DAILY DIGEST JUN 12 1951

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000200380001-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 18
• Document Creation Date: December 16, 2016
• Document Release Date: December 21, 2004
• Sequence Number: 1
• Publication Date: June 12, 1951
• Content Type: SUMMARY

25X1
Approved Fooelease 2005/01/05 : CIA-RDP79T011*00200380
Is" 39
COPY NO.
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
DAILY DIGEST
JUN 12 1951
NOTE-. I. This smeary of s gnificant reports has been
prepared primarily for the intarnAl use of the
Office of Current Intelligence. It doesenot
represent a complete coverage of all current
reports in J CIA or in the Office of , Cur ent
Intelligence,
2, Comments. represent the preliminary views of
the Office of Current Intelligence,
I. targi g letter indications are defined as
follows..
*A* ? items indicati g Soviet-Conmunist
intentions or capabilities,
*B4 , impor?t region #1 developments
not necessarily related to Soviet/
Cornnumiet. intentions or cap ,bilitie
QCs other information indicating trends
and potential developments
*Army, DIA, DOS and USAF
reviews completed*
Approved For Release 2005/01/05 : CIA-RDP79Y01146A000200380001-9
 Approved F
lease 2005Pt10RSM RDP79T011 000200380001-9
SECTION 1 (SOVIET)
"B" USSR, IdeologieailPolitieal Education of Young Communists I aging, According
to a Pravda editorial of 10 Junes some Party organizations are evidently paying
insufficient" heed to the "ideological-political" education of young Communists.
An example of the Irkutsk and North Osetin Party organizations is given where
the instruction of young Communists is not being properly effectuated. Pravda
complains that many of the Party organizations make no attempt to raise their
political and theoretical standards, and that frequently tasks are simply as-
signed without any subsequent implemental action ever being taken. The editor-
ial warns that "this lax approach to the education of young Communists results
in their not taking a daily part in the work of Party organizations;". As a
result, many of these young Communists remain in Candidate rank too long.
Pravda suggests that on the contrary their ability should be early adjudged and
they should be individually trained isabued with a sense of responsibility, and
promptly' assigned to Party jobs, OMMENTg This criti- 25X1
stem reflects in part the difficulties encountered y Soviet youth in its at-
tempts to absorb the complex and rigid tenets, of Party doctrine.
US 1949 Memo on Formosa Draws Soviet lire to VOA, An Izvestia article
on 10 June 51 charged that the publication of the State Department memo of
23 ben 49 regarding Formosa, proved that VOA was given official instructions
to spread lying information concerning US policy. The New York Daily Mirror
was quoted as having noted Acheson?e opposition to publication for fear of
"exposing the US and VOA as liars," but the Senators "who are collecting ar-
guments against President Truman for the 1952 elections" forced 'the Senate
Committee to publish the revealing memo, Thus, concluded the article, the
Committee once more showed the world that the US ruling circles "are carry;
ing on a mistaken, false, dishonest policy,." and that "highly placed re re-
2 5X1 sentatives of the US Government are giving out lies as truth,! 25X1
"C" Moscow Irked by Stronger Articles in Magazine AMERIKAD Literary
Gazette and Pravda severely attacked magazine, AMERIKA,- singling out Issue
No, 46 for an article on "Wages and Prices in the US," This issue, which
was initially put on sale 9 April at only a few Moscow kiosks was complete-
ly withdrawn prior to the attacks. With the magazine unavailable to the
public for comparison, the two critics freely distorted the article.
25X1
yekr,,the Embassy does not feel that they are an indication of Soviet in-
tention to ban the magazine. The Kremlin rather hopes to suppress the
magazine by restricting its distribution and sale but in the meantime may
feel compelled to attack the "tougher" articles which the magazine is now
25X1 printing.
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 Approved F*elease 2005 O RDP79TO11&000200380001-9
"Ae EASTERN EUROPE-USSR, Collectivization Constitutes Serious Problem in
Soviet Orbit, Reporting on the resent action of the Polish Politburo
dissolving a Party District Committee for agricultural collectivization
abuses, US Embassy Warsaw comments that this action is symptomatic of
the serious doctrinal and practical problems raised by sollestiviza
tion in the Soviet orbit. The Embassy notes as evidence of Communist
preoccupation with this problem (1) recent modifications pf the sollecm
tivization program in Poland and Hungary; (2) airing of collectiviza-
tion problems in Czechoslovakia during the resent Party upheavals; and
(3) apparent continuation of discussions in the USSR regarding .Soviet
25X1 collectivization, COMMENTe Collectivize.
tion has been used by the ommun s s to obtain manpower for industrial
expansion through the organization of more efficient agricultural
methods and also as_a means to'consolidate control of the peasantry.
While the former objective has been achieved in part, control of the
peasant, particularly in the European satellites, remains a .serious
problem, This is illustrated by resent steps taken in Bulgaria,.which
is 52% collectivized, to organize a Party control apparatus within the
Ministry of Agriculture to insure the proper functioning of Bulgarians
2 5X1 agricultural production,
?0B~ FINI~A~ID, Aaland Islands Autonomy Bill Under Consideration, The Finnish
Diet again has under consideration a bill to provide the Aaland Islands
with greater autonomy. In an effort to forestall anticipated Soviet ob-
jections, a controversial clause of the 1922 Autonomy I.aw granting the
Aaland Islands Diet a limited right of petition to the League of Nations
through the Finnish President has not been incorporated. This tactic, 25X1
however,, does not preclude the right of the Aaland Islanders to this
right of petition (presumably to the UN), I- I
COMMSNTe The question of a bill to extend the autonomy of tke
25X1 and Islands has arisen several times in resent years,' and in each
case has never been finally approved because of Soviet objections, In
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 t;
25X1
Approved F*elease 2005AJO; RDP79T0111&000200380001-9
view of the strenuous disapproval which the USSR has already voiced through
its radio and press concerning the present bill, and the general policy of
the present Finnish Prime Minister not to take any step whisk might offend
the USSR, it is likely that this bill will not receive final approval.
Local Anti-Aircraft Defense Law Decreed, Acco?ding to a Polish de-
cree of 26 February 1951, local anti-aircraft defenses will be organized
under the Council of Ministers. Actual implementation of the Ministerial
directive will be the duty of the o lee' councils the organs of local
25X1 government, COMMENT: This is
the first evidence of a centralized effort involving civilians to set
up a nationwide Polish anti-aircraft defense system. Thus far there
have been no reports to indicate that this decree has been implemented.
Polish civil defense preparations have heretofore been sporadic and not
5X1. extensive.
"A" YUGOSLAVIA. Belgrade Reacts Favorably To Senate Hearings on US Foreign
Polies. Ambassador Allen reports that high Yugoslav officials have gen-
erally reacted favorably to the current debate on US foreign policy and
have expressed confidence that the administration's policy will be--vin-
dicated. Yugoslav leaders have followed with particular interest and
approval Senator Fulbrig$t's view that US foreign policy should be based
on opposition to aggression as well as his oppositton to MasArthur's in
clination to view all Marxists alike. Ambassador Alen feels that the
debate will have salutary results in Yugoslavia by convincing the Yugo-
slavs that US policy is based squarely on opposition to aggression.
25X1 TOP SECRET
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 Approved Foelease 200,TN/Q&aQI#-RDP79T0111SO00200380001-9
"B" High Official Arrested For Cominformism, Yugoslav authorities have
arrested Assistant Minister of Finance Vojslav Srzentis in connection with
the disappearance of the records of Yugoslav negotiations with the Inter-
national Bank for Reconstruction and Development (IBRD), It is believed
that the records, whisk include valuable information concerning.Yugoslav
is?s economy and financial situation, have been turned over to-tke USSR,
The Assistant Minister of Finance was considered a loyal Yugoslav Commu-
nist and has held important governmental posts since the regime same to
25X1 power, COMMENTS This is the second arrest
of an important Yugoslav official in the past month on charges of Coming
formism, The president of the Yugoslav metallurgical workers syndicate,
Lazar Plavsis, was arrested in May on charges of maintaining contact
with the Cominform underground, In an important speech in February Tito
emphasized the problem of Cominformiem within the Party and warned that
party members must accept Yugoslavia?s policy of cooperation with the
West which was dictated by the Cominform attitude, In a recent speech
before the Central Committee of the Yugoslav Communist Party, Politburo
member Djilas also referred to the problem, indicating-that although
opportunities for freer dissuasion would be granted to Party members
questioning of decisions once made would not be tolerated. While these
arrests and public statements indicate that Cominform activities are
increasing, the ability of the Security Police to ferret out these in,
stances that the regime has the problem under control,
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 25X1
Approved F&elease 20
i
-RDP79T0110000200380001-9
MOTION 2 (EASTERN)
25X1
I&Qe ttl~ t c c~~ t ~ ~r~ e~y o US Ambassador
Crocker in aghd&d po ,s that t of ~ a the 7 wn e dep ?ture
for London of the negotiator a Prima Minister Par. Said (a)
objected to a proposed, IPO sss release which would indicate that
'
an a reeneat had not
~
yat been rea.ohed and k
IPO offer with Oiha z e ixin in PaLyhsda c
the sudden speeding up of the rAegotiations may possibly be explained
by the fact that Nun had hoped to prolong the negotiations until
the Iranian situation became clearer o Y i o s hand was forded.,
however, the imminent departure of the IPO ngotiators and
by IPOos desire to issue a factual press release which would have 25X1
contradicted Nun n s erroneous assertion that IPO had agreed to
settle on the basis of an Iranian agreemento
TOP
25X1
Approved For Release 2005/Oy05 : CIA-RDP79T01146A000200380001-9
e
 Approved Foelease 200 p1 IA-RDP79T0110000200380001-9
25X1
B?BN Participation of Moslems in the Forthcoming National
Eleatione0 At a recent meeting of its Working Committee, the
Indian Union Moslem League resolved to take part in the forthcoming
general elections. It felt, however, that it could not yet deter-
mine the political party to which the Leaguers support should be
given, and it satisfied itself by calling upon Indian Moslems to
stand solidly behind it, without making any other commitments
until such time as a decision should be reached. 2 5X1
25X1 CC s Apathy, fear of parsecu on9 and a
certain discouragement regarding the usefulness of voting in an
election dominated by Hindus will probably combine to keep the
Moslem vote small and ineffective. Furthermore, it is believed
that the 4.0 million Moslems in India are not sufficiently con-
centrated in any part of the country (except possibly near Delhi
and Bombay cities) appreciably to affect the outcome of the
national elections even though they should vote as a relatively
solid bloc,
Imo Senate Foreign Policy Bearings Invite Indonesian
Criticism of US. Indonesian press comment on the current US
Senate hearings reveals an insufficient understanding of the
issues involved and the usual predisposition to criticize
American foreign policy. Most local observers interpreted the
to the extreme regardless of Asian welfare or the psychology of
nearings as indicating US determination to pursue military action
TOP SECRET
Approved For Release 2005/0105: CIA-RDP79T01146A000200380001-9
 Approved Foelease 2O6 J9'M +JIA-RDP79T0110000200380001-9
the Asian 'people o Their reading of the history of US China policy
persuades them that US policy is unpredictable save as it serves
often ill-judged momentary interest, involves stubborn backing of
reactionary causes., and relies upon overpowering economic pressure
or, in the last report, overwhelming military power. The hearings
with their emphasis on military matters- coincide with the
increasingly emphasized Communist peace campaign in Indonesia.
COMENTs While no reports of
o c a n onesian reaction to the policy hearings have been
received, the press undoubtedly reflects the views of many
Indonesian leaders.
"C" Government Committee Recommends Continued but Revised
Financial-Economic Cooperation with Netherlands. The special state
committee set up by the former government to study revision of
Netherlands-Indonesian relations delivered its report to the
Cabinet on 6 June.. The section on financial-economic agreement
the only portion of the report yet available to the US Embassy
recommends continued cooperation with the Dutch but under an
ordinary international agreement rather than under a statute of
the now existing Netherlands-Indonesian Union. The report also
suggests the formation of a committee to determine which Dutch
rights and concessions may be repudiated as unproductive or in-
consistent with Indonesian economic policy, and specifically
recommends that oil company rights exempting them from foreign
exchange controls be rescinded0 US Ambassador Cochran notes that
the Cabinet, which has exhibited a definite trend toward socialism
and nationalism will undoubtedly find the report too conservative.
COMMENT: Revision of Nbtherlands-
nones an relations with special emphasis on abrogation of the
Netherlands-Indonesian Union and modification of the Round Table
Conference Agreements of 1949 is one of the principle points of
the present governmentes program. The cabinet, although possibly
realizing the current necessity of continued financial and
economic cooperation with the Dutch in view of the latter4s large
and productive investments in Indonesia, will want more immedater,
and drastic revisions than the committee has recommended.
TOP SECRET
7
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 Approved FWelease 2098/P198 IA-RDP79TO11W000200380001-9
25X1
"C" rther Evidences of Anti-Communist Sentiment.in the Chinese
Co? A controversy as to whether to use Communist or non-
Communist textbooks in a Rangoon Chinese school has led to a closure
of the school by the Burmese police as a precaution to avoid violence.
The Communists previously have had little. difficulty in winning con-
trol of Chinese schools. On 6 June, one of Burma's leading Chinese
citizens, well known for his pro=Communist activities, was murdered,
apparently as a result of his efforts to bring one of the powerful
Chinese secret societies into a pro-Communist Chinese association
currently being sponsored by the local branch of the China Demo-
cratic Leagued The next day, several Chinese called on US
Ambassador Key to present him with a gift for President Truman
from "the 200,000 free overseas Chinese." US Embassy Rangoon
comments there is growing determination in the local Chinese community
to oppose Communist domination which bears out the recent statement 25X1
of a non-Communist Chinese leader that the severe purges in China
are having a marked effect upon the Chinese in Burma.
25X1 COMIENTs Despite these encouraging developments,
the Chinese Communists are still the dominant political force in
the Burma Chinese community. The severity of the Communist regime
in China is also reported to have caused considerable disillusion-
ment among the Chinese in Thailand and Malaya, and may be indicative
of an incipient anti-Communist trend in a group where the Communists
have undoubtedly counted upon strong supports
"C" INDOCHINA. Chinese ex-Nationalist Troops Enter Indochina. 1,200 25X1
a,ti-Communist Chinese troops have submitted to disarmament and
internment at a French garrison in western Tonkin. They will later
be flown to internment camps in other parts of Indochina.
25X1 COMIIIIENTo Some 30,000 Chinese Nationalist troops
entered Indochina in early 1950 and have since that time remained
in internment camps set up by the French. Smaller groups of
Chinese have occasionally entered Indochina and surrendered them-
selves to the French. This latest contingent does not appear to
be connected with Chinese Nationalist activity on the Burma-Yunnan
frontier.
"C" CHINA. Embassy Moscow Speculates on Future of Dalai Lama. Embassy
Moscow, discussing the future of Tibet, comments that the Dalai Lama
might well "be tempted ...to resort to asylum outside Tibet,"
hoping to return to power with the "eventual defeat of Communism."
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 5X1
5X1
5X1
Approved Foelease 24 1%'j1gh3CIA-RDP79TO110000200380001-9
CO TENTs The 23 May agreement between
the Peiping regime .a .the Tibetan delegation to Peiping makes clear
that Tibet is to be an integral part of Communist China and that
the Dalai Lama, if he remains, is to be subordinate to the Panchen
Lama, a Chinese Communist puppet. The Dalai Lama's alternatives are
either to accept the agreement or to flee, as his forces are
incapable of.offering effective resistance to the planned Chinese
Communist occupation of Tibet. It appears probable that the Dalai
Lama, currently residing in a town near the Indian border, will
eventually seek sanctuary in India or Ceylon.
Further Reports of Slave-Labor Camps in Sinkiang. US ConGen
Hong Kong reports .further evidence" of slaremlabor camps for
political prisoners. in Sinkiang Provinces 125X1
COMMENT s
report. in April the sighting of
a truck convoy of political prisoners en route to Sinkiang.
According to the Communist press, about half of those arrested as
"counter=revolutionaries" are being executed, while the others are
to be rehabilitated through labor. An*extensive slave-labor program
in China?s outlying provinces is a likely eventuality, although
at present the dimensions of such a program are limited by food
supplies in the border areas.
25X1
9
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 25X1
25X1
Approved F.2elease 2G'c IA-RDP79T01'000200380001-9
"C" 'Struggle for Power between Chirnr~0s Possible Successors
Reported. K.G. Wu, who currently considers his position as governor
of Taiwan secure, but limited in power, states that a "frantic
struggle for power" between Chiang Ching-kuo, the Generalissimos
eldest son and chief of the Political and Informational Department
of the Ministry of National Defense, and Premier CHEN Cheng is one
of the greatest danger signs went on the Chinese Nationalist
political scene today. F_ I 25X1
C0MMENTo The ambitions of both contenders have been generally
acknowledged by observers, though incidents of actual friction
have been lacking. CHEN enjoys a greater share of the support
of the old party liners, as well as of the Taiwanese, than does
the younger CHIANG, whose Soviet training and secret police activities
have aroused a large amount of fear and distrusts Many elements
feel that if WU were forced out of the governorship, CHEN Would
then stand virtually alone in opposition to Chiang?s struggle for
control of both the military and political situation on Taiwan.
Reports of Chiang Kai-shek?s disapproval of some of his son?s
more highhanded methods have been generally dismissed as mere
wrist slappis. No statement as to the Identification of the
Generalissimo?s personal selection ~f a successor has been made
public.
Prospects. Geoffrey Aldington, Political Advisor to the Hong
Kong Government, has told US Consul general McConaughy that he
sees "no sign 6f war weariness" among the Chinese, nor of a
disposition on the part of the Communist leadership to "come to
terms.68 Aldington believes that Peiping has sold the Chinese on
a "holy war" to defend China,?s borders, and has "added greatly to
its stature" by demonstrating its ability to "fight a foreign war
against a powerful enemy.", McConaughy feels, however., that
Aldington has "greatly overestimated" popular support of inter=
25X1 vention in Korea. COMMENT.
Peiping as yet has given. no Indication of willingness to modify
its terms for a Korean settlement. 25X1
both Chinese pride in Communist successes in orea an ese
resentment of the sacrifices demaunded by the Korean venture,
attitudes which are not incompatible. Although popular support
for Peiping?s domestic and foreign policies is not widespread.,
Peiping?s control over the populace appears to be firm, and the
regime ? s new seven-month campaign for funds to by heavy equipment
for Korea indicates the Communist intention to force the Chinese
people increasingly to contribute to the Korean venture,
"C" Hone Kona Official "Not Optimistic" over Korean Peace
TOP SECRET
~`
o~,
Approved For Release 2005/01/05 : CIA-RDP79TO1146A000200380001-9
 25X1 Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
Next 1 Page(s) In Document Exempt
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 25X6
5X1
Approved F&elease 2005/01/05: CIA-RDP79TO116000200380001-9
TOP SECRET
"C" ITALY; Humbert Reported Favoring Monarchist Coo eration with Democratic
Pirtiies Former King Humbert is preparing a directive to Monarchis
deputies urging them to cooperate with the democratic parties to fight
Communism and warning ainst an alliance with the neo-fascist Italian
Social Movement (MSI), COMMENT: 25X1
In the recent elections, the Monarchists and HSI participated in j'o
electoral lists in many localities, Because'the Monarchist group is
relatively small, cooperation with the Government would in general result
in little practicable value to the latter. In isolated instances, however,
such as in the Sicilian Regional Assembly, it will facilitate. Government
control by reducing the importance of the 1 5I as a balance of power between
the Government bloc and the Communist bloc,
"B" 10FTU Attempt to Unify Non-Communist Labor Unions Untimely, An
International Confederation of Free Trade Unions Committee is now in Rome
attempting to unify the two anti-Communist. labor confederations, the
Italian Confederation of Labor Unions (CISL) and the Italian Union-of-
Labor (UIL), COMME.NTii Efforts to
unify CISL an appear particularly inopportune a is time. UIL is
sponsored largely by the left-wing of the recently merged democratic
Socialist Party which blames its lack of success in the municipal elections
partly on right-wing democratic Socialist participation in the predominantly
Christian Democratic CISL, distrusted as too close to the Goverment by
much of Italian__labor,. It appears unlikely therefore that UIL would be
willing to'merge with CISL at this time, Such an amalgamation would retard
the emergence of any strong middle groups to which labor could turn as an
alternative to the,Communist or the Christian Democrat-dominated,labor
confederations,
Italians Strengthen Security' Forces, Italian infringement of
Peace Treaty limi a ions on its navy. is indicated by (1) naval. personnel
strength of 35,000 as against a maximum of 27,500 authorized; (2) failure
to scrap a number of damaged ships of types which are prohibited, two
battleships, an uncompleted air craft carrier, two light-cruisers, and
two submarines, and (3) the expansion of a number of na'ral.installations,
The It Air Force now total's 622 air craft with.an additional 298 air
craft under their control, in contrast to the 350 Peace Treaty limitation,
TOP SECRET
13
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 25X1
25X1
Approved F elease 2005/81/05: CIA-RDP79T01'SO00200380001-9
TOP SECRET
The Pubblica,Sicurezza:(the National Police Guard totalling some 70,000
men) is moving toward increased militarization. Guard officers are now
sent regularly to. the Army's signal school and infantry school which frQm 25X1
a .milit stand oint.wi,ll improve:internal securi o
COMMENT These reports .ver
previous speculations of an Increase Italian Army, Navy and Air Force
strengths and equipment. beyond Peace Treaty limits. There will be op-
position among some elements normally supporting the Government to a further
remilitarization of the Pubblica Sicurezza which might furtherimpede pas-
sage.of a Civil Defense Bill placing civil. defense. under' the. Interior
Ministry.. The Police Guard, under Interior Minister Scelba, has been
criticized for indiscriminate zeal in the suppression of public disorders.
-
"B" UNITED KINGDOM, UK, France,, , and US Reach Accord on YUg6siau`--.Ai
d. The UK.,
25X1
5X6
France,and the US have reached agreement on the proposed pan.' or emergency
economic -aid to Yugoslavia, on the basis of percentage contributions - of
23%, 12%, and 65%,_ respectively. Signature of the. agreement on 13. June
will open the way for detailed negotiations with Yugoslavia on the..precise
nature of the uses to which the aid is to be applied and for' ' roaches 25X1
to fourth countries.to secure their participation;
COMMtN;r: Protracted negotiation by the UK and France over a amours of
their respective shares of-the.aid, as well-as over:-certain procedural dif-
ficulties raised by-the UK had del ed th reement for-some weeks.
Participation by Yugoslavia's
creditors wi now be, sought in order to obtain adjustment of Yugoslav debt
payments schedules, with the aim of maximizing the effect-of Western aid
in covering the anticipated Yugoslav deficit `in the ,period to 1 July 1952.
The present intention is to.approach first the Italian Government,'in recog-
nition of Italy's primary security interestin Yugoslavia.
TOP: SECRET
14
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 Approved F&elease 2005/01/05 : CIA-RDP79T01*000200380001-9
SECRET
49230 a--
CENTRAL INTELLIGENCE AGENCY
DAILY DIGEST SUPPLEMENT
JUN 12 1951
Not for dissemination outside 0/CI and O/NE.
, SECRET
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
39
 Approved FWelease 2005/01/05: CIA-RDP79T01 000200380001-9
SECRET
CENTRAL INTELLIGENCE AGENCY
5X1
OFFICE OF CURRENT INTELLIGENCE
.112 Funs 1951
25X1
SECTION 2 (EASTERN)
r'Br' Prime Minister Regljes to Presilent Truman,, In his reply to President
Txuma.nr s, recent. letter', Prime Minister Mossadeq (1) stated that the Iranian
Government does not desire to take any steps contrary to the interests of
the countries which have hitherto used IranQs oil; (2) reiterated his com-
plaints against AIOC; (3) reaffirmed the necessity of nationalizing the
Oil Company in accordance with the Oil Nationalization Law; and (4) stated
that Iran will consider the proposals put forward by AIOC if they are made
immediately and if they are not inconsistent with the principles of national-
ization. Mossadeq also stated that the British Government is concerned in
the dispute only if the settlement, accorded the Company by the Iranian
25X1 Government, is unjust. COMMENT.- The
Prime Ministees reply is simply a reiteration of Mossadeq's previous public
statements on the oil issue. In writing the letter,, Mossadeq was probably
SECRET
15
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 25X6
Approved Foelease 2005/01/05 : CIA-RDP79T0110000200380001-9
SECRET
aware cif its useful propaganda effect in Iran where talks between the Comm
pany officials and the Government have just been initiated, Ambassador
Grady reports that the Foreign Minister, when he handed him the letters
expressed a desire for its immediate publication in Iran, and Mossadeq$,
who has repeatedly indicated to Grady that he wished to implement the law
cautiously, has been criticized in Iran for procrastinating on the matter.
JAPAN/FRANCE, French Announce Substantial Agreement with US on Japanese
Trees . Ambassador Dulles reports..tha,t,.following.acordial meeting with
French Foreign Office officials relative to the Japanese Peace Treaty, the
Foreign Office issued a communique substantially to the effect that no
serious differences of principle existed, leaving only certain texts to be
clarified? The Ambassador notes that the French did not reflect the point
25X1 of viewgiven him by the French Ambassador in London.. 25X1
COMMENT: French Ambassador Massigli in London informed W
officials on 4 June that France prefers a general relaxing of controls over
Japan rather than a peace treaty because of French fears of provoking the
USSR. On 8 June, admitting that they had not taken Japanese and US public
opinion into consideration, the Foreign Office stated it does not intend to
hold up US plans for a treaty, although it felt that too precipitous a con-
clusion of the peace treaty might jeopardize a possible settlement of the
Korean conflict.
SECRET
16
Approved For Release 2005/01/05 : CIA-RDP79T01146A000200380001-9
 TOP SECRET
UNCLASSIFIED when A P ke-Gd F BTMlelasecl2l O5iO1 O5op(S"DWSifGtl-lk$SA(iflWQO46M4dgd or declassi-
fied when filled in form is detached from controlled document.
CONTROL AND COVER SHEET FOR TOP SECRET DOCUMENT
DOCUMENT DESCRIPTION
REGISTRY
SOURCE
CIA CONTROL NO.
DOC. NO.
DATE DOCUMENT RECEIVED
DOC. DATE
COPY NO.
LOGGED BY
NUMBER OF PAGES
NUMBER OF ATTACHMENTS
ATTENTION: This form will be placed on top of and attached to each Top Secret document received by the Central Intelligence Agency
or classified Top Secret within the CIA and will remain attached to the document until such time as it is downgraded, destroyed, or
transmitted outside of CIA. Access to Top Secret matter is limited to Top Secret Control personnel and those individuals whose official
duties relate to the matter. Top Secret Control Officers who receive and/or release the attached Top Secret material will sign this form
and indicate period of custody in the left-hand columns provided. Each individual who sees the Top Secret document will sign and
indicate the date of handling in the right-hand columns.
REFERRED TO
RECEIVED
RELEASED
SEEN BY
OFFICE
SIGNATURE
DATE
TIME
DATE
TIME
SIGNATURE
OFFICE/DIV.
DATE
NOTICE OF DETACHMENT: When this form is detached from Top Secret material it shall be completed in the appropriate spaces below
and transmitted to Central Top Secret Control for record.
DOWNGRADED
DESTROYED
DISPATCHED (OUTSIDE CIA)
TO
BY (Signature)
TO
BY (Signature)
WITNESSED BY (Signature)
BY (Signature)
,,j
OFFICE
DATE
',,,,,,
nrn Fnr ~
OFFICE
qnnX;jnjjnX; . r
Plpa_-~p
DATE
L_PnP7QTn1 1
OFFICE
1ArannnqnnnRnnn1_Q
DATE