NORTH VIETNAM: ECONOMIC DISAPPOINTMENTS 1963-64

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78T02095R000800070017-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 22
• Document Creation Date: December 20, 2016
• Document Release Date: April 12, 2006
• Sequence Number: 17
• Publication Date: October 1, 1964
• Content Type: IM

Approved For Release 2006/05/24:: CIA- 4 95R000800070017-7
INTELLIGENCE MEMORANDUM
NORTH VIETNAM :
ECONOMIC DISAPPOINTMENTS
1963-64
DIRECTORATE OF INTELLIGENCE
Office of Research and Reports
Approved For Release 2006/05/24: CIAR8LTg2095R000800070017-j
N? 135
CIA/RR EM 64-30
October 1964
GROUP i
Excluded from automatic
downgrading and
declassification
 Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
WARNING
This material contains information affecting
the National Defense of the United States
within the meaning of the espionage laws,
Title 18, USC, Sees. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
 Approved For Release 2006/05/24: G BR 8 D2095R000800070017-7
CONTENTS
Summary and Conclusions . . . . . . . . . . . . . . . . . . . 1
I. Economic Plans and Policies . . . . . . . . . . . . . . . 3
II. Agriculture . . . . . . . . . . . . . . . . . . . . . . . 4
A. Background of the Food Problem . . . . . . . . . . . 4
B. Causes of Agricultural Difficulties . . . . . . . . . 5
C. Plans to Speed Up Agricultural Production . . . . . . 6
D. Outlook for the 1964 Crop . . . . . . . . . . . . . . 7
III. Industry and Transportation . . . . . . . . . . . . . . . 7
Page
A. Failure to Meet Industrial Plans . . . . . . . . . 7
B. Poor Quality of Industrial Products . . . . . . . . . 8
C. Transportation . . . . . . . . . . . . . . . . . . . 8
IV. Construction . . . . . . . . . . . . . . . . . . . . . . 9
V. Foreign Economic Relations . . . . . . . . . . . . . . . 10
A. Foreign Trade . . . . . . . . . . . . . . . . . . . . 10
B. Economic Aid . . . . . . . . . . . . . . . . . . . . 10
Appendixes
Appendix A. Statistical Tables . . . . . . . . . . . . . . .
Tables
1. North Vietnam: Output of Major Agricultural Products,
1957-62 and 1965 Plan . . . . . . . . . . . . . . . . . 15
2. North Vietnam: Per Capita Production of Food Crops,
1957-63 and 1965 Plan . . . . . . . . . . . . . . . . .
3. North Vietnam: Output of Selected Industrial Products,
1957-63 and 1965 Plan . . . . . . . . . . . . . . . . .
Approved For Release 2006/05/24: G3A~R2095R000800070017-7
 Approved For Release 20WA5/ EQA-RDP78TO2095R000800070017-7
Page
4. North Vietnam: Foreign Trade, 1957-63 and 1965 Plan . . 18
North Vietnam: Economic Assistance Extended by Communist
Countries, Cumulative Totals, 1955-63 . . . . . . . . . 19
Approved For Release 20M0'5 .-CIA-RDP78TO2095R000800070017-7
 Approved For Release 2006/05/24: CIA-RDP78T02095R000800070017-7
S-E-C-R-E-T
NORTH VIETNAM: ECONOMIC DISAPPOINTMENTS*
1963-64
and Conclusions
The performance of the North Vietnamese economy in 1963 was far
below the plans and expectations of the Communist regime. In agri-
culture, poor harvests reduced food crops** by about 15 percent com-
pared with 1962, and per capita production of food crops was the
smallest since 1957. The gross value of industrial production in-
creased by 6.5 percent compared with the planned figure of 15 percent,
consumer industries being the most laggard. In construction the over-
all level of activity is estimated to have fallen by about 10 percent,
although work on major projects continued with no apparent letup. Ex-
ports increased by 3.7 percent and imports by 4.7 percent compared
with planned increases of 19 percent and 12 percent, respectively.
For the first 6 months of 1964 the levels of industrial produc-
tion, construction activity, and exports remained generally below the
expectations of the regime. Prospects for agriculture in 1964, how-
ever, seem to be better inasmuch as the 1964 spring harvest is reported
to have been well above the poor harvest of 1963. Nevertheless, the
larger part of the annual food crop is yet to be harvested. In industry
and construction the long-term problems remain of building up a skilled
labor force, raising standards of quality, and reducing bureaucratic
ineptness. North Vietnam cannot as yet live free of subsidy from
other Communist countries, and the Sino-Soviet rift may jeopardize
the extent of the subsidy from the USSR. These economic problems --
most particularly in agriculture -- mean that North Vietnam will have
difficulty in fulfilling even the reduced goals of its First Five
Year Plan (1961-65)-***
* The estimates and conclusions in this memorandum represent the best
judgment of this Office as of 15 August 1964. Unless otherwise indicated,
data are official North Vietnamese statistics and contain the usual bi-
ases of Communist economic data. These biases in most instances fall
short of gross exaggeration and are taken into account in reaching the
conclusions in the memorandum.
** The food crops discussed in this memorandum include only rice, corn,
sweet potatoes, and manioc (a starchy root used in making tapioca).
*** For a brief description of the economic achievements and shortcom-
ings of North Vietnam in 1962, see source /. (For serially numbered
source references, see Appendix B.)
S-E-C-R-E-T
Approved For Release 2006/05/24: CIA-RDP78T02095R000800070017-7
 Approved For Release 2006/05144-dhk-1~0078T02095R000800070017-7
I. Economic Plans and Policies
Poor harvests and serious managerial shortcomings in North Vietnam
during 1961-63 caused the pace of both agricultural and industrial de-
velopment to fall far short of the expectations of the regime. Recog-
nizing that many of the targets developed in 1960 for the First Five
Year Plan (1961-65) could not be achieved, the regime announced in May
1963 a reduction of its goals. J The revised plans called for agri-
cultural and industrial production to increase 37 percent and 119 per-
cent, respectively, by 1965 compared with 1960, whereas the original
plan projected increases of 61 percent for agriculture and 148 percent
for industry. Under the revised plan, production of food crops is to
be 7.1 million tons* by the end of 1965 compared with the original goal
of 9.5 million tons. The new target for production of rice is 5 mil-
lion tons, far below the previous goal of 7 million tons. Industrial
targets also were reduced, including goals for production of iron and
steel, electric power, apatite, chromite, cement, and paper. Planned
domestic investment for the 5-year period was lowered from nearly US
$1,380 million to about US $1,050 million.**
Although North Vietnamese planners have been forced to modify their
goals for the First Five Year Plan, they have not abandoned their drive
for the rapid industrialization of the country, particularly in heavy
industry.*** Investment in industry, scheduled to average 48 percent
of total investment during the First Five Year Plan, increased from
45 percent in 1962 to 48 percent in 1963. J The absolute level of in-
dustrial investment, however, actually decreased from nearly US $90
million to about US $87 million.t Eighty percent of all industrial
investment is to go to heavy industry during 1961-65, a goal that is
higher than the average of 75 percent actually invested in heavy in-
dustry during 1961-62.
Agriculture was to receive 21 percent of the total investment dur-
ing the First Five Year Plan. Investment in agriculture in 1963 re-
portedly was 23 percent of the total, the same as in 1962, although
the absolute amount declined. The regime plans to increase agricul-
ture's share to 25 percent in 1964 in an attempt to overcome the
present lag in agricultural production.
Tonnages are given in metric tons throughout this memorandum.
Value figures are based on current dong converted into US dollars
at the rate of 3.7 dong to US $1.
*** Heavy industries receiving special emphasis during the First Five
Year Plan are the machine building, chemical, electric power, and
metallurgical industries.
t The total domestic investment in all sectors of the economy in
North Vietnam reportedly fell from almost US $200 million in 1962 to
about US $180 million in 1963.
Approved For Release 2006/05/24 SCNA b i r02095R000800070017-7
 Approved For Release 2896/Q5/24E-CFlA-RDP78TO2095R000800070017-7
Three-fourths of North Vietnam's gross national product (GN?), esti-
mated at roughly US $1.3 billion (in 1959 prices) in 1963, has been used
to support the population of 17 million at near subsistence levels, and
the average North Vietnamese cannot expect much improvement in his liv-
ing conditions during the remaining 2 years of the First Five Year Plan.
Investment in services (including housing, education, and public health)
has steadily decreased from about 18 percent of total investment; in 1961
to less than 14 percent in 1963. / The regime also is giving a smaller
share of total investment to consumer goods industries during 1961-65 than
in previous years.
II. Agriculture
A. Background of the Food Problem
The tight food situation that persisted in North Vietnam during
1961-62 was seriously aggravated by an extremely poor harvest in 1963.
The gross value of agricultural production is estimated to have fallen
by about 5 percent in 1963 compared with a planned increase of 5.5 per-
cent. Production of food crops reportedly was about 4.9 million tons, J
a level well below the mediocre harvest of 5.7 million tons claimed
for 1962. Although no figures for output of individual crops have been
released, production of rice (which accounts for about 80 to 85 percent
of the total production of food crops) declined from 4.5 million tons
in 1962 to an estimated 4.0 million tons in 1963.- Total production of
subsidiary food crops in 1963 almost certainly fell below the 1.2 mil-
lion tons reportedly produced in 1962. Per capita production of food
crops is estimated to have dropped in 1963 to its lowest level since
1957. In addition to that of food crops, production of important; com-
mercial crops, including sugar cane, cotton, and jute, was reported
officially to have fallen "far below" the 1963 planned targets.**
With the poor harvests of the last 3 years, procurement end dis-
tribution of food have become a serious problem in North Vietnam. In
the fall of 1963 the regime was forced to raise farm procurement prices
substantially, in some cases as high as 50 percent, in an attempt to in-
crease the procurement of agricultural products from the peasants. The
regime acknowledges that the amount of food it was able to purchase from
the peasants in past years was generally lower than the amount needed.
Furthermore, the regime concedes that it has been unable to maintain
strict control over the distribution of food and that black market ac-
tivities have flourished. The flow of food to the black market has in-
creased in part because of the illegal registration of individuals to
obtain rationed food and because of the exaggerated reporting of work
accomplished in order to receive additional food. Procurement and dis-
tribution of food have become such a problem that in May 1964 the
The goal for production of rice in 1964 is set at 4.6 million tons.
For output of major agricultural products and per capita production
of food crops, see Tables 1 and 2, Appendix A.
Approved For Releascb2OO 5 : CIA-RDP78TO2095R000800070017-7
 Approved For Release 2006/05/24E-(CCW RDP78TO2095R000800070017-7
Director for Food Administration in North Vietnam suggested that the
regime may tighten its food procurement and distribution practices.
B. Causes of Agricultural Difficulties
The major causes of agricultural failures in North Vietnam dur-
ing 1961-63 have been adverse weather, mismanagement, and the lack of
fertilizers and insecticides. The regime has claimed that unfavorable
weather, including prolonged droughts in some areas and floods and
excess moisture in other areas, has been the primary reason for the
mediocrity of the harvests. According to Hanoi, the most severe and
extensive floods in North Vietnam since the country has been under Com-
munist rule occurred in 1963. The regime claimed that nearly 560,000
acres of spring crops, equivalent to about one-fourth of the spring rice
crop, were affected by drought, and more than 630,000 acres of autumn
crops, equivalent to about one-fifth of the autumn rice crop, were hit
by floods.
Another important cause of agricultural failures in North Viet-
nam has been mismanagement. For example, during the drought early in
1963, authorities in a number of localities were charged with adminis-
trative and leadership failures as a result of having "fallen into
passivity when the drought dragged on seriously." 10 Late plantings
and shortages of rice seedlings in 1963 can be attributed in part to
mismanagement. Frequent references in the North Vietnamese press to
problems of cooperative management indicate that the regime still is
having considerable difficulty in overcoming peasant indifference to
collectivization. The regime has admitted that managerial shortcom-
ings have permitted the peasants to concentrate their energy on private
plots to the detriment of the cooperative sector. Legally, only 5 per-
cent of the cultivated land of a cooperative is to be reserved for the
private use of the cooperative members. A recent investigation of 175
cooperatives in Phu Tho Province, however, revealed that more than
20 percent of the total cultivated land of the cooperatives was being
used for private purposes. 11 Mismanagement in at least two provinces
in North Vietman -- Lang Son and Thai Nguyen -- has resulted in the
closing of some agricultural cooperatives and a drop in the participa-
tion of the farming population in other cooperatives. Early in 1963
the regime reported that about 88 percent of 2.9 million peasant house-
holds were organized into nearly 30,000 agricultural cooperatives and
farmed about three-fourths of all cultivated land. Because of both con-
tinued mismanagement and poor performance of agriculture in the last
half of 1963, more and more peasants withdrew from the cooperatives. By
June 196+ the percentage of families in cooperatives reportedly had drop-
ped to about 80 percent; another official statement in July indicated
that the percentage had fallen to only about 85 percent. 12
A third cause of agricultural failures in North Vietnam is the
lack of fertilizer and insecticides. Because chemical fertilizer is
Approved For Release 2006/05/24 -tA-RDP-7%TO2095R000800070017-7
 Approved For Release NOf 0,421;iCIA-RDP78TO2095R000800070017-7
available only in small quantities, the regime has concentrated on the
intensive use of organic fertilizer, primarily of animal origin. The
goals for the application of fertilizer in 1963 reportedly were not
met, a shortfall that has been blamed in part for the decrease in crop
yields in 1963. A decision by the government to undertake a program
designed to increase the numbers of livestock and thereby increase the
supply of organic fertilizer has been hampered by shortages of feed
and by extensive slaughtering of animals because of food shortages in
the countryside. The lack of pesticides and fungicides has made it
difficult to fight insects and plant diseases, both of which are re-
sponsible for substantial reductions in crop yields. An official pub-
lication reported in 1963 that 15 to 20 percent of all agricultural
crops, including 600,000 to 700,000 tons of rice, are lost annually
because of plant diseases and damage from insects. 13
C. Plans to Speed Up Agricultural Production
The regime hopes to overcome the current lag in agricultural
production by increasing the amount of investment allocated to agri-
culture and by improving the management of agricultural cooperatives.
Part of the increased investment to agriculture will be used for a new
2-year water conservation program (1964-65) designed to expand the
amount of irrigated acreage. The regime admits, however, that the
program had been poorly administered up to June 1964 and that there is
inadequate coordination of plans between the central and local levels.
In addition to the water conservation program, a 3-year campaign
(1963-65) has been launched to strengthen state control over the co-
operatives and to improve cooperative management; the regime hopes
that this campaign will halt the movement of peasants away from the
cooperatives. The North Vietnamese also have initiated a campaign to
plant rice, subsidiary food crops, or vegetables on all cultivable
land that has not been farmed previously. To encourage increases in
productivity, the regime plans to award capital and consumer goods to
cooperatives achieving certain prescribed yields.
The North Vietnamese hope, furthermore, to increase agricultural
production by developing the mountain areas of the interior. Spokesmen
for the regime have asserted that the mountain areas have a considerable
potential for agricultural expansion, particularly in developing grass-
lands for livestock and in expanding the cultivation of dry-field crops.
Compared with production of food in the delta regions, however, the
potential for production of food on mountain lands is small. As part of
the program to develop the mountain areas, the regime planned to reset-
tle about 300,000 farm workers and 700,000 dependents in these areas
during 1961-65. The State Bank of Vietnam loaned more than 20 million
dong during 1961-63, of which 12 million was given in 1963, to help set-
tle about 300,000 people from the delta areas in the mountain areas. 14
The regime, however, is encountering increasing opposition both from
the minority groups who live in the mountains and from the migrants.
Approved For Releas%290?1 /?9,c CIA-RDP78TO2095R000800070017-7
 Approved For Release 2006/05/24:.?1.Rq'7j8T02095R000800070017-7
D. Outlook for the 1964 Crop
North Vietnam's 1964 spring harvest probably was well above
the poor harvest of 1963, primarily because of relatively favorable
winter and spring moisture conditions. The regime claims that the
total production of spring food crops is the highest ever attained,
even surpassing the peak production of 1959. 15 The spring rice crop
(normally about one-third of the annual rice crop) is claimed to have
exceeded the 1959 bumper crop and to be 18.2 percent greater than the
1963 spring crop. In addition, production of subsidiary food crops,
about 80 percent of which are harvested in the spring, is reported to
be above average. Sweet potatoes are said to have achieved the highest
level of production in any year under the Communist regime, increasing
20 percent above the 1963 spring crop. Production of corn is claimed
to have exceeded the production target for 1964 by 2.3 percent. Pro-
duction of vegetables and nonfood crops, however, fell below expecta-
tions. Furthermore, a large number of buffaloes and oxen died in the
winter of 196364 because of feed shortages and diseases. The regime
has acknowledged that these losses have cut down draft power for the
planting of fall crops in 1964.
A successful spring harvest in 1964, which is implied in the
preliminary figures released by the regime, would have the immediate
effect of relieving the tight food situation in North Vietnam. The
larger part of the annual food crop, however, is harvested in the
autumn, and only a bumper crop for the whole year would permit the re-
gime to reduce imports of grain and begin to replenish stocks.
III. Industry and Transportation
A. Failure to Meet Industrial Plans
Industrial production in North Vietnam in 1963 fell short of
the plan, particularly for the consumer goods industries, because of
serious managerial shortcomings and the lack of agricultural raw
materials. The regime claimed that the gross value of industrial
production increased only 6.5 percent in 1963, well below the planned
increase of about 15 percent. Little information on production of
specific industrial commodities has been released.* The value of pro-
duction of the centrally operated state industry reportedly fulfilled
the plan and increased 9.9 percent in 1963. However, the value of handi-
craft production, which produces mainly consumer goods, failed to meet
the plan and increased only 2.1 percent in 1963. 16
One of the hardest hit industries in North Vietnam in 1963 was
the textile industry, which accounts for about one-fourth of the total
value of industrial production (including handicrafts). Production of
cotton textiles dominates the industry, and North Vietnam imports at
* For production of industrial products, see Table 3, Appendix A.
Approved For Release 2006/05/24 : CiA-RDP--T02095R000800070017-7
 Approved For Release SOMOE L.TCIA-RDP78T02095R000800070017-7
least 80 percent of its required raw cotton. Production of cotton
cloth in 1963 dropped 16 percent, 17 suggesting a possible reduction
in imports of raw cotton as well as reflecting the poor domestic cot-
ton crop. Per capita production of cotton cloth declined from about
5.7 meters in 1962 to less than 4.7 meters in 1963. This drop in per
capita production is consistent with evidence suggesting that the cot-
ton cloth ration was reduced by at least 1 meter in 1963.
Although North Vietnam claims to have exceeded its plan fcr
heavy industry during the first 6 months of 1964 by about 3 percent
(including goals for production of electricity, apatite, and coal),
the regime has indicated that production of such important commodi-
ties as cement, salt, lumber, and mechanical products was below e:K-
pectations. In addition, it is believed that light industrial pro-
duction also was below the level anticipated by the regime. Thus even
the revised targets for many products in the First Five Year Plan may
still be too high.
B. Poor Quality of Industrial Products
Although North Vietnam has developed new industries and ex-
panded old ones with the help of other Communist countries, the quality
of goods manufactured in North Vietman remains low. The frequency of
articles in the press in 1963 criticizing the low quality of many manu-
factured goods and the high rate of rejection of products in many fac-
tories indicates that control over quality is a serious problem. Com-
plaints have ranged all the way from criticism of rubber boots and.
raincoats that were not water-repellent to the rejection of 55 percent
of the diesel engine blocks produced by the Tran Hung Dao Machine Tool
Plant in the first 6 months of 1963 because they were damaged. 18/
These low manufacturing standards not only retard the attempts of the
regime to raise the level of living but also have an adverse effect on
the rate of industrial development.
C. Transportation
The North Vietnamese claim to have exceeded their transporta-
tion plan for ton-kilometers in 1963 by about 6 percent, achieving a
total of about 1.4 billion ton-kilometers (tkm) by both modern and
primitive forms of transport. Of this total, nearly 1.1 billion t:lcm
are estimated to have been performed by modern means. About 75 per=
cent of the 1.1 billion tkm was accounted for by railroads, 9 percent
by inland water transport, and 8 percent each by highway and coastal-
water transport. Although the plan was exceeded, according to the
regime, transportation users complained that the system failed to meet
their demands in 1963 probably because of poor planning at the national
and local levels, the use of large numbers of unskilled personnel, the
lack of equipment and storage facilities, and the uncoordinated and
Approved For ReleafAe2flm69445/2 4 : CIA-RDP78T02095R000800070017-7
 Approved For Release 2006/05 Pe 1 P78TO2095R000800070017-7
inefficient operation of transport organizations.' The regime has
announced that the transportation plan for the first 6 months of 1964
was fulfilled, with the railroad sector surpassing its goal for ton-
kilometers by 5.5 percent. 20
IV. Construction
The level of construction activity in North Vietnam is estimated
to have fallen by about 10 percent in 1963. There was, however, no
apparent letup in the work at such major projects as the Thai Nguyen
Iron and Steel Plant, the Uong Bi Thermal Electric Powerplant, the
Phu Lang Thuong Nitrogen Fertilizer Plant, and the Thac Ba Hydroelec-
tric Powerplant. Although the level of construction activity at these
major projects has been increased in 1964, North Vietnamese statements
suggest that construction plans for the first 6 months of this year
were not achieved. In addition to the construction of industrial
plants, reconstruction of the 156-kilometer railroad line south from
Ham Rong to Vinh continued to receive priority in 1963, and the line
was finally restored to operation in May 1964. Because it is the only
through railroad line to the south, it provides the regime with an im-
portant new logistic capability. The rebuilding of the rail line below
Vinh also has been started. Recent information, however, indicates
that work on this line since the beginning of the rainy season either
has slowed down considerably or has been suspended.
The construction industry in North Vietnam is plagued by the lack
of trained engineers and other technical personnel and by the poor
quality of construction materials. The lack of trained engineers has
meant that specialists from other Communist countries have had to de-
sign and supervise the construction of all major plants and transpor-
tation facilities in North Vietnam. In spite of this outside help,
however, poor management in the construction of many projects has re-
sulted in the failure to maintain planned construction schedules. One
of the best examples of poor planning is the Thai Nguyen Iron and Steel
Plant, which is being built with Chinese Communist aid. Both the North
Vietnamese and the Chinese Communists underestimated the length of time
that it would take to prepare the site and to construct the necessary
auxiliary facilities. The plant originally was scheduled to be produc-
ing 100,000 tons of iron and steel annually by the end of 1960, but the
first blast furnace was not put into operation until December 1963.
Although the mill depends in large measure on coking coal for its opera-
tion, known reserves of coking coal in North Vietnam are quite small and
of questionable quality. As a result, the regime will be forced to im-
port large quantities of coking coal, probably from Communist China.
Poor quality of construction materials also has been a serious prob-
lem. Complaints about cement of uneven quality, of bricks inadequately
Approved For Release 2006/05/243 - 1A=i T02095R000800070017-7
 Approved For Release 206 5/r2 'VC1A-RDP78T02095R000800070017-7
baked, of green lumber, and of damaged finishing materials (,such as
valves, locks, and hinges) are common. For example, in the Lam Thao
Superphosphate Plant a number of pipes reportedly had rusted out and
had to be repaired only a year after completion of the project. The
regime has even admitted that in some cases the poor quality of con-
struction has made it necessary to tear down projects already under-
way and to rebuild them completely.
V. Foreign Economic Relations
A. Foreign Trade
In 1963 the foreign trade of North Vietnam amounted to US
$249 million, an increase of only 4.3 percent above that of 1962.*
Exports increased by 3.7 percent to US $93 million, and imports rose
by 4.7 percent to US $156 million 21 compared with planned increases
of 19 percent and 12 percent, respectively. Because of the poor har-
vest, exports of unprocessed agricultural products grew by only 15 per-
cent 22 instead of 63 percent as anticipated, and exports of indus-
trial products dependent on agriculture for their raw materials fell
short of plan. Having failed to meet export goals, the North Vietnamese
were forced to cut back their imports of nonagricultural commodities.
Imports of food, which generally are small, increased in the latter
part of 1963 and early in 1964. During the first 6 months of 1964, ex-
ports again fell behind plan.
More than 85 percent of North Vietnam's foreign trade in 1963,
(about US $215 million) was estimated to have been with other Communist
countries. Communist China and the USSR together account for a_Dproxi-
mately two-thirds of the country's total trade. Trade with the Free
World occupied less than 15 percent of the total in 1963 (estimated to
be about US $34 million). Japan is still the largest single trading
partner of North Vietnam in the Free World, although its share _!n North
Vietnamese - Free World trade declined from a peak of about 63 percent
in 1960 to about 36 percent in 1963. North Vietnam imports mainly manu-
factured goods and chemicals from the Free World and exports mainly coal.
B. Economic Aid
Economic assistance extended to North Vietnam from 1955 through
1963 was equivalent to more than US $956 million.** About 39 percent
of all economic assistance (approximately US $372 million) was in the
form of grants, with Communist China providing about 60 percent and the
* For data on the foreign trade of North Vietnam, see Table 4, Appen-
dix A.
** For data on economic assistance to North Vietnam by other Communist
countries, see Table 5, Appendix A. Military aid received by North
Vietnam is not included.
Approved For Release 908602 :TCIA-RDP78T02095R000800070017-7
 Approved For Release 2006/05 -?:tA--RD'78TO2095R000800070017-7
USSR about 28 percent of the total.* Of the total credits extended
to North Vietnam (US $584 million), most came from Communist China
and the USSR, which together supplied about 85 percent. Marked ri-
valry between these two countries in planning and administering their
aid programs has not been clearly apparent, although such rivalry
almost certainly exists in some degree. The flaring up of the Sino-
Soviet dispute in 1963-64 and the siding of North Vietnam with Com-
munist China are factors that presumably will affect aid to and trade
with North Vietnam, but so fax the magnitude of the effects is not
clear. Communist countries in Eastern Europe also have given finan-
cial support to North Vietnam amounting to more than US $130 million.
It is estimated that North Vietnam has used about US $334 million of
the extensions from Communist China, about US $324 million from the
USSR, and about US $106 million from the Communist countries in Eastern
Europe.
At present, North Vietnam constitutes only a slight drain on
the economic resources of the other Communist countries, as shown by
the excess of imports above exports. As a result of the program of
economic development that Communist countries have undertaken in North
Vietnam, however, the country eventually will become largely self-
supporting. Aside from mutual gains from trade, North Vietnam makes
no economic contribution to other Communist countries, and it is likely
that the North Vietnamese economy per se never will be important to the
economic support of other Communist countries. From a broader point of
view, North Vietnam is strategically located with respect to Southeast
Asia and is providing a military bridgehead for Communist penetration
into that area. The economy of North Vietnam is capable of supporting
the present level of guerrilla activity in South Vietnam -- the more
so because this activity is largely self-sustaining.
* About 90 percent of all grants to North Vietnam during.1955-63 were
extended in 1955.
Approved For Release 2006/05/2 EG is bP#8TO2095R000800070017-7
 Approved For Release 2006/24 -!IGOc-RDP78TO2095R000800070017-7
STATISTICAL TABLES
Approved For Release 2006G5I RGIAqRDP78TO2095R000800070017-7
 Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
North Vietnam: Output of Major Agricultural Products a/
1957-62 and 1965 Plan
196o
1961
1962
1965 Plan
1957
1958
1959
Rice
3,948.0
4,576.9
5,192.6
4,212.0
4,659.0
2
4
5
4,542.0
275
8
5N 000.0
Corn
197.0
192.0
245.6
214.5
7
.
246
2
.
0
215
N.A.
otatoes
t
S
135.1
106.0
179.7
122.5
.
.
20
A.
N
p
wee
M
ioc J
46.6
38.6
65.1
83.6
182.3
4
.7
2
5
4
.
870.0
an
Sugar cane
384.5
495.1
445.5
451.7
0
26
519.
4
30
7
7.
38.3
50.0
Peanuts (unshelled)
23.7
32.1
34.5
.
.
N
A
A
N
N.A.
beans
So
7.0
11.1
11.8
14.9
.
.
A
.
.
N
A
N.A.
y
Rattan
9.4
12.4
14.8
14.9
.
N.
8
8
.
.
8
13
31.0
te
J
5.7
6.3
7.8
12.4
.
2
6
.
8
5
9.0
u
inned)
tton (un
C
5.7
5.6
6.2
4.6
.
8
.
0
4
6.0
g
o
Tobacco (leaf)
1.7
0.8
0.8
1.7
6
2.
A
.
2
7
3.6
Tea
2.6
2.7
2.4
2.
.
N.
2
.
1
3
N.A.
Sesame
2.0
2.0
2.5
3.3
.9
2
.
A
N
N.A.
Castor beans
0.8
1.2
2.1
2.1
.9
.
.
a. Official North Vietnamese data.
b. On a grain-equivalent basis of 4 to 1.
- 15 -
Approved For Release 2006/05/24_ CIA_ DP78T02095R000800070017-7
S-E- R-
 Approved For Release 05 :.CIA-RDP78TO2095R000800070017-7
North Vietnam: Per Capita Production of Food Crops
1957-63 and 1965 Plan
Year
Total Production
of Food Crops
(Million Metric Tons)
Population
at the End
of the Year L/
(Million Persons)
Per Capita Production
of Food Crops
Kilo rams)
1957
4.3
15.3
281
1958
4.9
15.6
314
1959
5.7
15.9
358
1960
4.9
16.2
302
1961
5.5
16.4
335
1962
5.7
16.8
339
1963
4.9
17.1
287
1965
Plan
7.1
17.9
397
a. Official North Vietnamese data.
b. Estimates of the North Vietnamese population are derived from.-hhe
census figure of 15,916,955 as of 1 March 1960.
Approved For Relea-20O6# 24 : CIA-RDP78TO2095R000800070017-7
 Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
S-E-C-R-E-T
Table 3
North Vietnam: Output of Selected Industrial Products aJ
. 1957-63 and 1965 Plan
1965 Plan
59 1960
8 1
1961
1962
1963 L/
original
Revised
1957
195
9
Electric power
Million kilowatt-hours
121.3
160.2
209.5
256.1
296.6
367.6
445.0
1,000
660
Coal
Thousand metric tons
1,084.8
1,548.9
2,201.7
2,595.0
2,829.4
3,468.0
3,347.0
4,210
5,000
Cement
Thousand metric tons
165.1
301.8
381.2
4o8.0
457.5
462.0
495.0
830
710
Bricks
Million units
409.2
431.6
546.1
942.6
483.3
774.9
N.A.
N.A.
N.A.
Lumber
Thousand cubic meters
86.9
134.8
245.1
281.0
249.4
225.0
N.A.
N.A.
N.A.
Timber
Thousand cubic meters
439.2
458.5
769.8
753.2
828.8
885.0
N.A.
N.A.
1,310
Apatite (ore)
Thousand metric tons
65.9
135.6
260.6
490.0
563.6
678.0
925.0
2,300
1,400
Phosphate
Thousand metric tons
22.5
32.1
50.8
51.0
58.1
34.0
N.A.
N.A.
224
Chromite (ore)
Thousand metric tons
3.7
5.7
6.6
19.4
29.5
32.6
30.3
100
32
Paper
Thousand metric tons
2.4
2.9
4.2
4.5
5.9
N.A.
N.A.
49.2
35.5
Cotton cloth
Million meters
68.1
66.3
78.4
76.0
87.0
95.0
79.6
130
N.A.
Cotton yarn
Thousand metric tons
9.4
8.8
9.8
10.4
11.5
12.1
N.A.
N.A.
N.A.
Cigarettes
Million packages
14.5
30.4
65.9
73.4
81.6
94.6
103.9
N.A.
160
Bicycles
Thousand units
0.3
6.0
12.5
27.0
25.5
39.2
N.A.
N.A.
100
Sugar
Thousand metric tons
4.3
5.5
11.2
10.1
13.0
18.8
N.A.
N.A.
N.A.
Thousand metric tons
109.8
125.0
130.0
117.1
106.1
144.0
126.7
N.A.
250
a. Official North Vietnamese data.
b. Preliminary.
Approved For Release 2006/l5124Q- If f$bP78T02095R000800070017-7
 Approved For Release 2 ( /6%tf41 A-RDP78TO2095R000800070017-7
North Vietnam: Foreign Trade a/
1957-63 and 1965 Plan
Year
Total Trade
Imports
orts
1957
14o.5
99.5
41.0
1958
114.5
63.3
51.2
1959
171.8
lo4.5
67.3
1960
207.8
127.9
79.9
1961
224.2
143.7
80.5
1962
238.8
149.4
89.4
1963
249.1
156.4
92.7
1965 Plan
305
166
139
a. Derived from official North Vietnamese data. Data on total im-
ports are believed to include all goods imported into the country ex-
cept military deliveries on a grant basis.
Approved For Release 670 TCIA-RDP78T02095R000800070017-7
 Approved For Release 2006/0,72-CCiA 131P78TO2095R000800070017-7
North Vietnam: Economic Assistance Extended by Communist Countries J
Cumulative Totals, 1955-63
Million US
t
C
Grants
Credits Total
Percent of Total
ry
oun
Communist China
225.0
232.0 457.0
47.8
USSR
105.0
263.9 368.9 /
38.6
Rumania
4.8
37.5
Poland
7.5
14.5
97.0 J
10.1
Czechoslovakia
9.0
7.5
East Germany
15.0
0 15.0
1.6
Hungary
2.0
10.0 12.0
1.2
Bulgaria
4.0
2.5 6.5
0.7
Total 372.3 584.1 J 956.4 100.0
a. Based on official announcements of aid agreements. Albania and North
Korea also have provided aid to North Vietnam, but the amounts are in-
significant.
b. In September 1962 the USSR signed an agreement for further Soviet
economic assistance to North Vietnam in the development of agricultural
resources. No details concerning the amount of Soviet assistance, how-
ever, have been released.
c. Including credits extended by Rumania, Poland, and Czechoslovakia in
1955 totaling $16.2 million that cannot be broken down by country.
Approved For Release 2006/05/2~-FC1CA=h 8TO2095R000800070017-7
 25X1 Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
Approved For Release 2006/05/24: CIA-RDP78TO2095R000800070017-7
 Approved For Release 2?@61'05 TCIA-RDP78TO2095R000800070017-7
Approved For Release 2006M(2 -RDP78T02095R000800070017-7