of Economic Defense Intelligence in
the Field
DIG Case No, 42 Communist China - French Barter Deal for NitrOgenOW
Fertilizer
TgG Case No. 43 Request for Information on Strategic Importance of
. Hides and Leather to Soviet Bloc, Particularly
Communist China
IWG Case No, 44 Financial Operations of the Soviet Bloc in its
Economic Relations with the Free World
TgG Case No. 45 Soviet Efforts to Procure Aircraft Parts and
Components
IWG Case No. 46 Strategic Importance of Dichlorodifluoromethane
(Freon 12) to the Soviet Bloc
IWG Case No. 47 Swiss Bank Financing of Strategic Exports to the
Soviet Bloc
IWG Case No. 48 The Tractor Situation in the Soviet Bloc
TgG Case No. 49. Diversions to the Soviet Bloc of Strategic Materials
Originating in Non-COCOM Countries (South Africa:
lead; Bolivia, tin, tungsten)
IWG Case No. 50 Strategic Importance of Magnetic Recorders and/or
Reproducers to the Soviet Bloc
TWG Case No. 51 Strategic Importance of Kyanitc to the Soviet Bloc
IWG Case No. 52, Pharmaceuticals: Communist China's Supply Position
in ;intibiotics, Anti-Malariale and Sulfanomides
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Title
TAB-A
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TAB-B
LIST OF ALL DIG SMIES COMPLETED OR IN PROCFSS
August 1952 - Jull'1955
Wri Designations
- T4G/AM-9 "r-fr'
- PIG/AM-10 ji.g,4-7
DIG/D-1 elc (72
TIG/D-2
DIG/D-3
DIG/D-5
' PIG/D-6
DIG/D-7a
114. 31
Tairl/n-8c
- PIG/D-12 //7
8,1
v-DIG/D-19 /fi3-2
DIG/D-31 ,
IWG/D-33a
-IWG/R-1 eft (7)
dIWG/R-5 PPII/cAi
1WG/R-6 )2
/:
*IWG/R-8
'it-rviG/R-9 /1 01
4 IW /.7 ? s'
Title
Table of New Construction in Hand and on Order in
Western Countries for USSR Merchant Fleet -
June 1952
Glycols - Item IL 1727
Conveyor Belting and Item 310b - Power Driven
Conveying Equipment
Danish Tanker APSHERON
Utilization of Soviet Bloc Merchant Shipping
Intelligence by the Urdtcd States Coast Guard
ONI Report on Western Shipyard Services to Soviet
Merchant Fleet, 1 January - 30 June 1952
Soviet Metallurgical Techniques
Chronology of COM Transit Trade Control Discussions
Specification Sumnarics for Soviet Ships Repaired in
Antwerp Yards, 1949 - 1952
Response to ODMS Questions Regarding Soviet Bloc
Cob-qt Position
Jnpancse Security Export Controls on Trade with
China - 1945/1952
Movement of Scrap Metals from the Middle East - 195261r
Strategic Importance of Dichlorodifluoromethane
(Freon 12) to the Soviet Bloc
Strategic importance of Magnetic Recorders and/or
Reproducers to the Soviet Bloc oat-
Alleged Refuelling of Polish Ships with Iranian Oil
Communist China's Imports of Antiontum Sulfate
Report on CCCOM Statistioal Reporting
Soviet Bloc Kyanite Position
Examples of the Role of Sass Banks in Financing of
East-West Trade Since 29 August 1952
The Tractor Situation in the Soviet Bloc
Material for Use in China Committee
* All of these studies lik-re completed in the period August 1952 - July 1953
cxcopt those marked with a single asterisk.
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LIf'T OF .ALL TWG CUiLirNT INTELLIGENCE CONTRIBUTIONS
????? 4?? ???=. w?rimem.?
Luelst?M2 =Minn
PIG Decifination
-'7PTO/AM-7
PL/D-13
JG/D-114
rY)/D-15
rz/D-16
In/-l7
It. JO /D -18
TIG/D-21
r rip -22
BIG/D-214
- 25
pm/D-26
r -27
IWG/D- 28
r TG/D-29
IWG/R-3
TJG/11-14
raVID-f
Title
Finnish Tnnkrr Fixture for China Run
ONI Infornation on Movements of Specified Ships
CNI Information Regarding Mership 9OLGH MERCHANT
ONT Contribution - Cargo Information on Vessels
in China Trade
ONI Information Regarding SS MUZAFFER
ONI Inforvation on Greek Mership T* Txas
oia Information on "Shipments of Strategic Materials
through the Bosphorus to the Soviet Bloc from
28 August to 31 December 1952"
ONI Information on Movement of Strategic Materials
from China to Poland
ONI Contribution - Shipment of Strategic int,I.rials
from Beirut, Lebanon
on, Contribution - Metal Ecrlp Novements to Poland
ONI Information Regarding lierchent Vessels in the
China Trade
On Contribution - Cargoes Transshipped at Hamburg
for Czechoslovakia
ONI Contribution - Strategic Commodity Movements to
Soviet Bloc
ONI Contribution - Voyage of Portugese Mership TIMOR
from Europe to Hong Kong and Macao, January -
February 1953
ONI Contribution - Cargoes Transshipped via Hamburg
for Czechoslovakia
ONI Contribution - Transmittal of Mrchant Marine
Intelligence Regarding Bunker Controls
CIA Statement on Rndar Reportedly Carried by
SS FRYDRYK =FIN
Shipment of Steel Plates from Japan to Eastern, Germany
Foreign Sale of Fastax High Speed Film ?
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PrZINCIL TDEVELOPI-LITTS IN THE MOBILIZATION OF EcoNmac
15-7,t771t117:Firl-6- VITT Or talc
1. Establishment of Procedure for Processiu Current Economic Defense
Intelligence
In responsc to a request of the Steering Oroup (new Executive
Committee) of PDX, TWO prepared and forwarded to CIA a paper
(]WG/CI-2 of 5 February 1953, as amended 3 March 1953) which pointed
up the deficiencies of then-existing arrangements "for processing the
.:onsiderable amount of raw intelligence and incompletely-evaluated
intelligence now being received regarding Soviet bloc procuremnt
activities." This pap-r recommended that "the CIA designate a unit
within that Agency to process current EasteMest trade intelligence
for the purpose of serving through the 140 the needs of the EDAZ
structure." By memorandum of 16 March 1953, the Assistant Director
for Research and Reports, CIA, approved the establishamnt of such a
unit. It is now functioning on a limited basis and is expected to be
in full operation by mid-September.
2. Establishment of rwo Procedures
Administrative Memorandum, r4o/sui-8, prepared by IWO and distributed
by the Executive Secretary, EDAC, throughout the MAC structure, provided:
(a) uniform procedures for the production and subsequent approval for
release of DIG intelligence; (b) furnished a sumnary of current pertinent
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TAB D
instructions covering diseamenation of econoeic defense intelligence to
U.S. Government ag,ncies and foreign nationals; and (c) outlined proce-
dures to be follow d in the establishernt of TUG subgroups and in the
production of IWG reports.
3. Lateral Field Dissemination of East-West Trade Information
At the request of the Chairman, EDAC Steering Group (now Executive
Committee), the ING undertook to coordinate the interagency preparation
of instructions to field representetives for lateral distribution of
current intellisence concerning suspected diversions of strategic con-
eodities to the Soviet bloc. It is understood that the Department of
Defense will issue similar instructioes to its intelligence representa-
tives oversees upon receipt of agreed 'instructions to the foreign
Service covering State, Commerce and CIA.
4. Intelligence Exploitation of Soviet Bloc Equipment
25)(11i4ae INC distributed to each of its three Service members, to Chief,
CIA, and to the Director of the Joint Material Intelligence
Agency (naw Joint Technical Intelligence Subcommittee of JIC) a ix:reran-
dum listing four general categories of information about Soviet bloc
Lquipment of significance to the I nd the EDAC agencies. Cooperation
of the Director, JTIS, was requested to
and intelligence prepared by his Agency
analyses have been useful in connection
gcncc on the quality and composition of
tion within the Soviet bloc.
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insure that relevant analyses
were furnished to the ING. Such
with the development of intelli-
commodities and methods of produc-
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IWG INTELLIGENCE SUPPORT TO THE ECONOMIC DEFENSE PROGRAM
ADMINISTRATOR OF MUTUAL
DEFENSE ASSISTANCE CONTROL ACT
(P.L 213, 82nd CONGRESS)
SECRETARY OF STATE
I ECONCIMIC DEFENSE
ADVISORY COMMITTEE
(EDAC)
(1, 6-16)
tl, 7-9, 15. 161
(EDAC/E0 10.?
MAC EXECUTIVE
COMMITTEE
EOM INCOMING SIMON
tort PEW Nismois
Nosiback. mcd IEMaimmaset
OR Tommomt CmONsii
Terme
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OmmONING 111411mms
For EimIent laroxile Wefts
NOTE: Dashod floss erwhosto Row
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(7-10, 15.171
PARTICWATING AGENCIES
PRAISERS ON OtAIT ONXICAN AleaTICIPANTS
I. CIA
2. STATE CR)
3: G-2
4. ONI
5. AFOIN
6. AEC
7.
DEFENSE (050)
13.
AGRICULTURE
9.
STATE (E)
14.
INTERIOR
9.
COMMERCE
15.
MDAC
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TREASURY
16.
FGA
11.
ODM
17.
STATE (OMC)
12.
EX-1M BANK
SECRETARY OP COMMERCE
(P.L 11, 81st CONGRESS)
I ADVISORY COMMITTEE
ON EXPORT POLICY
CACEPI
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OPERATING
COMMITTEE
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