DAILY DIGEST

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000500220001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 18
• Document Creation Date: December 12, 2016
• Document Release Date: February 7, 2002
• Sequence Number: 1
• Publication Date: November 9, 1951
• Content Type: SUMMARY

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TOP SECRET
SECURITY INFORMATION.
9 November 1951
CIA No. 49420
Copy No.
ltr?
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 Dept. review completed
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SECURITY INFORMATION
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SECTION 1 (SOVIET)
1. BULGARIA. Power and fertilizer -plants com-pleted: Ceremonies marking
the completion of the Stalin nitrate-fertilizers plant and the Cherven-
kov (Maritsa III) thermoelectric plant were held in Dimitrovgrad on
5 November. Premier Chervenkov, Soviet Ambassador Budrov, and Minister
of Heavy Industry Yugov were among those who spoke at the inauguration.
Great stress was laid upon the role played by "thousands" of Soviet
specialists in making possible the successful completion of the plants
fully two years ahead of schedule. (R Sofia FBID, 6 Nov 51)
Comment: The Chervenkov thermoelectric plant is expected to supply
power to a considerable area of southeastern and central Bulgaria as
well as to various industrial activities located at Dimitrovgrad. The
Stalin plant will provide nitric acid for the production of ammonium
and calcium nitrate fertilizers. Nitric acid and ammonium nitrate are
used in the manufacture of amatol and TNT explosives.
Although Bulgaria greatly needs power and fertilizers, it would
appear that the sudden rush to complete the Chervenkov and Stalin
projects in 1951 was based as much upon propaganda considerations as
upon actual economic need. Publicity given to the "labor heroism and
unheard of speed" manifested at Dimitrovgrad has served effectively to
overshadow the failures of Bulgarian industry in other sectors of the
economy.
2. POLAND. Poles believed to have co-py of International Export Controls
Lists During the current Polish-Swedish trade negotiations, the Polish
negotiators have made constant references to "list I" and "prohibited
items." A high Swedish official told a member of the'US Embassy in
Stockholm he understood the Poles had been given or shown a copy of
the International Export Control Lists by West German export control
authorities. (S Stockholm 603, 6 Nov 51; 616, 7 Nov 51)
Comment: Considering the terminology used by the Polish negotia-
tors, there can be little doubt that they are familiar with the Inter-
national Export Control Lists. This familiarity enables the Poles to
know exactly upon which strategic items to apply pressure when negotiating
with the West.
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4.
RUMANIA. Economic plan fulfilled in third quarter: The Rumanian Govern-
ment has announced that the over-all industrial production goals for
the third quarter of 1951 were fulfilled by 101.5 percent. Only three
major production categories (building construction, food, and "timber,
paper, and cellulose) failed to reach their targets. All others over-
exceeded their goals, including coal and petroleum (102.9 percent),
electric power (105.1 percent), and transport (118.7 percent). Press
comment particularly lauded the joint Soviet-Rumanian companies for
major triumphs. (R Bucharest 201, 3 Nov 51; FBID 31 Oct, 7 Nov 51)
Comment: Rumania is the only Eastern European Satellite to claim
over-all industrial fulfillment of its economic plan.
YUGOSLAVIA. US agrees to sign arms agreement with Yugoslavia: In light
of recent Yugoslav concessions regarding the size and duties of the US
arms aid group, the Departments of State and Defense have agreed to con-
clude the bilateral arms aid agreement with Yugoslavia. Embassy Bel-
grade has been authorized to prepare the final text for signature
following Ambassador Allen's return from Paris on November 12. (S to
Belgrade 499, 7 Nov 51)
Comment:. The Yugoslavs have agreed to accept an initial US arms
aid staff of thirty and pledged assurance that the supervision of the
use of the material will be carried out in a cooperative manner.
General Harmony, who will head the US military group, will work out the
detailed implementation of the agreement upon his arrival in Belgrade
near the end of the month.
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SECTION 2 (EASTERN)
1. INDIA. Indian Forei Secretary's statement on Communist China: In a re-
cent addrress etore the new American, French, and-Belgian Ambassadors to
India, Foreign Secretary K.P.S. Menon made the statement that "India. has
gained nothing in a material:. sense and perhaps has lost something by rec-
ognizing (Communist) China. Similarly, the United States has gained little
in a material sense and perhaps has lost little by refusing to recognize
China." (U New Delhi 1626, 6 Nov 51)
Comments This is a most unusual statement for a prominent Indian of-
ficial o make before diplomats almost certain to report it to their re-
spective governments. Though it probably does not reflect any change of
attitude on the part of Prime Minister Nehru, who is also Minister of Ex-
ternal Affairs, it may indicate that certain segments of Indian official-
dom now have some doubts as to the wisdom of India's precipitate recogni-
tion of the Chinese Communist regime.
2. Three oil refineries to be establisheds Three oil refineries may
be operating in India within the next or three years, according to.
Indian press reports. Negotiations are seid to be in an advanced stage
between -the Indian Government and the Standard Vacuum, C altex, and Burmah
Oil Companies, the first two'of which are prepared to i*lreat 30 million
dollars each and the last 10 to 20 million pounds sterling. The closure
of the Abadan refinery and the uncertainty as to its future are said to
have stimulated these negotiations. (U New Delhi 1624, 6 Nov 51)
Comments India, though sympathetic to Iranian aims, is nevertheless
concerned over the safety of its oil supplies. The degree of its concern
is evident in a report that the foreign oil companies will be allowed to
control, manage and operate the refineries, an arrangement contrary to
India's basic policy of eventual control or nationalization of all key
industries.
BURMA. De Lattre and MacDonald alarmed over Burmese situation: General
de`-attre told the UR Coni-ul in Hanoi that he is seriously worried over
the menace to Burma. He believed that Burma is threatened more by in-
ternal pressures than by a Chinese Communist invasion. He partially
blamed Nehru's "antics" toward the West for Burma's weakness and criti-
cized Britain's?negative attitude toward both Nehru and Burma.
Meanwhile, the British Commissioner General for Southeast Asia,
Malcolm MacDonald, in reviewing the politico-military situation in the
Far East for a group of US Congressmen visiting Singapore, stated that
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4.
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Burma is the weakest spot in Southeast Asia and that the government
needs outside aid to prevent collapse-as a result of undermining tactics
by the Communists. (S Hanoi 307, 7 Nov; C Singapore 537, 6 Nov 51)
Comment: De Lattre and MacDonald are now meeting in Indochina to
discuss the problem posed by Burma.
Comment: A number of recent reports indicate that Premier Phibun
is backing Sarit in an effort to reduce Phao's political and military
influence. The King, except for a short visit for his coronation, has
been away from Thailand continuously for several years and is unlikely
to wield any great influence in Thai politics in the immediate future.
5. INDOCHINA. De L attre sa s ?rice of French effOrt in Indochina is
greater contribution by Vietnamse:_ General d I,attre told US Consul
Blancke in Hanoi that Tran Van Huu would be retained as Premier fnr the
time being at least, but that unless Vietnam can produce a proper budget
it was not impossible that the French Government might be disposed to
pull French troops out of Indochina over De Lattre's own objection. The
general declared that Vietnam could no longer remain a critical spectator
but must measure up to its responsibilities both financially and in man-
power for self-defense. (S Hanoi 307, 7 Nov 51)
Comment: Vietnam is now committed to devote between 40 and 55 per-
cent of its meager budgetary receipts to defense costs. Any further
paring down of the minimum social and economic programs of the Vietnam
Government would detract from what little popularity it now enjoys. As
for manpower, there are now some 200,000 Vietnamese among the anti-Commu-
nist forces in Indochina as compared with some 60,000 Frenchmen.
6. Vietnamese Premier rraised for resisting "French meddl
An editorial in the 3 November issue of one of the major Vietnamese
language newspapers of Saigon urges the presence of Premier Tran Van Huu.'
at the forthcoming French Union conference in Paris on the ground that
Huu "has many times prevented backward Frenchmen from meddling in our
internal affairs." (C Saigon 974, .6 Nov 51)
Comment: This newspaper, which is subsidized by Huu, has followed
the, Fren~ _Comment:
amity line during all of 1951. The shift in
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L
o
e
rival General Sarit Assistant Commander in
17
THAILAND. Phan attempt n to win r & supz~ort: Police Director
Iri anc~I is re orted to be
General.Phac y p nrt a ainst his political
making a determined effort to win royal supp g
f the Army.
f
Chi
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editorial policy reflects Huu's effort to strengthen his now very
feeble popular following in order to arm himself politically against
the growing enmity of General de Lattre. Huu has generally been con-
sidered pro-French, although he is capable of opportunistic criticism
of the French authorities.
7. SOUTHEAST ASIA CHINA. US Congressmen briefed on the Far East: The
British Commissioner General for Southeast Asia, Malcolm MacDonald, in
reviewing the politico-military situation in the Far East for a group.
of US Representatives visiting Singapore, stated that although Indochina
was tic "easiest highway" by which the Chinese could conquer Southeast
Asia, DeLattre had effectively barred this road. MacDonald believed,
therefore, that Burma was the weakest spot in the area.
Touching on Malaya, he said the "emergency" would probably endure
for "a very,very long time," but that even if Burma, Indochina and Thai-
land fell to the Communists, Malaya would definitely hold out.
With respect to Communist China, MacDonald stated that the Peiping
regime is "obviously" in firm control of the country and is less corrupt
and more efficient than its Nationalist predecessors but that Peiping's
program of terrorism has resulted in a "great swing away" from popular
support of the regime. Speaking off the record9 MacDonald stated that
Speaking generally, MacDonald said that political freedom in South-
east Asia inevitably aeant administrative inefficiency and corruption
which provided fertile ground for Communist exploitation. He felt that
the West should take this fact into consideration in formulating policy
toward the peoples of the area. (C Singapore 537, 6 Nov 51)
Comment: MacDonald is widely regarded as a brilliant analyst of
Southeast Asian problems. Most observers are in general agreement with
his major points on Southeast Asia and Communist and Nationalist China.
Itly
8. CHINA. "Counter-revolutionaries" are -oredomi a
males over O: Tabu-
lation of a list of 741 "counter-revolutionaries" sentenced to death or
imprisonment in a Chinese city last July reveals the names of only two
women and discloses that the great majority of the men were over 30. (C
FDD U-1521, 24 Oct 51)
Comment: This general breakdown for all areas has been assumed but
not previously proved. Men under 30 and women of all ages have had
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relatively little opportunity to sin, as defined by the Communists, and
Peiping is far more concerned with gaining the support of youth than of
the comparatively unmalleable adult population.
Dalai Lama nays tribute to Chinese forces oc eying Tibet: On 5
November a representative of the Dalai Lama of Tibet formally greeted
General Chang Ching-wu, top Chinese Communist Official in Lhasa, and two
officers commanding the Chinese occupation forces, and presented to them
on behalf of the Dalai Lama 100 sacks of rice and 10,000 taels of Tibetan
silver as a groceries fund for the Chinese troops. The presentation message
from the Dalai Lama acclaimed the arrival of the Chinese troops and stated
"I am happy because they have come here to consolidate national defense and
create happiness and prosperity for the Buddhist people of Tibet." (U FBID
Peiping, S Nov 51)
Comment: Now that Lhasa is securely occupied by Chinese Communist
troops and the Tibetan regime has publicly endorsed the Sino-Tibetan agree-
ment of May 1951, the Dalai Lama will be exploited for his propaganda value.
10. Tsun ien a tlemp_ts g vivs~ of hi g th r movement: Li Tsung-
jen, a leader of one of the third force movements and Vice President of the
Chinese Nationalist Government, now living in New York, is attempting to
launch a comeback into Nationalist politics. One source reports that Li has
25X1A been attempting to rally support among former Chinese leaders now living as
political refugees in the US, while another reveals that he has been in con-
tact with a Japanese Liberal Party Leader.
Comment: Other sources have reported that after the entry of the US
into the Korean war, anti-Chiang and anti-Communist elements were convinced
that the time was propitious for a revival of the third force. These ele-
ments allegedly felt that the US was now committed to military action against
the Communists while at the same time being anti-Chiang.
Li Tsung-jen's retiring to the US after the collapse of the Nationalist
Government on the mainland has reportedly lost him the respect of a great
number of'anti-Communist Chinese who do not support Chiang Kai-shek.
11. KOREA. South Korean delegation to see]j ROK admission to the UN: Ambassador
Muccio reports the departure from Pusan on 6 November of a ROK delegation of
observers to the General Assembly in Paria. The delegation is headed by Prime
Minister Chang, who announced that at the Assembly session the group will seek
to secure the unification of Korea, UN assistance for Korea's economic reha-
bilitation and ROK admission to the UN.
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President Rhee said that another objective is the "rapid liquidation
of the Korean Government's loan to the UN Forces." Rhee further instructed
the observers to give "strong warning" against any future Japanese ambitions
towards Korea. (U Pusan 409, 6 Nov 51)
Comment: ROK motives in sending such ranking figures to the General
Assembly in the capacity of mere observers are not clear in view of Korea's
internal situation, Soviet objections toROK admission to the UN and the
lukewarm attitude of several w'sstern nations towards the inclusion of the
South Koreans. The ROK Government has always displayed great respect for
the UN, and the make-up of the delegation may be designed to make an im-
pression.
The announced objectives of Rhee and the Premier are largely for do-
mestic consumption. However, the inclusion of a "warning" on Japanese in-
tentions1 at a time when rather delicate negotiations are in progress between
the Japanese and South Koreans, is a typical, display of the ROK's lack of
diplomatic savoir-faire.
12. Possible indicator of daterioratIng glige sv stem noted iA orth
Kg;Cg s Radio Pyongyang on 7 November broadcast an ordinance of the Praesi-
diuni of the Supreme People's. Assembly which makes the assignment, sale or
wearing of the regime's decorations and medals by unqualified persons a
criminal offense punishable by two or three years at hard labor. (R FBID
Ticker, 8 Nov 51)
CoMMInts The necessity for Radio Pyongyang to broadcast instructions
of so' picayune a nature and the rash of "unlawful" dealings in medals are
possible indicators of the breakdown of police communications and oontrole.
l3. North Korean Vic Mialat r dial in aotigUe Radio Pyongyang on 7
November broadcast the speech-of Vice Premier Pak Hun-yung at a memorial
service for Pak Tong-cho. Pak Tong-oho became vice minister of Foreign
Affairs when the Government of the Democratic People's Republic of Korea
was formed on 9 September 1948. No details were given of the death of Pak,
a man of about 38, other than the statement that he "died in action." (R
FBID Ticker, 8 Nov 51),
ns Pak is the second North Korean Government official of cabi-
net or vine-cabinet rank who has reportedly died in action during the course
of the war.
14. JAPAN. Japenese Government planning to double streng oiIStIonal Police
Reserve Force. On 8 November the chief of the National Police Reserve told
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the press that his government is working on a plan whereby the strength
of this force will be doubled--to approximately 150,000 men--"after the
peace treaty comes into force." He stated further that training of this
'force will "then be according to the traditional Japanese training methods,
although some American officers will be retained as advisers." (R FBID
Ticker, 9 Nov 51)
Comm n .- Although the Japanese Government has indicated its intention
to strengthen its internal security force, this is the-first time that the
contemplated size has been disclosed. It is presumed that many of the re-
cently depurged former Japanese military officers will assume staff and com-
mand functions. There has been some criticism among former military officers
of the current American-style training and the lack of military background of
the present Police Force leaders.
15. J,u anew Gove,rnment give. an to decontrol rice.- The Japanese
Government's plan to decontrol rice on 1 April 1952 has been abolished, ac-
cording to a Japanese "official statement" of 6 November. This announcement
followed a series of conferences between Japanese cabinet officials and Joseph
M. Dodge, SCAP financial adviser. (U FBID, 7 Nov 51)
Comment.- Despite the social consequences whioh would result from re-
moval of rice from ration and price control while it is still in short supply,
the government has been determined to decontrol rice in keeping with the
Liberal Party's philosophy of a free economy. Minister Dodge, upon his ar-
rival in Japan last month, sharply criticized this planned action, as well as
the government's plan to reduce taxes., because of inflationary effects.
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SECTION 3 (WESTERN)
1, GERMANY-AUSTRIA. Control regulations hamper Austro-German trade
relations: A German businessman having close contact with German
trade officials has recently reported that the German Government is
rapidly losing interest in the development of trade relations with
Austria. This decline in interest is allegedly attributable in part
.to the fact that German export quotas envisaged under the current trade
agreement are in some cases already exhausted by old orders which have
not yet been filled.
A far more serious complication arises out of German fears that a
large proportion of goods exported to Austria are disappearing into
undesirable channels. In an effort to control this diversion, the
German Export Committee issued a circular last August providing that
future applications for exports to Austria would be accepted and
processed only after Austrian authorities had allotted an import
license number confirming that the goods involved would remain in
Austria. Since receipt of the Austrian license is frequently delayed
for periods up to three months,. German exporters are unwilling to
hold, their goods for Austrian shipments that are not 2uaran e ILY
ultimate authorization,
Comment: Inasmuch as West Germany is Austria's best customer,
obstacles to the development of Austro-German trade are a serious
matter for the Austrian Republic, Austrian exports to Germany were
severely curtailed earlier this year by German import restrictions,
and did not recover until mid-year.
It is well-known that Austria has a special problem in
controlling the diversion of imports to Satellite or Soviet users, A
complicated system of Austrian and Allied controls in Vienna is
believed to have been of some effectiveness in restricting illegal
diversion of Austrian imports into East-West trade channels.
The Austrian Government is endeavoring to devise a simplification
of its present highly political import-export licensing system,
2, FRANCE. French attempt to stop attacks on US in Morocco: The US
Embassy in Paris has found the French Forei n-Ofrice "highly embarrassed"
by recent anti-American outbursts of the Resident General in Morocco. He
has been instructed to cease making exaggerated statements unfriendly to
United States representatives and to keep the Moroccan press in line.
(C Paris 2698, 7 Nov 51)
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Comment: The French-language press in Morocco has been conducting
an intensive campaign to discredit American diplomatic representatives
there. Remarks critical of their conduct, made by the Resident General
at a private gathering, have received wide circulation, as have his
threats to ask for the recall of the American'Consul at Rabat. In
line with the Foreign Office's directive, the attacks against the'US
can be expected to decrease.
3. French import policy change may weaken the European Payments Union:
The French representative on the managing board of the European
Payments Union fears "regrettable effects" on the Payments Union as a
result of the uncertainty over the French dollar position, which may
force drastic-cuts in France's dollar import program. While the French
Payments Union position is difficult, the representative believesthat
recent unusually large monthly deficits ar.e'due not only to the
increased import program, but also t- speculation which has exaggerated
inflationary tendencies. (S Paris REPTO 5545, 5 Nov 51)
Comment: A drastic curtailment of French dollar imports would
undoubtedly lead to a large increase in imports from other areas,
including EPU countries, and hence to a worsening French position
within the Union.
A steady deterioration in that position since last spring, a
widening dollar import-export gap, and the increasing threat to the
stability of the franc are now leading the French Government to
question the practicability of the import program it has been promoting
in an effort to halt inflation.
4. NETHERLANDS. Dutch lack of equipment may delay fulfillment of armed
forces commitment: The Dutch Government has expressed concern that
it may not be able to deliver the two divisions and corps troops
promised for the SHAPE maneuvers in September 1952. Because of the
delays in the receipt of US military equipment, the Dutch Defense
Ministry will apparently have to either got higher delivery rates or
else slow down the conscription program. The government, feeling.
that the September deadline is the "moment of greatest. danger," is
adamant in demanding that any Dutch force which participates in the
maneuvers be fully equipped for combat. ( S The Hague 437, 3 Nov 51)
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Comment: Since spring, Dutch military leaders have stated that
failure to receive US military equipment on schedule could lead to a
temporary set-back in the Dutch defense effort.
Insistence on fully equipped troops actually under arms represents
a departure in Dutch policy from military preparedness' on a readily
mobilizable basis. Such a change in policy was recommended by SHAPE
and was probably taken to improve the serious morale problem of the
armed forces.
5. ITALY. Italians want to retain command of S uthern European Lan
Forces: General Marras, Italian Chief of Staff for Defense, is
concerned with the "command implications" of the admission of Greece
into the Atlantic Pact and the nomination of 4 French general as
assistant to Admiral Carney, Commander in Chief of Allied Forces in
Southern Europe. Marras and Defense Minister Pacciardi are in
agreement that the present Italian command of the Southern Land
Forces must be maintained regardless of the possible geographical
expansion of this command.
The Italian objections to the French general are based on the
of any Italian officer now on Carney's staff.
fact that he is to be promoted shortly to a rank superior to that
Comment: To date, no decision has been made as to which.
territorial command Greece or Turkey will come under when they are
admitted to NATO. Both Greece and Turkey want to come under SHAPE,
but neither of them would relish an Italian general as Commander
in Chief of the Southern Land Forces.
6. Italians discouraged by British reaction to their Egyptian
mediation offer: Foreign Secretary Anthony Eden has told the Italian
Ambassador in London that the UK cannot tolerate acceptance of the
principle of unilateral abrogation of the Anglo-Egyptian treaty of
1936 and that it is up to the Egyptians to indicate whether they will
accept US proposals for a new treaty.
Eden's statement, following closely upon a similar statement
of the British Ambassador to a high Foreign Office official in Rome,
25X1A has had a great effect on the Italian Foreign Office. It is believed
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to be further transmitted within the United States, nor beyond
the borders of the United States, without the express permission
of the releasing office.)
Comment: Eden's statement represents established UK policy
in the Egyptian dispute,
Since this dispute may be considered at the current session of
the General Assembly, it seems probable that the Italians will
desist from further mediation offers for the time being.
7. SPAIN. French deny alleged a nroach to Spanish General Staff:
A French Army General Staff officer has denied, to the US Embassy
in Paris, a Madrid report that the French General Staff had
invited the Spanish High General Staff to discuss the possibility
of Spain's entrance into NATO. The Spanish Military Attache in
Paris has expressed disbelief of the report.
The Embassy comments that there has been and may still be some
entirely unofficial communication between the two general staffs, in
which the question of Spanish admission to'NATO may have arisen.
It doubts, however, that any invitation for staff talks was issued
as such action would be tantamount to open defiance of official
French Government policy and would scarcely be risked by the French
General Staff which has shied away from politics since the Revers
scandal. (S Paris 2588, 1 Nov 51)
Comment: Despite recent signs which Spanish officials have
interpreted as evidence of a softening atitude, the French Govern-
ment is not likely to alter drastically its policy toward Spain.
Mile Franco desires a rapprochement between Spain and France and
Britain for reasons of prestige, he is believed to prefer a
bilateral military arrangement with the US to membership in NATO.
8. Franco replies to Don Juan's le ter:
told an official of the US Embassy in Li sbonhthatp,nabout 3t October,
he received a long reply to his letter of 10 July to Franco. The
Opposition Comite de Coordinacion has also informed the US Embassy
in Madrid of Franco's reply. (S Madrid Joint Weeka No. 42, 26 Oct 51)
Comment: Available information on the contents of Franco's
letter is scanty and inconclusive. Apparently Franco is still
interested in reaching an understanding with Don Juan. Presumably,
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 he still hopes that he can induce Don Juan to renounce his rights
to the throne, and that he will then be able to establish himself
as regent for the Pretender's minor son, Juan Carlos. There is no
indication that Don Juan would accept these terms.
25X1 C 9?
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that he could deliver the message.
UNITED KINGDOM. Churchill reportedly sends message to Shvernik:
Winston Churchill has sent a special message to Nikolai Shvernik,
Chairman of the Presidium of the Supreme Soviet, according to a
When Sir Alvary Gascoigne,
the new British Ambassador to Moscow, presented his credentials on
2 November he insisted on a personal conversation with Shvernik so
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(For critical security reasons this report is not to be
further transmitted within the United States or beyond the borders
of the United States without the express permission of the releasing
office.)
Comment: Although the subject of the reported"message is not
known, Churchill has repeatedly advocated talks "on the highest
level" in an endeavor to lessen East-West tensions. There is no
other available information suggesting that the has directly proposed
such talks to the Soviet Union.
10. .SWEDEN. Spy trial discredits Communists: The disclosure that a
fanatic "ultra-Red" Swedish noncommissioned naval officer has
transmitted vital security information (see OCI Daily Digest, 1 Nov 51)
to Soviet Embassy personnel has aroused bitter indignation against
the Swedish Communist Party. This indignation is especially marked
in labor circles, whose earlier objections to "discrimination" against
Communists employed in sensitive jobs now appears to be rapidly dwindling
in the realization of the need for drastic action against bad security
risks. (R Stockholm 611, 7 Nov 51)
Comment: Labor has previously recognized the general need for
security measures but has held that to consider membership in the
Communist Party as an indication of unreliability is pushing one's zeal
for security too far. In July, for example, the Swedish trade union
of .defense workers protested against the Defense Minister's ordering
the dismissal of a Communist sympathizer from his position in a torpedo
plant (see OCI Daily Digest, 10 July 51). The sensational espionage
trial may well dispel labor's excessive concern for civil rights and
will hasten the adoption of stringent security regulations.
13
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SECURITY INFORMATION
9 November 1951
CIA No. 49420-A
Copy No. 49
S/S CABLE SUPPLEMENT.
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. Comments represent the
immediate views of the Office of Current Intelligence.
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SECURITY INFORMATION
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SECTION 1 (SOVIET
1. USSR. USSR protests border violation by US plane in Far East: Deputy
Foreign Minister Gromyko on 7 November protested to the US Charge in
Moscow concerning an alleged air violation of the USSR's border by a US
plane in the area of Cape Ostrovnaya east of Vladivostok. The US Charge
maintained that inasmuch as all US planes in the area were under the United
Nations Command, he could not accept the note as a protest but only as a
statement of fact for information of the US Government. (C S/S Moscow 801,
7 Nov 51)
Comment: The Soviet note gave the violation generally the same
treatment as the April 1950 Baltic plane incident, particularly in stating
that "the Soviet airplanes were forced to open return fire, after which the
American airplane went off in the direction of the sea and disappeared."
2. TRIESTE. US Department of State favors non-interference in impending talo-
Yugoslav nevotiations on Trieste: The Department of State believes that at
the present time the US and Britain should avoid involvement in any Italo-
Yugoslav negotiations concerning Trieste. It considers that the US should
allow time for the Italians and Yugoslavs to begin direct negotiations
before undertaking any further action, assuming that the two governments
will not hesitate to invite third party assistance should the need arise.
In addition, the British Foreign Office has been informed by the
Italians that-the Italian Foreign Office told the Yugoslav Minister in Rome
that'Italy was prepared to enter into direct negotiations. (S S/S to London
2390, 5 Nov 51; to Paris 2737, 6 Nov 51)
SECTION 2 (EASTERN)
3, CHINA/JAPAN. Japanese Overseas AgencZto open in Formosa: The Japanese
Overseas Agency in Taipei is expected to open with the arrival, in late
November, of the chief, Kimura Shiroshichi. (C SIP Taipei 594, 7 Nov 51)
Comment: Plans for the establishment of this agency, to be concerned
primarily with matters of trade, were under way prior to the peace treaty
conference; the Japanese Government, however, deliberately delayed opening
the agency until the treaty was signed for fear of jeopardizing acceptance
of the treaty by countries recognizing Communist China.
Premier Yoshida has repeatedly stated that the establishment of the
agency has no political implications.. In an attempt to emphasize this,
Yoshida asserted that Japan would be equally willing to establish such an
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agency in Shan.phal: he intimated, however, that he would reject a reciprocal
opening of any similar agency in Japan by the Chinese Communists.
4. JAPAN PHILIPPINES. Philippine official takes realistic stand on Japanese
reparations problem: Ambassador Elizalde, Philippine diplomat who has been
in Tokyo investigating Japan's capacity to pay reparations to the
PhIli.ppines, has concluded that his country's demands for reparations are
fantastic, and that Japan can hardly stand one-tenth of what the Filipinos
expect. In a conversation with the US Political Adviser in Tokyo, Elizalde
also indicated that he would advise President Quirino to send a mission to
Japan in January to conclude a reparations agreement covering only 3 to 4
years, after which the problem should be considered closed. He intends to
propose, as a first step to demonstrate good faith, that Japan undertake to
salvage ships sunk in Manila Bay. Elizalde also expressed the opinion that
trade promoted by a, commercial treaty would he of more mut.11a1 benefit than
reparations over a long period. (C S/S Tokyo 943, 7 Nov 51)
Comment: Unofficial reparations claims advanced by the Philippines
during the peace treaty negotiations amounted to 8 billion dollars, a suns
approximately five times Japan's annual national budget. Elizalde's
objective view of the problem gives some hope that satisfactory arrantt-.,-
ments can bp worked ort when the subject can, to a degree, be removed ~m
Philippine politics after the elections this month.
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