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INFORMATION

SU M MA R Y

GENERAL
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3.3(h)(2)

FAR EAST
V/USSR apparently intends to keep its fighter units in Manchuria
(page 3).

SOUTHEAST ASIA
3. Chinese Communist threat to Burma reported (page 4),

4.. 3.3(h)(2)

.~ Viet Minh extends control over delta villages (page 6).

EASTERN EUROPE
6. Soviet Union may reduce trade with Finland (page 6).

WESTERN EUROPE
3.3(h)(2)

Rome reportedly would accept Trieste solution proposecflay S

last May (page 8).

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GENERAL
1.
(h)(2)

FAR EAST
2. USSR apparently intends to keep its fighter units in Manchuria;
3.3 ( )(2)
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Comment: The continued activity of

Soviet fighter elements in southeast Manchuria is further evidence
of Communist efforts to maintain a state of combat readiness.

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SECURITY INFORMATION

SOUTHEAST ASIA
3. Chinese Communist threat to Burma reported:

The Chinese Communists have stationed 3-3(h)(2)

three divisions in the Burma Road border
area, and Burmese forces have moved into
the northern Shan States to meet the threat,
3.3(h)(2)

/one of the Shan chieftains in Burma has turned

Communist ancftha others are likely to do so because of their dis-
like for the Burmese.

Comment: Three divisions of the Chinese

Communist 14th Army for two years have straddled the Burma Road
from the border to Tali, the army's headquarters 150 miles to the
north. The presence of Chinese Nationalist forces has been a standing
invitation for Peiping to intervene in Burma, but there is no convincing
evidence that the Communists are preparing to do so.

Zthere is widespread dissatisfactio?I'3(h)(2)

with the Burmese government among he Shans, who number over 1,000,000
1

and are the second largest minority group in Burma. The Communists
have often been reported to be exploiting this attitudeo

4. 3-3(h)(2)

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3.3(h)(2)

Viet Minh extends control over delta villages:

3.3(h)(2)
The number Tonkin
of villages in the
delta securely held by French and
Vietnamese forces decreased by 20
percent from January through September
ofthis year, according to administrative officials of the provincial
government. The number held by the Viet Minh increased by nine
percent and there was also an increase in the number under fluctuating
control. In September, 1,361 villages were secure, 1,959 were insecure,
and 2,245 were in enemy hands.
Comment: These statistics provide yet
another illustration of the Viet Minh's success in extending its control
within the French defense perimeter.

Ton.kin administrative officials reported

last February that the number of villages held by the Viet Minh had
doubled between 1951 and 1953.

EASTERN EUROPE
Soviet Union may reduce trade with Finland:

The USSR has refused thus

far, in current 3-3(h)(2)
trade negotiations, to conclude contracts
for over $18,000,000 worth of engineering
products, mainly wood processing machinery,
offered by Finland, on grounds that prices are too high. Preliminary

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reports on the trade agreement, signature of which is expected next

week, indicate that Finnish deliveries of ships, sawn timber and pre-
fabricated houses conform generally to basic quotas. In addition
Finland has secured a reduction of 1159000 tons in wheat imports from
the USSR.

A Finnish trade delegate did not rule out

the possibility that Moscow might be attempting to depress Finland's
metal industry for political purposes.

Comment: A reduction of $18,000,000--some

12 percent of Finnish exports to the USSR- -would cause great hardship to
Finland's metalworking industries, which were expanded after the war to
pay reparations to Russia and which are largely dependent upon Orbit
markets. Depressed world markets have already deprived Finland of its
important timber sales to the West.

A 12 November Soviet decree suggests that

the USSR's motivation for reducing its imports of wood-processing
machinery is primarily economic. The decree indicates that the indus-
try's immediate need is apparently not more wood-processing machinery
but the better utilization of logging equipment, a strengthened labor force
and improved transportation.

WESTERN EUROPE
3.3(h)(2)

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3.3(h)(2)

Rome reportedly would accept Trieste solution proposed by US last

3.3(h)(2)
The Italian ambassador to France, currently
in Rome in connection with the Trieste ques-
tion, told Ambassador Luce on 12 November
that the plan suggested by the United States
in May 1953 would be generally acceptable to Italy as a definitive soluti O11-

The ambassador added that Premier Pella

fears the United States and Britain will be intimidated by a Yugoslav
threat to walk out of the conference UIl16SS.Til10'S demands are met.
Yugoslavia, according to the Italian ambassador, will demand the Slav
hinterland in Zone A, without concessions to Italy in Zone B, and will
also demand the construction of a separate port and corridor to the sea

The Italians hope that the United States and

Britain will realize that a separate Yugoslav port would be uneconomic
and that a Yugoslav corridor would be a future source of trouble.
3.3(h)(2)

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