CURRENT INTELLIGENCE BULLETIN - 1952/03/04

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02623669
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 8
• Document Creation Date: May 24, 2019
• Document Release Date: May 30, 2019
• Publication Date: March 4, 1952

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SEC UFFATION
4 March 1952
CURRENT INTELLIGENCE BULLETIN
DOCUMENT NO.
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Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
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SEC INFORMATION
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SUMMARY
FAR EAST
L Tapanese-Chinese Nationalist treaty talks hit snag (page 3).
2. Bacteriological warfare in Korea now major Communist propaganda
theme (page 3).
3. Chinese Nationalist official urges repatriation of Indochina internees
(page 4).
NEAR EAST - AFRICA
4, Egyptian King prepared for test of strength with Wafd Party (page 5).
EASTERN EUROPE
5, Yugoslav Foreign Minister admits leftward shift in party policy (page 5).
WESTERN EUROPE
6. Bonn wants to ship scrap to Czechoslovakia (page 6).
7. No important French industrialist plans to attend Moscow Economic
Conference (page 7).
8. Italy blocks new attempt to divert aluminum to Orbit (page 7).
9. British economic situation becoming desperate (page 8).
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FAR EAST
1. Japanese-Chinese Nationalist treaty talks hit snag:
The main obstacle in the current Japanese
peace treaty negotiations with Nationalist
China is a Chinese demand that the treaty
must apply to all of China, according to the
Japanese Vice Minister of Foreign Affairs. He advised the US Political Ad-
viser in Tokyo that Japan could not accept this proposal even if the terri-
torial scope of the treaty were modified in a separate document as suggested
by the Chinese.
Comment: Prime Minister Yoshida, in his 24
December letter to Ambassador 'Dulles, committed Japan to negotiating a
limited treaty which should be applicable to "all territories which are now
or which may hereafter be under control of the Nationalist government.
The Taipei government, both for reasons of prestige and for protection of
its position in the UN and other international bodies, wishes to avoid any
admission that it lacks actual control over the mainland.
2. Bacteriological warfare in Korea now major Communist propaganda theme:
A North Korean east coast defense unit was
alerted on 1 March to hold protest meetings
among the troops to intensify "hostile feelings"
against alleged bacteriological warfare by the
UN forces. The addressee was admonished to
"make sure they (the troops) are awake at the
lecture,"
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China's concern with this issue is reflected in
a report from Indian Ambassador Panikkar stating that "explicit, apparently
documented, charges of bacteriological warfare efforts by the United States"
have been accepted as true by Chinese Communist officials.
Comment: The entire Soviet Orbit continues to
give unusual prominence to the bacteriological warfare charges, and Com-
munist China has reportedly dispatched "anti-epidemic teams" to combat
the UN's alleged BW campaign in Korea. A Communist correspondent at
the truce talks reported that the charges lend "a most sinister aspect to
the new American delaying techniques in the conference tent, "and predicted
that the full effects of BW will become evident as the weather gets warmer.
There is still no evidence of an epidemic in
North Korea sufficient to justify the current all-out propaganda effort of
the Communist world.
3. Chinese Nationalist official urges repatriation of Indochina internees:
The Chinese Nationalist Consul General in
Saigon told French Minister for Associated
States Letourneau on 25 February that the
morale of the interned Chinese Nationalist troops
in Indochina has sunk to "a new and dangerous ebb." He urged their immedi-
ate repatriation to Formosa as the only solution.
The Chinese official said that Letourneau, while
not yet prepared to advocate outright repatriation, stated that it might be
possible for some such organization as the International Red Cross or a
specially constituted UN committee to solve the internee issue.
The Consul General also told Minister Heath
that both Acting Commander in Chief Salan and Inspector of Overseas
Troops Valluy have expressed the view that repatriation is desirable.
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Comment: The late Marshal de Lathe con-
sistently opposed repatriation of these Nationalist troops, which originally
numbered about 30,000 men. However, an official of the French Foreign
Office stated in January that his successor, General Salan, favored their
release but has advanced no proposal to effect it.
NEAR EAST - AFRICA
4. Egyptian King prepared for test of strength with Wafd Party:
King Farouk was prepared by 27 February,
three days prior to the change of government in
Egypt, to force a showdown with the powerful
Wafd Party. 1
� The King's eagerness to eliminate corruption
in Egypt and to prosecute those responsible for the January riots in Cairo
is so strong that he has even considered suspending the constitution for
three years in order to achieve this objective.
EASTERN EUROPE
5. Yugoslav Foreign Minister admits leftward shift in party policy:
--Foreign
Minister Edvard Kardelj admitted that the
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Communist Party of Yugoslavia has veered to the left in order to quiet the
misgivings of party regulars over recent official deviations from classical
Communist theory. Kardelj declared that further rural socialization is
necessary and predicted the eventual success of "peasant collective associ-
ations," He maintained that the present capital investment program is
based upon the minimum industrialization required for Yugoslavia's needs.
� Comment: A significant leftward shift in party
policy has become increasingly apparent during the past month. Increased
official anti-religious activities and emphasis on the need for better party
discipline highlight this recent trend.
WESTERN EUROPE
6. Bonn wants to ship scrap to Czechoslovakia:
West Germany is putting increased pressure on 3.3(h)(2)
the Allied High Commission for authorization to
ship 25,000 tons of scrap metal to Czechoslovakia.
This scrap was allegedly promised under pre-
vious trade agreements. Allied officials are now considering whether all
or part of the shipments should be prohibited as a violation of the Battle Act.
The Germans argue that if the shipments are
not permitted, the Czechs will carry out a threat to stop deliveries of coal
to the Federal Republic, and that current negotiations between the two
countries for a 1952 trade agreement will be jeopardized.
Comment: The Czechs shipped over one mil-
lion tons of brown coal to Bavaria during 1950 for industrial use. High
transportation costs make it economically infeasible for Bavaria to obtain
brown coal from the Rhine Valley, West Germany's main producer.
The West Germans have argued that retaliatory
suspension of coal shipments from Czechoslovakia would further aggravate
the coal situation in the Federal Republic, already affected by domestic
demands as well as by the stoppage of East German shipments to Berlin.
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. No important French industrialist plans to attend Moscow Economic
Conference:
reports that
the prospective French delegation to the Moscow
Economic Conference now comprises for the
most part only fellow travelers and less impor-
tant businessmen. Although some key industrialists were initially tempted
to attend either to promote trade with the Soviet Orbit or to strengthen
their position with Communist-dominated unions in France, they have de-
cided not to risk the possible consequences for their personal and business
relations with the United States.
Comment: The combination of raw material
deficiencies and an acute dollar shortage has made French industrialists
susceptible to offers of trade with the USSR, Communist China, and the
Satellites. Nevertheless, while France has shown more interest in the
conference than any other country in Western Europe, enthusiasm has
dwindled as the political aspects of the trade overtures have become increas-
ingly apparent.
8. Italy blocks new attempt to divert aluminum to Orbit:
the first case of its kind since the tightening
f trade controls a few months ago, the Italian
overnment recently blocked a 600-ton shipment
f Italian-produced aluminum to Rumania. The
metal w�stensibly licensed for the United States. It was loaded in Genoa
on a Norwegian ship, but impounded in Naples the following day.
Comment: Earlier reports indicated that sub-
stantial amounts of aluminum have been transshipped through Italy despite
the recent temporary suspension of import licences. Some 3,200 metric
tons of aluminum are believed to have been shipped from or transshipped
through Italy to Orbit countries via Basel and Antwerp between June and
December of last year.
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9. British economic situation becoming desperate:
Mutual Security Agency officials in London
estimate that a continuation of the British dol-
lar drain at the current rate would seriously
threaten Britain's entire economy. They be-
lieve that the situation "may well be approaching desperation."
Chancellor of the Exchequer Butler "sees hope"
if Britain can survive the danger period of the next few months. He be-
lieves the scheduled 300 million dollars of American aid, if transmitted
quickly, will make a vital contribution. The MSA mission stresses the
importance of granting the whole amOunt as soon as possible to avoid the
shock of an announcement of further large losses in British reserves.
Comment: During the last three months of 1951
sterling area gold and dollar reserves fell by nearly a billion dollars. It
had been anticipated that the effects of the import cuts made shortly after
the Conservative government took office would not be reflected in the ster-
ling area reserves before the second quarter of this year.
Under the conditions now attached to US aid
only a fraction of the 300 million dollars agreed on in December can help
the British gold and dollar position before July.
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